Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | |
Sep. 30, 2014 | Oct. 31, 2014 | |
Document and Entity Information [Abstract] | ' | ' |
Entity Registrant Name | 'MGIC INVESTMENT CORP | ' |
Entity Central Index Key | '0000876437 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Well-known Seasoned Issuer | 'Yes | ' |
Entity Voluntary Filers | 'No | ' |
Entity Current Reporting Status | 'Yes | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 338,559,545 |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q3 | ' |
Document Type | '10-Q | ' |
Amendment Flag | 'false | ' |
Document Period End Date | 30-Sep-14 | ' |
CONSOLIDATED_BALANCE_SHEETS_Un
CONSOLIDATED BALANCE SHEETS (Unaudited) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Securities, available-for-sale, at fair value: | ' | ' |
Fixed maturities (amortized cost, 2014 - $4,644,561; 2013 - $4,948,543) | $4,626,979 | $4,863,925 |
Equity securities | 3,022 | 2,894 |
Total investment portfolio | 4,630,001 | 4,866,819 |
Cash and cash equivalents | 243,922 | 332,692 |
Restricted cash and cash equivalents (note 1) | 17,207 | 17,440 |
Accrued investment income | 30,483 | 31,660 |
Prepaid reinsurance premiums (note 4) | 44,230 | 36,243 |
Reinsurance recoverable on loss reserves (note 4) | 57,898 | 64,085 |
Reinsurance recoverable on paid losses (note 4) | 6,450 | 10,425 |
Premium receivable | 60,330 | 62,301 |
Home office and equipment, net | 28,583 | 26,185 |
Deferred insurance policy acquisition costs | 11,650 | 9,721 |
Profit commission receivable | 68,952 | 2,368 |
Other assets | 139,672 | 141,451 |
Total assets | 5,339,378 | 5,601,390 |
Liabilities: | ' | ' |
Loss reserves (note 12) | 2,527,582 | 3,061,401 |
Premium deficiency reserve (note 13) | 28,711 | 48,461 |
Unearned premiums | 185,992 | 154,479 |
Senior notes (note 3) | 61,906 | 82,773 |
Convertible senior notes (note 3) | 845,000 | 845,000 |
Convertible junior debentures (note 3) | 389,522 | 389,522 |
Other liabilities | 316,157 | 275,216 |
Total liabilities | 4,354,870 | 4,856,852 |
Contingencies (note 5) | ' | ' |
Shareholders' equity (note 14): | ' | ' |
Common stock (one dollar par value, shares authorized 1,000,000; shares issued 2014 and 2013 - 340,047; shares outstanding 2014 - 338,560; 2013 - 337,758) | 340,047 | 340,047 |
Paid-in capital | 1,661,061 | 1,661,269 |
Treasury stock (shares at cost 2014 - 1,487; 2013 - 2,289) | -32,937 | -64,435 |
Accumulated other comprehensive loss, net of tax (note 9) | -56,776 | -117,726 |
Accumulated deficit | -926,887 | -1,074,617 |
Total shareholders' equity | 984,508 | 744,538 |
Total liabilities and shareholders' equity | $5,339,378 | $5,601,390 |
CONSOLIDATED_BALANCE_SHEETS_Un1
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 |
In Thousands, except Per Share data, unless otherwise specified | ||
Securities, available-for-sale, at fair value: | ' | ' |
Fixed maturities, amortized cost | $4,644,561 | $4,948,543 |
Shareholders' equity (note 14): | ' | ' |
Common stock, par value (in dollars per share) | $1 | $1 |
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 |
Common stock, shares issued (in shares) | 340,047 | 340,047 |
Common stock, shares outstanding (in shares) | 338,560 | 337,758 |
Treasury stock, shares at cost (in shares) | 1,487 | 2,289 |
CONSOLIDATED_STATEMENTS_OF_OPE
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Premiums written: | ' | ' | ' | ' |
Direct | $255,041 | $247,254 | $740,479 | $749,282 |
Assumed | 400 | 509 | 1,281 | 1,591 |
Ceded (note 4) | -32,536 | -13,485 | -87,450 | -31,473 |
Net premiums written | 222,905 | 234,278 | 654,310 | 719,400 |
Increase in unearned premiums, net | -13,870 | -2,421 | -23,528 | -2,707 |
Net premiums earned | 209,035 | 231,857 | 630,782 | 716,693 |
Investment income, net of expenses | 22,355 | 20,250 | 63,691 | 59,461 |
Realized investment gains, net | 632 | 189 | 923 | 3,933 |
Total other-than-temporary impairment losses | 0 | -328 | 0 | -328 |
Portion of losses recognized in other comprehensive income, before taxes | 0 | 0 | 0 | 0 |
Net impairment losses recognized in earnings | 0 | -328 | 0 | -328 |
Other revenue | 3,093 | 2,481 | 6,037 | 7,735 |
Total revenues | 235,115 | 254,449 | 701,433 | 787,494 |
Losses and expenses: | ' | ' | ' | ' |
Losses incurred, net (note 12) | 115,254 | 180,189 | 379,003 | 642,671 |
Change in premium deficiency reserve (note 13) | -6,744 | -3,813 | -19,750 | -16,746 |
Amortization of deferred policy acquisition costs | 2,096 | 2,209 | 5,191 | 5,861 |
Other underwriting and operating expenses, net | 34,882 | 45,761 | 105,101 | 139,683 |
Interest expense (note 3) | 17,361 | 17,653 | 52,274 | 62,001 |
Total losses and expenses | 162,849 | 241,999 | 521,819 | 833,470 |
Income (loss) before tax | 72,266 | 12,450 | 179,614 | -45,976 |
Provision for income taxes (note 11) | 249 | 336 | 2,093 | 2,465 |
Net income (loss) | $72,017 | $12,114 | $177,521 | ($48,441) |
Income (loss) per share (note 6): | ' | ' | ' | ' |
Basic (in dollars per share) | $0.21 | $0.04 | $0.52 | ($0.16) |
Diluted (in dollars per share) | $0.18 | $0.04 | $0.45 | ($0.16) |
Weighted average common shares outstanding - basic (note 6) (in shares) | 338,626 | 337,868 | 338,488 | 302,996 |
Weighted average common shares outstanding - diluted (note 6) (in shares) | 413,576 | 339,426 | 413,473 | 302,996 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract] | ' | ' | ' | ' |
Net income (loss) | $72,017 | $12,114 | $177,521 | ($48,441) |
Other comprehensive income (loss), net of tax (note 9): | ' | ' | ' | ' |
Change in unrealized investment gains and losses (note 7) | -17,301 | 7,277 | 66,798 | -100,796 |
Benefit plan adjustments | -1,732 | 0 | -5,198 | 0 |
Foreign currency translation adjustment | -2,490 | 1,885 | -650 | -10,311 |
Other comprehensive income (loss), net of tax | -21,523 | 9,162 | 60,950 | -111,107 |
Comprehensive income (loss) | $50,494 | $21,276 | $238,471 | ($159,548) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (USD $) | Common stock [Member] | Paid-in capital [Member] | Treasury stock [Member] | Accumulated other comprehensive income (loss) [Member] | Accumulated deficit [Member] | Total |
In Thousands | ||||||
Balance at Dec. 31, 2012 | $205,047 | $1,135,296 | ($104,959) | ($48,163) | ($990,281) | ' |
Net income (loss) | ' | ' | ' | ' | -48,441 | -48,441 |
Change in unrealized investment gains and losses, net (note 7) | 0 | 0 | 0 | -100,796 | 0 | -100,796 |
Common stock issuance (note 14) | 135,000 | 528,335 | 0 | 0 | 0 | ' |
Reissuance of treasury stock, net | 0 | -7,892 | 40,524 | 0 | -34,488 | ' |
Equity compensation | 0 | 4,175 | 0 | 0 | 0 | ' |
Benefit plan adjustments | ' | ' | ' | ' | ' | 0 |
Unrealized foreign currency translation adjustment | 0 | 0 | 0 | -10,311 | 0 | -10,311 |
Balance at Sep. 30, 2013 | 340,047 | 1,659,914 | -64,435 | -159,270 | -1,073,210 | ' |
Balance at Dec. 31, 2013 | 340,047 | 1,661,269 | -64,435 | -117,726 | -1,074,617 | 744,538 |
Net income (loss) | ' | ' | ' | ' | 177,521 | 177,521 |
Change in unrealized investment gains and losses, net (note 7) | 0 | 0 | 0 | 66,798 | 0 | 66,798 |
Reissuance of treasury stock, net | 0 | -6,680 | 31,498 | 0 | -29,791 | ' |
Equity compensation | 0 | 6,472 | 0 | 0 | 0 | ' |
Benefit plan adjustments | 0 | 0 | 0 | -5,198 | 0 | -5,198 |
Unrealized foreign currency translation adjustment | 0 | 0 | 0 | -650 | 0 | -650 |
Balance at Sep. 30, 2014 | $340,047 | $1,661,061 | ($32,937) | ($56,776) | ($926,887) | $984,508 |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 |
Cash flows from operating activities: | ' | ' |
Net income (loss) | $177,521 | ($48,441) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | ' | ' |
Depreciation and other amortization | 37,859 | 53,599 |
Deferred tax provision (benefit) | 336 | -11 |
Realized investment gains, excluding impairment losses | -923 | -3,933 |
Net investment impairment losses | 0 | 328 |
Loss on repurchases of senior notes | 837 | 0 |
Other | 29,132 | -3,235 |
Change in certain assets and liabilities: | ' | ' |
Accrued investment income | 1,177 | -7,007 |
Prepaid reinsurance premium | -7,987 | -7,974 |
Reinsurance recoverable on loss reserves | 6,187 | 34,227 |
Reinsurance recoverable on paid losses | 3,975 | 1,228 |
Premium receivable | 1,971 | 2,566 |
Deferred insurance policy acquisition costs | -1,929 | -1,273 |
Profit commission receivable | -66,584 | -2,938 |
Loss reserves | -533,819 | -703,849 |
Premium deficiency reserve | -19,750 | -16,746 |
Unearned premiums | 31,513 | 10,529 |
Income taxes payable (current) | -1,180 | 314 |
Net cash used in operating activities | -341,664 | -692,616 |
Cash flows from investing activities: | ' | ' |
Purchase of fixed maturities | -1,549,883 | -2,669,778 |
Purchase of equity securities | -59 | -69 |
Proceeds from sale of fixed maturities | 902,660 | 602,062 |
Proceeds from maturity of fixed maturities | 914,465 | 1,120,152 |
Net increase in payable for securities | 7,245 | 317 |
Net change in restricted cash | 233 | -60,348 |
Net cash provided by (used in) investing activities | 274,661 | -1,007,664 |
Cash flows from financing activities: | ' | ' |
Net proceeds from convertible senior notes | 0 | 484,625 |
Common stock shares issued | 0 | 663,335 |
Repurchases of long-term debt | -21,767 | -17,235 |
Net cash (used in) provided by financing activities | -21,767 | 1,130,725 |
Net decrease in cash and cash equivalents | -88,770 | -569,555 |
Cash and cash equivalents at beginning of period | 332,692 | 1,027,625 |
Cash and cash equivalents at end of period | $243,922 | $458,070 |
Nature_of_Business_and_Basis_o
Nature of Business and Basis of Presentation | 9 Months Ended | ||
Sep. 30, 2014 | |||
Nature of Business and Basis of Presentation [Abstract] | ' | ||
Nature of Business and Basis of Presentation | ' | ||
Note 1 – Nature of Business and Basis of Presentation | |||
MGIC Investment Corporation is a holding company which, through Mortgage Guaranty Insurance Corporation ("MGIC"), MGIC Indemnity Corporation (“MIC”) and several other subsidiaries, is principally engaged in the mortgage insurance business. We provide mortgage insurance to lenders throughout the United States and to government sponsored entities (“GSEs”) to protect against loss from defaults on low down payment residential mortgage loans. | |||
The accompanying unaudited consolidated financial statements of MGIC Investment Corporation and its wholly-owned subsidiaries have been prepared in accordance with the instructions to Form 10-Q as prescribed by the Securities and Exchange Commission (“SEC”) for interim reporting and do not include all of the other information and disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). These statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2013 included in our Annual Report on Form 10-K. As used below, “we,” “our” and “us” refer to MGIC Investment Corporation’s consolidated operations or to MGIC Investment Corporation, as the context requires. | |||
In the opinion of management the accompanying financial statements include all adjustments, consisting primarily of normal recurring accruals, necessary to fairly state our financial position and results of operations for the periods indicated. The results of operations for the interim period may not be indicative of the results that may be expected for the year ending December 31, 2014. | |||
Capital - GSEs | |||
Since 2008, substantially all of our insurance written has been for loans sold to Fannie Mae and Freddie Mac (the “GSEs”), each of which has mortgage insurer eligibility requirements. The existing eligibility requirements include a minimum financial strength rating of Aa3/AA-. Because MGIC does not meet such financial strength rating requirements (its financial strength rating from Moody’s is Ba3 (with a stable outlook) and from Standard & Poor’s is BB (with a positive outlook)), MGIC is currently operating with each GSE as an eligible insurer under a remediation plan. | |||
On July 10, 2014, the conservator of the GSEs, the Federal Housing Finance Agency (“FHFA”), released draft Private Mortgage Insurer Eligibility Requirements (“draft PMIERs”). The draft PMIERs include revised financial requirements for mortgage insurers (the “GSE Financial Requirements”) that require a mortgage insurer’s “Available Assets” (generally only the most liquid assets of an insurer) to meet or exceed “Minimum Required Assets” (which are calculated from tables of factors with several risk dimensions and are subject to a floor amount). | |||
The public input period for the draft PMIERs ended September 8, 2014. We currently expect the PMIERs to be published in final form by December 31, 2014 and the “effective date” to occur 180 days thereafter. Mortgage insurers will have up to two years after the final PMIERs are published to meet the GSE Financial Requirements (the “transition period”). A mortgage insurer that fails to certify by the effective date that it meets the GSE Financial Requirements would be subject to a transition plan having milestones for actions to achieve compliance. The transition plan would be submitted for the approval of each GSE within 90 days after the effective date, and if approved, the GSEs would monitor the insurer’s progress. During the transition period for an insurer with an approved transition plan, an insurer would be in remediation (a status similar to the one under which MGIC has been operating with the GSEs for over five years) and eligible to provide mortgage insurance on loans owned or guaranteed by the GSEs. | |||
We estimated that as of June 30, 2014, applying the rules of the draft PMIERs, MGIC would have a material shortfall in Available Assets. This shortfall is expected to be reduced by operations throughout the transition period, which is expected to end December 31, 2016. The shortfall assumes the risk in force and capital of MIC are repatriated to MGIC, and full credit is given in the calculation of Minimum Required Assets for our existing reinsurance transaction. However, we do not expect to receive full credit for our current reinsurance transaction. As a result, we are in discussions with the reinsurers participating in our existing reinsurance transaction regarding modifications to the agreement so that any reduction in the credit would be minimized. We have not updated these projections, but do not believe they would have changed significantly. | |||
As of September 30, 2014, we had approximately $517 million of cash and investments at our holding company, a portion of which we believe may be available for future contribution to MGIC. Furthermore, there are regulated insurance affiliates of MGIC that have approximately $100 million of assets as of September 30, 2014. We expect that, subject to regulatory approval, we would be able to use a material portion of these assets to increase the Available Assets of MGIC. Additionally, if the draft PMIERs are implemented as released, we would consider seeking additional reinsurance and/or non-dilutive debt capital to mitigate the shortfall. We believe we will be able to use a combination of the alternatives outlined above so that MGIC will meet the GSE Financial Requirements of the draft PMIERs even if they are implemented as released. However, factors that may negatively impact MGIC’s ability to comply with the GSE Financial Requirements within the transition period include the following: | |||
· | Changes in the actual PMIERs adopted from the draft PMIERs may increase the amount of the MGIC’s Minimum Required Assets or reduce its Available Assets, with the result that the shortfall in Available Assets could increase; | ||
· | We may not obtain regulatory approval to transfer assets from MGIC’s regulated insurance affiliates to the extent we are assuming because regulators project higher losses than we project or require a level of capital be maintained in these companies higher than we are assuming; | ||
· | We may not be able to access the non-dilutive debt markets due to market conditions, concern about our creditworthiness, or other factors, in a manner sufficient to provide the funds we are assuming; | ||
· | We may not be able to achieve modifications in our existing reinsurance arrangements necessary to minimize the reduction in the credit for reinsurance under the draft PMIERs; | ||
· | We may not be able to obtain additional reinsurance necessary to further reduce the Minimum Required Assets due to market capacity, pricing or other reasons (including disapproval of the proposed transaction by a GSE); and | ||
· | Our future operating results may be negatively impacted by the matters discussed throughout the financial statement footnotes. Such matters could decrease our revenues, increase our losses or require the use of assets, thereby reducing our Available Assets and increasing our shortfall in Available Assets, or they could increase the Minimum Required Assets, also increasing our shortfall in Available Assets. | ||
There also can be no assurance that the GSEs would not make the GSE Financial Requirements more onerous in the future; in this regard, the draft PMIERs provide that the tables of factors that determine Minimum Required Assets may be updated to reflect changes in risk characteristics and the macroeconomic environment. If MGIC ceases to be eligible to insure loans purchased by one or both of the GSEs, it would significantly reduce the volume of our new business writings. | |||
If we increase the amount of Available Assets we hold in order to continue to insure GSE loans, the amount of capital we hold may increase. If we increase the amount of capital we hold with respect to insured loans, our returns may decrease unless we increase premiums. An increase in premium rates may not be feasible for a number of reasons, including competition from other private mortgage insurers, the FHA or other credit enhancement products. | |||
See disclosure regarding statutory capital in Note 15 – “Statutory Capital.” | |||
Reclassifications | |||
Certain reclassifications have been made in the accompanying financial statements to 2013 amounts to conform to 2014 presentation. | |||
Restricted cash and cash equivalents | |||
During the second quarter of 2013, approximately $60.3 million was placed in escrow in connection with the two agreements we entered into to resolve our dispute with Countrywide Home Loans (“CHL”) and its affiliate, Bank of America, N.A., as successor to Countrywide Home Loans Servicing LP (“BANA” and collectively with CHL, “Countrywide”) regarding rescissions. In the fourth quarter of 2013, approximately $42.9 million was released from escrow in connection with the BANA agreement. At September 30, 2014 and December 31, 2013, approximately $17.2 million and $17.4 million, respectively, remains in escrow in connection with the CHL agreement. See additional discussion of these settlement agreements in Note 5 – “Litigation and Contingencies.” | |||
Subsequent events | |||
We have considered subsequent events through the date of this filing. |
New_Accounting_Guidance
New Accounting Guidance | 9 Months Ended |
Sep. 30, 2014 | |
New Accounting Guidance [Abstract] | ' |
New Accounting Guidance | ' |
Note 2 - New Accounting Guidance | |
In August 2014, the FASB issued an update that requires an entity's management to evaluate whether there is substantial doubt about that entity’s ability to continue as a going concern and, if so, disclose that fact. An entity's management will also be required to evaluate and disclose whether its plans alleviate that doubt. The guidance is effective for annual periods ending after December 15, 2016 and for interim and annual periods thereafter. We do not expect the adoption of this update to have a material effect on the presentation of our financial statements and notes therein. | |
In July 2013, the FASB issued an update to the accounting standard regarding income taxes. This update provides guidance concerning the balance sheet presentation of an unrecognized tax benefit when a net operating loss carryforward or a tax credit carryforward (the “Carryforwards”) is available. This accounting standard requires an entity to net its liability related to unrecognized tax benefits against the related deferred tax assets for the Carryforwards. A gross presentation will be required when the Carryforwards are not available under the tax law of the applicable jurisdiction or when the Carryforwards would not be used by the entity to settle any additional income taxes resulting from disallowance of the uncertain tax position. This update is effective for fiscal years and interim periods within such years beginning after December 15, 2013. We are currently in compliance with this new guidance. It did not have a significant impact on our consolidated financial statements and disclosures. |
Debt
Debt | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Debt [Abstract] | ' | ||||||||||||||||||||
Debt | ' | ||||||||||||||||||||
Note 3 – Debt | |||||||||||||||||||||
5.375% Senior Notes – due November 2015 | |||||||||||||||||||||
At September 30, 2014 and December 31, 2013 we had outstanding $62.0 million and $82.9 million, respectively, of 5.375% Senior Notes due in November 2015. In February 2014, we repurchased $20.9 million in par value of these notes at a cost slightly above par. Interest on these notes is payable semi-annually in arrears on May 1 and November 1 of each year. These Senior Notes are described in our Annual Report on Form 10-K for the year ended December 31, 2013. That description is qualified in its entirety by the terms of the notes, which are contained in the Indenture, dated as of October 15, 2000, between us and U.S. Bank, National Association, as trustee, and in an Officer's Certificate dated as of October 4, 2005, which specifies the interest rate, maturity date and other terms of the Senior Notes. | |||||||||||||||||||||
Scheduled interest payments on the Senior Notes were $1.7 million and $2.8 million for the nine months ended September 30, 2014 and 2013, respectively. In the first quarter of 2014, we also paid $0.3 million in interest related to our repurchase discussed above. | |||||||||||||||||||||
5% Convertible Senior Notes – due May 2017 | |||||||||||||||||||||
At September 30, 2014 and December 31, 2013 we had outstanding $345 million principal amount of 5% Convertible Senior Notes due in May 2017. Interest on the 5% Notes is payable semi-annually in arrears on May 1 and November 1 of each year. | |||||||||||||||||||||
The 5% Notes are convertible, at the holder's option, at an initial conversion rate, which is subject to adjustment, of 74.4186 shares per $1,000 principal amount at any time prior to the maturity date. This represents an initial conversion price of approximately $13.44 per share. These 5% Notes will be equal in right of payment to our other senior debt and will be senior in right of payment to our existing Convertible Junior Debentures, discussed below. Debt issuance costs are being amortized to interest expense over the contractual life of the 5% Notes. These 5% Notes are described in our Annual Report on Form 10-K for the year ended December 31, 2013. That description is qualified in its entirety by the terms of the notes, which are contained in the Supplemental Indenture, dated as of April 26, 2010, between us and U.S. Bank National Association, as trustee, and the Indenture dated as of October 15, 2000, between us and the trustee. | |||||||||||||||||||||
Interest payments on the 5% Notes were $8.6 million in each of the nine months ended September 30, 2014 and 2013. | |||||||||||||||||||||
2% Convertible Senior Notes – due April 2020 | |||||||||||||||||||||
At September 30, 2014 and December 31, 2013, we had outstanding $500 million principal amount of 2% Convertible Senior Notes due in 2020 which we issued in March 2013. We received net proceeds of approximately $484.6 million after deducting underwriting discount and offering expenses. Interest on the 2% Notes is payable semi-annually in arrears on April 1 and October 1 of each year. The 2% Notes will mature on April 1, 2020, unless earlier repurchased by us or converted. Prior to January 1, 2020, the 2% Convertible Senior Notes are convertible only upon satisfaction of one or more conditions. One such condition is that during any calendar quarter commencing after March 31, 2014, the last reported sale price of our common stock for each of at least 20 trading days during the 30 consecutive trading days ending on, and including, the last trading day of the immediately preceding calendar quarter be greater than or equal to 130% of the applicable conversion price on each applicable trading day. The notes are convertible at an initial conversion rate, which is subject to adjustment, of 143.8332 shares per $1,000 principal amount. This represents an initial conversion price of approximately $6.95 per share. 130% of such conversion price is $9.03. On or after January 1, 2020, holders may convert their notes irrespective of satisfaction of the conditions. These 2% Notes will be equal in right of payment to our other senior debt and will be senior in right of payment to our existing Convertible Junior Debentures. Debt issuance costs are being amortized to interest expense over the contractual life of the 2% Notes. Prior to April 10, 2017, the notes will not be redeemable. On any business day on or after April 10, 2017 we may redeem for cash all or part of the notes, at our option, at a redemption price equal to 100% of the principal amount of the notes being redeemed, plus any accrued and unpaid interest, if the closing sale price of our common stock exceeds 130% of the then prevailing conversion price of the notes for at least 20 of the 30 trading days preceding notice of the redemption. | |||||||||||||||||||||
These 2% Notes are described in our Annual Report on Form 10-K for the year ended December 31, 2013. That description is qualified in its entirety by the terms of the notes, which are contained in the Second Supplemental Indenture, dated March 12, 2013, between us and U.S. Bank National Association, as trustee, and the Indenture dated as of October 15, 2000, between us and the trustee. | |||||||||||||||||||||
Interest payments on the 2% Notes were $5.0 million for the nine months ended September 30, 2014. There were no scheduled interest payments on the 2% Notes for the nine months ended September 30, 2013. | |||||||||||||||||||||
9% Convertible Junior Subordinated Debentures – due April 2063 | |||||||||||||||||||||
At September 30, 2014 and December 31, 2013 we had outstanding $389.5 million principal amount of 9% Convertible Junior Subordinated Debentures due in 2063 (the “debentures”). The debentures rank junior to all of our existing and future senior indebtedness. | |||||||||||||||||||||
Interest on the debentures is payable semi-annually in arrears on April 1 and October 1 of each year. As long as no event of default with respect to the debentures has occurred and is continuing, we may defer interest, under an optional deferral provision, for one or more consecutive interest periods up to ten years without giving rise to an event of default. Deferred interest will accrue additional interest at the rate then applicable to the debentures. During an optional deferral period we may not pay or declare dividends on our common stock. | |||||||||||||||||||||
Interest on the debentures that would have been payable on the scheduled interest payment date of October 1, 2012 had been deferred. During the deferral period the deferred interest continued to accrue and compound semi-annually at an annual rate of 9%. | |||||||||||||||||||||
On April 1, 2013 we paid the deferred interest payment, including the compound interest. The interest payment, totaling approximately $18.3 million, was made from the net proceeds of our March 2013 common stock offering. We also paid the regular April 1, 2013 interest payment due on the debentures of approximately $17.5 million, and we remain current on all interest payments due. We continue to have the right to defer interest that is payable on subsequent scheduled interest payment dates. Any deferral of such interest would be on terms equivalent to those described above. | |||||||||||||||||||||
These debentures are described in our Annual Report on Form 10-K for the year ended December 31, 2013. That description is qualified in its entirety by the terms of the debentures, which are contained in the Indenture, dated as of March 28, 2008, between us and U.S. Bank National Association, as trustee. | |||||||||||||||||||||
We may redeem the debentures in whole or in part from time to time, at our option, at a redemption price equal to 100% of the principal amount of the debentures being redeemed, plus any accrued and unpaid interest, if the closing sale price of our common stock exceeds 130% of the then prevailing conversion price of the debentures for at least 20 of the 30 trading days preceding notice of the redemption. | |||||||||||||||||||||
The debentures are currently convertible, at the holder's option, at an initial conversion rate, which is subject to adjustment, of 74.0741 common shares per $1,000 principal amount of debentures at any time prior to the maturity date. This represents an initial conversion price of approximately $13.50 per share. If a holder elects to convert their debentures, deferred interest owed on the debentures being converted is also converted into shares of our common stock. The conversion rate for any deferred interest is based on the average price that our shares traded at during a 5-day period immediately prior to the election to convert. In lieu of issuing shares of common stock upon conversion of the debentures, we may, at our option, make a cash payment to converting holders for all or some of the shares of our common stock otherwise issuable upon conversion. | |||||||||||||||||||||
Interest payments on the debentures were $17.5 million and $35.8 million for the nine months ended September 30, 2014 and 2013, respectively. | |||||||||||||||||||||
All debt | |||||||||||||||||||||
The par value and fair value of our debt at September 30, 2014 and December 31, 2013 appears in the table below. | |||||||||||||||||||||
Significant | |||||||||||||||||||||
Quoted Prices in | Other | Significant | |||||||||||||||||||
Active Markets | Observable | Unobservable | |||||||||||||||||||
Total Fair | for Identical | Inputs | Inputs | ||||||||||||||||||
Par Value | Value | Assets (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
30-Sep-14 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||
Senior Notes | $ | 61,953 | $ | 63,696 | $ | - | $ | 63,696 | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 374,498 | 374,498 | - | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 656,250 | 656,250 | - | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 497,371 | - | 497,371 | - | ||||||||||||||||
Total Debt | $ | 1,296,475 | $ | 1,591,815 | $ | 1,030,748 | $ | 561,067 | $ | - | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||
Senior Notes | $ | 82,883 | $ | 85,991 | $ | 85,991 | $ | - | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 388,988 | 388,988 | - | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 685,625 | 685,625 | - | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 439,186 | - | 439,186 | - | ||||||||||||||||
Total Debt | $ | 1,317,405 | $ | 1,599,790 | $ | 1,160,604 | $ | 439,186 | $ | - | |||||||||||
The fair value of our debt is disclosed in accordance with the fair value hierarchy described in Note 8 – “Fair Value Measurements.” | |||||||||||||||||||||
The Senior Notes, Convertible Senior Notes and Convertible Junior Debentures are obligations of our holding company, MGIC Investment Corporation, and not of its subsidiaries. At September 30, 2014, we had approximately $517 million in cash and investments at our holding company. The net unrealized losses on our holding company investment portfolio were approximately $4.5 million at September 30, 2014. The modified duration of the holding company investment portfolio, excluding cash and cash equivalents, was 3.3 years at September 30, 2014. |
Reinsurance
Reinsurance | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Reinsurance [Abstract] | ' | ||||||||
Reinsurance | ' | ||||||||
Note 4 – Reinsurance | |||||||||
In April 2013, we entered into a quota share reinsurance agreement with a group of unaffiliated reinsurers that are not captive reinsurers. These reinsurers primarily have a rating of A or better by Moody’s Investors Service, Standard & Poor’s Rating Services or both. This reinsurance agreement applies to new insurance written between April 1, 2013 and December 31, 2015 (with certain exclusions) and covers incurred losses, with renewal premium through December 31, 2018, at which time the agreement terminates. Early termination of the agreement prior to December 31, 2018 is possible under specified scenarios. The structure of the reinsurance agreement is a 30% quota share, with a 20% ceding commission as well as a profit commission. In December 2013, we entered into an Addendum to the quota share reinsurance agreement that applies to certain insurance written before April 1, 2013 that has never been delinquent. The structure of the quota share reinsurance agreement remained the same, with the exception that the business written before April 1, 2013 is a 40% quota share. Under the Addendum, the premium which was received and unearned as of December 31, 2013 for policies covered by the Addendum was ceded. | |||||||||
As of September 30, 2014 and December 31, 2013, we have accrued a profit commission receivable of $69.0 million and $2.4 million, respectively. This receivable could increase materially through the term of the agreement, but the ultimate amount of the commission will depend on the ultimate level of premiums earned and losses incurred under the agreement. Any profit commission would be paid to us upon termination of the reinsurance agreement. | |||||||||
The reinsurers are required to maintain trust funds or letters of credit to support recoverable balances for reinsurance, such as loss reserves, paid losses, prepaid reinsurance premiums and profit commissions. As such forms of collateral are in place, we have not established an allowance against these balances. | |||||||||
In the past, MGIC had also obtained captive reinsurance. In a captive reinsurance arrangement, the reinsurer is affiliated with the lender for whom MGIC provides mortgage insurance. As part of our settlement with the Consumer Financial Protection Bureau (“CFPB”) discussed in Note 5 – “Litigation and Contingencies,” MGIC and three other mortgage insurers agreed that they would not enter into any new captive reinsurance agreement or reinsure any new loans under any existing captive reinsurance agreement for a period of ten years. In accordance with this settlement, all of our active captive arrangements have been placed into run-off. | |||||||||
Captive agreements were written on an annual book of business and the captives are required to maintain a separate trust account to support the combined reinsured risk on all annual books. MGIC is the sole beneficiary of the trust, and the trust account is made up of capital deposits by the lender captive, premium deposits by MGIC, and investment income earned. These amounts are held in the trust account and are available to pay reinsured losses. The reinsurance recoverable on loss reserves related to captive agreements was $48 million at September 30, 2014 which was supported by $205 million of trust assets, while at December 31, 2013, the reinsurance recoverable on loss reserves related to captives was $64 million which was supported by $226 million of trust assets. At September 30, 2014 and December 31, 2013 there was an additional $6 million and $23 million, respectively, of trust assets in captive agreements where there was no related reinsurance recoverable on loss reserves. See Note 5 – “Litigation and Contingencies” for a discussion of requests or subpoenas for information regarding captive mortgage reinsurance arrangements. | |||||||||
A summary of the effect of our reinsurance agreements on our results for the nine months ended September 30, 2014 and 2013 appears below. | |||||||||
Nine Months Ended | |||||||||
September 30, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Ceded premiums written, net of profit commission | $ | 87,450 | $ | 31,473 | |||||
Ceded premiums earned, net of profit commission | 79,460 | 23,499 | |||||||
Ceded losses incurred | 22,451 | 21,238 | |||||||
Ceding commissions | 28,994 | 4,646 |
Litigation_and_Contingencies
Litigation and Contingencies | 9 Months Ended |
Sep. 30, 2014 | |
Litigation and Contingencies [Abstract] | ' |
Litigation and Contingencies | ' |
Note 5 – Litigation and Contingencies | |
Before paying a claim, we review the loan and servicing files to determine the appropriateness of the claim amount. All of our insurance policies provide that we can reduce or deny a claim if the servicer did not comply with its obligations under our insurance policy, including the requirement to mitigate our loss by performing reasonable loss mitigation efforts or, for example, diligently pursuing a foreclosure or bankruptcy relief in a timely manner. We call such reduction of claims submitted to us “curtailments.” In 2013 and the first nine months of 2014, curtailments reduced our average claim paid by approximately 5.8% and 6.5%, respectively. In addition, the claims submitted to us sometimes include costs and expenses not covered by our insurance policies, such as hazard insurance premiums for periods after the claim date and losses resulting from property damage that has not been repaired. These other adjustments reduced claim amounts by less than the amount of curtailments. After we pay a claim, servicers and insureds sometimes object to our curtailments and other adjustments. We review these objections if they are sent to us within 90 days after the claim was paid. | |
When reviewing the loan file associated with a claim, we may determine that we have the right to rescind coverage on the loan. Prior to 2008, rescissions of coverage on loans were not a material portion of our claims resolved during a year. However, beginning in 2008, our rescissions of coverage on loans have materially mitigated our paid losses. In 2009 through 2011, rescissions mitigated our paid losses in the aggregate by approximately $3.0 billion; and in 2012, 2013 and the first nine months of 2014, rescissions mitigated our paid losses by approximately $0.3 billion, $135 million and $75 million, respectively (in each case, the figure includes amounts that would have either resulted in a claim payment or been charged to a deductible under a bulk or pool policy, and may have been charged to a captive reinsurer). In recent quarters, approximately 5% of claims received in a quarter have been resolved by rescissions, down from the peak of approximately 28% in the first half of 2009. | |
We estimate rescissions mitigated our incurred losses by approximately $2.5 billion in 2009 and $0.2 billion in 2010. These figures include the benefit of claims not paid in the period as well as the impact of changes in our estimated expected rescission activity on our loss reserves in the period. In 2012, we estimate that our rescission benefit in loss reserves was reduced by $0.2 billion due to probable rescission settlement agreements. We estimate that other rescissions had no significant impact on our losses incurred in 2011 through the first nine months of 2014. Our loss reserving methodology incorporates our estimates of future rescissions and reversals of rescissions. Historically, reversals of rescissions have been immaterial. A variance between ultimate actual rescission and reversal rates and our estimates, as a result of the outcome of litigation, settlements or other factors, could materially affect our losses. | |
If the insured disputes our right to rescind coverage, we generally engage in discussions in an attempt to settle the dispute. As part of those discussions, we may voluntarily suspend rescissions we believe may be part of a settlement. In 2011, Freddie Mac advised its servicers that they must obtain its prior approval for rescission settlements, Fannie Mae advised its servicers that they are prohibited from entering into such settlements and Fannie Mae notified us that we must obtain its prior approval to enter into certain settlements. Since those announcements, the GSEs have consented to our settlement agreements with two customers, one of which is Countrywide, as discussed below, and have rejected other settlement agreements. We have reached and implemented settlement agreements that do not require GSE approval, but they have not been material in the aggregate. | |
If we are unable to reach a settlement, the outcome of a dispute ultimately would be determined by legal proceedings. Under our policies, legal proceedings disputing our right to rescind coverage may be brought up to three years after the lender has obtained title to the property (typically through a foreclosure) or the property was sold in a sale that we approved, whichever is applicable, although in a few jurisdictions there is a longer time to bring such an action. | |
Until a liability associated with a settlement agreement or litigation becomes probable and can be reasonably estimated, we consider our claim payment or rescission resolved for financial reporting purposes even though discussions and legal proceedings have been initiated and are ongoing. Under ASC 450-20, an estimated loss from such discussions and proceedings is accrued for only if we determine that the loss is probable and can be reasonably estimated. | |
Since December 2009, we have been involved in legal proceedings with Countrywide Home Loans, Inc. (“CHL”) and its affiliate, Bank of America, N.A., as successor to Countrywide Home Loans Servicing LP (“BANA” and collectively with CHL, “Countrywide”) in which Countrywide alleged that MGIC denied valid mortgage insurance claims. (In our SEC reports, we refer to insurance rescissions and denials of claims collectively as “rescissions” and variations of that term.) In addition to the claim amounts it alleged MGIC had improperly denied, Countrywide contended it was entitled to other damages of almost $700 million as well as exemplary damages. We sought a determination in those proceedings that we were entitled to rescind coverage on the applicable loans. | |
In April 2013, MGIC entered into separate settlement agreements with CHL and BANA, pursuant to which the parties will settle the Countrywide litigation as it relates to MGIC’s rescission practices (as amended, the “Agreements”). The Agreement with BANA covers loans purchased by the GSEs. That original Agreement was implemented beginning in November 2013 and we resolved all related suspended rescissions in November and December 2013 by paying the associated claim or processing the rescission. The pending arbitration proceedings concerning the loans covered by that agreement have been dismissed, the mutual releases between the parties regarding such loans have become effective and the litigation between the parties regarding such loans is to be dismissed. | |
The Agreement with CHL covers loans that were purchased by non-GSE investors, including securitization trusts (the “other investors”). That Agreement will be implemented only as and to the extent that it is consented to by or on behalf of the other investors. While there can be no assurance that the Agreement with CHL will be implemented, we have determined that its implementation is probable. | |
We recorded the estimated impact of the Agreements and another probable settlement in our financial statements for the quarter ending December 31, 2012. We have also recorded the estimated impact of other probable settlements, including a previously disclosed curtailment dispute with Countrywide. The estimated impact that we recorded is our best estimate of our loss from these matters. We estimate that the maximum exposure above the best estimate provision we recorded is $670 million, of which about 58% is related to claims paying practices subject to the Agreement with CHL and the curtailment dispute with Countrywide. If we are not able to implement the Agreement with CHL or the other settlements we consider probable, we intend to defend MGIC vigorously against any related legal proceedings. | |
The flow policies at issue with Countrywide are in the same form as the flow policies that we used with all of our customers during the period covered by the Agreements, and the bulk policies at issue vary from one another, but are generally similar to those used in the majority of our Wall Street bulk transactions. | |
We are involved in discussions and legal and consensual proceedings with customers with respect to our claims paying practices. Although it is reasonably possible that when these discussions or proceedings are completed we will not prevail in all cases, we are unable to make a reasonable estimate or range of estimates of the potential liability. We estimate the maximum exposure associated with these discussions and proceedings to be approximately $38 million, although we believe we will ultimately resolve these matters for significantly less than this amount. | |
The estimates of our maximum exposure referred to above do not include interest or consequential or exemplary damages. | |
Consumers continue to bring lawsuits against home mortgage lenders and settlement service providers. Mortgage insurers, including MGIC, have been involved in litigation alleging violations of the anti-referral fee provisions of the Real Estate Settlement Procedures Act, which is commonly known as RESPA, and the notice provisions of the Fair Credit Reporting Act, which is commonly known as FCRA. MGIC’s settlement of class action litigation against it under RESPA became final in October 2003. MGIC settled the named plaintiffs’ claims in litigation against it under FCRA in December 2004, following denial of class certification in June 2004. Since December 2006, class action litigation has been brought against a number of large lenders alleging that their captive mortgage reinsurance arrangements violated RESPA. Beginning in December 2011, MGIC, together with various mortgage lenders and other mortgage insurers, has been named as a defendant in twelve lawsuits, alleged to be class actions, filed in various U.S. District Courts. Seven of those cases have previously been dismissed without any further opportunity to appeal. The complaints in all of the cases allege various causes of action related to the captive mortgage reinsurance arrangements of the mortgage lenders, including that the lenders’ captive reinsurers received excessive premiums in relation to the risk assumed by those captives, thereby violating RESPA. MGIC denies any wrongdoing and intends to vigorously defend itself against the allegations in the lawsuits. There can be no assurance that we will not be subject to further litigation under RESPA (or FCRA) or that the outcome of any such litigation, including the lawsuits mentioned above, would not have a material adverse effect on us. | |
In 2013, the U.S. District Court for the Southern District of Florida approved a settlement with the CFPB that resolved a federal investigation of MGIC’s participation in captive reinsurance arrangements in the mortgage insurance industry. The settlement concluded the investigation with respect to MGIC without the CFPB or the court making any findings of wrongdoing. As part of the settlement, MGIC agreed that it would not enter into any new captive reinsurance agreement or reinsure any new loans under any existing captive reinsurance agreement for a period of ten years. MGIC had voluntarily suspended most of its captive arrangements in 2008 in response to market conditions and GSE requests. In connection with the settlement, MGIC paid a civil penalty of $2.65 million and the court issued an injunction prohibiting MGIC from violating any provisions of RESPA. | |
We received requests from the Minnesota Department of Commerce (the “MN Department”) beginning in February 2006 regarding captive mortgage reinsurance and certain other matters in response to which MGIC has provided information on several occasions, including as recently as May 2011. In August 2013, MGIC and several competitors received a draft Consent Order from the MN Department containing proposed conditions to resolve its investigation, including unspecified penalties. We are engaged in discussions with the MN Department regarding the draft Consent Order. We also received a request in June 2005 from the New York Department of Financial Services for information regarding captive mortgage reinsurance arrangements and other types of arrangements in which lenders receive compensation. Other insurance departments or other officials, including attorneys general, may also seek information about, investigate, or seek remedies regarding captive mortgage reinsurance. | |
Various regulators, including the CFPB, state insurance commissioners and state attorneys general may bring actions seeking various forms of relief in connection with violations of RESPA. The insurance law provisions of many states prohibit paying for the referral of insurance business and provide various mechanisms to enforce this prohibition. While we believe our practices are in conformity with applicable laws and regulations, it is not possible to predict the eventual scope, duration or outcome of any such reviews or investigations nor is it possible to predict their effect on us or the mortgage insurance industry. | |
We are subject to comprehensive, detailed regulation by state insurance departments. These regulations are principally designed for the protection of our insured policyholders, rather than for the benefit of investors. Although their scope varies, state insurance laws generally grant broad supervisory powers to agencies or officials to examine insurance companies and enforce rules or exercise discretion affecting almost every significant aspect of the insurance business. State insurance regulatory authorities could take actions, including changes in capital requirements, that could have a material adverse effect on us. In addition, the CFPB may issue additional rules or regulations, which may materially affect our business. | |
In December 2013, the U.S. Treasury Department’s Federal Insurance Office released a report that calls for federal standards and oversight for mortgage insurers to be developed and implemented. It is uncertain what form the standards and oversight will take and when they will become effective. | |
We understand several law firms have, among other things, issued press releases to the effect that they are investigating us, including whether the fiduciaries of our 401(k) plan breached their fiduciary duties regarding the plan’s investment in or holding of our common stock or whether we breached other legal or fiduciary obligations to our shareholders. We intend to defend vigorously any proceedings that may result from these investigations. With limited exceptions, our bylaws provide that our officers and 401(k) plan fiduciaries are entitled to indemnification from us for claims against them. | |
A non-insurance subsidiary of our holding company is a shareholder of the corporation that operates the Mortgage Electronic Registration System (“MERS”). Our subsidiary, as a shareholder of MERS, has been named as a defendant (along with MERS and its other shareholders) in eight lawsuits asserting various causes of action arising from allegedly improper recording and foreclosure activities by MERS. Seven of these lawsuits have been dismissed without any further opportunity to appeal. The remaining lawsuit had also been dismissed by the U.S. District Court, however, the plaintiff in that lawsuit filed a motion for reconsideration by the U.S. District Court and to certify a related question of law to the Supreme Court of the State in which the U.S. District Court is located. That motion for reconsideration was denied, however, in May 2014, the plaintiff appealed the denial. The damages sought in this remaining case are substantial. We deny any wrongdoing and intend to defend ourselves vigorously against the allegations in the lawsuit. | |
In addition to the matters described above, we are involved in other legal proceedings in the ordinary course of business. In our opinion, based on the facts known at this time, the ultimate resolution of these ordinary course legal proceedings will not have a material adverse effect on our financial position or results of operations. | |
Through a non-insurance subsidiary, we utilize our underwriting skills to provide an outsourced underwriting service to our customers known as contract underwriting. As part of the contract underwriting activities, that subsidiary is responsible for the quality of the underwriting decisions in accordance with the terms of the contract underwriting agreements with customers. That subsidiary may be required to provide certain remedies to its customers if certain standards relating to the quality of our underwriting work are not met, and we have an established reserve for such future obligations. Claims for remedies may be made a number of years after the underwriting work was performed. Beginning in the second half of 2009, our subsidiary experienced an increase in claims for contract underwriting remedies, which continued throughout 2012. The underwriting remedy expense for 2013 and the first nine months of 2014 was approximately $5 million and $3 million, respectively, but may increase in the future. | |
See Note 11 – “Income Taxes” for a description of federal income tax contingencies. |
Earnings_Loss_per_Share
Earnings (Loss) per Share | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Earnings (Loss) per Share [Abstract] | ' | ||||||||||||||||
Earnings (Loss) per Share | ' | ||||||||||||||||
Note 6 – Earnings (Loss) per Share | |||||||||||||||||
Our basic EPS is based on the weighted average number of common shares outstanding, which excludes participating securities of 0.1 million for the nine months ended September 30, 2013 because they were anti-dilutive due to our reported net loss. Participating securities of 0.1 million were included in our weighted average number of common shares outstanding for the three and nine months ended September 30, 2014 and for the three months ended September 30, 2013. Typically, diluted EPS is based on the weighted average number of common shares outstanding plus common stock equivalents which include certain stock awards and the dilutive effect of our convertible debt. In accordance with accounting guidance, if we report a net loss from continuing operations then our diluted EPS is computed in the same manner as the basic EPS. In addition if any common stock equivalents are anti-dilutive they are excluded from the calculation. The following includes a reconciliation of the weighted average number of shares; however for the three months ended September 30, 2014 and 2013 common stock equivalents of 54.5 million and 126.5 million, respectively, and for the nine months ended September 30, 2014 and 2013 common stock equivalents of 54.5 million and 109.6 million, respectively, were not included because they were anti-dilutive. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands, except per share data) | |||||||||||||||||
Basic earnings per share: | |||||||||||||||||
Net income (loss) | $ | 72,017 | $ | 12,114 | $ | 177,521 | $ | (48,441 | ) | ||||||||
Weighted average common shares outstanding | 338,626 | 337,868 | 338,488 | 302,996 | |||||||||||||
Basic income (loss) per share | $ | 0.21 | $ | 0.04 | $ | 0.52 | $ | (0.16 | ) | ||||||||
Diluted earnings per share: | |||||||||||||||||
Net income (loss) | $ | 72,017 | $ | 12,114 | $ | 177,521 | $ | (48,441 | ) | ||||||||
Effect of dilutive securities: | |||||||||||||||||
2% Convertible Senior Notes | 3,049 | - | 9,148 | - | |||||||||||||
Net income (loss) plus assumed conversions | $ | 75,066 | $ | 12,114 | $ | 186,669 | $ | (48,441 | ) | ||||||||
Weighted-average shares - Basic | 338,626 | 337,868 | 338,488 | 302,996 | |||||||||||||
Common stock equivalents | 74,950 | 1,558 | 74,985 | - | |||||||||||||
Weighted-average shares - Diluted | 413,576 | 339,426 | 413,473 | 302,996 | |||||||||||||
Diluted income (loss) per share | $ | 0.18 | $ | 0.04 | $ | 0.45 | $ | (0.16 | ) |
Investments
Investments | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
Investments [Abstract] | ' | ||||||||||||||||||||||||
Investments | ' | ||||||||||||||||||||||||
Note 7 – Investments | |||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at September 30, 2014 and December 31, 2013 are shown below. | |||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||
30-Sep-14 | Cost | Gains | Losses (1) | Value | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 414,778 | $ | 2,636 | $ | (9,795 | ) | $ | 407,619 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 833,510 | 10,068 | (4,316 | ) | 839,262 | ||||||||||||||||||||
Corporate debt securities | 2,341,189 | 9,953 | (12,587 | ) | 2,338,555 | ||||||||||||||||||||
Asset-backed securities | 341,519 | 932 | (202 | ) | 342,249 | ||||||||||||||||||||
Residential mortgage-backed securities | 344,515 | 167 | (13,751 | ) | 330,931 | ||||||||||||||||||||
Commercial mortgage-backed securities | 269,857 | 675 | (3,032 | ) | 267,500 | ||||||||||||||||||||
Collateralized loan obligations | 61,339 | - | (763 | ) | 60,576 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 37,854 | 2,466 | (33 | ) | 40,287 | ||||||||||||||||||||
Total debt securities | 4,644,561 | 26,897 | (44,479 | ) | 4,626,979 | ||||||||||||||||||||
Equity securities | 2,968 | 63 | (9 | ) | 3,022 | ||||||||||||||||||||
Total investment portfolio | $ | 4,647,529 | $ | 26,960 | $ | (44,488 | ) | $ | 4,630,001 | ||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||
31-Dec-13 | Cost | Gains | Losses (1) | Value | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 663,642 | $ | 1,469 | $ | (25,521 | ) | $ | 639,590 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 932,922 | 5,865 | (17,420 | ) | 921,367 | ||||||||||||||||||||
Corporate debt securities | 2,190,095 | 6,313 | (24,993 | ) | 2,171,415 | ||||||||||||||||||||
Asset-backed securities | 399,839 | 1,100 | (453 | ) | 400,486 | ||||||||||||||||||||
Residential mortgage-backed securities | 383,368 | 146 | (24,977 | ) | 358,537 | ||||||||||||||||||||
Commercial mortgage-backed securities | 277,920 | 131 | (6,668 | ) | 271,383 | ||||||||||||||||||||
Collateralized loan obligations | 61,337 | - | (1,042 | ) | 60,295 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 39,420 | 1,722 | (290 | ) | 40,852 | ||||||||||||||||||||
Total debt securities | 4,948,543 | 16,746 | (101,364 | ) | 4,863,925 | ||||||||||||||||||||
Equity securities | 2,908 | 9 | (23 | ) | 2,894 | ||||||||||||||||||||
Total investment portfolio | $ | 4,951,451 | $ | 16,755 | $ | (101,387 | ) | $ | 4,866,819 | ||||||||||||||||
(1) At September 30, 2014 and December 31, 2013, there were no other-than-temporary impairment losses recorded in other comprehensive income. | |||||||||||||||||||||||||
Our foreign investments primarily consist of the investment portfolio supporting our Australian domiciled subsidiary. This portfolio is comprised of Australian government and semi government securities, representing 86% of the market value of our foreign investments with the remaining 10% invested in corporate securities and 4% in cash equivalents. Seventy-nine percent of the Australian portfolio is rated AAA, by one or more of Moody’s, Standard & Poor’s and Fitch Ratings, and the remaining 21% is rated AA. | |||||||||||||||||||||||||
The amortized cost and fair values of debt securities at September 30, 2014, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Because most asset-backed and mortgage-backed securities and collateralized loan obligations provide for periodic payments throughout their lives, they are listed below in separate categories. | |||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||
30-Sep-14 | Cost | Value | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Due in one year or less | $ | 405,324 | $ | 406,256 | |||||||||||||||||||||
Due after one year through five years | 1,858,612 | 1,863,872 | |||||||||||||||||||||||
Due after five years through ten years | 928,153 | 922,372 | |||||||||||||||||||||||
Due after ten years | 435,242 | 433,223 | |||||||||||||||||||||||
$ | 3,627,331 | $ | 3,625,723 | ||||||||||||||||||||||
Asset-backed securities | 341,519 | 342,249 | |||||||||||||||||||||||
Residential mortgage-backed securities | 344,515 | 330,931 | |||||||||||||||||||||||
Commercial mortgage-backed securities | 269,857 | 267,500 | |||||||||||||||||||||||
Collateralized loan obligations | 61,339 | 60,576 | |||||||||||||||||||||||
Total at September 30, 2014 | $ | 4,644,561 | $ | 4,626,979 | |||||||||||||||||||||
At September 30, 2014 and December 31, 2013, the investment portfolio had gross unrealized losses of $44.5 million and $101.4 million, respectively. For those securities in an unrealized loss position, the length of time the securities were in such a position, as measured by their month-end fair values, is as follows: | |||||||||||||||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | ||||||||||||||||||||
30-Sep-14 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 6,320 | $ | 43 | $ | 325,892 | $ | 9,752 | $ | 332,212 | $ | 9,795 | |||||||||||||
Obligations of U.S. states and political subdivisions | 165,975 | 1,392 | 135,146 | 2,924 | 301,121 | 4,316 | |||||||||||||||||||
Corporate debt securities | 1,000,551 | 5,995 | 233,161 | 6,592 | 1,233,712 | 12,587 | |||||||||||||||||||
Asset-backed securities | 56,801 | 137 | 14,675 | 65 | 71,476 | 202 | |||||||||||||||||||
Residential mortgage-backed securities | 15,020 | 55 | 307,151 | 13,696 | 322,171 | 13,751 | |||||||||||||||||||
Commercial mortgage-backed securities | 91,505 | 855 | 112,195 | 2,177 | 203,700 | 3,032 | |||||||||||||||||||
Collateralized loan obligations | - | - | 60,576 | 763 | 60,576 | 763 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | 4,561 | 10 | 1,783 | 23 | 6,344 | 33 | |||||||||||||||||||
Equity securities | 137 | 1 | 238 | 8 | 375 | 9 | |||||||||||||||||||
Total investment portfolio | $ | 1,340,870 | $ | 8,488 | $ | 1,190,817 | $ | 36,000 | $ | 2,531,687 | $ | 44,488 | |||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | ||||||||||||||||||||
31-Dec-13 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 465,975 | $ | 24,980 | $ | 4,103 | $ | 541 | $ | 470,078 | $ | 25,521 | |||||||||||||
Obligations of U.S. states and political subdivisions | 503,967 | 17,370 | 4,226 | 50 | 508,193 | 17,420 | |||||||||||||||||||
Corporate debt securities | 1,238,211 | 20,371 | 81,593 | 4,622 | 1,319,804 | 24,993 | |||||||||||||||||||
Asset-backed securities | 126,991 | 387 | 7,114 | 66 | 134,105 | 453 | |||||||||||||||||||
Residential mortgage-backed securities | 91,534 | 3,886 | 265,827 | 21,091 | 357,361 | 24,977 | |||||||||||||||||||
Commercial mortgage-backed securities | 192,440 | 6,239 | 43,095 | 429 | 235,535 | 6,668 | |||||||||||||||||||
Collateralized loan obligations | 60,295 | 1,042 | - | - | 60,295 | 1,042 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | 7,203 | 290 | - | - | 7,203 | 290 | |||||||||||||||||||
Equity securities | 1,012 | 18 | 75 | 5 | 1,087 | 23 | |||||||||||||||||||
Total investment portfolio | $ | 2,687,628 | $ | 74,583 | $ | 406,033 | $ | 26,804 | $ | 3,093,661 | $ | 101,387 | |||||||||||||
The unrealized losses in all categories of our investments at September 30, 2014 and December 31, 2013 were primarily caused by the difference in interest rates at each respective period, compared to interest rates at the time of purchase. | |||||||||||||||||||||||||
Under the current guidance a debt security impairment is deemed other than temporary if we either intend to sell the security, or it is more likely than not that we will be required to sell the security before recovery or we do not expect to collect cash flows sufficient to recover the amortized cost basis of the security. During each of the three and nine months ended September 30, 2014 there were no other-than-temporary impairments (“OTTI”) recognized. There were $0.3 million of OTTI losses recognized during the three and nine months ended September 30, 2013. | |||||||||||||||||||||||||
The net realized investment gains (losses) and OTTI on the investment portfolio are as follows: | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) and OTTI on investments: | |||||||||||||||||||||||||
Fixed maturities | $ | 629 | $ | (393 | ) | $ | 755 | $ | 2,755 | ||||||||||||||||
Equity securities | 3 | 254 | 168 | 850 | |||||||||||||||||||||
$ | 632 | $ | (139 | ) | $ | 923 | $ | 3,605 | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) and OTTI on investments: | |||||||||||||||||||||||||
Gains on sales | $ | 1,161 | $ | 391 | $ | 3,273 | $ | 5,352 | |||||||||||||||||
Losses on sales | (529 | ) | (202 | ) | (2,350 | ) | (1,419 | ) | |||||||||||||||||
Impairment losses | - | (328 | ) | - | (328 | ) | |||||||||||||||||||
$ | 632 | $ | (139 | ) | $ | 923 | $ | 3,605 |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||||||
Fair Value Measurements | ' | ||||||||||||||||||||
Note 8 – Fair Value Measurements | |||||||||||||||||||||
In accordance with fair value guidance, we applied the following fair value hierarchy in order to measure fair value for assets and liabilities: | |||||||||||||||||||||
Level 1 – Quoted prices for identical instruments in active markets that we can access. Financial assets utilizing Level 1 inputs primarily include U.S. Treasury securities and Australian government and semi government securities. | |||||||||||||||||||||
Level 2 – Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and inputs, other than quoted prices, that are observable in the marketplace for the financial instrument. The observable inputs are used in valuation models to calculate the fair value of the financial instruments. Financial assets utilizing Level 2 inputs primarily include obligations of U.S. government corporations and agencies and certain municipal and corporate bonds. | |||||||||||||||||||||
Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or value drivers are unobservable. Level 3 inputs reflect our own assumptions about the assumptions a market participant would use in pricing an asset or liability. Financial assets utilizing Level 3 inputs include certain state premium tax credit investments. Our non-financial assets that are classified as Level 3 securities consist of real estate acquired through claim settlement that is fair valued at the lower of our acquisition cost or a percentage of appraised value. The percentage applied to appraised value is based upon our historical sales experience adjusted for current trends. | |||||||||||||||||||||
To determine the fair value of securities available-for-sale in Level 1 and Level 2 of the fair value hierarchy, independent pricing sources have been utilized. One price is provided per security based on observable market data. To ensure securities are appropriately classified in the fair value hierarchy, we review the pricing techniques and methodologies of the independent pricing sources and believe that their policies adequately consider market activity, either based on specific transactions for the issue valued or based on modeling of securities with similar credit quality, duration, yield and structure that were recently traded. A variety of inputs are utilized by the independent pricing sources including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer spreads, two sided markets, benchmark securities, bids, offers and reference data including data published in market research publications. Inputs may be weighted differently for any security, and not all inputs are used for each security evaluation. Market indicators, industry and economic events are also considered. This information is evaluated using a multidimensional pricing model. Quality controls are performed by the independent pricing sources throughout this process, which include reviewing tolerance reports, trading information and data changes, and directional moves compared to market moves. This model combines all inputs to arrive at a value assigned to each security. In addition, on a quarterly basis, we perform quality controls over values received from the pricing sources which include reviewing tolerance reports, trading information and data changes, and directional moves compared to market moves. We have not made any adjustments to the prices obtained from the independent pricing sources. | |||||||||||||||||||||
During the quarter ended September 30, 2014, we changed the classification of our U.S. government corporation and agency securities with a fair value of $215 million, from Level 1 to Level 2 in the fair value hierarchy. The fair value of our U.S. government corporation and agency securities, in current market conditions, is determined from quoted prices for similar instruments in active markets, which is in accordance with our policy for determining fair value for Level 2 securities. The classification of these securities in the fair value table as of December 31, 2013 has been revised, as we believe the most appropriate classification for these securities was Level 2 at that date. There were no other transfers between Level 1 and Level 2 during the nine months ended September 30, 2014. | |||||||||||||||||||||
Fair value measurements for assets measured at fair value included the following as of September 30, 2014 and December 31, 2013: | |||||||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||||||
Fair Value | Active Markets for | Other Observable Inputs | Unobservable | ||||||||||||||||||
Identical Assets | (Level 2) | Inputs | |||||||||||||||||||
(Level 1) | (Level 3) | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
30-Sep-14 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 407,619 | $ | 192,683 | $ | 214,936 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 839,262 | - | 837,268 | 1,994 | |||||||||||||||||
Corporate debt securities | 2,338,555 | - | 2,338,555 | - | |||||||||||||||||
Asset-backed securities | 342,249 | - | 342,249 | - | |||||||||||||||||
Residential mortgage-backed securities | 330,931 | - | 330,931 | - | |||||||||||||||||
Commercial mortgage-backed securities | 267,500 | - | 267,500 | - | |||||||||||||||||
Collateralized loan obligations | 60,576 | - | 60,576 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 40,287 | 40,287 | - | - | |||||||||||||||||
Total debt securities | 4,626,979 | 232,970 | 4,392,015 | 1,994 | |||||||||||||||||
Equity securities | 3,022 | 2,701 | - | 321 | |||||||||||||||||
Total investments | $ | 4,630,001 | $ | 235,671 | $ | 4,392,015 | $ | 2,315 | |||||||||||||
Real estate acquired (1) | $ | 16,565 | $ | - | $ | - | $ | 16,565 | |||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||||||
Fair Value | Active Markets for | Other Observable | Unobservable | ||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 639,590 | $ | 347,273 | $ | 292,317 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 921,367 | - | 918,944 | 2,423 | |||||||||||||||||
Corporate debt securities | 2,171,415 | - | 2,171,415 | - | |||||||||||||||||
Asset-backed securities | 400,486 | - | 400,486 | - | |||||||||||||||||
Residential mortgage-backed securities | 358,537 | - | 358,537 | - | |||||||||||||||||
Commercial mortgage-backed securities | 271,383 | - | 271,383 | - | |||||||||||||||||
Collateralized loan obligations | 60,295 | - | 60,295 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 40,852 | 40,852 | - | - | |||||||||||||||||
Total debt securities | 4,863,925 | 388,125 | 4,473,377 | 2,423 | |||||||||||||||||
Equity securities | 2,894 | 2,573 | - | 321 | |||||||||||||||||
Total investments | $ | 4,866,819 | $ | 390,698 | $ | 4,473,377 | $ | 2,744 | |||||||||||||
Real estate acquired (1) | $ | 13,280 | $ | - | $ | - | $ | 13,280 | |||||||||||||
-1 | Real estate acquired through claim settlement, which is held for sale, is reported in Other Assets on the consolidated balance sheet. | ||||||||||||||||||||
For assets measured at fair value using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances for the three and nine months ended September 30, 2014 and 2013 is as follows: | |||||||||||||||||||||
Obligations of U.S. | Equity | Total | Real Estate | ||||||||||||||||||
States and Political | Securities | Investments | Acquired | ||||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at June 30, 2014 | $ | 2,231 | $ | 321 | $ | 2,552 | $ | 10,804 | |||||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | (2,062 | ) | ||||||||||||||||
Purchases | - | - | - | 14,107 | |||||||||||||||||
Sales | (237 | ) | - | (237 | ) | (6,284 | ) | ||||||||||||||
Transfers into Level 3 | - | - | - | - | |||||||||||||||||
Transfers out of Level 3 | - | - | - | - | |||||||||||||||||
Balance at September 30, 2014 | $ | 1,994 | $ | 321 | $ | 2,315 | $ | 16,565 | |||||||||||||
Amount of total losses included in earnings for the three months ended September 30, 2014 attributable to the change in unrealized losses on assets still held at September 30, 2014 | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Obligations of U.S. | Equity | Total | Real Estate | ||||||||||||||||||
States and Political | Securities | Investments | Acquired | ||||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2013 | $ | 2,423 | $ | 321 | $ | 2,744 | $ | 13,280 | |||||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | (4,378 | ) | ||||||||||||||||
Purchases | 30 | - | 30 | 33,484 | |||||||||||||||||
Sales | (459 | ) | - | (459 | ) | (25,821 | ) | ||||||||||||||
Transfers into Level 3 | - | - | - | - | |||||||||||||||||
Transfers out of Level 3 | - | - | - | - | |||||||||||||||||
Balance at September 30, 2014 | $ | 1,994 | $ | 321 | $ | 2,315 | $ | 16,565 | |||||||||||||
Amount of total losses included in earnings for the nine months ended September 30, 2014 attributable to the change in unrealized losses on assets still held at September 30, 2014 | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | Securities | Investments | Acquired | |||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at June 30, 2013 | $ | 2,811 | $ | - | $ | 321 | $ | 3,132 | $ | 8,741 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (1,378 | ) | |||||||||||||||
Purchases | - | - | - | - | 10,857 | ||||||||||||||||
Sales | (241 | ) | - | - | (241 | ) | (5,844 | ) | |||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at September 30, 2013 | $ | 2,570 | $ | - | $ | 321 | $ | 2,891 | $ | 12,376 | |||||||||||
Amount of total losses included in earnings for the three months ended September 30, 2013 attributable to the change in unrealized losses on assets still held at September 30, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | Securities | Investments | Acquired | |||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2012 | $ | 3,130 | $ | 17,114 | $ | 321 | $ | 20,565 | $ | 3,463 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as realized investment gains (losses), net | - | (225 | ) | - | (225 | ) | - | ||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (3,680 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 28,401 | ||||||||||||||||
Sales | (590 | ) | (16,889 | ) | - | (17,479 | ) | (15,808 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at September 30, 2013 | $ | 2,570 | $ | - | $ | 321 | $ | 2,891 | $ | 12,376 | |||||||||||
Amount of total losses included in earnings for the nine months ended September 30, 2013 attributable to the change in unrealized losses on assets still held at September 30, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Authoritative guidance over disclosures about the fair value of financial instruments requires additional disclosure for financial instruments not measured at fair value. Certain financial instruments, including insurance contracts, are excluded from these fair value disclosure requirements. The carrying values of cash and cash equivalents (Level 1) and accrued investment income (Level 2) approximated their fair values. | |||||||||||||||||||||
Additional fair value disclosures related to our investment portfolio are included in Note 7 – “Investments.” Fair value disclosures related to our debt are included in Note 3 – “Debt.” |
Other_Comprehensive_Income
Other Comprehensive Income | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Other Comprehensive Income [Abstract] | ' | ||||||||||||||||
Other Comprehensive Income | ' | ||||||||||||||||
Note 9 – Other Comprehensive Income | |||||||||||||||||
Our other comprehensive income for the three and nine months ended September 30, 2014 and 2013 was as follows: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | (17,377 | ) | $ | 6,069 | $ | (5,993 | ) | $ | (17,301 | ) | ||||||
Benefit plan adjustments | (1,732 | ) | 606 | (606 | ) | (1,732 | ) | ||||||||||
Unrealized foreign currency translation adjustment | (3,835 | ) | 1,345 | - | (2,490 | ) | |||||||||||
Other comprehensive income (loss) | $ | (22,944 | ) | $ | 8,020 | $ | (6,599 | ) | $ | (21,523 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | 67,102 | $ | (23,436 | ) | $ | 23,132 | $ | 66,798 | ||||||||
Benefit plan adjustments | (5,198 | ) | 1,819 | (1,819 | ) | (5,198 | ) | ||||||||||
Unrealized foreign currency translation adjustment | (1,000 | ) | 350 | - | (650 | ) | |||||||||||
Other comprehensive income (loss) | $ | 60,904 | $ | (21,267 | ) | $ | 21,313 | $ | 60,950 | ||||||||
Three Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | 7,163 | $ | (2,526 | ) | $ | 2,640 | $ | 7,277 | ||||||||
Unrealized foreign currency translation adjustment | 2,901 | (1,016 | ) | - | 1,885 | ||||||||||||
Other comprehensive income (loss) | $ | 10,064 | $ | (3,542 | ) | $ | 2,640 | $ | 9,162 | ||||||||
Nine Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | (102,468 | ) | $ | 35,586 | $ | (33,914 | ) | $ | (100,796 | ) | ||||||
Unrealized foreign currency translation adjustment | (15,868 | ) | 5,557 | - | (10,311 | ) | |||||||||||
Other comprehensive income (loss) | $ | (118,336 | ) | $ | 41,143 | $ | (33,914 | ) | $ | (111,107 | ) | ||||||
See Note 11 – “Income Taxes” for a discussion of the valuation allowance. | |||||||||||||||||
Total accumulated other comprehensive income and changes in accumulated other comprehensive income, including amounts reclassified from other comprehensive income, are included in the table below. | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at June 30, 2014, before tax | $ | (155 | ) | $ | (7,232 | ) | $ | 14,019 | $ | 6,632 | |||||||
Other comprehensive income (loss) before reclassifications | (18,217 | ) | - | (3,835 | ) | (22,052 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (840 | )(1) | 1,732 | -2 | - | 892 | |||||||||||
Net current period other comprehensive income (loss) | (17,377 | ) | (1,732 | ) | (3,835 | ) | (22,944 | ) | |||||||||
Balance at September 30, 2014, before tax | $ | (17,532 | ) | $ | (8,964 | ) | $ | 10,184 | $ | (16,312 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 56,332 | - | (1,000 | ) | 55,332 | ||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (10,770 | )(1) | 5,198 | -2 | - | (5,572 | ) | ||||||||||
Net current period other comprehensive income (loss) | 67,102 | (5,198 | ) | (1,000 | ) | 60,904 | |||||||||||
Balance at September 30, 2014, before tax | (17,532 | ) | (8,964 | ) | 10,184 | (16,312 | ) | ||||||||||
Tax effect (3) | (64,360 | ) | 26,940 | (3,044 | ) | (40,464 | ) | ||||||||||
Balance at September 30, 2014, net of tax | $ | (81,892 | ) | $ | 17,976 | $ | 7,140 | $ | (56,776 | ) | |||||||
Three Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at June 30, 2013, before tax | $ | (68,090 | ) | $ | (71,804 | ) | $ | 13,978 | $ | (125,916 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 4,396 | - | 2,901 | 7,297 | |||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (2,767 | )(1) | - | (2,767 | ) | ||||||||||||
- | |||||||||||||||||
Net current period other comprehensive income (loss) | 7,163 | - | 2,901 | 10,064 | |||||||||||||
Balance at September 30, 2013, before tax | $ | (60,927 | ) | $ | (71,804 | ) | $ | 16,879 | $ | (115,852 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2012, before tax | $ | 41,541 | $ | (71,804 | ) | $ | 32,747 | $ | 2,484 | ||||||||
Other comprehensive income (loss) before reclassifications | (95,588 | ) | - | (15,868 | ) | (111,456 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 6,880 | -1 | - | 6,880 | |||||||||||||
- | |||||||||||||||||
Net current period other comprehensive income (loss) | (102,468 | ) | - | (15,868 | ) | (118,336 | ) | ||||||||||
Balance at September 30, 2013, before tax | (60,927 | ) | (71,804 | ) | 16,879 | (115,852 | ) | ||||||||||
Tax effect (3) | (64,968 | ) | 26,940 | (5,390 | ) | (43,418 | ) | ||||||||||
Balance at September 30, 2013, net of tax | $ | (125,895 | ) | $ | (44,864 | ) | $ | 11,489 | $ | (159,270 | ) | ||||||
-1 | During the three and nine months ended September 30, 2014, net unrealized losses of ($0.8) million and ($10.8) million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. During the three and nine months ended September 30, 2013, net unrealized (losses) gains of ($2.8) million and $6.9 million, respectively were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. | ||||||||||||||||
-2 | During the three and nine months ended September 30, 2014, other comprehensive income related to benefit plans of $1.7 million and $5.2 million, respectively, was reclassified to the Consolidated Statement of Operations and included in Underwriting and other expenses, net. | ||||||||||||||||
-3 | Tax effect does not approximate 35% due to amounts of tax benefits not provided in various periods due to our tax valuation allowance. | ||||||||||||||||
Total accumulated other comprehensive income at December 31, 2013 is included in the table below. | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||
Tax effect (1) | (64,056 | ) | 26,940 | (3,394 | ) | (40,510 | ) | ||||||||||
Balance at December 31, 2013, net of tax | $ | (148,690 | ) | $ | 23,174 | $ | 7,790 | $ | (117,726 | ) | |||||||
(1) Tax effect does not approximate 35% due to amounts of tax benefits not provided in various periods due to our tax valuation allowance. |
Benefit_Plans
Benefit Plans | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Benefit Plans [Abstract] | ' | ||||||||||||||||
Benefit Plans | ' | ||||||||||||||||
Note 10 - Benefit Plans | |||||||||||||||||
The following table provides the components of net periodic benefit cost for the pension, supplemental executive retirement and other postretirement benefit plans: | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 2,142 | $ | 2,835 | $ | 165 | $ | 202 | |||||||||
Interest cost | 3,997 | 3,823 | 164 | 155 | |||||||||||||
Expected return on plan assets | (5,258 | ) | (5,035 | ) | (1,162 | ) | (919 | ) | |||||||||
Recognized net actuarial loss | 271 | 1,536 | (109 | ) | - | ||||||||||||
Amortization of prior service cost | (233 | ) | 125 | (1,663 | ) | (1,663 | ) | ||||||||||
Net periodic benefit cost | $ | 919 | $ | 3,284 | $ | (2,605 | ) | $ | (2,225 | ) | |||||||
Nine Months Ended September 30, | |||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 6,425 | $ | 8,504 | $ | 494 | $ | 609 | |||||||||
Interest cost | 11,991 | 11,467 | 491 | 464 | |||||||||||||
Expected return on plan assets | (15,773 | ) | (15,108 | ) | (3,486 | ) | (2,759 | ) | |||||||||
Recognized net actuarial loss | 812 | 4,609 | (326 | ) | - | ||||||||||||
Amortization of prior service cost | (698 | ) | 377 | (4,988 | ) | (4,987 | ) | ||||||||||
Net periodic benefit cost | $ | 2,757 | $ | 9,849 | $ | (7,815 | ) | $ | (6,673 | ) | |||||||
We currently intend to make a contribution to our Pension plan in the fourth quarter of 2014 that will approximate our annual service cost for the plan. |
Income_Taxes
Income Taxes | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||||||
Income Taxes | ' | ||||||||||||||||
Note 11 – Income Taxes | |||||||||||||||||
We review the need to maintain a deferred tax asset valuation allowance on a quarterly basis. We analyze several factors, among which are the severity and frequency of operating losses, our capacity for the carryback or carryforward of any losses, the existence and current level of taxable operating income, the expected occurrence of future income or loss and available tax planning alternatives. Based on our analysis and the level of cumulative operating losses, we continue to reduce our benefit from income tax through the recognition of a valuation allowance. | |||||||||||||||||
It is reasonably possible that the amount of the valuation allowance will be reversed in the foreseeable future when we show positive evidence, such as meaningful levels of sustainable operating income, that our deferred tax assets are realizable. In the period in which the valuation allowance is reversed, we would recognize a tax benefit which will increase our earnings for that period. In future years, after the valuation allowance has been reversed and until such time as our net operating loss carryforwards are exhausted or expired, our provision for income tax would substantially exceed the amount of cash tax payments. | |||||||||||||||||
The effect of the change in valuation allowance on the provision for (benefit from) income taxes was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Tax provision (benefit) before valuation allowance | $ | 25,030 | $ | (674 | ) | $ | 65,322 | $ | (17,792 | ) | |||||||
Change in valuation allowance | (24,781 | ) | 1,010 | (63,229 | ) | 20,257 | |||||||||||
Provision for income taxes | $ | 249 | $ | 336 | $ | 2,093 | $ | 2,465 | |||||||||
The change in the valuation allowance that was included in other comprehensive income for the three months ended September 30, 2014 and 2013 was an increase of $6.6 million and a decrease of $2.6 million, respectively. The change in the valuation allowance that was included in other comprehensive income for the nine months ended September 30, 2014 and 2013 was a decrease of $21.3 million and an increase of $33.9 million, respectively. The total valuation allowance as of September 30, 2014 and December 31, 2013 was $919.7 million and $1,004.2 million, respectively. | |||||||||||||||||
We have approximately $2.5 billion of net operating loss carryforwards on a regular tax basis and $1.6 billion of net operating loss carryforwards for computing the alternative minimum tax as of September 30, 2014. Any unutilized carryforwards are scheduled to expire at the end of tax years 2029 through 2033. | |||||||||||||||||
Tax Contingencies | |||||||||||||||||
As previously disclosed, the Internal Revenue Service (“IRS”) completed examinations of our federal income tax returns for the years 2000 through 2007 and issued proposed assessments for taxes, interest and penalties related to our treatment of the flow-through income and loss from an investment in a portfolio of residual interests of Real Estate Mortgage Investment Conduits (“REMICs”). The IRS indicated that it did not believe that, for various reasons, we had established sufficient tax basis in the REMIC residual interests to deduct the losses from taxable income. We appealed these assessments within the IRS and in August 2010, we reached a tentative settlement agreement with the IRS which was not finalized. On September 10, 2014, we received Notices of Deficiency (commonly referred to as “90 day letters”) covering the 2000-2007 tax years. The Notices of Deficiency reflect taxes and penalties related to the REMIC matters of $197.5 million and at September 30, 2014, there would also be interest related to these matters of approximately $164.8 million. In 2007, we made a payment of $65.2 million to the United States Department of the Treasury which will reduce any amounts we would ultimately owe. Depending on the outcome of this matter, additional state income taxes and state interest may become due when a final resolution is reached. As of September 30, 2014, those state taxes and interest would approximate $47.0 million. In addition, there could also be state tax penalties. The Notices of Deficiency also reflected additional amounts due of $261.4 million which are primarily associated with the disallowance of the carryback of the 2009 net operating loss to the 2004-2007 tax years. We believe the IRS included the carryback adjustments as a precaution to keep open the statute of limitations on collection of the tax that was refunded when this loss was carried back, and not because the IRS actually intends to disallow the carryback permanently. | |||||||||||||||||
We intend to petition the U.S. Tax Court to litigate the deficiency amounts and have until December 8, 2014 to do so. Any resulting litigation could be lengthy and costly in terms of legal fees and related expenses. We can provide no assurance regarding the outcome of any such litigation or whether a compromised settlement with the IRS will ultimately be reached and finalized. Our total amount of unrecognized tax benefits as of September 30, 2014 is $106.0 million, which represents the tax benefits generated by the REMIC portfolio included in our tax returns that we have not taken benefit for in our financial statements, including any related interest. We continue to believe that our previously recorded tax provisions and liabilities are appropriate. However, we would need to make appropriate adjustments, which could be material, to our tax provision and liabilities if our view of the probability of success in this matter changes, and the ultimate resolution of this matter could have a material negative impact on our effective tax rate, results of operations, cash flows, available assets and statutory capital. In this regard, see Note 1 – “Nature of Business – Capital-GSEs.” | |||||||||||||||||
In October 2014, we received a Revenue Agent’s Report from the IRS related to the examination of our federal income tax returns for the years 2011 and 2012. The results of the examination had no material effect on the financial statements. | |||||||||||||||||
The total amount of the unrecognized tax benefits, related to our aforementioned REMIC issue, that would affect our effective tax rate is $93.4 million, after taking into account the effect of NOL carrybacks. We recognize interest accrued and penalties related to unrecognized tax benefits in income taxes. As of September 30, 2014 and December 31, 2013, we had accrued $26.7 million and $26.1 million, respectively, for the payment of interest. |
Loss_Reserves
Loss Reserves | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
Loss Reserves [Abstract] | ' | ||||||||||||||||||||||||
Loss Reserves | ' | ||||||||||||||||||||||||
Note 12 – Loss Reserves | |||||||||||||||||||||||||
We establish reserves to recognize the estimated liability for losses and loss adjustment expenses (“LAE”) related to defaults on insured mortgage loans. Loss reserves are established by estimating the number of loans in our inventory of delinquent loans that will result in a claim payment, which is referred to as the claim rate, and further estimating the amount of the claim payment, which is referred to as claim severity. | |||||||||||||||||||||||||
Estimation of losses is inherently judgmental. The conditions that affect the claim rate and claim severity include the current and future state of the domestic economy, including unemployment, and the current and future strength of local housing markets. Current conditions in the housing and mortgage industries make these assumptions more volatile than they would otherwise be. The actual amount of the claim payments may be substantially different than our loss reserve estimates. Our estimates could be adversely affected by several factors, including a deterioration of regional or national economic conditions, including unemployment, leading to a reduction in borrowers’ income and thus their ability to make mortgage payments, and a drop in housing values, may affect borrower willingness to continue to make mortgage payments when the value of the home is below the mortgage balance. Changes to our estimates could result in a material impact to our results of operations and capital position, even in a stable economic environment. | |||||||||||||||||||||||||
The following table provides a reconciliation of beginning and ending loss reserves for the nine months ended September 30, 2014 and 2013: | |||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Reserve at beginning of period | $ | 3,061,401 | $ | 4,056,843 | |||||||||||||||||||||
Less reinsurance recoverable | 64,085 | 104,848 | |||||||||||||||||||||||
Net reserve at beginning of period | 2,997,316 | 3,951,995 | |||||||||||||||||||||||
Losses incurred: | |||||||||||||||||||||||||
Losses and LAE incurred in respect of default notices related to: | |||||||||||||||||||||||||
Current year | 454,390 | 686,454 | |||||||||||||||||||||||
Prior years (1) | (75,387 | ) | (43,783 | ) | |||||||||||||||||||||
Subtotal | 379,003 | 642,671 | |||||||||||||||||||||||
Losses paid: | |||||||||||||||||||||||||
Losses and LAE paid in respect of default notices related to: | |||||||||||||||||||||||||
Current year | 11,574 | 28,792 | |||||||||||||||||||||||
Prior years | 895,061 | 1,286,833 | |||||||||||||||||||||||
Reinsurance terminations (2) | - | (3,332 | ) | ||||||||||||||||||||||
Subtotal | 906,635 | 1,312,293 | |||||||||||||||||||||||
Net reserve at end of period | 2,469,684 | 3,282,373 | |||||||||||||||||||||||
Plus reinsurance recoverables | 57,898 | 70,621 | |||||||||||||||||||||||
Reserve at end of period | $ | 2,527,582 | $ | 3,352,994 | |||||||||||||||||||||
-1 | A negative number for prior year losses incurred indicates a redundancy of prior year loss reserves and a positive number for prior year losses incurred indicates a deficiency of prior year loss reserves. | ||||||||||||||||||||||||
-2 | In a termination, the reinsurance agreement is cancelled, with no future premium ceded and funds for any incurred but unpaid losses transferred to us. The transferred funds result in an increase in our investment portfolio (including cash and cash equivalents) and a decrease in net losses paid (reduction to losses incurred). In addition, there is an offsetting decrease in the reinsurance recoverable (increase in losses incurred), and thus there is no net impact to losses incurred. | ||||||||||||||||||||||||
The “Losses incurred” section of the table above shows losses incurred on default notices received in the current year and in prior years. The amount of losses incurred relating to default notices received in the current year represents the estimated amount to be ultimately paid on such default notices. The amount of losses incurred relating to default notices received in prior years represents the actual claim rate and severity associated with those defaults notices resolved in the current year differing from the estimated liability at the prior year-end, as well as a re-estimation of amounts to be ultimately paid on defaults remaining in inventory from the end of the prior year. This re-estimation of the estimated claim rate and estimated severity is the result of our review of current trends in the default inventory, such as percentages of defaults that have resulted in a claim, the amount of the claims, changes in the relative level of defaults by geography and changes in average loan exposure. | |||||||||||||||||||||||||
Losses incurred on default notices received in the current year decreased in the first nine months of 2014 compared to the same period in 2013, primarily due to a decrease in the number of new default notices received, net of cures, as well as a decrease in the estimated claim rate on new and previously received delinquencies. | |||||||||||||||||||||||||
The prior year development of the reserves in the first nine months of 2014 and 2013 is reflected in the table below. | |||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Prior year loss development (1): | |||||||||||||||||||||||||
(Decrease) increase in estimated claim rate on primary defaults | $ | (38 | ) | $ | 10 | ||||||||||||||||||||
Decrease in estimated severity on primary defaults | (20 | ) | (40 | ) | |||||||||||||||||||||
Change in estimates related to pool reserves, LAE reserves and reinsurance | (17 | ) | (14 | ) | |||||||||||||||||||||
Total prior year loss development | $ | (75 | ) | $ | (44 | ) | |||||||||||||||||||
-1 | A negative number for prior year loss development indicates a redundancy of prior year loss reserves, and a positive number indicates a deficiency of prior year loss reserves. | ||||||||||||||||||||||||
The prior year loss development was based on the resolution of approximately 50% and 48% for the nine months ended September 30, 2014 and 2013, respectively, of the prior year default inventory, as well as a re-estimation of amounts to be ultimately paid on defaults remaining in inventory from the end of the prior year and estimated incurred but not reported items from the end of the prior year. In the first nine months of 2014, we recognized favorable development on our estimated claim rate as we experienced a better cure rate on previously received delinquencies. The favorable development related to our estimated severity primarily relates to items resolved in the first nine months of 2014. In the first nine months of 2013, we recognized favorable development in our estimated severity primarily related to items resolved in the first nine months of 2013. | |||||||||||||||||||||||||
The “Losses paid” section of the table above shows the breakdown between claims paid on default notices received in the current year, claims paid on default notices received in prior years and the decrease in losses paid related to terminated reinsurance agreements as noted in footnote (2) of that table. Until a few years ago, it took, on average, approximately twelve months for a default that is not cured to develop into a paid claim. Over the past several years, the average time it takes to receive a claim associated with a default has increased. This is, in part, due to new loss mitigation protocols established by servicers and to changes in some state foreclosure laws that may include, for example, a requirement for additional review and/or mediation processes. It is difficult to estimate how long it may take for current and future defaults that do not cure to develop into paid claims. | |||||||||||||||||||||||||
The liability associated with our estimate of premiums to be refunded on expected claim payments is accrued for separately at September 30, 2014 and December 31, 2013 and approximated $112 million and $131 million, respectively. Separate components of this liability are included in “Other liabilities” and “Premium deficiency reserve” on our consolidated balance sheet. Changes in the liability affect premiums written and earned and change in premium deficiency reserve. | |||||||||||||||||||||||||
A rollforward of our primary default inventory for the three and nine months ended September 30, 2014 and 2013 appears in the table below. The information concerning new notices and cures is compiled from monthly reports received from loan servicers. The level of new notice and cure activity reported in a particular month can be influenced by, among other things, the date on which a servicer generates its report, the number of business days in a month and transfers of servicing between loan servicers. Historically, losses incurred have followed a seasonal trend in which the second half of the year has weaker credit performance than the first half, with higher new notice activity and a lower cure rate. | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Default inventory at beginning of period | 85,416 | 117,105 | 103,328 | 139,845 | |||||||||||||||||||||
New Notices | 22,927 | 27,755 | 67,451 | 81,044 | |||||||||||||||||||||
Cures | (19,582 | ) | (24,105 | ) | (68,082 | ) | (80,677 | ) | |||||||||||||||||
Paids (including those charged to a deductible or captive) | (5,288 | ) | (8,659 | ) | (18,420 | ) | (27,155 | ) | |||||||||||||||||
Rescissions and denials | (319 | ) | (509 | ) | (1,123 | ) | (1,470 | ) | |||||||||||||||||
Default inventory at end of period | 83,154 | 111,587 | 83,154 | 111,587 | |||||||||||||||||||||
Pool insurance notice inventory decreased from 6,821 at September 30, 2013 to 6,563 at December 31, 2013 and to 4,525 at September 30, 2014. | |||||||||||||||||||||||||
The decrease in the primary default inventory experienced during 2014 and 2013 was generally across all markets and all book years. Historically as a default ages it becomes more likely to result in a claim. The percentage of loans that have been in default for 12 or more consecutive months and the number of loans in our primary claims received inventory have been affected by our suspended rescissions and the resolution of certain of those rescissions discussed below and in Note 5 – “Litigation and Contingencies.” | |||||||||||||||||||||||||
Aging of the Primary Default Inventory | |||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||
Consecutive months in default | |||||||||||||||||||||||||
3 months or less | 16,209 | 19 | % | 18,941 | 18 | % | 20,144 | 18 | % | ||||||||||||||||
4 - 11 months | 18,890 | 23 | % | 24,514 | 24 | % | 24,138 | 22 | % | ||||||||||||||||
12 months or more | 48,055 | 58 | % | 59,873 | 58 | % | 67,305 | 60 | % | ||||||||||||||||
Total primary default inventory | 83,154 | 100 | % | 103,328 | 100 | % | 111,587 | 100 | % | ||||||||||||||||
Primary claims received inventory included in ending default inventory (1) | 5,194 | 6 | % | 6,948 | 7 | % | 9,858 | 9 | % | ||||||||||||||||
(1) Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to certain loans that we believed would be included in a potential resolution. As of September 30, 2014, rescissions of coverage on approximately 1,575 loans had been voluntarily suspended. | |||||||||||||||||||||||||
The number of months a loan is in the default inventory can differ from the number of payments that the borrower has not made or is considered delinquent. These differences typically result from a borrower making monthly payments that do not result in the loan becoming fully current. The number of payments that a borrower is delinquent is shown in the table below. | |||||||||||||||||||||||||
Number of Payments Delinquent | |||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||
3 payments or less | 23,769 | 28 | % | 28,095 | 27 | % | 28,777 | 26 | % | ||||||||||||||||
4 - 11 payments | 18,985 | 23 | % | 24,605 | 24 | % | 25,089 | 22 | % | ||||||||||||||||
12 payments or more | 40,400 | 49 | % | 50,628 | 49 | % | 57,721 | 52 | % | ||||||||||||||||
Total primary default inventory | 83,154 | 100 | % | 103,328 | 100 | % | 111,587 | 100 | % | ||||||||||||||||
Claims paying practices | |||||||||||||||||||||||||
We estimate rescissions mitigated our incurred losses by approximately $2.5 billion in 2009 and $0.2 billion in 2010. These figures include the benefit of claims not paid in the period as well as the impact of changes in our estimated expected rescission activity on our loss reserves in the period. In 2012, we estimate that our rescission benefit in loss reserves was reduced by $0.2 billion due to probable rescission settlement agreements. We estimate that other rescissions had no significant impact on our losses incurred in 2011 through the first nine months of 2014. Our loss reserving methodology incorporates our estimates of future rescissions and reversals of rescissions. Historically, reversals of rescissions have been immaterial. A variance between ultimate actual rescission and reversal rates and our estimates, as a result of the outcome of litigation, settlements or other factors, could materially affect our losses. | |||||||||||||||||||||||||
We do not utilize an explicit rescission rate in our reserving methodology, but rather our reserving methodology incorporates the effects rescission activity has had on our historical claim rate and claim severities. Our estimation process does not include a direct correlation between claim rates and severities to projected rescission activity or other economic conditions such as changes in unemployment rates, interest rates or housing values. Our experience is that analysis of that nature would not produce reliable results, as the change in one condition cannot be isolated to determine its sole effect on our ultimate paid losses as our ultimate paid losses are also influenced at the same time by other economic conditions. The estimation of the impact of rescissions on incurred losses must be considered together with the various other factors impacting incurred losses and not in isolation. | |||||||||||||||||||||||||
The liability associated with our estimate of premiums to be refunded on expected future rescissions is accrued for separately. At September 30, 2014 and December 31, 2013 the estimate of this liability totaled $29 million and $15 million, respectively. Separate components of this liability are included in “Other liabilities” and “Premium deficiency reserve” on our consolidated balance sheet. Changes in the liability affect premiums written and earned and change in premium deficiency reserve. | |||||||||||||||||||||||||
For information about discussions and legal proceedings with customers with respect to our claims paying practices, including settlements that we believe are probable, as defined in ASC 450-20, see Note 5 – “Litigation and Contingencies.” |
Premium_Deficiency_Reserve
Premium Deficiency Reserve | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Premium Deficiency Reserve [Abstract] | ' | ||||||||||||||||
Premium Deficiency Reserve | ' | ||||||||||||||||
Note 13 – Premium Deficiency Reserve | |||||||||||||||||
The components of the premium deficiency reserve at September 30, 2014, December 31, 2013 and September 30, 2013 appear in the table below. | |||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||
(In millions) | |||||||||||||||||
Present value of expected future paid losses and expenses, net of expected future premium | $ | (570 | ) | $ | (669 | ) | $ | (709 | ) | ||||||||
Established loss reserves | 541 | 621 | 652 | ||||||||||||||
Net deficiency | $ | (29 | ) | $ | (48 | ) | $ | (57 | ) | ||||||||
The decrease in the premium deficiency reserve for the three and nine months ended September 30, 2014 was $6 million and $19 million, respectively, as shown in the table below, which represents the net result of actual premiums, losses and expenses as well as a net change in assumptions for these periods. The net change in assumptions for the three months ended September 30, 2014 is primarily related to higher estimated ultimate losses. The net change in assumptions for the nine months ended September 30, 2014 is primarily related to higher estimated ultimate premiums. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
30-Sep-14 | |||||||||||||||||
(In millions) | |||||||||||||||||
Premium Deficiency Reserve at beginning of period | $ | (35 | ) | $ | (48 | ) | |||||||||||
Paid claims and loss adjustment expenses | $ | 41 | $ | 132 | |||||||||||||
Decrease in loss reserves | (15 | ) | (81 | ) | |||||||||||||
Premium earned | (17 | ) | (59 | ) | |||||||||||||
Effects of present valuing on future premiums, losses and expenses | 3 | (1 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | 12 | (9 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | (6 | ) | 28 | ||||||||||||||
Premium Deficiency Reserve at end of period | $ | (29 | ) | $ | (29 | ) | |||||||||||
-1 | A (negative) positive number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a (deficiency) redundancy of the prior premium deficiency reserve. | ||||||||||||||||
The decrease in the premium deficiency reserve for the three and nine months ended September 30, 2013 was $4 million and $17 million, respectively, as shown in the table below. The net change in assumptions for both the three months and nine months ended September 30, 2013 is primarily related to higher estimated ultimate premiums. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
30-Sep-13 | |||||||||||||||||
(In millions) | |||||||||||||||||
Premium Deficiency Reserve at beginning of period | $ | (61 | ) | $ | (74 | ) | |||||||||||
Paid claims and loss adjustment expenses | $ | 51 | $ | 172 | |||||||||||||
Decrease in loss reserves | (37 | ) | (114 | ) | |||||||||||||
Premium earned | (24 | ) | (72 | ) | |||||||||||||
Effects of present valuing on future premiums, losses and expenses | - | (2 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | (10 | ) | (16 | ) | |||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | 14 | 33 | |||||||||||||||
Premium Deficiency Reserve at end of period | $ | (57 | ) | $ | (57 | ) | |||||||||||
-1 | A (negative) positive number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a (deficiency) redundancy of the prior premium deficiency reserve. |
Shareholders_Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2014 | |
Shareholders' Equity [Abstract] | ' |
Shareholders' Equity | ' |
Note 14 – Shareholders’ Equity | |
In June 2013, we amended our Articles of Incorporation to increase our authorized common stock from 680 million shares to 1.0 billion shares. | |
In March 2013 we completed the public offering and sale of 135 million shares of our common stock at a price of $5.15 per share. We received net proceeds of approximately $663.3 million, after deducting underwriting discount and offering expenses. The shares of common stock sold were newly issued shares. | |
In March 2013 we also concurrently completed the sale of $500 million principal amount of 2% Convertible Senior Notes due in 2020. For more information, see Note 3 – “Debt.” | |
We have a Shareholders Rights Agreement which was approved by shareholders (the “Agreement”) dated July 25, 2012, as amended through March 11, 2013, that seeks to diminish the risk that our ability to use our net operating losses (“NOLs”) to reduce potential future federal income tax obligations may become substantially limited and to deter certain abusive takeover practices. The benefit of the NOLs would be substantially limited, and the timing of the usage of the NOLs could be substantially delayed, if we were to experience an “ownership change” as defined by Section 382 of the Internal Revenue Code. | |
Under the Agreement each outstanding share of our Common Stock is accompanied by one Right. The Distribution Date occurs on the earlier of ten days after a public announcement that a person has become an Acquiring Person, or ten business days after a person announces or begins a tender offer in which consummation of such offer would result in a person becoming an Acquiring Person. An Acquiring Person is any person that becomes, by itself or together with its affiliates and associates, a beneficial owner of 5% or more of the shares of our Common Stock then outstanding, but excludes, among others, certain exempt and grandfathered persons as defined in the Agreement. The Rights are not exercisable until the Distribution Date. Each Right will initially entitle shareholders to buy one-tenth of one share of our Common Stock at a Purchase Price of $14 per full share (equivalent to $1.40 for each one-tenth share), subject to adjustment. Each exercisable Right (subject to certain limitations) will entitle its holder to purchase, at the Rights’ then-current Purchase Price, a number of our shares of Common Stock (or if after the Shares Acquisition Date, we are acquired in a business combination, common shares of the acquiror) having a market value at the time equal to twice the Purchase Price. The Rights will expire on August 1, 2015, or earlier as described in the Agreement. The Rights are redeemable at a price of $0.001 per Right at any time prior to the time a person becomes an Acquiring Person. Other than certain amendments, the Board of Directors may amend the Rights in any respect without the consent of the holders of the Rights. |
Statutory_Capital
Statutory Capital | 9 Months Ended |
Sep. 30, 2014 | |
Statutory Capital [Abstract] | ' |
Statutory Capital | ' |
Note 15 – Statutory Capital | |
Statutory Capital Requirements | |
The insurance laws of 16 jurisdictions, including Wisconsin, our domiciliary state, require a mortgage insurer to maintain a minimum amount of statutory capital relative to the risk in force (or a similar measure) in order for the mortgage insurer to continue to write new business. We refer to these requirements as the “State Capital Requirements” and, together with the GSE Financial Requirements, the “Financial Requirements.” While they vary among jurisdictions, the most common State Capital Requirements allow for a maximum risk-to-capital ratio of 25 to 1. A risk-to-capital ratio will increase if (i) the percentage decrease in capital exceeds the percentage decrease in insured risk, or (ii) the percentage increase in capital is less than the percentage increase in insured risk. Wisconsin does not regulate capital by using a risk-to-capital measure but instead requires a minimum policyholder position (“MPP”). The “policyholder position” of a mortgage insurer is its net worth or surplus, contingency reserve and a portion of the reserves for unearned premiums. | |
In 2013, we entered into a quota share reinsurance transaction with a group of unaffiliated reinsurers that reduced our risk-to-capital ratio. At September 30, 2014, MGIC’s risk-to-capital ratio was 15.0 to 1, below the maximum allowed by the jurisdictions with State Capital Requirements, and its policyholder position was $605 million above the required MPP of $1.0 billion. It is possible that under the revised State Capital Requirements discussed below, MGIC will not be allowed full credit for the risk ceded to the reinsurers. If MGIC is disallowed full credit under either the State Capital Requirements or the GSE Financial Requirements, MGIC may terminate the transaction, without penalty. At this time, we expect MGIC to continue to comply with the current State Capital Requirements. Matters that could negatively affect compliance with State Capital Requirements are discussed throughout the financial statement footnotes. | |
At September 30, 2014, the risk-to-capital ratio of our combined insurance operations (which includes reinsurance affiliates) was 17.0 to 1. Reinsurance transactions with affiliates permit MGIC to write insurance with a higher coverage percentage than it could on its own under certain state-specific requirements. A higher risk-to-capital ratio on a combined basis may indicate that, in order for MGIC to continue to utilize reinsurance arrangements with its affiliates, unless a waiver of the State Capital Requirements of Wisconsin continues to be effective, additional capital contributions to the reinsurance affiliates could be needed. | |
The National Association of Insurance Commissioners (“NAIC”) previously announced that it plans to revise the minimum capital and surplus requirements for mortgage insurers that are provided for in its Mortgage Guaranty Insurance Model Act. A working group of state regulators is considering this issue, although no date has been established by which the NAIC must propose revisions to such requirements. Depending on the scope of revisions made by the NAIC, MGIC may be prevented from writing new business in the jurisdictions adopting such revisions. | |
If MGIC fails to meet the State Capital Requirements of Wisconsin and is unable to obtain a waiver of them from the Office of the Commissioner of Insurance of the State of Wisconsin (“OCI”), MGIC could be prevented from writing new business in all jurisdictions. If MGIC fails to meet the State Capital Requirements of a jurisdiction other than Wisconsin and is unable to obtain a waiver of them, MGIC could be prevented from writing new business in that particular jurisdiction. It is possible that regulatory action by one or more jurisdictions, including those that do not have specific State Capital Requirements, may prevent MGIC from continuing to write new insurance in such jurisdictions. If we are unable to write business in all jurisdictions, lenders may be unwilling to procure insurance from us anywhere. In addition, a lender’s assessment of the future ability of our insurance operations to meet the Financial Requirements may affect its willingness to procure insurance from us. A possible future failure by MGIC to meet the Financial Requirements will not necessarily mean that MGIC lacks sufficient resources to pay claims on its insurance liabilities. Matters that could negatively affect MGIC’s claims paying resources are discussed throughout the financial statement footnotes. | |
We have in place a longstanding plan to write new business in MIC, a direct subsidiary of MGIC, in the event MGIC cannot meet the State Capital Requirements of a jurisdiction or obtain a waiver of them. Writing business in MIC would be subject to any repatriation to MGIC of MIC’s capital in order to comply with the PMIERs, as discussed in Note 1 – “Nature of Business and Basis of Presentation – Capital – GSEs.” MIC is licensed to write business in all jurisdictions. During 2012, MIC began writing new business in the jurisdictions where MGIC did not meet and did not have a waiver of the State Capital Requirements. MIC suspended writing new business in 2013 because MGIC again meets the State Capital Requirements and is writing new business in all jurisdictions. As of September 30, 2014, MIC had statutory capital of $466 million and risk in force, net of reinsurance, of approximately $547 million and met all State Capital Requirements. Before MIC may again write new business, it must obtain the necessary approvals from the OCI and the GSEs. We cannot assure you that the OCI and the GSEs would again approve MIC to write new business in all jurisdictions if in the future MGIC became unable to do so. | |
Statement of Statutory Accounting Principles No. 101 (“SSAP No. 101”) became effective January 1, 2012 and prescribed new standards for determining the amount of deferred tax assets that can be recognized as admitted assets for determining statutory capital. Under a permitted practice effective September 30, 2012 and until further notice, the OCI has approved MGIC to report its net deferred tax asset as an admitted asset in an amount not to exceed 10% of surplus as regards policyholders, notwithstanding any contrary provisions of SSAP No. 101. Deferred tax assets of $134 million and $138 million were included in MGIC’s statutory capital at September 30, 2014 and December 31, 2013, respectively. | |
See Note 1 – “Nature of Business and Basis of Presentation – Capital – GSEs” for additional information regarding the capital standards of the GSEs. |
Debt_Tables
Debt (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Debt [Abstract] | ' | ||||||||||||||||||||
Par value and fair value of debt | ' | ||||||||||||||||||||
The par value and fair value of our debt at September 30, 2014 and December 31, 2013 appears in the table below. | |||||||||||||||||||||
Significant | |||||||||||||||||||||
Quoted Prices in | Other | Significant | |||||||||||||||||||
Active Markets | Observable | Unobservable | |||||||||||||||||||
Total Fair | for Identical | Inputs | Inputs | ||||||||||||||||||
Par Value | Value | Assets (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
30-Sep-14 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||
Senior Notes | $ | 61,953 | $ | 63,696 | $ | - | $ | 63,696 | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 374,498 | 374,498 | - | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 656,250 | 656,250 | - | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 497,371 | - | 497,371 | - | ||||||||||||||||
Total Debt | $ | 1,296,475 | $ | 1,591,815 | $ | 1,030,748 | $ | 561,067 | $ | - | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Liabilities: | |||||||||||||||||||||
Senior Notes | $ | 82,883 | $ | 85,991 | $ | 85,991 | $ | - | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 388,988 | 388,988 | - | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 685,625 | 685,625 | - | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 439,186 | - | 439,186 | - | ||||||||||||||||
Total Debt | $ | 1,317,405 | $ | 1,599,790 | $ | 1,160,604 | $ | 439,186 | $ | - |
Reinsurance_Tables
Reinsurance (Tables) | 9 Months Ended | ||||||||
Sep. 30, 2014 | |||||||||
Reinsurance [Abstract] | ' | ||||||||
Effect of Reinsurance Agreement | ' | ||||||||
A summary of the effect of our reinsurance agreements on our results for the nine months ended September 30, 2014 and 2013 appears below. | |||||||||
Nine Months Ended | |||||||||
September 30, | |||||||||
2014 | 2013 | ||||||||
(In thousands) | |||||||||
Ceded premiums written, net of profit commission | $ | 87,450 | $ | 31,473 | |||||
Ceded premiums earned, net of profit commission | 79,460 | 23,499 | |||||||
Ceded losses incurred | 22,451 | 21,238 | |||||||
Ceding commissions | 28,994 | 4,646 |
Earnings_Loss_per_Share_Tables
Earnings (Loss) per Share (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Earnings (Loss) per Share [Abstract] | ' | ||||||||||||||||
Calculation of earnings (loss) per share | ' | ||||||||||||||||
The following includes a reconciliation of the weighted average number of shares; however for the three months ended September 30, 2014 and 2013 common stock equivalents of 54.5 million and 126.5 million, respectively, and for the nine months ended September 30, 2014 and 2013 common stock equivalents of 54.5 million and 109.6 million, respectively, were not included because they were anti-dilutive. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands, except per share data) | |||||||||||||||||
Basic earnings per share: | |||||||||||||||||
Net income (loss) | $ | 72,017 | $ | 12,114 | $ | 177,521 | $ | (48,441 | ) | ||||||||
Weighted average common shares outstanding | 338,626 | 337,868 | 338,488 | 302,996 | |||||||||||||
Basic income (loss) per share | $ | 0.21 | $ | 0.04 | $ | 0.52 | $ | (0.16 | ) | ||||||||
Diluted earnings per share: | |||||||||||||||||
Net income (loss) | $ | 72,017 | $ | 12,114 | $ | 177,521 | $ | (48,441 | ) | ||||||||
Effect of dilutive securities: | |||||||||||||||||
2% Convertible Senior Notes | 3,049 | - | 9,148 | - | |||||||||||||
Net income (loss) plus assumed conversions | $ | 75,066 | $ | 12,114 | $ | 186,669 | $ | (48,441 | ) | ||||||||
Weighted-average shares - Basic | 338,626 | 337,868 | 338,488 | 302,996 | |||||||||||||
Common stock equivalents | 74,950 | 1,558 | 74,985 | - | |||||||||||||
Weighted-average shares - Diluted | 413,576 | 339,426 | 413,473 | 302,996 | |||||||||||||
Diluted income (loss) per share | $ | 0.18 | $ | 0.04 | $ | 0.45 | $ | (0.16 | ) |
Investments_Tables
Investments (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
Investments [Abstract] | ' | ||||||||||||||||||||||||
Amortized cost, gross unrealized gains and losses and fair value of investments portfolio | ' | ||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at September 30, 2014 and December 31, 2013 are shown below. | |||||||||||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||
30-Sep-14 | Cost | Gains | Losses (1) | Value | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 414,778 | $ | 2,636 | $ | (9,795 | ) | $ | 407,619 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 833,510 | 10,068 | (4,316 | ) | 839,262 | ||||||||||||||||||||
Corporate debt securities | 2,341,189 | 9,953 | (12,587 | ) | 2,338,555 | ||||||||||||||||||||
Asset-backed securities | 341,519 | 932 | (202 | ) | 342,249 | ||||||||||||||||||||
Residential mortgage-backed securities | 344,515 | 167 | (13,751 | ) | 330,931 | ||||||||||||||||||||
Commercial mortgage-backed securities | 269,857 | 675 | (3,032 | ) | 267,500 | ||||||||||||||||||||
Collateralized loan obligations | 61,339 | - | (763 | ) | 60,576 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 37,854 | 2,466 | (33 | ) | 40,287 | ||||||||||||||||||||
Total debt securities | 4,644,561 | 26,897 | (44,479 | ) | 4,626,979 | ||||||||||||||||||||
Equity securities | 2,968 | 63 | (9 | ) | 3,022 | ||||||||||||||||||||
Total investment portfolio | $ | 4,647,529 | $ | 26,960 | $ | (44,488 | ) | $ | 4,630,001 | ||||||||||||||||
Gross | Gross | ||||||||||||||||||||||||
Amortized | Unrealized | Unrealized | Fair | ||||||||||||||||||||||
31-Dec-13 | Cost | Gains | Losses (1) | Value | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 663,642 | $ | 1,469 | $ | (25,521 | ) | $ | 639,590 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 932,922 | 5,865 | (17,420 | ) | 921,367 | ||||||||||||||||||||
Corporate debt securities | 2,190,095 | 6,313 | (24,993 | ) | 2,171,415 | ||||||||||||||||||||
Asset-backed securities | 399,839 | 1,100 | (453 | ) | 400,486 | ||||||||||||||||||||
Residential mortgage-backed securities | 383,368 | 146 | (24,977 | ) | 358,537 | ||||||||||||||||||||
Commercial mortgage-backed securities | 277,920 | 131 | (6,668 | ) | 271,383 | ||||||||||||||||||||
Collateralized loan obligations | 61,337 | - | (1,042 | ) | 60,295 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 39,420 | 1,722 | (290 | ) | 40,852 | ||||||||||||||||||||
Total debt securities | 4,948,543 | 16,746 | (101,364 | ) | 4,863,925 | ||||||||||||||||||||
Equity securities | 2,908 | 9 | (23 | ) | 2,894 | ||||||||||||||||||||
Total investment portfolio | $ | 4,951,451 | $ | 16,755 | $ | (101,387 | ) | $ | 4,866,819 | ||||||||||||||||
(1) At September 30, 2014 and December 31, 2013, there were no other-than-temporary impairment losses recorded in other comprehensive income. | |||||||||||||||||||||||||
Amortized cost and fair values of debt securities by contractual maturity | ' | ||||||||||||||||||||||||
The amortized cost and fair values of debt securities at September 30, 2014, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Because most asset-backed and mortgage-backed securities and collateralized loan obligations provide for periodic payments throughout their lives, they are listed below in separate categories. | |||||||||||||||||||||||||
Amortized | Fair | ||||||||||||||||||||||||
30-Sep-14 | Cost | Value | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Due in one year or less | $ | 405,324 | $ | 406,256 | |||||||||||||||||||||
Due after one year through five years | 1,858,612 | 1,863,872 | |||||||||||||||||||||||
Due after five years through ten years | 928,153 | 922,372 | |||||||||||||||||||||||
Due after ten years | 435,242 | 433,223 | |||||||||||||||||||||||
$ | 3,627,331 | $ | 3,625,723 | ||||||||||||||||||||||
Asset-backed securities | 341,519 | 342,249 | |||||||||||||||||||||||
Residential mortgage-backed securities | 344,515 | 330,931 | |||||||||||||||||||||||
Commercial mortgage-backed securities | 269,857 | 267,500 | |||||||||||||||||||||||
Collateralized loan obligations | 61,339 | 60,576 | |||||||||||||||||||||||
Total at September 30, 2014 | $ | 4,644,561 | $ | 4,626,979 | |||||||||||||||||||||
Aging of the fair values of securities in an unrealized loss position | ' | ||||||||||||||||||||||||
For those securities in an unrealized loss position, the length of time the securities were in such a position, as measured by their month-end fair values, is as follows: | |||||||||||||||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | ||||||||||||||||||||
30-Sep-14 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 6,320 | $ | 43 | $ | 325,892 | $ | 9,752 | $ | 332,212 | $ | 9,795 | |||||||||||||
Obligations of U.S. states and political subdivisions | 165,975 | 1,392 | 135,146 | 2,924 | 301,121 | 4,316 | |||||||||||||||||||
Corporate debt securities | 1,000,551 | 5,995 | 233,161 | 6,592 | 1,233,712 | 12,587 | |||||||||||||||||||
Asset-backed securities | 56,801 | 137 | 14,675 | 65 | 71,476 | 202 | |||||||||||||||||||
Residential mortgage-backed securities | 15,020 | 55 | 307,151 | 13,696 | 322,171 | 13,751 | |||||||||||||||||||
Commercial mortgage-backed securities | 91,505 | 855 | 112,195 | 2,177 | 203,700 | 3,032 | |||||||||||||||||||
Collateralized loan obligations | - | - | 60,576 | 763 | 60,576 | 763 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | 4,561 | 10 | 1,783 | 23 | 6,344 | 33 | |||||||||||||||||||
Equity securities | 137 | 1 | 238 | 8 | 375 | 9 | |||||||||||||||||||
Total investment portfolio | $ | 1,340,870 | $ | 8,488 | $ | 1,190,817 | $ | 36,000 | $ | 2,531,687 | $ | 44,488 | |||||||||||||
Less Than 12 Months | 12 Months or Greater | Total | |||||||||||||||||||||||
Fair | Unrealized | Fair | Unrealized | Fair | Unrealized | ||||||||||||||||||||
31-Dec-13 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 465,975 | $ | 24,980 | $ | 4,103 | $ | 541 | $ | 470,078 | $ | 25,521 | |||||||||||||
Obligations of U.S. states and political subdivisions | 503,967 | 17,370 | 4,226 | 50 | 508,193 | 17,420 | |||||||||||||||||||
Corporate debt securities | 1,238,211 | 20,371 | 81,593 | 4,622 | 1,319,804 | 24,993 | |||||||||||||||||||
Asset-backed securities | 126,991 | 387 | 7,114 | 66 | 134,105 | 453 | |||||||||||||||||||
Residential mortgage-backed securities | 91,534 | 3,886 | 265,827 | 21,091 | 357,361 | 24,977 | |||||||||||||||||||
Commercial mortgage-backed securities | 192,440 | 6,239 | 43,095 | 429 | 235,535 | 6,668 | |||||||||||||||||||
Collateralized loan obligations | 60,295 | 1,042 | - | - | 60,295 | 1,042 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | 7,203 | 290 | - | - | 7,203 | 290 | |||||||||||||||||||
Equity securities | 1,012 | 18 | 75 | 5 | 1,087 | 23 | |||||||||||||||||||
Total investment portfolio | $ | 2,687,628 | $ | 74,583 | $ | 406,033 | $ | 26,804 | $ | 3,093,661 | $ | 101,387 | |||||||||||||
Net realized investment gains (losses) and OTTI on investments | ' | ||||||||||||||||||||||||
The net realized investment gains (losses) and OTTI on the investment portfolio are as follows: | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) and OTTI on investments: | |||||||||||||||||||||||||
Fixed maturities | $ | 629 | $ | (393 | ) | $ | 755 | $ | 2,755 | ||||||||||||||||
Equity securities | 3 | 254 | 168 | 850 | |||||||||||||||||||||
$ | 632 | $ | (139 | ) | $ | 923 | $ | 3,605 | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) and OTTI on investments: | |||||||||||||||||||||||||
Gains on sales | $ | 1,161 | $ | 391 | $ | 3,273 | $ | 5,352 | |||||||||||||||||
Losses on sales | (529 | ) | (202 | ) | (2,350 | ) | (1,419 | ) | |||||||||||||||||
Impairment losses | - | (328 | ) | - | (328 | ) | |||||||||||||||||||
$ | 632 | $ | (139 | ) | $ | 923 | $ | 3,605 |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | ||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||
Fair Value Measurements [Abstract] | ' | ||||||||||||||||||||
Fair value measurements for items measured at fair value | ' | ||||||||||||||||||||
Fair value measurements for assets measured at fair value included the following as of September 30, 2014 and December 31, 2013: | |||||||||||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||||||
Fair Value | Active Markets for | Other Observable Inputs | Unobservable | ||||||||||||||||||
Identical Assets | (Level 2) | Inputs | |||||||||||||||||||
(Level 1) | (Level 3) | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
30-Sep-14 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 407,619 | $ | 192,683 | $ | 214,936 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 839,262 | - | 837,268 | 1,994 | |||||||||||||||||
Corporate debt securities | 2,338,555 | - | 2,338,555 | - | |||||||||||||||||
Asset-backed securities | 342,249 | - | 342,249 | - | |||||||||||||||||
Residential mortgage-backed securities | 330,931 | - | 330,931 | - | |||||||||||||||||
Commercial mortgage-backed securities | 267,500 | - | 267,500 | - | |||||||||||||||||
Collateralized loan obligations | 60,576 | - | 60,576 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 40,287 | 40,287 | - | - | |||||||||||||||||
Total debt securities | 4,626,979 | 232,970 | 4,392,015 | 1,994 | |||||||||||||||||
Equity securities | 3,022 | 2,701 | - | 321 | |||||||||||||||||
Total investments | $ | 4,630,001 | $ | 235,671 | $ | 4,392,015 | $ | 2,315 | |||||||||||||
Real estate acquired (1) | $ | 16,565 | $ | - | $ | - | $ | 16,565 | |||||||||||||
Quoted Prices in | Significant | Significant | |||||||||||||||||||
Fair Value | Active Markets for | Other Observable | Unobservable | ||||||||||||||||||
Identical Assets | Inputs | Inputs | |||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 639,590 | $ | 347,273 | $ | 292,317 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 921,367 | - | 918,944 | 2,423 | |||||||||||||||||
Corporate debt securities | 2,171,415 | - | 2,171,415 | - | |||||||||||||||||
Asset-backed securities | 400,486 | - | 400,486 | - | |||||||||||||||||
Residential mortgage-backed securities | 358,537 | - | 358,537 | - | |||||||||||||||||
Commercial mortgage-backed securities | 271,383 | - | 271,383 | - | |||||||||||||||||
Collateralized loan obligations | 60,295 | - | 60,295 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 40,852 | 40,852 | - | - | |||||||||||||||||
Total debt securities | 4,863,925 | 388,125 | 4,473,377 | 2,423 | |||||||||||||||||
Equity securities | 2,894 | 2,573 | - | 321 | |||||||||||||||||
Total investments | $ | 4,866,819 | $ | 390,698 | $ | 4,473,377 | $ | 2,744 | |||||||||||||
Real estate acquired (1) | $ | 13,280 | $ | - | $ | - | $ | 13,280 | |||||||||||||
-1 | Real estate acquired through claim settlement, which is held for sale, is reported in Other Assets on the consolidated balance sheet. | ||||||||||||||||||||
Reconciliation of beginning and ending balance for assets and liabilities measured at fair value with significant unobservable inputs (level 3) | ' | ||||||||||||||||||||
For assets measured at fair value using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances for the three and nine months ended September 30, 2014 and 2013 is as follows: | |||||||||||||||||||||
Obligations of U.S. | Equity | Total | Real Estate | ||||||||||||||||||
States and Political | Securities | Investments | Acquired | ||||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at June 30, 2014 | $ | 2,231 | $ | 321 | $ | 2,552 | $ | 10,804 | |||||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | (2,062 | ) | ||||||||||||||||
Purchases | - | - | - | 14,107 | |||||||||||||||||
Sales | (237 | ) | - | (237 | ) | (6,284 | ) | ||||||||||||||
Transfers into Level 3 | - | - | - | - | |||||||||||||||||
Transfers out of Level 3 | - | - | - | - | |||||||||||||||||
Balance at September 30, 2014 | $ | 1,994 | $ | 321 | $ | 2,315 | $ | 16,565 | |||||||||||||
Amount of total losses included in earnings for the three months ended September 30, 2014 attributable to the change in unrealized losses on assets still held at September 30, 2014 | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Obligations of U.S. | Equity | Total | Real Estate | ||||||||||||||||||
States and Political | Securities | Investments | Acquired | ||||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2013 | $ | 2,423 | $ | 321 | $ | 2,744 | $ | 13,280 | |||||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | (4,378 | ) | ||||||||||||||||
Purchases | 30 | - | 30 | 33,484 | |||||||||||||||||
Sales | (459 | ) | - | (459 | ) | (25,821 | ) | ||||||||||||||
Transfers into Level 3 | - | - | - | - | |||||||||||||||||
Transfers out of Level 3 | - | - | - | - | |||||||||||||||||
Balance at September 30, 2014 | $ | 1,994 | $ | 321 | $ | 2,315 | $ | 16,565 | |||||||||||||
Amount of total losses included in earnings for the nine months ended September 30, 2014 attributable to the change in unrealized losses on assets still held at September 30, 2014 | $ | - | $ | - | $ | - | $ | - | |||||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | Securities | Investments | Acquired | |||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at June 30, 2013 | $ | 2,811 | $ | - | $ | 321 | $ | 3,132 | $ | 8,741 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (1,378 | ) | |||||||||||||||
Purchases | - | - | - | - | 10,857 | ||||||||||||||||
Sales | (241 | ) | - | - | (241 | ) | (5,844 | ) | |||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at September 30, 2013 | $ | 2,570 | $ | - | $ | 321 | $ | 2,891 | $ | 12,376 | |||||||||||
Amount of total losses included in earnings for the three months ended September 30, 2013 attributable to the change in unrealized losses on assets still held at September 30, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | Securities | Investments | Acquired | |||||||||||||||||
Subdivisions | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2012 | $ | 3,130 | $ | 17,114 | $ | 321 | $ | 20,565 | $ | 3,463 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as realized investment gains (losses), net | - | (225 | ) | - | (225 | ) | - | ||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (3,680 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 28,401 | ||||||||||||||||
Sales | (590 | ) | (16,889 | ) | - | (17,479 | ) | (15,808 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at September 30, 2013 | $ | 2,570 | $ | - | $ | 321 | $ | 2,891 | $ | 12,376 | |||||||||||
Amount of total losses included in earnings for the nine months ended September 30, 2013 attributable to the change in unrealized losses on assets still held at September 30, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - |
Other_Comprehensive_Income_Tab
Other Comprehensive Income (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Other Comprehensive Income [Abstract] | ' | ||||||||||||||||
Other comprehensive income | ' | ||||||||||||||||
Our other comprehensive income for the three and nine months ended September 30, 2014 and 2013 was as follows: | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | (17,377 | ) | $ | 6,069 | $ | (5,993 | ) | $ | (17,301 | ) | ||||||
Benefit plan adjustments | (1,732 | ) | 606 | (606 | ) | (1,732 | ) | ||||||||||
Unrealized foreign currency translation adjustment | (3,835 | ) | 1,345 | - | (2,490 | ) | |||||||||||
Other comprehensive income (loss) | $ | (22,944 | ) | $ | 8,020 | $ | (6,599 | ) | $ | (21,523 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | 67,102 | $ | (23,436 | ) | $ | 23,132 | $ | 66,798 | ||||||||
Benefit plan adjustments | (5,198 | ) | 1,819 | (1,819 | ) | (5,198 | ) | ||||||||||
Unrealized foreign currency translation adjustment | (1,000 | ) | 350 | - | (650 | ) | |||||||||||
Other comprehensive income (loss) | $ | 60,904 | $ | (21,267 | ) | $ | 21,313 | $ | 60,950 | ||||||||
Three Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | 7,163 | $ | (2,526 | ) | $ | 2,640 | $ | 7,277 | ||||||||
Unrealized foreign currency translation adjustment | 2,901 | (1,016 | ) | - | 1,885 | ||||||||||||
Other comprehensive income (loss) | $ | 10,064 | $ | (3,542 | ) | $ | 2,640 | $ | 9,162 | ||||||||
Nine Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Before tax | Tax effect | Valuation | Net of tax | ||||||||||||||
allowance | |||||||||||||||||
(In thousands) | |||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||
Change in unrealized gains and losses on investments | $ | (102,468 | ) | $ | 35,586 | $ | (33,914 | ) | $ | (100,796 | ) | ||||||
Unrealized foreign currency translation adjustment | (15,868 | ) | 5,557 | - | (10,311 | ) | |||||||||||
Other comprehensive income (loss) | $ | (118,336 | ) | $ | 41,143 | $ | (33,914 | ) | $ | (111,107 | ) | ||||||
Accumulated other comprehensive income (loss) | ' | ||||||||||||||||
Total accumulated other comprehensive income and changes in accumulated other comprehensive income, including amounts reclassified from other comprehensive income, are included in the table below. | |||||||||||||||||
Three Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at June 30, 2014, before tax | $ | (155 | ) | $ | (7,232 | ) | $ | 14,019 | $ | 6,632 | |||||||
Other comprehensive income (loss) before reclassifications | (18,217 | ) | - | (3,835 | ) | (22,052 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (840 | )(1) | 1,732 | -2 | - | 892 | |||||||||||
Net current period other comprehensive income (loss) | (17,377 | ) | (1,732 | ) | (3,835 | ) | (22,944 | ) | |||||||||
Balance at September 30, 2014, before tax | $ | (17,532 | ) | $ | (8,964 | ) | $ | 10,184 | $ | (16,312 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-14 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 56,332 | - | (1,000 | ) | 55,332 | ||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (10,770 | )(1) | 5,198 | -2 | - | (5,572 | ) | ||||||||||
Net current period other comprehensive income (loss) | 67,102 | (5,198 | ) | (1,000 | ) | 60,904 | |||||||||||
Balance at September 30, 2014, before tax | (17,532 | ) | (8,964 | ) | 10,184 | (16,312 | ) | ||||||||||
Tax effect (3) | (64,360 | ) | 26,940 | (3,044 | ) | (40,464 | ) | ||||||||||
Balance at September 30, 2014, net of tax | $ | (81,892 | ) | $ | 17,976 | $ | 7,140 | $ | (56,776 | ) | |||||||
Three Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at June 30, 2013, before tax | $ | (68,090 | ) | $ | (71,804 | ) | $ | 13,978 | $ | (125,916 | ) | ||||||
Other comprehensive income (loss) before reclassifications | 4,396 | - | 2,901 | 7,297 | |||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | (2,767 | )(1) | - | (2,767 | ) | ||||||||||||
- | |||||||||||||||||
Net current period other comprehensive income (loss) | 7,163 | - | 2,901 | 10,064 | |||||||||||||
Balance at September 30, 2013, before tax | $ | (60,927 | ) | $ | (71,804 | ) | $ | 16,879 | $ | (115,852 | ) | ||||||
Nine Months Ended | |||||||||||||||||
30-Sep-13 | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2012, before tax | $ | 41,541 | $ | (71,804 | ) | $ | 32,747 | $ | 2,484 | ||||||||
Other comprehensive income (loss) before reclassifications | (95,588 | ) | - | (15,868 | ) | (111,456 | ) | ||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | 6,880 | -1 | - | 6,880 | |||||||||||||
- | |||||||||||||||||
Net current period other comprehensive income (loss) | (102,468 | ) | - | (15,868 | ) | (118,336 | ) | ||||||||||
Balance at September 30, 2013, before tax | (60,927 | ) | (71,804 | ) | 16,879 | (115,852 | ) | ||||||||||
Tax effect (3) | (64,968 | ) | 26,940 | (5,390 | ) | (43,418 | ) | ||||||||||
Balance at September 30, 2013, net of tax | $ | (125,895 | ) | $ | (44,864 | ) | $ | 11,489 | $ | (159,270 | ) | ||||||
-1 | During the three and nine months ended September 30, 2014, net unrealized losses of ($0.8) million and ($10.8) million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. During the three and nine months ended September 30, 2013, net unrealized (losses) gains of ($2.8) million and $6.9 million, respectively were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. | ||||||||||||||||
-2 | During the three and nine months ended September 30, 2014, other comprehensive income related to benefit plans of $1.7 million and $5.2 million, respectively, was reclassified to the Consolidated Statement of Operations and included in Underwriting and other expenses, net. | ||||||||||||||||
-3 | Tax effect does not approximate 35% due to amounts of tax benefits not provided in various periods due to our tax valuation allowance. | ||||||||||||||||
Total accumulated other comprehensive income at December 31, 2013 is included in the table below. | |||||||||||||||||
Unrealized gains and | Defined benefit | Foreign currency | Total | ||||||||||||||
losses on available- | plans | translation | |||||||||||||||
for-sale securities | |||||||||||||||||
(In thousands) | |||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||
Tax effect (1) | (64,056 | ) | 26,940 | (3,394 | ) | (40,510 | ) | ||||||||||
Balance at December 31, 2013, net of tax | $ | (148,690 | ) | $ | 23,174 | $ | 7,790 | $ | (117,726 | ) | |||||||
(1) Tax effect does not approximate 35% due to amounts of tax benefits not provided in various periods due to our tax valuation allowance. |
Benefit_Plans_Tables
Benefit Plans (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Benefit Plans [Abstract] | ' | ||||||||||||||||
Components of net periodic benefit cost | ' | ||||||||||||||||
The following table provides the components of net periodic benefit cost for the pension, supplemental executive retirement and other postretirement benefit plans: | |||||||||||||||||
Three Months Ended September 30, | |||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 2,142 | $ | 2,835 | $ | 165 | $ | 202 | |||||||||
Interest cost | 3,997 | 3,823 | 164 | 155 | |||||||||||||
Expected return on plan assets | (5,258 | ) | (5,035 | ) | (1,162 | ) | (919 | ) | |||||||||
Recognized net actuarial loss | 271 | 1,536 | (109 | ) | - | ||||||||||||
Amortization of prior service cost | (233 | ) | 125 | (1,663 | ) | (1,663 | ) | ||||||||||
Net periodic benefit cost | $ | 919 | $ | 3,284 | $ | (2,605 | ) | $ | (2,225 | ) | |||||||
Nine Months Ended September 30, | |||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 6,425 | $ | 8,504 | $ | 494 | $ | 609 | |||||||||
Interest cost | 11,991 | 11,467 | 491 | 464 | |||||||||||||
Expected return on plan assets | (15,773 | ) | (15,108 | ) | (3,486 | ) | (2,759 | ) | |||||||||
Recognized net actuarial loss | 812 | 4,609 | (326 | ) | - | ||||||||||||
Amortization of prior service cost | (698 | ) | 377 | (4,988 | ) | (4,987 | ) | ||||||||||
Net periodic benefit cost | $ | 2,757 | $ | 9,849 | $ | (7,815 | ) | $ | (6,673 | ) |
Income_Taxes_Tables
Income Taxes (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Income Taxes [Abstract] | ' | ||||||||||||||||
Tax provision (benefit) | ' | ||||||||||||||||
The effect of the change in valuation allowance on the provision for (benefit from) income taxes was as follows: | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
September 30, | September 30, | ||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||
(In thousands) | |||||||||||||||||
Tax provision (benefit) before valuation allowance | $ | 25,030 | $ | (674 | ) | $ | 65,322 | $ | (17,792 | ) | |||||||
Change in valuation allowance | (24,781 | ) | 1,010 | (63,229 | ) | 20,257 | |||||||||||
Provision for income taxes | $ | 249 | $ | 336 | $ | 2,093 | $ | 2,465 |
Loss_Reserves_Tables
Loss Reserves (Tables) | 9 Months Ended | ||||||||||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||||||||||
Loss Reserves [Abstract] | ' | ||||||||||||||||||||||||
Reconciliation of beginning and ending loss reserves | ' | ||||||||||||||||||||||||
The following table provides a reconciliation of beginning and ending loss reserves for the nine months ended September 30, 2014 and 2013: | |||||||||||||||||||||||||
Nine Months Ended | |||||||||||||||||||||||||
September 30, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Reserve at beginning of period | $ | 3,061,401 | $ | 4,056,843 | |||||||||||||||||||||
Less reinsurance recoverable | 64,085 | 104,848 | |||||||||||||||||||||||
Net reserve at beginning of period | 2,997,316 | 3,951,995 | |||||||||||||||||||||||
Losses incurred: | |||||||||||||||||||||||||
Losses and LAE incurred in respect of default notices related to: | |||||||||||||||||||||||||
Current year | 454,390 | 686,454 | |||||||||||||||||||||||
Prior years (1) | (75,387 | ) | (43,783 | ) | |||||||||||||||||||||
Subtotal | 379,003 | 642,671 | |||||||||||||||||||||||
Losses paid: | |||||||||||||||||||||||||
Losses and LAE paid in respect of default notices related to: | |||||||||||||||||||||||||
Current year | 11,574 | 28,792 | |||||||||||||||||||||||
Prior years | 895,061 | 1,286,833 | |||||||||||||||||||||||
Reinsurance terminations (2) | - | (3,332 | ) | ||||||||||||||||||||||
Subtotal | 906,635 | 1,312,293 | |||||||||||||||||||||||
Net reserve at end of period | 2,469,684 | 3,282,373 | |||||||||||||||||||||||
Plus reinsurance recoverables | 57,898 | 70,621 | |||||||||||||||||||||||
Reserve at end of period | $ | 2,527,582 | $ | 3,352,994 | |||||||||||||||||||||
-1 | A negative number for prior year losses incurred indicates a redundancy of prior year loss reserves and a positive number for prior year losses incurred indicates a deficiency of prior year loss reserves. | ||||||||||||||||||||||||
-2 | In a termination, the reinsurance agreement is cancelled, with no future premium ceded and funds for any incurred but unpaid losses transferred to us. The transferred funds result in an increase in our investment portfolio (including cash and cash equivalents) and a decrease in net losses paid (reduction to losses incurred). In addition, there is an offsetting decrease in the reinsurance recoverable (increase in losses incurred), and thus there is no net impact to losses incurred. | ||||||||||||||||||||||||
Prior year development of the reserves | ' | ||||||||||||||||||||||||
The prior year development of the reserves in the first nine months of 2014 and 2013 is reflected in the table below. | |||||||||||||||||||||||||
Nine Months Ended September 30, | |||||||||||||||||||||||||
2014 | 2013 | ||||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Prior year loss development (1): | |||||||||||||||||||||||||
(Decrease) increase in estimated claim rate on primary defaults | $ | (38 | ) | $ | 10 | ||||||||||||||||||||
Decrease in estimated severity on primary defaults | (20 | ) | (40 | ) | |||||||||||||||||||||
Change in estimates related to pool reserves, LAE reserves and reinsurance | (17 | ) | (14 | ) | |||||||||||||||||||||
Total prior year loss development | $ | (75 | ) | $ | (44 | ) | |||||||||||||||||||
-1 | A negative number for prior year loss development indicates a redundancy of prior year loss reserves, and a positive number indicates a deficiency of prior year loss reserves. | ||||||||||||||||||||||||
Rollforward of primary default inventory | ' | ||||||||||||||||||||||||
A rollforward of our primary default inventory for the three and nine months ended September 30, 2014 and 2013 appears in the table below. The information concerning new notices and cures is compiled from monthly reports received from loan servicers. The level of new notice and cure activity reported in a particular month can be influenced by, among other things, the date on which a servicer generates its report, the number of business days in a month and transfers of servicing between loan servicers. Historically, losses incurred have followed a seasonal trend in which the second half of the year has weaker credit performance than the first half, with higher new notice activity and a lower cure rate. | |||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
September 30, | September 30, | ||||||||||||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||||||||||||
Default inventory at beginning of period | 85,416 | 117,105 | 103,328 | 139,845 | |||||||||||||||||||||
New Notices | 22,927 | 27,755 | 67,451 | 81,044 | |||||||||||||||||||||
Cures | (19,582 | ) | (24,105 | ) | (68,082 | ) | (80,677 | ) | |||||||||||||||||
Paids (including those charged to a deductible or captive) | (5,288 | ) | (8,659 | ) | (18,420 | ) | (27,155 | ) | |||||||||||||||||
Rescissions and denials | (319 | ) | (509 | ) | (1,123 | ) | (1,470 | ) | |||||||||||||||||
Default inventory at end of period | 83,154 | 111,587 | 83,154 | 111,587 | |||||||||||||||||||||
Aging of the primary default inventory | ' | ||||||||||||||||||||||||
Aging of the Primary Default Inventory | |||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||
Consecutive months in default | |||||||||||||||||||||||||
3 months or less | 16,209 | 19 | % | 18,941 | 18 | % | 20,144 | 18 | % | ||||||||||||||||
4 - 11 months | 18,890 | 23 | % | 24,514 | 24 | % | 24,138 | 22 | % | ||||||||||||||||
12 months or more | 48,055 | 58 | % | 59,873 | 58 | % | 67,305 | 60 | % | ||||||||||||||||
Total primary default inventory | 83,154 | 100 | % | 103,328 | 100 | % | 111,587 | 100 | % | ||||||||||||||||
Primary claims received inventory included in ending default inventory (1) | 5,194 | 6 | % | 6,948 | 7 | % | 9,858 | 9 | % | ||||||||||||||||
(1) Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to certain loans that we believed would be included in a potential resolution. As of September 30, 2014, rescissions of coverage on approximately 1,575 loans had been voluntarily suspended. | |||||||||||||||||||||||||
Number of payments delinquent | ' | ||||||||||||||||||||||||
Number of Payments Delinquent | |||||||||||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||||||||||
3 payments or less | 23,769 | 28 | % | 28,095 | 27 | % | 28,777 | 26 | % | ||||||||||||||||
4 - 11 payments | 18,985 | 23 | % | 24,605 | 24 | % | 25,089 | 22 | % | ||||||||||||||||
12 payments or more | 40,400 | 49 | % | 50,628 | 49 | % | 57,721 | 52 | % | ||||||||||||||||
Total primary default inventory | 83,154 | 100 | % | 103,328 | 100 | % | 111,587 | 100 | % |
Premium_Deficiency_Reserve_Tab
Premium Deficiency Reserve (Tables) | 9 Months Ended | ||||||||||||||||
Sep. 30, 2014 | |||||||||||||||||
Premium Deficiency Reserve [Abstract] | ' | ||||||||||||||||
Components of premium deficiency reserve | ' | ||||||||||||||||
The components of the premium deficiency reserve at September 30, 2014, December 31, 2013 and September 30, 2013 appear in the table below. | |||||||||||||||||
September 30, | December 31, | September 30, | |||||||||||||||
2014 | 2013 | 2013 | |||||||||||||||
(In millions) | |||||||||||||||||
Present value of expected future paid losses and expenses, net of expected future premium | $ | (570 | ) | $ | (669 | ) | $ | (709 | ) | ||||||||
Established loss reserves | 541 | 621 | 652 | ||||||||||||||
Net deficiency | $ | (29 | ) | $ | (48 | ) | $ | (57 | ) | ||||||||
Reconciliation of beginning and ending balances in the premium deficiency reserve | ' | ||||||||||||||||
The decrease in the premium deficiency reserve for the three and nine months ended September 30, 2014 was $6 million and $19 million, respectively, as shown in the table below, which represents the net result of actual premiums, losses and expenses as well as a net change in assumptions for these periods. The net change in assumptions for the three months ended September 30, 2014 is primarily related to higher estimated ultimate losses. The net change in assumptions for the nine months ended September 30, 2014 is primarily related to higher estimated ultimate premiums. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
30-Sep-14 | |||||||||||||||||
(In millions) | |||||||||||||||||
Premium Deficiency Reserve at beginning of period | $ | (35 | ) | $ | (48 | ) | |||||||||||
Paid claims and loss adjustment expenses | $ | 41 | $ | 132 | |||||||||||||
Decrease in loss reserves | (15 | ) | (81 | ) | |||||||||||||
Premium earned | (17 | ) | (59 | ) | |||||||||||||
Effects of present valuing on future premiums, losses and expenses | 3 | (1 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | 12 | (9 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | (6 | ) | 28 | ||||||||||||||
Premium Deficiency Reserve at end of period | $ | (29 | ) | $ | (29 | ) | |||||||||||
-1 | A (negative) positive number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a (deficiency) redundancy of the prior premium deficiency reserve. | ||||||||||||||||
The decrease in the premium deficiency reserve for the three and nine months ended September 30, 2013 was $4 million and $17 million, respectively, as shown in the table below. The net change in assumptions for both the three months and nine months ended September 30, 2013 is primarily related to higher estimated ultimate premiums. | |||||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||||
30-Sep-13 | |||||||||||||||||
(In millions) | |||||||||||||||||
Premium Deficiency Reserve at beginning of period | $ | (61 | ) | $ | (74 | ) | |||||||||||
Paid claims and loss adjustment expenses | $ | 51 | $ | 172 | |||||||||||||
Decrease in loss reserves | (37 | ) | (114 | ) | |||||||||||||
Premium earned | (24 | ) | (72 | ) | |||||||||||||
Effects of present valuing on future premiums, losses and expenses | - | (2 | ) | ||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | (10 | ) | (16 | ) | |||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | 14 | 33 | |||||||||||||||
Premium Deficiency Reserve at end of period | $ | (57 | ) | $ | (57 | ) | |||||||||||
-1 | A (negative) positive number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a (deficiency) redundancy of the prior premium deficiency reserve. |
Nature_of_Business_and_Basis_o1
Nature of Business and Basis of Presentation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
Dec. 31, 2013 | Jun. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | |
Nature of Business and Basis of Presentation [Abstract] | ' | ' | ' | ' |
PMIERs effective days after publication | ' | ' | '180 days | ' |
Mortgage Insurers transition period | ' | ' | '2 years | ' |
Period for submission of transition plan to GSE | ' | ' | '90 days | ' |
Holding company cash and investments | ' | ' | $517,000,000 | ' |
Assets of regulated insurance affiliates of MGIC | ' | ' | 100,000,000 | ' |
(Increase) decrease in restricted cash | 42,900,000 | -60,300,000 | -233,000 | 60,348,000 |
Restricted cash and cash equivalents | $17,440,000 | ' | $17,207,000 | ' |
Debt_Details
Debt (Details) (USD $) | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||||
Sep. 30, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Mar. 31, 2014 | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Dec. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Sep. 30, 2014 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Par Value [Member] | Par Value [Member] | Fair Value [Member] | Fair Value [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Other Observable Inputs (Level 2) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Significant Unobservable Inputs (Level 3) [Member] | Senior Notes [Member] | Senior Notes [Member] | Senior Notes [Member] | Senior Notes [Member] | Senior Notes [Member] | Convertible Senior Notes Due 2017 [Member] | Convertible Senior Notes Due 2017 [Member] | Convertible Senior Notes Due 2017 [Member] | Convertible Senior Notes - Due April 2020 [Member] | Convertible Senior Notes - Due April 2020 [Member] | Convertible Senior Notes - Due April 2020 [Member] | Convertible Senior Notes - Due April 2020 [Member] | Convertible Junior Subordinated Debentures Due 2063 [Member] | Convertible Junior Subordinated Debentures Due 2063 [Member] | Convertible Junior Subordinated Debentures Due 2063 [Member] | Convertible Junior Subordinated Debentures Due 2063 [Member] | Convertible Junior Subordinated Debentures Due 2063 [Member] | ||||
Senior Notes Due 2015 [Member] | Senior Notes Due 2015 [Member] | Period | Period | |||||||||||||||||||||||||||
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Outstanding principal amount | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $62,000,000 | $82,900,000 | $345,000,000 | ' | $345,000,000 | $500,000,000 | $500,000,000 | ' | $500,000,000 | $389,500,000 | ' | $389,500,000 | ' | $389,500,000 |
Repurchase of debt instrument | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20,900,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Stated interest rate (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 5.38% | 5.38% | 5.00% | ' | 5.00% | 2.00% | 2.00% | ' | 2.00% | 9.00% | ' | 9.00% | ' | 9.00% |
Maturity date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1-Nov-15 | 1-Nov-15 | 1-May-17 | ' | 1-May-17 | ' | 1-Apr-20 | ' | 1-Apr-20 | ' | ' | 1-Apr-63 | ' | 1-Apr-63 |
Interest payments made | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 300,000 | 1,700,000 | 2,800,000 | ' | ' | 8,600,000 | 8,600,000 | ' | ' | 5,000,000 | 0 | ' | ' | ' | 17,500,000 | 35,800,000 | ' |
Conversion rate (in shares per $1,000 note) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 74.4186 | ' | ' | ' | 143.8332 | ' | ' | ' | ' | 74.0741 | ' | ' |
Principal amount of notes used in determining conversion rate | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,000 | ' | ' | ' | 1,000 | ' | ' | 1,000 | ' | 1,000 | ' | ' |
Initial conversion price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $13.44 | ' | ' | ' | $6.95 | ' | ' | $13.50 | ' | $13.50 | ' | ' |
130% of conversion price (in dollars per share) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $9.03 | ' | ' | ' | ' | ' | ' | ' |
Net proceeds from convertible senior notes | ' | 0 | 484,625,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 484,600,000 | ' | ' | ' | ' | ' | ' | ' | ' |
Redemption price, percentage (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | 100.00% | ' | ' |
Percentage of conversion price (in hundredths) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 130.00% | ' | ' | 130.00% | ' | 130.00% | ' | ' |
Minimum number of trading days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '20 days | ' | ' | ' | ' | '20 days | ' | ' |
Maximum number of trading days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '30 days | ' | ' | ' | ' | '30 days | ' | ' |
Minimum number of consecutive interest periods for which interest payments may be deferred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1 | ' | 1 | ' | ' |
Maximum period for which interest payments may be deferred without giving rise to an event of default | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '10 years | ' | ' | ' | ' |
Interest payment deferred | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 18,300,000 | ' | ' | ' |
Interest payment due on the debentures | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 17,500,000 | ' | ' | ' |
Period preceding election to convert | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '5 days | ' | ' |
Holding company cash and investments | 517,000,000 | 517,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Unrealized gain loss on holding company investments | 4,500,000 | 4,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Modified duration of holding company investments | '3 years 3 months 18 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Liabilities [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Senior Notes | ' | ' | ' | 61,953,000 | 82,883,000 | 63,696,000 | 85,991,000 | 0 | 85,991,000 | 63,696,000 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Senior Notes due 2017 | ' | ' | ' | 345,000,000 | 345,000,000 | 374,498,000 | 388,988,000 | 374,498,000 | 388,988,000 | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Senior Notes due 2020 | ' | ' | ' | 500,000,000 | 500,000,000 | 656,250,000 | 685,625,000 | 656,250,000 | 685,625,000 | 0 | 0 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Convertible Junior Subordinated Debentures | ' | ' | ' | 389,522,000 | 389,522,000 | 497,371,000 | 439,186,000 | 0 | 0 | 497,371,000 | 439,186,000 | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Total Debt | ' | ' | ' | $1,296,475,000 | $1,317,405,000 | $1,591,815,000 | $1,599,790,000 | $1,030,748,000 | $1,160,604,000 | $561,067,000 | $439,186,000 | $0 | $0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Reinsurance_Details
Reinsurance (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |
Company | Company | ||||
Reinsurance [Abstract] | ' | ' | ' | ' | ' |
Percentage of quota share (in hundredths) | ' | ' | 30.00% | ' | ' |
Percentage of ceding commission (in hundredths) | ' | ' | 20.00% | ' | ' |
Percentage quota share in addendum (in hundredths) | ' | ' | 40.00% | ' | ' |
Profit commission receivable | $68,952,000 | ' | $68,952,000 | ' | $2,368,000 |
Number of other mortgage insurers agreeing to similar CFPB settlements | 3 | ' | 3 | ' | ' |
Period of existing captive reinsurance agreement | ' | ' | '10 years | ' | ' |
Reinsurance recoverable on loss reserves related to captive agreements | 48,000,000 | ' | 48,000,000 | ' | 64,000,000 |
Fair value of trust fund assets under captive agreements | 205,000,000 | ' | 205,000,000 | ' | 226,000,000 |
Fair value of trust fund assets under captive agreements, no reinsurance recoverable on loss reserves | 6,000,000 | ' | 6,000,000 | ' | 23,000,000 |
Premiums Written and Earned [Abstract] | ' | ' | ' | ' | ' |
Ceded premiums written, net of profit commission | 32,536,000 | 13,485,000 | 87,450,000 | 31,473,000 | ' |
Ceded premiums earned, net of profit commission | ' | ' | 79,460,000 | 23,499,000 | ' |
Ceded losses incurred | ' | ' | 22,451,000 | 21,238,000 | ' |
Ceding commissions | ' | ' | $28,994,000 | $4,646,000 | ' |
Litigation_and_Contingencies_D
Litigation and Contingencies (Details) (USD $) | 6 Months Ended | 9 Months Ended | 12 Months Ended | 36 Months Ended | ||||
Jun. 30, 2009 | Sep. 30, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2011 | |
Curtailments [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Average paid claim reduction due to curtailments (in hundredths) | ' | 6.50% | 5.80% | ' | ' | ' | ' | ' |
Number of days after claim paid within which objection must be received for review | ' | '90 days | ' | ' | ' | ' | ' | ' |
Claims resolved by rescissions [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Mitigation of paid losses by rescission of policies | ' | $75,000,000 | $135,000,000 | $300,000,000 | ' | ' | ' | $3,000,000,000 |
Percentage of claims received in a quarter resolved by rescission, lower range limit (in hundredths) | ' | 5.00% | ' | ' | ' | ' | ' | ' |
Percentage of claims received in a quarter resolved by rescission, upper range limit (in hundredths) | 28.00% | ' | ' | ' | ' | ' | ' | ' |
Mitigation of incurred losses by rescission of policies | ' | 0 | 0 | 0 | 0 | 200,000,000 | 2,500,000,000 | ' |
Reduction in estimated rescissions | ' | ' | ' | 200,000,000 | ' | ' | ' | ' |
Statute of limitations to bring legal proceedings disputing right to rescind coverage | ' | '3 years | ' | ' | ' | ' | ' | ' |
Maximum exposure above estimate provision for claims paying practices | ' | 670,000,000 | ' | ' | ' | ' | ' | ' |
Exposure from claims paying practices related to Countrywide matter (in hundredths) | ' | 58.00% | ' | ' | ' | ' | ' | ' |
Maximum exposure associated with other discussions and legal proceedings | ' | 38,000,000 | ' | ' | ' | ' | ' | ' |
Class action complaint under RESPA [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Period of existing captive reinsurance agreement | ' | '10 years | ' | ' | ' | ' | ' | ' |
Civil penalty | ' | ' | 2,650,000 | ' | ' | ' | ' | ' |
Other Legal Proceedings [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Underwriting remedy expense | ' | 3,000,000 | 5,000,000 | ' | ' | ' | ' | ' |
Class Action Complaint Under RESPA [Member] | Pending Litigation [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Class action complaint under RESPA [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Number of lawsuits | ' | 12 | ' | ' | ' | ' | ' | ' |
Number of cases dismissed | ' | 7 | ' | ' | ' | ' | ' | ' |
Countrywide Dispute [Member] | Pending Litigation [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Claims resolved by rescissions [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of damages sought | ' | $700,000,000 | ' | ' | ' | ' | ' | ' |
Lawsuits Alleging Improper Recording And Foreclosure Activities By MERS [Member] | Pending Litigation [Member] | ' | ' | ' | ' | ' | ' | ' | ' |
Lawsuits alleging improper recording and foreclosure activities by MERS [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' |
Number of lawsuits naming non-insurance subsidiary as defendant | ' | 8 | ' | ' | ' | ' | ' | ' |
Number of lawsuits naming subsidiary as defendant that were dismissed | ' | 7 | ' | ' | ' | ' | ' | ' |
Earnings_Loss_per_Share_Detail
Earnings (Loss) per Share (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Basic earnings per share [Abstract] | ' | ' | ' | ' |
Net income (loss) | $72,017 | $12,114 | $177,521 | ($48,441) |
Weighted average common shares outstanding (in shares) | 338,626,000 | 337,868,000 | 338,488,000 | 302,996,000 |
Basic income (loss) per share (in dollars per share) | $0.21 | $0.04 | $0.52 | ($0.16) |
Diluted earnings per share [Abstract] | ' | ' | ' | ' |
Net income (loss) | 72,017 | 12,114 | 177,521 | -48,441 |
Effect of dilutive securities [Abstract] | ' | ' | ' | ' |
2% Convertible Senior Notes | 3,049 | 0 | 9,148 | 0 |
Net income (loss) plus assumed conversions | $75,066 | $12,114 | $186,669 | ($48,441) |
Weighted-average shares - Basic (in shares) | 338,626,000 | 337,868,000 | 338,488,000 | 302,996,000 |
Common stock equivalents (in shares) | 74,950,000 | 1,558,000 | 74,985,000 | 0 |
Weighted-average shares - Diluted (in shares) | 413,576,000 | 339,426,000 | 413,473,000 | 302,996,000 |
Diluted income (loss) per share (in dollars per share) | $0.18 | $0.04 | $0.45 | ($0.16) |
Participating Securities [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded from EPS calculation (in shares) | ' | ' | ' | 100,000 |
Participating securities included weighted average number of common shares outstanding (in shares) | 100,000 | 100,000 | 100,000 | ' |
Common Stock Equivalents [Member] | ' | ' | ' | ' |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities excluded from EPS calculation (in shares) | 54,500,000 | 126,500,000 | 54,500,000 | 109,600,000 |
Investments_Details
Investments (Details) (USD $) | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2014 | Dec. 31, 2013 | |||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | $4,647,529,000 | $4,951,451,000 | ||
Gross Unrealized Gains | 26,960,000 | 16,755,000 | ||
Gross Unrealized Losses | -44,488,000 | [1] | -101,387,000 | [1] |
Fair Value | 4,630,001,000 | 4,866,819,000 | ||
Percentage of foreign investments held in government and semi-government securities (in hundredths) | 86.00% | ' | ||
Percentage of foreign investments held in corporate securities (in hundredths) | 10.00% | ' | ||
Percentage of foreign investments held in cash equivalents (in hundredths) | 4.00% | ' | ||
Percentage of Australian portfolio rated AAA (in hundredths) | 79.00% | ' | ||
Percentage of Australian portfolio rated AA (in hundredths) | 21.00% | ' | ||
Gross unrealized (gains) losses | 44,500,000 | 101,400,000 | ||
Maturities, Amortized Cost [Abstract] | ' | ' | ||
Due in one year or less | 405,324,000 | ' | ||
Due after one year through five years | 1,858,612,000 | ' | ||
Due after five years through ten years | 928,153,000 | ' | ||
Due after ten years | 435,242,000 | ' | ||
Total debt securities with single maturity date | 3,627,331,000 | ' | ||
Total at end of period | 4,644,561,000 | 4,948,543,000 | ||
Maturities, Fair Value [Abstract] | ' | ' | ||
Due in one year or less | 406,256,000 | ' | ||
Due after one year through five years | 1,863,872,000 | ' | ||
Due after five years through ten years | 922,372,000 | ' | ||
Due after ten years | 433,223,000 | ' | ||
Total debt securities with single maturity date | 3,625,723,000 | ' | ||
Total at end of period | 4,626,979,000 | 4,863,925,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 1,340,870,000 | 2,687,628,000 | ||
12 months or greater | 1,190,817,000 | 406,033,000 | ||
Total investment portfolio | 2,531,687,000 | 3,093,661,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 8,488,000 | 74,583,000 | ||
12 months or greater | 36,000,000 | 26,804,000 | ||
Total investment portfolio | 44,488,000 | 101,387,000 | ||
U.S. Treasury securities and obligations of U.S. government corporations and agencies [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 414,778,000 | 663,642,000 | ||
Gross Unrealized Gains | 2,636,000 | 1,469,000 | ||
Gross Unrealized Losses | -9,795,000 | [1] | -25,521,000 | [1] |
Fair Value | 407,619,000 | 639,590,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 6,320,000 | 465,975,000 | ||
12 months or greater | 325,892,000 | 4,103,000 | ||
Total investment portfolio | 332,212,000 | 470,078,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 43,000 | 24,980,000 | ||
12 months or greater | 9,752,000 | 541,000 | ||
Total investment portfolio | 9,795,000 | 25,521,000 | ||
Obligations of U.S. states and political subdivisions [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 833,510,000 | 932,922,000 | ||
Gross Unrealized Gains | 10,068,000 | 5,865,000 | ||
Gross Unrealized Losses | -4,316,000 | [1] | -17,420,000 | [1] |
Fair Value | 839,262,000 | 921,367,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 165,975,000 | 503,967,000 | ||
12 months or greater | 135,146,000 | 4,226,000 | ||
Total investment portfolio | 301,121,000 | 508,193,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 1,392,000 | 17,370,000 | ||
12 months or greater | 2,924,000 | 50,000 | ||
Total investment portfolio | 4,316,000 | 17,420,000 | ||
Corporate debt securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 2,341,189,000 | 2,190,095,000 | ||
Gross Unrealized Gains | 9,953,000 | 6,313,000 | ||
Gross Unrealized Losses | -12,587,000 | [1] | -24,993,000 | [1] |
Fair Value | 2,338,555,000 | 2,171,415,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 1,000,551,000 | 1,238,211,000 | ||
12 months or greater | 233,161,000 | 81,593,000 | ||
Total investment portfolio | 1,233,712,000 | 1,319,804,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 5,995,000 | 20,371,000 | ||
12 months or greater | 6,592,000 | 4,622,000 | ||
Total investment portfolio | 12,587,000 | 24,993,000 | ||
Asset-backed securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 341,519,000 | 399,839,000 | ||
Gross Unrealized Gains | 932,000 | 1,100,000 | ||
Gross Unrealized Losses | -202,000 | [1] | -453,000 | [1] |
Fair Value | 342,249,000 | 400,486,000 | ||
Maturities, Amortized Cost [Abstract] | ' | ' | ||
Debt securities without single maturity date | 341,519,000 | ' | ||
Maturities, Fair Value [Abstract] | ' | ' | ||
Debt securities without single maturity date | 342,249,000 | ' | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 56,801,000 | 126,991,000 | ||
12 months or greater | 14,675,000 | 7,114,000 | ||
Total investment portfolio | 71,476,000 | 134,105,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 137,000 | 387,000 | ||
12 months or greater | 65,000 | 66,000 | ||
Total investment portfolio | 202,000 | 453,000 | ||
Residential mortgage-backed securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 344,515,000 | 383,368,000 | ||
Gross Unrealized Gains | 167,000 | 146,000 | ||
Gross Unrealized Losses | -13,751,000 | [1] | -24,977,000 | [1] |
Fair Value | 330,931,000 | 358,537,000 | ||
Maturities, Amortized Cost [Abstract] | ' | ' | ||
Debt securities without single maturity date | 344,515,000 | ' | ||
Maturities, Fair Value [Abstract] | ' | ' | ||
Debt securities without single maturity date | 330,931,000 | ' | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 15,020,000 | 91,534,000 | ||
12 months or greater | 307,151,000 | 265,827,000 | ||
Total investment portfolio | 322,171,000 | 357,361,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 55,000 | 3,886,000 | ||
12 months or greater | 13,696,000 | 21,091,000 | ||
Total investment portfolio | 13,751,000 | 24,977,000 | ||
Commercial mortgage-backed securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 269,857,000 | 277,920,000 | ||
Gross Unrealized Gains | 675,000 | 131,000 | ||
Gross Unrealized Losses | -3,032,000 | [1] | -6,668,000 | [1] |
Fair Value | 267,500,000 | 271,383,000 | ||
Maturities, Amortized Cost [Abstract] | ' | ' | ||
Debt securities without single maturity date | 269,857,000 | ' | ||
Maturities, Fair Value [Abstract] | ' | ' | ||
Debt securities without single maturity date | 267,500,000 | ' | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 91,505,000 | 192,440,000 | ||
12 months or greater | 112,195,000 | 43,095,000 | ||
Total investment portfolio | 203,700,000 | 235,535,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 855,000 | 6,239,000 | ||
12 months or greater | 2,177,000 | 429,000 | ||
Total investment portfolio | 3,032,000 | 6,668,000 | ||
Collateralized loan obligations [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 61,339,000 | 61,337,000 | ||
Gross Unrealized Gains | 0 | 0 | ||
Gross Unrealized Losses | -763,000 | [1] | -1,042,000 | [1] |
Fair Value | 60,576,000 | 60,295,000 | ||
Maturities, Amortized Cost [Abstract] | ' | ' | ||
Debt securities without single maturity date | 61,339,000 | ' | ||
Maturities, Fair Value [Abstract] | ' | ' | ||
Debt securities without single maturity date | 60,576,000 | ' | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 0 | 60,295,000 | ||
12 months or greater | 60,576,000 | 0 | ||
Total investment portfolio | 60,576,000 | 60,295,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 0 | 1,042,000 | ||
12 months or greater | 763,000 | 0 | ||
Total investment portfolio | 763,000 | 1,042,000 | ||
Debt securities issued by foreign sovereign governments [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 37,854,000 | 39,420,000 | ||
Gross Unrealized Gains | 2,466,000 | 1,722,000 | ||
Gross Unrealized Losses | -33,000 | [1] | -290,000 | [1] |
Fair Value | 40,287,000 | 40,852,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 4,561,000 | 7,203,000 | ||
12 months or greater | 1,783,000 | 0 | ||
Total investment portfolio | 6,344,000 | 7,203,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 10,000 | 290,000 | ||
12 months or greater | 23,000 | 0 | ||
Total investment portfolio | 33,000 | 290,000 | ||
Total debt securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 4,644,561,000 | 4,948,543,000 | ||
Gross Unrealized Gains | 26,897,000 | 16,746,000 | ||
Gross Unrealized Losses | -44,479,000 | [1] | -101,364,000 | [1] |
Fair Value | 4,626,979,000 | 4,863,925,000 | ||
Equity securities [Member] | ' | ' | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ||
Amortized Cost | 2,968,000 | 2,908,000 | ||
Gross Unrealized Gains | 63,000 | 9,000 | ||
Gross Unrealized Losses | -9,000 | [1] | -23,000 | [1] |
Fair Value | 3,022,000 | 2,894,000 | ||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | ' | ' | ||
Less than 12 months | 137,000 | 1,012,000 | ||
12 months or greater | 238,000 | 75,000 | ||
Total investment portfolio | 375,000 | 1,087,000 | ||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | ' | ' | ||
Less than 12 months | 1,000 | 18,000 | ||
12 months or greater | 8,000 | 5,000 | ||
Total investment portfolio | $9,000 | $23,000 | ||
[1] | At September 30, 2014 and December 31, 2013, there were no other-than-temporary impairment losses recorded in other comprehensive income. |
Investments_Gain_Loss_on_Inves
Investments, Gain (Loss) on Investments (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Gain (Loss) on Investments [Line Items] | ' | ' | ' | ' |
Net realized investment gains (losses) and OTTI on investments | $632 | ($139) | $923 | $3,605 |
Gross realized gains, gross realized losses and impairment losses [Abstract] | ' | ' | ' | ' |
Gains on sales | 1,161 | 391 | 3,273 | 5,352 |
Losses on sales | -529 | -202 | -2,350 | -1,419 |
Impairment losses | 0 | -328 | 0 | -328 |
Total net realized gains (losses) | 632 | -139 | 923 | 3,605 |
Fixed Maturities [Member] | ' | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' | ' |
Net realized investment gains (losses) and OTTI on investments | 629 | -393 | 755 | 2,755 |
Gross realized gains, gross realized losses and impairment losses [Abstract] | ' | ' | ' | ' |
Total net realized gains (losses) | 629 | -393 | 755 | 2,755 |
Equity Securities [Member] | ' | ' | ' | ' |
Gain (Loss) on Investments [Line Items] | ' | ' | ' | ' |
Net realized investment gains (losses) and OTTI on investments | 3 | 254 | 168 | 850 |
Gross realized gains, gross realized losses and impairment losses [Abstract] | ' | ' | ' | ' |
Total net realized gains (losses) | $3 | $254 | $168 | $850 |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Sep. 30, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | $4,630,001 | $4,866,819 | ||
Real estate acquired | 16,565 | [1] | 13,280 | [1] |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 235,671 | 390,698 | ||
Real estate acquired | 0 | [1] | 0 | [1] |
Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 4,392,015 | 4,473,377 | ||
Real estate acquired | 0 | [1] | 0 | [1] |
Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 2,315 | 2,744 | ||
Real estate acquired | 16,565 | [1] | 13,280 | [1] |
U.S. Treasury securities and obligations of U.S. government corporations and agencies [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 407,619 | 639,590 | ||
U.S. Treasury securities and obligations of U.S. government corporations and agencies [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 192,683 | 347,273 | ||
U.S. Treasury securities and obligations of U.S. government corporations and agencies [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 214,936 | 292,317 | ||
U.S. Treasury securities and obligations of U.S. government corporations and agencies [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Obligations of U.S. states and political subdivisions [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 839,262 | 921,367 | ||
Obligations of U.S. states and political subdivisions [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Obligations of U.S. states and political subdivisions [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 837,268 | 918,944 | ||
Obligations of U.S. states and political subdivisions [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 1,994 | 2,423 | ||
Corporate debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 2,338,555 | 2,171,415 | ||
Corporate debt securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Corporate debt securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 2,338,555 | 2,171,415 | ||
Corporate debt securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Asset-backed securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 342,249 | 400,486 | ||
Asset-backed securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Asset-backed securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 342,249 | 400,486 | ||
Asset-backed securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Residential mortgage-backed securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 330,931 | 358,537 | ||
Residential mortgage-backed securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Residential mortgage-backed securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 330,931 | 358,537 | ||
Residential mortgage-backed securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Commercial mortgage-backed securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 267,500 | 271,383 | ||
Commercial mortgage-backed securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Commercial mortgage-backed securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 267,500 | 271,383 | ||
Commercial mortgage-backed securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Collateralized loan obligations [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 60,576 | 60,295 | ||
Collateralized loan obligations [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Collateralized loan obligations [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 60,576 | 60,295 | ||
Collateralized loan obligations [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Debt securities issued by foreign sovereign governments [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 40,287 | 40,852 | ||
Debt securities issued by foreign sovereign governments [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 40,287 | 40,852 | ||
Debt securities issued by foreign sovereign governments [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Debt securities issued by foreign sovereign governments [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Total debt securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 4,626,979 | 4,863,925 | ||
Total debt securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 232,970 | 388,125 | ||
Total debt securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 4,392,015 | 4,473,377 | ||
Total debt securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 1,994 | 2,423 | ||
Equity securities [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 3,022 | 2,894 | ||
Equity securities [Member] | Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 2,701 | 2,573 | ||
Equity securities [Member] | Significant Other Observable Inputs (Level 2) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | 0 | 0 | ||
Equity securities [Member] | Significant Unobservable Inputs (Level 3) [Member] | ' | ' | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ||
Total investments | $321 | $321 | ||
[1] | Real estate acquired through claim settlement, which is held for sale, is reported in Other Assets on the consolidated balance sheet. |
Fair_Value_Measurements_Unobse
Fair Value Measurements, Unobservable Input Reconciliation (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Obligations of U.S. States and Political Subdivisions [Member] | ' | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Balance at beginning of period | $2,231 | $2,811 | $2,423 | $3,130 |
Total realized/unrealized gains (losses) [Abstract] | ' | ' | ' | ' |
Included in earnings and reported as realized investment gains (losses), net | ' | ' | ' | 0 |
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 30 | 30 |
Sales | -237 | -241 | -459 | -590 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Balance at end of period | 1,994 | 2,570 | 1,994 | 2,570 |
Amount of total losses included in earnings attributable to the change in unrealized losses on assets still held | 0 | 0 | 0 | 0 |
Corporate Debt Securities [Member] | ' | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Balance at beginning of period | ' | 0 | ' | 17,114 |
Total realized/unrealized gains (losses) [Abstract] | ' | ' | ' | ' |
Included in earnings and reported as realized investment gains (losses), net | ' | ' | ' | -225 |
Included in earnings and reported as losses incurred, net | ' | 0 | ' | 0 |
Purchases | ' | 0 | ' | 0 |
Sales | ' | 0 | ' | -16,889 |
Transfers into Level 3 | ' | 0 | ' | 0 |
Transfers out of Level 3 | ' | 0 | ' | 0 |
Balance at end of period | ' | 0 | ' | 0 |
Amount of total losses included in earnings attributable to the change in unrealized losses on assets still held | ' | 0 | ' | 0 |
Equity Securities [Member] | ' | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Balance at beginning of period | 321 | 321 | 321 | 321 |
Total realized/unrealized gains (losses) [Abstract] | ' | ' | ' | ' |
Included in earnings and reported as realized investment gains (losses), net | ' | ' | ' | 0 |
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 0 | 0 |
Sales | 0 | 0 | 0 | 0 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Balance at end of period | 321 | 321 | 321 | 321 |
Amount of total losses included in earnings attributable to the change in unrealized losses on assets still held | 0 | 0 | 0 | 0 |
Total Investments [Member] | ' | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Balance at beginning of period | 2,552 | 3,132 | 2,744 | 20,565 |
Total realized/unrealized gains (losses) [Abstract] | ' | ' | ' | ' |
Included in earnings and reported as realized investment gains (losses), net | ' | ' | ' | -225 |
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 | 0 |
Purchases | 0 | 0 | 30 | 30 |
Sales | -237 | -241 | -459 | -17,479 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Balance at end of period | 2,315 | 2,891 | 2,315 | 2,891 |
Amount of total losses included in earnings attributable to the change in unrealized losses on assets still held | 0 | 0 | 0 | 0 |
Real Estate Acquired [Member] | ' | ' | ' | ' |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ' | ' | ' | ' |
Balance at beginning of period | 10,804 | 8,741 | 13,280 | 3,463 |
Total realized/unrealized gains (losses) [Abstract] | ' | ' | ' | ' |
Included in earnings and reported as realized investment gains (losses), net | ' | ' | ' | 0 |
Included in earnings and reported as losses incurred, net | -2,062 | -1,378 | -4,378 | -3,680 |
Purchases | 14,107 | 10,857 | 33,484 | 28,401 |
Sales | -6,284 | -5,844 | -25,821 | -15,808 |
Transfers into Level 3 | 0 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 | 0 |
Balance at end of period | 16,565 | 12,376 | 16,565 | 12,376 |
Amount of total losses included in earnings attributable to the change in unrealized losses on assets still held | $0 | $0 | $0 | $0 |
Other_Comprehensive_Income_Det
Other Comprehensive Income (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||||||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |||||
Other comprehensive income (before tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Change in unrealized gains and losses on investments | ($17,377) | $7,163 | $67,102 | ($102,468) | ' | |||||
Benefit plan adjustments | -1,732 | ' | -5,198 | ' | ' | |||||
Unrealized foreign currency translation adjustment | -3,835 | 2,901 | -1,000 | -15,868 | ' | |||||
Other comprehensive income (loss) | -22,944 | 10,064 | 60,904 | -118,336 | ' | |||||
Other comprehensive income (tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Change in unrealized gains and losses on investments | 6,069 | -2,526 | -23,436 | 35,586 | ' | |||||
Benefit plan adjustments | 606 | ' | 1,819 | ' | ' | |||||
Unrealized foreign currency translation adjustment | 1,345 | -1,016 | 350 | 5,557 | ' | |||||
Other comprehensive income (loss) | 8,020 | -3,542 | -21,267 | 41,143 | ' | |||||
Other comprehensive income (valuation allowance) [Abstract] | ' | ' | ' | ' | ' | |||||
Change in unrealized investment gains and losses, net | -5,993 | 2,640 | 23,132 | -33,914 | ' | |||||
Benefit plan adjustments | -606 | ' | -1,819 | ' | ' | |||||
Other comprehensive income foreign currency translation valuation allowance | 0 | 0 | 0 | 0 | ' | |||||
Other comprehensive income (loss) | -6,599 | 2,640 | 21,313 | -33,914 | ' | |||||
Other comprehensive income (net of tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Change in unrealized investment gains and losses on investments | -17,301 | 7,277 | 66,798 | -100,796 | ' | |||||
Benefit plan adjustments | -1,732 | ' | -5,198 | ' | ' | |||||
Unrealized foreign currency translation adjustment | -2,490 | 1,885 | -650 | -10,311 | ' | |||||
Other comprehensive income (loss) | -21,523 | 9,162 | 60,950 | -111,107 | ' | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' | ' | |||||
Balance at beginning of period, before tax | 6,632 | -125,916 | -77,216 | 2,484 | ' | |||||
Other comprehensive income (loss) before reclassifications | -22,052 | 7,297 | 55,332 | -111,456 | ' | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 892 | -2,767 | -5,572 | 6,880 | ' | |||||
Net current period other comprehensive income (loss) | -22,944 | 10,064 | 60,904 | -118,336 | ' | |||||
Balance at end of period, before tax | -16,312 | -115,852 | -16,312 | -115,852 | ' | |||||
Tax effect | -40,464 | [1] | -43,418 | [1] | -40,464 | [1] | -43,418 | [1] | -40,510 | [1] |
Total accumulated other comprehensive income (loss), net of tax | -56,776 | -159,270 | -56,776 | -159,270 | -117,726 | |||||
Tax Effect due to valuation allowance (in hundredths) | ' | ' | 35.00% | ' | ' | |||||
Unrealized gains and losses on available-for-sale securities [Member] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (before tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (loss) | -17,377 | 7,163 | 67,102 | -102,468 | ' | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' | ' | |||||
Balance at beginning of period, before tax | -155 | -68,090 | -84,634 | 41,541 | ' | |||||
Other comprehensive income (loss) before reclassifications | -18,217 | 4,396 | 56,332 | -95,588 | ' | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | -840 | [2] | -2,767 | [2] | -10,770 | [2] | 6,880 | [2] | ' | |
Net current period other comprehensive income (loss) | -17,377 | 7,163 | 67,102 | -102,468 | ' | |||||
Balance at end of period, before tax | -17,532 | -60,927 | -17,532 | -60,927 | ' | |||||
Tax effect | -64,360 | [1] | -64,968 | [1] | -64,360 | [1] | -64,968 | [1] | -64,056 | [1] |
Total accumulated other comprehensive income (loss), net of tax | -81,892 | -125,895 | -81,892 | -125,895 | -148,690 | |||||
Defined benefit plans [Member] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (before tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (loss) | -1,732 | 0 | -5,198 | 0 | ' | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' | ' | |||||
Balance at beginning of period, before tax | -7,232 | -71,804 | -3,766 | -71,804 | ' | |||||
Other comprehensive income (loss) before reclassifications | 0 | 0 | 0 | 0 | ' | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 1,732 | [3] | 0 | 5,198 | [3] | 0 | ' | |||
Net current period other comprehensive income (loss) | -1,732 | 0 | -5,198 | 0 | ' | |||||
Balance at end of period, before tax | -8,964 | -71,804 | -8,964 | -71,804 | ' | |||||
Tax effect | 26,940 | [1] | 26,940 | [1] | 26,940 | [1] | 26,940 | [1] | 26,940 | [1] |
Total accumulated other comprehensive income (loss), net of tax | 17,976 | -44,864 | 17,976 | -44,864 | 23,174 | |||||
Foreign currency translation [Member] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (before tax) [Abstract] | ' | ' | ' | ' | ' | |||||
Other comprehensive income (loss) | -3,835 | 2,901 | -1,000 | -15,868 | ' | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | ' | ' | ' | ' | ' | |||||
Balance at beginning of period, before tax | 14,019 | 13,978 | 11,184 | 32,747 | ' | |||||
Other comprehensive income (loss) before reclassifications | -3,835 | 2,901 | -1,000 | -15,868 | ' | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | 0 | 0 | ' | |||||
Net current period other comprehensive income (loss) | -3,835 | 2,901 | -1,000 | -15,868 | ' | |||||
Balance at end of period, before tax | 10,184 | 16,879 | 10,184 | 16,879 | ' | |||||
Tax effect | -3,044 | [1] | -5,390 | [1] | -3,044 | [1] | -5,390 | [1] | -3,394 | [1] |
Total accumulated other comprehensive income (loss), net of tax | $7,140 | $11,489 | $7,140 | $11,489 | $7,790 | |||||
[1] | Tax effect does not approximate 35% due to amounts of tax benefits not provided in various periods due to our tax valuation allowance. | |||||||||
[2] | During the three and nine months ended September 30, 2014, net unrealized losses of ($0.8) million and ($10.8) million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. During the three and nine months ended September 30, 2013, net unrealized (losses) gains of ($2.8) million and $6.9 million, respectively were reclassified to the Consolidated Statement of Operations and included in Realized investment gains, net. | |||||||||
[3] | During the three and nine months ended September 30, 2014, other comprehensive income related to benefit plans of $1.7 million and $5.2 million, respectively, was reclassified to the Consolidated Statement of Operations and included in Underwriting and other expenses, net. |
Benefit_Plans_Details
Benefit Plans (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 |
Pension and Supplemental Executive Retirement Plans [Member] | ' | ' | ' | ' |
Components of Net Periodic Benefit Cost [Abstract] | ' | ' | ' | ' |
Service cost | $2,142 | $2,835 | $6,425 | $8,504 |
Interest Cost | 3,997 | 3,823 | 11,991 | 11,467 |
Expected return on plan assets | -5,258 | -5,035 | -15,773 | -15,108 |
Recognized net actuarial loss | 271 | 1,536 | 812 | 4,609 |
Amortization of prior service cost | -233 | 125 | -698 | 377 |
Net periodic benefit cost | 919 | 3,284 | 2,757 | 9,849 |
Other Postretirement Benefits [Member] | ' | ' | ' | ' |
Components of Net Periodic Benefit Cost [Abstract] | ' | ' | ' | ' |
Service cost | 165 | 202 | 494 | 609 |
Interest Cost | 164 | 155 | 491 | 464 |
Expected return on plan assets | -1,162 | -919 | -3,486 | -2,759 |
Recognized net actuarial loss | -109 | 0 | -326 | 0 |
Amortization of prior service cost | -1,663 | -1,663 | -4,988 | -4,987 |
Net periodic benefit cost | ($2,605) | ($2,225) | ($7,815) | ($6,673) |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2007 | Dec. 31, 2013 | |
Tax provision (benefit) [Abstract] | ' | ' | ' | ' | ' | ' |
Tax provision (benefit) before valuation allowance | $25,030,000 | ($674,000) | $65,322,000 | ($17,792,000) | ' | ' |
Change in valuation allowance | -24,781,000 | 1,010,000 | -63,229,000 | 20,257,000 | ' | ' |
Provision for income taxes | 249,000 | 336,000 | 2,093,000 | 2,465,000 | ' | ' |
Change in deferred tax valuation allowance, included in other comprehensive income | 6,600,000 | -2,600,000 | -21,300,000 | 33,900,000 | ' | ' |
Valuation allowance | 919,700,000 | ' | 919,700,000 | ' | ' | 1,004,200,000 |
Net operating loss carryforwards, regular tax basis | 2,500,000,000 | ' | 2,500,000,000 | ' | ' | ' |
Net operating loss carryforwards for computing the alternative minimum tax | 1,600,000,000 | ' | 1,600,000,000 | ' | ' | ' |
Information regarding income tax examinations [Abstract] | ' | ' | ' | ' | ' | ' |
Amount of IRS assessment for unpaid taxes and penalties related to REMIC issue | 197,500,000 | ' | 197,500,000 | ' | ' | ' |
Estimate of federal interest that may be due | 164,800,000 | ' | 164,800,000 | ' | ' | ' |
Amount of payment made related to the IRS assessment on the REMIC issue | ' | ' | ' | ' | 65,200,000 | ' |
Estimate of additional state income taxes and interest that may be due | 47,000,000 | ' | 47,000,000 | ' | ' | ' |
Amount of IRS assessment for unpaid taxes and penalties related to disallowance of carryback of 2009 net operating loss | 261,400,000 | ' | 261,400,000 | ' | ' | ' |
Total amount of unrecognized tax benefits | 106,000,000 | ' | 106,000,000 | ' | ' | ' |
Total amount of the unrecognized tax benefits that would affect our effective tax rate | 93,400,000 | ' | 93,400,000 | ' | ' | ' |
Unrecognized tax benefits, accrued interest | $26,700,000 | ' | $26,700,000 | ' | ' | $26,100,000 |
Loss_Reserves_Details
Loss Reserves (Details) (USD $) | 9 Months Ended | |||
In Thousands, unless otherwise specified | Sep. 30, 2014 | Sep. 30, 2013 | ||
Loss Reserve [Roll Forward] | ' | ' | ||
Reserve at beginning of period | $3,061,401 | $4,056,843 | ||
Less reinsurance recoverable | 64,085 | 104,848 | ||
Net reserve at beginning of period | 2,997,316 | 3,951,995 | ||
Losses and LAE incurred in respect of default notices related to: | ' | ' | ||
Current year | 454,390 | 686,454 | ||
Prior years | -75,387 | [1],[2] | -43,783 | [1],[2] |
Subtotal | 379,003 | 642,671 | ||
Losses and LAE paid in respect of default notices related to: | ' | ' | ||
Current year | 11,574 | 28,792 | ||
Prior years | 895,061 | 1,286,833 | ||
Reinsurance terminations | 0 | [3] | -3,332 | [3] |
Subtotal | 906,635 | 1,312,293 | ||
Net reserve at end of period | 2,469,684 | 3,282,373 | ||
Plus reinsurance recoverables | 57,898 | 70,621 | ||
Reserve at end of period | $2,527,582 | $3,352,994 | ||
[1] | A negative number for prior year loss development indicates a redundancy of prior year loss reserves, and a positive number indicates a deficiency of prior year loss reserves. | |||
[2] | A negative number for prior year losses incurred indicates a redundancy of prior year loss reserves and a positive number for prior year losses incurred indicates a deficiency of prior year loss reserves. | |||
[3] | In a termination, the reinsurance agreement is cancelled, with no future premium ceded and funds for any incurred but unpaid losses transferred to us. The transferred funds result in an increase in our investment portfolio (including cash and cash equivalents) and a decrease in net losses paid (reduction to losses incurred). In addition, there is an offsetting decrease in the reinsurance recoverable (increase in losses incurred), and thus there is no net impact to losses incurred. |
Loss_Reserves_Change_in_Liabil
Loss Reserves, Change in Liability and Claims Adjustment Expense (Details) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2012 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2013 | ||||||
Loan | Loan | Loan | Loan | Loan | Loan | ||||||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Change in loss reserves | ' | ' | ($75,387,000) | [1],[2] | ($43,783,000) | [1],[2] | ' | ' | ' | ' | |||
Historical average period for uncured default to develop into paid claim | ' | ' | '12 months | ' | ' | ' | ' | ' | |||||
Premium refund liability, expected claim payments | 112,000,000 | ' | 112,000,000 | ' | ' | ' | ' | 131,000,000 | |||||
Primary Default Inventory [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Default inventory at the beginning of period | 85,416 | 117,105 | 103,328 | 139,845 | ' | ' | ' | ' | |||||
New Notices | 22,927 | 27,755 | 67,451 | 81,044 | ' | ' | ' | ' | |||||
Cures | -19,582 | -24,105 | -68,082 | -80,677 | ' | ' | ' | ' | |||||
Paids (including those charged to a deductible or captive) | -5,288 | -8,659 | -18,420 | -27,155 | ' | ' | ' | ' | |||||
Rescissions and denials | -319 | -509 | -1,123 | -1,470 | ' | ' | ' | ' | |||||
Default inventory at end of period | 83,154 | 111,587 | 83,154 | 111,587 | 139,845 | ' | ' | ' | |||||
Pool insurance notice inventory [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Pool insurance notice inventory (in number of loans) | 4,525 | 6,821 | 4,525 | 6,821 | ' | ' | ' | 6,563 | |||||
Aging of the Primary Default Inventory [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
3 months or less | 16,209 | 20,144 | 16,209 | 20,144 | ' | ' | ' | 18,941 | |||||
3 months or less (in hundredths) | 19.00% | 18.00% | 19.00% | 18.00% | ' | ' | ' | 18.00% | |||||
4 - 11 months | 18,890 | 24,138 | 18,890 | 24,138 | ' | ' | ' | 24,514 | |||||
4 - 11 months (in hundredths) | 23.00% | 22.00% | 23.00% | 22.00% | ' | ' | ' | 24.00% | |||||
12 months or more | 48,055 | 67,305 | 48,055 | 67,305 | ' | ' | ' | 59,873 | |||||
12 months or more (in hundredths) | 58.00% | 60.00% | 58.00% | 60.00% | ' | ' | ' | 58.00% | |||||
Total primary default inventory | 83,154 | 111,587 | 83,154 | 111,587 | 139,845 | ' | ' | ' | |||||
Total primary default inventory (in hundredths) | 100.00% | 100.00% | 100.00% | 100.00% | ' | ' | ' | 100.00% | |||||
Primary claims received inventory included in ending default inventory | 5,194 | [3] | 9,858 | [3] | 5,194 | [3] | 9,858 | [3] | ' | ' | ' | 6,948 | [3] |
Primary claims received inventory included in ending default inventory (in hundredths) | 6.00% | [3] | 9.00% | [3] | 6.00% | [3] | 9.00% | [3] | ' | ' | ' | 7.00% | [3] |
Number of rescindable loans affected by Company's decision to voluntarily suspend rescissions | 1,575 | ' | 1,575 | ' | ' | ' | ' | ' | |||||
Number of payments delinquent [Abstract] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
3 payments or less | 23,769 | 28,777 | 23,769 | 28,777 | ' | ' | ' | 28,095 | |||||
3 payments or less (in hundredths) | 28.00% | 26.00% | 28.00% | 26.00% | ' | ' | ' | 27.00% | |||||
4 - 11 payments | 18,985 | 25,089 | 18,985 | 25,089 | ' | ' | ' | 24,605 | |||||
4 - 11 payments (in hundredths) | 23.00% | 22.00% | 23.00% | 22.00% | ' | ' | ' | 24.00% | |||||
12 payments or more | 40,400 | 57,721 | 40,400 | 57,721 | ' | ' | ' | 50,628 | |||||
12 payments or more (in hundredths) | 49.00% | 52.00% | 49.00% | 52.00% | ' | ' | ' | 49.00% | |||||
Total primary default inventory | 83,154 | 111,587 | 83,154 | 111,587 | 139,845 | ' | ' | ' | |||||
Total primary default inventory (in hundredths) | 100.00% | 100.00% | 100.00% | 100.00% | ' | ' | ' | 100.00% | |||||
Estimated Rescission Reduction - Loss Reserve [Roll Forward] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Estimated rescission reduction - losses incurred | ' | ' | ' | ' | -200,000,000 | 200,000,000 | 2,500,000,000 | ' | |||||
Premium refund liability, expected future rescissions | 29,000,000 | ' | 29,000,000 | ' | ' | ' | ' | 15,000,000 | |||||
(Decrease) increase in estimated claim rate on primary defaults [Member] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Change in loss reserves | ' | ' | -38,000,000 | [1] | 10,000,000 | [1] | ' | ' | ' | ' | |||
Percentage of prior year default inventory resolved (in hundredths) | ' | ' | 50.00% | 48.00% | ' | ' | ' | ' | |||||
Decrease in estimated severity on primary defaults [Member] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Change in loss reserves | ' | ' | -20,000,000 | [1] | -40,000,000 | [1] | ' | ' | ' | ' | |||
Change In Estimates Related to Pool Reserves, LAE Reserves and Reinsurance [Member] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | |||||
Change in loss reserves | ' | ' | ($17,000,000) | [1] | ($14,000,000) | [1] | ' | ' | ' | ' | |||
[1] | A negative number for prior year loss development indicates a redundancy of prior year loss reserves, and a positive number indicates a deficiency of prior year loss reserves. | ||||||||||||
[2] | A negative number for prior year losses incurred indicates a redundancy of prior year loss reserves and a positive number for prior year losses incurred indicates a deficiency of prior year loss reserves. | ||||||||||||
[3] | Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to certain loans that we believed would be included in a potential resolution. As of September 30, 2014, rescissions of coverage on approximately 1,575 loans had been voluntarily suspended. |
Premium_Deficiency_Reserve_Det
Premium Deficiency Reserve (Details) (USD $) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2014 | Sep. 30, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | |||||
Premium Deficiency Reserve [Abstract] | ' | ' | ' | ' | ' | ||||
Present value of expected future paid losses and expenses, net of expected future premium | ($570,000,000) | ($709,000,000) | ($570,000,000) | ($709,000,000) | ($669,000,000) | ||||
Established loss reserves | 541,000,000 | 652,000,000 | 541,000,000 | 652,000,000 | 621,000,000 | ||||
Net deficiency | -28,711,000 | -57,000,000 | -28,711,000 | -57,000,000 | ' | ||||
Change in premium deficiency reserve | 6,000,000 | 4,000,000 | 19,000,000 | 17,000,000 | ' | ||||
Premium Deficiency Reserve [Roll Forward] | ' | ' | ' | ' | ' | ||||
Premium Deficiency Reserve at beginning of period | -35,000,000 | -61,000,000 | -48,461,000 | -74,000,000 | ' | ||||
Paid claims and loss adjustment expenses | 41,000,000 | 51,000,000 | 132,000,000 | 172,000,000 | ' | ||||
Decrease in loss reserves | -15,000,000 | -37,000,000 | -81,000,000 | -114,000,000 | ' | ||||
Premium earned | -17,000,000 | -24,000,000 | -59,000,000 | -72,000,000 | ' | ||||
Effects of present valuing on future premiums, losses and expenses | 3,000,000 | 0 | -1,000,000 | -2,000,000 | ' | ||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | 12,000,000 | -10,000,000 | -9,000,000 | -16,000,000 | ' | ||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses expenses and discount rate | -6,000,000 | [1] | 14,000,000 | [1] | 28,000,000 | [1] | 33,000,000 | [1] | ' |
Premium Deficiency Reserve at end of period | ($28,711,000) | ($57,000,000) | ($28,711,000) | ($57,000,000) | ' | ||||
[1] | A (negative) positive number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a (deficiency) redundancy of the prior premium deficiency reserve. |
Shareholders_Equity_Details
Shareholders' Equity (Details) (USD $) | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2014 | Mar. 31, 2013 | Sep. 30, 2014 | Sep. 30, 2013 | Dec. 31, 2013 | Jun. 30, 2013 | |
Right | Right | |||||
Shareholders' Equity [Abstract] | ' | ' | ' | ' | ' | ' |
Common stock, shares authorized (in shares) | 1,000,000,000 | ' | 1,000,000,000 | ' | 1,000,000,000 | 680,000,000 |
Sale of common stock (in shares) | ' | 135,000,000 | ' | ' | ' | ' |
Sale of common stock, price per share (in dollars per share) | ' | $5.15 | ' | ' | ' | ' |
Sale of common stock, net proceeds | ' | $663,300,000 | $0 | $663,335,000 | ' | ' |
Shareholder Rights Agreement [Abstract] | ' | ' | ' | ' | ' | ' |
Shareholder rights accompanying each outstanding share of the company's common stock (in number of Rights) | 1 | ' | 1 | ' | ' | ' |
Distribution date, description | 'The earlier of ten days after a public announcement that a person has become an Acquiring Person, or ten business days after a person announces or begins a tender offer in which consummation of such offer would result in a person becoming an Acquiring Person | ' | ' | ' | ' | ' |
Common stock, beneficial ownership threshold to be considered an Acquiring Person (in hundredths) | 5.00% | ' | 5.00% | ' | ' | ' |
Common shares purchasable per Right (in shares) | 0.1 | ' | 0.1 | ' | ' | ' |
Purchase price (in dollars per share) | $14 | ' | $14 | ' | ' | ' |
Purchase price (in dollars per one-tenth share) | $1.40 | ' | $1.40 | ' | ' | ' |
Redemption price (in dollars per Right) | $0.00 | ' | $0.00 | ' | ' | ' |
Convertible Senior Notes - due April 2020 [Member] | ' | ' | ' | ' | ' | ' |
Debt Instrument [Line Items] | ' | ' | ' | ' | ' | ' |
Outstanding principal amount | $500,000,000 | $500,000,000 | $500,000,000 | ' | 500,000,000 | ' |
Stated interest rate (in hundredths) | 2.00% | 2.00% | 2.00% | ' | 2.00% | ' |
Statutory_Capital_Details
Statutory Capital (Details) (USD $) | 9 Months Ended | |
Sep. 30, 2014 | Dec. 31, 2013 | |
Jurisdiction | ||
Related Party Transaction [Line Items] | ' | ' |
Number of jurisdictions with risk-to-capital requirements | 16 | ' |
Statutory capital requirements [Abstract] | ' | ' |
Maximum permitted risk-to-capital ratio commonly applied | '25 to 1 | ' |
Risk-to-capital ratio on a combined basis at end of period | '17.0 to 1 | ' |
Percentage of surplus as regards policyholders (in hundredths) | 10.00% | ' |
Statutory deferred tax assets admitted | $134,000,000 | $138,000,000 |
Mortgage Guaranty Insurance Corporation [Member] | ' | ' |
Statutory capital requirements [Abstract] | ' | ' |
Risk to capital ratio at end of period | '15.0 to 1 | ' |
Amount of policyholders position above or below required MPP | 605,000,000 | ' |
Amount of required MPP | 1,000,000,000 | ' |
MGIC Indemnity Corporation [Member] | ' | ' |
Statutory capital requirements [Abstract] | ' | ' |
Statutory capital of subsidiary | 466,000,000 | ' |
Risk in force, net of reinsurance, of subsidiary | $547,000,000 | ' |