Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 31, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | HORACE MANN EDUCATORS CORP /DE/ | |
Entity Central Index Key | 850,141 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Emerging Growth Company | false | |
Entity Small Business | false | |
Trading Symbol | HMN | |
Entity Common Stock, Shares Outstanding | 40,940,849 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investments | ||
Fixed maturity securities, available for sale, at fair value (amortized cost 2018, $7,419,491; 2017, $7,302,950) | $ 7,529,139 | $ 7,724,075 |
Equity securities, at fair value (cost 2017, $116,320) | 133,184 | 135,466 |
Limited partnership interests | 326,893 | 247,266 |
Short-term and other investments | 252,755 | 245,541 |
Total investments | 8,241,971 | 8,352,348 |
Cash | 6,431 | 7,627 |
Deferred policy acquisition costs | 305,350 | 257,826 |
Goodwill | 47,396 | 47,396 |
Other assets | 387,081 | 381,182 |
Separate Account (variable annuity) assets | 2,292,536 | 2,151,961 |
Total assets | 11,280,765 | 11,198,340 |
Policy liabilities | ||
Investment contract and life policy reserves | 5,690,689 | 5,573,735 |
Unpaid claims and claim expenses | 384,636 | 347,749 |
Unearned premiums | 274,084 | 260,539 |
Total policy liabilities | 6,349,409 | 6,182,023 |
Other policyholder funds | 722,452 | 724,261 |
Other liabilities | 314,441 | 341,053 |
Long-term debt | 297,671 | 297,469 |
Separate Account (variable annuity) liabilities | 2,292,536 | 2,151,961 |
Total liabilities | 9,976,509 | 9,696,767 |
Preferred stock, $0.001 par value, authorized 1,000,000 shares; none issued | 0 | 0 |
Common stock, $0.001 par value, authorized 75,000,000 shares; issued, 2018, 65,764,279; 2017, 65,439,245 | 66 | 65 |
Additional paid-in capital | 473,596 | 464,246 |
Retained earnings | 1,248,814 | 1,231,177 |
Accumulated other comprehensive income (loss), net of tax: | ||
Net unrealized investment gains on securities | 75,958 | 300,177 |
Net funded status of benefit plans | (13,217) | (13,217) |
Treasury stock, at cost, 2018, 24,723,533 shares; 2017, 24,721,372 shares | (480,961) | (480,875) |
Total shareholders’ equity | 1,304,256 | 1,501,573 |
Total liabilities and shareholders’ equity | $ 11,280,765 | $ 11,198,340 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Fixed maturities, available for sale, amortized cost (in usd) | $ 7,419,491 | $ 7,302,950 |
Equity securities, available for sale, cost (in usd) | $ 116,320 | |
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 1,000,000 | 1,000,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 65,764,279 | 65,439,245 |
Treasury stock (in shares) | 24,723,533 | 24,721,372 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Revenues | ||||
Insurance premiums and contract charges earned | $ 206,820 | $ 198,935 | $ 615,428 | $ 590,375 |
Net investment income | 99,083 | 92,320 | 288,048 | 275,025 |
Net investment gains (losses) | 2,803 | (3,486) | 1,884 | (1,656) |
Other income | 2,612 | 2,048 | 7,704 | 4,813 |
Total revenues | 311,318 | 289,817 | 913,064 | 868,557 |
Benefits, losses and expenses | ||||
Benefits, claims and settlement expenses | 161,846 | 134,895 | 473,686 | 444,870 |
Interest credited | 52,124 | 50,078 | 153,229 | 148,200 |
DAC amortization expense | 26,066 | 24,210 | 79,357 | 73,904 |
Operating expenses | 50,989 | 44,172 | 149,376 | 139,156 |
Interest expense | 3,253 | 2,978 | 9,717 | 8,879 |
Total benefits, losses and expenses | 294,278 | 256,333 | 865,365 | 815,009 |
Income before income taxes | 17,040 | 33,484 | 47,699 | 53,548 |
Income tax expense | 4,512 | 6,933 | 9,099 | 9,418 |
Net income | $ 12,528 | $ 26,551 | $ 38,600 | $ 44,130 |
Net income per share | ||||
Basic (in usd per share) | $ 0.30 | $ 0.64 | $ 0.93 | $ 1.07 |
Diluted (in usd per share) | $ 0.30 | $ 0.64 | $ 0.93 | $ 1.06 |
Weighted average number of shares and equivalent shares | ||||
Basic (in shares) | 41,683 | 41,433 | 41,586 | 41,337 |
Diluted (in shares) | 41,850 | 41,575 | 41,727 | 41,467 |
Net investment gains (losses) | ||||
Total other-than-temporary impairment losses on securities | $ (70) | $ (6,092) | $ (1,357) | $ (12,452) |
Portion of losses recognized in other comprehensive income (loss) | 0 | 0 | 0 | 0 |
Net other-than-temporary impairment losses on securities recognized in earnings | (70) | (6,092) | (1,357) | (12,452) |
Sales and other, net | (1,331) | 2,365 | 2,661 | 10,050 |
Change in fair value - equity securities | 2,000 | 0 | (4,342) | 0 |
Change in fair value and gains (losses) realized on settlements - derivative instruments | 2,204 | 241 | 4,922 | 746 |
Net investment gains (losses) | $ 2,803 | $ (3,486) | $ 1,884 | $ (1,656) |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Comprehensive income (loss) | ||||
Net income | $ 12,528 | $ 26,551 | $ 38,600 | $ 44,130 |
Other comprehensive income (loss), net of tax: | ||||
Change in net unrealized investment gains (losses) on securities | (49,638) | 12,208 | (209,178) | 79,980 |
Change in net funded status of benefit plans | 0 | 0 | 0 | 0 |
Cumulative effect of change in accounting principle | 0 | 0 | (15,041) | 0 |
Other comprehensive income (loss) | (49,638) | 12,208 | (224,219) | 79,980 |
Total | $ (37,110) | $ 38,759 | $ (185,619) | $ 124,110 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) - USD ($) $ in Thousands | Total | Common stock | Additional paid-in capital | Retained earnings | Accumulated other comprehensive income (loss), net of tax: | Treasury stock, at cost |
Beginning balance at Dec. 31, 2016 | $ 65 | $ 453,479 | $ 1,155,732 | $ 163,921 | $ (479,215) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Options exercised, 2018, 131,324 shares; 2017, 156,211 shares | 0 | |||||
Conversion of common stock units, 2018, 30,368 shares; 2017, 15,981 shares | 0 | |||||
Conversion of restricted stock units, 2018, 170,406 shares; 2017, 293,002 shares | 0 | |||||
Options exercised and conversion of common stock units and restricted stock units | 2,773 | |||||
Share-based compensation expense | 5,816 | |||||
Net income | $ 44,130 | 44,130 | ||||
Dividends, 2018, $0.855 per share; 2017, $0.825 per share | (34,580) | |||||
Change in net unrealized investment gains on securities | 79,980 | 79,980 | ||||
Change in net funded status of benefit plans | 0 | 0 | ||||
Cumulative effect of change in accounting principle | 0 | 0 | 0 | |||
Acquisition of shares, 2018, 2,161 shares; 2017, 48,440 shares | (1,660) | |||||
Ending balance at Sep. 30, 2017 | 1,390,441 | 65 | 462,068 | 1,165,282 | 243,901 | (480,875) |
Beginning balance at Jun. 30, 2017 | 231,693 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 26,551 | |||||
Change in net unrealized investment gains on securities | 12,208 | |||||
Change in net funded status of benefit plans | 0 | |||||
Cumulative effect of change in accounting principle | 0 | |||||
Ending balance at Sep. 30, 2017 | 1,390,441 | 65 | 462,068 | 1,165,282 | 243,901 | (480,875) |
Beginning balance at Dec. 31, 2017 | 1,501,573 | 65 | 464,246 | 1,231,177 | 286,960 | (480,875) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Options exercised, 2018, 131,324 shares; 2017, 156,211 shares | 0 | |||||
Conversion of common stock units, 2018, 30,368 shares; 2017, 15,981 shares | 0 | |||||
Conversion of restricted stock units, 2018, 170,406 shares; 2017, 293,002 shares | 1 | |||||
Options exercised and conversion of common stock units and restricted stock units | 3,262 | |||||
Share-based compensation expense | 6,088 | |||||
Net income | 38,600 | 38,600 | ||||
Dividends, 2018, $0.855 per share; 2017, $0.825 per share | (36,004) | |||||
Change in net unrealized investment gains on securities | (209,178) | (209,178) | ||||
Change in net funded status of benefit plans | 0 | 0 | ||||
Cumulative effect of change in accounting principle | (15,041) | 15,041 | (15,041) | |||
Acquisition of shares, 2018, 2,161 shares; 2017, 48,440 shares | (86) | |||||
Ending balance at Sep. 30, 2018 | 1,304,256 | 66 | 473,596 | 1,248,814 | 62,741 | (480,961) |
Beginning balance at Jun. 30, 2018 | 112,379 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 12,528 | |||||
Change in net unrealized investment gains on securities | (49,638) | |||||
Change in net funded status of benefit plans | 0 | |||||
Cumulative effect of change in accounting principle | 0 | |||||
Ending balance at Sep. 30, 2018 | $ 1,304,256 | $ 66 | $ 473,596 | $ 1,248,814 | $ 62,741 | $ (480,961) |
CONSOLIDATED STATEMENTS OF CH_2
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - $ / shares | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 | ||
Treasury stock (in shares) | 24,723,533 | 24,721,372 | ||
Common stock | ||||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 | ||
Options exercised (in shares) | 131,324 | 156,211 | ||
Conversion of common stock units (in shares) | 30,368 | 15,981 | ||
Conversion of restricted stock units (in shares) | 170,406 | 293,002 | ||
Retained earnings | ||||
Cash dividends (in usd per share) | $ 0.855 | $ 0.825 | ||
Treasury stock, at cost | ||||
Treasury stock (in shares) | 24,723,533 | 24,721,372 | 24,721,372 | 24,672,932 |
Treasury stock, acquisitions (in shares) | 2,161 | 48,440 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cash flows - operating activities | ||
Premiums collected | $ 598,443 | $ 598,882 |
Policyholder benefits paid | (419,736) | (410,241) |
Policy acquisition and other operating expenses paid | (218,464) | (208,248) |
Income taxes paid | (8,719) | (10,061) |
Investment income collected | 277,178 | 271,717 |
Interest expense paid | (6,537) | (5,821) |
Other | (4,691) | 975 |
Net cash provided by operating activities | 217,474 | 237,203 |
Fixed maturity securities | ||
Purchases | (1,044,002) | (1,041,744) |
Sales | 360,246 | 315,531 |
Maturities, paydowns, calls and redemptions | 577,425 | 691,169 |
Equity securities | ||
Purchases | (8,578) | (27,219) |
Sales and repayments | 8,493 | 21,710 |
Limited partnership interests | ||
Purchases | (84,444) | (87,613) |
Sales | 11,754 | 15,097 |
Change in short-term and other investments, net | (4,700) | (74,365) |
Net cash used in investing activities | (183,806) | (187,434) |
Cash flows - financing activities | ||
Dividends paid to shareholders | (35,016) | (34,580) |
Acquisition of treasury stock | (86) | (1,660) |
Proceeds from exercise of stock options | 3,191 | 3,815 |
Withholding tax payments on RSUs tendered | (2,190) | (2,745) |
Annuity contracts: variable, fixed and FHLB funding agreements | ||
Deposits | 326,003 | 348,900 |
Benefits, withdrawals and net transfers to Separate Account (variable annuity) assets | (333,473) | (295,064) |
Transfer of Company 401(k) assets to a third-party provider | 0 | (77,898) |
Life policy accounts | ||
Deposits | 5,618 | 3,357 |
Withdrawals and surrenders | (3,766) | (3,340) |
Change in bank overdrafts | 4,855 | (532) |
Net cash used in financing activities | (34,864) | (59,747) |
Net decrease in cash | (1,196) | (9,978) |
Cash at beginning of period | 7,627 | 16,670 |
Cash at end of period | $ 6,431 | $ 6,692 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements of Horace Mann Educators Corporation (HMEC; and together with its subsidiaries, the Company or Horace Mann) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) and with the rules and regulations of the Securities and Exchange Commission (SEC), specifically Regulation S-X and the instructions to Form 10-Q. Certain information and disclosures normally included in annual financial statements prepared in conformity with GAAP, but are not required for interim reporting purposes, have been omitted. The Company believes that these consolidated financial statements contain all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to present fairly the Company’s consolidated financial position as of September 30, 2018 , the consolidated results of operations and comprehensive income (loss) for the three and nine month periods ended September 30, 2018 and 2017 and the consolidated changes in shareholders’ equity and cash flows for the nine month periods ended September 30, 2018 and 2017 . The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The subsidiaries of HMEC market and underwrite personal lines of property and casualty insurance products (primarily personal lines of automobile and property insurance), retirement products (primarily tax-qualified annuities) and life insurance, primarily to K-12 teachers, administrators and other employees of public schools and their families. HMEC’s principal operating subsidiaries are Horace Mann Life Insurance Company, Horace Mann Insurance Company, Teachers Insurance Company, Horace Mann Property & Casualty Insurance Company and Horace Mann Lloyds. These consolidated financial statements should be read in conjunction with the consolidated financial statements and the related notes to consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The results of operations for the three and nine month period ended September 30, 2018 are not necessarily indicative of the results to be expected for the full year. The Company has reclassified the presentation of certain prior period information to conform to the current presentation. Investment Contract and Life Policy Reserves This table summarizes the Company’s investment contract and life policy reserves. ($ in thousands) September 30, 2018 December 31, 2017 Investment contract reserves $ 4,545,232 $ 4,452,972 Life policy reserves 1,145,457 1,120,763 Total $ 5,690,689 $ 5,573,735 Accumulated Other Comprehensive Income (Loss) Accumulated other comprehensive income (loss) (AOCI) represents the accumulated change in shareholders’ equity from transactions and other events and circumstances from non-shareholder sources. For the Company, AOCI includes the after tax change in net unrealized investment gains (losses) on securities and the after tax change in net funded status of benefit plans for the periods as shown in the Consolidated Statements of Changes in Shareholders’ Equity. The following tables reconcile these components. ($ in thousands) Net Unrealized Investment Gains (Losses) on Securities (1)(2) Net Funded Status of Benefit Plans (1) Total (1) Beginning balance, July 1, 2018 $ 125,596 $ (13,217 ) $ 112,379 Other comprehensive income (loss) before reclassifications (49,165 ) — (49,165 ) Amounts reclassified from accumulated other comprehensive income (loss) (473 ) — (473 ) Cumulative effect of change in accounting principle — — — Net current period other comprehensive income (loss) (49,638 ) — (49,638 ) Ending balance, September 30, 2018 $ 75,958 $ (13,217 ) $ 62,741 Beginning balance, January 1, 2018 $ 300,177 $ (13,217 ) $ 286,960 Other comprehensive income (loss) before reclassifications (211,577 ) — (211,577 ) Amounts reclassified from accumulated other comprehensive income (loss) 2,399 — 2,399 Cumulative effect of change in accounting principle (3) (15,041 ) — (15,041 ) Net current period other comprehensive income (loss) (224,219 ) — (224,219 ) Ending balance, September 30, 2018 $ 75,958 $ (13,217 ) $ 62,741 ________________ (1) All amounts are net of tax. (2) The pretax amounts reclassified from AOCI, $599 thousand and $(3,037) thousand , are included in Net investment gains (losses) and the related income tax expenses, $126 thousand and $(638) thousand , are included in Income tax expense in the Consolidated Statements of Operations for the three and nine month periods ended September 30, 2018 , respectively. (3) The Company adopted guidance on January 1, 2018 that resulted in reclassifying $15,041 thousand of after tax net unrealized gains on equity securities from AOCI to Retained earnings. ($ in thousands) Net Unrealized Investment Gains (Losses) on Securities (1)(2) Net Funded Status of Benefit Plans (1) Total (1) Beginning balance, July 1, 2017 $ 243,510 $ (11,817 ) $ 231,693 Other comprehensive income (loss) before reclassifications 9,786 — 9,786 Amounts reclassified from accumulated other comprehensive income (loss) 2,422 — 2,422 Net current period other comprehensive income (loss) 12,208 — 12,208 Ending balance, September 30, 2017 $ 255,718 $ (11,817 ) $ 243,901 Beginning balance, January 1, 2017 $ 175,738 $ (11,817 ) $ 163,921 Other comprehensive income (loss) before reclassifications 78,419 — 78,419 Amounts reclassified from accumulated other comprehensive income (loss) 1,561 — 1,561 Net current period other comprehensive income (loss) 79,980 — 79,980 Ending balance, September 30, 2017 $ 255,718 $ (11,817 ) $ 243,901 ________________ (1) All amounts are net of tax. (2) The pretax amounts reclassified from AOCI, $(3,726) thousand and $(2,401) thousand , are included in Net investment gains (losses) and the related income tax expenses, $(1,304) thousand and $(840) thousand , are included in Income tax expense in the Consolidated Statements of Operations for the three and nine month periods ended September 30, 2017 , respectively. Comparative information for elements that are not required to be reclassified in their entirety to Net income in the same reporting period is located in Note 2 -- Investments -- Net Unrealized Investment Gains (Losses) on Securities. Adopted Accounting Standards Revenue Recognition In May 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance, with an effective date that was deferred to January 1, 2018, to provide a single comprehensive model in accounting for revenue arising from contracts with customers. The guidance applies to all contracts with customers; however, certain insurance contracts are specifically excluded from this updated guidance. The Company adopted the guidance on January 1, 2018, using the modified retrospective transition method. The guidance did not have an impact on the Company’s consolidated financial position, results of operations, cash flows, or disclosures. Recognition and Measurement of Financial Assets and Liabilities In January 2016, the FASB issued accounting guidance to improve certain aspects of the recognition, measurement, presentation and disclosure of financial instruments. Among other things, the guidance revises the accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. The Company adopted the guidance on January 1, 2018 using the modified retrospective approach that resulted in reclassifying $15,041 thousand of after tax net unrealized gains on equity securities from AOCI to Retained earnings. The Company's Consolidated Statements of Operations were impacted as changes in fair value of equity securities are now being reported in Net investment gains (losses) instead of reported in other comprehensive income (loss) (OCI). Statement of Cash Flows -- Classification In August 2016, the FASB issued guidance to reduce diversity in practice in the statement of cash flows between operating, investing and financing activities related to the classification of cash receipts and cash payments for eight specific issues. The FASB acknowledged that current GAAP either is unclear or does not include specific guidance on these eight cash flow classification issues: (1) debt prepayment or extinguishment costs; (2) settlement of zero-coupon bonds (pertains to issuers); (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims (pertains to claimants); (5) proceeds from the settlement of corporate-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions (pertains to transferors) and (8) separately identifiable cash flows and application of the predominance principle. The Company adopted the guidance on January 1, 2018 using a retrospective approach which had no impact to the prior year amounts reported in the Consolidated Statement of Cash Flows. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (Loss) On February 14, 2018, the FASB issued accounting guidance that permits recognition of a reclassification adjustment between AOCI and Retained earnings for stranded tax amounts related to the reduced corporate tax rate enacted under the Tax Act. As permitted under its provisions, the Company early adopted the accounting guidance effective for the quarterly period that ended December 31, 2017 and elected to reclassify the stranded tax amounts. The impact from early adoption resulted in an increase to AOCI and a reduction to Retained earnings of approximately $47,900 thousand ; representing the stranded deferred tax liabilities of $50,034 thousand and $(2,134) thousand for Net unrealized investment gains (losses) on securities and Net funded status of benefit plans, respectively. Pending Accounting Standards Accounting for Leases In February 2016, the FASB issued accounting and disclosure guidance to improve financial reporting and comparability among organizations about leasing transactions. Under the new guidance, for leases with lease terms of more than 12 months, a lessee will be required to recognize assets and liabilities on the balance sheet for the rights and obligations created by those leases. Consistent with current accounting guidance, the recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or an operating lease. However, while current guidance requires only capital leases to be recognized on the balance sheet, the new guidance will require both operating and capital leases to be recognized on the balance sheet. This new guidance is effective for annual reporting periods beginning December 15, 2018, and interim reporting periods within those annual periods, with early adoption permitted. The Company will adopt this new guidance on January 1, 2019, and the Company expects to use the optional transition method, which allows the Company to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption (i.e., comparative periods presented in the consolidated financial statements will continue to be in conformity with current GAAP). While the Company is in the process of evaluating the impact of the guidance, it does not expect the guidance to have a material impact on its consolidated financial statements. Had the Company adopted the guidance on September 30, 2018 , it would have recognized additional operating liabilities of $13,267 thousand , with corresponding right of use assets of the same amount based on the present value of the expected remaining lease payments under the new guidance. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued guidance to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments, including reinsurance receivables, held by companies. The new guidance replaces the incurred loss impairment methodology and requires an organization to measure and recognize all current expected credit losses (CECL) for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Companies will need to utilize forward-looking information to better inform their credit loss estimates. Companies will continue to use judgment to determine which loss estimation method is appropriate for their circumstances. Any credit losses related to available for sale debt securities will be recorded through an allowance for credit losses with this allowance having a limit equal to the amount by which fair value is below amortized cost. The guidance also requires enhanced qualitative and quantitative disclosures to provide additional information about the amounts recorded in the financial statements. For public business entities, the guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those years, using a modified-retrospective approach. Early application is permitted for annual reporting periods, and interim periods within those years, beginning after December 15, 2018. Management is evaluating the impact this guidance will have on the results of operations and financial position of the Company. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. All other goodwill impairment guidance will remain largely unchanged. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. The same one-step impairment test will be applied to goodwill at all reporting units, even those with zero or negative carrying amounts. Entities will be required to disclose the amount of goodwill for reporting units with zero or negative carrying amounts. Public business entities should adopt the guidance prospectively for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early application is permitted. Management believes the adoption of this accounting guidance will not have a material effect on the results of operations and financial position of the Company. Accounting for Long-Duration Insurance Contracts |
Investments
Investments | 9 Months Ended |
Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | The Company’s investment portfolio includes free-standing derivative financial instruments (currently over the counter index call option contracts) to economically hedge risk associated with its fixed indexed annuity (FIA) and indexed universal life (IUL) products’ contingent liabilities. The Company’s FIA and IUL products include embedded derivative features that are discussed in Note 1 -- Summary of Significant Accounting Policies -- Investment Contract and Life Policy Reserves -- Reserves for Fixed Indexed Annuities and Indexed Universal Life Policies of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The Company’s investment portfolio included no other free-standing derivative financial instruments (futures, forwards, swaps, option contracts or other financial instruments with similar characteristics), and there were no other embedded derivative features related to the Company’s investment or insurance products during the nine month periods ended September 30, 2018 and 2017 . Fixed Maturity Securities The Company’s investment portfolio is comprised primarily of fixed maturity securities. The amortized cost, net unrealized investment gains (losses) and fair values of all fixed maturity securities in the portfolio were as follows: ($ in thousands) Amortized Cost/Cost Unrealized Investment Gains Unrealized Investment Losses Fair Value September 30, 2018 (1) Fixed maturity securities U.S. Government and federally sponsored agency obligations: (2) Mortgage-backed securities $ 758,301 $ 15,744 $ 23,209 $ 750,836 Other, including U.S. Treasury securities 802,508 12,528 32,436 782,600 Municipal bonds 1,783,711 119,671 19,708 1,883,674 Foreign government bonds 92,860 2,787 644 95,003 Corporate bonds 2,290,452 74,409 29,365 2,335,496 Other mortgage-backed securities 1,691,659 8,073 18,202 1,681,530 Totals $ 7,419,491 $ 233,212 $ 123,564 $ 7,529,139 December 31, 2017 Fixed maturity securities U.S. Government and federally sponsored agency obligations: (2) Mortgage-backed securities $ 669,297 $ 30,460 $ 3,032 $ 696,725 Other, including U.S. Treasury securities 714,613 26,311 5,516 735,408 Municipal bonds 1,711,581 184,107 2,435 1,893,253 Foreign government bonds 96,780 5,958 — 102,738 Corporate bonds 2,409,426 173,862 4,334 2,578,954 Other mortgage-backed securities 1,701,253 22,935 7,191 1,716,997 Totals $ 7,302,950 $ 443,633 $ 22,508 $ 7,724,075 Equity securities (3) $ 116,320 $ 19,425 $ 279 $ 135,466 ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, available for sale equity securities were reclassified to equity securities at fair value and are excluded from the table above as of September 30, 2018. (2) Fair value includes securities issued by Federal National Mortgage Association (FNMA) of $408,130 thousand and $361,955 thousand ; Federal Home Loan Mortgage Corporation (FHLMC) of $408,858 thousand and $400,001 thousand ; and Government National Mortgage Association (GNMA) of $96,018 thousand and $104,168 thousand as of September 30, 2018 and December 31, 2017 , respectively. (3) Includes nonredeemable (perpetual) preferred stocks, common stocks and closed-end funds. The following table presents the fair value and gross unrealized losses of securities in an unrealized loss position at September 30, 2018 and December 31, 2017 , respectively. The Company views the decrease in value of all of the securities with unrealized losses at September 30, 2018 -- which was driven largely by increasing interest rates, spread widening, financial market illiquidity and/or market volatility from the date of acquisition -- as temporary. For fixed maturity securities, management does not have the intent to sell the securities and it is not more likely than not the Company will be required to sell the securities before the anticipated recovery of their amortized cost bases, and management expects to recover the entire amortized cost bases of the fixed maturity securities. Therefore, it was determined that the unrealized losses on the securities presented in the table below were not other than temporarily impaired as of September 30, 2018 . ($ in thousands) 12 Months or Less More than 12 Months Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses September 30, 2018 (1) Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 330,285 $ 13,484 $ 99,483 $ 9,725 $ 429,768 $ 23,209 Other 450,713 18,510 163,569 13,926 614,282 32,436 Municipal bonds 491,680 13,484 75,678 6,224 567,358 19,708 Foreign government bonds 19,856 644 — — 19,856 644 Corporate bonds 821,190 20,801 90,998 8,564 912,188 29,365 Other mortgage-backed securities 902,673 10,207 252,739 7,995 1,155,412 18,202 Total $ 3,016,397 $ 77,130 $ 682,467 $ 46,434 $ 3,698,864 $ 123,564 Number of positions with a gross unrealized loss 1,237 246 1,483 Fair value as a percentage of total fixed maturity securities fair value 39.4 % 8.9 % 48.3 % December 31, 2017 Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 134,032 $ 1,053 $ 40,606 $ 1,979 $ 174,638 $ 3,032 Other 168,634 1,849 122,753 3,667 291,387 5,516 Municipal bonds 29,437 100 79,140 2,335 108,577 2,435 Foreign government bonds — — — — — — Corporate bonds 115,113 2,701 36,081 1,633 151,194 4,334 Other mortgage-backed securities 457,166 2,791 168,972 4,400 626,138 7,191 Total fixed maturity securities 904,382 8,494 447,552 14,014 1,351,934 22,508 Equity securities (2) 6,027 249 1,277 30 7,304 279 Combined totals $ 910,409 $ 8,743 $ 448,829 $ 14,044 $ 1,359,238 $ 22,787 Number of positions with a gross unrealized loss 354 158 512 Fair value as a percentage of total fixed maturity and equity securities fair value 11.6 % 5.7 % 17.3 % ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, available for sale equity securities were reclassified to equity securities at fair value and are excluded from the table above as of September 30, 2018. (2) Includes nonredeemable (perpetual) preferred stocks, common stocks and closed-end funds. Fixed maturity securities with an investment grade rating represented 97.5% of the gross unrealized losses as of September 30, 2018 . With respect to fixed maturity securities involving securitized financial assets, the underlying collateral cash flows were stress tested to determine there was no adverse change in the present value of cash flows below their amortized cost bases. Credit Losses The following table summarizes the cumulative amounts related to the Company’s credit loss component of other-than-temporary impairment (OTTI) losses on fixed maturity securities held as of September 30, 2018 and 2017 that the Company did not intend to sell as of those dates, and it was not more likely than not that the Company would be required to sell the securities before the anticipated recovery of their amortized cost bases, for which the non-credit portions of OTTI losses were recognized in OCI: ($ in thousands) Nine Months Ended 2018 2017 Cumulative credit loss (1) Beginning of period $ 3,825 $ 13,703 New credit losses — — Increases to previously recognized credit losses 246 1,994 Losses related to securities sold or paid down during the period (2,542 ) (2 ) End of period $ 1,529 $ 15,695 ________________ (1) The cumulative credit loss amounts exclude OTTI losses on securities held as of the periods indicated that the Company intended to sell or it was more likely than not that the Company would be required to sell the securities before the recovery of their amortized cost bases. Maturities/Sales of Fixed Maturity Securities The following table presents the distribution of the Company’s fixed maturity securities portfolio by estimated expected maturity. Estimated expected maturities differ from contractual maturities, reflecting assumptions regarding borrowers’ utilization of the right to call or prepay obligations with or without call or prepayment penalties. For structured securities, including mortgage-backed securities and other asset-backed securities, estimated expected maturities consider broker-dealer survey prepayment assumptions and are verified for consistency with the interest rate and economic environments. ($ in thousands) Percent of Total Fair Value September 30, 2018 September 30, 2018 December 31, 2017 Fair Value Amortized Cost Estimated expected maturity: Due in 1 year or less 4.5 % 3.2 % $ 342,221 $ 339,321 Due after 1 year through 5 years 23.7 26.7 1,783,259 1,758,061 Due after 5 years through 10 years 32.8 32.6 2,469,126 2,464,959 Due after 10 years through 20 years 26.1 24.2 1,962,671 1,929,967 Due after 20 years 12.9 13.3 971,862 927,183 Total 100.0 % 100.0 % $ 7,529,139 $ 7,419,491 Average option-adjusted duration, in years 6.0 5.9 Sales of Fixed Maturity and Equity Securities Proceeds received from sales of fixed maturity and equity securities, each determined using the specific identification method, and gross gains and gross losses realized as a result of those sales for each period were: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Fixed maturity securities Proceeds received $ 170,223 $ 85,841 $ 360,246 $ 315,531 Gross gains realized 3,980 2,293 8,002 8,862 Gross losses realized (5,893 ) (181 ) (7,530 ) (1,558 ) Equity securities Proceeds received $ 2,710 $ 3,514 $ 8,493 $ 20,510 Gross gains realized 885 477 2,478 3,227 Gross losses realized (321 ) (293 ) (502 ) (721 ) Net Investment Gains (Losses) The following table reconciles the net investment gains (losses) pretax by transaction type: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Impairment write-downs $ — $ — $ — $ (1,777 ) Change in intent write-downs (70 ) (6,092 ) (1,357 ) (10,675 ) Net OTTI losses recognized in earnings (70 ) (6,092 ) (1,357 ) — (12,452 ) Sales and other, net (1,331 ) 2,365 2,661 10,050 Change in fair value - equity securities (1) 2,000 — (4,342 ) — Change in fair value and gains (losses) realized on settlements - derivative instruments 2,204 241 4,922 746 Net investment gains (losses) $ 2,803 $ (3,486 ) $ 1,884 — $ (1,656 ) ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, equity securities are reported at fair value with changes in fair value recognized in Net investment gains (losses) and are no longer included in impairment write-downs or change in intent write-downs. Net Unrealized Investment Gains (Losses) on Securities The following table reconciles the net unrealized investment gains (losses), net of tax, included in AOCI, before the impact of DAC: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Net unrealized investment gains (losses) on securities, net of tax Beginning of period $ 144,998 $ 281,465 $ 286,176 $ 202,941 Change in net unrealized investment gains (57,903 ) 12,066 (186,912 ) 91,452 Reclassification of net investment (gains) losses to net income (473 ) 2,422 2,399 1,560 Reclassification of net unrealized gains on equity securities, net of tax, to Retained earnings (1) — — (15,041 ) — End of period $ 86,622 $ 295,953 $ 86,622 $ 295,953 ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, available for sale equity securities were reclassified to equity securities at fair value and the related net unrealized gains were reclassified from AOCI to Retained earnings. Offsetting of Assets and Liabilities The Company’s derivative instruments (call options) are subject to enforceable master netting arrangements. Collateral support agreements associated with each master netting arrangement provide that the Company will receive or pledge financial collateral in the event minimum thresholds have been reached. The following table presents the instruments that were subject to a master netting arrangement for the Company. ($ in thousands) Gross Amounts Offset in the Net Amounts of Assets/ Liabilities Presented in the Gross Amounts Not Offset in the Consolidated Balance Sheets Gross Amounts Consolidated Balance Sheets Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount September 30, 2018 Asset derivatives: Free-standing derivatives $ 10,198 $ — $ 10,198 $ — $ 11,638 $ (1,440 ) December 31, 2017 Asset derivatives: Free-standing derivatives $ 15,550 $ — $ 15,550 $ — $ 15,584 $ (34 ) Deposits At September 30, 2018 and December 31, 2017 , fixed maturity securities with a fair value of $17,676 thousand and $17,985 thousand , respectively, were on deposit with governmental agencies as required by law in various states in which the insurance subsidiaries of HMEC conduct business. In addition, at September 30, 2018 and December 31, 2017 , fixed maturity securities with a fair value of $685,886 thousand and $686,790 thousand , respectively, were on deposit with the Federal Home Loan Bank of Chicago (FHLB) as collateral for amounts subject to funding agreements, advances and borrowings which were equal to $625,000 thousand |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | The Company is required under GAAP to disclose estimated fair values for certain financial and nonfinancial assets and liabilities. Fair values of the Company’s insurance contracts other than annuity contracts are not required to be disclosed. However, the estimated fair values of liabilities under all insurance contracts are taken into consideration in the Company’s overall management of interest rate risk through the matching of investment maturities with amounts due under insurance contracts. Information regarding the three-level hierarchy presented below and the valuation methodologies utilized by the Company to estimate fair values at each reporting date is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 , specifically in Note 3 -- Fair Value of Financial Instruments. Financial Instruments Measured and Carried at Fair Value The following table presents the Company’s fair value hierarchy for those assets and liabilities measured and carried at fair value on a recurring basis. At September 30, 2018 , Level 3 invested assets comprised 3.2% of the Company’s total investment portfolio at fair value. ($ in thousands) Fair Value Measurements at Carrying Fair Reporting Date Using Amount Value Level 1 Level 2 Level 3 September 30, 2018 Financial Assets Investments Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 750,836 $ 750,836 $ — $ 747,469 $ 3,367 Other, including U.S. Treasury securities 782,600 782,600 13,101 769,499 — Municipal bonds 1,883,674 1,883,674 — 1,834,345 49,329 Foreign government bonds 95,003 95,003 — 95,003 — Corporate bonds 2,335,496 2,335,496 13,188 2,233,443 88,865 Other mortgage-backed securities 1,681,530 1,681,530 — 1,561,613 119,917 Total fixed maturity securities 7,529,139 7,529,139 26,289 7,241,372 261,478 Equity securities 133,184 133,184 82,389 — 50,789 — 6 Short-term investments 74,647 74,647 70,705 3,942 — Other investments 22,698 22,698 — 22,698 — Totals $ 7,759,668 $ 7,759,668 $ 179,383 $ 7,318,801 $ 261,484 Financial Liabilities Investment contract and life policy reserves, embedded derivatives $ 722 $ 722 $ — $ 722 $ — Other policyholder funds, embedded derivatives 82,265 82,265 — — 82,265 December 31, 2017 Financial Assets Investments Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 696,725 $ 696,725 $ — $ 693,375 $ 3,350 Other, including U.S. Treasury securities 735,408 735,408 13,393 722,015 — Municipal bonds 1,893,253 1,893,253 — 1,843,925 49,328 Foreign government bonds 102,738 102,738 — 102,738 — Corporate bonds 2,578,954 2,578,954 14,345 2,491,630 72,979 Other mortgage-backed securities 1,716,997 1,716,997 — 1,612,403 104,594 Total fixed maturity securities 7,724,075 7,724,075 27,738 7,466,086 230,251 Equity securities 135,466 135,466 82,208 53,252 6 Short-term investments 62,593 62,593 62,593 — — Other investments 28,050 28,050 — 28,050 — Totals $ 7,950,184 $ 7,950,184 $ 172,539 $ 7,547,388 $ 230,257 Financial Liabilities Investment contract and life policy reserves, embedded derivatives $ 594 $ 594 $ — $ 594 $ — Other policyholder funds, embedded derivatives 80,733 80,733 — — 80,733 During the nine month period ended September 30, 2018 , there were no transfers between Level 1 and Level 2. During the nine month period ended September 30, 2017 , an equity security was transferred into Level 1 from Level 2 as a result of increased liquidity in the market and a sustained increase in the market activity for this asset. The following table presents reconciliations for the periods indicated for all Level 3 assets and liabilities measured at fair value on a recurring basis. ($ in thousands) Financial Assets Financial Liabilities (1) Municipal Bonds Corporate Bonds Other Mortgage- Backed Securities (2) Total Fixed Maturity Securities Equity Securities Short-term Investments Total Beginning balance, July 1, 2018 $ 49,921 $ 92,663 $ 129,061 $ 271,645 $ 6 $ — $ 271,651 $ 77,788 Transfers into Level 3 (3) — — 17,030 17,030 — — 17,030 — Transfers out of Level 3 (3) — — (970 ) (970 ) — — (970 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — — — — — — — — Net (gains) losses included in net income related to financial liabilities — — — — — — — 2,205 Net unrealized investment gains (losses) on securities included in OCI (471 ) 128 (6,184 ) (6,527 ) — — (6,527 ) — Purchases — — — — — — — — Issuances — — — — — — — 3,940 Sales — — (187 ) (187 ) — — (187 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (121 ) (3,926 ) (15,466 ) (19,513 ) — — (19,513 ) (1,668 ) Ending balance, September 30, 2018 $ 49,329 $ 88,865 $ 123,284 $ 261,478 $ 6 $ — $ 261,484 $ 82,265 Beginning balance, January 1, 2018 $ 49,328 $ 72,979 $ 107,944 $ 230,251 $ 6 $ — $ 230,257 $ 80,733 Transfers into Level 3 (3) — 40,487 50,174 90,661 — — 90,661 — Transfers out of Level 3 (3) — (11,279 ) (5,200 ) (16,479 ) — — (16,479 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (246 ) — (246 ) 3 — (243 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — (1,308 ) Net unrealized investment gains (losses) on securities included in OCI 369 (1,459 ) (5,547 ) (6,637 ) — — (6,637 ) — Purchases — — — — — — — — Issuances — — — — — — — 7,379 Sales — — (187 ) (187 ) (3 ) — (190 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (368 ) (11,617 ) (23,900 ) (35,885 ) — — (35,885 ) (4,539 ) Ending balance, September 30, 2018 $ 49,329 $ 88,865 $ 123,284 $ 261,478 $ 6 $ — $ 261,484 $ 82,265 ________________ (1) Represents embedded derivatives, all related to FIA products, reported in Other policyholder funds in the Company’s Consolidated Balance Sheets. (2) Includes U.S. Government and federally sponsored agency obligations for mortgage-backed securities and other mortgage-backed securities. (3) Transfers into and out of Level 3 during the three and nine month periods ended September 30, 2018 were attributable to changes in the availability of observable market information for individual fixed maturity securities. The Company’s policy is to recognize transfers into and transfers out of the levels as having occurred at the end of the reporting period in which the transfers were determined. ($ in thousands) Financial Assets Financial Liabilities (1) Municipal Bonds Corporate Bonds Mortgage- Backed Securities (2) Total Fixed Maturity Securities Equity Securities Short-term Investments Total Beginning balance, July 1, 2017 $ 49,123 $ 77,052 $ 120,324 $ 246,499 $ 6 $ — $ 246,505 $ 67,995 Transfers into Level 3 (3) — 23,501 11,961 35,462 — — 35,462 — Transfers out of Level 3 (3) — 1 (881 ) (880 ) — — (880 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (1 ) (160 ) (161 ) — — (161 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — 2,587 Net unrealized investment gains (losses) on securities included in OCI 382 (192 ) (377 ) (187 ) — — (187 ) — Purchases — — — — — — — — Issuances — — — — — — — 3,752 Sales — (1,999 ) — (1,999 ) — — (1,999 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (293 ) (4,117 ) (9,249 ) (13,659 ) — — (13,659 ) (1,348 ) Ending balance, September 30, 2017 $ 49,212 $ 94,245 $ 121,618 $ 265,075 $ 6 $ — $ 265,081 $ 72,986 Beginning balance, January 1, 2017 $ 46,497 $ 60,191 $ 104,659 $ 211,347 $ 6 $ 751 $ 212,104 $ 59,393 Transfers into Level 3 (3) 5,214 55,420 36,482 97,116 — — 97,116 — Transfers out of Level 3 (3) (5,557 ) (11,962 ) (881 ) (18,400 ) — (751 ) (19,151 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (1 ) (1,874 ) (1,875 ) — — (1,875 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — 6,133 Net unrealized investment gains (losses) on securities included in OCI 3,540 263 1,945 5,748 — — 5,748 — Purchases — — — — — — — — Issuances — — — — — — — 10,538 Sales — (1,999 ) — (1,999 ) — — (1,999 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (482 ) (7,667 ) (18,713 ) (26,862 ) — — (26,862 ) (3,078 ) Ending balance, September 30, 2017 $ 49,212 $ 94,245 $ 121,618 $ 265,075 $ 6 $ — $ 265,081 $ 72,986 ________________ (1) Represents embedded derivatives, all related to FIA products, reported in Other policyholder funds in the Company’s Consolidated Balance Sheets. (2) Includes U.S. Government and federally sponsored agency obligations for mortgage-backed securities and other mortgage-backed securities. (3) Transfers into and out of Level 3 during the three and nine month periods ended September 30, 2017 were attributable to changes in the availability of observable market information for individual fixed maturity securities and short-term investments. The Company’s policy is to recognize transfers into and transfers out of the levels as having occurred at the end of the reporting period in which the transfers were determined. For the nine month period ended September 30, 2018 , the Company realized a net loss of $243 thousand on three Level 3 securities. For the nine month period ended September 30, 2017 , the Company impaired two Level 3 securities for a $1,875 thousand realized loss. For the three and nine month periods ended September 30, 2018 , net investment losses of $2,205 thousand and gains of $1,308 thousand , respectively, were included in earnings that were attributable to the changes in the fair value of Level 3 liabilities (embedded derivatives) still held; for the three and nine month periods ended September 30, 2017 , the respective loss amounts were $2,587 thousand and $6,133 thousand . The valuation techniques and significant unobservable inputs used in the fair value measurement for financial assets and liabilities classified as Level 3 are subject to the control processes as described in Note 3 -- Fair Value of Financial Instruments -- Investments in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . Generally, valuation techniques for fixed maturity securities include spread pricing, matrix pricing and discounted cash flow methodologies; include inputs such as quoted prices for identical or similar securities that are less liquid; and are based on lower levels of trading activity than securities classified as Level 2. The valuation techniques and significant unobservable inputs used in the fair value measurement for equity securities classified as Level 3 use similar valuation techniques and significant unobservable inputs as those used for fixed maturity securities. The sensitivity of the estimated fair values to changes in the significant unobservable inputs for fixed maturity and equity securities included in Level 3 generally relate to interest rate spreads, illiquidity premiums and default rates. Significant spread widening in isolation will adversely impact the overall valuation, while significant spread tightening will lead to substantial valuation increases. Significant increases (decreases) in illiquidity premiums in isolation will result in substantially lower (higher) valuations. Significant increases (decreases) in expected default rates in isolation will result in substantially lower (higher) valuations. Financial Instruments Not Carried at Fair Value; Disclosure Required The Company has various other financial assets and financial liabilities used in the normal course of business that are not carried at fair value, but for which fair value disclosure is required. The following table presents the carrying value, fair value and fair value hierarchy of these financial assets and financial liabilities. ($ in thousands) Fair Value Measurements at Carrying Fair Reporting Date Using Amount Value Level 1 Level 2 Level 3 September 30, 2018 Financial Assets Investments Other investments $ 155,410 $ 160,121 $ — $ — $ 160,121 Financial Liabilities Investment contract and life policy reserves, fixed annuity contracts 4,545,232 4,445,442 — — 4,445,442 Investment contract and life policy reserves, account values on life contracts 85,698 91,254 — — 91,254 Other policyholder funds 640,187 640,187 — 576,021 64,166 Long-term debt 297,671 304,614 — 304,614 — December 31, 2017 Financial Assets Investments Other investments $ 154,898 $ 159,575 $ — $ — $ 159,575 Financial Liabilities Investment contract and life policy reserves, fixed annuity contracts 4,452,972 4,366,334 — — 4,366,334 Investment contract and life policy reserves, 82,911 88,620 — — 88,620 Other policyholder funds 643,528 643,528 — 575,622 67,906 Long-term debt 297,469 311,315 — 311,315 — |
Derivative Instruments
Derivative Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments | The Company offers FIA products, which are deferred fixed annuities that guarantee the return of principal to the contractholder and credit interest based on a percentage of the gain in a specified market index. The Company also offers IUL products which credit interest based on a percentage of the gain in a specified market index. When deposits are received for FIA and IUL contracts, a portion is used to purchase derivatives consisting of call options on the applicable market indices to fund the index credits due to FIA and IUL policyholders. For the Company, substantially all of such call options are one-year options purchased to match the funding requirements of the underlying contracts. The call options are carried at fair value with changes in fair value included in Net investment gains (losses), a component of Revenues, in the Consolidated Statements of Operations. The change in fair value of derivatives includes the gains or losses recognized at the expiration of the option term or early termination and the changes in fair value for open positions. Call options are not purchased to fund the index liabilities which may arise after the next deposit anniversary date. On the respective anniversary dates of the indexed deposits, the index used to compute the annual index credit is reset and new one-year call options are purchased to fund the next annual index credit. The cost of these purchases is managed through the terms of the FIA and IUL contracts, which permit changes to index return caps, participation rates and/or asset fees, subject to guaranteed minimums on each contract’s anniversary date. By adjusting the index return caps, participation rates or asset fees, crediting rates generally can be managed except in cases where the contractual features would prevent further modifications. The future annual index credits on FIA contracts are treated as a "series of embedded derivatives" over the expected life of the applicable contract with a corresponding reserve recorded. For IUL, the embedded derivative represents a single year liability for the index return. The Company carries all derivative instruments at fair value in the Consolidated Balance Sheets. The Company elected to not use hedge accounting for derivative transactions related to the FIA and IUL products. As a result, the Company recognizes the purchased call options and the embedded derivatives related to the provision of a contingent return at fair value, with changes in the fair value of the derivatives recognized immediately as Net investment gains (losses) in the Consolidated Statements of Operations. The fair values of derivative instruments, including derivative instruments embedded in FIA and IUL contracts, are presented in the Consolidated Balance Sheets as follows: ($ in thousands) September 30, 2018 December 31, 2017 Assets Derivative instruments, included in Short-term and other investments $ 10,198 $ 15,550 Liabilities FIA - embedded derivatives, included in Other policyholder funds $ 82,265 $ 80,733 IUL - embedded derivatives, included in Investment contract and life policy reserves 722 594 In general, the change in the fair value of the embedded derivatives related to FIA contracts will not correspond to the change in fair value of the purchased call options because the purchased call options are one-year options while the options valued in the embedded derivatives represent the rights of the policyholder to receive index credits over the entire period the FIA contracts are expected to be in force, which typically exceeds 10 years. The changes in fair value of derivatives included in the Consolidated Statements of Operations were as follows: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Change in fair value of derivatives: (1) Revenues Net investment gains (losses) $ 4,683 $ 2,943 $ 3,832 $ 7,109 Change in fair value of embedded derivatives: Revenues Net investment gains (losses) $ (2,479 ) $ (2,702 ) $ 1,090 $ (6,363 ) ________________ (1) Includes the gains or losses recognized at the expiration of the option term or early termination and the changes in fair value for open options. The Company’s strategy attempts to mitigate potential risk of loss under these agreements through a regular monitoring process, which evaluates the program’s effectiveness. The Company is exposed to risk of loss in the event of nonperformance by the counterparties and, accordingly, option contracts are purchased from multiple counterparties, which are evaluated for creditworthiness prior to purchase of the contracts. All of these options have been purchased from nationally recognized financial institutions with a Standard and Poor’s Financial Services LLC (S&P) and/or Moody's Investors Service (Moody's) long-term credit rating of "BBB+/Bbb1" or higher at the time of purchase and the maximum credit exposure to any single counterparty is subject to concentration limits. The Company also obtains credit support agreements that allow it to request the counterparty to provide collateral when the fair value of the exposure to the counterparty exceeds specified amounts. The notional amount and fair value of call options by counterparty and each counterparty’s long-term credit ratings were as follows: ($ in thousands) September 30, 2018 December 31, 2017 Credit Rating Notional Fair Notional Fair Counterparty S&P Moody's Amount Value Amount Value Bank of America, N.A. A+ Aa3 $ 135,600 $ 6,144 $ 85,100 $ 6,320 Barclays Bank PLC A A2 26,200 586 48,900 1,828 Citigroup Inc. BBB+ — — — — Credit Suisse International A A1 16,100 307 21,100 1,444 Societe Generale A 92,000 3,161 91,700 5,958 Total $ 269,900 $ 10,198 $ 246,800 $ 15,550 As of September 30, 2018 and December 31, 2017 , the Company held $11,638 thousand and $15,584 thousand , respectively, of cash received from counterparties for derivative collateral, which is included in Other liabilities on the Consolidated Balance Sheets. This derivative collateral limits the Company’s maximum amount of economic loss due to credit risk that would be incurred if parties to the call options failed completely to perform according to the terms of the contracts to $250 thousand |
Property and Casualty Unpaid Cl
Property and Casualty Unpaid Claims and Claim Expenses | 9 Months Ended |
Sep. 30, 2018 | |
Insurance Loss Reserves [Abstract] | |
Property and Casualty Unpaid Claims and Claim Expenses | The following table is a summary reconciliation of the beginning and ending Property and Casualty unpaid claims and claim expense reserves for the periods indicated. The table presents reserves on both gross and net (after reinsurance) bases. The total net Property and Casualty insurance claims and claim expense incurred amounts are reflected in the Consolidated Statements of Operations. The end of the period gross reserve (before reinsurance) balances and the reinsurance recoverable balances are reflected on a gross basis in the Consolidated Balance Sheets. ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Property and Casualty Beginning gross reserves (1) $ 352,817 $ 329,831 $ 319,182 $ 307,757 Less: reinsurance recoverables 62,883 58,897 57,409 61,199 Net reserves, beginning of period (2) 289,934 270,934 261,773 246,558 Incurred claims and claim expenses: Claims occurring in the current period 140,035 115,393 408,028 386,945 Decrease in estimated reserves for claims occurring in prior periods (3) — (500 ) (300 ) (2,100 ) Total claims and claim expenses incurred (4) 140,035 114,893 407,728 384,845 Claims and claim expense payments for claims occurring during: Current period 106,187 97,188 233,638 245,213 Prior periods 28,997 28,054 141,078 125,605 Total claims and claim expense payments 135,184 125,242 374,716 370,818 Net reserves, end of period (2) 294,785 260,585 294,785 260,585 Plus: reinsurance recoverables 63,262 57,302 63,262 57,302 Ending gross reserves (1) $ 358,047 $ 317,887 $ 358,047 $ 317,887 ________________ (1) Unpaid claims and claim expenses as reported in the Consolidated Balance Sheets also include reserves for Life and Retirement of $26,589 thousand and $23,897 thousand as of September 30, 2018 and 2017 , respectively, in addition to Property and Casualty reserves. (2) Reserves net of anticipated reinsurance recoverables. (3) Shows the amounts by which the Company decreased its reserves in each of the periods indicated for claims occurring in previous periods to reflect subsequent information on such claims and changes in their projected final settlement costs. (4) Benefits, claims and settlement expenses as reported in the Consolidated Statements of Operations also include amounts for Life and Retirement of $21,811 thousand and $65,958 thousand for the three and nine month periods ended September 30, 2018 , respectively, in addition to Property and Casualty amounts. Benefits, claims and settlement expenses for Life and Retirement were $20,002 thousand and $60,025 thousand for the three and nine month periods ended September 30, 2017 , respectively. Net favorable development of total reserves for Property and Casualty claims occurring in prior years was $300 thousand and $2,100 thousand for the nine month periods ended September 30, 2018 and 2017 , respectively. The favorable development for both of the nine month periods ended September 30, 2018 and 2017 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Debt | Indebtedness outstanding was as follows: ($ in thousands) September 30, 2018 December 31, 2017 Short-term debt: Bank Credit Facility, expires June 27, 2023 $ — $ — Long-term debt: 4.50% Senior Notes, due December 1, 2025. Aggregate principal amount of $250,000 thousand less unaccrued discount of $503 and $547 thousand (4.5% imputed rate) and unamortized debt issuance costs of $1,826 thousand and $1,984 thousand 247,671 247,469 Federal Home Loan Bank borrowing 50,000 50,000 Total $ 297,671 $ 297,469 The Credit Agreement with certain financial institutions (Bank Credit Facility), 4.50% Senior Notes due 2025 (Senior Notes due 2025) and FHLB borrowing are described in Notes to Consolidated Financial Statements -- Note 7 -- Debt of the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . Credit Agreement with Financial Institutions (Bank Credit Facility ) Effective June 27, 2018, the Bank Credit Facility was amended and restated to extend the commitment termination date to June 27, 2023 from the previous termination date of July 30, 2019. The interest rate spread relative to Eurodollar base rates and the financial covenants within the agreement were not changed. The Bank Credit Facility is by and between HMEC, certain financial institutions named therein and JPMorgan Chase Bank, N.A., as administrative agent, and provides for unsecured borrowings of up to $150 million . Interest accrues at varying spreads relative to prime or Eurodollar base rates and is payable monthly or quarterly depending on the applicable base rate (Eurodollar base rate plus 1.15% ). The unused portion of the Bank Credit Facility is subject to a variable commitment fee, which was 0.15% on an annual basis at September 30, 2018 . HMEC had no balance outstanding under its Bank Credit Facility at September 30, 2018 |
Reinsurance
Reinsurance | 9 Months Ended |
Sep. 30, 2018 | |
Insurance [Abstract] | |
Reinsurance | The Company recognizes the cost of reinsurance premiums over the contract periods for such premiums in proportion to the insurance protection provided. Amounts recoverable from reinsurers for unpaid claims and claim settlement expenses, including estimated amounts for unsettled claims, claims incurred but not yet reported and policy benefits, are estimated in a manner consistent with the insurance liability associated with the policy. The effects of reinsurance on premiums written and contract deposits; premiums and contract charges earned; and benefits, claims and settlement expenses were as follows: ($ in thousands) Gross Amount Ceded to Other Companies Assumed from Other Companies Net Amount Three months ended September 30, 2018 Premiums written and contract deposits (1) $ 342,268 $ 5,370 $ 1,199 $ 338,097 Premiums and contract charges earned 210,953 5,385 1,252 206,820 Benefits, claims and settlement expenses 163,912 3,207 1,141 161,846 Three months ended September 30, 2017 Premiums written and contract deposits (1) $ 322,428 $ 5,189 $ 1,116 $ 318,355 Premiums and contract charges earned 202,988 5,216 1,163 198,935 Benefits, claims and settlement expenses 135,508 1,831 1,218 134,895 Nine months ended September 30, 2018 Premiums written and contract deposits (1) $ 936,948 $ 16,367 $ 3,246 $ 923,827 Premiums and contract charges earned 628,582 16,418 3,264 615,428 Benefits, claims and settlement expenses 486,339 15,551 2,898 473,686 Nine months ended September 30, 2017 Premiums written and contract deposits (1) $ 940,063 $ 16,342 $ 2,980 $ 926,701 Premiums and contract charges earned 603,794 16,415 2,996 590,375 Benefits, claims and settlement expenses 450,997 8,899 2,772 444,870 ________________ (1) |
Commitments
Commitments | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments | Investment Commitments From time to time, the Company has outstanding commitments to purchase investments and/or commitments to lend funds under bridge loans. Unfunded commitments to purchase investments were $124,577 thousand and $106,381 thousand at September 30, 2018 and December 31, 2017 |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Segment Information | The Company conducts and manages its business through four segments. The three operating segments, representing the major lines of insurance business, are: Property and Casualty, primarily personal lines automobile and property insurance products; Retirement, primarily tax-qualified fixed and variable annuities; and Life, life insurance. The Company does not allocate the impact of corporate-level transactions to these operating segments, consistent with the basis for management’s evaluation of the results of those segments, but classifies those items in the fourth segment, Corporate and Other. In addition to ongoing transactions such as corporate debt service, net investment gains (losses) certain public company expenses, such items also have included corporate debt retirement costs, when applicable. Summarized financial information for these segments is as follows: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Insurance premiums and contract charges earned Property and Casualty $ 168,653 $ 163,209 $ 501,444 $ 481,987 Retirement 8,031 7,393 23,924 20,753 Life 30,136 28,333 90,060 87,635 Total $ 206,820 $ 198,935 $ 615,428 $ 590,375 Net investment income Property and Casualty $ 12,361 $ 9,167 $ 32,177 $ 26,457 Retirement 67,750 64,340 199,706 192,921 Life 19,123 18,999 56,629 56,215 Corporate and Other 41 17 119 47 Intersegment eliminations (192 ) (203 ) (583 ) (615 ) Total $ 99,083 $ 92,320 $ 288,048 $ 275,025 Net income (loss) Property and Casualty $ (3,190 ) $ 13,407 $ (4,364 ) $ 2,186 Retirement 12,120 13,603 37,682 36,933 Life 5,331 4,788 14,997 14,283 Corporate and Other (1,733 ) (5,247 ) (9,715 ) (9,272 ) Total $ 12,528 $ 26,551 $ 38,600 $ 44,130 ($ in thousands) September 30, 2018 December 31, 2017 Assets Property and Casualty $ 1,241,538 $ 1,217,394 Retirement 8,143,384 8,063,912 Life 1,787,361 1,815,732 Corporate and Other 146,593 143,784 Intersegment eliminations (38,111 ) (42,482 ) Total $ 11,280,765 $ 11,198,340 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | On December 22, 2017, comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the Tax Act) was enacted by the U.S. government. The Tax Act is generally effective January 1, 2018, and among other changes, reduced the federal corporate income tax rate from 35% to 21%, eliminated the corporate Alternative Minimum Tax, modified numerous insurance-specific provisions, and further limited deductions for executive compensation. The Tax Act reduced the Company’s effective tax rate by 8.8% for the nine month period ended September 30, 2018 |
Proposed Acquisition of Benefit
Proposed Acquisition of Benefit Consultants Group, Inc. (BCG) | 9 Months Ended |
Sep. 30, 2018 | |
Business Combinations [Abstract] | |
Proposed Acquisition of Benefit Consultants Group, Inc. (BCG) | Note 11 - Proposed Acquisition of Benefit Consultants Group, Inc. (BCG) On October 30, 2018, the Company and BCG entered into a Stock Purchase Agreement under which the Company will acquire all of the outstanding capital stock of BCG for $25.0 million |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements of Horace Mann Educators Corporation (HMEC; and together with its subsidiaries, the Company or Horace Mann) have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP) and with the rules and regulations of the Securities and Exchange Commission (SEC), specifically Regulation S-X and the instructions to Form 10-Q. Certain information and disclosures normally included in annual financial statements prepared in conformity with GAAP, but are not required for interim reporting purposes, have been omitted. The Company believes that these consolidated financial statements contain all adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary to present fairly the Company’s consolidated financial position as of September 30, 2018 , the consolidated results of operations and comprehensive income (loss) for the three and nine month periods ended September 30, 2018 and 2017 and the consolidated changes in shareholders’ equity and cash flows for the nine month periods ended September 30, 2018 and 2017 . The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The subsidiaries of HMEC market and underwrite personal lines of property and casualty insurance products (primarily personal lines of automobile and property insurance), retirement products (primarily tax-qualified annuities) and life insurance, primarily to K-12 teachers, administrators and other employees of public schools and their families. HMEC’s principal operating subsidiaries are Horace Mann Life Insurance Company, Horace Mann Insurance Company, Teachers Insurance Company, Horace Mann Property & Casualty Insurance Company and Horace Mann Lloyds. These consolidated financial statements should be read in conjunction with the consolidated financial statements and the related notes to consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 . The results of operations for the three and nine month period ended September 30, 2018 are not necessarily indicative of the results to be expected for the full year. The Company has reclassified the presentation of certain prior period information to conform to the current presentation. |
Accumulated Other Comprehensive Income (Loss) | Comparative information for elements that are not required to be reclassified in their entirety to Net income in the same reporting period is located in Note 2 -- Investments -- Net Unrealized Investment Gains (Losses) on Securities.Accumulated Other Comprehensive Income (Loss) |
Adopted and Pending Accounting Standards | Adopted Accounting Standards Revenue Recognition In May 2014, the Financial Accounting Standards Board (FASB) issued accounting guidance, with an effective date that was deferred to January 1, 2018, to provide a single comprehensive model in accounting for revenue arising from contracts with customers. The guidance applies to all contracts with customers; however, certain insurance contracts are specifically excluded from this updated guidance. The Company adopted the guidance on January 1, 2018, using the modified retrospective transition method. The guidance did not have an impact on the Company’s consolidated financial position, results of operations, cash flows, or disclosures. Recognition and Measurement of Financial Assets and Liabilities In January 2016, the FASB issued accounting guidance to improve certain aspects of the recognition, measurement, presentation and disclosure of financial instruments. Among other things, the guidance revises the accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. The Company adopted the guidance on January 1, 2018 using the modified retrospective approach that resulted in reclassifying $15,041 thousand of after tax net unrealized gains on equity securities from AOCI to Retained earnings. The Company's Consolidated Statements of Operations were impacted as changes in fair value of equity securities are now being reported in Net investment gains (losses) instead of reported in other comprehensive income (loss) (OCI). Statement of Cash Flows -- Classification In August 2016, the FASB issued guidance to reduce diversity in practice in the statement of cash flows between operating, investing and financing activities related to the classification of cash receipts and cash payments for eight specific issues. The FASB acknowledged that current GAAP either is unclear or does not include specific guidance on these eight cash flow classification issues: (1) debt prepayment or extinguishment costs; (2) settlement of zero-coupon bonds (pertains to issuers); (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims (pertains to claimants); (5) proceeds from the settlement of corporate-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions (pertains to transferors) and (8) separately identifiable cash flows and application of the predominance principle. The Company adopted the guidance on January 1, 2018 using a retrospective approach which had no impact to the prior year amounts reported in the Consolidated Statement of Cash Flows. Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income (Loss) On February 14, 2018, the FASB issued accounting guidance that permits recognition of a reclassification adjustment between AOCI and Retained earnings for stranded tax amounts related to the reduced corporate tax rate enacted under the Tax Act. As permitted under its provisions, the Company early adopted the accounting guidance effective for the quarterly period that ended December 31, 2017 and elected to reclassify the stranded tax amounts. The impact from early adoption resulted in an increase to AOCI and a reduction to Retained earnings of approximately $47,900 thousand ; representing the stranded deferred tax liabilities of $50,034 thousand and $(2,134) thousand for Net unrealized investment gains (losses) on securities and Net funded status of benefit plans, respectively. Pending Accounting Standards Accounting for Leases In February 2016, the FASB issued accounting and disclosure guidance to improve financial reporting and comparability among organizations about leasing transactions. Under the new guidance, for leases with lease terms of more than 12 months, a lessee will be required to recognize assets and liabilities on the balance sheet for the rights and obligations created by those leases. Consistent with current accounting guidance, the recognition, measurement and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or an operating lease. However, while current guidance requires only capital leases to be recognized on the balance sheet, the new guidance will require both operating and capital leases to be recognized on the balance sheet. This new guidance is effective for annual reporting periods beginning December 15, 2018, and interim reporting periods within those annual periods, with early adoption permitted. The Company will adopt this new guidance on January 1, 2019, and the Company expects to use the optional transition method, which allows the Company to recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption (i.e., comparative periods presented in the consolidated financial statements will continue to be in conformity with current GAAP). While the Company is in the process of evaluating the impact of the guidance, it does not expect the guidance to have a material impact on its consolidated financial statements. Had the Company adopted the guidance on September 30, 2018 , it would have recognized additional operating liabilities of $13,267 thousand , with corresponding right of use assets of the same amount based on the present value of the expected remaining lease payments under the new guidance. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued guidance to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments, including reinsurance receivables, held by companies. The new guidance replaces the incurred loss impairment methodology and requires an organization to measure and recognize all current expected credit losses (CECL) for financial assets held at the reporting date based on historical experience, current conditions, and reasonable and supportable forecasts. Companies will need to utilize forward-looking information to better inform their credit loss estimates. Companies will continue to use judgment to determine which loss estimation method is appropriate for their circumstances. Any credit losses related to available for sale debt securities will be recorded through an allowance for credit losses with this allowance having a limit equal to the amount by which fair value is below amortized cost. The guidance also requires enhanced qualitative and quantitative disclosures to provide additional information about the amounts recorded in the financial statements. For public business entities, the guidance is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those years, using a modified-retrospective approach. Early application is permitted for annual reporting periods, and interim periods within those years, beginning after December 15, 2018. Management is evaluating the impact this guidance will have on the results of operations and financial position of the Company. Simplifying the Test for Goodwill Impairment In January 2017, the FASB issued guidance to simplify the accounting for goodwill impairment. The guidance removes Step 2 of the goodwill impairment test, which requires a hypothetical purchase price allocation. A goodwill impairment will now be the amount by which a reporting unit's carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. All other goodwill impairment guidance will remain largely unchanged. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. The same one-step impairment test will be applied to goodwill at all reporting units, even those with zero or negative carrying amounts. Entities will be required to disclose the amount of goodwill for reporting units with zero or negative carrying amounts. Public business entities should adopt the guidance prospectively for its annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. Early application is permitted. Management believes the adoption of this accounting guidance will not have a material effect on the results of operations and financial position of the Company. Accounting for Long-Duration Insurance Contracts |
Basis of Presentation (Tables)
Basis of Presentation (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Investment Contract And Life Policy Reserves | This table summarizes the Company’s investment contract and life policy reserves. ($ in thousands) September 30, 2018 December 31, 2017 Investment contract reserves $ 4,545,232 $ 4,452,972 Life policy reserves 1,145,457 1,120,763 Total $ 5,690,689 $ 5,573,735 |
Accumulated Other Comprehensive Income (Loss) | The following tables reconcile these components. ($ in thousands) Net Unrealized Investment Gains (Losses) on Securities (1)(2) Net Funded Status of Benefit Plans (1) Total (1) Beginning balance, July 1, 2018 $ 125,596 $ (13,217 ) $ 112,379 Other comprehensive income (loss) before reclassifications (49,165 ) — (49,165 ) Amounts reclassified from accumulated other comprehensive income (loss) (473 ) — (473 ) Cumulative effect of change in accounting principle — — — Net current period other comprehensive income (loss) (49,638 ) — (49,638 ) Ending balance, September 30, 2018 $ 75,958 $ (13,217 ) $ 62,741 Beginning balance, January 1, 2018 $ 300,177 $ (13,217 ) $ 286,960 Other comprehensive income (loss) before reclassifications (211,577 ) — (211,577 ) Amounts reclassified from accumulated other comprehensive income (loss) 2,399 — 2,399 Cumulative effect of change in accounting principle (3) (15,041 ) — (15,041 ) Net current period other comprehensive income (loss) (224,219 ) — (224,219 ) Ending balance, September 30, 2018 $ 75,958 $ (13,217 ) $ 62,741 ________________ (1) All amounts are net of tax. (2) The pretax amounts reclassified from AOCI, $599 thousand and $(3,037) thousand , are included in Net investment gains (losses) and the related income tax expenses, $126 thousand and $(638) thousand , are included in Income tax expense in the Consolidated Statements of Operations for the three and nine month periods ended September 30, 2018 , respectively. (3) The Company adopted guidance on January 1, 2018 that resulted in reclassifying $15,041 thousand of after tax net unrealized gains on equity securities from AOCI to Retained earnings. ($ in thousands) Net Unrealized Investment Gains (Losses) on Securities (1)(2) Net Funded Status of Benefit Plans (1) Total (1) Beginning balance, July 1, 2017 $ 243,510 $ (11,817 ) $ 231,693 Other comprehensive income (loss) before reclassifications 9,786 — 9,786 Amounts reclassified from accumulated other comprehensive income (loss) 2,422 — 2,422 Net current period other comprehensive income (loss) 12,208 — 12,208 Ending balance, September 30, 2017 $ 255,718 $ (11,817 ) $ 243,901 Beginning balance, January 1, 2017 $ 175,738 $ (11,817 ) $ 163,921 Other comprehensive income (loss) before reclassifications 78,419 — 78,419 Amounts reclassified from accumulated other comprehensive income (loss) 1,561 — 1,561 Net current period other comprehensive income (loss) 79,980 — 79,980 Ending balance, September 30, 2017 $ 255,718 $ (11,817 ) $ 243,901 ________________ (1) All amounts are net of tax. (2) The pretax amounts reclassified from AOCI, $(3,726) thousand and $(2,401) thousand , are included in Net investment gains (losses) and the related income tax expenses, $(1,304) thousand and $(840) thousand , are included in Income tax expense in the Consolidated Statements of Operations for the three and nine month periods ended September 30, 2017 , respectively. |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |
Unrealized gains and losses on fixed maturities and equity securities | The amortized cost, net unrealized investment gains (losses) and fair values of all fixed maturity securities in the portfolio were as follows: ($ in thousands) Amortized Cost/Cost Unrealized Investment Gains Unrealized Investment Losses Fair Value September 30, 2018 (1) Fixed maturity securities U.S. Government and federally sponsored agency obligations: (2) Mortgage-backed securities $ 758,301 $ 15,744 $ 23,209 $ 750,836 Other, including U.S. Treasury securities 802,508 12,528 32,436 782,600 Municipal bonds 1,783,711 119,671 19,708 1,883,674 Foreign government bonds 92,860 2,787 644 95,003 Corporate bonds 2,290,452 74,409 29,365 2,335,496 Other mortgage-backed securities 1,691,659 8,073 18,202 1,681,530 Totals $ 7,419,491 $ 233,212 $ 123,564 $ 7,529,139 December 31, 2017 Fixed maturity securities U.S. Government and federally sponsored agency obligations: (2) Mortgage-backed securities $ 669,297 $ 30,460 $ 3,032 $ 696,725 Other, including U.S. Treasury securities 714,613 26,311 5,516 735,408 Municipal bonds 1,711,581 184,107 2,435 1,893,253 Foreign government bonds 96,780 5,958 — 102,738 Corporate bonds 2,409,426 173,862 4,334 2,578,954 Other mortgage-backed securities 1,701,253 22,935 7,191 1,716,997 Totals $ 7,302,950 $ 443,633 $ 22,508 $ 7,724,075 Equity securities (3) $ 116,320 $ 19,425 $ 279 $ 135,466 ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, available for sale equity securities were reclassified to equity securities at fair value and are excluded from the table above as of September 30, 2018. (2) Fair value includes securities issued by Federal National Mortgage Association (FNMA) of $408,130 thousand and $361,955 thousand ; Federal Home Loan Mortgage Corporation (FHLMC) of $408,858 thousand and $400,001 thousand ; and Government National Mortgage Association (GNMA) of $96,018 thousand and $104,168 thousand as of September 30, 2018 and December 31, 2017 , respectively. (3) Includes nonredeemable (perpetual) preferred stocks, common stocks and closed-end funds. |
Summary of fair value and gross unrealized losses of fixed maturity securities and equity securities in an unrealized loss position | The following table presents the fair value and gross unrealized losses of securities in an unrealized loss position at September 30, 2018 and December 31, 2017 , respectively. The Company views the decrease in value of all of the securities with unrealized losses at September 30, 2018 -- which was driven largely by increasing interest rates, spread widening, financial market illiquidity and/or market volatility from the date of acquisition -- as temporary. For fixed maturity securities, management does not have the intent to sell the securities and it is not more likely than not the Company will be required to sell the securities before the anticipated recovery of their amortized cost bases, and management expects to recover the entire amortized cost bases of the fixed maturity securities. Therefore, it was determined that the unrealized losses on the securities presented in the table below were not other than temporarily impaired as of September 30, 2018 . ($ in thousands) 12 Months or Less More than 12 Months Total Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses September 30, 2018 (1) Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 330,285 $ 13,484 $ 99,483 $ 9,725 $ 429,768 $ 23,209 Other 450,713 18,510 163,569 13,926 614,282 32,436 Municipal bonds 491,680 13,484 75,678 6,224 567,358 19,708 Foreign government bonds 19,856 644 — — 19,856 644 Corporate bonds 821,190 20,801 90,998 8,564 912,188 29,365 Other mortgage-backed securities 902,673 10,207 252,739 7,995 1,155,412 18,202 Total $ 3,016,397 $ 77,130 $ 682,467 $ 46,434 $ 3,698,864 $ 123,564 Number of positions with a gross unrealized loss 1,237 246 1,483 Fair value as a percentage of total fixed maturity securities fair value 39.4 % 8.9 % 48.3 % December 31, 2017 Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 134,032 $ 1,053 $ 40,606 $ 1,979 $ 174,638 $ 3,032 Other 168,634 1,849 122,753 3,667 291,387 5,516 Municipal bonds 29,437 100 79,140 2,335 108,577 2,435 Foreign government bonds — — — — — — Corporate bonds 115,113 2,701 36,081 1,633 151,194 4,334 Other mortgage-backed securities 457,166 2,791 168,972 4,400 626,138 7,191 Total fixed maturity securities 904,382 8,494 447,552 14,014 1,351,934 22,508 Equity securities (2) 6,027 249 1,277 30 7,304 279 Combined totals $ 910,409 $ 8,743 $ 448,829 $ 14,044 $ 1,359,238 $ 22,787 Number of positions with a gross unrealized loss 354 158 512 Fair value as a percentage of total fixed maturity and equity securities fair value 11.6 % 5.7 % 17.3 % ________________ (1) Effective January 1, 2018, with the adoption of new accounting guidance for recognition and measurement of financial instruments, available for sale equity securities were reclassified to equity securities at fair value and are excluded from the table above as of September 30, 2018. (2) Includes nonredeemable (perpetual) preferred stocks, common stocks and closed-end funds. |
Summary of cumulative credit losses | The following table summarizes the cumulative amounts related to the Company’s credit loss component of other-than-temporary impairment (OTTI) losses on fixed maturity securities held as of September 30, 2018 and 2017 that the Company did not intend to sell as of those dates, and it was not more likely than not that the Company would be required to sell the securities before the anticipated recovery of their amortized cost bases, for which the non-credit portions of OTTI losses were recognized in OCI: ($ in thousands) Nine Months Ended 2018 2017 Cumulative credit loss (1) Beginning of period $ 3,825 $ 13,703 New credit losses — — Increases to previously recognized credit losses 246 1,994 Losses related to securities sold or paid down during the period (2,542 ) (2 ) End of period $ 1,529 $ 15,695 ________________ (1) |
Distribution of the Company's fixed maturity portfolio by estimated expected maturity | The following table presents the distribution of the Company’s fixed maturity securities portfolio by estimated expected maturity. Estimated expected maturities differ from contractual maturities, reflecting assumptions regarding borrowers’ utilization of the right to call or prepay obligations with or without call or prepayment penalties. For structured securities, including mortgage-backed securities and other asset-backed securities, estimated expected maturities consider broker-dealer survey prepayment assumptions and are verified for consistency with the interest rate and economic environments. ($ in thousands) Percent of Total Fair Value September 30, 2018 September 30, 2018 December 31, 2017 Fair Value Amortized Cost Estimated expected maturity: Due in 1 year or less 4.5 % 3.2 % $ 342,221 $ 339,321 Due after 1 year through 5 years 23.7 26.7 1,783,259 1,758,061 Due after 5 years through 10 years 32.8 32.6 2,469,126 2,464,959 Due after 10 years through 20 years 26.1 24.2 1,962,671 1,929,967 Due after 20 years 12.9 13.3 971,862 927,183 Total 100.0 % 100.0 % $ 7,529,139 $ 7,419,491 Average option-adjusted duration, in years 6.0 5.9 |
Proceeds received from sales of fixed maturities and equity securities | Proceeds received from sales of fixed maturity and equity securities, each determined using the specific identification method, and gross gains and gross losses realized as a result of those sales for each period were: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Fixed maturity securities Proceeds received $ 170,223 $ 85,841 $ 360,246 $ 315,531 Gross gains realized 3,980 2,293 8,002 8,862 Gross losses realized (5,893 ) (181 ) (7,530 ) (1,558 ) Equity securities Proceeds received $ 2,710 $ 3,514 $ 8,493 $ 20,510 Gross gains realized 885 477 2,478 3,227 Gross losses realized (321 ) (293 ) (502 ) (721 ) |
Net Realized Investment Gains (Losses) | The following table reconciles the net investment gains (losses) pretax by transaction type: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Impairment write-downs $ — $ — $ — $ (1,777 ) Change in intent write-downs (70 ) (6,092 ) (1,357 ) (10,675 ) Net OTTI losses recognized in earnings (70 ) (6,092 ) (1,357 ) — (12,452 ) Sales and other, net (1,331 ) 2,365 2,661 10,050 Change in fair value - equity securities (1) 2,000 — (4,342 ) — Change in fair value and gains (losses) realized on settlements - derivative instruments 2,204 241 4,922 746 Net investment gains (losses) $ 2,803 $ (3,486 ) $ 1,884 — $ (1,656 ) ________________ (1) |
Reconciliation of net unrealized investment gains (losses) on fixed maturity securities and equity securities | The following table reconciles the net unrealized investment gains (losses), net of tax, included in AOCI, before the impact of DAC: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Net unrealized investment gains (losses) on securities, net of tax Beginning of period $ 144,998 $ 281,465 $ 286,176 $ 202,941 Change in net unrealized investment gains (57,903 ) 12,066 (186,912 ) 91,452 Reclassification of net investment (gains) losses to net income (473 ) 2,422 2,399 1,560 Reclassification of net unrealized gains on equity securities, net of tax, to Retained earnings (1) — — (15,041 ) — End of period $ 86,622 $ 295,953 $ 86,622 $ 295,953 ________________ (1) |
Offsetting assets and liability | The following table presents the instruments that were subject to a master netting arrangement for the Company. ($ in thousands) Gross Amounts Offset in the Net Amounts of Assets/ Liabilities Presented in the Gross Amounts Not Offset in the Consolidated Balance Sheets Gross Amounts Consolidated Balance Sheets Consolidated Balance Sheets Financial Instruments Cash Collateral Received Net Amount September 30, 2018 Asset derivatives: Free-standing derivatives $ 10,198 $ — $ 10,198 $ — $ 11,638 $ (1,440 ) December 31, 2017 Asset derivatives: Free-standing derivatives $ 15,550 $ — $ 15,550 $ — $ 15,584 $ (34 ) |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Summary of Company's fair value hierarchy measured at recurring basis | The following table presents the Company’s fair value hierarchy for those assets and liabilities measured and carried at fair value on a recurring basis. At September 30, 2018 , Level 3 invested assets comprised 3.2% of the Company’s total investment portfolio at fair value. ($ in thousands) Fair Value Measurements at Carrying Fair Reporting Date Using Amount Value Level 1 Level 2 Level 3 September 30, 2018 Financial Assets Investments Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 750,836 $ 750,836 $ — $ 747,469 $ 3,367 Other, including U.S. Treasury securities 782,600 782,600 13,101 769,499 — Municipal bonds 1,883,674 1,883,674 — 1,834,345 49,329 Foreign government bonds 95,003 95,003 — 95,003 — Corporate bonds 2,335,496 2,335,496 13,188 2,233,443 88,865 Other mortgage-backed securities 1,681,530 1,681,530 — 1,561,613 119,917 Total fixed maturity securities 7,529,139 7,529,139 26,289 7,241,372 261,478 Equity securities 133,184 133,184 82,389 — 50,789 — 6 Short-term investments 74,647 74,647 70,705 3,942 — Other investments 22,698 22,698 — 22,698 — Totals $ 7,759,668 $ 7,759,668 $ 179,383 $ 7,318,801 $ 261,484 Financial Liabilities Investment contract and life policy reserves, embedded derivatives $ 722 $ 722 $ — $ 722 $ — Other policyholder funds, embedded derivatives 82,265 82,265 — — 82,265 December 31, 2017 Financial Assets Investments Fixed maturity securities U.S. Government and federally sponsored agency obligations: Mortgage-backed securities $ 696,725 $ 696,725 $ — $ 693,375 $ 3,350 Other, including U.S. Treasury securities 735,408 735,408 13,393 722,015 — Municipal bonds 1,893,253 1,893,253 — 1,843,925 49,328 Foreign government bonds 102,738 102,738 — 102,738 — Corporate bonds 2,578,954 2,578,954 14,345 2,491,630 72,979 Other mortgage-backed securities 1,716,997 1,716,997 — 1,612,403 104,594 Total fixed maturity securities 7,724,075 7,724,075 27,738 7,466,086 230,251 Equity securities 135,466 135,466 82,208 53,252 6 Short-term investments 62,593 62,593 62,593 — — Other investments 28,050 28,050 — 28,050 — Totals $ 7,950,184 $ 7,950,184 $ 172,539 $ 7,547,388 $ 230,257 Financial Liabilities Investment contract and life policy reserves, embedded derivatives $ 594 $ 594 $ — $ 594 $ — Other policyholder funds, embedded derivatives 80,733 80,733 — — 80,733 |
Table for reconciliations for all Level 3 assets measured at fair value on a recurring basis | The following table presents reconciliations for the periods indicated for all Level 3 assets and liabilities measured at fair value on a recurring basis. ($ in thousands) Financial Assets Financial Liabilities (1) Municipal Bonds Corporate Bonds Other Mortgage- Backed Securities (2) Total Fixed Maturity Securities Equity Securities Short-term Investments Total Beginning balance, July 1, 2018 $ 49,921 $ 92,663 $ 129,061 $ 271,645 $ 6 $ — $ 271,651 $ 77,788 Transfers into Level 3 (3) — — 17,030 17,030 — — 17,030 — Transfers out of Level 3 (3) — — (970 ) (970 ) — — (970 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — — — — — — — — Net (gains) losses included in net income related to financial liabilities — — — — — — — 2,205 Net unrealized investment gains (losses) on securities included in OCI (471 ) 128 (6,184 ) (6,527 ) — — (6,527 ) — Purchases — — — — — — — — Issuances — — — — — — — 3,940 Sales — — (187 ) (187 ) — — (187 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (121 ) (3,926 ) (15,466 ) (19,513 ) — — (19,513 ) (1,668 ) Ending balance, September 30, 2018 $ 49,329 $ 88,865 $ 123,284 $ 261,478 $ 6 $ — $ 261,484 $ 82,265 Beginning balance, January 1, 2018 $ 49,328 $ 72,979 $ 107,944 $ 230,251 $ 6 $ — $ 230,257 $ 80,733 Transfers into Level 3 (3) — 40,487 50,174 90,661 — — 90,661 — Transfers out of Level 3 (3) — (11,279 ) (5,200 ) (16,479 ) — — (16,479 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (246 ) — (246 ) 3 — (243 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — (1,308 ) Net unrealized investment gains (losses) on securities included in OCI 369 (1,459 ) (5,547 ) (6,637 ) — — (6,637 ) — Purchases — — — — — — — — Issuances — — — — — — — 7,379 Sales — — (187 ) (187 ) (3 ) — (190 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (368 ) (11,617 ) (23,900 ) (35,885 ) — — (35,885 ) (4,539 ) Ending balance, September 30, 2018 $ 49,329 $ 88,865 $ 123,284 $ 261,478 $ 6 $ — $ 261,484 $ 82,265 ________________ (1) Represents embedded derivatives, all related to FIA products, reported in Other policyholder funds in the Company’s Consolidated Balance Sheets. (2) Includes U.S. Government and federally sponsored agency obligations for mortgage-backed securities and other mortgage-backed securities. (3) Transfers into and out of Level 3 during the three and nine month periods ended September 30, 2018 were attributable to changes in the availability of observable market information for individual fixed maturity securities. The Company’s policy is to recognize transfers into and transfers out of the levels as having occurred at the end of the reporting period in which the transfers were determined. ($ in thousands) Financial Assets Financial Liabilities (1) Municipal Bonds Corporate Bonds Mortgage- Backed Securities (2) Total Fixed Maturity Securities Equity Securities Short-term Investments Total Beginning balance, July 1, 2017 $ 49,123 $ 77,052 $ 120,324 $ 246,499 $ 6 $ — $ 246,505 $ 67,995 Transfers into Level 3 (3) — 23,501 11,961 35,462 — — 35,462 — Transfers out of Level 3 (3) — 1 (881 ) (880 ) — — (880 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (1 ) (160 ) (161 ) — — (161 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — 2,587 Net unrealized investment gains (losses) on securities included in OCI 382 (192 ) (377 ) (187 ) — — (187 ) — Purchases — — — — — — — — Issuances — — — — — — — 3,752 Sales — (1,999 ) — (1,999 ) — — (1,999 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (293 ) (4,117 ) (9,249 ) (13,659 ) — — (13,659 ) (1,348 ) Ending balance, September 30, 2017 $ 49,212 $ 94,245 $ 121,618 $ 265,075 $ 6 $ — $ 265,081 $ 72,986 Beginning balance, January 1, 2017 $ 46,497 $ 60,191 $ 104,659 $ 211,347 $ 6 $ 751 $ 212,104 $ 59,393 Transfers into Level 3 (3) 5,214 55,420 36,482 97,116 — — 97,116 — Transfers out of Level 3 (3) (5,557 ) (11,962 ) (881 ) (18,400 ) — (751 ) (19,151 ) — Total gains or losses Net investment gains (losses) included in net income related to financial assets — (1 ) (1,874 ) (1,875 ) — — (1,875 ) — Net (gains) losses included in net income related to financial liabilities — — — — — — — 6,133 Net unrealized investment gains (losses) on securities included in OCI 3,540 263 1,945 5,748 — — 5,748 — Purchases — — — — — — — — Issuances — — — — — — — 10,538 Sales — (1,999 ) — (1,999 ) — — (1,999 ) — Settlements — — — — — — — — Paydowns, maturities and distributions (482 ) (7,667 ) (18,713 ) (26,862 ) — — (26,862 ) (3,078 ) Ending balance, September 30, 2017 $ 49,212 $ 94,245 $ 121,618 $ 265,075 $ 6 $ — $ 265,081 $ 72,986 ________________ (1) Represents embedded derivatives, all related to FIA products, reported in Other policyholder funds in the Company’s Consolidated Balance Sheets. (2) Includes U.S. Government and federally sponsored agency obligations for mortgage-backed securities and other mortgage-backed securities. (3) Transfers into and out of Level 3 during the three and nine month periods ended September 30, 2017 |
Summary of fair value assets and liabilities measured on nonrecurring basis | The Company has various other financial assets and financial liabilities used in the normal course of business that are not carried at fair value, but for which fair value disclosure is required. The following table presents the carrying value, fair value and fair value hierarchy of these financial assets and financial liabilities. ($ in thousands) Fair Value Measurements at Carrying Fair Reporting Date Using Amount Value Level 1 Level 2 Level 3 September 30, 2018 Financial Assets Investments Other investments $ 155,410 $ 160,121 $ — $ — $ 160,121 Financial Liabilities Investment contract and life policy reserves, fixed annuity contracts 4,545,232 4,445,442 — — 4,445,442 Investment contract and life policy reserves, account values on life contracts 85,698 91,254 — — 91,254 Other policyholder funds 640,187 640,187 — 576,021 64,166 Long-term debt 297,671 304,614 — 304,614 — December 31, 2017 Financial Assets Investments Other investments $ 154,898 $ 159,575 $ — $ — $ 159,575 Financial Liabilities Investment contract and life policy reserves, fixed annuity contracts 4,452,972 4,366,334 — — 4,366,334 Investment contract and life policy reserves, 82,911 88,620 — — 88,620 Other policyholder funds 643,528 643,528 — 575,622 67,906 Long-term debt 297,469 311,315 — 311,315 — |
Derivative Instruments (Tables)
Derivative Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value | The fair values of derivative instruments, including derivative instruments embedded in FIA and IUL contracts, are presented in the Consolidated Balance Sheets as follows: ($ in thousands) September 30, 2018 December 31, 2017 Assets Derivative instruments, included in Short-term and other investments $ 10,198 $ 15,550 Liabilities FIA - embedded derivatives, included in Other policyholder funds $ 82,265 $ 80,733 IUL - embedded derivatives, included in Investment contract and life policy reserves 722 594 |
Derivative Instruments, Gain (Loss) | The changes in fair value of derivatives included in the Consolidated Statements of Operations were as follows: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Change in fair value of derivatives: (1) Revenues Net investment gains (losses) $ 4,683 $ 2,943 $ 3,832 $ 7,109 Change in fair value of embedded derivatives: Revenues Net investment gains (losses) $ (2,479 ) $ (2,702 ) $ 1,090 $ (6,363 ) ________________ (1) |
Financing Receivable Credit Quality Indicators | The notional amount and fair value of call options by counterparty and each counterparty’s long-term credit ratings were as follows: ($ in thousands) September 30, 2018 December 31, 2017 Credit Rating Notional Fair Notional Fair Counterparty S&P Moody's Amount Value Amount Value Bank of America, N.A. A+ Aa3 $ 135,600 $ 6,144 $ 85,100 $ 6,320 Barclays Bank PLC A A2 26,200 586 48,900 1,828 Citigroup Inc. BBB+ — — — — Credit Suisse International A A1 16,100 307 21,100 1,444 Societe Generale A 92,000 3,161 91,700 5,958 Total $ 269,900 $ 10,198 $ 246,800 $ 15,550 |
Property and Casualty Unpaid _2
Property and Casualty Unpaid Claims and Claim Expenses (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Insurance Loss Reserves [Abstract] | |
Reconciliation of property and casualty unpaid claims and claim expenses | The end of the period gross reserve (before reinsurance) balances and the reinsurance recoverable balances are reflected on a gross basis in the Consolidated Balance Sheets. ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Property and Casualty Beginning gross reserves (1) $ 352,817 $ 329,831 $ 319,182 $ 307,757 Less: reinsurance recoverables 62,883 58,897 57,409 61,199 Net reserves, beginning of period (2) 289,934 270,934 261,773 246,558 Incurred claims and claim expenses: Claims occurring in the current period 140,035 115,393 408,028 386,945 Decrease in estimated reserves for claims occurring in prior periods (3) — (500 ) (300 ) (2,100 ) Total claims and claim expenses incurred (4) 140,035 114,893 407,728 384,845 Claims and claim expense payments for claims occurring during: Current period 106,187 97,188 233,638 245,213 Prior periods 28,997 28,054 141,078 125,605 Total claims and claim expense payments 135,184 125,242 374,716 370,818 Net reserves, end of period (2) 294,785 260,585 294,785 260,585 Plus: reinsurance recoverables 63,262 57,302 63,262 57,302 Ending gross reserves (1) $ 358,047 $ 317,887 $ 358,047 $ 317,887 ________________ (1) Unpaid claims and claim expenses as reported in the Consolidated Balance Sheets also include reserves for Life and Retirement of $26,589 thousand and $23,897 thousand as of September 30, 2018 and 2017 , respectively, in addition to Property and Casualty reserves. (2) Reserves net of anticipated reinsurance recoverables. (3) Shows the amounts by which the Company decreased its reserves in each of the periods indicated for claims occurring in previous periods to reflect subsequent information on such claims and changes in their projected final settlement costs. (4) Benefits, claims and settlement expenses as reported in the Consolidated Statements of Operations also include amounts for Life and Retirement of $21,811 thousand and $65,958 thousand for the three and nine month periods ended September 30, 2018 , respectively, in addition to Property and Casualty amounts. Benefits, claims and settlement expenses for Life and Retirement were $20,002 thousand and $60,025 thousand for the three and nine month periods ended September 30, 2017 , respectively. |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Disclosure [Abstract] | |
Summary of Indebtedness outstanding | Indebtedness outstanding was as follows: ($ in thousands) September 30, 2018 December 31, 2017 Short-term debt: Bank Credit Facility, expires June 27, 2023 $ — $ — Long-term debt: 4.50% Senior Notes, due December 1, 2025. Aggregate principal amount of $250,000 thousand less unaccrued discount of $503 and $547 thousand (4.5% imputed rate) and unamortized debt issuance costs of $1,826 thousand and $1,984 thousand 247,671 247,469 Federal Home Loan Bank borrowing 50,000 50,000 Total $ 297,671 $ 297,469 |
Reinsurance (Tables)
Reinsurance (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Insurance [Abstract] | |
Effects of reinsurance on premiums and benefits | The effects of reinsurance on premiums written and contract deposits; premiums and contract charges earned; and benefits, claims and settlement expenses were as follows: ($ in thousands) Gross Amount Ceded to Other Companies Assumed from Other Companies Net Amount Three months ended September 30, 2018 Premiums written and contract deposits (1) $ 342,268 $ 5,370 $ 1,199 $ 338,097 Premiums and contract charges earned 210,953 5,385 1,252 206,820 Benefits, claims and settlement expenses 163,912 3,207 1,141 161,846 Three months ended September 30, 2017 Premiums written and contract deposits (1) $ 322,428 $ 5,189 $ 1,116 $ 318,355 Premiums and contract charges earned 202,988 5,216 1,163 198,935 Benefits, claims and settlement expenses 135,508 1,831 1,218 134,895 Nine months ended September 30, 2018 Premiums written and contract deposits (1) $ 936,948 $ 16,367 $ 3,246 $ 923,827 Premiums and contract charges earned 628,582 16,418 3,264 615,428 Benefits, claims and settlement expenses 486,339 15,551 2,898 473,686 Nine months ended September 30, 2017 Premiums written and contract deposits (1) $ 940,063 $ 16,342 $ 2,980 $ 926,701 Premiums and contract charges earned 603,794 16,415 2,996 590,375 Benefits, claims and settlement expenses 450,997 8,899 2,772 444,870 ________________ (1) |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Reporting [Abstract] | |
Summarized financial information for these segments | Summarized financial information for these segments is as follows: ($ in thousands) Three Months Ended Nine Months Ended 2018 2017 2018 2017 Insurance premiums and contract charges earned Property and Casualty $ 168,653 $ 163,209 $ 501,444 $ 481,987 Retirement 8,031 7,393 23,924 20,753 Life 30,136 28,333 90,060 87,635 Total $ 206,820 $ 198,935 $ 615,428 $ 590,375 Net investment income Property and Casualty $ 12,361 $ 9,167 $ 32,177 $ 26,457 Retirement 67,750 64,340 199,706 192,921 Life 19,123 18,999 56,629 56,215 Corporate and Other 41 17 119 47 Intersegment eliminations (192 ) (203 ) (583 ) (615 ) Total $ 99,083 $ 92,320 $ 288,048 $ 275,025 Net income (loss) Property and Casualty $ (3,190 ) $ 13,407 $ (4,364 ) $ 2,186 Retirement 12,120 13,603 37,682 36,933 Life 5,331 4,788 14,997 14,283 Corporate and Other (1,733 ) (5,247 ) (9,715 ) (9,272 ) Total $ 12,528 $ 26,551 $ 38,600 $ 44,130 ($ in thousands) September 30, 2018 December 31, 2017 Assets Property and Casualty $ 1,241,538 $ 1,217,394 Retirement 8,143,384 8,063,912 Life 1,787,361 1,815,732 Corporate and Other 146,593 143,784 Intersegment eliminations (38,111 ) (42,482 ) Total $ 11,280,765 $ 11,198,340 |
Basis of Presentation - Investm
Basis of Presentation - Investment Contract and Life Policy Reserves (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Investment contract reserves | $ 4,545,232 | $ 4,452,972 |
Life policy reserves | 1,145,457 | 1,120,763 |
Total | $ 5,690,689 | $ 5,573,735 |
Basis of Presentation - Accumul
Basis of Presentation - Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 1,501,573 | |||
Other comprehensive income (loss) before reclassifications | $ (49,165) | $ 9,786 | (211,577) | $ 78,419 |
Amounts reclassified from accumulated other comprehensive income (loss) | (473) | 2,422 | 2,399 | 1,561 |
Cumulative effect of change in accounting principle | 0 | 0 | (15,041) | 0 |
Net current period other comprehensive income (loss) | (49,638) | 12,208 | (224,219) | 79,980 |
Ending balance | 1,304,256 | 1,390,441 | 1,304,256 | 1,390,441 |
Other income tax expense (benefit) | (1,304) | 126 | (840) | (638) |
Reclassification of unrealized gains on equity securities, net of tax | 0 | 0 | 15,041 | 0 |
Total | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 112,379 | 231,693 | 286,960 | 163,921 |
Cumulative effect of change in accounting principle | (15,041) | 0 | ||
Ending balance | 62,741 | 243,901 | 62,741 | 243,901 |
Net Unrealized Investment Gains and Losses on Fixed Maturity and Equity Securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 125,596 | 243,510 | 300,177 | 175,738 |
Other comprehensive income (loss) before reclassifications | (49,165) | 9,786 | (211,577) | 78,419 |
Amounts reclassified from accumulated other comprehensive income (loss) | (473) | 2,422 | 2,399 | 1,561 |
Cumulative effect of change in accounting principle | 0 | (15,041) | ||
Net current period other comprehensive income (loss) | (49,638) | 12,208 | (224,219) | 79,980 |
Ending balance | 75,958 | 255,718 | 75,958 | 255,718 |
Pretax reclassification amounts from accumulated other comprehensive income (loss) | (3,726) | 599 | (2,401) | (3,037) |
Benefit Plans | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | (13,217) | (11,817) | (13,217) | (11,817) |
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 |
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | 0 | 0 |
Cumulative effect of change in accounting principle | 0 | 0 | ||
Net current period other comprehensive income (loss) | 0 | 0 | 0 | 0 |
Ending balance | $ (13,217) | $ (11,817) | $ (13,217) | $ (11,817) |
Basis of Presentation - Narrati
Basis of Presentation - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Basis of Presentation [Line Items] | ||||
Cumulative effect of change in accounting principle | $ 0 | $ 0 | $ (15,041) | $ 0 |
Future lease commitments | 13,267 | 13,267 | ||
Retained earnings | ||||
Basis of Presentation [Line Items] | ||||
Cumulative effect of change in accounting principle | 15,041 | 0 | ||
Accumulated other comprehensive income (loss), net of tax: | ||||
Basis of Presentation [Line Items] | ||||
Cumulative effect of change in accounting principle | (15,041) | $ 0 | ||
Stranded Tax Amounts Reclassified | 47,900 | |||
Net Unrealized Investment Gains and Losses on Fixed Maturity and Equity Securities | ||||
Basis of Presentation [Line Items] | ||||
Cumulative effect of change in accounting principle | 0 | (15,041) | ||
Stranded Tax Amounts Reclassified | 50,034 | |||
Benefit Plans | ||||
Basis of Presentation [Line Items] | ||||
Cumulative effect of change in accounting principle | $ 0 | 0 | ||
Stranded Tax Amounts Reclassified | $ (2,134) |
Investments - Summary of Fair V
Investments - Summary of Fair Value and Amortized Costs (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | $ 7,419,491 | $ 7,302,950 |
Amortized Cost/Cost | 116,320 | |
Fair Value | 7,529,139 | 7,724,075 |
Federal National Mortgage Association Certificates and Obligations (FNMA) | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Fair Value | 408,130 | 361,955 |
Federal Home Loan Mortgage Corporation Certificates and Obligations (FHLMC) | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Fair Value | 408,858 | 400,001 |
Government National Mortgage Association Certificates and Obligations (GNMA) | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Fair Value | 96,018 | 104,168 |
Total Fixed Maturity Securities | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 7,419,491 | 7,302,950 |
Unrealized Investment Gains | 233,212 | 443,633 |
Unrealized Investment Losses | 123,564 | 22,508 |
Fair Value | 7,529,139 | 7,724,075 |
Mortgage-backed securities | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 758,301 | 669,297 |
Unrealized Investment Gains | 15,744 | 30,460 |
Unrealized Investment Losses | 23,209 | 3,032 |
Fair Value | 750,836 | 696,725 |
Other, including U.S. Treasury securities | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 802,508 | 714,613 |
Unrealized Investment Gains | 12,528 | 26,311 |
Unrealized Investment Losses | 32,436 | 5,516 |
Fair Value | 782,600 | 735,408 |
Municipal bonds | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 1,783,711 | 1,711,581 |
Unrealized Investment Gains | 119,671 | 184,107 |
Unrealized Investment Losses | 19,708 | 2,435 |
Fair Value | 1,883,674 | 1,893,253 |
Foreign government bonds | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 92,860 | 96,780 |
Unrealized Investment Gains | 2,787 | 5,958 |
Unrealized Investment Losses | 644 | 0 |
Fair Value | 95,003 | 102,738 |
Corporate bonds | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 2,290,452 | 2,409,426 |
Unrealized Investment Gains | 74,409 | 173,862 |
Unrealized Investment Losses | 29,365 | 4,334 |
Fair Value | 2,335,496 | 2,578,954 |
Other mortgage-backed securities | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 1,691,659 | 1,701,253 |
Unrealized Investment Gains | 8,073 | 22,935 |
Unrealized Investment Losses | 18,202 | 7,191 |
Fair Value | $ 1,681,530 | 1,716,997 |
Equity securities | ||
Unrealized gains and losses on fixed maturities and equity securities | ||
Amortized Cost/Cost | 116,320 | |
Unrealized Investment Gains | 19,425 | |
Unrealized Investment Losses | 279 | |
Fair Value | $ 135,466 |
Investments - Fair Value and Gr
Investments - Fair Value and Gross Unrealized Losses (Details) $ in Thousands | Sep. 30, 2018USD ($)security | Dec. 31, 2017USD ($)security |
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | $ 3,016,397 | $ 910,409 |
Fixed maturity securities, Fair Value, More than 12 Months | 682,467 | 448,829 |
Fixed maturity securities, Fair Value, Total | 3,698,864 | 1,359,238 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 77,130 | 8,743 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 46,434 | 14,044 |
Fixed maturity securities, Gross Unrealized Losses, Total | $ 123,564 | $ 22,787 |
Number of positions with a gross unrealized loss, 12 Months or Less | security | 1,237 | 354 |
Number of position with a gross unrealized loss, more than 12 months | security | 246 | 158 |
Number of position with a gross unrealized loss, Total | security | 1,483 | 512 |
Fair value as a percentage of total fixed maturities and equity securities fair value, 12 Months or Less | 39.40% | 11.60% |
Fair value as a percentage of total fixed maturities and equity securities fair value, more than 12 months | 8.90% | 5.70% |
Fair value as a percentage of total fixed maturities and equity securities fair value, Total | 48.30% | 17.30% |
Mortgage-backed securities | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | $ 330,285 | $ 134,032 |
Fixed maturity securities, Fair Value, More than 12 Months | 99,483 | 40,606 |
Fixed maturity securities, Fair Value, Total | 429,768 | 174,638 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 13,484 | 1,053 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 9,725 | 1,979 |
Fixed maturity securities, Gross Unrealized Losses, Total | 23,209 | 3,032 |
Other | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 450,713 | 168,634 |
Fixed maturity securities, Fair Value, More than 12 Months | 163,569 | 122,753 |
Fixed maturity securities, Fair Value, Total | 614,282 | 291,387 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 18,510 | 1,849 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 13,926 | 3,667 |
Fixed maturity securities, Gross Unrealized Losses, Total | 32,436 | 5,516 |
Municipal bonds | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 491,680 | 29,437 |
Fixed maturity securities, Fair Value, More than 12 Months | 75,678 | 79,140 |
Fixed maturity securities, Fair Value, Total | 567,358 | 108,577 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 13,484 | 100 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 6,224 | 2,335 |
Fixed maturity securities, Gross Unrealized Losses, Total | 19,708 | 2,435 |
Foreign government bonds | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 19,856 | 0 |
Fixed maturity securities, Fair Value, More than 12 Months | 0 | 0 |
Fixed maturity securities, Fair Value, Total | 19,856 | 0 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 644 | 0 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 0 | 0 |
Fixed maturity securities, Gross Unrealized Losses, Total | 644 | 0 |
Corporate bonds | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 821,190 | 115,113 |
Fixed maturity securities, Fair Value, More than 12 Months | 90,998 | 36,081 |
Fixed maturity securities, Fair Value, Total | 912,188 | 151,194 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 20,801 | 2,701 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 8,564 | 1,633 |
Fixed maturity securities, Gross Unrealized Losses, Total | 29,365 | 4,334 |
Other mortgage-backed securities | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 902,673 | 457,166 |
Fixed maturity securities, Fair Value, More than 12 Months | 252,739 | 168,972 |
Fixed maturity securities, Fair Value, Total | 1,155,412 | 626,138 |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 10,207 | 2,791 |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 7,995 | 4,400 |
Fixed maturity securities, Gross Unrealized Losses, Total | $ 18,202 | 7,191 |
Total Fixed Maturity Securities | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 904,382 | |
Fixed maturity securities, Fair Value, More than 12 Months | 447,552 | |
Fixed maturity securities, Fair Value, Total | 1,351,934 | |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 8,494 | |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 14,014 | |
Fixed maturity securities, Gross Unrealized Losses, Total | 22,508 | |
Equity securities | ||
Fixed maturity securities, Fair Value | ||
Fixed maturity securities, Fair Value, 12 Months or Less | 6,027 | |
Fixed maturity securities, Fair Value, More than 12 Months | 1,277 | |
Fixed maturity securities, Fair Value, Total | 7,304 | |
Fixed maturity securities, Gross Unrealized Losses, 12 Months or Less | 249 | |
Fixed maturity securities, Gross Unrealized Losses, More than 12 Months | 30 | |
Fixed maturity securities, Gross Unrealized Losses, Total | $ 279 |
Investments - Rollforward of OT
Investments - Rollforward of OTTI Losses (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Cumulative credit loss | ||
Beginning of period | $ 3,825 | $ 13,703 |
New credit losses | 0 | 0 |
Increases to previously recognized credit losses | 246 | 1,994 |
Losses related to securities sold or paid down during the period | (2,542) | (2) |
End of period | $ 1,529 | $ 15,695 |
Investments - Distribution of F
Investments - Distribution of Fixed Maturity Securities by Expected Maturity (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Percent of Total Fair Value | ||
Due in 1 year or less, Percent of Total Fair Value | 4.50% | 3.20% |
Due after 1 year through 5 years, Percent of Total Fair Value | 23.70% | 26.70% |
Due after 5 years through 10 years, Percent of Total Fair Value | 32.80% | 32.60% |
Due after 10 years through 20 years, Percent of Total Fair Value | 26.10% | 24.20% |
Due after 20 years, Percent of Total Fair Value | 12.90% | 13.30% |
Total, Percent of Total Fair Value | 100.00% | 100.00% |
Fair Value | ||
Due in 1 year or less, Fair Value | $ 342,221 | |
Due after 1 year through 5 years, Fair Value | 1,783,259 | |
Due after 5 years through 10 years, Fair Value | 2,469,126 | |
Due after 10 years through 20 years, Fair Value | 1,962,671 | |
Due after 20 years, Fair Value | 971,862 | |
Total, Fair Value | 7,529,139 | $ 7,724,075 |
Amortized Cost | ||
Due in 1 year or less, Amortized Cost | 339,321 | |
Due after 1 year through 5 years, Amortized Cost | 1,758,061 | |
Due after 5 years through 10 years, Amortized Cost | 2,464,959 | |
Due after 10 years through 20 years, Amortized Cost | 1,929,967 | |
Due after 20 years, Amortized Cost | 927,183 | |
Total, Amortized Cost | $ 7,419,491 | $ 7,302,950 |
Average option-adjusted duration, in years | 6 years | 5 years 10 months 24 days |
Investments - Summary of Procee
Investments - Summary of Proceeds and Gains (Losses) Realized on Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Debt Securities, Available-for-sale [Line Items] | ||||
Proceeds received, Fixed maturity securities | $ 170,223 | $ 85,841 | $ 360,246 | $ 315,531 |
Proceeds received, Equity securities | 2,710 | 3,514 | 8,493 | 20,510 |
Fixed maturity securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Gross gains realized | 3,980 | 2,293 | 8,002 | 8,862 |
Gross losses realized | (5,893) | (181) | (7,530) | (1,558) |
Equity securities | ||||
Debt Securities, Available-for-sale [Line Items] | ||||
Gross gains realized | 885 | 477 | 2,478 | 3,227 |
Gross losses realized | $ (321) | $ (293) | $ (502) | $ (721) |
Investments - Reconciliation of
Investments - Reconciliation of Net Unrealized Investment Gains (Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | $ 1,501,573 | |||
Change in net unrealized investment gains on securities | $ (49,638) | $ 12,208 | (209,178) | $ 79,980 |
Cumulative effect of change in accounting principle | 0 | 0 | (15,041) | 0 |
Ending balance | 1,304,256 | 1,390,441 | 1,304,256 | 1,390,441 |
Net Unrealized Investment Gains and Losses on Fixed Maturity and Equity Securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 125,596 | 243,510 | 300,177 | 175,738 |
Cumulative effect of change in accounting principle | 0 | (15,041) | ||
Ending balance | 75,958 | 255,718 | 75,958 | 255,718 |
Net Unrealized Investment Gains and Losses on Fixed Maturity and Equity Securities | Fixed maturity securities | ||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | ||||
Beginning balance | 144,998 | 281,465 | 286,176 | 202,941 |
Change in net unrealized investment gains on securities | (57,903) | 12,066 | (186,912) | 91,452 |
Reclassification of net investment (gains) losses to net income | (473) | 2,422 | 2,399 | 1,560 |
Ending balance | $ 86,622 | $ 295,953 | $ 86,622 | $ 295,953 |
Investments - Offsetting of Ass
Investments - Offsetting of Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Asset derivatives: | ||
Net Amounts of Assets/Liabilities Presented in the Consolidated Balance Sheets | $ 10,198 | $ 15,550 |
Free-standing derivatives | ||
Asset derivatives: | ||
Gross Amounts | 10,198 | 15,550 |
Gross Amounts Offset in the Consolidated Balance Sheets | 0 | 0 |
Net Amounts of Assets/Liabilities Presented in the Consolidated Balance Sheets | 10,198 | 15,550 |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Financial Instruments | 0 | 0 |
Gross Amounts Not Offset in the Consolidated Balance Sheets, Cash Collateral Received | 11,638 | 15,584 |
Net Amount | $ (1,440) | $ (34) |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investment Holdings [Line Items] | ||
Investment Grade Rate | 97.50% | |
Fair value of issued securities | $ 7,529,139 | $ 7,724,075 |
Federal Home Loan Bank Funding Agreements | 625,000 | 625,000 |
Federal Home Loans Bank Of Chicago | ||
Investment Holdings [Line Items] | ||
Fair value of issued securities | 685,886 | 686,790 |
Governmental Agencies as Required by Law in Various States | ||
Investment Holdings [Line Items] | ||
Fair value of issued securities | $ 17,676 | $ 17,985 |
Investments - Net Realized Gain
Investments - Net Realized Gain (Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Impairment write-downs | $ 0 | $ 0 | $ 0 | $ (1,777) |
Change in intent write-downs | (70) | (6,092) | (1,357) | (10,675) |
Net OTTI losses recognized in earnings | (70) | (6,092) | (1,357) | (12,452) |
Sales and other, net | (1,331) | 2,365 | 2,661 | 10,050 |
Change in fair value - equity securities | 2,000 | 0 | (4,342) | 0 |
Change in fair value and gains (losses) realized on settlements - derivative instruments | 2,204 | 241 | 4,922 | 746 |
Net investment gains (losses) | $ 2,803 | $ (3,486) | $ 1,884 | $ (1,656) |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Instruments Measured and Carried at Fair Value (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | $ (6,527) | $ (187) | $ (6,637) | $ 5,748 | ||||
Net unrealized investment gains (losses) included in other comprehensive income | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases | 0 | 0 | 0 | 0 | ||||
Purchases | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Issuances | 0 | 0 | 0 | 0 | ||||
Issuances | 3,940 | 3,752 | 7,379 | 10,538 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 261,484 | 265,081 | 261,484 | 265,081 | $ 271,651 | $ 230,257 | $ 246,505 | $ 212,104 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Liability Value | 82,265 | 72,986 | 82,265 | 72,986 | 77,788 | 80,733 | 67,995 | 59,393 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 17,030 | 35,462 | 90,661 | 97,116 | ||||
Transfers into Level 3 | 0 | 0 | 0 | 0 | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (161) | (243) | (1,875) | ||||
Net realized gains (losses) included in net income related to financial liabilities | 2,205 | 2,587 | (1,308) | 6,133 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 970 | 880 | 16,479 | 19,151 | ||||
Transfers out of Level 3 | 0 | 0 | 0 | 0 | ||||
Financial Liabilities | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | 187 | 1,999 | 190 | 1,999 | ||||
Sales | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | 0 | 0 | 0 | ||||
Settlements | 0 | 0 | 0 | 0 | ||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPaydownsAndMaturities | (1,668) | 1,348 | (4,539) | 3,078 | ||||
Paydowns, maturities and distributions | 19,513 | 13,659 | 35,885 | 26,862 | ||||
Short-term investments | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Issuances | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 751 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | 0 | 0 | 0 | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | 0 | 0 | 751 | ||||
Financial Liabilities | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | 0 | 0 | 0 | ||||
Paydowns, maturities and distributions | 0 | 0 | 0 | 0 | ||||
Municipal bonds | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | (471) | 382 | 369 | 3,540 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Issuances | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 49,329 | 49,212 | 49,329 | 49,212 | 49,921 | 49,328 | 49,123 | 46,497 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | 0 | 0 | 5,214 | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | 0 | 0 | 5,557 | ||||
Financial Liabilities | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | 0 | 0 | 0 | ||||
Paydowns, maturities and distributions | 121 | 293 | 368 | 482 | ||||
Corporate bonds | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | 128 | (192) | (1,459) | 263 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Issuances | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 88,865 | 94,245 | 88,865 | 94,245 | 92,663 | 72,979 | 77,052 | 60,191 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | 23,501 | 40,487 | 55,420 | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (1) | (246) | (1) | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | (1) | 11,279 | 11,962 | ||||
Financial Liabilities | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | 0 | 1,999 | 0 | 1,999 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | 0 | 0 | 0 | ||||
Paydowns, maturities and distributions | 3,926 | 4,117 | 11,617 | 7,667 | ||||
Equity securities | ||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Gain (Loss) Included in Other Comprehensive Income (Loss) | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Purchases | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Issuances | 0 | 0 | 0 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value | 6 | 6 | 6 | 6 | $ 6 | 6 | $ 6 | $ 6 |
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Transfers Into Level 3 | 0 | 0 | 0 | 0 | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 3 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Transfers out of Level 3 | 0 | 0 | 0 | 0 | ||||
Financial Liabilities | ||||||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Sales | 0 | 0 | 3 | 0 | ||||
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset, Settlements | 0 | 0 | 0 | 0 | ||||
Paydowns, maturities and distributions | 0 | $ 0 | 0 | $ 0 | ||||
Carrying Amount | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,759,668 | 7,759,668 | 7,950,184 | |||||
Financial Liabilities | ||||||||
Investment contract and life policy reserves, embedded derivatives | 722 | 722 | 594 | |||||
Other policyholder funds, embedded derivatives | 82,265 | 82,265 | 80,733 | |||||
Carrying Amount | Recurring | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,529,139 | 7,529,139 | 7,724,075 | |||||
Carrying Amount | Short-term investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 74,647 | 74,647 | 62,593 | |||||
Carrying Amount | Mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 750,836 | 750,836 | 696,725 | |||||
Carrying Amount | Other, including U.S. Treasury securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 782,600 | 782,600 | 735,408 | |||||
Carrying Amount | Municipal bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,883,674 | 1,883,674 | 1,893,253 | |||||
Carrying Amount | Foreign government bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 95,003 | 95,003 | 102,738 | |||||
Carrying Amount | Corporate bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 2,335,496 | 2,335,496 | 2,578,954 | |||||
Carrying Amount | Other mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,681,530 | 1,681,530 | 1,716,997 | |||||
Carrying Amount | Equity securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 133,184 | 133,184 | 135,466 | |||||
Carrying Amount | Other investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 22,698 | 22,698 | 28,050 | |||||
Fair Value | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,759,668 | 7,759,668 | 7,950,184 | |||||
Financial Liabilities | ||||||||
Investment contract and life policy reserves, embedded derivatives | 722 | 722 | 594 | |||||
Other policyholder funds, embedded derivatives | 82,265 | 82,265 | 80,733 | |||||
Fair Value | Recurring | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,529,139 | 7,529,139 | 7,724,075 | |||||
Fair Value | Short-term investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 74,647 | 74,647 | 62,593 | |||||
Fair Value | Mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 750,836 | 750,836 | 696,725 | |||||
Fair Value | Other, including U.S. Treasury securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 782,600 | 782,600 | 735,408 | |||||
Fair Value | Municipal bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,883,674 | 1,883,674 | 1,893,253 | |||||
Fair Value | Foreign government bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 95,003 | 95,003 | 102,738 | |||||
Fair Value | Corporate bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 2,335,496 | 2,335,496 | 2,578,954 | |||||
Fair Value | Other mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,681,530 | 1,681,530 | 1,716,997 | |||||
Fair Value | Equity securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 133,184 | 133,184 | 135,466 | |||||
Fair Value | Other investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 22,698 | 22,698 | 28,050 | |||||
Fair Value | Level 1 | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 179,383 | 179,383 | 172,539 | |||||
Financial Liabilities | ||||||||
Investment contract and life policy reserves, embedded derivatives | 0 | 0 | 0 | |||||
Other policyholder funds, embedded derivatives | 0 | 0 | 0 | |||||
Fair Value | Level 1 | Recurring | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 26,289 | 26,289 | 27,738 | |||||
Fair Value | Level 1 | Short-term investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 70,705 | 70,705 | 62,593 | |||||
Fair Value | Level 1 | Mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 1 | Other, including U.S. Treasury securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 13,101 | 13,101 | 13,393 | |||||
Fair Value | Level 1 | Municipal bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 1 | Foreign government bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 1 | Corporate bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 13,188 | 13,188 | 14,345 | |||||
Fair Value | Level 1 | Other mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 1 | Equity securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 82,389 | 82,389 | 82,208 | |||||
Fair Value | Level 1 | Other investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 2 | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,318,801 | 7,318,801 | 7,547,388 | |||||
Financial Liabilities | ||||||||
Investment contract and life policy reserves, embedded derivatives | 722 | 722 | 594 | |||||
Other policyholder funds, embedded derivatives | 0 | 0 | 0 | |||||
Fair Value | Level 2 | Recurring | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 7,241,372 | 7,241,372 | 7,466,086 | |||||
Fair Value | Level 2 | Short-term investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 3,942 | 3,942 | 0 | |||||
Fair Value | Level 2 | Mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 747,469 | 747,469 | 693,375 | |||||
Fair Value | Level 2 | Other, including U.S. Treasury securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 769,499 | 769,499 | 722,015 | |||||
Fair Value | Level 2 | Municipal bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,834,345 | 1,834,345 | 1,843,925 | |||||
Fair Value | Level 2 | Foreign government bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 95,003 | 95,003 | 102,738 | |||||
Fair Value | Level 2 | Corporate bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 2,233,443 | 2,233,443 | 2,491,630 | |||||
Fair Value | Level 2 | Other mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 1,561,613 | 1,561,613 | 1,612,403 | |||||
Fair Value | Level 2 | Equity securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 50,789 | 50,789 | 53,252 | |||||
Fair Value | Level 2 | Other investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 22,698 | 22,698 | 28,050 | |||||
Fair Value | Level 3 | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 261,484 | 261,484 | 230,257 | |||||
Financial Liabilities | ||||||||
Investment contract and life policy reserves, embedded derivatives | 0 | 0 | 0 | |||||
Other policyholder funds, embedded derivatives | 82,265 | 82,265 | 80,733 | |||||
Fair Value | Level 3 | Recurring | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 261,478 | 261,478 | 230,251 | |||||
Fair Value | Level 3 | Short-term investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 3 | Mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 3,367 | 3,367 | 3,350 | |||||
Fair Value | Level 3 | Other, including U.S. Treasury securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 3 | Municipal bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 49,329 | 49,329 | 49,328 | |||||
Fair Value | Level 3 | Foreign government bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 0 | 0 | 0 | |||||
Fair Value | Level 3 | Corporate bonds | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 88,865 | 88,865 | 72,979 | |||||
Fair Value | Level 3 | Other mortgage-backed securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 119,917 | 119,917 | 104,594 | |||||
Fair Value | Level 3 | Equity securities | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | 6 | 6 | 6 | |||||
Fair Value | Level 3 | Other investments | ||||||||
U.S. Government and federally sponsored agency obligations: | ||||||||
Investments | $ 0 | $ 0 | $ 0 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Rollforward of Instruments Measured on Recurring Basis (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Financial Assets | ||||
Beginning balance | $ 271,651 | $ 246,505 | $ 230,257 | $ 212,104 |
Transfers into Level 3 | 17,030 | 35,462 | 90,661 | 97,116 |
Transfers out of Level 3 | (970) | (880) | (16,479) | (19,151) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (161) | (243) | (1,875) |
Net unrealized investment gains (losses) included in other comprehensive income | (6,527) | (187) | (6,637) | 5,748 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | (187) | (1,999) | (190) | (1,999) |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | (19,513) | (13,659) | (35,885) | (26,862) |
Ending balance | 261,484 | 265,081 | 261,484 | 265,081 |
Financial Liabilities | ||||
Beginning balance | 77,788 | 67,995 | 80,733 | 59,393 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Total gains or losses | ||||
Net realized gains (losses) included in net income related to financial liabilities | 2,205 | 2,587 | (1,308) | 6,133 |
Net unrealized investment gains (losses) included in other comprehensive income | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 3,940 | 3,752 | 7,379 | 10,538 |
Sales | 0 | 0 | 0 | 0 |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | 1,668 | (1,348) | 4,539 | (3,078) |
Ending balance | 82,265 | 72,986 | 82,265 | 72,986 |
Short-term Investments | ||||
Financial Assets | ||||
Beginning balance | 0 | 0 | 0 | 751 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | (751) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 0 | 0 |
Net unrealized investment gains (losses) included in other comprehensive income | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | 0 | 0 | 0 | 0 |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | 0 | 0 | 0 | 0 |
Ending balance | 0 | 0 | 0 | 0 |
Total Fixed Maturity Securities | ||||
Financial Assets | ||||
Beginning balance | 271,645 | 246,499 | 230,251 | 211,347 |
Transfers into Level 3 | 17,030 | 35,462 | 90,661 | 97,116 |
Transfers out of Level 3 | (970) | (880) | (16,479) | (18,400) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (161) | (246) | (1,875) |
Net unrealized investment gains (losses) included in other comprehensive income | (6,527) | (187) | (6,637) | 5,748 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | (187) | (1,999) | (187) | (1,999) |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | (19,513) | (13,659) | (35,885) | (26,862) |
Ending balance | 261,478 | 265,075 | 261,478 | 265,075 |
Municipal bonds | ||||
Financial Assets | ||||
Beginning balance | 49,921 | 49,123 | 49,328 | 46,497 |
Transfers into Level 3 | 0 | 0 | 0 | 5,214 |
Transfers out of Level 3 | 0 | 0 | 0 | (5,557) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 0 | 0 |
Net unrealized investment gains (losses) included in other comprehensive income | (471) | 382 | 369 | 3,540 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | 0 | 0 | 0 | 0 |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | (121) | (293) | (368) | (482) |
Ending balance | 49,329 | 49,212 | 49,329 | 49,212 |
Corporate bonds | ||||
Financial Assets | ||||
Beginning balance | 92,663 | 77,052 | 72,979 | 60,191 |
Transfers into Level 3 | 0 | 23,501 | 40,487 | 55,420 |
Transfers out of Level 3 | 0 | 1 | (11,279) | (11,962) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (1) | (246) | (1) |
Net unrealized investment gains (losses) included in other comprehensive income | 128 | (192) | (1,459) | 263 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | 0 | (1,999) | 0 | (1,999) |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | (3,926) | (4,117) | (11,617) | (7,667) |
Ending balance | 88,865 | 94,245 | 88,865 | 94,245 |
Mortgage-Backed Securities | ||||
Financial Assets | ||||
Beginning balance | 129,061 | 120,324 | 107,944 | 104,659 |
Transfers into Level 3 | 17,030 | 11,961 | 50,174 | 36,482 |
Transfers out of Level 3 | (970) | (881) | (5,200) | (881) |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | (160) | 0 | (1,874) |
Net unrealized investment gains (losses) included in other comprehensive income | (6,184) | (377) | (5,547) | 1,945 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | (187) | 0 | (187) | 0 |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | (15,466) | (9,249) | (23,900) | (18,713) |
Ending balance | 123,284 | 121,618 | 123,284 | 121,618 |
Equity securities | ||||
Financial Assets | ||||
Beginning balance | 6 | 6 | 6 | 6 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Total gains or losses | ||||
Net realized investment gains (losses) included in net income related to financial assets | 0 | 0 | 3 | 0 |
Net unrealized investment gains (losses) included in other comprehensive income | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 0 | 0 |
Issuances | 0 | 0 | 0 | 0 |
Sales | 0 | 0 | (3) | 0 |
Settlements | 0 | 0 | 0 | 0 |
Paydowns, maturities and distributions | 0 | 0 | 0 | 0 |
Ending balance | $ 6 | $ 6 | $ 6 | $ 6 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Financial Instrument Not Carried at Fair Value (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Level 1 | ||
Investments | ||
Other investments | $ 0 | $ 0 |
Financial Liabilities | ||
Investment contract and life policy reserves, fixed annuity contracts | 0 | 0 |
Investment contract and life policy reserves, account values on life contracts | 0 | 0 |
Other policyholder funds | 0 | 0 |
Long-term debt | 0 | 0 |
Level 2 | ||
Investments | ||
Other investments | 0 | 0 |
Financial Liabilities | ||
Investment contract and life policy reserves, fixed annuity contracts | 0 | 0 |
Investment contract and life policy reserves, account values on life contracts | 0 | 0 |
Other policyholder funds | 576,021 | 575,622 |
Long-term debt | 304,614 | 311,315 |
Level 3 | ||
Investments | ||
Other investments | 160,121 | 159,575 |
Financial Liabilities | ||
Investment contract and life policy reserves, fixed annuity contracts | 4,445,442 | 4,366,334 |
Investment contract and life policy reserves, account values on life contracts | 91,254 | 88,620 |
Other policyholder funds | 64,166 | 67,906 |
Long-term debt | 0 | 0 |
Carrying Amount | ||
Investments | ||
Other investments | 155,410 | 154,898 |
Financial Liabilities | ||
Investment contract and life policy reserves, fixed annuity contracts | 4,545,232 | 4,452,972 |
Investment contract and life policy reserves, account values on life contracts | 85,698 | 82,911 |
Other policyholder funds | 640,187 | 643,528 |
Long-term debt | 297,671 | 297,469 |
Fair Value | ||
Investments | ||
Other investments | 160,121 | 159,575 |
Financial Liabilities | ||
Investment contract and life policy reserves, fixed annuity contracts | 4,445,442 | 4,366,334 |
Investment contract and life policy reserves, account values on life contracts | 91,254 | 88,620 |
Other policyholder funds | 640,187 | 643,528 |
Long-term debt | $ 304,614 | $ 311,315 |
Fair Value of Financial Instr_6
Fair Value of Financial Instruments - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Fair Value of Financial Instruments (Textual) [Abstract] | ||||
Net realized investment gains (losses) included in net income related to financial assets | $ 0 | $ 161 | $ 243 | $ 1,875 |
Level 3 | ||||
Fair Value of Financial Instruments (Textual) [Abstract] | ||||
Percentage of invested assets in total investment portfolio Level 3 recurring | 3.20% | 3.20% | ||
Net realized investment losses | $ (2,205) | $ (2,587) | $ (1,308) | $ (6,133) |
Derivative Instruments - Fair V
Derivative Instruments - Fair Value of Derivatives in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Assets | ||
Derivative instruments, included in Short-term and other investments | $ 10,198 | $ 15,550 |
Short-term and other investments | ||
Assets | ||
Derivative instruments, included in Short-term and other investments | 10,198 | 15,550 |
Other policyholder funds | ||
Liabilities | ||
FIA - embedded derivatives, included in Other policyholder funds | 82,265 | 80,733 |
Investment contract and life policy reserves | ||
Liabilities | ||
IUL - embedded derivatives, included in Investment contract and life policy reserves | $ 722 | $ 594 |
Derivative Instruments - Fair_2
Derivative Instruments - Fair Value of Derivatives Included in Consolidated Statements of Operations (Details) - Revenues - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Change in fair value of derivatives: | ||||
Net investment gains (losses) | $ 4,683 | $ 2,943 | $ 3,832 | $ 7,109 |
Change in fair value of embedded derivatives: | ||||
Net investment gains (losses) | $ (2,479) | $ (2,702) | $ 1,090 | $ (6,363) |
Derivative Instruments - Notion
Derivative Instruments - Notional and Fair Value Amounts of Derivative Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Derivative [Line Items] | ||
Notional Amount | $ 269,900 | $ 246,800 |
Fair Value | 10,198 | 15,550 |
Bank of America, N.A. | ||
Derivative [Line Items] | ||
Notional Amount | 135,600 | 85,100 |
Fair Value | 6,144 | 6,320 |
Barclays Bank PLC | ||
Derivative [Line Items] | ||
Notional Amount | 26,200 | 48,900 |
Fair Value | 586 | 1,828 |
Citigroup Inc. | ||
Derivative [Line Items] | ||
Notional Amount | 0 | 0 |
Fair Value | 0 | 0 |
Credit Suisse International | ||
Derivative [Line Items] | ||
Notional Amount | 16,100 | 21,100 |
Fair Value | 307 | 1,444 |
Societe Generale | ||
Derivative [Line Items] | ||
Notional Amount | 92,000 | 91,700 |
Fair Value | $ 3,161 | $ 5,958 |
Derivative Instruments - Narrat
Derivative Instruments - Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Derivatives, Fair Value [Line Items] | ||
Expected contract term | 10 years | |
Maximum exposure | $ 250,000 | |
Other liabilities | ||
Derivatives, Fair Value [Line Items] | ||
Fair value of collateral | $ 11,638,000 | $ 15,584,000 |
Property and Casualty Unpaid _3
Property and Casualty Unpaid Claims and Claim Expenses - Summary of Reinsurance Reserve Balances (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Reporting Information [Line Items] | ||||
Beginning Gross reserves | $ 347,749 | |||
Claims and claim expense payments for claims occurring during: | ||||
Ending Gross reserves | $ 384,636 | 384,636 | ||
Benefits, claims and settlement expenses | 161,846 | $ 134,895 | 473,686 | $ 444,870 |
Property and Casualty | ||||
Segment Reporting Information [Line Items] | ||||
Beginning Gross reserves | 352,817 | 329,831 | 319,182 | 307,757 |
Less: reinsurance recoverables | 62,883 | 58,897 | 57,409 | 61,199 |
Net reserves, beginning of year | 289,934 | 270,934 | 261,773 | 246,558 |
Incurred claims and claim expenses: | ||||
Claims occurring in the current period | 140,035 | 115,393 | 408,028 | 386,945 |
Decrease in estimated reserves for claims occurring in prior years | 0 | (500) | (300) | (2,100) |
Total claims and claim expenses incurred | 140,035 | 114,893 | 407,728 | 384,845 |
Claims and claim expense payments for claims occurring during: | ||||
Current period | 106,187 | 97,188 | 233,638 | 245,213 |
Prior periods | 28,997 | 28,054 | 141,078 | 125,605 |
Total claims and claim expense payments | 135,184 | 125,242 | 374,716 | 370,818 |
Net reserves, end of year | 294,785 | 260,585 | 294,785 | 260,585 |
Plus: reinsurance recoverables | 63,262 | 57,302 | 63,262 | 57,302 |
Ending Gross reserves | 358,047 | 317,887 | 358,047 | 317,887 |
Life and Annuity segments | ||||
Claims and claim expense payments for claims occurring during: | ||||
Net reserves, end of year | 26,589 | 23,897 | 26,589 | 23,897 |
Benefits, claims and settlement expenses | $ 21,811 | $ 20,002 | $ 65,958 | $ 60,025 |
Property and Casualty Unpaid _4
Property and Casualty Unpaid Claims and Claim Expenses - Narrative (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | |
Insurance Loss Reserves [Abstract] | ||
Favorable development of total reserves for property and casualty claims occurring in prior years | $ 300 | $ 2,100 |
Debt - Summary of Indebtedness
Debt - Summary of Indebtedness (Details) - USD ($) | Sep. 30, 2018 | Dec. 31, 2017 |
Short-term debt: | ||
Bank Credit Facility, expires June 27, 2023 | $ 0 | $ 0 |
Long-term debt: | ||
Long-term debt | 297,671,000 | 297,469,000 |
Debt and Capital Lease Obligations | 297,671,000 | 297,469,000 |
Senior Notes 4.50% [Member] | ||
Long-term debt: | ||
Long-term debt | 247,671,000 | 247,469,000 |
Unamortized discount | $ 503,000 | 547,000 |
Stated rate | 4.50% | |
Face amount | $ 250,000,000 | |
Unamortized debt issuance costs | 1,826,000 | 1,984,000 |
Federal Home Loan Bank Advances [Member] | ||
Long-term debt: | ||
Long-term debt | $ 50,000,000 | $ 50,000,000 |
Debt - Narrative (Details)
Debt - Narrative (Details) - USD ($) | 9 Months Ended | |
Sep. 30, 2018 | Jun. 27, 2018 | |
Senior Notes 4.50% [Member] | ||
Debt Instrument [Line Items] | ||
Stated rate | 4.50% | |
Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Borrowing capacity | $ 150,000,000 | |
Commitment fee percent | 0.15% | |
Eurodollar [Member] | Line of Credit [Member] | ||
Debt Instrument [Line Items] | ||
Spread on rate | 1.15% |
Reinsurance - Summary of Reinsu
Reinsurance - Summary of Reinsurance Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Gross Amount | ||||
Premiums written and contract deposits, Gross Amount | $ 342,268 | $ 322,428 | $ 936,948 | $ 940,063 |
Premiums and contract charges earned, Gross Amount | 210,953 | 202,988 | 628,582 | 603,794 |
Benefits, claims and settlement expenses, Gross Amount | 163,912 | 135,508 | 486,339 | 450,997 |
Ceded to Other Companies | ||||
Premiums written and contract deposits, Ceded to Other Companies | 5,370 | 5,189 | 16,367 | 16,342 |
Premiums and contract charges earned, Ceded to Other Companies | 5,385 | 5,216 | 16,418 | 16,415 |
Benefits, claims and settlement expenses, Ceded to Other Companies | 3,207 | 1,831 | 15,551 | 8,899 |
Assumed from Other Companies | ||||
Premiums written and contract deposits, Assumed from Other Companies | 1,199 | 1,116 | 3,246 | 2,980 |
Premiums and contract charges earned, Assumed from Other Companies | 1,252 | 1,163 | 3,264 | 2,996 |
Benefits, claims and settlement expenses, Assumed from Other Companies | 1,141 | 1,218 | 2,898 | 2,772 |
Net Amount | ||||
Premiums written and contract deposits, Net Amount | 338,097 | 318,355 | 923,827 | 926,701 |
Premiums and contract charges earned, Net Amount | 206,820 | 198,935 | 615,428 | 590,375 |
Benefits, claims and settlement expenses, Net Amount | $ 161,846 | $ 134,895 | $ 473,686 | $ 444,870 |
Commitments - Narrative (Detail
Commitments - Narrative (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Commitments and Contingencies Disclosure [Abstract] | ||
Unfunded commitments to purchase investments | $ 124,577 | $ 106,381 |
Segment Information - Summary o
Segment Information - Summary of Segment Activity (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)segment | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Segment Reporting Information [Line Items] | |||||
Reportable segments | segment | 4 | ||||
Operating segments | segment | 3 | ||||
Summarized financial information for these segments | |||||
Insurance premiums and contract charges earned | $ 206,820 | $ 198,935 | $ 615,428 | $ 590,375 | |
Net investment income | 99,083 | 92,320 | 288,048 | 275,025 | |
Net income (loss) | 12,528 | 26,551 | 38,600 | 44,130 | |
Assets | 11,280,765 | 11,280,765 | $ 11,198,340 | ||
Intersegment eliminations | |||||
Summarized financial information for these segments | |||||
Net investment income | (192) | (203) | (583) | (615) | |
Assets | (38,111) | (38,111) | (42,482) | ||
Property and Casualty | |||||
Summarized financial information for these segments | |||||
Insurance premiums and contract charges earned | 168,653 | 163,209 | 501,444 | 481,987 | |
Property and Casualty | Operating segments | |||||
Summarized financial information for these segments | |||||
Net investment income | 12,361 | 9,167 | 32,177 | 26,457 | |
Net income (loss) | (3,190) | 13,407 | (4,364) | 2,186 | |
Assets | 1,241,538 | 1,241,538 | 1,217,394 | ||
Retirement | |||||
Summarized financial information for these segments | |||||
Insurance premiums and contract charges earned | 8,031 | 7,393 | 23,924 | 20,753 | |
Retirement | Operating segments | |||||
Summarized financial information for these segments | |||||
Net investment income | 67,750 | 64,340 | 199,706 | 192,921 | |
Net income (loss) | 12,120 | 13,603 | 37,682 | 36,933 | |
Assets | 8,143,384 | 8,143,384 | 8,063,912 | ||
Life | |||||
Summarized financial information for these segments | |||||
Insurance premiums and contract charges earned | 30,136 | 28,333 | 90,060 | 87,635 | |
Life | Operating segments | |||||
Summarized financial information for these segments | |||||
Net investment income | 19,123 | 18,999 | 56,629 | 56,215 | |
Net income (loss) | 5,331 | 4,788 | 14,997 | 14,283 | |
Assets | 1,787,361 | 1,787,361 | 1,815,732 | ||
Corporate and Other | |||||
Summarized financial information for these segments | |||||
Net investment income | 41 | 17 | 119 | 47 | |
Net income (loss) | (1,733) | $ (5,247) | (9,715) | $ (9,272) | |
Assets | $ 146,593 | $ 146,593 | $ 143,784 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) | 9 Months Ended |
Sep. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
TCJA effect on tax rate | 8.80% |
Proposed Acquisition of Benef_2
Proposed Acquisition of Benefit Consultants Group, Inc. (BCG) - Narrative (Details) $ in Millions | Oct. 30, 2018USD ($) |
Benefit Consultants Group Inc. | Subsequent Event | |
Business Acquisition [Line Items] | |
Transaction value | $ 25 |