Document_and_Entity_Informatio
Document and Entity Information (USD $) | 12 Months Ended | ||
In Billions, except Share data, unless otherwise specified | Dec. 31, 2014 | Feb. 13, 2015 | Jun. 30, 2014 |
Document and Entity Information [Abstract] | |||
Entity Registrant Name | MGIC INVESTMENT CORP | ||
Entity Central Index Key | 876437 | ||
Current Fiscal Year End Date | -19 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $3.10 | ||
Entity Common Stock, Shares Outstanding | 338,920,963 | ||
Document Fiscal Year Focus | 2014 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | FALSE | ||
Document Period End Date | 31-Dec-14 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Securities, available-for-sale, at fair value: | ||
Fixed maturities (amortized cost, 2014 - $4,602,514; 2013 - $4,948,543) | $4,609,614 | $4,863,925 |
Equity securities | 3,055 | 2,894 |
Total investment portfolio | 4,612,669 | 4,866,819 |
Cash and cash equivalents | 197,882 | 332,692 |
Restricted cash and cash equivalents (note 2) | 17,212 | 17,440 |
Accrued investment income | 30,518 | 31,660 |
Prepaid reinsurance premiums (note 11) | 47,623 | 36,243 |
Reinsurance recoverable on loss reserves (note 11) | 57,841 | 64,085 |
Reinsurance recoverable on paid losses (note 11) | 6,424 | 10,425 |
Premiums receivable | 57,442 | 62,301 |
Home office and equipment, net | 28,693 | 26,185 |
Deferred insurance policy acquisition costs | 12,240 | 9,721 |
Profit commission receivable (note 11) | 91,500 | 2,368 |
Other assets | 106,390 | 141,451 |
Total assets | 5,266,434 | 5,601,390 |
Liabilities: | ||
Loss reserves (notes 9 and 11) | 2,396,807 | 3,061,401 |
Premium deficiency reserve (note 10) | 23,751 | 48,461 |
Unearned premiums | 203,414 | 154,479 |
Senior notes (note 8) | 61,918 | 82,773 |
Convertible senior notes (note 8) | 845,000 | 845,000 |
Convertible junior debentures (note 8) | 389,522 | 389,522 |
Other liabilities | 309,119 | 275,216 |
Total liabilities | 4,229,531 | 4,856,852 |
Contingencies (note 20) | ||
Shareholders' equity (note 15): | ||
Common stock (one dollar par value, shares authorized 1,000,000; shares issued 2014 and 2013 - 340,047; outstanding 2014 - 338,560; 2013 - 337,758) | 340,047 | 340,047 |
Paid-in capital | 1,663,592 | 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 12) | -81,341 | -117,726 |
Retained deficit | -852,458 | -1,074,617 |
Total shareholders' equity | 1,036,903 | 744,538 |
Total liabilities and shareholders' equity | $5,266,434 | $5,601,390 |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | Jun. 30, 2013 | Apr. 30, 2012 |
In Thousands, except Per Share data, unless otherwise specified | ||||
Securities, available-for-sale, at fair value: | ||||
Fixed maturities, amortized cost | $4,602,514 | $4,948,543 | ||
Shareholders' equity (note 15): | ||||
Common stock, par value (in dollars per share) | $1 | $1 | ||
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | 680,000 | 460,000 |
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 (USD $) | 12 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Premiums written: | |||
Direct | $999,943 | $994,910 | $1,049,549 |
Assumed | 1,653 | 2,074 | 2,425 |
Ceded (note 11) | -119,634 | -73,503 | -34,142 |
Net premiums written | 881,962 | 923,481 | 1,017,832 |
(Increase) decrease in unearned premiums | -37,591 | 19,570 | 15,338 |
Net premiums earned (note 11) | 844,371 | 943,051 | 1,033,170 |
Investment income, net of expenses (note 6) | 87,647 | 80,739 | 121,640 |
Net realized investment gains (losses) (note 6): | |||
Total other-than-temporary impairment losses | -144 | -328 | -2,310 |
Portion of losses recognized in other comprehensive income (loss), before taxes (note 12) | 0 | 0 | 0 |
Net impairment losses recognized in earnings | -144 | -328 | -2,310 |
Other realized investment gains | 1,501 | 6,059 | 197,719 |
Net realized gains (losses) on securities | 1,357 | 5,731 | 195,409 |
Other revenue | 8,422 | 9,914 | 28,145 |
Total revenues | 941,797 | 1,039,435 | 1,378,364 |
Losses and expenses: | |||
Losses incurred, net (notes 9 and 11) | 496,077 | 838,726 | 2,067,253 |
Change in premium deficiency reserve (note 10) | -24,710 | -25,320 | -61,036 |
Amortization of deferred policy acquisition costs | 7,618 | 10,641 | 7,452 |
Other underwriting and operating expenses, net (note 11) | 138,441 | 181,877 | 193,995 |
Interest expense (note 8) | 69,648 | 79,663 | 99,344 |
Total losses and expenses | 687,074 | 1,085,587 | 2,307,008 |
Income (loss) before tax | 254,723 | -46,152 | -928,644 |
Provision for (benefit from) income taxes (note 14) | 2,774 | 3,696 | -1,565 |
Net income (loss) | $251,949 | ($49,848) | ($927,079) |
Income (loss) per share (note 3): | |||
Basic (in dollars per share) | $0.74 | ($0.16) | ($4.59) |
Diluted (in dollars per share) | $0.64 | ($0.16) | ($4.59) |
Weighted average common shares outstanding - basic (note 3) (in shares) | 338,523 | 311,754 | 201,892 |
Weighted average common shares outstanding - diluted (note 3) (in shares) | 413,547 | 311,754 | 201,892 |
Dividends per share (in dollars per share) | $0 | $0 | $0 |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | |||||||||||
Net income (loss) | $74,428 | $72,017 | $45,522 | $59,982 | ($1,407) | $12,114 | $12,375 | ($72,930) | $251,949 | ($49,848) | ($927,079) |
Other comprehensive income (loss), net of tax (note 12): | |||||||||||
Change in unrealized investment gains and losses (note 6) | 91,139 | -123,591 | -78,659 | ||||||||
Benefit plans adjustment (note 13) | -52,112 | 68,038 | -1,221 | ||||||||
Foreign currency translation adjustment | -2,642 | -14,010 | 1,593 | ||||||||
Other comprehensive income (loss), net of tax | 36,385 | -69,563 | -78,287 | ||||||||
Comprehensive income (loss) | $288,334 | ($119,411) | ($1,005,366) |
CONSOLIDATED_STATEMENTS_OF_SHA
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (USD $) | Total | Common Stock [Member] | Paid-in Capital [Member] | Treasury Stock [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Retained Earnings (Deficit) [Member] |
In Thousands, unless otherwise specified | ||||||
Balance at Dec. 31, 2011 | $1,196,815 | $205,047 | $1,135,821 | ($162,542) | $30,124 | ($11,635) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | -927,079 | 0 | 0 | 0 | 0 | -927,079 |
Change in unrealized investment gains and losses, net (note 6) | -78,659 | 0 | 0 | 0 | -78,659 | 0 |
Reissuance of treasury stock, net (note 15) | -2,733 | 0 | -8,749 | 57,583 | 0 | -51,567 |
Equity compensation (note 18) | 8,224 | 0 | 8,224 | 0 | 0 | 0 |
Benefit plans adjustments, net (note 13) | -1,221 | 0 | 0 | 0 | -1,221 | 0 |
Unrealized foreign currency translation adjustment, net | 1,593 | 0 | 0 | 0 | 1,593 | 0 |
Balance at Dec. 31, 2012 | 196,940 | 205,047 | 1,135,296 | -104,959 | -48,163 | -990,281 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | -49,848 | 0 | 0 | 0 | 0 | -49,848 |
Change in unrealized investment gains and losses, net (note 6) | -123,591 | 0 | 0 | 0 | -123,591 | 0 |
Common stock issuance (note 15) | 663,335 | 135,000 | 528,335 | 0 | 0 | 0 |
Reissuance of treasury stock, net (note 15) | -1,856 | 0 | -7,892 | 40,524 | 0 | -34,488 |
Equity compensation (note 18) | 5,530 | 0 | 5,530 | 0 | 0 | 0 |
Benefit plans adjustments, net (note 13) | 68,038 | 0 | 0 | 0 | 68,038 | 0 |
Unrealized foreign currency translation adjustment, net | -14,010 | 0 | 0 | 0 | -14,010 | 0 |
Balance at Dec. 31, 2013 | 744,538 | 340,047 | 1,661,269 | -64,435 | -117,726 | -1,074,617 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income (loss) | 251,949 | 0 | 0 | 0 | 0 | 251,949 |
Change in unrealized investment gains and losses, net (note 6) | 91,139 | 0 | 0 | 0 | 91,139 | 0 |
Reissuance of treasury stock, net (note 15) | -4,972 | 0 | -6,680 | 31,498 | 0 | -29,790 |
Equity compensation (note 18) | 9,003 | 0 | 9,003 | 0 | 0 | 0 |
Benefit plans adjustments, net (note 13) | -52,112 | 0 | 0 | 0 | -52,112 | 0 |
Unrealized foreign currency translation adjustment, net | -2,642 | 0 | 0 | 0 | -2,642 | 0 |
Balance at Dec. 31, 2014 | $1,036,903 | $340,047 | $1,663,592 | ($32,937) | ($81,341) | ($852,458) |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | |||
Net income (loss) | $251,949 | ($49,848) | ($927,079) |
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||
Depreciation and other amortization | 48,365 | 68,716 | 100,135 |
Deferred tax provision (benefit) | 312 | 590 | -34 |
Realized investment gains, net | -1,501 | -6,059 | -197,719 |
Net investment impairment losses | 144 | 328 | 2,310 |
Loss (gain) on repurchase on senior notes | 837 | 0 | -17,775 |
Other | -5,084 | 30,077 | -21,802 |
Change in certain assets and liabilities: | |||
Accrued investment income | 1,142 | -4,417 | 28,423 |
Prepaid reinsurance premium | -11,380 | -35,402 | 776 |
Reinsurance recoverable on loss reserves | 6,244 | 40,763 | 49,759 |
Reinsurance recoverable on paid losses | 4,001 | 5,180 | 4,286 |
Premiums receivable | 4,859 | 5,527 | 3,245 |
Deferred insurance policy acquisition costs | -2,519 | 1,524 | -3,740 |
Profit commission receivable | -89,132 | -2,368 | 0 |
Real estate | 622 | -9,817 | -1,842 |
Loss reserves | -664,594 | -995,442 | -500,669 |
Premium deficiency reserve | -24,710 | -25,320 | -61,036 |
Unearned premiums | 48,935 | 15,639 | -16,026 |
Return premium accrual | 22,200 | -11,800 | -11,700 |
Income taxes payable (current) | -674 | 598 | 1,888 |
Net cash used in operating activities | -409,984 | -971,531 | -1,568,600 |
Purchases of investments: | |||
Fixed maturities | -1,979,917 | -3,248,602 | -5,025,204 |
Equity securities | -94 | -111 | -132 |
Proceeds from sales of fixed maturities | 1,147,624 | 1,054,985 | 5,216,934 |
Proceeds from maturity of fixed maturities | 1,129,087 | 1,357,028 | 1,461,955 |
Net increase (decrease) in payable for securities | 13 | 13 | -20 |
Net decrease (increase) in restricted cash | 228 | -17,440 | 0 |
Net cash provided by (used in) investing activities | 296,941 | -854,127 | 1,653,533 |
Cash flows from financing activities: | |||
Net proceeds from convertible senior notes | 0 | 484,625 | 0 |
Common stock shares issued | 0 | 663,335 | 0 |
Repayment of long-term debt | -21,767 | -17,235 | -53,107 |
Net cash (used in) provided by financing activities | -21,767 | 1,130,725 | -53,107 |
Net (decrease) increase in cash and cash equivalents | -134,810 | -694,933 | 31,826 |
Cash and cash equivalents at beginning of year | 332,692 | 1,027,625 | 995,799 |
Cash and cash equivalents at end of year | $197,882 | $332,692 | $1,027,625 |
Nature_of_Business
Nature of Business | 12 Months Ended | ||
Dec. 31, 2014 | |||
Nature of Business [Abstract] | |||
Nature of Business | 1 | Nature of Business | |
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 to protect against loss from defaults on low down payment residential mortgage loans. Our principal product is primary mortgage insurance. Primary insurance provides mortgage default protection on individual loans and covers unpaid loan principal, delinquent interest and certain expenses associated with the default and subsequent foreclosure or sale approved by us. Prior to 2009, we also wrote pool mortgage insurance. Pool insurance generally covers the excess of the loss on a defaulted mortgage loan which exceeds the claim payment under the primary coverage, if primary insurance is required on that mortgage loan, as well as the total loss on a defaulted mortgage loan which did not require primary insurance. Through certain other non-insurance subsidiaries, we also provide various services for the mortgage finance industry, such as contract underwriting and portfolio analysis and retention. We began our international operations in Australia, where we started to write business in June 2007. Since 2008, we are no longer writing new business in Australia. Our Australian operations are included in our consolidated financial statements; however they are not material to our consolidated results. | |||
At December 31, 2014, our direct domestic primary insurance in force was $164.9 billion, which represents the principal balance in our records of all mortgage loans that we insure, and our direct domestic primary risk in force was $42.9 billion, which represents the insurance in force multiplied by the insurance coverage percentage. Our direct pool risk in force at December 31, 2014 was approximately $0.8 billion ($0.3 billion on pool policies with aggregate loss limits and $0.5 billion on pool policies without aggregate loss limits). Our risk in force in Australia at December 31, 2014 was approximately $346 million which represents the risk associated with 100% coverage on the insurance in force. The mortgage insurance we provided in Australia only covers the unpaid loan balance after the sale of the underlying property. | |||
Capital - GSEs | |||
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 the financial strength rating requirement (its financial strength rating from Moody’s is Ba3 (with a stable outlook) and from Standard & Poor’s is BB+ (with a stable 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 based on an insurer's book and 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 no earlier than late in the first quarter of 2015 and the “effective date” to occur 180 days thereafter. Under the draft PMIERs mortgage insurers would 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. | |||
Shortly after the draft PMIERs were released, we estimated that we would have a shortfall in Available Assets of approximately $600 million on December 31, 2014, which was when the final PMIERs were expected to be published. We also estimated that the shortfall would be reduced to approximately $300 million through operations over a two year period. Those shortfall projections assumed the risk in force and capital of MGIC’s MIC subsidiary would be repatriated to MGIC, and full credit would be given in the calculation of Minimum Required Assets for our existing reinsurance agreement (approximately $500 million of credit at December 31, 2014, increasing to $600 million of credit over two years). However, we do not expect our existing reinsurance agreement would be given full credit under the PMIERs. Applying the same assumptions, but considering the delay in publication of the final PMIERs, our shortfall projections have improved modestly. Also, we have been in discussions with the participating reinsurers regarding modifications to the agreement so that we would receive additional PMIERs credit. | |||
In addition to modifying our reinsurance agreement, we believe we will be able to use a combination of the alternatives outlined below so that MGIC will meet the GSE Financial Requirements of the draft PMIERs even if they are implemented as released. As of December 31, 2014, we had approximately $491 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 December 31, 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 non-dilutive debt capital to mitigate the shortfall. 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 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 agreements 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 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 are required to 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 Federal Housing Administration (“FHA”), the Veteran’s Administration (“VA”) or other credit enhancement products. | |||
See additional disclosure regarding statutory capital in Note 17 – “Statutory Capital.” |
Basis_of_Presentation
Basis of Presentation | 12 Months Ended | |
Dec. 31, 2014 | ||
Basis of Presentation [Abstract] | ||
Basis of Presentation | 2 | Basis of Presentation |
The accompanying consolidated financial statements have been prepared on the basis of accounting principles generally accepted in the United States of America (“GAAP”), as codified in the Accounting Standards Codification. In accordance with GAAP, we are required to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. | ||
Principles of Consolidation | ||
The consolidated financial statements include the accounts of MGIC Investment Corporation and its majority-owned subsidiaries. All intercompany transactions have been eliminated. | ||
Cash and Cash Equivalents | ||
We consider money market funds and investments with original maturities of three months or less to be cash equivalents. | ||
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 December 31, 2014, approximately $17.2 million remains in escrow in connection with the CHL agreement. See additional discussion of these settlement agreements in Note 20 – “Litigation and contingencies.” | ||
Reclassifications | ||
Certain reclassifications have been made in the accompanying consolidated financial statements to 2013 and 2012 amounts to conform to the 2014 presentation. | ||
Subsequent Events | ||
We have considered subsequent events through the date of this filing. |
Summary_of_Significant_Account
Summary of Significant Accounting Policies | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Summary of Significant Accounting Policies [Abstract] | |||||||||||||
Summary of Significant Accounting Policies | 3 | Summary of Significant Accounting Policies | |||||||||||
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, equity 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 primarily 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. The fair value of real estate acquired is the lower of our acquisition cost or a percentage of the appraised value. The percentage applied to the 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. | |||||||||||||
Investments | |||||||||||||
Our entire investment portfolio is classified as available-for-sale and is reported at fair value. The related unrealized gains or losses are, after considering the related tax expense or benefit, recognized as a component of accumulated other comprehensive income (loss) in shareholders' equity. Realized investment gains and losses are reported in income based upon specific identification of securities sold. (See Note 6 – “Investments.”) | |||||||||||||
Each quarter we perform reviews of our investments in order to determine whether declines in fair value below amortized cost were considered other-than-temporary in accordance with applicable guidance. In evaluating whether a decline in fair value is other-than-temporary, we consider several factors including, but not limited to: | |||||||||||||
§ | our intent to sell the security or whether it is more likely than not that we will be required to sell the security before recovery; | ||||||||||||
§ | extent and duration of the decline; | ||||||||||||
§ | failure of the issuer to make scheduled interest or principal payments; | ||||||||||||
§ | change in rating below investment grade; and | ||||||||||||
§ | adverse conditions specifically related to the security, an industry, or a geographic area. | ||||||||||||
Based on our evaluation, we will record an other-than-temporary impairment adjustment on a security if we intend to sell the impaired security, if it is more likely than not that we will be required to sell the impaired security prior to recovery of its amortized cost basis, or if the present value of the cash flows we expect to collect is less than the amortized cost basis of the security. If the fair value of a security is below its amortized cost at the time of our intent to sell, the security is classified as other-than-temporarily impaired and the full amount of the impairment is recognized as a loss in the statement of operations. Otherwise, when a security is considered to be other-than-temporarily impaired, the losses are separated into the portion of the loss that represents the credit loss; and the portion that is due to other factors. The credit loss portion is recognized as a loss in the statement of operations, while the loss due to other factors is recognized in accumulated other comprehensive income (loss), net of taxes. A credit loss is determined to exist if the present value of the discounted cash flows, using the security’s original yield, expected to be collected from the security are less than the cost basis of the security. | |||||||||||||
Home office and equipment | |||||||||||||
Home office and equipment is carried at cost net of depreciation. For financial statement reporting purposes, depreciation is determined on a straight-line basis for the home office, equipment and data processing hardware over estimated lives of 45, 5 and 3 years, respectively. For income tax purposes, we use accelerated depreciation methods. | |||||||||||||
Home office and equipment is shown net of accumulated depreciation of $54.9 million, $53.0 million and $51.3 million at December 31, 2014, 2013 and 2012, respectively. Depreciation expense for the years ended December 31, 2014, 2013 and 2012 was $2.2 million, $1.8 million and $1.9 million, respectively. | |||||||||||||
Deferred Insurance Policy Acquisition Costs | |||||||||||||
Costs directly associated with the successful acquisition of mortgage insurance business, consisting of employee compensation and other policy issuance and underwriting expenses, are initially deferred and reported as deferred insurance policy acquisition costs (“DAC”). The deferred costs are net of any ceding commissions received associated with our reinsurance agreements. For each underwriting year of business, these costs are amortized to income in proportion to estimated gross profits over the estimated life of the policies. We utilize anticipated investment income in our calculation. This includes accruing interest on the unamortized balance of DAC. The estimates for each underwriting year are reviewed quarterly and updated when necessary to reflect actual experience and any changes to key variables such as persistency or loss development. If a premium deficiency exists (in other words, no gross profit is expected), we reduce the related DAC by the amount of the deficiency or to zero through a charge to current period earnings. If the deficiency is more than the related DAC balance, we then establish a premium deficiency reserve equal to the excess, by means of a charge to current period earnings. | |||||||||||||
Loss Reserves | |||||||||||||
Reserves are established for reported insurance losses and loss adjustment expenses based on when we receive notices of default on insured mortgage loans. We consider a loan in default when it is two or more payments past due. Even though the accounting standard, Accounting Standards Codification (“ASC”) 944, regarding accounting and reporting by insurance entities specifically excludes mortgage insurance from its guidance relating to loss reserves, we establish loss reserves using the general principles contained in the insurance standard. However, consistent with industry standards for mortgage insurers, we do not establish loss reserves for future claims on insured loans which are not currently in default. 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. Our loss estimates are established based upon historical experience, including rescission and loan modification activity. Adjustments to reserve estimates are reflected in the financial statements in the years in which the adjustments are made. The liability for reinsurance assumed is based on information provided by the ceding companies. | |||||||||||||
Reserves are also established for estimated losses from defaults occurring prior to the close of an accounting period on notices of default not yet reported to us. These incurred but not reported (“IBNR”) reserves are also established using estimated claim rates and claim severities. | |||||||||||||
Reserves also provide for the estimated costs of settling claims, including legal and other expenses and general expenses of administering the claims settlement process. Reserves are also ceded to reinsurers under our reinsurance agreements. (See Note 9 – “Loss Reserves” and Note 11 – “Reinsurance.”) | |||||||||||||
Premium Deficiency Reserve | |||||||||||||
After our loss reserves are initially established, we perform premium deficiency tests using our best estimate assumptions as of the testing date. Premium deficiency reserves are established, if necessary, when the present value of expected future losses and expenses exceeds the present value of expected future premium and already established reserves. The discount rate used in the calculation of the premium deficiency reserve is based upon our pre-tax investment yield at year-end. Products are grouped for premium deficiency purposes based on similarities in the way the products are acquired, serviced and measured for profitability. | |||||||||||||
Calculations of premium deficiency reserves require the use of significant judgments and estimates to determine the present value of future premium and present value of expected losses and expenses on our business. The present value of future premium relies on, among other factors, assumptions about persistency and repayment patterns on underlying loans. The present value of expected losses and expenses depends on assumptions relating to severity of claims and claim rates on current defaults, and expected defaults in future periods. These assumptions also include an estimate of expected rescission activity. Assumptions used in calculating the deficiency reserves can be affected by volatility in the current housing and mortgage lending industries and these effects could be material. To the extent premium patterns and actual loss experience differ from the assumptions used in calculating the premium deficiency reserves, the differences between the actual results and our estimate will affect future period earnings. (See Note 10 - “Premium Deficiency Reserve.”) | |||||||||||||
Revenue Recognition | |||||||||||||
We write policies which are guaranteed renewable contracts at the insured's option on a monthly, single, or annual premium basis. We have no ability to reunderwrite or reprice these contracts. Premiums written on monthly policies are earned as coverage is provided. Premiums written on a single premium basis and an annual premium basis are initially deferred as unearned premium reserve and earned over the policy life. Premiums written on policies covering more than one year are amortized over the policy life in relationship to the anticipated incurred loss pattern based on historical experience. Premiums written on annual policies are earned on a monthly pro rata basis. When a policy is cancelled for a reason other than rescission or claim payment, all premium that is non-refundable is immediately earned. Any refundable premium is returned to the servicer or borrower. Cancellations also include rescissions and policies cancelled due to claim payment. When a policy is rescinded, all previously collected premium is returned to the lender and when a claim is paid we return any premium received since the date of default. The liability associated with our estimate of premium to be returned is accrued for separately and separate components of this liability are included in “Other liabilities” and “Premium deficiency reserves” on our consolidated balance sheet. Changes in these liabilities affect premiums written and earned and change in premium deficiency reserve, respectively. The actual return of premium for all periods affects premiums written and earned. Policy cancellations also lower the persistency rate which is a variable used in calculating the rate of amortization of deferred insurance policy acquisition costs. | |||||||||||||
Fee income of our non-insurance subsidiaries is earned and recognized as the services are provided and the customer is obligated to pay. Fee income consists primarily of contract underwriting and related fee-based services provided to lenders and is included in “Other revenue” on the consolidated statements of operations. | |||||||||||||
Income Taxes | |||||||||||||
Deferred income taxes are provided under the liability method, which recognizes the future tax effects of temporary differences between amounts reported in the financial statements and the tax bases of these items. The expected tax effects are computed at the enacted regular federal tax rate. Using this method, we have recorded a net deferred tax asset, before valuation allowance, in large part due to net operating losses incurred in prior years. On a quarterly basis, we review the need to maintain a deferred tax asset valuation allowance as an offset to the net deferred tax asset, before valuation allowance. 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, the expiration dates of the carryforwards, the cyclical nature of our operating results, and available tax planning strategies. As discussed in Note 14 –“Income Taxes,” we continue to reduce our benefit from income tax through the recognition of a valuation allowance. | |||||||||||||
We provide for uncertain tax positions and the related interest and penalties based on our assessment of whether a tax benefit is more likely than not to be sustained under any examination by taxing authorities. | |||||||||||||
Benefit Plans | |||||||||||||
We have a non-contributory defined benefit pension plan covering substantially all employees, as well as a supplemental executive retirement plan. Retirement benefits are based on compensation and years of service. We recognize these retirement benefit costs over the period during which employees render the service that qualifies them for benefits. Our policy is to fund pension cost as required under the Employee Retirement Income Security Act of 1974. | |||||||||||||
We offer both medical and dental benefits for retired domestic employees, their eligible spouses and dependents until the retiree reaches the age of 65. Under the plan retirees pay a premium for these benefits. We accrue the estimated costs of retiree medical and dental benefits over the period during which employees render the service that qualifies them for benefits. (See Note 13 – “Benefit Plans.”) | |||||||||||||
Reinsurance | |||||||||||||
Loss reserves and unearned premiums are reported before taking credit for amounts ceded under reinsurance agreements. Ceded loss reserves are reflected as "Reinsurance recoverable on loss reserves." Ceded unearned premiums are reflected as “Prepaid reinsurance premiums.” Amounts due from reinsurers on paid claims are reflected as “Reinsurance recoverable on paid losses.” Ceded premiums payable are included in “Other liabilities.” Any profit commissions are included with “Premiums written – Ceded” and any ceding commissions are included with “Other underwriting and operating expenses, net.” We remain liable for all reinsurance ceded. (See Note 11 – “Reinsurance.”) | |||||||||||||
Foreign Currency Translation | |||||||||||||
Assets and liabilities denominated in a foreign currency are translated at the year-end exchange rates. Operating results are translated at average rates of exchange prevailing during the year. Unrealized gains and losses, net of deferred taxes, resulting from translation are included in accumulated other comprehensive income (loss) in shareholders’ equity. Gains and losses resulting from transactions in a foreign currency are recorded in current period net income (loss) at the rate on the transaction date. | |||||||||||||
Share-Based Compensation | |||||||||||||
We have certain share-based compensation plans. Under the fair value method, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period which generally corresponds to the vesting period. The fair value of awards classified as liabilities is remeasured at each reporting period until the award is settled. Awards under our plans generally vest over periods ranging from one to three years. (See Note 18 – “Share-based Compensation Plans.”) | |||||||||||||
Earnings per Share | |||||||||||||
Basic earnings per share (“EPS”) is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS includes the components of basic EPS and also gives effect to dilutive common stock equivalents. We calculate diluted EPS using the treasury stock method and if-converted method. Under the treasury stock method, diluted EPS reflects the potential dilution that could occur if unvested restricted stock or granted stock options result in the issuance of common stock. Under the if-converted method, diluted EPS reflects the potential dilution that could occur if our convertible debt instruments result in the issuance of common stock. The determination of potentially issuable shares does not consider the satisfaction of the conversion requirements and the shares are included in the determination of diluted EPS as of the beginning of the period, if dilutive. We have several debt issuances that could potentially result in contingently issuable shares and consider each potential issuance of shares separately to reflect the maximum potential dilution. Accordingly, our dilutive common stock equivalents may not reflect all of the potential contingently issuable shares that could be required to be issued upon any debt conversion. For purposes of calculating basic and diluted EPS, vested restricted stock awards are considered outstanding. | |||||||||||||
GAAP requires unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, to be treated as participating securities and included in the computation of EPS pursuant to the two-class method. Our participating securities are composed of unvested restricted stock with non-forfeitable rights to dividends. There have been no dividends declared by us since the issuance of these participating securities and there has been no reduction to net income available to common shareholders. For the year ended December 31, 2014, participating securities of 0.1 million have been included in basic EPS and 0.1 million and 1.1 million have been excluded for the years ended December 31, 2013 and 2012, respectively, as they are anti-dilutive due to our net losses. | |||||||||||||
The computation of diluted EPS for the year ended December 31, 2014 includes the weighted average unvested restricted stock units outstanding of 3.1 million. During 2013 and 2012 we reported a consolidated net loss. As a result of the net loss, unvested restricted stock awards were anti-dilutive for the year and were not included in the computation of diluted weighted average shares. | |||||||||||||
For the year ended December 31, 2014, the outstanding Convertible Senior Notes due in 2020 are reflected in diluted earnings per share using the “if-converted” method. Under this method, if dilutive, the common stock is assumed issued as of the beginning the reporting period and included in calculating diluted EPS. In addition, if dilutive, interest expense, net of tax, related to the outstanding Convertible Senior Notes due in 2020 is added back to earnings in calculating diluted EPS. For the year ended December 31, 2014, 2013, and 2012, common stock equivalents under our convertible debt instruments of 54.5 million, 126.4 million, and 60.7 million, respectively, were excluded from weighted average shares as they were anti-dilutive. | |||||||||||||
The following table reconciles basic and diluted EPS amounts: | |||||||||||||
Years Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands, except per share data) | |||||||||||||
Basic earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Average common shares outstanding | 338,523 | 311,754 | 201,892 | ||||||||||
Basic income (loss) per share | $ | 0.74 | $ | (0.16 | ) | $ | (4.59 | ) | |||||
Diluted earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Interest expense, net of tax: | |||||||||||||
2% Convertible Senior Notes due 2020 | 12,197 | - | - | ||||||||||
Diluted income available to common shareholders | $ | 264,146 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Weighted-average shares - Basic | 338,523 | 311,754 | 201,892 | ||||||||||
Effect of dilutive securities: | |||||||||||||
Unvested restricted stock | 3,082 | - | - | ||||||||||
Convertible debt common stock equivalents | 71,942 | - | - | ||||||||||
Weighted-average shares - Diluted | 413,547 | 311,754 | 201,892 | ||||||||||
Diluted income (loss) per share | $ | 0.64 | $ | (0.16 | ) | $ | (4.59 | ) |
New_Accounting_Policies
New Accounting Policies | 12 Months Ended | |
Dec. 31, 2014 | ||
New Accounting Policies [Abstract] | ||
New Accounting Policies | 4 | New Accounting Policies |
In August 2014, the FASB issued an update that requires management to evaluate whether there is substantial doubt about the entity’s ability to continue as a going concern and, if so, disclose that fact. 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 consolidated financial statements and disclosures. | ||
In June 2014, the FASB issued updated guidance to resolve diversity in practice concerning employee shared-based payments that contain performance targets that could be achieved after the requisite service period. The updated guidance requires that a performance target that affects vesting and that can be achieved after the requisite service period be treated as a performance condition. Compensation cost should be recognized in the period in which it becomes probable that the performance target will be achieved and should represent the compensation cost attributable to the periods for which service has been rendered. If the performance target becomes probable of being achieved before the end of the service period, the remaining unrecognized compensation cost for which requisite service has not yet been rendered is recognized prospectively over the remaining service period. The total amount of compensation cost recognized during and after the service period should reflect the number of awards that are expected to vest and should be adjusted to reflect those awards that ultimately vest. This updated guidance is effective for annual and interim periods beginning after December 15, 2015. The adoption of this guidance is not expected to have a significant impact on our consolidated financial statements and disclosures. | ||
In May 2014, the FASB issued updated guidance to clarify the principles for recognizing revenue. While insurance contracts are not within the scope of this updated guidance, our fee income related to contract underwriting and other fee-based services provided to lenders will be subject to this guidance. The updated guidance requires an entity to recognize revenue as performance obligations are met, in order to reflect the transfer of promised goods or services to customers in an amount that reflects the consideration the entity is entitled to receive for those goods or services. The guidance also requires additional disclosure about the nature, amount, timing, and uncertainty of revenue and cash flows arising from customer contracts. This update is effective for the quarter ending March 31, 2017. The adoption of this guidance is not expected to have a significant impact on our consolidated financial statements and disclosures. | ||
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. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended | |
Dec. 31, 2014 | ||
Related Party Transactions [Abstract] | ||
Related Party Transactions | 5 | Related Party Transactions |
There were no related party transactions during 2014, 2013 or 2012. |
Investments
Investments | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Investments [Abstract] | |||||||||||||||||||||||||
Investments | 6 | Investments | |||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at December 31, 2014 and 2013 are shown below: | |||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||||||||||
31-Dec-14 | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||
Gains | Losses (1) | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 349,153 | $ | 2,752 | $ | (5,130 | ) | $ | 346,775 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 844,942 | 12,961 | (2,761 | ) | 855,142 | ||||||||||||||||||||
Corporate debt securities | 2,418,991 | 16,325 | (10,035 | ) | 2,425,281 | ||||||||||||||||||||
Asset-backed securities | 286,260 | 535 | (140 | ) | 286,655 | ||||||||||||||||||||
Residential mortgage-backed securities | 329,983 | 254 | (9,000 | ) | 321,237 | ||||||||||||||||||||
Commercial mortgage-backed securities | 276,215 | 1,221 | (2,158 | ) | 275,278 | ||||||||||||||||||||
Collateralized loan obligations | 61,340 | - | (1,264 | ) | 60,076 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 35,630 | 3,540 | - | 39,170 | |||||||||||||||||||||
Total debt securities | 4,602,514 | 37,588 | (30,488 | ) | 4,609,614 | ||||||||||||||||||||
Equity securities | 3,003 | 61 | (9 | ) | 3,055 | ||||||||||||||||||||
Total investment portfolio | $ | 4,605,517 | $ | 37,649 | $ | (30,497 | ) | $ | 4,612,669 | ||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | ||||||||||||||||||||||
31-Dec-13 | Gains | Losses (1) | |||||||||||||||||||||||
(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 | There were no other-than-temporary impairment losses recorded in other comprehensive income (loss) at December 31, 2014 and 2013. | ||||||||||||||||||||||||
Our foreign investments primarily consist of the investment portfolio supporting our Australian domiciled subsidiary. In December 2013, our Australian subsidiary liquidated a portion of its investment portfolio and repatriated, with regulatory approval, $89.5 million to its parent MGIC. The remaining 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. Eighty-three percent of the Australian portfolio is rated AAA, by one or more of Moody’s, Standard & Poor’s and Fitch Ratings, and the remaining 17% is rated AA. At December 31, 2014 the investment portfolio fair value in our Australian operations was approximately $46 million. | |||||||||||||||||||||||||
The amortized cost and fair values of debt securities at December 31, 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 | ||||||||||||||||||||||||
31-Dec-14 | Cost | Value | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Due in one year or less | $ | 330,602 | $ | 330,982 | |||||||||||||||||||||
Due after one year through five years | 1,903,661 | 1,909,422 | |||||||||||||||||||||||
Due after five years through ten years | 1,063,679 | 1,069,433 | |||||||||||||||||||||||
Due after ten years | 350,774 | 356,531 | |||||||||||||||||||||||
3,648,716 | 3,666,368 | ||||||||||||||||||||||||
Asset-backed securities | 286,260 | 286,655 | |||||||||||||||||||||||
Residential mortgage-backed securities | 329,983 | 321,237 | |||||||||||||||||||||||
Commercial mortgage-backed securities | 276,215 | 275,278 | |||||||||||||||||||||||
Collateralized loan obligations | 61,340 | 60,076 | |||||||||||||||||||||||
Total at December 31, 2014 | $ | 4,602,514 | $ | 4,609,614 | |||||||||||||||||||||
At December 31, 2014 and 2013, the investment portfolio had gross unrealized losses of $30.5 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 | ||||||||||||||||||||
31-Dec-14 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 58,166 | $ | 138 | $ | 232,351 | $ | 4,992 | $ | 290,517 | $ | 5,130 | |||||||||||||
Obligations of U.S. states and political subdivisions | 166,408 | 1,066 | 114,465 | 1,695 | 280,873 | 2,761 | |||||||||||||||||||
Corporate debt securities | 816,555 | 5,259 | 243,208 | 4,776 | 1,059,763 | 10,035 | |||||||||||||||||||
Asset-backed securities | 54,491 | 80 | 11,895 | 60 | 66,386 | 140 | |||||||||||||||||||
Residential mortgage-backed securities | 24,168 | 34 | 263,002 | 8,966 | 287,170 | 9,000 | |||||||||||||||||||
Commercial mortgage-backed securities | 89,301 | 810 | 110,652 | 1,348 | 199,953 | 2,158 | |||||||||||||||||||
Collateralized loan obligations | - | - | 60,076 | 1,264 | 60,076 | 1,264 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | - | - | - | - | - | - | |||||||||||||||||||
Equity securities | 167 | 1 | 235 | 8 | 402 | 9 | |||||||||||||||||||
Total investment portfolio | $ | 1,209,256 | $ | 7,388 | $ | 1,035,884 | $ | 23,109 | $ | 2,245,140 | $ | 30,497 | |||||||||||||
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 December 31, 2014 were primarily caused by the difference in interest rates at December 31, 2014 compared to interest rates at the time of purchase. There were 423 and 571 securities in an unrealized loss position at December 31, 2014 and 2013, respectively. At December 31, 2014, the fair value as a percent of amortized cost of the securities in an unrealized loss position was 99% and approximately half of the securities in an unrealized loss position were backed by the U.S. Government. | |||||||||||||||||||||||||
We recognized other-than-temporary impairment (“OTTI”) losses in earnings of $0.1 million and $0.3 million during 2014 and 2013, respectively. During 2012 we recognized OTTI losses in earnings of $2.3 million, related to impairments on certain auction rate securities. | |||||||||||||||||||||||||
For the years ended December 31, 2014, 2013, and 2012, there were no credit losses recognized in earnings for which a portion of an OTTI loss was recognized in accumulated other comprehensive income (loss). | |||||||||||||||||||||||||
Net investment income is comprised of the following: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Fixed maturities | $ | 89,437 | $ | 82,168 | $ | 122,886 | |||||||||||||||||||
Equity securities | 227 | 229 | 200 | ||||||||||||||||||||||
Cash equivalents | 179 | 353 | 333 | ||||||||||||||||||||||
Other | 711 | 675 | 782 | ||||||||||||||||||||||
Investment income | 90,554 | 83,425 | 124,201 | ||||||||||||||||||||||
Investment expenses | (2,907 | ) | (2,686 | ) | (2,561 | ) | |||||||||||||||||||
Net investment income | $ | 87,647 | $ | 80,739 | $ | 121,640 | |||||||||||||||||||
The net realized investment gains (losses), including impairment losses, and change in net unrealized gains (losses) of investments are as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) on investments: | |||||||||||||||||||||||||
Fixed maturities | $ | 1,000 | $ | 3,274 | $ | 195,652 | |||||||||||||||||||
Equity securities | 356 | 1,068 | 487 | ||||||||||||||||||||||
Other | 1 | 1,389 | (730 | ) | |||||||||||||||||||||
Total net realized investment gains | $ | 1,357 | $ | 5,731 | $ | 195,409 | |||||||||||||||||||
Change in net unrealized gains (losses): | |||||||||||||||||||||||||
Fixed maturities | $ | 91,718 | $ | (126,020 | ) | $ | (78,604 | ) | |||||||||||||||||
Equity securities | 66 | (153 | ) | 58 | |||||||||||||||||||||
Other | - | - | - | ||||||||||||||||||||||
Total increase (decrease) in net unrealized gains/losses | $ | 91,784 | $ | (126,173 | ) | $ | (78,546 | ) | |||||||||||||||||
The gross realized gains, gross realized losses and impairment losses are as follows: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Gross realized gains | $ | 4,966 | $ | 11,043 | $ | 213,827 | |||||||||||||||||||
Gross realized losses | (3,465 | ) | (4,984 | ) | (16,108 | ) | |||||||||||||||||||
Impairment losses | (144 | ) | (328 | ) | (2,310 | ) | |||||||||||||||||||
Net realized gains on securities | $ | 1,357 | $ | 5,731 | $ | 195,409 | |||||||||||||||||||
We had $20.2 million and $20.3 million of investments at fair value on deposit with various states at December 31, 2014 and 2013, respectively, due to regulatory requirements of those state insurance departments. |
Fair_Value_Measurements
Fair Value Measurements | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Fair Value Measurements [Abstract] | |||||||||||||||||||||
Fair Value Measurements | 7 | Fair Value Measurements | |||||||||||||||||||
Assets measured at fair value included those listed, by hierarchy level, in the following tables as of December 31, 2014 and 2013: | |||||||||||||||||||||
Fair Value | Quoted Prices in | Significant | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | |||||||||||||||||||
Identical Assets | Observable Inputs | Inputs | |||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 346,775 | $ | 188,824 | $ | 157,951 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 855,142 | - | 853,296 | 1,846 | |||||||||||||||||
Corporate debt securities | 2,425,281 | - | 2,425,281 | - | |||||||||||||||||
Asset-backed securities | 286,655 | - | 286,655 | - | |||||||||||||||||
Residential mortgage-backed securities | 321,237 | - | 321,237 | - | |||||||||||||||||
Commercial mortgage-backed securities | 275,278 | - | 275,278 | - | |||||||||||||||||
Collateralized loan obligations | 60,076 | - | 60,076 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 39,170 | 39,170 | - | - | |||||||||||||||||
Total debt securities | 4,609,614 | 227,994 | 4,379,774 | 1,846 | |||||||||||||||||
Equity securities | 3,055 | 2,734 | - | 321 | |||||||||||||||||
Total investments | $ | 4,612,669 | $ | 230,728 | $ | 4,379,774 | $ | 2,167 | |||||||||||||
Real estate acquired (1) | $ | 12,658 | $ | - | $ | - | $ | 12,658 | |||||||||||||
-1 | Real estate acquired through claim settlement, which is held for sale, is reported in Other Assets on the consolidated balance sheets. | ||||||||||||||||||||
Fair Value | Quoted Prices in | Significant | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | |||||||||||||||||||
Identical Assets | Observable 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 sheets. | ||||||||||||||||||||
During the third quarter of 2014, we changed the classification of our U.S. government corporations and agencies securities from Level 1 to Level 2 within the fair value hierarchy. The fair value of our U.S. government corporations and agencies 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 within the fair value table as of December 31, 2013 has been revised to conform to the 2014 presentation, as we believe the most appropriate classification for these securities was Level 2 as of that date. | |||||||||||||||||||||
For assets and liabilities measured at fair value using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances for the years ended December 31, 2014 and 2013 is as follows: | |||||||||||||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | 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 | - | - | - | - | (4,129 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 42,247 | ||||||||||||||||
Sales | (607 | ) | - | - | (607 | ) | (38,740 | ) | |||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2014 | $ | 1,846 | $ | - | $ | 321 | $ | 2,167 | $ | 12,658 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2014 attributable to the change in unrealized losses on assets still held at December 31, 2014 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
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 | - | - | - | - | (4,959 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 39,188 | ||||||||||||||||
Sales | (737 | ) | (16,889 | ) | - | (17,626 | ) | (24,412 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2013 | $ | 2,423 | $ | - | $ | 321 | $ | 2,744 | $ | 13,280 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2013 attributable to the change in unrealized losses on assets still held at December 31, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Obligations of U.S. | |||||||||||||||||||||
States and Political | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
Subdivisions | Securities | Securities | Investments | Acquired | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2011 | $ | 114,226 | $ | 60,228 | $ | 321 | $ | 174,775 | $ | 1,621 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as realized investment gains (losses), net | (8,669 | ) | (3,129 | ) | - | (11,798 | ) | - | |||||||||||||
Included in earnings and reported as net impairment losses recognized in earnings | - | (2,310 | ) | - | (2,310 | ) | |||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (1,126 | ) | |||||||||||||||
Included in other comprehensive income | 5,630 | 733 | - | 6,363 | - | ||||||||||||||||
Purchases | 27 | - | - | 27 | 11,991 | ||||||||||||||||
Sales | (108,084 | ) | (38,408 | ) | - | (146,492 | ) | (9,023 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2012 | $ | 3,130 | $ | 17,114 | $ | 321 | $ | 20,565 | $ | 3,463 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2012 attributable to the change in unrealized losses on assets still held at December 31, 2012 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
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. | |||||||||||||||||||||
During 2013 we sold our remaining auction rate securities. At December 31, 2014, the majority of the $2 million balance of Level 3 securities is state premium tax credit investments. The state premium tax credit investments have an average maturity of less than 5 years, credit ratings of AA+ or higher, and their balance reflects their remaining scheduled payments discounted at an average annual rate of 7.3%. | |||||||||||||||||||||
Additional fair value disclosures related to our investment portfolio are included in Note 6 – “Investments.” Fair value disclosures related to our debt are included in Note 8 – “Debt.” |
Debt
Debt | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Debt [Abstract] | |||||||||||||||||||||
Debt | 8 | Debt | |||||||||||||||||||
5.375% Senior Notes – due November 2015 | |||||||||||||||||||||
At December 31, 2014 and 2013 we had outstanding $61.9 million and $82.9 million, respectively, of 5.375% Senior Notes due in November 2015. Interest on these notes is payable semi-annually in arrears on May 1 and November 1 each year. During the second quarter of 2013 we repurchased $17.2 million of those Senior Notes at par value. In addition, in February 2014, we repurchased an additional $20.9 million in par value at a cost slightly above par. Covenants in the Senior Notes include the requirement that there be no liens on the stock of the designated subsidiaries unless the Senior Notes are equally and ratably secured; that there be no disposition of the stock of designated subsidiaries unless all of the stock is disposed of for consideration equal to the fair market value of the stock; and that we and the designated subsidiaries preserve our corporate existence, rights and franchises unless we or any such subsidiary determines that such preservation is no longer necessary in the conduct of its business and that the loss thereof is not disadvantageous to the Senior Notes. A designated subsidiary is any of our consolidated subsidiaries which has shareholders’ equity of at least 15% of our consolidated shareholders’ equity. Further, the notes are subject to the indenture between us and the trustee that, among other terms, include provisions that would constitute an event of default under the indenture. Upon such a default, the trustee could accelerate the maturity of the notes independent of any action by holders of the Senior Notes. This description is not intended to be complete in all respect and is qualified in its entirety by the terms of the Senior Notes, including their covenants and events of default. We were in compliance with all covenants at December 31, 2014. | |||||||||||||||||||||
Interest payments on the Senior Notes were $3.6 million and $5.1 million for the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||||
5% Convertible Senior Notes – due May 2017 | |||||||||||||||||||||
At December 31, 2014 and 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 will mature on May 1, 2017. 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 Convertible Junior Debentures. Debt issuance costs are being amortized to interest expense over the contractual life of the 5% Notes. | |||||||||||||||||||||
The provisions of the 5% Notes are complex. Covenants in the 5% Notes include a requirement to notify holders in advance of certain events and that we and the designated subsidiaries (defined above) preserve our corporate existence, rights and franchises unless we or any such subsidiary determines that such preservation is no longer necessary in the conduct of its business and that the loss thereof is not disadvantageous to the 5% Notes. Further, the notes are subject to the indenture between us and the trustee that, among other terms, include provisions that would constitute an event of default under the indenture. Upon such a default, the trustee could accelerate the maturity of the notes independent of any action by holders of the 5% Notes. This description is not intended to be complete in all respect and is qualified in its entirety by the terms of the 5% Notes, including their covenants and events of default. We were in compliance with all covenants at December 31, 2014. | |||||||||||||||||||||
Interest payments on the 5% Notes were $17.3 million in each of the years ended December 31, 2014 and 2013. | |||||||||||||||||||||
2% Convertible Senior Notes – due April 2020 | |||||||||||||||||||||
At December 31, 2014 and 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. See Note 15 – “Shareholders’ Equity” for information regarding the use of such proceeds. 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 2% 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 Convertible Junior Debentures. Debt issuance costs will be 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. | |||||||||||||||||||||
The provisions of the 2% Notes are complex. Covenants in the 2% Notes include a requirement to notify holders in advance of certain events and that we and the designated subsidiaries (defined above) preserve our corporate existence, rights and franchises unless we or any such subsidiary determines that such preservation is no longer necessary in the conduct of its business and that the loss thereof is not disadvantageous to the 2% Notes. Further, the notes are subject to the indenture between us and the trustee that, among other terms, include provisions that would constitute an event of default under the indenture. Upon such a default, the trustee could accelerate the maturity of the notes independent of any action by holders of the 2% Notes. This description is not intended to be complete in all respect and is qualified in its entirety by the terms of the 2% Notes, including their covenants and events of default. We were in compliance with all covenants at December 31, 2014. | |||||||||||||||||||||
Interest payments on the 2% Notes were $10.0 million and $5.5 million for the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||||
9% Convertible Junior Subordinated Debentures – due April 2063 | |||||||||||||||||||||
At December 31, 2014 and 2013 we had outstanding $389.5 million principal amount of 9% Convertible Junior Subordinated Debentures due in 2063 (the “debentures”). 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. 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. | |||||||||||||||||||||
When interest on the debentures is deferred, we are required, not later than a specified time, to use reasonable commercial efforts to begin selling qualifying securities to persons who are not our affiliates. The specified time is one business day after we pay interest on the debentures that was not deferred, or if earlier, the fifth anniversary of the scheduled interest payment date on which the deferral started. Qualifying securities are common stock, certain warrants and certain non-cumulative perpetual preferred stock. The requirement to use such efforts to sell such securities is called the Alternative Payment Mechanism. | |||||||||||||||||||||
The net proceeds of Alternative Payment Mechanism sales are to be applied to the payment of deferred interest, including the compound portion. We cannot pay deferred interest other than from the net proceeds of Alternative Payment Mechanism sales, except at the final maturity of the debentures or at the tenth anniversary of the start of the interest deferral. The Alternative Payment Mechanism does not require us to sell common stock or warrants before the fifth anniversary of the interest payment date on which that deferral started if the net proceeds (counting any net proceeds of those securities previously sold under the Alternative Payment Mechanism) would exceed the 2% cap. The 2% cap is 2% of the average closing price of our common stock times the number of our outstanding shares of common stock. The average price is determined over a specified period ending before the issuance of the common stock or warrants being sold, and the number of outstanding shares is determined as of the date of our most recent publicly released financial statements. | |||||||||||||||||||||
We are not required to issue under the Alternative Payment Mechanism a total of more than 10 million shares of common stock, including shares underlying qualifying warrants. In addition, we may not issue under the Alternative Payment Mechanism qualifying preferred stock if the total net proceeds of all issuances would exceed 25% of the aggregate principal amount of the debentures. | |||||||||||||||||||||
The Alternative Payment Mechanism does not apply during any period between scheduled interest payment dates if there is a “market disruption event” that occurs over a specified portion of such period. Market disruption events include any material adverse change in domestic or international economic or financial conditions. | |||||||||||||||||||||
On April 1, 2013 we paid a deferred interest payment, including the compound interest that had accrued on a semi-annual basis at an annual rate of 9%, from an installment initially due October 1, 2012. 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. | |||||||||||||||||||||
The provisions of the debentures are complex. The description above is not intended to be complete in all respects. Moreover, that description is qualified in its entirety by the terms of the debentures, including their covenants and events of default. We were in compliance with all covenants at December 31, 2014. | |||||||||||||||||||||
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. | |||||||||||||||||||||
Interest payments on the debentures were $35.1 million and $53.4 million for the years ended December 31, 2014 and 2013, respectively. | |||||||||||||||||||||
All debt | |||||||||||||||||||||
The par value and fair value of our debt at December 31, 2014 and 2013 appears in the table below. | |||||||||||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||||||||||
Active Markets | Observable | Unobservable | |||||||||||||||||||
Total Fair | for Identical | Inputs | Inputs | ||||||||||||||||||
Par Value | Value | Assets (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Debt: | |||||||||||||||||||||
Senior Notes | $ | 61,953 | $ | 63,618 | $ | - | $ | 63,618 | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 387,997 | - | 387,997 | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 735,075 | - | 735,075 | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 500,201 | - | 500,201 | - | ||||||||||||||||
Total Debt | $ | 1,296,475 | $ | 1,686,891 | $ | - | $ | 1,686,891 | $ | - | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Debt: | |||||||||||||||||||||
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 values of our Senior Notes, Convertible Senior Notes, and Convertible Junior Debentures were determined using available pricing for these notes, debentures or similar instruments and they are considered Level 2 securities as described in Note 3 – “Summary of Significant Accounting Policies - Fair Value Measurements.” As of December 31, 2013, the fair values of our Senior Notes and Convertible Senior Notes were determined using publicly available trade information and they were considered Level 1 securities as described in Note 3 – “Summary of Significant Accounting Policies - 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 December 31, 2014, we had approximately $491 million in cash and investments at our holding company. The net unrealized losses on our holding company investment portfolio were approximately $2.5 million at December 31, 2014. The modified duration of the holding company investment portfolio, excluding cash and cash equivalents, was 2.9 years at December 31, 2014. |
Loss_Reserves
Loss Reserves | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Loss Reserves [Abstract] | |||||||||||||||||||||||||
Loss Reserves | 9 | Loss Reserves | |||||||||||||||||||||||
As described in Note 3 – “Summary of Significant Accounting Policies – Loss Reserves,” we establish reserves to recognize the estimated liability for losses and loss adjustment expenses 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. 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 which 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 each of the past three years: | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Reserve at beginning of year | $ | 3,061,401 | $ | 4,056,843 | $ | 4,557,512 | |||||||||||||||||||
Less reinsurance recoverable | 64,085 | 104,848 | 154,607 | ||||||||||||||||||||||
Net reserve at beginning of year | 2,997,316 | 3,951,995 | 4,402,905 | ||||||||||||||||||||||
Losses incurred: | |||||||||||||||||||||||||
Losses and LAE incurred in respect of default notices received in: | |||||||||||||||||||||||||
Current year | 596,436 | 898,413 | 1,494,133 | ||||||||||||||||||||||
Prior years (1) | (100,359 | ) | (59,687 | ) | 573,120 | ||||||||||||||||||||
Subtotal | 496,077 | 838,726 | 2,067,253 | ||||||||||||||||||||||
Losses paid: | |||||||||||||||||||||||||
Losses and LAE paid in respect of default notices received in: | |||||||||||||||||||||||||
Current year | 32,919 | 73,470 | 134,509 | ||||||||||||||||||||||
Prior years | 1,121,508 | 1,722,923 | 2,389,985 | ||||||||||||||||||||||
Reinsurance terminations (2) | - | (2,988 | ) | (6,331 | ) | ||||||||||||||||||||
Subtotal | 1,154,427 | 1,793,405 | 2,518,163 | ||||||||||||||||||||||
Net reserve at end of year | 2,338,966 | 2,997,316 | 3,951,995 | ||||||||||||||||||||||
Plus reinsurance recoverables | 57,841 | 64,085 | 104,848 | ||||||||||||||||||||||
Reserve at end of year | $ | 2,396,807 | $ | 3,061,401 | $ | 4,056,843 | |||||||||||||||||||
-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. See table below regarding prior year loss development. | ||||||||||||||||||||||||
-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. (See Note 11 – “Reinsurance”) | ||||||||||||||||||||||||
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 2014 compared to 2013, and in 2013 compared to 2012, 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 recently reported delinquencies. | |||||||||||||||||||||||||
The prior year development of the reserves in 2014, 2013 and 2012 is reflected in the table below. | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Prior year loss development: | |||||||||||||||||||||||||
Pool policy settlement (1) | $ | - | $ | - | $ | 267 | |||||||||||||||||||
(Decrease) increase in estimated claim rate on primary defaults | (43 | ) | 10 | 260 | |||||||||||||||||||||
Decrease in estimated severity on primary defaults | (35 | ) | (50 | ) | (70 | ) | |||||||||||||||||||
Change in estimates related to pool reserves, LAE reserves, reinsurance and other (2) | (22 | ) | (20 | ) | 116 | ||||||||||||||||||||
Total prior year loss development | $ | (100 | ) | $ | (60 | ) | $ | 573 | |||||||||||||||||
-1 | See below for a discussion of our settlement with Freddie Mac. | ||||||||||||||||||||||||
-2 | Includes approximately $100 million related to probable settlements regarding our claims paying practices in 2012 | ||||||||||||||||||||||||
The prior year loss development was based on the resolution of approximately 58%, 59% and 55% for the years ended December 31, 2014, 2013 and 2012, respectively of the prior year default inventory, as well as a re-estimation of amounts to be ultimately paid on defaults remaining in inventory and estimated incurred but not reported items from the end of the prior year. In 2014, we recognized favorable development on our estimated claim rate as we experienced a higher cure rate on prior year default inventory. In 2012, lower estimated rescission rates, as well as our experience on defaults that were 12 months or more delinquent increased our estimate of the claim rate. The decrease in the estimated severity in 2014, 2013 and 2012 was based on the resolution of the prior year default inventory. | |||||||||||||||||||||||||
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. | |||||||||||||||||||||||||
MGIC and Freddie Mac disagreed on the amount of the aggregate loss limit under certain pool insurance policies (the “Disputed Policies”). On December 1, 2012, an Agreement of Settlement, Compromise and Release (the “Settlement Agreement”) between MGIC, Freddie Mac and the FHFA became effective, settling their dispute regarding the Disputed Policies. Under the Settlement Agreement, MGIC is to pay Freddie Mac a total of $267.5 million in satisfaction of all obligations under the Disputed Policies. Of the total, $100 million was paid in December 2012, as required by the Settlement Agreement, and the remaining $167.5 million is being paid out in 48 equal monthly installments that began on January 2, 2013. | |||||||||||||||||||||||||
The liability associated with our estimate of premiums to be refunded on expected claim payments is accrued for separately at December 31, 2014 and 2013 and approximated $115 million and $131 million, respectively. Separate components of this liability are included in “Other liabilities” and “Premium deficiency reserve” on our consolidated balance sheet. | |||||||||||||||||||||||||
A rollforward of our primary default inventory for the years ended December 31, 2014, 2013 and 2012 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 by transfers of servicing between loan servicers. | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Default inventory at beginning of year | 103,328 | 139,845 | 175,639 | ||||||||||||||||||||||
New Notices | 88,844 | 106,823 | 133,232 | ||||||||||||||||||||||
Cures | (87,278 | ) | (104,390 | ) | (120,248 | ) | |||||||||||||||||||
Paids (including those charged to a deductible or captive) | (23,494 | ) | (34,738 | ) | (45,741 | ) | |||||||||||||||||||
Rescissions and denials | (1,306 | ) | (1,939 | ) | (3,037 | ) | |||||||||||||||||||
Items removed from inventory resulting from the Countrywide settlement on GSE loans | (193 | ) | (2,273 | ) | - | ||||||||||||||||||||
Default inventory at end of year | 79,901 | 103,328 | 139,845 | ||||||||||||||||||||||
Pool insurance default inventory decreased from 6,563 at December 31, 2013 to 3,797 at December 31, 2014. The pool insurance notice inventory was 8,594 at December 31, 2012. | |||||||||||||||||||||||||
The decrease in the primary default inventory experienced during 2014 and 2013 was generally across all markets and all book years. In 2014 and 2013, the percentage of loans in the inventory that had been in default for 12 or more consecutive months had decreased compared to the prior years. In 2014, the level of loans in inventory that had been in default for 12 or more consecutive months also decreased in relation to the total primary default inventory. 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 has been affected by our suspended rescissions discussed below. | |||||||||||||||||||||||||
Aging of the Primary Default Inventory | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Consecutive months in default | 15,319 | 19 | % | 18,941 | 18 | % | 23,282 | 17 | % | ||||||||||||||||
3 months or less | |||||||||||||||||||||||||
4 - 11 months | 19,710 | 25 | % | 24,514 | 24 | % | 34,688 | 25 | % | ||||||||||||||||
12 months or more | 44,872 | 56 | % | 59,873 | 58 | % | 81,875 | 58 | % | ||||||||||||||||
Total primary default inventory | 79,901 | 100 | % | 103,328 | 100 | % | 139,845 | 100 | % | ||||||||||||||||
Primary claims received inventory included in ending default inventory (1) | 4,746 | 6 | % | 6,948 | 7 | % | 11,731 | 8 | % | ||||||||||||||||
-1 | Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to loans that we believed would be included in a potential resolution. As of December 31, 2014, rescissions of coverage on approximately 1,425 loans had been voluntarily suspended. | ||||||||||||||||||||||||
The length of time 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 Primary Payments Delinquent | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
3 payments or less | 23,253 | 29 | % | 28,095 | 27 | % | 34,245 | 24 | % | ||||||||||||||||
4 - 11 payments | 19,427 | 24 | % | 24,605 | 24 | % | 34,458 | 25 | % | ||||||||||||||||
12 payments or more | 37,221 | 47 | % | 50,628 | 49 | % | 71,142 | 51 | % | ||||||||||||||||
Total primary default inventory | 79,901 | 100 | % | 103,328 | 100 | % | 139,845 | 100 | % | ||||||||||||||||
Claims paying practices | |||||||||||||||||||||||||
Our loss reserving methodology incorporates our estimates of future rescissions. A variance between ultimate actual rescission rates and our estimates, as a result of the outcome of litigation, settlements or other factors, could materially affect our losses. | |||||||||||||||||||||||||
The liability associated with our estimate of premiums to be refunded on expected future rescissions is accrued for separately. At December 31, 2014 and 2013 the estimate of this liability totaled $28 million and $15 million, respectively. Separate components of this liability are included in “Other liabilities” and “Premium deficiency reserve” on our consolidated balance sheets. 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 20 – “Litigation and Contingencies.” |
Premium_Deficiency_Reserve
Premium Deficiency Reserve | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Premium Deficiency Reserve [Abstract] | |||||||||||||||||||||||||
Premium Deficiency Reserve | 10 | Premium Deficiency Reserve | |||||||||||||||||||||||
Beginning in 2007, when we stopped writing Wall Street bulk business, we began to separately measure the performance of these transactions and established a premium deficiency reserve related to this business. The premium deficiency reserve reflects the present value of expected future losses and expenses that exceed the present value of expected future premiums and already established loss reserves. | |||||||||||||||||||||||||
The components of the premium deficiency reserve at December 31, 2014, 2013 and 2012 appear in the table below. | |||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Present value of expected future premium | $ | 387 | $ | 432 | $ | 445 | |||||||||||||||||||
Present value of expected future paid losses and expenses | (941 | ) | (1,101 | ) | (1,285 | ) | |||||||||||||||||||
Net present value of future cash flows | (554 | ) | (669 | ) | (840 | ) | |||||||||||||||||||
Established loss reserves | 530 | 621 | 766 | ||||||||||||||||||||||
Net deficiency | $ | (24 | ) | $ | (48 | ) | $ | (74 | ) | ||||||||||||||||
Discount rate utilized at December 31, | 2.1 | % | 1.6 | % | 1.3 | % | |||||||||||||||||||
Each quarter, we re-estimate the premium deficiency reserve on the remaining Wall Street bulk insurance in force. The premium deficiency reserve primarily changes from quarter to quarter as a result of two factors. First, it changes as the actual premiums, losses and expenses that were previously estimated are recognized. Each period such items are reflected in our financial statements as earned premium, losses incurred and expenses. The difference between the amount and timing of actual earned premiums, losses incurred and expenses and our previous estimates used to establish the premium deficiency reserves has an effect (either positive or negative) on that period’s results. Second, the premium deficiency reserve changes as our assumptions relating to the present value of expected future premiums, losses and expenses on the remaining Wall Street bulk insurance in force change. Changes to these assumptions also have an effect on that period’s results. | |||||||||||||||||||||||||
The decrease in the premium deficiency reserve for the years ended December 31, 2014, 2013 and 2012 was $24 million, $26 million, and $61 million, respectively, as shown in the tables below. The decrease represents the net result of actual premiums, losses and expenses as well as a net change in assumptions for these periods. The change in assumptions for 2014 and 2013 is primarily related to higher estimated ultimate premiums resulting principally from an increase in the projected persistency rate, offset in part by higher estimated ultimate losses resulting principally from an increase in the number of projected claims that will ultimately be paid. The change in assumptions for 2012 is primarily related to higher estimated ultimate losses resulting principally from an increase in the number of projected claims that will ultimately be paid. | |||||||||||||||||||||||||
The decrease in the premium deficiency reserve for the years ended December 31, 2014, 2013 and 2012 appears in the table below. | |||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Premium Deficiency Reserve at beginning of year | $ | (48 | ) | $ | (74 | ) | $ | (135 | ) | ||||||||||||||||
Paid claims and loss adjustment expenses | $ | 169 | $ | 214 | $ | 279 | |||||||||||||||||||
Decrease in loss reserves | (91 | ) | (145 | ) | (60 | ) | |||||||||||||||||||
Premium earned | (79 | ) | (96 | ) | (102 | ) | |||||||||||||||||||
Effects of present valuing on future premiums, losses and expenses | (2 | ) | (1 | ) | (1 | ) | |||||||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | (3 | ) | (28 | ) | 116 | ||||||||||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | 27 | 54 | (55 | ) | |||||||||||||||||||||
Premium Deficiency Reserve at end of year | $ | (24 | ) | $ | (48 | ) | $ | (74 | ) | ||||||||||||||||
-1 | A positive (negative) number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a redundancy (deficiency) of prior premium deficiency reserves. | ||||||||||||||||||||||||
Each quarter we perform a premium deficiency analysis on the portion of our book of business not covered by the premium deficiency reserve described above. As of December 31, 2014, the analysis concluded that there was no premium deficiency on such portion of our book of business. For the reasons discussed below, our analysis of any potential deficiency reserve is subject to inherent uncertainty and requires significant judgment by management. To the extent, in a future period, expected losses are higher or expected premiums are lower than the assumptions we used in our analysis, and we estimate that the present value of the expected future losses and expenses exceed the present value of expected future premiums and already established loss reserves, we could be required to record a premium deficiency reserve on this portion of our book of business in such period. | |||||||||||||||||||||||||
The calculation of premium deficiency reserves requires the use of significant judgments and estimates to determine the present value of future premium and present value of expected losses and expenses on our business. The calculation of future premium depends on, among other things, assumptions about persistency and repayment patterns on underlying loans. The calculation of expected losses and expenses depends on assumptions relating to severity of claims and claim rates on current defaults, and expected defaults in future periods. These assumptions also include an estimate of expected rescission activity. Similar to our loss reserve estimates, our estimates for premium deficiency reserves could be adversely affected by several factors, including a deterioration of regional or economic conditions leading to a reduction in borrowers’ income and thus their ability to make mortgage payments, and a drop in housing values that could expose us to greater losses. Assumptions used in calculating the deficiency reserves can also be affected by volatility in the current housing and mortgage lending industries. To the extent premium patterns and actual loss experience differ from the assumptions used in calculating the premium deficiency reserves, the differences between the actual results and our estimates will affect future period earnings and could be material. |
Reinsurance
Reinsurance | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Reinsurance [Abstract] | |||||||||||||
Reinsurance | 11 | Reinsurance | |||||||||||
MGIC has obtained both captive and non-captive reinsurance in the past. In a captive reinsurance agreement, the reinsurer is affiliated with the lender for whom MGIC provides mortgage insurance. | |||||||||||||
Since June 2005, various state and federal regulators have conducted investigations or requested information regarding captive mortgage reinsurance arrangements in which we participated, in part, in order to consider compliance with the Real Estate Settlement Procedures Act (“RESPA”) or similar state laws. In April 2013, the U.S. District Court for the Southern District of Florida approved a settlement between MGIC and the Consumer Financial Protection Bureau (“CFPB”) that resolved a federal investigation of MGIC’s participation in captive reinsurance arrangements in the mortgage insurance industry. The settlement concludes the investigation with respect to MGIC without the CFPB or the court making any findings of wrongdoing. Three other mortgage insurers agreed to similar settlements. As part of the settlements, MGIC and the 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 agreements 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 $45 million at December 31, 2014 which was supported by $198 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 December 31, 2014 and December 31, 2013 there was an additional $9 million and $23 million, respectively, of trust assets in captive agreements where there was no related reinsurance recoverable on loss reserves. Trust fund assets of $3.0 million were transferred to us as a result of captive terminations during 2013. | |||||||||||||
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. Early termination 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 had never been delinquent. The structure of the quota share reinsurance agreement remains the same, with the exception that the business written before April 1, 2013 has a 40% quota share. Under the Addendum, policies for which premium was received but unearned as of December 31, 2013 were ceded, which generated “Prepaid reinsurance premiums” of $23.9 million which has been reduced to $16.8 million at December 31, 2014. | |||||||||||||
We have accrued a profit commission receivable of $91.5 million and $2.4 million as of December 31, 2014 and 2013, respectively. This receivable could continue to 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. Recoverables under the agreement are supported by trust funds or letters of credit. | |||||||||||||
A summary of the combined quota share reinsurance agreement for 2014 and 2013 appears below. | |||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Ceded premiums written, net of profit commission | $ | 100,031 | $ | 49,672 | |||||||||
Ceded premiums earned, net of profit commission | 88,528 | 13,821 | |||||||||||
Ceded losses incurred | 15,163 | 176 | |||||||||||
Ceding commissions (1) | 37,833 | 10,408 | |||||||||||
-1 | Ceding commissons are reported within Other underwriting and operating expenses, net on the consolidated statements of operations. | ||||||||||||
The effect of all reinsurance agreements on premiums earned and losses incurred is as follows: | |||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Premiums earned: | |||||||||||||
Direct | $ | 950,973 | $ | 979,078 | $ | 1,065,663 | |||||||
Assumed | 1,653 | 2,074 | 2,425 | ||||||||||
Ceded | (108,255 | ) | (38,101 | ) | (34,918 | ) | |||||||
Net premiums earned | $ | 844,371 | $ | 943,051 | $ | 1,033,170 | |||||||
Losses incurred: | |||||||||||||
Direct | $ | 524,051 | $ | 863,871 | $ | 2,115,974 | |||||||
Assumed | 2,012 | 2,645 | 6,912 | ||||||||||
Ceded | (29,986 | ) | (27,790 | ) | (55,633 | ) | |||||||
Net losses incurred | $ | 496,077 | $ | 838,726 | $ | 2,067,253 | |||||||
Generally, reinsurance recoverables on primary loss reserves, paid losses and prepaid reinsurance premiums are supported by trust funds or letters of credit. As such, we have not established an allowance against these recoverables. | |||||||||||||
See Note 20 – “Litigation and Contingencies” for a discussion of requests or subpoenas for information regarding captive mortgage reinsurance arrangements. |
Other_Comprehensive_Income
Other Comprehensive Income | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Other Comprehensive Income [Abstract] | |||||||||||||||||||
Other Comprehensive Income | 12 | Other Comprehensive Income | |||||||||||||||||
Our other comprehensive income for the years ended December 31, 2014, 2013 and 2012 was as follows: | |||||||||||||||||||
2014 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | 91,782 | $ | (32,017 | ) | $ | 31,374 | $ | 91,139 | ||||||||||
Benefit plans adjustments | (52,112 | ) | 18,239 | (18,239 | ) | (52,112 | ) | ||||||||||||
Unrealized foreign currency translation adjustment | (4,067 | ) | 1,425 | - | (2,642 | ) | |||||||||||||
Other comprehensive income (loss) | $ | 35,603 | $ | (12,353 | ) | $ | 13,135 | $ | 36,385 | ||||||||||
2013 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | (126,175 | ) | $ | 43,732 | $ | (41,148 | ) | $ | (123,591 | ) | ||||||||
Benefit plans adjustments | 68,038 | (23,813 | ) | 23,813 | 68,038 | ||||||||||||||
Unrealized foreign currency translation adjustment | (21,563 | ) | 7,553 | - | (14,010 | ) | |||||||||||||
Other comprehensive income (loss) | $ | (79,700 | ) | $ | 27,472 | $ | (17,335 | ) | $ | (69,563 | ) | ||||||||
2012 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | (78,546 | ) | $ | 27,510 | $ | (27,623 | ) | $ | (78,659 | ) | ||||||||
Benefit plan adjustments | (1,221 | ) | 428 | (428 | ) | (1,221 | ) | ||||||||||||
Unrealized foreign currency translation adjustment | 2,452 | (859 | ) | - | 1,593 | ||||||||||||||
Other comprehensive income (loss) | $ | (77,315 | ) | $ | 27,079 | $ | (28,051 | ) | $ | (78,287 | ) | ||||||||
See Note 14 – “Income Taxes” for a discussion of the valuation allowance. | |||||||||||||||||||
A rollforward of accumulated other comprehensive income (loss) for the years ended December 31, 2014, 2013, and 2012 , including amounts reclassified from accumulated other comprehensive income (loss), are included in the table below. | |||||||||||||||||||
2014 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | Total | ||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | |||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||||
Other comprehensive income (loss) before reclassifications | 78,294 | (45,182 | ) | (4,067 | ) | 29,045 | |||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | (13,488 | )(1) | 6,930 | -2 | - | (6,558 | ) | ||||||||||||
Net current period other comprehensive income (loss) | 91,782 | (52,112 | ) | (4,067 | ) | 35,603 | |||||||||||||
Balance at December 31, 2014, before tax | 7,148 | (55,878 | ) | 7,117 | (41,613 | ) | |||||||||||||
Tax effect (3) | (64,699 | ) | 26,940 | (1,969 | ) | (39,728 | ) | ||||||||||||
Balance at December 31, 2014, net of tax | $ | (57,551 | ) | $ | (28,938 | ) | $ | 5,148 | $ | (81,341 | ) | ||||||||
2013 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | |||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | Total | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2012, before tax | $ | 41,541 | $ | (71,804 | ) | $ | 32,747 | $ | 2,484 | ||||||||||
Other comprehensive income (loss) before reclassifications | (112,667 | ) | 68,039 | (21,563 | ) | (66,191 | ) | ||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 13,508 | -1 | 1 | -2 | - | 13,509 | |||||||||||||
Net current period other comprehensive income (loss) | (126,175 | ) | 68,038 | (21,563 | ) | (79,700 | ) | ||||||||||||
Balance at December 31, 2013, before tax | (84,634 | ) | (3,766 | ) | 11,184 | (77,216 | ) | ||||||||||||
Tax effect (3) | (64,056 | ) | 26,940 | (3,394 | ) | (40,510 | ) | ||||||||||||
Balance at December 31, 2013, net of tax | $ | (148,690 | ) | $ | 23,174 | $ | 7,790 | $ | (117,726 | ) | |||||||||
2012 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | |||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | Total | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2011, before tax | $ | 120,087 | $ | (70,582 | ) | $ | 30,294 | $ | 79,799 | ||||||||||
Other comprehensive income (loss) before reclassifications | 22,710 | (2,296 | ) | 2,453 | 22,867 | ||||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 101,256 | -1 | (1,074 | ) | -2 | - | 100,182 | ||||||||||||
Net current period other comprehensive income (loss) | (78,546 | ) | (1,222 | ) | 2,453 | (77,315 | ) | ||||||||||||
Balance at December 31, 2012, before tax | 41,541 | (71,804 | ) | 32,747 | 2,484 | ||||||||||||||
Tax effect (3) | (66,640 | ) | 26,940 | (10,947 | ) | (50,647 | ) | ||||||||||||
Balance at December 31, 2012, net of tax | $ | (25,099 | ) | $ | (44,864 | ) | $ | 21,800 | $ | (48,163 | ) | ||||||||
-1 | During 2014, 2013 and 2012, net unrealized (losses) gains of ($13.5) million, $13.5 million and $101.3 million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains. | ||||||||||||||||||
-2 | For the years ended December 31, 2014, 2013 and 2012, other comprehensive income (loss) related to benefit plans of $6.9 million, $1 thousand, and ($1.1) million, respectively, was reclassified to the Consolidated Statements 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. |
Benefit_Plans
Benefit Plans | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Benefit Plans [Abstract] | |||||||||||||||||||||||||
Benefit Plans | 13 | Benefit Plans | |||||||||||||||||||||||
We have a non-contributory defined benefit pension plan covering substantially all domestic employees, as well as a supplemental executive retirement plan. We also offer both medical and dental benefits for retired domestic employees and their eligible spouses under a postretirement benefit plan. The following tables provide the components of aggregate annual net periodic benefit cost, changes in the benefit obligation and the funded status of the pension, supplemental executive retirement and other postretirement benefit plans as recognized in the consolidated balance sheets: | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Components of Net Periodic Benefit Cost for fiscal year ending | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/12 | 12/31/14 | 12/31/13 | 12/31/12 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Company Service Cost | $ | 8,565 | $ | 11,338 | $ | 9,662 | $ | 659 | $ | 812 | $ | 1,226 | |||||||||||||
2. Interest Cost | 15,987 | 15,289 | 16,481 | 653 | 618 | 1,144 | |||||||||||||||||||
3. Expected Return on Assets | (21,030 | ) | (20,144 | ) | (18,211 | ) | (4,648 | ) | (3,679 | ) | (3,162 | ) | |||||||||||||
4. Other Adjustments | - | - | - | - | - | - | |||||||||||||||||||
Subtotal | 3,522 | 6,483 | 7,932 | (3,336 | ) | (2,249 | ) | (792 | ) | ||||||||||||||||
5. Amortization of : | |||||||||||||||||||||||||
a. Net Transition Obligation/(Asset) | - | - | - | - | - | - | |||||||||||||||||||
b. Net Prior Service Cost/(Credit) | (930 | ) | 503 | 665 | (6,649 | ) | (6,649 | ) | (6,217 | ) | |||||||||||||||
c. Net Losses/(Gains) | 1,083 | 6,145 | 5,829 | (435 | ) | - | 797 | ||||||||||||||||||
Total Amortization | 153 | 6,648 | 6,494 | (7,084 | ) | (6,649 | ) | (5,420 | ) | ||||||||||||||||
6. Net Periodic Benefit Cost | 3,675 | 13,131 | 14,426 | (10,420 | ) | (8,898 | ) | (6,212 | ) | ||||||||||||||||
7. Cost of settlements or curtailments | 302 | - | - | - | - | - | |||||||||||||||||||
8. Total Expense for Year | $ | 3,977 | $ | 13,131 | $ | 14,426 | $ | (10,420 | ) | $ | (8,898 | ) | $ | (6,212 | ) | ||||||||||
Development of Funded Status | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Actuarial Value of Benefit Obligations | |||||||||||||||||||||||||
1.Measurement Date | 12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | |||||||||||||||||||||
2. Accumulated Benefit Obligation | $ | 366,440 | $ | 304,825 | $ | 18,225 | $ | 15,764 | |||||||||||||||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet | |||||||||||||||||||||||||
1. Projected Benefit Obligation | $ | (379,324 | ) | $ | (317,606 | ) | $ | (18,225 | ) | $ | (15,764 | ) | |||||||||||||
2. Plan Assets at Fair Value | 378,701 | 355,704 | 66,940 | 62,298 | |||||||||||||||||||||
3. Funded Status - Overfunded/Asset | N/A | $ | 38,098 | $ | 48,715 | $ | 46,534 | ||||||||||||||||||
4. Funded Status - Underfunded/Liability | (623 | ) | N/A | N/A | N/A | ||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Net Actuarial (Gain)/Loss | $ | 93,243 | $ | 49,925 | $ | (8,222 | ) | $ | (9,439 | ) | |||||||||||||||
2. Net Prior Service Cost/(Credit) | (3,853 | ) | (4,782 | ) | (25,289 | ) | (31,938 | ) | |||||||||||||||||
3. Net Transition Obligation/(Asset) | - | - | - | - | |||||||||||||||||||||
4. Total at Year End | $ | 89,390 | $ | 45,143 | $ | (33,511 | ) | $ | (41,377 | ) | |||||||||||||||
The amortization of gains and losses resulting from actual experience different from assumed experience or changes in assumptions including discount rates is included as a component of Net Periodic Benefit Cost/(Income) for the year. The gain or loss in excess of a 10% corridor is amortized by the average remaining service period of participating employees expected to receive benefits under the plan. | |||||||||||||||||||||||||
The changes in the projected benefit obligation are as follows: | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Projected Benefit/Accumulated Benefit Obligation | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Benefit Obligation at Beginning of Year | $ | 317,606 | $ | 362,657 | $ | 15,764 | $ | 16,284 | |||||||||||||||||
2. Company Service Cost | 8,565 | 11,338 | 659 | 812 | |||||||||||||||||||||
3. Interest Cost | 15,987 | 15,289 | 653 | 618 | |||||||||||||||||||||
4. Plan Participants' Contributions | - | - | 336 | 299 | |||||||||||||||||||||
5. Net Actuarial (Gain)/Loss due to Assumption Changes | 59,901 | (44,205 | ) | 2,276 | (1,414 | ) | |||||||||||||||||||
6. Net Actuarial (Gain)/Loss due to Plan Experience | (55 | ) | 1,353 | (855 | ) | 101 | |||||||||||||||||||
7. Benefit Payments from Fund (1) | (21,539 | ) | (22,497 | ) | (645 | ) | (871 | ) | |||||||||||||||||
8. Benefit Payments Directly by Company | (1,404 | ) | (275 | ) | - | (65 | ) | ||||||||||||||||||
9. Plan Amendments | (1 | ) | (6,054 | ) | - | - | |||||||||||||||||||
10. Other Adjustment | 264 | - | 37 | - | |||||||||||||||||||||
11. Benefit Obligation at End of Year | $ | 379,324 | $ | 317,606 | $ | 18,225 | $ | 15,764 | |||||||||||||||||
(1) In 2014, includes lump sum payments of $11.8 million from our pension plan to eligible participants, which were former employees with vested benefits. In 2013, includes lump sum payments of $13.8 million from our pension plan to eligible participants, which were former employees with vested benefits of $200 thousand or less. | |||||||||||||||||||||||||
In the fourth quarter of 2014, the Society of Actuaries released new mortality tables as a result of their detailed study on the future life expectancies of pension plan participants. We have used these new mortality tables in calculating our year-end 2014 retirement program obligations. If all pension plan participants elected to receive their pension benefits in monthly payments, the new tables would have increased year-end obligations by $23.2 million. However, based on our experience, we estimate that 75% of our active pension plan participants will elect to receive their pension benefits in a lump sum, which under the terms of the pension plan, are calculated based on mortality assumptions prescribed by the IRS, not the Society of Actuaries. The combined effect of the new Society of Actuaries mortality tables and the 75% lump-sum election assumption was a net increase in year-end obligations of $14.6 million. In addition, the benefit obligation will also change due to changes in the actuarial assumptions applied, as shown in the table below, to determine the outstanding liability. | |||||||||||||||||||||||||
The changes in the fair value of the net assets available for plan benefits are as follows: | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Plan Assets | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Fair Value of Plan Assets at Beginning of Year | $ | 355,704 | $ | 340,335 | $ | 62,298 | $ | 49,391 | |||||||||||||||||
2. Company Contributions | 9,504 | 10,275 | - | - | |||||||||||||||||||||
3. Plan Participants' Contributions | - | - | 336 | 299 | |||||||||||||||||||||
4. Benefit Payments from Fund | (21,539 | ) | (22,497 | ) | (645 | ) | (871 | ) | |||||||||||||||||
5. Benefit Payments paid directly by Company | (1,404 | ) | (275 | ) | - | (65 | ) | ||||||||||||||||||
6. Actual Return on Assets | 36,436 | 27,866 | 5,250 | 13,778 | |||||||||||||||||||||
7. Other Adjustment | - | - | (299 | ) | (234 | ) | |||||||||||||||||||
8. Fair Value of Plan Assets at End of Year | $ | 378,701 | $ | 355,704 | $ | 66,940 | $ | 62,298 | |||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Accumulated Other Comprehensive Income (AOCI) | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. AOCI in Prior Year | $ | 45,143 | $ | 108,436 | $ | (41,377 | ) | $ | (36,602 | ) | |||||||||||||||
2. Increase/(Decrease) in AOCI | |||||||||||||||||||||||||
a. Recognized during year - Prior Service (Cost)/Credit | 930 | (503 | ) | 6,649 | 6,649 | ||||||||||||||||||||
b. Recognized during year - Net Actuarial (Losses)/Gains | (1,083 | ) | (6,145 | ) | 435 | - | |||||||||||||||||||
c. Occurring during year - Prior Service Cost | (1 | ) | (6,054 | ) | - | - | |||||||||||||||||||
d. Occurring during year - Net Actuarial Losses/(Gains) | 44,703 | (50,574 | ) | 782 | (11,411 | ) | |||||||||||||||||||
f. Occuring during year - Net Settlement Losses/(Gains) | (302 | ) | - | - | - | ||||||||||||||||||||
e. Other adjustments | - | (17 | ) | - | (13 | ) | |||||||||||||||||||
3. AOCI in Current Year | $ | 89,390 | $ | 45,143 | $ | (33,511 | ) | $ | (41,377 | ) | |||||||||||||||
Amortizations Expected to be Recognized During Next Fiscal Year Ending | |||||||||||||||||||||||||
12/31/15 | 12/31/15 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Amortization of Net Transition Obligation/(Asset) | $ | - | $ | - | |||||||||||||||||||||
2. Amortization of Prior Service Cost/(Credit) | (846 | ) | (6,649 | ) | |||||||||||||||||||||
3. Amortization of Net Losses/(Gains) | 4,837 | (142 | ) | ||||||||||||||||||||||
The projected benefit obligations, net periodic benefit costs and accumulated postretirement benefit obligation for the plans were determined using the following weighted average assumptions. | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Actuarial Assumptions | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
Weighted-Average Assumptions Used to Determine | |||||||||||||||||||||||||
Benefit Obligations at year end | |||||||||||||||||||||||||
1. Discount Rate | 4.25 | % | 5.15 | % | 4 | % | 4.75 | % | |||||||||||||||||
2. Rate of Compensation Increase | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
Weighted-Average Assumptions Used to Determine | |||||||||||||||||||||||||
Net Periodic Benefit Cost for Year | |||||||||||||||||||||||||
1. Discount Rate | 5.15 | % | 4.25 | % | 4.75 | % | 3.85 | % | |||||||||||||||||
2. Expected Long-term Return on Plan Assets | 6 | % | 6 | % | 7.5 | % | 7.5 | % | |||||||||||||||||
3. Rate of Compensation Increase | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
Assumed Health Care Cost Trend Rates at year end | |||||||||||||||||||||||||
1. Health Care Cost Trend Rate Assumed for Next Year | N/A | N/A | 7 | % | 7 | % | |||||||||||||||||||
2. Rate to Which the Cost Trend Rate is Assumed to Decline (Ultimate Trend Rate) | N/A | N/A | 5 | % | 5 | % | |||||||||||||||||||
3. Year That the Rate Reaches the Ultimate Trend Rate | N/A | N/A | 2019 | 2018 | |||||||||||||||||||||
In selecting a discount rate, we performed a hypothetical cash flow bond matching exercise, matching our expected pension plan and postretirement medical plan cash flows, respectively, against a selected portfolio of high quality corporate bonds. The modeling was performed using a bond portfolio of noncallable bonds with at least $50 million outstanding. The average yield of these hypothetical bond portfolios was used as the benchmark for determining the discount rate. In selecting the expected long-term rate of return on assets, we considered the average rate of earnings expected on the classes of funds invested or to be invested to provide for the benefits of these plans. This included considering the trusts' targeted asset allocation for the year and the expected returns likely to be earned over the next 20 years. | |||||||||||||||||||||||||
The year-end asset allocations of the plans are as follows: | |||||||||||||||||||||||||
Other Postretirement | |||||||||||||||||||||||||
Pension Plan | Benefits | ||||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
Allocation of Assets at year end | |||||||||||||||||||||||||
1. Equity Securities | 22 | % | 43 | % | 100 | % | 100 | % | |||||||||||||||||
2. Debt Securities | 78 | % | 57 | % | 0 | % | 0 | % | |||||||||||||||||
3. Total | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||||
In accordance with fair value guidance, we applied the following fair value hierarchy in order to measure fair value of our benefit plan assets: | |||||||||||||||||||||||||
Level 1 – Quoted prices for identical instruments in active markets that we have the ability to access. Financial assets utilizing Level 1 inputs include equity securities, mutual funds, money market funds, certain U.S. Treasury securities and ETF’s. | |||||||||||||||||||||||||
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 include certain municipal, corporate and foreign bonds, obligations of U.S. government corporations and agencies, and pooled equity accounts. | |||||||||||||||||||||||||
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. There are no securities that utilize Level 3 inputs. | |||||||||||||||||||||||||
To determine the fair value of securities 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 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. In addition, on a quarterly basis, we perform quality controls over values received from the pricing source (the “Trustee”) which include comparing values to other independent pricing sources. In addition, we review annually the Trustee’s auditor’s report on internal controls in order to determine that their controls around valuing securities are operating effectively. We have not made any adjustments to the prices obtained from the independent sources. | |||||||||||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, the pension plan assets at fair value as of December 31, 2014 and 2013. | |||||||||||||||||||||||||
Assets at Fair Value as of December 31, 2014 | |||||||||||||||||||||||||
Pension Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 9,913 | $ | - | $ | - | $ | 9,913 | |||||||||||||||||
Corporate Bonds | - | 200,732 | - | 200,732 | |||||||||||||||||||||
U.S. Government Securities | 5,327 | 1,234 | - | 6,561 | |||||||||||||||||||||
Municipals | - | 65,214 | - | 65,214 | |||||||||||||||||||||
Foreign Bonds | - | 23,028 | - | 23,028 | |||||||||||||||||||||
ETF's | 5,636 | - | - | 5,636 | |||||||||||||||||||||
Pooled Equity Accounts | - | 67,617 | - | 67,617 | |||||||||||||||||||||
Total Assets at fair value | $ | 20,876 | $ | 357,825 | $ | - | $ | 378,701 | |||||||||||||||||
Assets at Fair Value as of December 31, 2013 | |||||||||||||||||||||||||
Pension Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 51,240 | $ | - | $ | - | $ | 51,240 | |||||||||||||||||
International Mutual Funds | 39,814 | - | - | 39,814 | |||||||||||||||||||||
Common Stocks | 60,332 | - | - | 60,332 | |||||||||||||||||||||
Corporate Bonds | - | 134,012 | - | 134,012 | |||||||||||||||||||||
U.S. Government Securities | 9,574 | 9,245 | - | 18,819 | |||||||||||||||||||||
Municipals | - | 33,402 | - | 33,402 | |||||||||||||||||||||
Foreign Bonds | - | 15,961 | - | 15,961 | |||||||||||||||||||||
Foreign Stocks | 2,124 | - | - | 2,124 | |||||||||||||||||||||
Total Assets at fair value | $ | 163,084 | $ | 192,620 | $ | - | $ | 355,704 | |||||||||||||||||
During the year ended December 31, 2014, we changed the classification of our U.S. government corporation and agency securities from Level 1 to Level 2 in the fair value hierarchy. The fair value of our U.S. government corporations and agencies, 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 to conform to the 2014 presentation, 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 year ended December 31, 2014. | |||||||||||||||||||||||||
The pension plan has implemented a strategy to reduce risk through the use of a targeted funded ratio. The liability driven component is key to the asset allocation. The liability driven component seeks to align the duration of the fixed income asset allocation with the expected duration of the plan liabilities or benefit payments. Overall asset allocation is dynamic and specifies target allocation weights and ranges based on the funded status. | |||||||||||||||||||||||||
An improvement in funding status results in the de-risking of the portfolio, allocating more funds to fixed income and less to equity. A decline in funding status would result in a higher allocation to equity. The maximum equity allocation is 40%. | |||||||||||||||||||||||||
The equity investments utilize combinations of mutual funds, ETFs, and pooled equity account structures. Within the equity investments; return seeking growth investments allocate to global quality growth and global low volatility investments and return seeking bridge investments allocate to enduring asset investments and durable company investments. | |||||||||||||||||||||||||
The fixed income objective is to preserve capital and to provide monthly cash flows for the payment of plan liabilities. Fixed income investments can include government, government agencies, corporate, mortgage backed, asset backed, municipal securities, and other classes of bonds. The duration of the fixed income portfolio has an objective of being within one year of the duration of the accumulated benefit obligation. The fixed income investments have an objective of a weighted average credit of A3/A-/A- by Moody’s, S&P, and Fitch, respectively. | |||||||||||||||||||||||||
The following table sets forth by level, within the fair value hierarchy, the postretirement plan assets at fair value as of December 31, 2014 and 2013. | |||||||||||||||||||||||||
Assets at Fair Value as of December 31, 2014 | |||||||||||||||||||||||||
Postretirement Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 50,710 | $ | - | $ | - | $ | 50,710 | |||||||||||||||||
International Mutual Funds | 16,230 | - | - | 16,230 | |||||||||||||||||||||
Total Assets at fair value | $ | 66,940 | $ | - | $ | - | $ | 66,940 | |||||||||||||||||
Assets at Fair Value as of December 31, 2013 | |||||||||||||||||||||||||
Postretirement Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 45,585 | $ | - | $ | - | $ | 45,585 | |||||||||||||||||
International Mutual Funds | 16,713 | - | - | 16,713 | |||||||||||||||||||||
Total Assets at fair value | $ | 62,298 | $ | - | $ | - | $ | 62,298 | |||||||||||||||||
Our postretirement plan portfolio is designed to achieve the following objectives over each market cycle and for at least 5 years: | |||||||||||||||||||||||||
· | Total return should exceed growth in the Consumer Price Index by 5.75% annually | ||||||||||||||||||||||||
· | Achieve competitive investment results | ||||||||||||||||||||||||
The primary focus in developing asset allocation ranges for the portfolio is the assessment of the portfolio's investment objectives and the level of risk that is acceptable to obtain those objectives. To achieve these goals the minimum and maximum allocation ranges for fixed income securities and equity securities are: | |||||||||||||||||||||||||
Minimum | Maximum | ||||||||||||||||||||||||
Equities (long only) | 70 | % | 100 | % | |||||||||||||||||||||
Real estate | 0 | % | 15 | % | |||||||||||||||||||||
Commodities | 0 | % | 10 | % | |||||||||||||||||||||
Fixed income/Cash | 0 | % | 10 | % | |||||||||||||||||||||
Given the long term nature of this portfolio and the lack of any immediate need for significant cash flow, it is anticipated that the equity investments will consist of growth stocks and will typically be at the higher end of the allocation ranges above. | |||||||||||||||||||||||||
Investment in international oriented funds is limited to a maximum of 30% of the equity range. The current international allocation is invested in two mutual funds with 4% of the equity allocation in a fund which has the objective of investing primarily in equity securities of emerging market countries, and 21% of the equity allocation in a fund investing in securities of companies based outside the United States. It invests in companies primarily based in Europe and the Pacific Basin, and primarily in equity investments although it may also hold cash, money market instruments, and fixed income securities depending on market conditions. | |||||||||||||||||||||||||
The following tables show the current and estimated future contributions and benefit payments. | |||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Company Contributions | |||||||||||||||||||||||||
12/31/14 | 12/31/14 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Company Contributions for the Year Ending: | |||||||||||||||||||||||||
1. Current | $ | 9,504 | $ | - | |||||||||||||||||||||
2. Current + 1 | 17,000 | - | |||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Benefit Payments (Total) | |||||||||||||||||||||||||
12/31/14 | 12/31/14 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Actual Benefit Payments for the Year Ending: | |||||||||||||||||||||||||
1. Current | $ | 22,942 | $ | 272 | |||||||||||||||||||||
Expected Benefit Payments for the Year Ending: | |||||||||||||||||||||||||
2. Current + 1 | 22,966 | 781 | |||||||||||||||||||||||
3. Current + 2 | 23,159 | 837 | |||||||||||||||||||||||
4. Current + 3 | 24,356 | 912 | |||||||||||||||||||||||
5. Current + 4 | 25,683 | 1,136 | |||||||||||||||||||||||
6. Current + 5 | 27,217 | 1,238 | |||||||||||||||||||||||
7. Current + 6 - 10 | 135,585 | 8,138 | |||||||||||||||||||||||
Health care sensitivities | |||||||||||||||||||||||||
For measurement purposes, a 7.0% health care trend rate was used for benefits for retirees before they reach age 65 for 2014. In 2015, the rate is assumed to be 7.0%, decreasing to 5.0% by 2019 and remaining at this level beyond. | |||||||||||||||||||||||||
Assumed health care cost trend rates have a significant effect on the amounts reported for the postretirement plan. A 1% point change in the health care trend rate assumption would have the following effects on other postretirement benefits: | |||||||||||||||||||||||||
1-Percentage | 1-Percentage | ||||||||||||||||||||||||
Point Increase | Point Decrease | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Effect on total service and interest cost components | $ | 259 | $ | (201 | ) | ||||||||||||||||||||
Effect on postretirement benefit obligation | 2,963 | (2,466 | ) | ||||||||||||||||||||||
We have a profit sharing and 401(k) savings plan for employees. At the discretion of the Board of Directors, we may make a contribution of up to 5% of each participant's eligible compensation. We provide a matching 401(k) savings contribution for employees' on their before-tax contributions at a rate of 80% of the first $1,000 contributed and 40% of the next $2,000 contributed. For employees hired after January 1, 2014, the match is 100% up to 4% contributed. We recognized expenses related to these plans of $5.0 million, $5.3 million and $3.1 million in 2014, 2013 and 2012, respectively. |
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Income Taxes | 14 | Income Taxes | |||||||||||
Net deferred tax assets and liabilities as of December 31, 2014 and 2013 are as follows: | |||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Total deferred tax assets | $ | 933,576 | $ | 1,043,477 | |||||||||
Total deferred tax liabilities | (33,789 | ) | (42,158 | ) | |||||||||
Net deferred tax asset before valuation allowance | 899,787 | 1,001,319 | |||||||||||
Valuation allowance | (902,289 | ) | (1,004,256 | ) | |||||||||
Net deferred tax liability | $ | (2,502 | ) | $ | (2,937 | ) | |||||||
The components of the net deferred tax liability as of December 31, 2014 and 2013 are as follows: | |||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Unearned premium reserves | $ | 12,296 | $ | (1,073 | ) | ||||||||
Benefit plans | (13,900 | ) | (26,111 | ) | |||||||||
Net operating loss | 845,616 | 915,378 | |||||||||||
Loss reserves | 23,069 | 36,236 | |||||||||||
Unrealized (appreciation) depreciation in investments | (2,800 | ) | 29,230 | ||||||||||
Mortgage investments | 15,346 | 13,450 | |||||||||||
Deferred compensation | 11,955 | 15,994 | |||||||||||
Premium deficiency reserves | 8,313 | 16,961 | |||||||||||
Other, net | (108 | ) | 1,254 | ||||||||||
Net deferred tax asset before valuation allowance | 899,787 | 1,001,319 | |||||||||||
Valuation allowance | (902,289 | ) | (1,004,256 | ) | |||||||||
Net deferred tax liability | $ | (2,502 | ) | $ | (2,937 | ) | |||||||
We review the need to maintain the 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, the expiration dates of the carryforwards, the cyclical nature of our operating results, and available tax planning strategies. Based on our analysis and the current 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 valuation allowance will be reversed in the foreseeable future. Specifically, if we continue to recognize meaningful levels of sustainable pre-tax income, it is likely that the valuation allowance would be reversed during 2015. 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: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Provision for (benefit from) income taxes before valuation allowance | $ | 91,607 | $ | (17,239 | ) | $ | (330,740 | ) | |||||
Change in valuation allowance | (88,833 | ) | 20,935 | 329,175 | |||||||||
Provision for (benefit from) income taxes | $ | 2,774 | $ | 3,696 | $ | (1,565 | ) | ||||||
The change in the valuation allowance that was included in other comprehensive income was a decrease of $13.1 million, an increase of $17.3 million, and an increase of $28.1 million for the years ended December 31, 2014, 2013 and 2012, respectively. The total valuation allowance as of December 31, 2014, December 31, 2013 and December 31, 2012 was $902.3 million, $1,004.2 million, and $966.0 million, respectively. | |||||||||||||
Giving full effect to the carryback of net operating losses for federal income tax purposes, we have approximately $2,417 million of net operating loss carryforwards on a regular tax basis and $1,529 million of net operating loss carryforwards for computing the alternative minimum tax as of December 31, 2014. Any unutilized carryforwards are scheduled to expire at the end of tax years 2029 through 2033. | |||||||||||||
The following summarizes the components of the provision for (benefit from) income taxes: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Current | $ | 2,391 | $ | 916 | $ | (4,251 | ) | ||||||
Deferred | 1 | 7 | 90 | ||||||||||
Other | 382 | 2,773 | 2,596 | ||||||||||
Provision for (benefit from) income taxes | $ | 2,774 | $ | 3,696 | $ | (1,565 | ) | ||||||
We paid (received) $1.3 million, $0.1 million, and ($7.0) million in federal income tax in 2014, 2013 and 2012, respectively. | |||||||||||||
The reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal statutory income tax rate | 35 | % | (35.0 | )% | (35.0 | ) % | |||||||
Valuation allowance | (34.9 | ) | 45.4 | 35.4 | |||||||||
Tax exempt municipal bond interest | (0.4 | ) | (3.7 | ) | (0.8 | ) | |||||||
Other, net | 1.4 | 1.3 | 0.2 | ||||||||||
Effective income tax rate | 1.1 | % | 8 | % | (0.2 | )% | |||||||
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 December 31, 2014, there would also be interest related to these matters of approximately $168.4 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. The Notices of Deficiency also reflect 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 filed a petition with the U.S. Tax Court contesting most of the IRS' proposed adjustments reflected in the Notices of Deficiency and the IRS has filed an answer to our petition which continues to assert their claim. Litigation to resolve our dispute with the IRS 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. 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 December 31, 2014, those state taxes and interest would approximate $47.4 million. In addition, there could also be state tax penalties. Our total amount of unrecognized tax benefits as of December 31, 2014 is $106.2 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 March 2012, we received a Revenue Agent’s Report from the IRS related to the examination of our federal income tax returns for the years 2008 and 2009. In January 2013, we received a Revenue Agent’s Report from the IRS related to the examination of our federal income tax return for the year 2010. 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 these examinations had no material effect on the financial statements. | |||||||||||||
Under current guidance, when evaluating a tax position for recognition and measurement, an entity shall presume that the tax position will be examined by the relevant taxing authority that has full knowledge of all relevant information. The interpretation adopts a benefit recognition model with a two-step approach, a more-likely-than-not threshold for recognition and derecognition, and a measurement attribute that is the greatest amount of benefit that is cumulatively greater than 50% likely of being realized. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Balance at beginning of year | $ | 105,366 | $ | 104,550 | $ | 110,080 | |||||||
Additions based on tax positions related to the current year | - | - | - | ||||||||||
Additions for tax positions of prior years | 864 | 816 | 511 | ||||||||||
Reductions for tax positions of prior years | - | - | (4,041 | ) | |||||||||
Settlements | - | - | (2,000 | ) | |||||||||
Balance at end of year | $ | 106,230 | $ | 105,366 | $ | 104,550 | |||||||
The total amount of the unrecognized tax benefits, related to our aforementioned REMIC issue, that would affect our effective tax rate is $93.6 million. We recognize interest accrued and penalties related to unrecognized tax benefits in income taxes. During 2014, we recognized $0.8 million in interest. As of December 31, 2014 and 2013, we had $26.9 million and $26.1 million of accrued interest related to uncertain tax positions, respectively. The statute of limitations related to the consolidated federal income tax return is closed for all years prior to 2000. It is reasonably possible that our 2000-2007 federal tax case will be resolved, other than through litigation. If it is resolved under terms similar to our previous settlement agreement, our total unrecognized tax benefits would be reduced by $106.2 million during 2015. After taking into account prior payments and the effect of available net operating loss carrybacks, any net cash outflows would approximate $25 million. |
Shareholders_Equity
Shareholders' Equity | 12 Months Ended | |
Dec. 31, 2014 | ||
Shareholders' Equity [Abstract] | ||
Shareholders' Equity | 15 | 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 April 2012, we amended our Articles of Incorporation to increase our authorized common stock from 460 million shares to 680 million 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 8 – “Debt.” | ||
In March 2013 we contributed $800 million to MGIC to increase its capital as discussed in Note 17 – “Statutory Capital.” We intend to use the remaining net proceeds from the offerings for general corporate purposes, which may include further increasing the capital of MGIC and other subsidiaries and improving liquidity by providing funds for debt service. | ||
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. | ||
We have 28.9 million authorized shares reserved for conversion under our convertible debentures and 97.6 million authorized shares reserved for conversion under our convertible senior notes. (See Note 8 – “Debt”) |
Dividend_Restrictions
Dividend Restrictions | 12 Months Ended | |
Dec. 31, 2014 | ||
Dividend Restrictions [Abstract] | ||
Dividend Restrictions | 16 | Dividend Restrictions |
In the fourth quarter of 2008, our holding company suspended the payment of dividends to shareholders. | ||
The senior notes, convertible senior notes and convertible debentures, discussed in Note 8 – “Debt”, are obligations of MGIC Investment Corporation, our holding company, and not of its subsidiaries. Our holding company has no material sources of cash inflows other than investment income, dividends from subsidiaries and capital raised in the public markets. MGIC is the principal source of dividend-paying capacity. Since 2008, MGIC has not paid any dividends to our holding company. Through 2015, MGIC cannot pay any dividends to our holding company without approval from the OCI and the GSEs. | ||
Our insurance subsidiaries are subject to state insurance regulations as to maintenance of policyholders' surplus and payment of dividends. The maximum amount of dividends that the insurance subsidiaries may pay in any twelve-month period without regulatory approval by the Office of the Commissioner of Insurance of the State of Wisconsin (the “OCI”) is the lesser of adjusted statutory net income or 10% of statutory policyholders' surplus as of the preceding calendar year end. Adjusted statutory net income is defined for this purpose to be the greater of statutory net income, net of realized investment gains, for the calendar year preceding the date of the dividend or statutory net income, net of realized investment gains, for the three calendar years preceding the date of the dividend less dividends paid within the first two of the preceding three calendar years. |
Statutory_Capital
Statutory Capital | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Statutory Capital [Abstract] | |||||||||||||
Statutory Capital | 17 | Statutory Capital | |||||||||||
Accounting Principles | |||||||||||||
The accounting principles used in determining statutory financial amounts differ from GAAP, primarily for the following reasons: | |||||||||||||
Under statutory accounting practices, including practice prescribed by the OCI, mortgage guaranty insurance companies are required to maintain contingency loss reserves equal to 50% of premiums earned. Such amounts cannot be withdrawn for a period of ten years except as permitted by insurance regulations. With regulatory approval a mortgage guaranty insurance company may make early withdrawals from the contingency reserve when incurred losses exceed 35% of net premiums earned in a calendar year. Changes in contingency loss reserves impact the statutory statement of operations. Contingency loss reserves are not reflected as liabilities under GAAP and changes in contingency loss reserves do not impact the GAAP statements of operations. A premium deficiency reserve that may be recorded on a GAAP basis when the present value of expected future losses and expenses exceeds the present value of expected future premiums and already established loss reserves, may not be recorded on a statutory basis if the present value of expected future premiums and already established loss reserves and statutory contingency reserves, exceeds the present value of expected future losses and expenses. On a GAAP basis, when calculating a premium deficiency reserve policies are grouped based on how they are acquired, serviced and measured. On a statutory basis, a premium deficiency reserve is calculated on all policies in force. | |||||||||||||
Under statutory accounting practices, insurance policy acquisition costs are charged against operations in the year incurred. Under GAAP, these costs are deferred and amortized as the related premiums are earned commensurate with the expiration of risk. | |||||||||||||
Under statutory accounting practices, purchases of tax and loss bonds are accounted for as investments. Under GAAP, purchases of tax and loss bonds are recorded as payments of current income taxes. | |||||||||||||
Under statutory accounting practices, changes in deferred tax assets and liabilities are recognized as a separate component of gains and losses in statutory surplus. Under GAAP, changes in deferred tax assets and liabilities are recorded on the statement of operations as a component of the (benefit) provision for income tax. | |||||||||||||
Under statutory accounting practices, fixed maturity investments are generally valued at amortized cost. Under GAAP, those investments which we do not have the ability and intent to hold to maturity are considered to be available-for-sale and are recorded at fair value, with the unrealized gain or loss recognized, net of tax, as an increase or decrease to shareholders' equity. | |||||||||||||
Under statutory accounting practices, certain assets, including certain deferred tax assets, designated as non-admitted assets, are charged directly against statutory surplus. Such assets are reflected on the GAAP financial statements. | |||||||||||||
The statutory net income, surplus and the contingency reserve liability of the insurance subsidiaries of our holding company, as well as the surplus contributions made to MGIC and other insurance subsidiaries and dividends paid by MGIC to us, are shown in the tables below. The surplus amounts included below are the combined surplus of our insurance operations as utilized in our risk-to-capital calculations. | |||||||||||||
Year Ended | Net income | Contingency | |||||||||||
December 31, | (loss) | Surplus | Reserve | ||||||||||
(In thousands) | |||||||||||||
2014 | $ | 13,203 | $ | 1,585,164 | $ | 318,247 | |||||||
2013 | (8,046 | ) | 1,584,121 | 18,558 | |||||||||
2012 | (902,878 | ) | 748,592 | 6,430 | |||||||||
Additions to the | |||||||||||||
Additions to the | surplus of other insurance | ||||||||||||
Year Ended | surplus of MGIC from | subsidiaries from | Dividends paid by MGIC | ||||||||||
December 31, | parent company funds | parent company funds | to the parent company | ||||||||||
(In thousands) | |||||||||||||
2014 | $ | - | $ | - | $ | - | |||||||
2013 | 800,000 | - | - | ||||||||||
2012 | 100,000 | - | - | ||||||||||
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. | |||||||||||||
At December 31, 2014, MGIC’s preliminary risk-to-capital ratio was 14.6 to 1, below the maximum allowed by the jurisdictions with State Capital Requirements and its policyholder position was $673 million above the required MPP of $1.0 billion. In 2013, we entered into a quota share reinsurance agreement with a group of unaffiliated reinsurers that reduced our risk-to-capital ratio. 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 reinsurance agreement, without penalty. At this time, we expect MGIC to continue to comply with the current State Capital Requirements; however, you should read the rest of these financial statement footnotes for information about matters that could negatively affect such compliance. | |||||||||||||
At December 31, 2014, the preliminary risk-to-capital ratio of our combined insurance operations (which includes reinsurance affiliates) was 16.4 to 1. Reinsurance agreements 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 agreements 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 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. While we believe MGIC has sufficient claims paying resources to meet its claim obligations on its insurance in force on a timely basis, you should read the rest of these financial statement footnotes for information about matters that could negatively affect MGIC’s claims paying resources. | |||||||||||||
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 $138 million were included in MGIC’s statutory capital at December 31, 2014 and 2013 and deferred tax assets of $63 million were included in MGIC’s statutory capital at December 31, 2012. | |||||||||||||
See Note 1 – “Nature of Business – Capital” for additional information regarding the capital standards of the GSEs. |
Sharebased_Compensation_Plans
Share-based Compensation Plans | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Share-based Compensation Plans [Abstract] | |||||||||||||
Share-based Compensation Plans | 18 | Share-based Compensation Plans | |||||||||||
We have certain share-based compensation plans. Under the fair value method, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period which generally corresponds to the vesting period. The fair value of awards classified as liabilities is remeasured at each reporting period until the award is settled. Awards under our plans generally vest over periods ranging from one to three years. | |||||||||||||
We have an omnibus incentive plan that was adopted in May 2011. The purpose of the plan is to motivate and incent performance by, and to retain the services of, key employees and non-employee directors through receipt of equity-based and other incentive awards under the plan. The maximum number of shares of stock that can be awarded under the plan is 7.0 million. Awards issued under the plan that are subsequently forfeited will not count against the limit on the maximum number of shares that may be issued under the plan. In addition, shares used for income tax withholding or used for payment of the exercise price of an option will not be counted against such limit. The plan provides for the award of stock options, stock appreciation rights, restricted stock and restricted stock units, as well as cash incentive awards. No awards may be granted after May 5, 2021 under the plan. The vesting provisions of options, restricted stock and restricted stock units are determined at the time of grant. Shares issued under the plan are treasury shares if available, otherwise they will be newly issued shares. | |||||||||||||
The compensation cost that has been charged against income for share-based plans was $9.2 million, $6.6 million, and $8.6 million for the years ended December 31, 2014, 2013 and 2012, respectively. The related income tax benefit, before valuation allowance, recognized for share-based plans was $3.2 million, $2.3 million, and $3.0 million for the years ended December 31, 2014, 2013 and 2012, respectively. See Note 14 – “Income Taxes” for a discussion of our valuation allowance. | |||||||||||||
There have been no options granted since 2004, and no options exercised since 2007. At December 31, 2013, all 529,800 options outstanding were exercisable at a price of $68.20 each. All of these options expired in January 2014 without being exercised. | |||||||||||||
A summary of restricted stock or restricted stock unit (collectively called “restricted stock”) activity during 2014 is as follows: | |||||||||||||
Weighted | |||||||||||||
Average | |||||||||||||
Grant Date | |||||||||||||
Fair Market | |||||||||||||
Value | Shares | ||||||||||||
Restricted stock outstanding at December 31, 2013 | $ | 5.15 | 3,622,707 | ||||||||||
Granted | 8.43 | 1,804,800 | |||||||||||
Vested | 5.66 | (1,368,234 | ) | ||||||||||
Forfeited | 8.44 | (206,882 | ) | ||||||||||
Restricted stock outstanding at December 31, 2014 | $ | 6.33 | 3,852,391 | ||||||||||
At December 31, 2014, the 3.9 million shares of restricted stock outstanding consisted of 2.9 million shares that are subject to performance conditions (“performance shares”) and 1.0 million shares that are subject only to service conditions (“time vested shares”). The weighted-average grant date fair value of restricted stock granted during 2013 and 2012 was $2.75 and $3.97, respectively. The fair value of restricted stock granted is the closing price of the common stock on the New York Stock Exchange on the date of grant. The total fair value of restricted stock vested during 2014, 2013 and 2012 was $12.1 million, $4.3 million, and $6.9 million, respectively. | |||||||||||||
As of December 31, 2014, there was $12.8 million of total unrecognized compensation cost related to non-vested share-based compensation agreements granted under the plans. Of this total, $9.9 million of unrecognized compensation costs relate to performance shares and $2.9 million relates to time vested shares. A portion of the unrecognized costs associated with the performance shares may or may not be recognized in future periods, depending upon whether or not the performance and service conditions are met. The cost associated with the time vested shares is expected to be recognized over a weighted-average period of 1.7 years. | |||||||||||||
In 2011, we granted 449,350 shares of restricted stock units that were to be settled as cash payments over the vesting period under our 2002 stock incentive plan. As of December 31, 2014, all shares granted under this award had either vested or been forfeited. A summary of activity related to these restricted share units for the years ended December 31, 2014, 2013 and 2012 is as follows: | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
Outstanding at beginning of year | 144,146 | 294,782 | 443,950 | ||||||||||
Granted | - | - | - | ||||||||||
Vested | (144,146 | ) | (147,368 | ) | (147,968 | ) | |||||||
Forfeited | - | (3,268 | ) | (1,200 | ) | ||||||||
Outstanding at end of year | - | 144,146 | 294,782 | ||||||||||
Cash payments at vesting (in millions) | $ | 1.2 | $ | 0.4 | 0.6 | ||||||||
At December 31, 2014, 2.3 million shares were available for future grant under the 2011 omnibus incentive plan. |
Leases
Leases | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Leases [Abstract] | |||||
Leases | 19 | Leases | |||
We lease certain office space as well as data processing equipment and autos under operating leases that expire during the next seven years. Generally, rental payments are fixed. | |||||
Total rental expense under operating leases was $2.8 million, $4.6 million, and $4.8 million in 2014, 2013 and 2012, respectively. | |||||
At December 31, 2014, minimum future operating lease payments are as follows (in thousands): | |||||
2015 | 1,041 | ||||
2016 | 1,000 | ||||
2017 | 467 | ||||
2018 | 231 | ||||
2019 and thereafter | 497 | ||||
Total | $ | 3,236 |
Litigation_and_Contingencies
Litigation and Contingencies | 12 Months Ended | |
Dec. 31, 2014 | ||
Litigation and Contingencies [Abstract] | ||
Litigation and Contingencies | 20 | 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 2014, curtailments reduced our average claim paid by approximately 5.8% and 6.7%, 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 2014, rescissions mitigated our paid losses by approximately $0.3 billion, $135 million and $97 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 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 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 in effect prior to October 1, 2014, 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, and under our master policy effective October 1, 2014, such proceedings may be brought up to two years from the date of the notice of rescission. In a few jurisdictions there is a longer time to bring such proceedings. | ||
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. | ||
The estimated impact of the Agreements and other probable settlements have been recorded in our financial statements. The estimated impact that we recorded for probable settlements is our best estimate of our loss from these matters. We estimate that the maximum exposure above the best estimate provision we recorded is $626 million, of which about 60% is related to claims paying practices subject to the Agreement with CHL and the previously disclosed curtailment matters 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 $16 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. 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. Seven of those cases had been dismissed prior to February 2015 without any further opportunity to appeal. Of the remaining five cases, three were dismissed with prejudice in February 2015 pursuant to stipulations of dismissal from the plaintiffs, and the remaining two cases are expected to be dismissed with prejudice in connection with plaintiffs' stipulations in such cases. 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 agreements 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 agreements 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 agreements 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 related contract underwriting remedy expense was approximately $5 million and $27 million for the years ended December 31, 2013 and 2012, respectively. The underwriting remedy expense for 2014 was approximately $4 million, but may increase in the future. | ||
See Note 14 – “Income Taxes” for a description of federal income tax contingencies. |
Unaudited_Quarterly_Financial_
Unaudited Quarterly Financial Data | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Unaudited Quarterly Financial Data [Abstract] | |||||||||||||||||||||
Unaudited Quarterly Financial Data | 21 | Unaudited Quarterly Financial Data | |||||||||||||||||||
Quarter | Full | ||||||||||||||||||||
2014:00:00 | First | Second | Third | Fourth | Year | ||||||||||||||||
(In thousands, except share data) | |||||||||||||||||||||
Net premiums earned | $ | 214,261 | $ | 207,486 | $ | 209,035 | $ | 213,589 | $ | 844,371 | |||||||||||
Investment income, net of expenses | 20,156 | 21,180 | 22,355 | 23,956 | 87,647 | ||||||||||||||||
Realized (losses) gains | (231 | ) | 522 | 632 | 434 | 1,357 | |||||||||||||||
Other revenue | 896 | 2,048 | 3,093 | 2,385 | 8,422 | ||||||||||||||||
Loss incurred, net | 122,608 | 141,141 | 115,254 | 117,074 | 496,077 | ||||||||||||||||
Underwriting and other expenses, net | 51,766 | 43,455 | 47,595 | 48,181 | 190,997 | ||||||||||||||||
Provision for income tax | 726 | 1,118 | 249 | 681 | 2,774 | ||||||||||||||||
Net income | 59,982 | 45,522 | 72,017 | 74,428 | 251,949 | ||||||||||||||||
Income per share (a) (b): | |||||||||||||||||||||
Basic | 0.18 | 0.13 | 0.21 | 0.22 | 0.74 | ||||||||||||||||
Diluted | 0.15 | 0.12 | 0.18 | 0.19 | 0.64 | ||||||||||||||||
Quarter | Full | ||||||||||||||||||||
2013:00:00 | First | Second | Third | Fourth | Year | ||||||||||||||||
(In thousands, except share data) | |||||||||||||||||||||
Net premiums earned | $ | 247,059 | $ | 237,777 | $ | 231,857 | $ | 226,358 | $ | 943,051 | |||||||||||
Investment income, net of expenses | 18,328 | 20,883 | 20,250 | 21,278 | 80,739 | ||||||||||||||||
Realized gains (losses) | 1,259 | 2,485 | (139 | ) | 2,126 | 5,731 | |||||||||||||||
Other revenue | 2,539 | 2,715 | 2,481 | 2,179 | 9,914 | ||||||||||||||||
Loss incurred, net | 266,208 | 196,274 | 180,189 | 196,055 | 838,726 | ||||||||||||||||
Underwriting and other expenses, net | 74,768 | 54,221 | 61,810 | 56,062 | 246,861 | ||||||||||||||||
Provision for income tax | 1,139 | 990 | 336 | 1,231 | 3,696 | ||||||||||||||||
Net (loss) income | (72,930 | ) | 12,375 | 12,114 | (1,407 | ) | (49,848 | ) | |||||||||||||
(Loss) income per share (a): | |||||||||||||||||||||
Basic | (0.31 | ) | 0.04 | 0.04 | (0.00 | ) | (0.16 | ) | |||||||||||||
Diluted | (0.31 | ) | 0.04 | 0.04 | (0.00 | ) | (0.16 | ) | |||||||||||||
(a) | Due to the use of weighted average shares outstanding when calculating earnings per share, the sum of the quarterly per share data may not equal the per share data for the year. | ||||||||||||||||||||
(b) | In periods where convertible debt instruments are dilutive to earnings per share the “if-converted” method of computing diluted EPS requires an interest expense adjustment, net of tax, to net income available to shareholders. This adjustment has not been reflected in the Unaudited Quarterly Financial Data presented. See Note 3 – “Summary of Significant Accounting Policies” for further discussion. |
SCHEDULE_ISUMMARY_OF_INVESTMEN
SCHEDULE I-SUMMARY OF INVESTMENTS-OTHER THAN INVESTMENTS IN RELATED PARTIES | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
SCHEDULE I-SUMMARY OF INVESTMENTS-OTHER THAN INVESTMENTS IN RELATED PARTIES [Abstract] | |||||||||||||
SCHEDULE I-SUMMARY OF INVESTMENTS-OTHER THAN INVESTMENTS IN RELATED PARTIES | MGIC INVESTMENT CORPORATION | ||||||||||||
SCHEDULE I — SUMMARY OF INVESTMENTS - | |||||||||||||
OTHER THAN INVESTMENTS IN RELATED PARTIES | |||||||||||||
31-Dec-14 | |||||||||||||
Type of Investment | Amortized | Fair Value | Amount at | ||||||||||
Cost | which | ||||||||||||
shown in the | |||||||||||||
balance | |||||||||||||
sheet | |||||||||||||
(In thousands) | |||||||||||||
Fixed maturities: | |||||||||||||
Bonds: | |||||||||||||
United States Government and government agencies and authorities | $ | 349,153 | $ | 346,775 | $ | 346,775 | |||||||
States, municipalities and political subdivisions | 844,942 | 855,142 | 855,142 | ||||||||||
Foreign governments | 35,630 | 39,170 | 39,170 | ||||||||||
Public utilities | 214,179 | 215,048 | 215,048 | ||||||||||
Asset-backed securities | 286,260 | 286,655 | 286,655 | ||||||||||
Collateralized loan obligations | 61,340 | 60,076 | 60,076 | ||||||||||
Mortgage-backed | 606,198 | 596,515 | 596,515 | ||||||||||
All other corporate bonds | 2,204,812 | 2,210,233 | 2,210,233 | ||||||||||
Total fixed maturities | 4,602,514 | 4,609,614 | 4,609,614 | ||||||||||
Equity securities: | |||||||||||||
Common stocks: | |||||||||||||
Industrial, miscellaneous and all other | 3,003 | 3,055 | 3,055 | ||||||||||
Total equity securities | 3,003 | 3,055 | 3,055 | ||||||||||
Total investments | $ | 4,605,517 | $ | 4,612,669 | $ | 4,612,669 |
SCHEDULE_IICONDENSED_FINANCIAL
SCHEDULE II-CONDENSED FINANCIAL INFORMATION OF REGISTRANT | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
SCHEDULE II-CONDENSED FINANCIAL INFORMATION OF REGISTRANT [Abstract] | |||||||||||||
SCHEDULE II-CONDENSED FINANCIAL INFORMATION OF REGISTRANT | MGIC INVESTMENT CORPORATION | ||||||||||||
SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT | |||||||||||||
CONDENSED BALANCE SHEETS | |||||||||||||
PARENT COMPANY ONLY | |||||||||||||
December 31, 2014 and 2013 | |||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
ASSETS | |||||||||||||
Fixed maturities (amortized cost, 2014 – $482,629; 2013 – $548,528) | $ | 480,125 | $ | 539,124 | |||||||||
Cash and cash equivalents | 10,507 | 20,725 | |||||||||||
Investment in subsidiaries, at equity in net assets | 1,821,024 | 1,475,956 | |||||||||||
Accounts receivable - affiliates | 312 | 380 | |||||||||||
Income taxes receivable | 17,478 | 17,958 | |||||||||||
Accrued investment income | 3,435 | 3,629 | |||||||||||
Other assets | 15,156 | 18,943 | |||||||||||
Total assets | $ | 2,348,037 | $ | 2,076,715 | |||||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||
Liabilities: | |||||||||||||
Senior notes | $ | 61,918 | $ | 82,773 | |||||||||
Convertible senior notes | 845,000 | 845,000 | |||||||||||
Convertible junior debentures | 389,522 | 389,522 | |||||||||||
Accrued interest | 14,694 | 14,882 | |||||||||||
Total liabilities | 1,311,134 | 1,332,177 | |||||||||||
Shareholders’ equity | |||||||||||||
Common stock, (one dollar par value, shares authorized 1,000,000; shares issued 2014 and 2013 – 340,047; outstanding 2014 – 338,560; 2013 – 337,758) | 340,047 | 340,047 | |||||||||||
Paid-in capital | 1,663,592 | 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 | (81,341 | ) | (117,726 | ) | |||||||||
Retained deficit | (852,458 | ) | (1,074,617 | ) | |||||||||
Total shareholders’ equity | 1,036,903 | 744,538 | |||||||||||
Total liabilities and shareholders’ equity | $ | 2,348,037 | $ | 2,076,715 | |||||||||
See accompanying supplementary notes to Parent Company condensed financial statements. | |||||||||||||
MGIC INVESTMENT CORPORATION | |||||||||||||
SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT | |||||||||||||
CONDENSED STATEMENTS OF OPERATIONS | |||||||||||||
PARENT COMPANY ONLY | |||||||||||||
Years Ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Revenues: | |||||||||||||
Investment income, net of expenses | $ | 6,985 | $ | 5,033 | $ | 6,921 | |||||||
Net realized investment gains | 395 | 830 | 9,895 | ||||||||||
Other revenue | - | - | 17,775 | ||||||||||
Total revenues | 7,380 | 5,863 | 34,591 | ||||||||||
Expenses: | |||||||||||||
Operating expenses and other | 1,383 | 511 | 2,227 | ||||||||||
Interest expense | 69,648 | 79,663 | 99,344 | ||||||||||
Total expenses | 71,031 | 80,174 | 101,571 | ||||||||||
Loss before tax | (63,651 | ) | (74,311 | ) | (66,980 | ) | |||||||
Provision for income taxes | - | - | - | ||||||||||
Equity in undistributed net income (loss) of subsidiaries | 315,600 | 24,463 | (860,099 | ) | |||||||||
Net income (loss) | 251,949 | (49,848 | ) | (927,079 | ) | ||||||||
Other comprehensive income (loss), net of tax | 36,385 | (69,563 | ) | (78,287 | ) | ||||||||
Comprehensive income (loss) | $ | 288,334 | $ | (119,411 | ) | $ | (1,005,366 | ) | |||||
See accompanying supplementary notes to Parent Company condensed financial statements. | |||||||||||||
MGIC INVESTMENT CORPORATION | |||||||||||||
SCHEDULE II - CONDENSED FINANCIAL INFORMATION OF REGISTRANT | |||||||||||||
CONDENSED STATEMENTS OF CASH FLOWS | |||||||||||||
PARENT COMPANY ONLY | |||||||||||||
Years Ended December 31, 2014, 2013 and 2012 | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Adjustments to reconcile net income (loss) to net cash used in operating activities: | |||||||||||||
Equity in undistributed net (income) loss of subsidiaries | (315,600 | ) | (24,463 | ) | 860,099 | ||||||||
Other | 14,862 | 21,693 | 23,765 | ||||||||||
Change in certain assets and liabilities: | |||||||||||||
Accounts receivable - affiliates | 68 | 289 | (753 | ) | |||||||||
Income taxes receivable | 480 | (3 | ) | 5,909 | |||||||||
Accrued investment income | 194 | (2,611 | ) | 2,702 | |||||||||
Accrued interest | (188 | ) | (15,577 | ) | 17,288 | ||||||||
Net cash used in operating activities | (48,235 | ) | (70,520 | ) | (18,069 | ) | |||||||
Cash flows from investing activities: | |||||||||||||
Transactions with subsidiaries | - | (800,000 | ) | (100,000 | ) | ||||||||
Purchase of fixed maturities | (553,538 | ) | (563,968 | ) | (120,181 | ) | |||||||
Sale of fixed maturities | 613,322 | 148,608 | 409,601 | ||||||||||
Net cash provided by (used in) investing activities | 59,784 | (1,215,360 | ) | 189,420 | |||||||||
Cash flows from financing activities: | |||||||||||||
Repayment of long-term debt | (21,767 | ) | (17,235 | ) | (53,107 | ) | |||||||
Net proceeds from convertible senior notes | - | 484,625 | - | ||||||||||
Common stock shares issued | - | 663,335 | - | ||||||||||
Net cash (used in) provided by financing activities | (21,767 | ) | 1,130,725 | (53,107 | ) | ||||||||
Net (decrease) increase in cash and cash equivalents | (10,218 | ) | (155,155 | ) | 118,244 | ||||||||
Cash and cash equivalents at beginning of year | 20,725 | 175,880 | 57,636 | ||||||||||
Cash and cash equivalents at end of year | $ | 10,507 | $ | 20,725 | $ | 175,880 | |||||||
See accompanying supplementary notes to Parent Company condensed financial statements. | |||||||||||||
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT | |||||||||||||
PARENT COMPANY ONLY | |||||||||||||
SUPPLEMENTARY NOTES | |||||||||||||
Note A | |||||||||||||
The accompanying Parent Company financial statements should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements appearing in Item 8 of this annual report. | |||||||||||||
Note B | |||||||||||||
Our insurance subsidiaries are subject to statutory regulations as to maintenance of policyholders’ surplus and payment of dividends. The maximum amount of dividends that the insurance subsidiaries may pay in any twelve-month period without regulatory approval by the Office of the Commissioner of Insurance of the State of Wisconsin is the lesser of adjusted statutory net income or 10% of statutory policyholders’ surplus as of the preceding calendar year end. Adjusted statutory net income is defined for this purpose to be the greater of statutory net income, net of realized investment gains, for the calendar year preceding the date of the dividend or statutory net income, net of realized investment gains, for the three calendar years preceding the date of the dividend less dividends paid within the first two of the preceding three calendar years. | |||||||||||||
The senior notes, convertible senior notes and convertible debentures, discussed in Note 8 – “Debt” to our consolidated financial statements in Item 8, are obligations of MGIC Investment Corporation, our holding company, and not of its subsidiaries. The payment of dividends from our insurance subsidiaries, which other than raising capital in the public markets is the principal source of our holding company cash inflow, is restricted by insurance regulation. MGIC is the principal source of dividend-paying capacity. Since 2008, MGIC has not paid any dividends to our holding company. In 2015, MGIC cannot pay any dividends to our holding company without approval from the OCI. | |||||||||||||
In the fourth quarter of 2008, we suspended the payment of dividends to shareholders. |
SCHEDULE_IVREINSURANCE
SCHEDULE IV-REINSURANCE | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
SCHEDULE IV-REINSURANCE [Abstract] | |||||||||||||||||||||
SCHEDULE IV-REINSURANCE | MGIC INVESTMENT CORPORATION | ||||||||||||||||||||
SCHEDULE IV — REINSURANCE | |||||||||||||||||||||
MORTGAGE INSURANCE PREMIUMS EARNED | |||||||||||||||||||||
Years Ended December 31, 2014, 2013 and 2012 | |||||||||||||||||||||
Gross | Ceded to | Assumed | Net | Percentage | |||||||||||||||||
Amount | Other | From | Amount | of Amount | |||||||||||||||||
Companies | Other | Assumed to | |||||||||||||||||||
Companies | Net | ||||||||||||||||||||
(In thousands of dollars) | |||||||||||||||||||||
Year ended December 31, | |||||||||||||||||||||
2014 | $ | 950,973 | $ | 108,255 | $ | 1,653 | $ | 844,371 | 0.2 | % | |||||||||||
2013 | 979,078 | 38,101 | 2,074 | 943,051 | 0.2 | % | |||||||||||||||
2012 | 1,065,663 | 34,918 | 2,425 | 1,033,170 | 0.2 | % |
Summary_of_Significant_Account1
Summary of Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Summary of Significant Accounting Policies [Abstract] | |||||||||||||
Fair value measurements | 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, equity 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 primarily 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. The fair value of real estate acquired is the lower of our acquisition cost or a percentage of the appraised value. The percentage applied to the 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. | |||||||||||||
Investments | Investments | ||||||||||||
Our entire investment portfolio is classified as available-for-sale and is reported at fair value. The related unrealized gains or losses are, after considering the related tax expense or benefit, recognized as a component of accumulated other comprehensive income (loss) in shareholders' equity. Realized investment gains and losses are reported in income based upon specific identification of securities sold. (See Note 6 – “Investments.”) | |||||||||||||
Each quarter we perform reviews of our investments in order to determine whether declines in fair value below amortized cost were considered other-than-temporary in accordance with applicable guidance. In evaluating whether a decline in fair value is other-than-temporary, we consider several factors including, but not limited to: | |||||||||||||
§ | our intent to sell the security or whether it is more likely than not that we will be required to sell the security before recovery; | ||||||||||||
§ | extent and duration of the decline; | ||||||||||||
§ | failure of the issuer to make scheduled interest or principal payments; | ||||||||||||
§ | change in rating below investment grade; and | ||||||||||||
§ | adverse conditions specifically related to the security, an industry, or a geographic area. | ||||||||||||
Based on our evaluation, we will record an other-than-temporary impairment adjustment on a security if we intend to sell the impaired security, if it is more likely than not that we will be required to sell the impaired security prior to recovery of its amortized cost basis, or if the present value of the cash flows we expect to collect is less than the amortized cost basis of the security. If the fair value of a security is below its amortized cost at the time of our intent to sell, the security is classified as other-than-temporarily impaired and the full amount of the impairment is recognized as a loss in the statement of operations. Otherwise, when a security is considered to be other-than-temporarily impaired, the losses are separated into the portion of the loss that represents the credit loss; and the portion that is due to other factors. The credit loss portion is recognized as a loss in the statement of operations, while the loss due to other factors is recognized in accumulated other comprehensive income (loss), net of taxes. A credit loss is determined to exist if the present value of the discounted cash flows, using the security’s original yield, expected to be collected from the security are less than the cost basis of the security. | |||||||||||||
Home office and equipment | Home office and equipment | ||||||||||||
Home office and equipment is carried at cost net of depreciation. For financial statement reporting purposes, depreciation is determined on a straight-line basis for the home office, equipment and data processing hardware over estimated lives of 45, 5 and 3 years, respectively. For income tax purposes, we use accelerated depreciation methods. | |||||||||||||
Home office and equipment is shown net of accumulated depreciation of $54.9 million, $53.0 million and $51.3 million at December 31, 2014, 2013 and 2012, respectively. Depreciation expense for the years ended December 31, 2014, 2013 and 2012 was $2.2 million, $1.8 million and $1.9 million, respectively. | |||||||||||||
Deferred Insurance Policy Acquisition Costs | Deferred Insurance Policy Acquisition Costs | ||||||||||||
Costs directly associated with the successful acquisition of mortgage insurance business, consisting of employee compensation and other policy issuance and underwriting expenses, are initially deferred and reported as deferred insurance policy acquisition costs (“DAC”). The deferred costs are net of any ceding commissions received associated with our reinsurance agreements. For each underwriting year of business, these costs are amortized to income in proportion to estimated gross profits over the estimated life of the policies. We utilize anticipated investment income in our calculation. This includes accruing interest on the unamortized balance of DAC. The estimates for each underwriting year are reviewed quarterly and updated when necessary to reflect actual experience and any changes to key variables such as persistency or loss development. If a premium deficiency exists (in other words, no gross profit is expected), we reduce the related DAC by the amount of the deficiency or to zero through a charge to current period earnings. If the deficiency is more than the related DAC balance, we then establish a premium deficiency reserve equal to the excess, by means of a charge to current period earnings. | |||||||||||||
Loss Reserves | Loss Reserves | ||||||||||||
Reserves are established for reported insurance losses and loss adjustment expenses based on when we receive notices of default on insured mortgage loans. We consider a loan in default when it is two or more payments past due. Even though the accounting standard, Accounting Standards Codification (“ASC”) 944, regarding accounting and reporting by insurance entities specifically excludes mortgage insurance from its guidance relating to loss reserves, we establish loss reserves using the general principles contained in the insurance standard. However, consistent with industry standards for mortgage insurers, we do not establish loss reserves for future claims on insured loans which are not currently in default. 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. Our loss estimates are established based upon historical experience, including rescission and loan modification activity. Adjustments to reserve estimates are reflected in the financial statements in the years in which the adjustments are made. The liability for reinsurance assumed is based on information provided by the ceding companies. | |||||||||||||
Reserves are also established for estimated losses from defaults occurring prior to the close of an accounting period on notices of default not yet reported to us. These incurred but not reported (“IBNR”) reserves are also established using estimated claim rates and claim severities. | |||||||||||||
Reserves also provide for the estimated costs of settling claims, including legal and other expenses and general expenses of administering the claims settlement process. Reserves are also ceded to reinsurers under our reinsurance agreements. (See Note 9 – “Loss Reserves” and Note 11 – “Reinsurance.”) | |||||||||||||
Premium Deficiency Reserve | Premium Deficiency Reserve | ||||||||||||
After our loss reserves are initially established, we perform premium deficiency tests using our best estimate assumptions as of the testing date. Premium deficiency reserves are established, if necessary, when the present value of expected future losses and expenses exceeds the present value of expected future premium and already established reserves. The discount rate used in the calculation of the premium deficiency reserve is based upon our pre-tax investment yield at year-end. Products are grouped for premium deficiency purposes based on similarities in the way the products are acquired, serviced and measured for profitability. | |||||||||||||
Calculations of premium deficiency reserves require the use of significant judgments and estimates to determine the present value of future premium and present value of expected losses and expenses on our business. The present value of future premium relies on, among other factors, assumptions about persistency and repayment patterns on underlying loans. The present value of expected losses and expenses depends on assumptions relating to severity of claims and claim rates on current defaults, and expected defaults in future periods. These assumptions also include an estimate of expected rescission activity. Assumptions used in calculating the deficiency reserves can be affected by volatility in the current housing and mortgage lending industries and these effects could be material. To the extent premium patterns and actual loss experience differ from the assumptions used in calculating the premium deficiency reserves, the differences between the actual results and our estimate will affect future period earnings. (See Note 10 - “Premium Deficiency Reserve.”) | |||||||||||||
Revenue Recognition | Revenue Recognition | ||||||||||||
We write policies which are guaranteed renewable contracts at the insured's option on a monthly, single, or annual premium basis. We have no ability to reunderwrite or reprice these contracts. Premiums written on monthly policies are earned as coverage is provided. Premiums written on a single premium basis and an annual premium basis are initially deferred as unearned premium reserve and earned over the policy life. Premiums written on policies covering more than one year are amortized over the policy life in relationship to the anticipated incurred loss pattern based on historical experience. Premiums written on annual policies are earned on a monthly pro rata basis. When a policy is cancelled for a reason other than rescission or claim payment, all premium that is non-refundable is immediately earned. Any refundable premium is returned to the servicer or borrower. Cancellations also include rescissions and policies cancelled due to claim payment. When a policy is rescinded, all previously collected premium is returned to the lender and when a claim is paid we return any premium received since the date of default. The liability associated with our estimate of premium to be returned is accrued for separately and separate components of this liability are included in “Other liabilities” and “Premium deficiency reserves” on our consolidated balance sheet. Changes in these liabilities affect premiums written and earned and change in premium deficiency reserve, respectively. The actual return of premium for all periods affects premiums written and earned. Policy cancellations also lower the persistency rate which is a variable used in calculating the rate of amortization of deferred insurance policy acquisition costs. | |||||||||||||
Fee income of our non-insurance subsidiaries is earned and recognized as the services are provided and the customer is obligated to pay. Fee income consists primarily of contract underwriting and related fee-based services provided to lenders and is included in “Other revenue” on the consolidated statements of operations. | |||||||||||||
Income Taxes | Income Taxes | ||||||||||||
Deferred income taxes are provided under the liability method, which recognizes the future tax effects of temporary differences between amounts reported in the financial statements and the tax bases of these items. The expected tax effects are computed at the enacted regular federal tax rate. Using this method, we have recorded a net deferred tax asset, before valuation allowance, in large part due to net operating losses incurred in prior years. On a quarterly basis, we review the need to maintain a deferred tax asset valuation allowance as an offset to the net deferred tax asset, before valuation allowance. 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, the expiration dates of the carryforwards, the cyclical nature of our operating results, and available tax planning strategies. As discussed in Note 14 –“Income Taxes,” we continue to reduce our benefit from income tax through the recognition of a valuation allowance. | |||||||||||||
We provide for uncertain tax positions and the related interest and penalties based on our assessment of whether a tax benefit is more likely than not to be sustained under any examination by taxing authorities. | |||||||||||||
Benefit Plans | Benefit Plans | ||||||||||||
We have a non-contributory defined benefit pension plan covering substantially all employees, as well as a supplemental executive retirement plan. Retirement benefits are based on compensation and years of service. We recognize these retirement benefit costs over the period during which employees render the service that qualifies them for benefits. Our policy is to fund pension cost as required under the Employee Retirement Income Security Act of 1974. | |||||||||||||
We offer both medical and dental benefits for retired domestic employees, their eligible spouses and dependents until the retiree reaches the age of 65. Under the plan retirees pay a premium for these benefits. We accrue the estimated costs of retiree medical and dental benefits over the period during which employees render the service that qualifies them for benefits. (See Note 13 – “Benefit Plans.”) | |||||||||||||
Reinsurance | Reinsurance | ||||||||||||
Loss reserves and unearned premiums are reported before taking credit for amounts ceded under reinsurance agreements. Ceded loss reserves are reflected as "Reinsurance recoverable on loss reserves." Ceded unearned premiums are reflected as “Prepaid reinsurance premiums.” Amounts due from reinsurers on paid claims are reflected as “Reinsurance recoverable on paid losses.” Ceded premiums payable are included in “Other liabilities.” Any profit commissions are included with “Premiums written – Ceded” and any ceding commissions are included with “Other underwriting and operating expenses, net.” We remain liable for all reinsurance ceded. (See Note 11 – “Reinsurance.”) | |||||||||||||
Foreign Currency Translation | Foreign Currency Translation | ||||||||||||
Assets and liabilities denominated in a foreign currency are translated at the year-end exchange rates. Operating results are translated at average rates of exchange prevailing during the year. Unrealized gains and losses, net of deferred taxes, resulting from translation are included in accumulated other comprehensive income (loss) in shareholders’ equity. Gains and losses resulting from transactions in a foreign currency are recorded in current period net income (loss) at the rate on the transaction date. | |||||||||||||
Share-Based Compensation | Share-Based Compensation | ||||||||||||
We have certain share-based compensation plans. Under the fair value method, compensation cost is measured at the grant date based on the fair value of the award and is recognized over the service period which generally corresponds to the vesting period. The fair value of awards classified as liabilities is remeasured at each reporting period until the award is settled. Awards under our plans generally vest over periods ranging from one to three years. (See Note 18 – “Share-based Compensation Plans.”) | |||||||||||||
Earnings per Share | Earnings per Share | ||||||||||||
Basic earnings per share (“EPS”) is calculated by dividing net income (loss) by the weighted average number of shares of common stock outstanding. Diluted EPS includes the components of basic EPS and also gives effect to dilutive common stock equivalents. We calculate diluted EPS using the treasury stock method and if-converted method. Under the treasury stock method, diluted EPS reflects the potential dilution that could occur if unvested restricted stock or granted stock options result in the issuance of common stock. Under the if-converted method, diluted EPS reflects the potential dilution that could occur if our convertible debt instruments result in the issuance of common stock. The determination of potentially issuable shares does not consider the satisfaction of the conversion requirements and the shares are included in the determination of diluted EPS as of the beginning of the period, if dilutive. We have several debt issuances that could potentially result in contingently issuable shares and consider each potential issuance of shares separately to reflect the maximum potential dilution. Accordingly, our dilutive common stock equivalents may not reflect all of the potential contingently issuable shares that could be required to be issued upon any debt conversion. For purposes of calculating basic and diluted EPS, vested restricted stock awards are considered outstanding. | |||||||||||||
GAAP requires unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, whether paid or unpaid, to be treated as participating securities and included in the computation of EPS pursuant to the two-class method. Our participating securities are composed of unvested restricted stock with non-forfeitable rights to dividends. There have been no dividends declared by us since the issuance of these participating securities and there has been no reduction to net income available to common shareholders. For the year ended December 31, 2014, participating securities of 0.1 million have been included in basic EPS and 0.1 million and 1.1 million have been excluded for the years ended December 31, 2013 and 2012, respectively, as they are anti-dilutive due to our net losses. | |||||||||||||
The computation of diluted EPS for the year ended December 31, 2014 includes the weighted average unvested restricted stock units outstanding of 3.1 million. During 2013 and 2012 we reported a consolidated net loss. As a result of the net loss, unvested restricted stock awards were anti-dilutive for the year and were not included in the computation of diluted weighted average shares. | |||||||||||||
For the year ended December 31, 2014, the outstanding Convertible Senior Notes due in 2020 are reflected in diluted earnings per share using the “if-converted” method. Under this method, if dilutive, the common stock is assumed issued as of the beginning the reporting period and included in calculating diluted EPS. In addition, if dilutive, interest expense, net of tax, related to the outstanding Convertible Senior Notes due in 2020 is added back to earnings in calculating diluted EPS. For the year ended December 31, 2014, 2013, and 2012, common stock equivalents under our convertible debt instruments of 54.5 million, 126.4 million, and 60.7 million, respectively, were excluded from weighted average shares as they were anti-dilutive. | |||||||||||||
The following table reconciles basic and diluted EPS amounts: | |||||||||||||
Years Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands, except per share data) | |||||||||||||
Basic earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Average common shares outstanding | 338,523 | 311,754 | 201,892 | ||||||||||
Basic income (loss) per share | $ | 0.74 | $ | (0.16 | ) | $ | (4.59 | ) | |||||
Diluted earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Interest expense, net of tax: | |||||||||||||
2% Convertible Senior Notes due 2020 | 12,197 | - | - | ||||||||||
Diluted income available to common shareholders | $ | 264,146 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Weighted-average shares - Basic | 338,523 | 311,754 | 201,892 | ||||||||||
Effect of dilutive securities: | |||||||||||||
Unvested restricted stock | 3,082 | - | - | ||||||||||
Convertible debt common stock equivalents | 71,942 | - | - | ||||||||||
Weighted-average shares - Diluted | 413,547 | 311,754 | 201,892 | ||||||||||
Diluted income (loss) per share | $ | 0.64 | $ | (0.16 | ) | $ | (4.59 | ) |
Summary_of_Significant_Account2
Summary of Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Summary of Significant Accounting Policies [Abstract] | |||||||||||||
Schedule of earnings per share | The following table reconciles basic and diluted EPS amounts: | ||||||||||||
Years Ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands, except per share data) | |||||||||||||
Basic earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Average common shares outstanding | 338,523 | 311,754 | 201,892 | ||||||||||
Basic income (loss) per share | $ | 0.74 | $ | (0.16 | ) | $ | (4.59 | ) | |||||
Diluted earnings (loss) per share: | |||||||||||||
Net income (loss) | $ | 251,949 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Interest expense, net of tax: | |||||||||||||
2% Convertible Senior Notes due 2020 | 12,197 | - | - | ||||||||||
Diluted income available to common shareholders | $ | 264,146 | $ | (49,848 | ) | $ | (927,079 | ) | |||||
Weighted-average shares - Basic | 338,523 | 311,754 | 201,892 | ||||||||||
Effect of dilutive securities: | |||||||||||||
Unvested restricted stock | 3,082 | - | - | ||||||||||
Convertible debt common stock equivalents | 71,942 | - | - | ||||||||||
Weighted-average shares - Diluted | 413,547 | 311,754 | 201,892 | ||||||||||
Diluted income (loss) per share | $ | 0.64 | $ | (0.16 | ) | $ | (4.59 | ) |
Investments_Tables
Investments (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Investments [Abstract] | |||||||||||||||||||||||||
Amortized cost, gross unrealized gains and losses and fair value of investment portfolio | The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at December 31, 2014 and 2013 are shown below: | ||||||||||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||||||||||
31-Dec-14 | Cost | Unrealized | Unrealized | Value | |||||||||||||||||||||
Gains | Losses (1) | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 349,153 | $ | 2,752 | $ | (5,130 | ) | $ | 346,775 | ||||||||||||||||
Obligations of U.S. states and political subdivisions | 844,942 | 12,961 | (2,761 | ) | 855,142 | ||||||||||||||||||||
Corporate debt securities | 2,418,991 | 16,325 | (10,035 | ) | 2,425,281 | ||||||||||||||||||||
Asset-backed securities | 286,260 | 535 | (140 | ) | 286,655 | ||||||||||||||||||||
Residential mortgage-backed securities | 329,983 | 254 | (9,000 | ) | 321,237 | ||||||||||||||||||||
Commercial mortgage-backed securities | 276,215 | 1,221 | (2,158 | ) | 275,278 | ||||||||||||||||||||
Collateralized loan obligations | 61,340 | - | (1,264 | ) | 60,076 | ||||||||||||||||||||
Debt securities issued by foreign sovereign governments | 35,630 | 3,540 | - | 39,170 | |||||||||||||||||||||
Total debt securities | 4,602,514 | 37,588 | (30,488 | ) | 4,609,614 | ||||||||||||||||||||
Equity securities | 3,003 | 61 | (9 | ) | 3,055 | ||||||||||||||||||||
Total investment portfolio | $ | 4,605,517 | $ | 37,649 | $ | (30,497 | ) | $ | 4,612,669 | ||||||||||||||||
Amortized | Gross | Gross | Fair | ||||||||||||||||||||||
Cost | Unrealized | Unrealized | Value | ||||||||||||||||||||||
31-Dec-13 | Gains | Losses (1) | |||||||||||||||||||||||
(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 | There were no other-than-temporary impairment losses recorded in other comprehensive income (loss) at December 31, 2014 and 2013. | ||||||||||||||||||||||||
Amortized cost and fair values of debt securities by contractual maturity | The amortized cost and fair values of debt securities at December 31, 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 | ||||||||||||||||||||||||
31-Dec-14 | Cost | Value | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Due in one year or less | $ | 330,602 | $ | 330,982 | |||||||||||||||||||||
Due after one year through five years | 1,903,661 | 1,909,422 | |||||||||||||||||||||||
Due after five years through ten years | 1,063,679 | 1,069,433 | |||||||||||||||||||||||
Due after ten years | 350,774 | 356,531 | |||||||||||||||||||||||
3,648,716 | 3,666,368 | ||||||||||||||||||||||||
Asset-backed securities | 286,260 | 286,655 | |||||||||||||||||||||||
Residential mortgage-backed securities | 329,983 | 321,237 | |||||||||||||||||||||||
Commercial mortgage-backed securities | 276,215 | 275,278 | |||||||||||||||||||||||
Collateralized loan obligations | 61,340 | 60,076 | |||||||||||||||||||||||
Total at December 31, 2014 | $ | 4,602,514 | $ | 4,609,614 | |||||||||||||||||||||
Aging of the fair values of securities in an unrealized loss position | At December 31, 2014 and 2013, the investment portfolio had gross unrealized losses of $30.5 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 | ||||||||||||||||||||
31-Dec-14 | Value | Losses | Value | Losses | Value | Losses | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 58,166 | $ | 138 | $ | 232,351 | $ | 4,992 | $ | 290,517 | $ | 5,130 | |||||||||||||
Obligations of U.S. states and political subdivisions | 166,408 | 1,066 | 114,465 | 1,695 | 280,873 | 2,761 | |||||||||||||||||||
Corporate debt securities | 816,555 | 5,259 | 243,208 | 4,776 | 1,059,763 | 10,035 | |||||||||||||||||||
Asset-backed securities | 54,491 | 80 | 11,895 | 60 | 66,386 | 140 | |||||||||||||||||||
Residential mortgage-backed securities | 24,168 | 34 | 263,002 | 8,966 | 287,170 | 9,000 | |||||||||||||||||||
Commercial mortgage-backed securities | 89,301 | 810 | 110,652 | 1,348 | 199,953 | 2,158 | |||||||||||||||||||
Collateralized loan obligations | - | - | 60,076 | 1,264 | 60,076 | 1,264 | |||||||||||||||||||
Debt securities issued by foreign sovereign governments | - | - | - | - | - | - | |||||||||||||||||||
Equity securities | 167 | 1 | 235 | 8 | 402 | 9 | |||||||||||||||||||
Total investment portfolio | $ | 1,209,256 | $ | 7,388 | $ | 1,035,884 | $ | 23,109 | $ | 2,245,140 | $ | 30,497 | |||||||||||||
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 investment income | Net investment income is comprised of the following: | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Fixed maturities | $ | 89,437 | $ | 82,168 | $ | 122,886 | |||||||||||||||||||
Equity securities | 227 | 229 | 200 | ||||||||||||||||||||||
Cash equivalents | 179 | 353 | 333 | ||||||||||||||||||||||
Other | 711 | 675 | 782 | ||||||||||||||||||||||
Investment income | 90,554 | 83,425 | 124,201 | ||||||||||||||||||||||
Investment expenses | (2,907 | ) | (2,686 | ) | (2,561 | ) | |||||||||||||||||||
Net investment income | $ | 87,647 | $ | 80,739 | $ | 121,640 | |||||||||||||||||||
Net realized investment gains (losses), including impairment losses, and change in net unrealized appreciation (depreciation) of investments | The net realized investment gains (losses), including impairment losses, and change in net unrealized gains (losses) of investments are as follows: | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Net realized investment gains (losses) on investments: | |||||||||||||||||||||||||
Fixed maturities | $ | 1,000 | $ | 3,274 | $ | 195,652 | |||||||||||||||||||
Equity securities | 356 | 1,068 | 487 | ||||||||||||||||||||||
Other | 1 | 1,389 | (730 | ) | |||||||||||||||||||||
Total net realized investment gains | $ | 1,357 | $ | 5,731 | $ | 195,409 | |||||||||||||||||||
Change in net unrealized gains (losses): | |||||||||||||||||||||||||
Fixed maturities | $ | 91,718 | $ | (126,020 | ) | $ | (78,604 | ) | |||||||||||||||||
Equity securities | 66 | (153 | ) | 58 | |||||||||||||||||||||
Other | - | - | - | ||||||||||||||||||||||
Total increase (decrease) in net unrealized gains/losses | $ | 91,784 | $ | (126,173 | ) | $ | (78,546 | ) | |||||||||||||||||
Gross realized gains, gross realized losses and impairment losses | The gross realized gains, gross realized losses and impairment losses are as follows: | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Gross realized gains | $ | 4,966 | $ | 11,043 | $ | 213,827 | |||||||||||||||||||
Gross realized losses | (3,465 | ) | (4,984 | ) | (16,108 | ) | |||||||||||||||||||
Impairment losses | (144 | ) | (328 | ) | (2,310 | ) | |||||||||||||||||||
Net realized gains on securities | $ | 1,357 | $ | 5,731 | $ | 195,409 |
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Fair Value Measurements [Abstract] | |||||||||||||||||||||
Fair value measurements for items measured at fair value | Assets measured at fair value included those listed, by hierarchy level, in the following tables as of December 31, 2014 and 2013: | ||||||||||||||||||||
Fair Value | Quoted Prices in | Significant | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | |||||||||||||||||||
Identical Assets | Observable Inputs | Inputs | |||||||||||||||||||
(Level 1) | (Level 2) | (Level 3) | |||||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government corporations and agencies | $ | 346,775 | $ | 188,824 | $ | 157,951 | $ | - | |||||||||||||
Obligations of U.S. states and political subdivisions | 855,142 | - | 853,296 | 1,846 | |||||||||||||||||
Corporate debt securities | 2,425,281 | - | 2,425,281 | - | |||||||||||||||||
Asset-backed securities | 286,655 | - | 286,655 | - | |||||||||||||||||
Residential mortgage-backed securities | 321,237 | - | 321,237 | - | |||||||||||||||||
Commercial mortgage-backed securities | 275,278 | - | 275,278 | - | |||||||||||||||||
Collateralized loan obligations | 60,076 | - | 60,076 | - | |||||||||||||||||
Debt securities issued by foreign sovereign governments | 39,170 | 39,170 | - | - | |||||||||||||||||
Total debt securities | 4,609,614 | 227,994 | 4,379,774 | 1,846 | |||||||||||||||||
Equity securities | 3,055 | 2,734 | - | 321 | |||||||||||||||||
Total investments | $ | 4,612,669 | $ | 230,728 | $ | 4,379,774 | $ | 2,167 | |||||||||||||
Real estate acquired (1) | $ | 12,658 | $ | - | $ | - | $ | 12,658 | |||||||||||||
-1 | Real estate acquired through claim settlement, which is held for sale, is reported in Other Assets on the consolidated balance sheets. | ||||||||||||||||||||
Fair Value | Quoted Prices in | Significant | |||||||||||||||||||
Active Markets for | Significant Other | Unobservable | |||||||||||||||||||
Identical Assets | Observable 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 sheets. | ||||||||||||||||||||
Reconciliation of beginning and ending balance for assets and liabilities measured at fair value with significant unobservable inputs (level 3) | For assets and liabilities measured at fair value using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances for the years ended December 31, 2014 and 2013 is as follows: | ||||||||||||||||||||
Obligations of U.S. | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
States and Political | Securities | 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 | - | - | - | - | (4,129 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 42,247 | ||||||||||||||||
Sales | (607 | ) | - | - | (607 | ) | (38,740 | ) | |||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2014 | $ | 1,846 | $ | - | $ | 321 | $ | 2,167 | $ | 12,658 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2014 attributable to the change in unrealized losses on assets still held at December 31, 2014 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
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 | - | - | - | - | (4,959 | ) | |||||||||||||||
Purchases | 30 | - | - | 30 | 39,188 | ||||||||||||||||
Sales | (737 | ) | (16,889 | ) | - | (17,626 | ) | (24,412 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2013 | $ | 2,423 | $ | - | $ | 321 | $ | 2,744 | $ | 13,280 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2013 attributable to the change in unrealized losses on assets still held at December 31, 2013 | $ | - | $ | - | $ | - | $ | - | $ | - | |||||||||||
Obligations of U.S. | |||||||||||||||||||||
States and Political | Corporate Debt | Equity | Total | Real Estate | |||||||||||||||||
Subdivisions | Securities | Securities | Investments | Acquired | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
Balance at December 31, 2011 | $ | 114,226 | $ | 60,228 | $ | 321 | $ | 174,775 | $ | 1,621 | |||||||||||
Total realized/unrealized gains (losses): | |||||||||||||||||||||
Included in earnings and reported as realized investment gains (losses), net | (8,669 | ) | (3,129 | ) | - | (11,798 | ) | - | |||||||||||||
Included in earnings and reported as net impairment losses recognized in earnings | - | (2,310 | ) | - | (2,310 | ) | |||||||||||||||
Included in earnings and reported as losses incurred, net | - | - | - | - | (1,126 | ) | |||||||||||||||
Included in other comprehensive income | 5,630 | 733 | - | 6,363 | - | ||||||||||||||||
Purchases | 27 | - | - | 27 | 11,991 | ||||||||||||||||
Sales | (108,084 | ) | (38,408 | ) | - | (146,492 | ) | (9,023 | ) | ||||||||||||
Transfers into Level 3 | - | - | - | - | - | ||||||||||||||||
Transfers out of Level 3 | - | - | - | - | - | ||||||||||||||||
Balance at December 31, 2012 | $ | 3,130 | $ | 17,114 | $ | 321 | $ | 20,565 | $ | 3,463 | |||||||||||
Amount of total losses included in earnings for the year ended December 31, 2012 attributable to the change in unrealized losses on assets still held at December 31, 2012 | $ | - | $ | - | $ | - | $ | - | $ | - |
Debt_Tables
Debt (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Debt [Abstract] | |||||||||||||||||||||
Fair value of debt | The par value and fair value of our debt at December 31, 2014 and 2013 appears in the table below. | ||||||||||||||||||||
Quoted Prices in | Significant Other | Significant | |||||||||||||||||||
Active Markets | Observable | Unobservable | |||||||||||||||||||
Total Fair | for Identical | Inputs | Inputs | ||||||||||||||||||
Par Value | Value | Assets (Level 1) | (Level 2) | (Level 3) | |||||||||||||||||
(In thousands) | |||||||||||||||||||||
31-Dec-14 | |||||||||||||||||||||
Debt: | |||||||||||||||||||||
Senior Notes | $ | 61,953 | $ | 63,618 | $ | - | $ | 63,618 | $ | - | |||||||||||
Convertible Senior Notes due 2017 | 345,000 | 387,997 | - | 387,997 | - | ||||||||||||||||
Convertible Senior Notes due 2020 | 500,000 | 735,075 | - | 735,075 | - | ||||||||||||||||
Convertible Junior Subordinated Debentures | 389,522 | 500,201 | - | 500,201 | - | ||||||||||||||||
Total Debt | $ | 1,296,475 | $ | 1,686,891 | $ | - | $ | 1,686,891 | $ | - | |||||||||||
31-Dec-13 | |||||||||||||||||||||
Debt: | |||||||||||||||||||||
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 | $ | - |
Loss_Reserves_Tables
Loss Reserves (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Loss Reserves [Abstract] | |||||||||||||||||||||||||
Reconciliation of beginning and ending loss reserves | The following table provides a reconciliation of beginning and ending loss reserves for each of the past three years: | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Reserve at beginning of year | $ | 3,061,401 | $ | 4,056,843 | $ | 4,557,512 | |||||||||||||||||||
Less reinsurance recoverable | 64,085 | 104,848 | 154,607 | ||||||||||||||||||||||
Net reserve at beginning of year | 2,997,316 | 3,951,995 | 4,402,905 | ||||||||||||||||||||||
Losses incurred: | |||||||||||||||||||||||||
Losses and LAE incurred in respect of default notices received in: | |||||||||||||||||||||||||
Current year | 596,436 | 898,413 | 1,494,133 | ||||||||||||||||||||||
Prior years (1) | (100,359 | ) | (59,687 | ) | 573,120 | ||||||||||||||||||||
Subtotal | 496,077 | 838,726 | 2,067,253 | ||||||||||||||||||||||
Losses paid: | |||||||||||||||||||||||||
Losses and LAE paid in respect of default notices received in: | |||||||||||||||||||||||||
Current year | 32,919 | 73,470 | 134,509 | ||||||||||||||||||||||
Prior years | 1,121,508 | 1,722,923 | 2,389,985 | ||||||||||||||||||||||
Reinsurance terminations (2) | - | (2,988 | ) | (6,331 | ) | ||||||||||||||||||||
Subtotal | 1,154,427 | 1,793,405 | 2,518,163 | ||||||||||||||||||||||
Net reserve at end of year | 2,338,966 | 2,997,316 | 3,951,995 | ||||||||||||||||||||||
Plus reinsurance recoverables | 57,841 | 64,085 | 104,848 | ||||||||||||||||||||||
Reserve at end of year | $ | 2,396,807 | $ | 3,061,401 | $ | 4,056,843 | |||||||||||||||||||
-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. See table below regarding prior year loss development. | ||||||||||||||||||||||||
-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. (See Note 11 – “Reinsurance”) | ||||||||||||||||||||||||
Prior year development of the reserves | The prior year development of the reserves in 2014, 2013 and 2012 is reflected in the table below. | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Prior year loss development: | |||||||||||||||||||||||||
Pool policy settlement (1) | $ | - | $ | - | $ | 267 | |||||||||||||||||||
(Decrease) increase in estimated claim rate on primary defaults | (43 | ) | 10 | 260 | |||||||||||||||||||||
Decrease in estimated severity on primary defaults | (35 | ) | (50 | ) | (70 | ) | |||||||||||||||||||
Change in estimates related to pool reserves, LAE reserves, reinsurance and other (2) | (22 | ) | (20 | ) | 116 | ||||||||||||||||||||
Total prior year loss development | $ | (100 | ) | $ | (60 | ) | $ | 573 | |||||||||||||||||
-1 | See below for a discussion of our settlement with Freddie Mac. | ||||||||||||||||||||||||
-2 | Includes approximately $100 million related to probable settlements regarding our claims paying practices in 2012 | ||||||||||||||||||||||||
Rollforward of primary default inventory | A rollforward of our primary default inventory for the years ended December 31, 2014, 2013 and 2012 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 by transfers of servicing between loan servicers. | ||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Default inventory at beginning of year | 103,328 | 139,845 | 175,639 | ||||||||||||||||||||||
New Notices | 88,844 | 106,823 | 133,232 | ||||||||||||||||||||||
Cures | (87,278 | ) | (104,390 | ) | (120,248 | ) | |||||||||||||||||||
Paids (including those charged to a deductible or captive) | (23,494 | ) | (34,738 | ) | (45,741 | ) | |||||||||||||||||||
Rescissions and denials | (1,306 | ) | (1,939 | ) | (3,037 | ) | |||||||||||||||||||
Items removed from inventory resulting from the Countrywide settlement on GSE loans | (193 | ) | (2,273 | ) | - | ||||||||||||||||||||
Default inventory at end of year | 79,901 | 103,328 | 139,845 | ||||||||||||||||||||||
Aging of the primary default inventory | Aging of the Primary Default Inventory | ||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
Consecutive months in default | 15,319 | 19 | % | 18,941 | 18 | % | 23,282 | 17 | % | ||||||||||||||||
3 months or less | |||||||||||||||||||||||||
4 - 11 months | 19,710 | 25 | % | 24,514 | 24 | % | 34,688 | 25 | % | ||||||||||||||||
12 months or more | 44,872 | 56 | % | 59,873 | 58 | % | 81,875 | 58 | % | ||||||||||||||||
Total primary default inventory | 79,901 | 100 | % | 103,328 | 100 | % | 139,845 | 100 | % | ||||||||||||||||
Primary claims received inventory included in ending default inventory (1) | 4,746 | 6 | % | 6,948 | 7 | % | 11,731 | 8 | % | ||||||||||||||||
-1 | Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to loans that we believed would be included in a potential resolution. As of December 31, 2014, rescissions of coverage on approximately 1,425 loans had been voluntarily suspended. | ||||||||||||||||||||||||
Number of payments delinquent | Number of Primary Payments Delinquent | ||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
3 payments or less | 23,253 | 29 | % | 28,095 | 27 | % | 34,245 | 24 | % | ||||||||||||||||
4 - 11 payments | 19,427 | 24 | % | 24,605 | 24 | % | 34,458 | 25 | % | ||||||||||||||||
12 payments or more | 37,221 | 47 | % | 50,628 | 49 | % | 71,142 | 51 | % | ||||||||||||||||
Total primary default inventory | 79,901 | 100 | % | 103,328 | 100 | % | 139,845 | 100 | % |
Premium_Deficiency_Reserve_Tab
Premium Deficiency Reserve (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Premium Deficiency Reserve [Abstract] | |||||||||||||||||||||||||
Components of premium deficiency reserve | The components of the premium deficiency reserve at December 31, 2014, 2013 and 2012 appear in the table below. | ||||||||||||||||||||||||
December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Present value of expected future premium | $ | 387 | $ | 432 | $ | 445 | |||||||||||||||||||
Present value of expected future paid losses and expenses | (941 | ) | (1,101 | ) | (1,285 | ) | |||||||||||||||||||
Net present value of future cash flows | (554 | ) | (669 | ) | (840 | ) | |||||||||||||||||||
Established loss reserves | 530 | 621 | 766 | ||||||||||||||||||||||
Net deficiency | $ | (24 | ) | $ | (48 | ) | $ | (74 | ) | ||||||||||||||||
Discount rate utilized at December 31, | 2.1 | % | 1.6 | % | 1.3 | % | |||||||||||||||||||
Reconciliation of beginning and ending balances in the premium deficiency reserve | The decrease in the premium deficiency reserve for the years ended December 31, 2014, 2013 and 2012 appears in the table below. | ||||||||||||||||||||||||
Years ended December 31, | |||||||||||||||||||||||||
2014 | 2013 | 2012 | |||||||||||||||||||||||
(In millions) | |||||||||||||||||||||||||
Premium Deficiency Reserve at beginning of year | $ | (48 | ) | $ | (74 | ) | $ | (135 | ) | ||||||||||||||||
Paid claims and loss adjustment expenses | $ | 169 | $ | 214 | $ | 279 | |||||||||||||||||||
Decrease in loss reserves | (91 | ) | (145 | ) | (60 | ) | |||||||||||||||||||
Premium earned | (79 | ) | (96 | ) | (102 | ) | |||||||||||||||||||
Effects of present valuing on future premiums, losses and expenses | (2 | ) | (1 | ) | (1 | ) | |||||||||||||||||||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | (3 | ) | (28 | ) | 116 | ||||||||||||||||||||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses, expenses and discount rate (1) | 27 | 54 | (55 | ) | |||||||||||||||||||||
Premium Deficiency Reserve at end of year | $ | (24 | ) | $ | (48 | ) | $ | (74 | ) | ||||||||||||||||
-1 | A positive (negative) number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a redundancy (deficiency) of prior premium deficiency reserves. |
Reinsurance_Tables
Reinsurance (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Reinsurance [Abstract] | |||||||||||||
Combined quota share reinsurance | A summary of the combined quota share reinsurance agreement for 2014 and 2013 appears below. | ||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Ceded premiums written, net of profit commission | $ | 100,031 | $ | 49,672 | |||||||||
Ceded premiums earned, net of profit commission | 88,528 | 13,821 | |||||||||||
Ceded losses incurred | 15,163 | 176 | |||||||||||
Ceding commissions (1) | 37,833 | 10,408 | |||||||||||
-1 | Ceding commissons are reported within Other underwriting and operating expenses, net on the consolidated statements of operations. | ||||||||||||
Effect of reinsurance agreements on premiums earned and losses incurred | The effect of all reinsurance agreements on premiums earned and losses incurred is as follows: | ||||||||||||
Years ended December 31, | |||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Premiums earned: | |||||||||||||
Direct | $ | 950,973 | $ | 979,078 | $ | 1,065,663 | |||||||
Assumed | 1,653 | 2,074 | 2,425 | ||||||||||
Ceded | (108,255 | ) | (38,101 | ) | (34,918 | ) | |||||||
Net premiums earned | $ | 844,371 | $ | 943,051 | $ | 1,033,170 | |||||||
Losses incurred: | |||||||||||||
Direct | $ | 524,051 | $ | 863,871 | $ | 2,115,974 | |||||||
Assumed | 2,012 | 2,645 | 6,912 | ||||||||||
Ceded | (29,986 | ) | (27,790 | ) | (55,633 | ) | |||||||
Net losses incurred | $ | 496,077 | $ | 838,726 | $ | 2,067,253 |
Other_Comprehensive_Income_Tab
Other Comprehensive Income (Tables) | 12 Months Ended | ||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||
Other Comprehensive Income [Abstract] | |||||||||||||||||||
Other comprehensive income | Our other comprehensive income for the years ended December 31, 2014, 2013 and 2012 was as follows: | ||||||||||||||||||
2014 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | 91,782 | $ | (32,017 | ) | $ | 31,374 | $ | 91,139 | ||||||||||
Benefit plans adjustments | (52,112 | ) | 18,239 | (18,239 | ) | (52,112 | ) | ||||||||||||
Unrealized foreign currency translation adjustment | (4,067 | ) | 1,425 | - | (2,642 | ) | |||||||||||||
Other comprehensive income (loss) | $ | 35,603 | $ | (12,353 | ) | $ | 13,135 | $ | 36,385 | ||||||||||
2013 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | (126,175 | ) | $ | 43,732 | $ | (41,148 | ) | $ | (123,591 | ) | ||||||||
Benefit plans adjustments | 68,038 | (23,813 | ) | 23,813 | 68,038 | ||||||||||||||
Unrealized foreign currency translation adjustment | (21,563 | ) | 7,553 | - | (14,010 | ) | |||||||||||||
Other comprehensive income (loss) | $ | (79,700 | ) | $ | 27,472 | $ | (17,335 | ) | $ | (69,563 | ) | ||||||||
2012 | |||||||||||||||||||
Valuation | |||||||||||||||||||
Before tax | Tax effect | allowance | Net of tax | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Other comprehensive income (loss): | |||||||||||||||||||
Change in unrealized gains and losses on investments | $ | (78,546 | ) | $ | 27,510 | $ | (27,623 | ) | $ | (78,659 | ) | ||||||||
Benefit plan adjustments | (1,221 | ) | 428 | (428 | ) | (1,221 | ) | ||||||||||||
Unrealized foreign currency translation adjustment | 2,452 | (859 | ) | - | 1,593 | ||||||||||||||
Other comprehensive income (loss) | $ | (77,315 | ) | $ | 27,079 | $ | (28,051 | ) | $ | (78,287 | ) | ||||||||
Accumulated other comprehensive income (loss) | A rollforward of accumulated other comprehensive income (loss) for the years ended December 31, 2014, 2013, and 2012 , including amounts reclassified from accumulated other comprehensive income (loss), are included in the table below. | ||||||||||||||||||
2014 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | Total | ||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | |||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2013, before tax | $ | (84,634 | ) | $ | (3,766 | ) | $ | 11,184 | $ | (77,216 | ) | ||||||||
Other comprehensive income (loss) before reclassifications | 78,294 | (45,182 | ) | (4,067 | ) | 29,045 | |||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | (13,488 | )(1) | 6,930 | -2 | - | (6,558 | ) | ||||||||||||
Net current period other comprehensive income (loss) | 91,782 | (52,112 | ) | (4,067 | ) | 35,603 | |||||||||||||
Balance at December 31, 2014, before tax | 7,148 | (55,878 | ) | 7,117 | (41,613 | ) | |||||||||||||
Tax effect (3) | (64,699 | ) | 26,940 | (1,969 | ) | (39,728 | ) | ||||||||||||
Balance at December 31, 2014, net of tax | $ | (57,551 | ) | $ | (28,938 | ) | $ | 5,148 | $ | (81,341 | ) | ||||||||
2013 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | |||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | Total | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2012, before tax | $ | 41,541 | $ | (71,804 | ) | $ | 32,747 | $ | 2,484 | ||||||||||
Other comprehensive income (loss) before reclassifications | (112,667 | ) | 68,039 | (21,563 | ) | (66,191 | ) | ||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 13,508 | -1 | 1 | -2 | - | 13,509 | |||||||||||||
Net current period other comprehensive income (loss) | (126,175 | ) | 68,038 | (21,563 | ) | (79,700 | ) | ||||||||||||
Balance at December 31, 2013, before tax | (84,634 | ) | (3,766 | ) | 11,184 | (77,216 | ) | ||||||||||||
Tax effect (3) | (64,056 | ) | 26,940 | (3,394 | ) | (40,510 | ) | ||||||||||||
Balance at December 31, 2013, net of tax | $ | (148,690 | ) | $ | 23,174 | $ | 7,790 | $ | (117,726 | ) | |||||||||
2012 | |||||||||||||||||||
Unrealized gains and | Defined | Foreign | |||||||||||||||||
losses on available- | benefit | currency | |||||||||||||||||
for-sale securities | plans | translation | Total | ||||||||||||||||
(In thousands) | |||||||||||||||||||
Balance at December 31, 2011, before tax | $ | 120,087 | $ | (70,582 | ) | $ | 30,294 | $ | 79,799 | ||||||||||
Other comprehensive income (loss) before reclassifications | 22,710 | (2,296 | ) | 2,453 | 22,867 | ||||||||||||||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 101,256 | -1 | (1,074 | ) | -2 | - | 100,182 | ||||||||||||
Net current period other comprehensive income (loss) | (78,546 | ) | (1,222 | ) | 2,453 | (77,315 | ) | ||||||||||||
Balance at December 31, 2012, before tax | 41,541 | (71,804 | ) | 32,747 | 2,484 | ||||||||||||||
Tax effect (3) | (66,640 | ) | 26,940 | (10,947 | ) | (50,647 | ) | ||||||||||||
Balance at December 31, 2012, net of tax | $ | (25,099 | ) | $ | (44,864 | ) | $ | 21,800 | $ | (48,163 | ) | ||||||||
-1 | During 2014, 2013 and 2012, net unrealized (losses) gains of ($13.5) million, $13.5 million and $101.3 million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains. | ||||||||||||||||||
-2 | For the years ended December 31, 2014, 2013 and 2012, other comprehensive income (loss) related to benefit plans of $6.9 million, $1 thousand, and ($1.1) million, respectively, was reclassified to the Consolidated Statements 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. |
Benefit_Plans_Tables
Benefit Plans (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Benefit Plans [Abstract] | |||||||||||||||||||||||||
Components of net periodic benefit cost | The following tables provide the components of aggregate annual net periodic benefit cost, changes in the benefit obligation and the funded status of the pension, supplemental executive retirement and other postretirement benefit plans as recognized in the consolidated balance sheets: | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Components of Net Periodic Benefit Cost for fiscal year ending | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/12 | 12/31/14 | 12/31/13 | 12/31/12 | ||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Company Service Cost | $ | 8,565 | $ | 11,338 | $ | 9,662 | $ | 659 | $ | 812 | $ | 1,226 | |||||||||||||
2. Interest Cost | 15,987 | 15,289 | 16,481 | 653 | 618 | 1,144 | |||||||||||||||||||
3. Expected Return on Assets | (21,030 | ) | (20,144 | ) | (18,211 | ) | (4,648 | ) | (3,679 | ) | (3,162 | ) | |||||||||||||
4. Other Adjustments | - | - | - | - | - | - | |||||||||||||||||||
Subtotal | 3,522 | 6,483 | 7,932 | (3,336 | ) | (2,249 | ) | (792 | ) | ||||||||||||||||
5. Amortization of : | |||||||||||||||||||||||||
a. Net Transition Obligation/(Asset) | - | - | - | - | - | - | |||||||||||||||||||
b. Net Prior Service Cost/(Credit) | (930 | ) | 503 | 665 | (6,649 | ) | (6,649 | ) | (6,217 | ) | |||||||||||||||
c. Net Losses/(Gains) | 1,083 | 6,145 | 5,829 | (435 | ) | - | 797 | ||||||||||||||||||
Total Amortization | 153 | 6,648 | 6,494 | (7,084 | ) | (6,649 | ) | (5,420 | ) | ||||||||||||||||
6. Net Periodic Benefit Cost | 3,675 | 13,131 | 14,426 | (10,420 | ) | (8,898 | ) | (6,212 | ) | ||||||||||||||||
7. Cost of settlements or curtailments | 302 | - | - | - | - | - | |||||||||||||||||||
8. Total Expense for Year | $ | 3,977 | $ | 13,131 | $ | 14,426 | $ | (10,420 | ) | $ | (8,898 | ) | $ | (6,212 | ) | ||||||||||
Development of funded status | Development of Funded Status | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Actuarial Value of Benefit Obligations | |||||||||||||||||||||||||
1.Measurement Date | 12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | |||||||||||||||||||||
2. Accumulated Benefit Obligation | $ | 366,440 | $ | 304,825 | $ | 18,225 | $ | 15,764 | |||||||||||||||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet | |||||||||||||||||||||||||
1. Projected Benefit Obligation | $ | (379,324 | ) | $ | (317,606 | ) | $ | (18,225 | ) | $ | (15,764 | ) | |||||||||||||
2. Plan Assets at Fair Value | 378,701 | 355,704 | 66,940 | 62,298 | |||||||||||||||||||||
3. Funded Status - Overfunded/Asset | N/A | $ | 38,098 | $ | 48,715 | $ | 46,534 | ||||||||||||||||||
4. Funded Status - Underfunded/Liability | (623 | ) | N/A | N/A | N/A | ||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Accumulated Other Comprehensive Income | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Net Actuarial (Gain)/Loss | $ | 93,243 | $ | 49,925 | $ | (8,222 | ) | $ | (9,439 | ) | |||||||||||||||
2. Net Prior Service Cost/(Credit) | (3,853 | ) | (4,782 | ) | (25,289 | ) | (31,938 | ) | |||||||||||||||||
3. Net Transition Obligation/(Asset) | - | - | - | - | |||||||||||||||||||||
4. Total at Year End | $ | 89,390 | $ | 45,143 | $ | (33,511 | ) | $ | (41,377 | ) | |||||||||||||||
Change in projected benefit obligation | The changes in the projected benefit obligation are as follows: | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Projected Benefit/Accumulated Benefit Obligation | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Benefit Obligation at Beginning of Year | $ | 317,606 | $ | 362,657 | $ | 15,764 | $ | 16,284 | |||||||||||||||||
2. Company Service Cost | 8,565 | 11,338 | 659 | 812 | |||||||||||||||||||||
3. Interest Cost | 15,987 | 15,289 | 653 | 618 | |||||||||||||||||||||
4. Plan Participants' Contributions | - | - | 336 | 299 | |||||||||||||||||||||
5. Net Actuarial (Gain)/Loss due to Assumption Changes | 59,901 | (44,205 | ) | 2,276 | (1,414 | ) | |||||||||||||||||||
6. Net Actuarial (Gain)/Loss due to Plan Experience | (55 | ) | 1,353 | (855 | ) | 101 | |||||||||||||||||||
7. Benefit Payments from Fund (1) | (21,539 | ) | (22,497 | ) | (645 | ) | (871 | ) | |||||||||||||||||
8. Benefit Payments Directly by Company | (1,404 | ) | (275 | ) | - | (65 | ) | ||||||||||||||||||
9. Plan Amendments | (1 | ) | (6,054 | ) | - | - | |||||||||||||||||||
10. Other Adjustment | 264 | - | 37 | - | |||||||||||||||||||||
11. Benefit Obligation at End of Year | $ | 379,324 | $ | 317,606 | $ | 18,225 | $ | 15,764 | |||||||||||||||||
(1) In 2014, includes lump sum payments of $11.8 million from our pension plan to eligible participants, which were former employees with vested benefits. In 2013, includes lump sum payments of $13.8 million from our pension plan to eligible participants, which were former employees with vested benefits of $200 thousand or less. | |||||||||||||||||||||||||
Change in plan assets | The changes in the fair value of the net assets available for plan benefits are as follows: | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Plan Assets | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Fair Value of Plan Assets at Beginning of Year | $ | 355,704 | $ | 340,335 | $ | 62,298 | $ | 49,391 | |||||||||||||||||
2. Company Contributions | 9,504 | 10,275 | - | - | |||||||||||||||||||||
3. Plan Participants' Contributions | - | - | 336 | 299 | |||||||||||||||||||||
4. Benefit Payments from Fund | (21,539 | ) | (22,497 | ) | (645 | ) | (871 | ) | |||||||||||||||||
5. Benefit Payments paid directly by Company | (1,404 | ) | (275 | ) | - | (65 | ) | ||||||||||||||||||
6. Actual Return on Assets | 36,436 | 27,866 | 5,250 | 13,778 | |||||||||||||||||||||
7. Other Adjustment | - | - | (299 | ) | (234 | ) | |||||||||||||||||||
8. Fair Value of Plan Assets at End of Year | $ | 378,701 | $ | 355,704 | $ | 66,940 | $ | 62,298 | |||||||||||||||||
Change in accumulated other comprehensive income (AOCI) | Pension and Supplemental | Other Postretirement | |||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Change in Accumulated Other Comprehensive Income (AOCI) | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. AOCI in Prior Year | $ | 45,143 | $ | 108,436 | $ | (41,377 | ) | $ | (36,602 | ) | |||||||||||||||
2. Increase/(Decrease) in AOCI | |||||||||||||||||||||||||
a. Recognized during year - Prior Service (Cost)/Credit | 930 | (503 | ) | 6,649 | 6,649 | ||||||||||||||||||||
b. Recognized during year - Net Actuarial (Losses)/Gains | (1,083 | ) | (6,145 | ) | 435 | - | |||||||||||||||||||
c. Occurring during year - Prior Service Cost | (1 | ) | (6,054 | ) | - | - | |||||||||||||||||||
d. Occurring during year - Net Actuarial Losses/(Gains) | 44,703 | (50,574 | ) | 782 | (11,411 | ) | |||||||||||||||||||
f. Occuring during year - Net Settlement Losses/(Gains) | (302 | ) | - | - | - | ||||||||||||||||||||
e. Other adjustments | - | (17 | ) | - | (13 | ) | |||||||||||||||||||
3. AOCI in Current Year | $ | 89,390 | $ | 45,143 | $ | (33,511 | ) | $ | (41,377 | ) | |||||||||||||||
Amortizations expected to be recognized during next fiscal year | Amortizations Expected to be Recognized During Next Fiscal Year Ending | ||||||||||||||||||||||||
12/31/15 | 12/31/15 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
1. Amortization of Net Transition Obligation/(Asset) | $ | - | $ | - | |||||||||||||||||||||
2. Amortization of Prior Service Cost/(Credit) | (846 | ) | (6,649 | ) | |||||||||||||||||||||
3. Amortization of Net Losses/(Gains) | 4,837 | (142 | ) | ||||||||||||||||||||||
Actuarial assumptions | The projected benefit obligations, net periodic benefit costs and accumulated postretirement benefit obligation for the plans were determined using the following weighted average assumptions. | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Actuarial Assumptions | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
Weighted-Average Assumptions Used to Determine | |||||||||||||||||||||||||
Benefit Obligations at year end | |||||||||||||||||||||||||
1. Discount Rate | 4.25 | % | 5.15 | % | 4 | % | 4.75 | % | |||||||||||||||||
2. Rate of Compensation Increase | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
Weighted-Average Assumptions Used to Determine | |||||||||||||||||||||||||
Net Periodic Benefit Cost for Year | |||||||||||||||||||||||||
1. Discount Rate | 5.15 | % | 4.25 | % | 4.75 | % | 3.85 | % | |||||||||||||||||
2. Expected Long-term Return on Plan Assets | 6 | % | 6 | % | 7.5 | % | 7.5 | % | |||||||||||||||||
3. Rate of Compensation Increase | 3 | % | 3 | % | N/A | N/A | |||||||||||||||||||
Assumed Health Care Cost Trend Rates at year end | |||||||||||||||||||||||||
1. Health Care Cost Trend Rate Assumed for Next Year | N/A | N/A | 7 | % | 7 | % | |||||||||||||||||||
2. Rate to Which the Cost Trend Rate is Assumed to Decline (Ultimate Trend Rate) | N/A | N/A | 5 | % | 5 | % | |||||||||||||||||||
3. Year That the Rate Reaches the Ultimate Trend Rate | N/A | N/A | 2019 | 2018 | |||||||||||||||||||||
Weighted-average asset allocations | The year-end asset allocations of the plans are as follows: | ||||||||||||||||||||||||
Other Postretirement | |||||||||||||||||||||||||
Pension Plan | Benefits | ||||||||||||||||||||||||
Plan Assets | |||||||||||||||||||||||||
12/31/14 | 12/31/13 | 12/31/14 | 12/31/13 | ||||||||||||||||||||||
Allocation of Assets at year end | |||||||||||||||||||||||||
1. Equity Securities | 22 | % | 43 | % | 100 | % | 100 | % | |||||||||||||||||
2. Debt Securities | 78 | % | 57 | % | 0 | % | 0 | % | |||||||||||||||||
3. Total | 100 | % | 100 | % | 100 | % | 100 | % | |||||||||||||||||
Minimum and maximum allocation ranges for fixed income securities and equity securities | The primary focus in developing asset allocation ranges for the portfolio is the assessment of the portfolio's investment objectives and the level of risk that is acceptable to obtain those objectives. To achieve these goals the minimum and maximum allocation ranges for fixed income securities and equity securities are: | ||||||||||||||||||||||||
Minimum | Maximum | ||||||||||||||||||||||||
Equities (long only) | 70 | % | 100 | % | |||||||||||||||||||||
Real estate | 0 | % | 15 | % | |||||||||||||||||||||
Commodities | 0 | % | 10 | % | |||||||||||||||||||||
Fixed income/Cash | 0 | % | 10 | % | |||||||||||||||||||||
Actual and estimated future contributions and actual and estimated future benefit payments | The following tables show the current and estimated future contributions and benefit payments. | ||||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Company Contributions | |||||||||||||||||||||||||
12/31/14 | 12/31/14 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Company Contributions for the Year Ending: | |||||||||||||||||||||||||
1. Current | $ | 9,504 | $ | - | |||||||||||||||||||||
2. Current + 1 | 17,000 | - | |||||||||||||||||||||||
Pension and Supplemental | Other Postretirement | ||||||||||||||||||||||||
Executive Retirement Plans | Benefits | ||||||||||||||||||||||||
Benefit Payments (Total) | |||||||||||||||||||||||||
12/31/14 | 12/31/14 | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Actual Benefit Payments for the Year Ending: | |||||||||||||||||||||||||
1. Current | $ | 22,942 | $ | 272 | |||||||||||||||||||||
Expected Benefit Payments for the Year Ending: | |||||||||||||||||||||||||
2. Current + 1 | 22,966 | 781 | |||||||||||||||||||||||
3. Current + 2 | 23,159 | 837 | |||||||||||||||||||||||
4. Current + 3 | 24,356 | 912 | |||||||||||||||||||||||
5. Current + 4 | 25,683 | 1,136 | |||||||||||||||||||||||
6. Current + 5 | 27,217 | 1,238 | |||||||||||||||||||||||
7. Current + 6 - 10 | 135,585 | 8,138 | |||||||||||||||||||||||
Effect of a 1% change in the health care trend rate assumption | A 1% point change in the health care trend rate assumption would have the following effects on other postretirement benefits: | ||||||||||||||||||||||||
1-Percentage | 1-Percentage | ||||||||||||||||||||||||
Point Increase | Point Decrease | ||||||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Effect on total service and interest cost components | $ | 259 | $ | (201 | ) | ||||||||||||||||||||
Effect on postretirement benefit obligation | 2,963 | (2,466 | ) | ||||||||||||||||||||||
Pension Plan [Member] | |||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | |||||||||||||||||||||||||
Fair value of plan assets | The following table sets forth by level, within the fair value hierarchy, the pension plan assets at fair value as of December 31, 2014 and 2013. | ||||||||||||||||||||||||
Assets at Fair Value as of December 31, 2014 | |||||||||||||||||||||||||
Pension Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 9,913 | $ | - | $ | - | $ | 9,913 | |||||||||||||||||
Corporate Bonds | - | 200,732 | - | 200,732 | |||||||||||||||||||||
U.S. Government Securities | 5,327 | 1,234 | - | 6,561 | |||||||||||||||||||||
Municipals | - | 65,214 | - | 65,214 | |||||||||||||||||||||
Foreign Bonds | - | 23,028 | - | 23,028 | |||||||||||||||||||||
ETF's | 5,636 | - | - | 5,636 | |||||||||||||||||||||
Pooled Equity Accounts | - | 67,617 | - | 67,617 | |||||||||||||||||||||
Total Assets at fair value | $ | 20,876 | $ | 357,825 | $ | - | $ | 378,701 | |||||||||||||||||
Assets at Fair Value as of December 31, 2013 | |||||||||||||||||||||||||
Pension Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 51,240 | $ | - | $ | - | $ | 51,240 | |||||||||||||||||
International Mutual Funds | 39,814 | - | - | 39,814 | |||||||||||||||||||||
Common Stocks | 60,332 | - | - | 60,332 | |||||||||||||||||||||
Corporate Bonds | - | 134,012 | - | 134,012 | |||||||||||||||||||||
U.S. Government Securities | 9,574 | 9,245 | - | 18,819 | |||||||||||||||||||||
Municipals | - | 33,402 | - | 33,402 | |||||||||||||||||||||
Foreign Bonds | - | 15,961 | - | 15,961 | |||||||||||||||||||||
Foreign Stocks | 2,124 | - | - | 2,124 | |||||||||||||||||||||
Total Assets at fair value | $ | 163,084 | $ | 192,620 | $ | - | $ | 355,704 | |||||||||||||||||
Other Postretirement Benefits [Member] | |||||||||||||||||||||||||
Defined Benefit Plans and Other Postretirement Benefit Plans [Line Items] | |||||||||||||||||||||||||
Fair value of plan assets | The following table sets forth by level, within the fair value hierarchy, the postretirement plan assets at fair value as of December 31, 2014 and 2013. | ||||||||||||||||||||||||
Assets at Fair Value as of December 31, 2014 | |||||||||||||||||||||||||
Postretirement Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 50,710 | $ | - | $ | - | $ | 50,710 | |||||||||||||||||
International Mutual Funds | 16,230 | - | - | 16,230 | |||||||||||||||||||||
Total Assets at fair value | $ | 66,940 | $ | - | $ | - | $ | 66,940 | |||||||||||||||||
Assets at Fair Value as of December 31, 2013 | |||||||||||||||||||||||||
Postretirement Plan | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||
(In thousands) | |||||||||||||||||||||||||
Domestic Mutual Funds | $ | 45,585 | $ | - | $ | - | $ | 45,585 | |||||||||||||||||
International Mutual Funds | 16,713 | - | - | 16,713 | |||||||||||||||||||||
Total Assets at fair value | $ | 62,298 | $ | - | $ | - | $ | 62,298 |
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes [Abstract] | |||||||||||||
Net deferred tax assets and liabilities | Net deferred tax assets and liabilities as of December 31, 2014 and 2013 are as follows: | ||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Total deferred tax assets | $ | 933,576 | $ | 1,043,477 | |||||||||
Total deferred tax liabilities | (33,789 | ) | (42,158 | ) | |||||||||
Net deferred tax asset before valuation allowance | 899,787 | 1,001,319 | |||||||||||
Valuation allowance | (902,289 | ) | (1,004,256 | ) | |||||||||
Net deferred tax liability | $ | (2,502 | ) | $ | (2,937 | ) | |||||||
Components of the net deferred tax liability | The components of the net deferred tax liability as of December 31, 2014 and 2013 are as follows: | ||||||||||||
2014 | 2013 | ||||||||||||
(In thousands) | |||||||||||||
Unearned premium reserves | $ | 12,296 | $ | (1,073 | ) | ||||||||
Benefit plans | (13,900 | ) | (26,111 | ) | |||||||||
Net operating loss | 845,616 | 915,378 | |||||||||||
Loss reserves | 23,069 | 36,236 | |||||||||||
Unrealized (appreciation) depreciation in investments | (2,800 | ) | 29,230 | ||||||||||
Mortgage investments | 15,346 | 13,450 | |||||||||||
Deferred compensation | 11,955 | 15,994 | |||||||||||
Premium deficiency reserves | 8,313 | 16,961 | |||||||||||
Other, net | (108 | ) | 1,254 | ||||||||||
Net deferred tax asset before valuation allowance | 899,787 | 1,001,319 | |||||||||||
Valuation allowance | (902,289 | ) | (1,004,256 | ) | |||||||||
Net deferred tax liability | $ | (2,502 | ) | $ | (2,937 | ) | |||||||
Tax provision (benefit) | The effect of the change in valuation allowance on the provision for (benefit from) income taxes was as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Provision for (benefit from) income taxes before valuation allowance | $ | 91,607 | $ | (17,239 | ) | $ | (330,740 | ) | |||||
Change in valuation allowance | (88,833 | ) | 20,935 | 329,175 | |||||||||
Provision for (benefit from) income taxes | $ | 2,774 | $ | 3,696 | $ | (1,565 | ) | ||||||
Components of the provision for (benefit from) income taxes | The following summarizes the components of the provision for (benefit from) income taxes: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Current | $ | 2,391 | $ | 916 | $ | (4,251 | ) | ||||||
Deferred | 1 | 7 | 90 | ||||||||||
Other | 382 | 2,773 | 2,596 | ||||||||||
Provision for (benefit from) income taxes | $ | 2,774 | $ | 3,696 | $ | (1,565 | ) | ||||||
Reconciliation of federal statutory income tax rate | The reconciliation of the federal statutory income tax rate to the effective income tax rate is as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Federal statutory income tax rate | 35 | % | (35.0 | )% | (35.0 | ) % | |||||||
Valuation allowance | (34.9 | ) | 45.4 | 35.4 | |||||||||
Tax exempt municipal bond interest | (0.4 | ) | (3.7 | ) | (0.8 | ) | |||||||
Other, net | 1.4 | 1.3 | 0.2 | ||||||||||
Effective income tax rate | 1.1 | % | 8 | % | (0.2 | )% | |||||||
Reconciliation of unrecognized tax benefits | A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
(In thousands) | |||||||||||||
Balance at beginning of year | $ | 105,366 | $ | 104,550 | $ | 110,080 | |||||||
Additions based on tax positions related to the current year | - | - | - | ||||||||||
Additions for tax positions of prior years | 864 | 816 | 511 | ||||||||||
Reductions for tax positions of prior years | - | - | (4,041 | ) | |||||||||
Settlements | - | - | (2,000 | ) | |||||||||
Balance at end of year | $ | 106,230 | $ | 105,366 | $ | 104,550 |
Statutory_Capital_Tables
Statutory Capital (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Statutory Capital [Abstract] | |||||||||||||
Summary of amounts disclosed under statutory accounting practices | The surplus amounts included below are the combined surplus of our insurance operations as utilized in our risk-to-capital calculations. | ||||||||||||
Year Ended | Net income | Contingency | |||||||||||
December 31, | (loss) | Surplus | Reserve | ||||||||||
(In thousands) | |||||||||||||
2014 | $ | 13,203 | $ | 1,585,164 | $ | 318,247 | |||||||
2013 | (8,046 | ) | 1,584,121 | 18,558 | |||||||||
2012 | (902,878 | ) | 748,592 | 6,430 | |||||||||
Additions to the | |||||||||||||
Additions to the | surplus of other insurance | ||||||||||||
Year Ended | surplus of MGIC from | subsidiaries from | Dividends paid by MGIC | ||||||||||
December 31, | parent company funds | parent company funds | to the parent company | ||||||||||
(In thousands) | |||||||||||||
2014 | $ | - | $ | - | $ | - | |||||||
2013 | 800,000 | - | - | ||||||||||
2012 | 100,000 | - | - |
Sharebased_Compensation_Plans_
Share-based Compensation Plans (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Share-based Compensation Plans [Abstract] | |||||||||||||
Summary of restricted stock or restricted stock unit activity | A summary of restricted stock or restricted stock unit (collectively called “restricted stock”) activity during 2014 is as follows: | ||||||||||||
Weighted | |||||||||||||
Average | |||||||||||||
Grant Date | |||||||||||||
Fair Market | |||||||||||||
Value | Shares | ||||||||||||
Restricted stock outstanding at December 31, 2013 | $ | 5.15 | 3,622,707 | ||||||||||
Granted | 8.43 | 1,804,800 | |||||||||||
Vested | 5.66 | (1,368,234 | ) | ||||||||||
Forfeited | 8.44 | (206,882 | ) | ||||||||||
Restricted stock outstanding at December 31, 2014 | $ | 6.33 | 3,852,391 | ||||||||||
Summary of restricted stock or restricted stock unit activity - cash settled awards | A summary of activity related to these restricted share units for the years ended December 31, 2014, 2013 and 2012 is as follows: | ||||||||||||
2014 | 2013 | 2012 | |||||||||||
Outstanding at beginning of year | 144,146 | 294,782 | 443,950 | ||||||||||
Granted | - | - | - | ||||||||||
Vested | (144,146 | ) | (147,368 | ) | (147,968 | ) | |||||||
Forfeited | - | (3,268 | ) | (1,200 | ) | ||||||||
Outstanding at end of year | - | 144,146 | 294,782 | ||||||||||
Cash payments at vesting (in millions) | $ | 1.2 | $ | 0.4 | 0.6 |
Leases_Tables
Leases (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Leases [Abstract] | |||||
Minimum future operating lease payments | At December 31, 2014, minimum future operating lease payments are as follows (in thousands): | ||||
2015 | 1,041 | ||||
2016 | 1,000 | ||||
2017 | 467 | ||||
2018 | 231 | ||||
2019 and thereafter | 497 | ||||
Total | $ | 3,236 |
Unaudited_Quarterly_Financial_1
Unaudited Quarterly Financial Data (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Unaudited Quarterly Financial Data [Abstract] | |||||||||||||||||||||
Unaudited quarterly financial data | Quarter | Full | |||||||||||||||||||
2014:00:00 | First | Second | Third | Fourth | Year | ||||||||||||||||
(In thousands, except share data) | |||||||||||||||||||||
Net premiums earned | $ | 214,261 | $ | 207,486 | $ | 209,035 | $ | 213,589 | $ | 844,371 | |||||||||||
Investment income, net of expenses | 20,156 | 21,180 | 22,355 | 23,956 | 87,647 | ||||||||||||||||
Realized (losses) gains | (231 | ) | 522 | 632 | 434 | 1,357 | |||||||||||||||
Other revenue | 896 | 2,048 | 3,093 | 2,385 | 8,422 | ||||||||||||||||
Loss incurred, net | 122,608 | 141,141 | 115,254 | 117,074 | 496,077 | ||||||||||||||||
Underwriting and other expenses, net | 51,766 | 43,455 | 47,595 | 48,181 | 190,997 | ||||||||||||||||
Provision for income tax | 726 | 1,118 | 249 | 681 | 2,774 | ||||||||||||||||
Net income | 59,982 | 45,522 | 72,017 | 74,428 | 251,949 | ||||||||||||||||
Income per share (a) (b): | |||||||||||||||||||||
Basic | 0.18 | 0.13 | 0.21 | 0.22 | 0.74 | ||||||||||||||||
Diluted | 0.15 | 0.12 | 0.18 | 0.19 | 0.64 | ||||||||||||||||
Quarter | Full | ||||||||||||||||||||
2013:00:00 | First | Second | Third | Fourth | Year | ||||||||||||||||
(In thousands, except share data) | |||||||||||||||||||||
Net premiums earned | $ | 247,059 | $ | 237,777 | $ | 231,857 | $ | 226,358 | $ | 943,051 | |||||||||||
Investment income, net of expenses | 18,328 | 20,883 | 20,250 | 21,278 | 80,739 | ||||||||||||||||
Realized gains (losses) | 1,259 | 2,485 | (139 | ) | 2,126 | 5,731 | |||||||||||||||
Other revenue | 2,539 | 2,715 | 2,481 | 2,179 | 9,914 | ||||||||||||||||
Loss incurred, net | 266,208 | 196,274 | 180,189 | 196,055 | 838,726 | ||||||||||||||||
Underwriting and other expenses, net | 74,768 | 54,221 | 61,810 | 56,062 | 246,861 | ||||||||||||||||
Provision for income tax | 1,139 | 990 | 336 | 1,231 | 3,696 | ||||||||||||||||
Net (loss) income | (72,930 | ) | 12,375 | 12,114 | (1,407 | ) | (49,848 | ) | |||||||||||||
(Loss) income per share (a): | |||||||||||||||||||||
Basic | (0.31 | ) | 0.04 | 0.04 | (0.00 | ) | (0.16 | ) | |||||||||||||
Diluted | (0.31 | ) | 0.04 | 0.04 | (0.00 | ) | (0.16 | ) | |||||||||||||
(a) | Due to the use of weighted average shares outstanding when calculating earnings per share, the sum of the quarterly per share data may not equal the per share data for the year. | ||||||||||||||||||||
(b) | In periods where convertible debt instruments are dilutive to earnings per share the “if-converted” method of computing diluted EPS requires an interest expense adjustment, net of tax, to net income available to shareholders. This adjustment has not been reflected in the Unaudited Quarterly Financial Data presented. See Note 3 – “Summary of Significant Accounting Policies” for further discussion. |
Nature_of_Business_Details
Nature of Business (Details) (USD $) | 12 Months Ended |
Dec. 31, 2014 | |
Nature of Business [Abstract] | |
Direct domestic primary insurance in force | $164,900,000,000 |
Direct domestic primary risk in force | 42,900,000,000 |
Direct pool risk in force | 800,000,000 |
Direct pool risk in force on pool policies with aggregate loss limits | 300,000,000 |
Direct pool risk in force on pool policies with no aggregate loss limits | 500,000,000 |
Risk in force in Australia | 346,000,000 |
Coverage percentage on insurance in force in Australia (in hundredths) | 100.00% |
PMIERs effective days after publication | 180 days |
Mortgage Insurers transition period | 2 years |
Period for submission of transition plan to GSE | 90 days |
Shortfall in available assets under PMIERs | 600,000,000 |
Shortfall In available assets under PMIERs after transition period | 300,000,000 |
Estimate of credit for reinsurance in calculation of minimum required assets | 500,000,000 |
Estimate of credit for reinsurance in calculation of minimum required assets after transition period | 600,000,000 |
Holding company cash and investments | 491,000,000 |
Assets of regulated insurance affiliates of MGIC | $100,000,000 |
Basis_of_Presentation_Details
Basis of Presentation (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Jun. 30, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Basis of Presentation [Abstract] | |||||
(Increase) decrease in restricted cash | $42,900 | ($60,300) | $228 | ($17,440) | $0 |
Restricted cash and cash equivalents | $17,440 | $17,212 | $17,440 |
Summary_of_Significant_Account3
Summary of Significant Accounting Policies (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||||||||
Payment | |||||||||||||||||||
Home office and equipment [Abstract] | |||||||||||||||||||
Accumulated depreciation of home office and equipment | $54,900,000 | $53,000,000 | $54,900,000 | $53,000,000 | $51,300,000 | ||||||||||||||
Depreciation expense of home office and equipment | 2,200,000 | 1,800,000 | 1,900,000 | ||||||||||||||||
Loss Reserves [Abstract] | |||||||||||||||||||
Minimum number of payments past due to be in default | 2 | ||||||||||||||||||
Share-Based Compensation [Abstract] | |||||||||||||||||||
Minimum vesting period for share-based compensation awards (in years) | 1 year | ||||||||||||||||||
Maximum vesting period for share-based compensation awards (in years) | 3 years | ||||||||||||||||||
Basic earnings (loss) per share [Abstract] | |||||||||||||||||||
Net income (loss) | 74,428,000 | 72,017,000 | 45,522,000 | 59,982,000 | -1,407,000 | 12,114,000 | 12,375,000 | -72,930,000 | 251,949,000 | -49,848,000 | -927,079,000 | ||||||||
Average common shares outstanding (in shares) | 338,523,000 | 311,754,000 | 201,892,000 | ||||||||||||||||
Basic income (loss) per share (in dollars per share) | $0.22 | [1],[2] | $0.21 | [1],[2] | $0.13 | [1],[2] | $0.18 | [1],[2] | $0 | [1] | $0.04 | [1] | $0.04 | [1] | ($0.31) | [1] | $0.74 | ($0.16) | ($4.59) |
Diluted earnings (loss) per share [Abstract] | |||||||||||||||||||
Net income (loss) | 74,428,000 | 72,017,000 | 45,522,000 | 59,982,000 | -1,407,000 | 12,114,000 | 12,375,000 | -72,930,000 | 251,949,000 | -49,848,000 | -927,079,000 | ||||||||
Diluted income available to common shareholders | 264,146,000 | -49,848,000 | -927,079,000 | ||||||||||||||||
Weighted-average shares - Basic (in shares) | 338,523,000 | 311,754,000 | 201,892,000 | ||||||||||||||||
Effect of dilutive securities [Abstract] | |||||||||||||||||||
2% Convertible Senior Notes due 2020 | $12,197,000 | $0 | $0 | ||||||||||||||||
Unvested restricted stock (in shares) | 3,082,000 | 0 | 0 | ||||||||||||||||
Convertible debt common stock equivalents (in shares) | 71,942,000 | 0 | 0 | ||||||||||||||||
Weighted-average shares - Diluted (in shares) | 413,547,000 | 311,754,000 | 201,892,000 | ||||||||||||||||
Diluted income (loss) per share (in dollars per share) | $0.19 | [1],[2] | $0.18 | [1],[2] | $0.12 | [1],[2] | $0.15 | [1],[2] | $0 | [1] | $0.04 | [1] | $0.04 | [1] | ($0.31) | [1] | $0.64 | ($0.16) | ($4.59) |
Convertible senior notes percentage (in hundredths) | 2.00% | 2.00% | |||||||||||||||||
Participating Securities [Member] | |||||||||||||||||||
Earnings per Share [Abstract] | |||||||||||||||||||
Participating securities included weighted average number of common shares outstanding (in shares) | 100,000 | ||||||||||||||||||
Antidilutive securities excluded from weighted average number of shares (in shares) | 100,000 | 1,100,000 | |||||||||||||||||
Convertible Debt Securities [Member] | |||||||||||||||||||
Earnings per Share [Abstract] | |||||||||||||||||||
Antidilutive securities excluded from weighted average number of shares (in shares) | 54,500,000 | 126,400,000 | 60,700,000 | ||||||||||||||||
Restricted Stock Units (RSUs) [Member] | |||||||||||||||||||
Earnings per Share [Abstract] | |||||||||||||||||||
Participating securities included weighted average number of common shares outstanding (in shares) | 3,100,000 | ||||||||||||||||||
Home Office [Member] | |||||||||||||||||||
Home office and equipment [Abstract] | |||||||||||||||||||
Estimated useful life | 45 years | ||||||||||||||||||
Equipment [Member] | |||||||||||||||||||
Home office and equipment [Abstract] | |||||||||||||||||||
Estimated useful life | 5 years | ||||||||||||||||||
Data Processing Hardware [Member] | |||||||||||||||||||
Home office and equipment [Abstract] | |||||||||||||||||||
Estimated useful life | 3 years | ||||||||||||||||||
[1] | Due to the use of weighted average shares outstanding when calculating earnings per share, the sum of the quarterly per share data may not equal the per share data for the year. | ||||||||||||||||||
[2] | In periods where convertible debt instruments are dilutive to earnings per share the "if-converted" method of computing diluted EPS requires an interest expense adjustment, net of tax, to net income available to shareholders. This adjustment has not been reflected in the Unaudited Quarterly Financial Data presented. See Note 3 - "Summary of Significant Accounting Policies" for further discussion. |
Related_Party_Transactions_Det
Related Party Transactions (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Related Party Transactions [Abstract] | |||
Related party transaction amount | $0 | $0 | $0 |
Investments_Details
Investments (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Securities | Securities | ||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | $4,602,514,000 | $4,948,543,000 | |||
Total at end of period | 4,609,614,000 | 4,863,925,000 | |||
Available-for-sale Equity Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 3,003,000 | 2,908,000 | |||
Gross Unrealized Gains | 61,000 | 9,000 | |||
Gross Unrealized Losses | -9,000 | [1] | -23,000 | [1] | |
Fair Value | 3,055,000 | 2,894,000 | |||
Total Investment Portfolio [Abstract] | |||||
Amortized Cost | 4,605,517,000 | 4,951,451,000 | |||
Gross Unrealized Gains | 37,649,000 | 16,755,000 | |||
Gross Unrealized Losses | -30,497,000 | [1] | -101,387,000 | [1] | |
Fair Value | 4,612,669,000 | 4,866,819,000 | |||
Repatriation of capital to parent | 89,500,000 | ||||
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 | 83.00% | ||||
Percentage of Australian portfolio rated AA | 17.00% | ||||
Equity Value in Australian Operations | 46,000,000 | ||||
Gross unrealized losses | -30,500,000 | -101,400,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Due in one year or less | 330,602,000 | ||||
Due after one year through five years | 1,903,661,000 | ||||
Due after five years through ten years | 1,063,679,000 | ||||
Due after ten years | 350,774,000 | ||||
Total debt securities with single maturity date | 3,648,716,000 | ||||
Total at end of period | 4,602,514,000 | 4,948,543,000 | |||
Maturities, Fair Value [Abstract] | |||||
Due in one year or less | 330,982,000 | ||||
Due after one year through five years | 1,909,422,000 | ||||
Due after five years through ten years | 1,069,433,000 | ||||
Due after ten years | 356,531,000 | ||||
Total debt securities with single maturity date | 3,666,368,000 | ||||
Total at end of period | 4,609,614,000 | 4,863,925,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 1,209,256,000 | 2,687,628,000 | |||
12 months or greater | 1,035,884,000 | 406,033,000 | |||
Total investment portfolio | 2,245,140,000 | 3,093,661,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 7,388,000 | 74,583,000 | |||
12 months or greater | 23,109,000 | 26,804,000 | |||
Total investment portfolio | 30,497,000 | 101,387,000 | |||
Number of securities in unrealized loss position | 423 | 571 | |||
For securities in an unrealized loss position, percentage of weighted average fair value to amortized cost (in hundredths) | 99.00% | ||||
For securities in an unrealized loss position, percentage backed by the U.S. Government (in hundredths) | 50.00% | ||||
Recognized other than temporary impairments | 144,000 | 328,000 | 2,310,000 | ||
Investments on deposit with various states | 20,200,000 | 20,300,000 | |||
U.S. Treasury Securities and Obligations of U.S. Government Corporations and Agencies [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 349,153,000 | 663,642,000 | |||
Gross Unrealized Gains | 2,752,000 | 1,469,000 | |||
Gross Unrealized Losses | -5,130,000 | [1] | -25,521,000 | [1] | |
Total at end of period | 346,775,000 | 639,590,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 346,775,000 | 639,590,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Total at end of period | 349,153,000 | 663,642,000 | |||
Maturities, Fair Value [Abstract] | |||||
Total at end of period | 346,775,000 | 639,590,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 58,166,000 | 465,975,000 | |||
12 months or greater | 232,351,000 | 4,103,000 | |||
Total investment portfolio | 290,517,000 | 470,078,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 138,000 | 24,980,000 | |||
12 months or greater | 4,992,000 | 541,000 | |||
Total investment portfolio | 5,130,000 | 25,521,000 | |||
Obligations of U.S. States and Political Subdivisions [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 844,942,000 | 932,922,000 | |||
Gross Unrealized Gains | 12,961,000 | 5,865,000 | |||
Gross Unrealized Losses | -2,761,000 | [1] | -17,420,000 | [1] | |
Total at end of period | 855,142,000 | 921,367,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 855,142,000 | 921,367,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Total at end of period | 844,942,000 | 932,922,000 | |||
Maturities, Fair Value [Abstract] | |||||
Total at end of period | 855,142,000 | 921,367,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 166,408,000 | 503,967,000 | |||
12 months or greater | 114,465,000 | 4,226,000 | |||
Total investment portfolio | 280,873,000 | 508,193,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 1,066,000 | 17,370,000 | |||
12 months or greater | 1,695,000 | 50,000 | |||
Total investment portfolio | 2,761,000 | 17,420,000 | |||
Corporate Debt Securities [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 2,418,991,000 | 2,190,095,000 | |||
Gross Unrealized Gains | 16,325,000 | 6,313,000 | |||
Gross Unrealized Losses | -10,035,000 | [1] | -24,993,000 | [1] | |
Total at end of period | 2,425,281,000 | 2,171,415,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 2,425,281,000 | 2,171,415,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Total at end of period | 2,418,991,000 | 2,190,095,000 | |||
Maturities, Fair Value [Abstract] | |||||
Total at end of period | 2,425,281,000 | 2,171,415,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 816,555,000 | 1,238,211,000 | |||
12 months or greater | 243,208,000 | 81,593,000 | |||
Total investment portfolio | 1,059,763,000 | 1,319,804,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 5,259,000 | 20,371,000 | |||
12 months or greater | 4,776,000 | 4,622,000 | |||
Total investment portfolio | 10,035,000 | 24,993,000 | |||
Asset-Backed Securities [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 286,260,000 | 399,839,000 | |||
Gross Unrealized Gains | 535,000 | 1,100,000 | |||
Gross Unrealized Losses | -140,000 | [1] | -453,000 | [1] | |
Total at end of period | 286,655,000 | 400,486,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 286,655,000 | 400,486,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Debt securities without single maturity date | 286,260,000 | ||||
Total at end of period | 286,260,000 | 399,839,000 | |||
Maturities, Fair Value [Abstract] | |||||
Debt securities without single maturity date | 286,655,000 | ||||
Total at end of period | 286,655,000 | 400,486,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 54,491,000 | 126,991,000 | |||
12 months or greater | 11,895,000 | 7,114,000 | |||
Total investment portfolio | 66,386,000 | 134,105,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 80,000 | 387,000 | |||
12 months or greater | 60,000 | 66,000 | |||
Total investment portfolio | 140,000 | 453,000 | |||
Residential Mortgage-Backed Securities [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 329,983,000 | 383,368,000 | |||
Gross Unrealized Gains | 254,000 | 146,000 | |||
Gross Unrealized Losses | -9,000,000 | [1] | -24,977,000 | [1] | |
Total at end of period | 321,237,000 | 358,537,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 321,237,000 | 358,537,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Debt securities without single maturity date | 329,983,000 | ||||
Total at end of period | 329,983,000 | 383,368,000 | |||
Maturities, Fair Value [Abstract] | |||||
Debt securities without single maturity date | 321,237,000 | ||||
Total at end of period | 321,237,000 | 358,537,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 24,168,000 | 91,534,000 | |||
12 months or greater | 263,002,000 | 265,827,000 | |||
Total investment portfolio | 287,170,000 | 357,361,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 34,000 | 3,886,000 | |||
12 months or greater | 8,966,000 | 21,091,000 | |||
Total investment portfolio | 9,000,000 | 24,977,000 | |||
Commercial Mortgage-Backed Securities [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 276,215,000 | 277,920,000 | |||
Gross Unrealized Gains | 1,221,000 | 131,000 | |||
Gross Unrealized Losses | -2,158,000 | [1] | -6,668,000 | [1] | |
Total at end of period | 275,278,000 | 271,383,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 275,278,000 | 271,383,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Debt securities without single maturity date | 276,215,000 | ||||
Total at end of period | 276,215,000 | 277,920,000 | |||
Maturities, Fair Value [Abstract] | |||||
Debt securities without single maturity date | 275,278,000 | ||||
Total at end of period | 275,278,000 | 271,383,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 89,301,000 | 192,440,000 | |||
12 months or greater | 110,652,000 | 43,095,000 | |||
Total investment portfolio | 199,953,000 | 235,535,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 810,000 | 6,239,000 | |||
12 months or greater | 1,348,000 | 429,000 | |||
Total investment portfolio | 2,158,000 | 6,668,000 | |||
Collateralized Loan Obligations [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 61,340,000 | 61,337,000 | |||
Gross Unrealized Gains | 0 | 0 | |||
Gross Unrealized Losses | -1,264,000 | [1] | -1,042,000 | [1] | |
Total at end of period | 60,076,000 | 60,295,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 60,076,000 | 60,295,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Debt securities without single maturity date | 61,340,000 | ||||
Total at end of period | 61,340,000 | 61,337,000 | |||
Maturities, Fair Value [Abstract] | |||||
Debt securities without single maturity date | 60,076,000 | ||||
Total at end of period | 60,076,000 | 60,295,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 0 | 60,295,000 | |||
12 months or greater | 60,076,000 | 0 | |||
Total investment portfolio | 60,076,000 | 60,295,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 0 | 1,042,000 | |||
12 months or greater | 1,264,000 | 0 | |||
Total investment portfolio | 1,264,000 | 1,042,000 | |||
Debt Securities Issued by Foreign Sovereign Governments [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 35,630,000 | 39,420,000 | |||
Gross Unrealized Gains | 3,540,000 | 1,722,000 | |||
Gross Unrealized Losses | 0 | [1] | -290,000 | [1] | |
Total at end of period | 39,170,000 | 40,852,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 39,170,000 | 40,852,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Total at end of period | 35,630,000 | 39,420,000 | |||
Maturities, Fair Value [Abstract] | |||||
Total at end of period | 39,170,000 | 40,852,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 0 | 7,203,000 | |||
12 months or greater | 0 | 0 | |||
Total investment portfolio | 0 | 7,203,000 | |||
Continuous Unrealized Loss Portion, Unrealized Loses [Abstract] | |||||
Less than 12 months | 0 | 290,000 | |||
12 months or greater | 0 | 0 | |||
Total investment portfolio | 0 | 290,000 | |||
Total Debt Securities [Member] | |||||
Available-for-sale Debt Securities, Amortized Cost Basis [Abstract] | |||||
Amortized Cost | 4,602,514,000 | 4,948,543,000 | |||
Gross Unrealized Gains | 37,588,000 | 16,746,000 | |||
Gross Unrealized Losses | -30,488,000 | [1] | -101,364,000 | [1] | |
Total at end of period | 4,609,614,000 | 4,863,925,000 | |||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 4,609,614,000 | 4,863,925,000 | |||
Maturities, Amortized Cost [Abstract] | |||||
Total at end of period | 4,602,514,000 | 4,948,543,000 | |||
Maturities, Fair Value [Abstract] | |||||
Total at end of period | 4,609,614,000 | 4,863,925,000 | |||
Equity Securities [Member] | |||||
Total Investment Portfolio [Abstract] | |||||
Fair Value | 3,055,000 | 2,894,000 | |||
Continuous Unrealized Loss Portion, Fair Value [Abstract] | |||||
Less than 12 months | 167,000 | 1,012,000 | |||
12 months or greater | 235,000 | 75,000 | |||
Total investment portfolio | 402,000 | 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] | There were no other-than-temporary impairment losses recorded in other comprehensive income (loss) at December 31, 2014 and 2013. |
Investments_Investment_Income_
Investments, Investment Income By Category (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||||||||||
Investment income | $90,554 | $83,425 | $124,201 | ||||||||
Investment expenses | -2,907 | -2,686 | -2,561 | ||||||||
Net investment income | 23,956 | 22,355 | 21,180 | 20,156 | 21,278 | 20,250 | 20,883 | 18,328 | 87,647 | 80,739 | 121,640 |
Fixed Maturities [Member] | |||||||||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||||||||||
Investment income | 89,437 | 82,168 | 122,886 | ||||||||
Equity Securities [Member] | |||||||||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||||||||||
Investment income | 227 | 229 | 200 | ||||||||
Cash Equivalents [Member] | |||||||||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||||||||||
Investment income | 179 | 353 | 333 | ||||||||
Other [Member] | |||||||||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | |||||||||||
Investment income | $711 | $675 | $782 |
Investments_Gain_Loss_on_Inves
Investments, Gain (Loss) on Investments (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Gain (Loss) on Investments [Line Items] | |||||||||||
Net realized gains (losses) on securities | $434 | $632 | $522 | ($231) | $2,126 | ($139) | $2,485 | $1,259 | $1,357 | $5,731 | $195,409 |
Change in net unrealized gains (losses) | 91,784 | -126,173 | -78,546 | ||||||||
Gross realized gains, gross realized losses and impairment losses [Abstract] | |||||||||||
Gross realized gains | 4,966 | 11,043 | 213,827 | ||||||||
Gross realized losses | -3,465 | -4,984 | -16,108 | ||||||||
Impairment losses | -144 | -328 | -2,310 | ||||||||
Net realized gains (losses) on securities | 434 | 632 | 522 | -231 | 2,126 | -139 | 2,485 | 1,259 | 1,357 | 5,731 | 195,409 |
Available-for-Sale Securities [Member] | |||||||||||
Gain (Loss) on Investments [Line Items] | |||||||||||
Net realized gains (losses) on securities | 1,357 | 5,731 | 195,409 | ||||||||
Gross realized gains, gross realized losses and impairment losses [Abstract] | |||||||||||
Net realized gains (losses) on securities | 1,357 | 5,731 | 195,409 | ||||||||
Available-for-Sale Securities [Member] | Fixed Maturities [Member] | |||||||||||
Gain (Loss) on Investments [Line Items] | |||||||||||
Net realized gains (losses) on securities | 1,000 | 3,274 | 195,652 | ||||||||
Change in net unrealized gains (losses) | 91,718 | -126,020 | -78,604 | ||||||||
Gross realized gains, gross realized losses and impairment losses [Abstract] | |||||||||||
Net realized gains (losses) on securities | 1,000 | 3,274 | 195,652 | ||||||||
Available-for-Sale Securities [Member] | Equity Securities [Member] | |||||||||||
Gain (Loss) on Investments [Line Items] | |||||||||||
Net realized gains (losses) on securities | 356 | 1,068 | 487 | ||||||||
Change in net unrealized gains (losses) | 66 | -153 | 58 | ||||||||
Gross realized gains, gross realized losses and impairment losses [Abstract] | |||||||||||
Net realized gains (losses) on securities | 356 | 1,068 | 487 | ||||||||
Available-for-Sale Securities [Member] | Other [Member] | |||||||||||
Gain (Loss) on Investments [Line Items] | |||||||||||
Net realized gains (losses) on securities | 1 | 1,389 | -730 | ||||||||
Change in net unrealized gains (losses) | 0 | 0 | 0 | ||||||||
Gross realized gains, gross realized losses and impairment losses [Abstract] | |||||||||||
Net realized gains (losses) on securities | $1 | $1,389 | ($730) |
Fair_Value_Measurements_Detail
Fair Value Measurements (Details) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 | ||
In Thousands, unless otherwise specified | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Total investments | $4,612,669 | $4,866,819 | ||
Real estate acquired | 12,658 | [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 | 230,728 | 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 | 4,379,774 | 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 | 2,167 | 2,744 | ||
Real estate acquired | 12,658 | [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 | 346,775 | 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 | 188,824 | 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 | 157,951 | 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 | 855,142 | 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 | 853,296 | 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 | 1,846 | 2,423 | ||
Corporate Debt Securities [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Total investments | 2,425,281 | 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 | 2,425,281 | 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 | 286,655 | 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 | 286,655 | 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 | 321,237 | 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 | 321,237 | 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 | 275,278 | 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 | 275,278 | 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 | 60,076 | 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 | 60,076 | 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 | 39,170 | 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 | 39,170 | 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 | 4,609,614 | 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 | 227,994 | 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 | 4,379,774 | 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 | 1,846 | 2,423 | ||
Equity Securities [Member] | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Total investments | 3,055 | 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 | 2,734 | 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 sheets. |
Fair_Value_Measurements_Unobse
Fair Value Measurements, Unobservable Input Reconciliation (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as net impairment losses recognized in earnings | $144 | $328 | $2,310 |
State premium tax credit investments, average maturity | 5 years | ||
Annual average discount rate (in hundredths) | 7.30% | ||
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 | 2,423 | 3,130 | 114,226 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as realized investment gains (losses), net | 0 | -8,669 | |
Included in earnings and reported as net impairment losses recognized in earnings | 0 | ||
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 |
Included in other comprehensive income | 5,630 | ||
Purchases | 30 | 30 | 27 |
Sales | -607 | -737 | -108,084 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Balance at end of period | 1,846 | 2,423 | 3,130 |
Amount of total losses included in earnings for the period attributable to the change in unrealized losses on assets still held at period end | 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 | 60,228 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as realized investment gains (losses), net | -225 | -3,129 | |
Included in earnings and reported as net impairment losses recognized in earnings | -2,310 | ||
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 |
Included in other comprehensive income | 733 | ||
Purchases | 0 | 0 | 0 |
Sales | 0 | -16,889 | -38,408 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Balance at end of period | 0 | 0 | 17,114 |
Amount of total losses included in earnings for the period attributable to the change in unrealized losses on assets still held at period end | 0 | 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 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as realized investment gains (losses), net | 0 | 0 | |
Included in earnings and reported as net impairment losses recognized in earnings | 0 | ||
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 |
Included in other comprehensive income | 0 | ||
Purchases | 0 | 0 | 0 |
Sales | 0 | 0 | 0 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Balance at end of period | 321 | 321 | 321 |
Amount of total losses included in earnings for the period attributable to the change in unrealized losses on assets still held at period end | 0 | 0 | 0 |
Total Investments [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Balance at beginning of period | 2,744 | 20,565 | 174,775 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as realized investment gains (losses), net | -225 | -11,798 | |
Included in earnings and reported as net impairment losses recognized in earnings | -2,310 | ||
Included in earnings and reported as losses incurred, net | 0 | 0 | 0 |
Included in other comprehensive income | 6,363 | ||
Purchases | 30 | 30 | 27 |
Sales | -607 | -17,626 | -146,492 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Balance at end of period | 2,167 | 2,744 | 20,565 |
Amount of total losses included in earnings for the period attributable to the change in unrealized losses on assets still held at period end | 0 | 0 | 0 |
Real Estate Acquired [Member] | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Balance at beginning of period | 13,280 | 3,463 | 1,621 |
Total realized/unrealized gains (losses) [Abstract] | |||
Included in earnings and reported as realized investment gains (losses), net | 0 | 0 | |
Included in earnings and reported as net impairment losses recognized in earnings | 0 | ||
Included in earnings and reported as losses incurred, net | -4,129 | -4,959 | -1,126 |
Included in other comprehensive income | 0 | ||
Purchases | 42,247 | 39,188 | 11,991 |
Sales | -38,740 | -24,412 | -9,023 |
Transfers into Level 3 | 0 | 0 | 0 |
Transfers out of Level 3 | 0 | 0 | 0 |
Balance at end of period | 12,658 | 13,280 | 3,463 |
Amount of total losses included in earnings for the period attributable to the change in unrealized losses on assets still held at period end | $0 | $0 | $0 |
Debt_Details
Debt (Details) (USD $) | 12 Months Ended | |||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Mar. 31, 2013 | |
Debt Instrument [Line Items] | ||||
Stated interest rate (in hundredths) | 2.00% | |||
Net proceeds from convertible senior notes | $0 | $484,625,000 | $0 | |
Annual rate (in hundredths) | 2.00% | |||
Holding company cash and investments | 491,000,000 | |||
Unrealized gain loss on holding company investments | 2,500,000 | |||
Modified duration of holding company investments | 2 years 10 months 24 days | |||
Par Value [Member] | ||||
Debt: [Abstract] | ||||
Senior Notes | 61,953,000 | 82,883,000 | ||
Convertible Senior Notes due 2017 | 345,000,000 | 345,000,000 | ||
Convertible Senior Notes due 2020 | 500,000,000 | 500,000,000 | ||
Convertible Junior Subordinated Debentures | 389,522,000 | 389,522,000 | ||
Total Debt | 1,296,475,000 | 1,317,405,000 | ||
Fair Value [Member] | ||||
Debt: [Abstract] | ||||
Senior Notes | 63,618,000 | 85,991,000 | ||
Convertible Senior Notes due 2017 | 387,997,000 | 388,988,000 | ||
Convertible Senior Notes due 2020 | 735,075,000 | 685,625,000 | ||
Convertible Junior Subordinated Debentures | 500,201,000 | 439,186,000 | ||
Total Debt | 1,686,891,000 | 1,599,790,000 | ||
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||||
Debt: [Abstract] | ||||
Senior Notes | 0 | 85,991,000 | ||
Convertible Senior Notes due 2017 | 0 | 388,988,000 | ||
Convertible Senior Notes due 2020 | 0 | 685,625,000 | ||
Convertible Junior Subordinated Debentures | 0 | 0 | ||
Total Debt | 0 | 1,160,604,000 | ||
Significant Other Observable Inputs (Level 2) [Member] | ||||
Debt: [Abstract] | ||||
Senior Notes | 63,618,000 | 0 | ||
Convertible Senior Notes due 2017 | 387,997,000 | 0 | ||
Convertible Senior Notes due 2020 | 735,075,000 | 0 | ||
Convertible Junior Subordinated Debentures | 500,201,000 | 439,186,000 | ||
Total Debt | 1,686,891,000 | 439,186,000 | ||
Significant Unobservable Inputs (Level 3) [Member] | ||||
Debt: [Abstract] | ||||
Senior Notes | 0 | 0 | ||
Convertible Senior Notes due 2017 | 0 | 0 | ||
Convertible Senior Notes due 2020 | 0 | 0 | ||
Convertible Junior Subordinated Debentures | 0 | 0 | ||
Total Debt | 0 | 0 | ||
Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Repurchase of debt instrument | 20,900,000 | 17,200,000 | ||
Minimum percentage of consolidated shareholders' equity that determines designated subsidiary status (in hundredths) | 15.00% | |||
Interest payments made | 3,600,000 | 5,100,000 | ||
Senior Notes [Member] | Senior Notes Due 2015 [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal amount | 61,900,000 | 82,900,000 | ||
Stated interest rate (in hundredths) | 5.38% | 5.38% | ||
Maturity date | 1-Nov-15 | 1-Nov-15 | ||
Annual rate (in hundredths) | 5.38% | 5.38% | ||
Convertible Senior Notes Due 2017 [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal amount | 345,000,000 | 345,000,000 | ||
Stated interest rate (in hundredths) | 5.00% | 5.00% | ||
Maturity date | 1-May-17 | 1-May-17 | ||
Interest payments made | 17,300,000 | 17,300,000 | ||
Conversion rate (in shares per $1,000 note) | 74.4186 | |||
Principal amount of notes used in determining conversion rate | 1,000 | |||
Initial conversion price (in dollars per share) | $13.44 | |||
Annual rate (in hundredths) | 5.00% | 5.00% | ||
Convertible Senior Notes - Due April 2020 [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal amount | 500,000,000 | 500,000,000 | 500,000,000 | |
Stated interest rate (in hundredths) | 2.00% | 2.00% | 2.00% | |
Maturity date | 1-Apr-20 | 1-Apr-20 | ||
Interest payments made | 10,000,000 | 5,500,000 | ||
Conversion rate (in shares per $1,000 note) | 143.8332 | |||
Principal amount of notes used in determining conversion rate | 1,000 | |||
Initial conversion price (in dollars per share) | $6.95 | |||
130% of conversion price (in dollars per share) | $9.03 | |||
Net proceeds from convertible senior notes | 484,600,000 | |||
Redemption price, percentage (in hundredths) | 100.00% | |||
Percentage of conversion price (in hundredths) | 130.00% | |||
Minimum number of trading days | 20 days | |||
Maximum number of trading days | 30 days | |||
Annual rate (in hundredths) | 2.00% | 2.00% | 2.00% | |
Convertible Junior Subordinated Debentures Due 2063 [Member] | ||||
Debt Instrument [Line Items] | ||||
Outstanding principal amount | 389,500,000 | 389,500,000 | ||
Stated interest rate (in hundredths) | 9.00% | 9.00% | ||
Maturity date | 1-Apr-63 | |||
Interest payments made | 35,100,000 | 53,400,000 | ||
Conversion rate (in shares per $1,000 note) | 74.0741 | |||
Principal amount of notes used in determining conversion rate | 1,000 | |||
Initial conversion price (in dollars per share) | $13.50 | |||
Redemption price, percentage (in hundredths) | 100.00% | |||
Percentage of conversion price (in hundredths) | 130.00% | |||
Minimum number of trading days | 20 days | |||
Maximum number of trading days | 30 days | |||
Minimum number of consecutive interest periods for which interest payments may be deferred | 1 | |||
Maximum period for which interest payments may be deferred without giving rise to an event of default | 10 years | |||
Annual rate (in hundredths) | 9.00% | 9.00% | ||
Interest payment deferred | 18,300,000 | |||
Interest payment due on the debentures | $17,500,000 | |||
Period in which reasonable commercial efforts must begin, maximum | 1 day | |||
Anniversary payment release of the start of the interest deferral to the Alternative Payment Mechanism in lieu of the final maturity of the debentures | tenth | |||
Period in which reasonable commercial efforts must begin, minimum | fifth anniversary of the interest payment date | |||
Net proceeds cap (in hundredths) | 2.00% | |||
Maximum number of shares of common stock issuable under the Alternative Payment Mechanism (in shares) | 10,000,000 | |||
Maximum percentage of aggregate principal amount of the debentures (in hundredths) | 25.00% | |||
Period preceding election to convert | 5 days |
Loss_Reserves_Details
Loss Reserves (Details) (USD $) | 12 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Loan | Loan | Loan | ||||
Loss Reserve [Roll Forward] | ||||||
Reserve at beginning of year | $3,061,401,000 | $4,056,843,000 | $4,557,512,000 | |||
Less reinsurance recoverable | 64,085,000 | 104,848,000 | 154,607,000 | |||
Net reserve at beginning of year | 2,997,316,000 | 3,951,995,000 | 4,402,905,000 | |||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Current year | 596,436,000 | 898,413,000 | 1,494,133,000 | |||
Prior years | -100,359,000 | [1] | -59,687,000 | [1] | 573,120,000 | [1] |
Subtotal | 496,077,000 | 838,726,000 | 2,067,253,000 | |||
Losses and LAE paid in respect of default notices received in [Abstract] | ||||||
Current year | 32,919,000 | 73,470,000 | 134,509,000 | |||
Prior years | 1,121,508,000 | 1,722,923,000 | 2,389,985,000 | |||
Reinsurance terminations | 0 | [2] | -2,988,000 | [2] | -6,331,000 | [2] |
Subtotal | 1,154,427,000 | 1,793,405,000 | 2,518,163,000 | |||
Net reserve at end of year | 2,338,966,000 | 2,997,316,000 | 3,951,995,000 | |||
Plus reinsurance recoverables | 57,841,000 | 64,085,000 | 104,848,000 | |||
Reserve at end of year | 2,396,807,000 | 3,061,401,000 | 4,056,843,000 | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | -100,359,000 | [1] | -59,687,000 | [1] | 573,120,000 | [1] |
Historical average period for uncured default to develop into paid claim | 12 months | |||||
Premium refund liability, expected claim payments | 115,000,000 | 131,000,000 | ||||
Primary Default Inventory [Roll Forward] | ||||||
Default inventory at beginning of period | 103,328 | 139,845 | 175,639 | |||
New Notices | 88,844 | 106,823 | 133,232 | |||
Cures | -87,278 | -104,390 | -120,248 | |||
Paids (including those charged to a deductible or captive) | -23,494 | -34,738 | -45,741 | |||
Rescissions and denials | -1,306 | -1,939 | -3,037 | |||
Items removed from inventory resulting from the Countrywide settlement on GSE loans | -193 | -2,273 | 0 | |||
Default inventory at end of period | 79,901 | 103,328 | 139,845 | |||
Number of rescindable loans affected by Company's decision to voluntarily suspend rescissions | 1,425 | |||||
Pool insurance notice inventory [Abstract] | ||||||
Pool insurance notice inventory (in number of loans) | 3,797 | 6,563 | 8,594 | |||
Aging of the Primary Default Inventory [Abstract] | ||||||
3 months or less | 15,319 | 18,941 | 23,282 | |||
3 months or less (in hundredths) | 19.00% | 18.00% | 17.00% | |||
4 - 11 months | 19,710 | 24,514 | 34,688 | |||
4 - 11 months (in hundredths) | 25.00% | 24.00% | 25.00% | |||
12 months or more | 44,872 | 59,873 | 81,875 | |||
12 months or more (in hundredths) | 56.00% | 58.00% | 58.00% | |||
Total primary default inventory | 79,901 | 103,328 | 139,845 | |||
Total primary default inventory (in hundredths) | 100.00% | 100.00% | 100.00% | |||
Primary claims received inventory included in ending default inventory | 4,746 | [3] | 6,948 | [3] | 11,731 | [3] |
Primary claims received inventory included in ending default inventory (in hundredths) | 6.00% | [3] | 7.00% | [3] | 8.00% | [3] |
Number of payments delinquent [Abstract] | ||||||
3 payments or less | 23,253 | 28,095 | 34,245 | |||
3 payments or less (in hundredths) | 29.00% | 27.00% | 24.00% | |||
4 - 11 payments | 19,427 | 24,605 | 34,458 | |||
4 - 11 payments (in hundredths) | 24.00% | 24.00% | 25.00% | |||
12 payments or more | 37,221 | 50,628 | 71,142 | |||
12 payments or more (in hundredths) | 47.00% | 49.00% | 51.00% | |||
Total primary default inventory | 79,901 | 103,328 | 139,845 | |||
Total primary default inventory (in hundredths) | 100.00% | 100.00% | 100.00% | |||
Premium refund liability, expected future rescissions | 28,000,000 | 15,000,000 | ||||
Freddie Mac's Disagreement on Aggregate Loss Limit [Member] | ||||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Obligations under the disputed policies | 267,500,000 | |||||
Amount paid as per settlement agreement | 100,000,000 | |||||
Remaining amount of unpaid settlement agreement | 167,500,000 | |||||
Number of installments to pay settlement agreement amount | 48 | |||||
Pool Policy Settlement [Member] | ||||||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Prior years | 0 | [4] | 0 | [4] | 267,000,000 | [4] |
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | 0 | [4] | 0 | [4] | 267,000,000 | [4] |
(Decrease) Increase in Estimated Claim Rate on primary Defaults [Member] | ||||||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Prior years | -43,000,000 | 10,000,000 | 260,000,000 | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | -43,000,000 | 10,000,000 | 260,000,000 | |||
Percentage of prior year default inventory resolved (in hundredths) | 58.00% | 59.00% | 55.00% | |||
Decrease in Estimated Severity, Primary Defaults [Member] | ||||||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Prior years | -35,000,000 | -50,000,000 | -70,000,000 | |||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | -35,000,000 | -50,000,000 | -70,000,000 | |||
Change in Estimates Related to Pool Reserves, LAE Reserves, Reinsurance and Other [Member] | ||||||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Prior years | -22,000,000 | [5] | -20,000,000 | [5] | 116,000,000 | [5] |
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | -22,000,000 | [5] | -20,000,000 | [5] | 116,000,000 | [5] |
Increase (Decrease) Related To Probable Settlements [Member] | ||||||
Losses and LAE incurred in respect of default notices received in [Abstract] | ||||||
Prior years | 100,000,000 | |||||
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items] | ||||||
Change in loss reserves | $100,000,000 | |||||
[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. See table below regarding prior year loss development. | |||||
[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. (See Note 11 - "Reinsurance") | |||||
[3] | Our claims received inventory includes suspended rescissions, as we have voluntarily suspended rescissions of coverage related to loans that we believed would be included in a potential resolution. As of December 31, 2014, rescissions of coverage on approximately 1,425 loans had been voluntarily suspended. | |||||
[4] | See below for a discussion of our settlement with Freddie Mac. | |||||
[5] | Includes approximately $100 million related to probable settlements regarding our claims paying practices in 2012. |
Premium_Deficiency_Reserve_Det
Premium Deficiency Reserve (Details) (USD $) | 12 Months Ended | |||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||
Premium Deficiency Reserve [Abstract] | ||||||
Present value of expected future premium | $387,000,000 | $432,000,000 | $445,000,000 | |||
Present value of expected future paid losses and expenses | -941,000,000 | -1,101,000,000 | -1,285,000,000 | |||
Net present value of future cash flows | -554,000,000 | -669,000,000 | -840,000,000 | |||
Established loss reserves | 530,000,000 | 621,000,000 | 766,000,000 | |||
Net deficiency | -23,751,000 | -48,461,000 | -73,781,000 | |||
Discount rate utilized | 2.10% | 1.60% | 1.30% | |||
Change in premium deficiency reserve | 24,000,000 | 26,000,000 | 61,000,000 | |||
Premium Deficiency Reserve [Roll Forward] | ||||||
Premium Deficiency Reserve at beginning of year | -48,461,000 | -73,781,000 | -135,000,000 | |||
Paid claims and loss adjustment expenses | 169,000,000 | 214,000,000 | 279,000,000 | |||
Decrease in loss reserves | -91,000,000 | -145,000,000 | -60,000,000 | |||
Premium earned | -79,000,000 | -96,000,000 | -102,000,000 | |||
Effects of present valuing on future premiums, losses and expenses | -2,000,000 | -1,000,000 | -1,000,000 | |||
Change in premium deficiency reserve to reflect actual premium, losses and expenses recognized | -3,000,000 | -28,000,000 | 116,000,000 | |||
Change in premium deficiency reserve to reflect change in assumptions relating to future premiums, losses expenses and discount rate | 27,000,000 | [1] | 54,000,000 | [1] | -55,000,000 | [1] |
Premium Deficiency Reserve at end of year | ($23,751,000) | ($48,461,000) | ($73,781,000) | |||
[1] | A positive (negative) number for changes in assumptions relating to premiums, losses, expenses and discount rate indicates a redundancy (deficiency) of prior premium deficiency reserves. |
Reinsurance_Details
Reinsurance (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Mortgage | Mortgage | ||||||||||||
Reinsurance [Abstract] | |||||||||||||
Number of other mortgage insurers agreeing to similar CFPB settlements | 3 | 3 | |||||||||||
Period of existing captive reinsurance agreement | 10 years | 10 years | |||||||||||
Reinsurance recoverable on loss reserves related to captive agreements | $45,000,000 | $64,000,000 | $45,000,000 | $64,000,000 | |||||||||
Fair value of trust fund assets under our captive agreements | 198,000,000 | 226,000,000 | 198,000,000 | 226,000,000 | |||||||||
Fair value of trust fund assets under captive agreements, no reinsurance recoverable on loss reserves | 9,000,000 | 23,000,000 | 9,000,000 | 23,000,000 | |||||||||
Trust fund assets transferred to us as a result of captive terminations | 3,000,000 | ||||||||||||
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% | ||||||||||||
Reinsurance agreement addendum, prepaid reinsurance premiums | 16,800,000 | 23,900,000 | 16,800,000 | 23,900,000 | |||||||||
Profit commission receivable | 91,500,000 | 2,368,000 | 91,500,000 | 2,368,000 | |||||||||
Premiums Written and Earned [Abstract] | |||||||||||||
Ceded premiums written, net of profit commission | 100,031,000 | 49,672,000 | |||||||||||
Ceded premiums earned, net of profit commission | 88,528,000 | 13,821,000 | |||||||||||
Ceded losses incurred | 15,163,000 | 176,000 | |||||||||||
Ceding commissions | 37,833,000 | [1] | 10,408,000 | [1] | |||||||||
Premiums earned [Abstract] | |||||||||||||
Direct | 950,973,000 | 979,078,000 | 1,065,663,000 | ||||||||||
Assumed | 1,653,000 | 2,074,000 | 2,425,000 | ||||||||||
Ceded | -108,255,000 | -38,101,000 | -34,918,000 | ||||||||||
Net premiums earned | 213,589,000 | 209,035,000 | 207,486,000 | 214,261,000 | 226,358,000 | 231,857,000 | 237,777,000 | 247,059,000 | 844,371,000 | 943,051,000 | 1,033,170,000 | ||
Losses incurred [Abstract] | |||||||||||||
Direct | 524,051,000 | 863,871,000 | 2,115,974,000 | ||||||||||
Assumed | 2,012,000 | 2,645,000 | 6,912,000 | ||||||||||
Ceded | -29,986,000 | -27,790,000 | -55,633,000 | ||||||||||
Net losses incurred | $117,074,000 | $115,254,000 | $141,141,000 | $122,608,000 | $196,055,000 | $180,189,000 | $196,274,000 | $266,208,000 | $496,077,000 | $838,726,000 | $2,067,253,000 | ||
[1] | Ceding commissions are reported within Other underwriting and operating expenses, net on the consolidated statements of operations. |
Other_Comprehensive_Income_Det
Other Comprehensive Income (Details) (USD $) | 12 Months Ended | |||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Other comprehensive income (loss) (before tax) [Abstract] | ||||||
Change in unrealized gains and losses on investments | $91,782 | ($126,175) | ($78,546) | |||
Benefit plans adjustments | -52,112 | 68,038 | -1,221 | |||
Unrealized foreign currency translation adjustment | -4,067 | -21,563 | 2,452 | |||
Other comprehensive income (loss) | 35,603 | -79,700 | -77,315 | |||
Other comprehensive income (loss) (tax effects) [Abstract] | ||||||
Change in unrealized gains and losses on investments | -32,017 | 43,732 | 27,510 | |||
Benefit plan adjustments | 18,239 | -23,813 | 428 | |||
Unrealized foreign currency translation adjustment | 1,425 | 7,553 | -859 | |||
Other comprehensive income (loss) | -12,353 | 27,472 | 27,079 | |||
Other comprehensive income (loss) (valuation allowance) [Abstract] | ||||||
Change in unrealized gains and losses on investments | 31,374 | -41,148 | -27,623 | |||
Benefit plan adjustments | -18,239 | 23,813 | -428 | |||
Unrealized foreign currency translation adjustment | 0 | 0 | 0 | |||
Other comprehensive income (loss) | 13,135 | -17,335 | -28,051 | |||
Other comprehensive income (loss) (net of tax) [Abstract] | ||||||
Change in unrealized investment gains and losses on investments | 91,139 | -123,591 | -78,659 | |||
Benefit plan adjustment | -52,112 | 68,038 | -1,221 | |||
Unrealized foreign currency translation adjustment | -2,642 | -14,010 | 1,593 | |||
Other comprehensive income (loss) | 36,385 | -69,563 | -78,287 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance at beginning of period, before tax | -77,216 | 2,484 | 79,799 | |||
Other comprehensive income (loss) before reclassifications | 29,045 | -66,191 | 22,867 | |||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | -6,558 | 13,509 | 100,182 | |||
Other comprehensive income (loss) | 35,603 | -79,700 | -77,315 | |||
Balance at end of period, before tax | -41,613 | -77,216 | 2,484 | |||
Tax effect | -39,728 | [1] | -40,510 | [1] | -50,647 | [1] |
Balance at end of period, net of tax | -81,341 | -117,726 | -48,163 | |||
Tax Effect due to valuation allowance (in hundredths) | 35.00% | -35.00% | -35.00% | |||
Unrealized Gains and Losses on Available-for-Sale Securities [Member] | ||||||
Other comprehensive income (loss) (before tax) [Abstract] | ||||||
Other comprehensive income (loss) | 91,782 | -126,175 | -78,546 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance at beginning of period, before tax | -84,634 | 41,541 | 120,087 | |||
Other comprehensive income (loss) before reclassifications | 78,294 | -112,667 | 22,710 | |||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | -13,488 | [2] | 13,508 | [2] | 101,256 | [2] |
Other comprehensive income (loss) | 91,782 | -126,175 | -78,546 | |||
Balance at end of period, before tax | 7,148 | -84,634 | 41,541 | |||
Tax effect | -64,699 | [1] | -64,056 | [1] | -66,640 | [1] |
Balance at end of period, net of tax | -57,551 | -148,690 | -25,099 | |||
Defined Benefit Plans [Member] | ||||||
Other comprehensive income (loss) (before tax) [Abstract] | ||||||
Other comprehensive income (loss) | -52,112 | 68,038 | -1,222 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance at beginning of period, before tax | -3,766 | -71,804 | -70,582 | |||
Other comprehensive income (loss) before reclassifications | -45,182 | 68,039 | -2,296 | |||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 6,930 | [3] | 1 | [3] | -1,074 | [3] |
Other comprehensive income (loss) | -52,112 | 68,038 | -1,222 | |||
Balance at end of period, before tax | -55,878 | -3,766 | -71,804 | |||
Tax effect | 26,940 | [1] | 26,940 | [1] | 26,940 | [1] |
Balance at end of period, net of tax | -28,938 | 23,174 | -44,864 | |||
Foreign Currency Translation [Member] | ||||||
Other comprehensive income (loss) (before tax) [Abstract] | ||||||
Other comprehensive income (loss) | -4,067 | -21,563 | 2,453 | |||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||
Balance at beginning of period, before tax | 11,184 | 32,747 | 30,294 | |||
Other comprehensive income (loss) before reclassifications | -4,067 | -21,563 | 2,453 | |||
Less: Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | 0 | |||
Other comprehensive income (loss) | -4,067 | -21,563 | 2,453 | |||
Balance at end of period, before tax | 7,117 | 11,184 | 32,747 | |||
Tax effect | -1,969 | [1] | -3,394 | [1] | -10,947 | [1] |
Balance at end of period, net of tax | $5,148 | $7,790 | $21,800 | |||
[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 2014, 2013 and 2012, net unrealized (losses) gains of ($13.5) million, $13.5 million and $101.3 million, respectively, were reclassified to the Consolidated Statement of Operations and included in Realized investment gains. | |||||
[3] | For the years ended December 31, 2014, 2013 and 2012, other comprehensive income (loss) related to benefit plans of $6.9 million, $1 thousand, and ($1.1) million, respectively, was reclassified to the Consolidated Statements of Operations and included in Underwriting and other expenses, net. |
Benefit_Plans_Details
Benefit Plans (Details) (USD $) | 12 Months Ended | ||||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Fund | |||||
Accumulated Other Comprehensive Income [Abstract] | |||||
Minimum percentages of gain loss consider for amortization (in hundredths) | 10.00% | ||||
Increase/(Decrease) in AOCI [Abstract] | |||||
Other adjustments | $52,112,000 | ($68,038,000) | $1,221,000 | ||
Information used in actuarial assumptions [Abstract] | |||||
Minimum value of outstanding noncallable bonds used in hypothetical cash flow bond matching exercise | 50,000,000 | ||||
Future earnings period used in determining the expected average rate of earnings | 20 years | ||||
Target Allocation of Assets [Abstract] | |||||
Minimum percentage return should exceed growth in consumer price index annually (in hundredths) | 5.75% | ||||
Maximum investment in international oriented funds (in hundredths) | 30.00% | ||||
Number of international mutual funds | 2 | ||||
Percent of international oriented funds equity allocation in emerging markets (in hundredths) | 4.00% | ||||
Percent of international oriented funds equity allocation in companies based outside of the United States, primarily Europe and the Pacific Basin (in hundredths) | 21.00% | ||||
Effect of 1% change in the health care trend rate assumption [Abstract] | |||||
Effect of 1-percentage point increase on total service and interest cost component | 259,000 | ||||
Effect of 1-percentage point increase on postretirement benefit obligation | 2,963,000 | ||||
Effect of 1-percentage point decrease on total service and interest cost components | -201,000 | ||||
Effect of 1-percentage point decrease on postretirement benefit obligation | -2,466,000 | ||||
Profit sharing and 401(k) savings plan [Abstract] | |||||
Discretionary profit sharing contribution as a percentage of participant's eligible compensation (in hundredths) | 5.00% | ||||
Matching contribution rate on employees' before-tax contributions, first contribution level (in hundredths) | 80.00% | ||||
Employee contributions subject to employer match, first contribution level | 1,000 | ||||
Matching contribution rate on employees' before-tax contributions, second contribution level (in hundredths) | 40.00% | ||||
Employee contributions subject to employer match, second contribution level | 2,000 | ||||
Profit sharing and 401(k) savings plan expenses | 5,000,000 | 5,300,000 | 3,100,000 | ||
Employee contributions subject to employer match for employees hired after 01/01/2014 (in hundredths) | 4.00% | ||||
Matching contribution rate on employees' before-tax contributions, hired after 01/01/2014 (in hundredths) | 100.00% | ||||
Pension and Supplemental Executive Retirement Plans [Member] | |||||
Components of Net Periodic Benefit Cost [Abstract] | |||||
Company Service Cost | 8,565,000 | 11,338,000 | 9,662,000 | ||
Interest Cost | 15,987,000 | 15,289,000 | 16,481,000 | ||
Expected Return on Assets | -21,030,000 | -20,144,000 | -18,211,000 | ||
Other Adjustments | 0 | 0 | 0 | ||
Subtotal | 3,522,000 | 6,483,000 | 7,932,000 | ||
Amortization of Net Transition Obligation/(Asset) | 0 | 0 | 0 | ||
Amortization of Net Prior Service Cost/(Credit) | -930,000 | 503,000 | 665,000 | ||
Amortization of Net Losses/(Gains) | 1,083,000 | 6,145,000 | 5,829,000 | ||
Total Amortization | 153,000 | 6,648,000 | 6,494,000 | ||
Net Periodic Benefit Cost | 3,675,000 | 13,131,000 | 14,426,000 | ||
Cost of settlements or curtailments | 302,000 | 0 | 0 | ||
Total Expense for Year | 3,977,000 | 13,131,000 | 14,426,000 | ||
Actuarial Value of Benefit Obligations [Abstract] | |||||
Measurement Date | 12/31/14 | 12/31/13 | |||
Accumulated Benefit Obligation | 366,440,000 | 304,825,000 | |||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Projected Benefit Obligation | -379,324,000 | -317,606,000 | -362,657,000 | ||
Plan Assets at Fair Value | 378,701,000 | 355,704,000 | 340,335,000 | ||
Funded Status - Overfunded/(Underfunded) | -623,000 | 38,098,000 | |||
Accumulated Other Comprehensive Income [Abstract] | |||||
Net Actuarial (Gain)/Loss | 93,243,000 | 49,925,000 | |||
Net Prior Service Cost/(Credit) | -3,853,000 | -4,782,000 | |||
Net Transition Obligation/(Asset) | 0 | 0 | |||
Total at Year End | 89,390,000 | 45,143,000 | 108,436,000 | ||
Change in Projected Benefit Obligation [Roll Forward] | |||||
Benefit Obligation at Beginning of Year | 317,606,000 | 362,657,000 | |||
Company Service Cost | 8,565,000 | 11,338,000 | 9,662,000 | ||
Interest Cost | 15,987,000 | 15,289,000 | 16,481,000 | ||
Plan Participants' Contributions | 0 | 0 | |||
Net Actuarial (Gain)/Loss due to Assumption Changes | 59,901,000 | -44,205,000 | |||
Net Actuarial (Gain)/Loss due to Plan Experience | -55,000 | 1,353,000 | |||
Benefit Payments from Fund | -21,539,000 | [1] | -22,497,000 | [1] | |
Benefit Payments Directly by Company | -1,404,000 | -275,000 | |||
Plan Amendments | -1,000 | -6,054,000 | |||
Other Adjustment | 264,000 | 0 | |||
Benefit Obligation at End of Year | 379,324,000 | 317,606,000 | 362,657,000 | ||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at Beginning of Year | 355,704,000 | 340,335,000 | |||
Company Contributions | 9,504,000 | 10,275,000 | |||
Plan Participants' Contributions | 0 | 0 | |||
Benefit Payments from Fund | -21,539,000 | [1] | -22,497,000 | [1] | |
Benefit Payments Directly by Company | -1,404,000 | -275,000 | |||
Actual Return on Assets | 36,436,000 | 27,866,000 | |||
Other Adjustment | 0 | 0 | |||
Fair Value of Plan Assets at End of Year | 378,701,000 | 355,704,000 | 340,335,000 | ||
Change in Accumulated Other Comprehensive Income (AOCI) [Abstract] | |||||
AOCI in Prior Year | 45,143,000 | 108,436,000 | |||
Increase/(Decrease) in AOCI [Abstract] | |||||
Recognized during year - Prior Service (Cost)/Credit | 930,000 | -503,000 | |||
Recognized during year - Net Actuarial (Losses)/Gains | -1,083,000 | -6,145,000 | |||
Occurring during year - Prior Service Cost | -1,000 | -6,054,000 | |||
Occurring during year - Net Actuarial Losses/(Gains) | 44,703,000 | -50,574,000 | |||
Occurring during year - Net Settlement Losses/(Gains) | -302,000 | 0 | |||
Other adjustments | 0 | -17,000 | |||
AOCI in Current Year | 89,390,000 | 45,143,000 | 108,436,000 | ||
Amortizations Expected to be Recognized During Next Fiscal Year Ending [Abstract] | |||||
Amortization of Net Transition Obligation/(Asset) | 0 | ||||
Amortization of Prior Service Cost/(Credit) | -846,000 | ||||
Amortization of Net Losses/(Gains) | 4,837,000 | ||||
Weighted-Average Assumptions Used to Determine Benefit Obligations at year end [Abstract] | |||||
Discount Rate (in hundredths) | 4.25% | 5.15% | |||
Rate of Compensation Increase (in hundredths) | 3.00% | 3.00% | |||
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost for Year [Abstract] | |||||
Discount Rate (in hundredths) | 5.15% | 4.25% | |||
Expected Long-term Return on Plan Assets (in hundredths) | 6.00% | 6.00% | |||
Rate of Compensation Increase (in hundredths) | 3.00% | 3.00% | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 378,701,000 | 355,704,000 | 340,335,000 | ||
Company Contributions [Abstract] | |||||
Current | 9,504,000 | 10,275,000 | |||
Current + 1 | 17,000,000 | ||||
Actual Benefit Payments [Abstract] | |||||
Current | 22,942,000 | ||||
Expected Benefit Payments [Abstract] | |||||
Current + 1 | 22,966,000 | ||||
Current + 2 | 23,159,000 | ||||
Current + 3 | 24,356,000 | ||||
Current + 4 | 25,683,000 | ||||
Current + 5 | 27,217,000 | ||||
Current + 6 - 10 | 135,585,000 | ||||
Other Postretirement Benefits [Member] | |||||
Components of Net Periodic Benefit Cost [Abstract] | |||||
Company Service Cost | 659,000 | 812,000 | 1,226,000 | ||
Interest Cost | 653,000 | 618,000 | 1,144,000 | ||
Expected Return on Assets | -4,648,000 | -3,679,000 | -3,162,000 | ||
Other Adjustments | 0 | 0 | 0 | ||
Subtotal | -3,336,000 | -2,249,000 | -792,000 | ||
Amortization of Net Transition Obligation/(Asset) | 0 | 0 | 0 | ||
Amortization of Net Prior Service Cost/(Credit) | -6,649,000 | -6,649,000 | -6,217,000 | ||
Amortization of Net Losses/(Gains) | -435,000 | 0 | 797,000 | ||
Total Amortization | -7,084,000 | -6,649,000 | -5,420,000 | ||
Net Periodic Benefit Cost | -10,420,000 | -8,898,000 | -6,212,000 | ||
Cost of settlements or curtailments | 0 | 0 | 0 | ||
Total Expense for Year | -10,420,000 | -8,898,000 | -6,212,000 | ||
Actuarial Value of Benefit Obligations [Abstract] | |||||
Measurement Date | 12/31/14 | 12/31/13 | |||
Accumulated Benefit Obligation | 18,225,000 | 15,764,000 | |||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Projected Benefit Obligation | -18,225,000 | -15,764,000 | -16,284,000 | ||
Plan Assets at Fair Value | 66,940,000 | 62,298,000 | 49,391,000 | ||
Funded Status - Overfunded/(Underfunded) | 48,715,000 | 46,534,000 | |||
Accumulated Other Comprehensive Income [Abstract] | |||||
Net Actuarial (Gain)/Loss | -8,222,000 | -9,439,000 | |||
Net Prior Service Cost/(Credit) | -25,289,000 | -31,938,000 | |||
Net Transition Obligation/(Asset) | 0 | 0 | |||
Total at Year End | -33,511,000 | -41,377,000 | -36,602,000 | ||
Change in Projected Benefit Obligation [Roll Forward] | |||||
Benefit Obligation at Beginning of Year | 15,764,000 | 16,284,000 | |||
Company Service Cost | 659,000 | 812,000 | 1,226,000 | ||
Interest Cost | 653,000 | 618,000 | 1,144,000 | ||
Plan Participants' Contributions | 336,000 | 299,000 | |||
Net Actuarial (Gain)/Loss due to Assumption Changes | 2,276,000 | -1,414,000 | |||
Net Actuarial (Gain)/Loss due to Plan Experience | -855,000 | 101,000 | |||
Benefit Payments from Fund | -645,000 | [1] | -871,000 | [1] | |
Benefit Payments Directly by Company | 0 | -65,000 | |||
Plan Amendments | 0 | 0 | |||
Other Adjustment | 37,000 | 0 | |||
Benefit Obligation at End of Year | 18,225,000 | 15,764,000 | 16,284,000 | ||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at Beginning of Year | 62,298,000 | 49,391,000 | |||
Company Contributions | 0 | 0 | |||
Plan Participants' Contributions | 336,000 | 299,000 | |||
Benefit Payments from Fund | -645,000 | [1] | -871,000 | [1] | |
Benefit Payments Directly by Company | 0 | -65,000 | |||
Actual Return on Assets | 5,250,000 | 13,778,000 | |||
Other Adjustment | -299,000 | -234,000 | |||
Fair Value of Plan Assets at End of Year | 66,940,000 | 62,298,000 | 49,391,000 | ||
Change in Accumulated Other Comprehensive Income (AOCI) [Abstract] | |||||
AOCI in Prior Year | -41,377,000 | -36,602,000 | |||
Increase/(Decrease) in AOCI [Abstract] | |||||
Recognized during year - Prior Service (Cost)/Credit | 6,649,000 | 6,649,000 | |||
Recognized during year - Net Actuarial (Losses)/Gains | 435,000 | 0 | |||
Occurring during year - Prior Service Cost | 0 | 0 | |||
Occurring during year - Net Actuarial Losses/(Gains) | 782,000 | -11,411,000 | |||
Occurring during year - Net Settlement Losses/(Gains) | 0 | 0 | |||
Other adjustments | 0 | -13,000 | |||
AOCI in Current Year | -33,511,000 | -41,377,000 | -36,602,000 | ||
Amortizations Expected to be Recognized During Next Fiscal Year Ending [Abstract] | |||||
Amortization of Net Transition Obligation/(Asset) | 0 | ||||
Amortization of Prior Service Cost/(Credit) | -6,649,000 | ||||
Amortization of Net Losses/(Gains) | -142,000 | ||||
Weighted-Average Assumptions Used to Determine Benefit Obligations at year end [Abstract] | |||||
Discount Rate (in hundredths) | 4.00% | 4.75% | |||
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost for Year [Abstract] | |||||
Discount Rate (in hundredths) | 4.75% | 3.85% | |||
Expected Long-term Return on Plan Assets (in hundredths) | 7.50% | 7.50% | |||
Assumed Health Care Cost Trend Rates at year end [Abstract] | |||||
Health Care Cost Trend Rate Assumed for Next Year (in hundredths) | 7.00% | 7.00% | |||
Rate to Which the Cost Trend Rate is Assumed to Decline (Ultimate Trend Rate) (in hundredths) | 5.00% | 5.00% | |||
Year That the Rate Reaches the Ultimate Trend Rate | 2019 | 2018 | |||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 100.00% | 100.00% | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 66,940,000 | 62,298,000 | 49,391,000 | ||
Company Contributions [Abstract] | |||||
Current | 0 | 0 | |||
Current + 1 | 0 | ||||
Actual Benefit Payments [Abstract] | |||||
Current | 272,000 | ||||
Expected Benefit Payments [Abstract] | |||||
Current + 1 | 781,000 | ||||
Current + 2 | 837,000 | ||||
Current + 3 | 912,000 | ||||
Current + 4 | 1,136,000 | ||||
Current + 5 | 1,238,000 | ||||
Current + 6 - 10 | 8,138,000 | ||||
Health care trend rate used for pre-65 benefits (in hundredths) | 7.00% | ||||
Age of retirees at which retirement benefits under the plan are terminated | 65 years | ||||
Health care trend rate used for pre-65 benefits in 2015 (in hundredths) | 7.00% | ||||
Health care trend rate used for pre-65 benefits in 2019 (in hundredths) | 5.00% | ||||
Other Postretirement Benefits [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 50,710,000 | 45,585,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 50,710,000 | 45,585,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 50,710,000 | 45,585,000 | |||
Other Postretirement Benefits [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 16,230,000 | 16,713,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 16,230,000 | 16,713,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 16,230,000 | 16,713,000 | |||
Other Postretirement Benefits [Member] | Debt Securities [Member] | |||||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 0.00% | 0.00% | |||
Other Postretirement Benefits [Member] | Equity Securities [Member] | |||||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 100.00% | 100.00% | |||
Target Allocation of Assets [Abstract] | |||||
Target asset allocations, minimum (in hundredths) | 70.00% | ||||
Target asset allocations, maximum (in hundredths) | 100.00% | ||||
Other Postretirement Benefits [Member] | Fixed Income [Member] | |||||
Target Allocation of Assets [Abstract] | |||||
Target asset allocations, minimum (in hundredths) | 0.00% | ||||
Target asset allocations, maximum (in hundredths) | 10.00% | ||||
Other Postretirement Benefits [Member] | Other [Member] | |||||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 0.00% | 0.00% | |||
Other Postretirement Benefits [Member] | Real Estate [Member] | |||||
Target Allocation of Assets [Abstract] | |||||
Target asset allocations, minimum (in hundredths) | 0.00% | ||||
Target asset allocations, maximum (in hundredths) | 15.00% | ||||
Other Postretirement Benefits [Member] | Commodities [Member] | |||||
Target Allocation of Assets [Abstract] | |||||
Target asset allocations, minimum (in hundredths) | 0.00% | ||||
Target asset allocations, maximum (in hundredths) | 10.00% | ||||
Other Postretirement Benefits [Member] | Level 1 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 66,940,000 | 62,298,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 66,940,000 | 62,298,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 66,940,000 | 62,298,000 | |||
Other Postretirement Benefits [Member] | Level 1 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 50,710,000 | 45,585,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 50,710,000 | 45,585,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 50,710,000 | 45,585,000 | |||
Other Postretirement Benefits [Member] | Level 1 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 16,230,000 | 16,713,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 16,230,000 | 16,713,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 16,230,000 | 16,713,000 | |||
Other Postretirement Benefits [Member] | Level 2 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Other Postretirement Benefits [Member] | Level 2 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Other Postretirement Benefits [Member] | Level 2 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Other Postretirement Benefits [Member] | Level 3 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Other Postretirement Benefits [Member] | Level 3 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Other Postretirement Benefits [Member] | Level 3 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 378,701,000 | 355,704,000 | |||
Change in Projected Benefit Obligation [Roll Forward] | |||||
Lump sum pension plan benefit payments | 11,800,000 | 13,800,000 | |||
Maximum amount of eligible participant vested benefits for which lump sum payment can be elected | 200,000 | ||||
Total increase in benefit obligation using new mortality tables | 23,200,000 | ||||
Percentage of participants electing lump sum payments (in hundredths) | 75.00% | ||||
Increase in benefit obligation using new mortality tables and lump sum election assumption | 14,600,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at Beginning of Year | 355,704,000 | ||||
Fair Value of Plan Assets at End of Year | 378,701,000 | 355,704,000 | |||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 100.00% | 100.00% | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 378,701,000 | 355,704,000 | |||
Pension Plan [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 9,913,000 | 51,240,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 9,913,000 | 51,240,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 9,913,000 | 51,240,000 | |||
Pension Plan [Member] | Common Stock [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 60,332,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 60,332,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 60,332,000 | ||||
Pension Plan [Member] | Corporate Bond [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 200,732,000 | 134,012,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 200,732,000 | 134,012,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 200,732,000 | 134,012,000 | |||
Pension Plan [Member] | U.S. Government Securities [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 6,561,000 | 18,819,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 6,561,000 | 18,819,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 6,561,000 | 18,819,000 | |||
Pension Plan [Member] | Municipals [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 65,214,000 | 33,402,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 65,214,000 | 33,402,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 65,214,000 | 33,402,000 | |||
Pension Plan [Member] | Foreign Bonds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 23,028,000 | 15,961,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 23,028,000 | 15,961,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 23,028,000 | 15,961,000 | |||
Pension Plan [Member] | Foreign Stocks [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 2,124,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 2,124,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 2,124,000 | ||||
Pension Plan [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 39,814,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 39,814,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 39,814,000 | ||||
Pension Plan [Member] | Debt Securities [Member] | |||||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 78.00% | 57.00% | |||
Pension Plan [Member] | Equity Securities [Member] | |||||
Allocation of assets at year end [Abstract] | |||||
Weighted-average asset allocations of plans (in hundredths) | 22.00% | 43.00% | |||
Target Allocation of Assets [Abstract] | |||||
Target asset allocations, maximum (in hundredths) | 40.00% | ||||
Pension Plan [Member] | ETF's [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 5,636,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 5,636,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 5,636,000 | ||||
Pension Plan [Member] | Pooled Equity Accounts [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 67,617,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 67,617,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 67,617,000 | ||||
Pension Plan [Member] | Level 1 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 20,876,000 | 163,084,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 20,876,000 | 163,084,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 20,876,000 | 163,084,000 | |||
Pension Plan [Member] | Level 1 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 9,913,000 | 51,240,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 9,913,000 | 51,240,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 9,913,000 | 51,240,000 | |||
Pension Plan [Member] | Level 1 [Member] | Common Stock [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 60,332,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 60,332,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 60,332,000 | ||||
Pension Plan [Member] | Level 1 [Member] | Corporate Bond [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 1 [Member] | U.S. Government Securities [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 5,327,000 | 9,574,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 5,327,000 | 9,574,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 5,327,000 | 9,574,000 | |||
Pension Plan [Member] | Level 1 [Member] | Municipals [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 1 [Member] | Foreign Bonds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 1 [Member] | Foreign Stocks [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 2,124,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 2,124,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 2,124,000 | ||||
Pension Plan [Member] | Level 1 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 39,814,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 39,814,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 39,814,000 | ||||
Pension Plan [Member] | Level 1 [Member] | ETF's [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 5,636,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 5,636,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 5,636,000 | ||||
Pension Plan [Member] | Level 1 [Member] | Pooled Equity Accounts [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 2 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 357,825,000 | 192,620,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 357,825,000 | 192,620,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 357,825,000 | 192,620,000 | |||
Pension Plan [Member] | Level 2 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 2 [Member] | Common Stock [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 2 [Member] | Corporate Bond [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 200,732,000 | 134,012,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 200,732,000 | 134,012,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 200,732,000 | 134,012,000 | |||
Pension Plan [Member] | Level 2 [Member] | U.S. Government Securities [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 1,234,000 | 9,245,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 1,234,000 | 9,245,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 1,234,000 | 9,245,000 | |||
Pension Plan [Member] | Level 2 [Member] | Municipals [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 65,214,000 | 33,402,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 65,214,000 | 33,402,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 65,214,000 | 33,402,000 | |||
Pension Plan [Member] | Level 2 [Member] | Foreign Bonds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 23,028,000 | 15,961,000 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 23,028,000 | 15,961,000 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 23,028,000 | 15,961,000 | |||
Pension Plan [Member] | Level 2 [Member] | Foreign Stocks [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 2 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 2 [Member] | ETF's [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 2 [Member] | Pooled Equity Accounts [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 67,617,000 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 67,617,000 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 67,617,000 | ||||
Pension Plan [Member] | Level 3 [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | Domestic Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | Common Stock [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 3 [Member] | Corporate Bond [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | U.S. Government Securities [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | Municipals [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | Foreign Bonds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | 0 | |||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | 0 | |||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | 0 | |||
Pension Plan [Member] | Level 3 [Member] | Foreign Stocks [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 3 [Member] | International Mutual Funds [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 3 [Member] | ETF's [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | 0 | ||||
Pension Plan [Member] | Level 3 [Member] | Pooled Equity Accounts [Member] | |||||
Funded Status/Asset (Liability) on the Consolidated Balance Sheet [Abstract] | |||||
Plan Assets at Fair Value | 0 | ||||
Change in Plan Assets [Roll Forward] | |||||
Fair Value of Plan Assets at End of Year | 0 | ||||
Assets at Fair Value [Abstract] | |||||
Total Assets at fair value | $0 | ||||
[1] | In 2014, includes lump sum payments of $11.8 million from our pension plan to eligible participants, which were former employees with vested benefits. In 2013, includes lump sum payments of $13.8 million from our pension plan to eligible participants, which were former employees with vested benefits of $200 thousand or less. |
Income_Taxes_Details
Income Taxes (Details) (USD $) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2007 | |
Net deferred tax assets and liabilities [Abstract] | ||||||||||||
Total deferred tax assets | $933,576,000 | $1,043,477,000 | $933,576,000 | $1,043,477,000 | ||||||||
Total deferred tax liabilities | -33,789,000 | -42,158,000 | -33,789,000 | -42,158,000 | ||||||||
Net deferred tax asset before valuation allowance | 899,787,000 | 1,001,319,000 | 899,787,000 | 1,001,319,000 | ||||||||
Valuation allowance | -902,289,000 | -1,004,256,000 | -902,289,000 | -1,004,256,000 | 966,000,000 | |||||||
Net deferred tax liability | -2,502,000 | -2,937,000 | -2,502,000 | -2,937,000 | ||||||||
Components of net deferred tax liability [Abstract] | ||||||||||||
Unearned premium reserves | 12,296,000 | -1,073,000 | 12,296,000 | -1,073,000 | ||||||||
Benefit plans | -13,900,000 | -26,111,000 | -13,900,000 | -26,111,000 | ||||||||
Net operating loss | 845,616,000 | 915,378,000 | 845,616,000 | 915,378,000 | ||||||||
Loss reserves | 23,069,000 | 36,236,000 | 23,069,000 | 36,236,000 | ||||||||
Unrealized (appreciation) depreciation in investments | -2,800,000 | 29,230,000 | -2,800,000 | 29,230,000 | ||||||||
Mortgage investments | 15,346,000 | 13,450,000 | 15,346,000 | 13,450,000 | ||||||||
Deferred compensation | 11,955,000 | 15,994,000 | 11,955,000 | 15,994,000 | ||||||||
Premium deficiency reserves | 8,313,000 | 16,961,000 | 8,313,000 | 16,961,000 | ||||||||
Other, net | -108,000 | 1,254,000 | -108,000 | 1,254,000 | ||||||||
Net deferred tax asset before valuation allowance | 899,787,000 | 1,001,319,000 | 899,787,000 | 1,001,319,000 | ||||||||
Valuation allowance | -902,289,000 | -1,004,256,000 | -902,289,000 | -1,004,256,000 | 966,000,000 | |||||||
Net deferred tax liability | -2,502,000 | -2,937,000 | -2,502,000 | -2,937,000 | ||||||||
Tax provision (benefit) [Abstract] | ||||||||||||
Provision for (benefit from) income taxes before valuation allowance | 91,607,000 | -17,239,000 | -330,740,000 | |||||||||
Change in valuation allowance | -88,833,000 | 20,935,000 | 329,175,000 | |||||||||
Provision for (benefit from) income taxes (note 14) | 681,000 | 249,000 | 1,118,000 | 726,000 | 1,231,000 | 336,000 | 990,000 | 1,139,000 | 2,774,000 | 3,696,000 | -1,565,000 | |
Change in deferred tax valuation allowance, included in other comprehensive income | -13,100,000 | 17,300,000 | 28,100,000 | |||||||||
Net operating loss carryforwards, regular tax basis | 2,417,000,000 | 2,417,000,000 | ||||||||||
Net operating loss carryforwards for computing the alternative minimum tax | 1,529,000,000 | 1,529,000,000 | ||||||||||
Components of provisions for (benefit from) income taxes [Abstract] | ||||||||||||
Current | 2,391,000 | 916,000 | -4,251,000 | |||||||||
Deferred | 1,000 | 7,000 | 90,000 | |||||||||
Other | 382,000 | 2,773,000 | 2,596,000 | |||||||||
Provision for (benefit from) income taxes (note 14) | 681,000 | 249,000 | 1,118,000 | 726,000 | 1,231,000 | 336,000 | 990,000 | 1,139,000 | 2,774,000 | 3,696,000 | -1,565,000 | |
Federal income tax received | -7,000,000 | |||||||||||
Federal income tax paid | 1,300,000 | 100,000 | ||||||||||
Reconciliation of effective income tax rate [Abstract] | ||||||||||||
Federal statutory income tax rate (in hundredths) | 35.00% | -35.00% | -35.00% | |||||||||
Valuation allowance (in hundredths) | -34.90% | 45.40% | 35.40% | |||||||||
Tax exempt municipal bond interest (in hundredths) | -0.40% | -3.70% | -0.80% | |||||||||
Other, net (in hundredths) | 1.40% | 1.30% | 0.20% | |||||||||
Effective income tax rate (in hundredths) | 1.10% | 8.00% | -0.20% | |||||||||
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 | 168,400,000 | 168,400,000 | ||||||||||
Estimate of additional state income taxes and interest that may be due | 47,400,000 | 47,400,000 | ||||||||||
Amount of payment made related to the IRS assessment on the REMIC issue | 65,200,000 | |||||||||||
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 | ||||||||||
Unrecognized tax benefits [Roll Forward] | ||||||||||||
Balance at beginning of year | 105,366,000 | 104,550,000 | 105,366,000 | 104,550,000 | 110,080,000 | |||||||
Additions based on tax positions related to the current year | 0 | 0 | 0 | |||||||||
Additions for tax positions of prior years | 864,000 | 816,000 | 511,000 | |||||||||
Reductions for tax positions of prior years | 0 | 0 | -4,041,000 | |||||||||
Settlements | 0 | 0 | -2,000,000 | |||||||||
Balance at end of year | 106,230,000 | 105,366,000 | 106,230,000 | 105,366,000 | 104,550,000 | |||||||
Unrecognized tax benefits [Abstract] | ||||||||||||
Total amount of unrecognized tax benefits that would affect effective tax rate | 93,600,000 | 93,600,000 | ||||||||||
Unrecognized tax benefits, interest expense | 800,000 | |||||||||||
Unrecognized tax benefits, accrued interest | 26,900,000 | 26,100,000 | 26,900,000 | 26,100,000 | ||||||||
Approximate net cash outflows upon resolution of IRS matters | 25,000,000 | 25,000,000 | ||||||||||
Significant change in unrecognized tax benefits | $106,200,000 | $106,200,000 |
Shareholders_Equity_Details
Shareholders' Equity (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||||
Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Jun. 30, 2013 | Apr. 30, 2012 | |
Right | ||||||
Shareholders' Equity [Abstract] | ||||||
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 | 680,000,000 | 460,000,000 | ||
Debt Instrument [Line Items] | ||||||
Stated interest rate (in hundredths) | 2.00% | |||||
Shareholder Rights Agreement [Abstract] | ||||||
Shareholder rights accompanying each outstanding share of the company's common stock (in number of Rights) | 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% | |||||
Common shares purchasable per Right (in shares) | 0.1 | |||||
Purchase price (in dollars per share) | $14 | |||||
Purchase price (in dollars per one-tenth share) | $1.40 | |||||
Redemption price (in dollars per Right) | $0.00 | |||||
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 | $0 | ||
Mortgage Guaranty Insurance Corporation [Member] | ||||||
Subsidiary or Equity Method Investee [Line Items] | ||||||
Surplus contributions made to subsidiary by the parent company | 800,000,000 | 0 | 800,000,000 | 100,000,000 | ||
Convertible Debentures [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding principal amount | 389,500,000 | 389,500,000 | ||||
Stated interest rate (in hundredths) | 9.00% | 9.00% | ||||
Shares reserved for conversion under convertible debt (in shares) | 28,900,000 | |||||
Convertible Senior Notes [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding principal amount | 345,000,000 | 345,000,000 | ||||
Stated interest rate (in hundredths) | 5.00% | 5.00% | ||||
Shares reserved for conversion under convertible debt (in shares) | 97,600,000 | |||||
Convertible Senior Notes - Due April 2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Outstanding principal amount | $500,000,000 | $500,000,000 | $500,000,000 | |||
Stated interest rate (in hundredths) | 2.00% | 2.00% | 2.00% |
Dividend_Restrictions_Details
Dividend Restrictions (Details) | 12 Months Ended |
Dec. 31, 2014 | |
Dividend Restrictions [Abstract] | |
Dividend restrictions | The maximum amount of dividends that the insurance subsidiaries may pay in any twelve-month period without regulatory approval by the Office of the Commissioner of Insurance of the State of Wisconsin (the bOCIb) is the lesser of adjusted statutory net income or 10% of statutory policyholders' surplus as of the preceding calendar year end. |
Percentage of statutory policyholders' surplus used to determine maximum allowable dividends (in hundredths) | 10.00% |
Statutory_Capital_Details
Statutory Capital (Details) (USD $) | 1 Months Ended | 12 Months Ended | ||
Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Statutory Capital [Abstract] | ||||
Percentage of premiums earned required to be maintained as contingency loss reserves (in hundredths) | 50.00% | |||
Period that contingency loss reserves must be held (in years) | 10 years | |||
Percentage of net premiums earned that incurred losses must exceed to enable early withdrawals from contingency loss reserves (in hundredths) | 35.00% | |||
Percentage of surplus as regards policyholders (in hundredths) | 10.00% | |||
Statutory deferred tax assets admitted | $138,000,000 | $138,000,000 | $63,000,000 | |
Net (loss) income | 13,203,000 | -8,046,000 | -902,878,000 | |
Surplus | 1,585,164,000 | 1,584,121,000 | 748,592,000 | |
Contingency Reserve | 318,247,000 | 18,558,000 | 6,430,000 | |
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 | 16.4 to 1 | |||
Number of jurisdictions with risk-to-capital requirements | 16 | |||
Mortgage Guaranty Insurance Corporation [Member] | ||||
Related Party Transaction [Line Items] | ||||
Surplus contributions made to subsidiary by the parent company | 800,000,000 | 0 | 800,000,000 | 100,000,000 |
Dividends paid by MGIC to the parent company | 0 | 0 | 0 | |
Statutory capital requirements [Abstract] | ||||
Risk to capital ratio at end of period | 14.6 to 1 | |||
Amount of policyholders position above or below required MPP | 673,000,000 | |||
Amount of required MPP | 1,000,000,000 | |||
Other Insurance Subsidiaries [Member] | ||||
Related Party Transaction [Line Items] | ||||
Surplus contributions made to subsidiary by the parent company | $0 | $0 | $0 |
Sharebased_Compensation_Plans_1
Share-based Compensation Plans (Details) (USD $) | 12 Months Ended | |||
In Millions, except Share data, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Compensation cost | $9.20 | $6.60 | $8.60 | |
Income tax benefit from compensation cost | 3.2 | 2.3 | 3 | |
Shares subject to option [Roll Forward] | ||||
Granted (in shares) | 0 | 0 | 0 | |
Exercised (in shares) | 0 | 0 | 0 | |
Shares [Roll Forward] | ||||
Restricted stock outstanding at end of period (in shares) | 3,900,000 | |||
Stock Options [Member] | ||||
Shares subject to option [Roll Forward] | ||||
Options exercisable (in shares) | 529,800 | |||
Options exercisable, weighted average exercise price (in dollars per share) | $68.20 | |||
Restricted Stock/Restricted Stock Units [Member] | ||||
Weighted average grant date fair market value [Abstract] | ||||
Restricted stock outstanding at end of period (in dollars per share) | $5.15 | |||
Granted (in dollars per share) | $8.43 | $2.75 | $3.97 | |
Vested (in dollars per share) | $5.66 | |||
Forfeited (in dollars per share) | $8.44 | |||
Restricted stock outstanding at end of period (in dollars per share) | $6.33 | $5.15 | ||
Shares [Roll Forward] | ||||
Restricted stock outstanding at beginning of period (in shares) | 3,622,707 | |||
Granted (in shares) | 1,804,800 | |||
Vested (in shares) | -1,368,234 | |||
Forfeited (in shares) | -206,882 | |||
Restricted stock outstanding at end of period (in shares) | 3,852,391 | 3,622,707 | ||
Additional disclosures [Abstract] | ||||
Restricted stock, performance shares (in shares) | 2,900,000 | |||
Restricted stock, time vested shares (in shares) | 1,000,000 | |||
Total fair value of restricted stock vested | 12.1 | 4.3 | 6.9 | |
Unrecognized compensation cost | 12.8 | |||
Unrecognized compensation cost, performance shares | 9.9 | |||
Unrecognized compensation cost, time vested shares | 2.9 | |||
Weighted-average period for recognition of compensation cost | 1 year 8 months 12 days | |||
Minimum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 1 year | |||
Maximum [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Award vesting period | 3 years | |||
2002 Plan [Member] | Restricted Stock Units (RSUs) [Member] | Cash Settled Award [Member] | ||||
Shares [Roll Forward] | ||||
Restricted stock outstanding at beginning of period (in shares) | 144,146 | 294,782 | 443,950 | |
Granted (in shares) | 0 | 0 | 0 | 449,350 |
Vested (in shares) | -144,146 | -147,368 | -147,968 | |
Forfeited (in shares) | 0 | -3,268 | -1,200 | |
Restricted stock outstanding at end of period (in shares) | 0 | 144,146 | 294,782 | 443,950 |
Cash payments for vested shares | $1.20 | $0.40 | $0.60 | |
2011 Plan [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum number of shares can be awarded under the plan (in shares) | 7,000,000 | |||
Additional disclosures [Abstract] | ||||
Shares available for future grants (in shares) | 2,300,000 |
Leases_Details
Leases (Details) (USD $) | 12 Months Ended | ||
Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Leases [Abstract] | |||
Remaining term of operating leases (in years) | 7 years | ||
Total rental expense under operating leases | $2,800,000 | $4,600,000 | $4,800,000 |
Minimum future operating lease payments [Abstract] | |||
2015 | 1,041,000 | ||
2016 | 1,000,000 | ||
2017 | 467,000 | ||
2018 | 231,000 | ||
2019 and thereafter | 497,000 | ||
Total | $3,236,000 |
Litigation_and_Contingencies_D
Litigation and Contingencies (Details) (USD $) | 6 Months Ended | 12 Months Ended | 36 Months Ended | |||||
Jun. 30, 2009 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | Dec. 31, 2010 | Dec. 31, 2009 | Dec. 31, 2011 | |
Class action complaint under RESPA [Abstract] | ||||||||
Civil penalty | $2,650,000 | |||||||
Period of existing captive reinsurance agreement | 10 years | 10 years | ||||||
Curtailments [Abstract] | ||||||||
Average paid claim reduction due to curtailments (in hundredths) | 6.70% | 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 | 97,000,000 | 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% | |||||||
Statute of limitations to bring legal proceedings disputing right to rescind coverage | 3 years | |||||||
Statute of limitations to bring legal proceedings after notice of rescission | 2 years | |||||||
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 | |||||||
Maximum exposure above estimate provision for claims paying practices | 626,000,000 | |||||||
Exposure from rescission practices (in hundredths) | 60.00% | |||||||
Maximum exposure associated with other discussions and legal proceedings | 16,000,000 | |||||||
Other Legal Proceedings [Abstract] | ||||||||
Underwriting remedy expense | 4,000,000 | 5,000,000 | 27,000,000 | |||||
Class Action Complaint Under RESPA [Member] | Pending Litigation [Member] | ||||||||
Class action complaint under RESPA [Abstract] | ||||||||
Number of lawsuits | 12 | |||||||
Number of cases dismissed prior to February 2015 | 7 | |||||||
Number of cases dismissed or expected to be dismissed | 5 | |||||||
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 |
Unaudited_Quarterly_Financial_2
Unaudited Quarterly Financial Data (Details) (USD $) | 3 Months Ended | 12 Months Ended | |||||||||||||||||
In Thousands, except Per Share data, unless otherwise specified | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | ||||||||
Unaudited Quarterly Financial Data [Abstract] | |||||||||||||||||||
Net premiums earned | $213,589 | $209,035 | $207,486 | $214,261 | $226,358 | $231,857 | $237,777 | $247,059 | $844,371 | $943,051 | $1,033,170 | ||||||||
Investment income, net of expenses | 23,956 | 22,355 | 21,180 | 20,156 | 21,278 | 20,250 | 20,883 | 18,328 | 87,647 | 80,739 | 121,640 | ||||||||
Realized (losses) gains | 434 | 632 | 522 | -231 | 2,126 | -139 | 2,485 | 1,259 | 1,357 | 5,731 | 195,409 | ||||||||
Other revenue | 2,385 | 3,093 | 2,048 | 896 | 2,179 | 2,481 | 2,715 | 2,539 | 8,422 | 9,914 | 28,145 | ||||||||
Loss incurred, net | 117,074 | 115,254 | 141,141 | 122,608 | 196,055 | 180,189 | 196,274 | 266,208 | 496,077 | 838,726 | 2,067,253 | ||||||||
Underwriting and other expenses, net | 48,181 | 47,595 | 43,455 | 51,766 | 56,062 | 61,810 | 54,221 | 74,768 | 190,997 | 246,861 | |||||||||
Provision for (benefit from) income taxes (note 14) | 681 | 249 | 1,118 | 726 | 1,231 | 336 | 990 | 1,139 | 2,774 | 3,696 | -1,565 | ||||||||
Net income (loss) | $74,428 | $72,017 | $45,522 | $59,982 | ($1,407) | $12,114 | $12,375 | ($72,930) | $251,949 | ($49,848) | ($927,079) | ||||||||
Income (loss) per share [Abstract] | |||||||||||||||||||
Basic (in dollars per share) | $0.22 | [1],[2] | $0.21 | [1],[2] | $0.13 | [1],[2] | $0.18 | [1],[2] | $0 | [1] | $0.04 | [1] | $0.04 | [1] | ($0.31) | [1] | $0.74 | ($0.16) | ($4.59) |
Diluted (in dollars per share) | $0.19 | [1],[2] | $0.18 | [1],[2] | $0.12 | [1],[2] | $0.15 | [1],[2] | $0 | [1] | $0.04 | [1] | $0.04 | [1] | ($0.31) | [1] | $0.64 | ($0.16) | ($4.59) |
[1] | Due to the use of weighted average shares outstanding when calculating earnings per share, the sum of the quarterly per share data may not equal the per share data for the year. | ||||||||||||||||||
[2] | In periods where convertible debt instruments are dilutive to earnings per share the "if-converted" method of computing diluted EPS requires an interest expense adjustment, net of tax, to net income available to shareholders. This adjustment has not been reflected in the Unaudited Quarterly Financial Data presented. See Note 3 - "Summary of Significant Accounting Policies" for further discussion. |
SCHEDULE_ISUMMARY_OF_INVESTMEN1
SCHEDULE I-SUMMARY OF INVESTMENTS-OTHER THAN INVESTMENTS IN RELATED PARTIES (Details) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | $4,605,517 |
Fair Value | 4,612,669 |
Amount at which shown in the balance sheet | 4,612,669 |
Equity Securities, Common Stocks [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 3,003 |
Fair Value | 3,055 |
Amount at which shown in the balance sheet | 3,055 |
Equity Securities, Common Stocks [Member] | Industrial, Miscellaneous, and All Others [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 3,003 |
Fair Value | 3,055 |
Amount at which shown in the balance sheet | 3,055 |
Fixed Maturities, Bonds [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 4,602,514 |
Fair Value | 4,609,614 |
Amount at which shown in the balance sheet | 4,609,614 |
Fixed Maturities, Bonds [Member] | US Government and Government Agencies and Authorities [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 349,153 |
Fair Value | 346,775 |
Amount at which shown in the balance sheet | 346,775 |
Fixed Maturities, Bonds [Member] | States, Municipalities and Political Subdivisions [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 844,942 |
Fair Value | 855,142 |
Amount at which shown in the balance sheet | 855,142 |
Fixed Maturities, Bonds [Member] | Foreign Governments [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 35,630 |
Fair Value | 39,170 |
Amount at which shown in the balance sheet | 39,170 |
Fixed Maturities, Bonds [Member] | Public Utilities [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 214,179 |
Fair Value | 215,048 |
Amount at which shown in the balance sheet | 215,048 |
Fixed Maturities, Bonds [Member] | Asset-Backed Securities [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 286,260 |
Fair Value | 286,655 |
Amount at which shown in the balance sheet | 286,655 |
Fixed Maturities, Bonds [Member] | Collateralized Loan Obligations [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 61,340 |
Fair Value | 60,076 |
Amount at which shown in the balance sheet | 60,076 |
Fixed Maturities, Bonds [Member] | Mortgage Backed Securities [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 606,198 |
Fair Value | 596,515 |
Amount at which shown in the balance sheet | 596,515 |
Fixed Maturities, Bonds [Member] | All Other Corporate Bonds [Member] | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized Cost | 2,204,812 |
Fair Value | 2,210,233 |
Amount at which shown in the balance sheet | $2,210,233 |
SCHEDULE_IICONDENSED_FINANCIAL1
SCHEDULE II-CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Details) (USD $) | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2013 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Apr. 30, 2012 | Dec. 31, 2011 |
ASSETS | ||||||||||||||
Fixed maturities (amortized cost, 2014-$482,629; 2013-$548,528) | $4,609,614 | $4,863,925 | $4,609,614 | $4,863,925 | ||||||||||
Cash and cash equivalents | 197,882 | 332,692 | 197,882 | 332,692 | 1,027,625 | |||||||||
Accrued investment income | 30,518 | 31,660 | 30,518 | 31,660 | ||||||||||
Other assets | 106,390 | 141,451 | 106,390 | 141,451 | ||||||||||
Total assets | 5,266,434 | 5,601,390 | 5,266,434 | 5,601,390 | ||||||||||
Liabilities: | ||||||||||||||
Senior notes | 61,918 | 82,773 | 61,918 | 82,773 | ||||||||||
Convertible senior notes | 845,000 | 845,000 | 845,000 | 845,000 | ||||||||||
Convertible junior debentures | 389,522 | 389,522 | 389,522 | 389,522 | ||||||||||
Total liabilities | 4,229,531 | 4,856,852 | 4,229,531 | 4,856,852 | ||||||||||
Shareholders' equity | ||||||||||||||
Common stock (one dollar par value, shares authorized 1,000,000; shares issued 2014 and 2013 - 340,047; outstanding 2014 - 338,560; 2013 - 337,758) | 340,047 | 340,047 | 340,047 | 340,047 | ||||||||||
Paid-in capital | 1,663,592 | 1,661,269 | 1,663,592 | 1,661,269 | ||||||||||
Treasury stock (shares at cost 2014, - 1,487; 2013 - 2,289) | -32,937 | -64,435 | -32,937 | -64,435 | ||||||||||
Accumulated other comprehensive (loss) income, net of tax | -81,341 | -117,726 | -81,341 | -117,726 | -48,163 | |||||||||
Retained deficit | -852,458 | -1,074,617 | -852,458 | -1,074,617 | ||||||||||
Total shareholders' equity | 1,036,903 | 744,538 | 1,036,903 | 744,538 | 196,940 | 1,196,815 | ||||||||
Total liabilities and shareholders' equity | 5,266,434 | 5,601,390 | 5,266,434 | 5,601,390 | ||||||||||
Parenthetical information [Abstract] | ||||||||||||||
Fixed maturities, amortized cost | 4,602,514 | 4,948,543 | 4,602,514 | 4,948,543 | ||||||||||
Common stock, par value (in dollars per share) | $1 | $1 | $1 | $1 | ||||||||||
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | 680,000 | 1,000,000 | 1,000,000 | 460,000 | ||||||||
Common stock, shares issued (in shares) | 340,047 | 340,047 | 340,047 | 340,047 | ||||||||||
Common stock, shares outstanding (in shares) | 338,560 | 337,758 | 338,560 | 337,758 | ||||||||||
Treasury stock, shares at cost (in shares) | 1,487 | 2,289 | 1,487 | 2,289 | ||||||||||
Revenues: | ||||||||||||||
Investment income, net of expenses | 23,956 | 22,355 | 21,180 | 20,156 | 21,278 | 20,250 | 20,883 | 18,328 | 87,647 | 80,739 | 121,640 | |||
Realized investment gains, net | 1,501 | 6,059 | 197,719 | |||||||||||
Other income | 2,385 | 3,093 | 2,048 | 896 | 2,179 | 2,481 | 2,715 | 2,539 | 8,422 | 9,914 | 28,145 | |||
Total revenues | 941,797 | 1,039,435 | 1,378,364 | |||||||||||
Expenses: | ||||||||||||||
Interest expense | 69,648 | 79,663 | 99,344 | |||||||||||
Total expenses | 687,074 | 1,085,587 | 2,307,008 | |||||||||||
Income (loss) before tax | 254,723 | -46,152 | -928,644 | |||||||||||
Benefit from income taxes | 681 | 249 | 1,118 | 726 | 1,231 | 336 | 990 | 1,139 | 2,774 | 3,696 | -1,565 | |||
Net income (loss) | 74,428 | 72,017 | 45,522 | 59,982 | -1,407 | 12,114 | 12,375 | -72,930 | 251,949 | -49,848 | -927,079 | |||
Other comprehensive income (loss), net of tax | 36,385 | -69,563 | -78,287 | |||||||||||
Comprehensive income (loss) | 288,334 | -119,411 | -1,005,366 | |||||||||||
Cash flows from operating activities: | ||||||||||||||
Net income (loss) | 74,428 | 72,017 | 45,522 | 59,982 | -1,407 | 12,114 | 12,375 | -72,930 | 251,949 | -49,848 | -927,079 | |||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||||
Other | -5,084 | 30,077 | -21,802 | |||||||||||
Change in certain assets and liabilities: | ||||||||||||||
Accrued investment income | 1,142 | -4,417 | 28,423 | |||||||||||
Cash flows from investing activities: | ||||||||||||||
Purchase of fixed maturities | -1,979,917 | -3,248,602 | -5,025,204 | |||||||||||
Sale of fixed maturities | 1,147,624 | 1,054,985 | 5,216,934 | |||||||||||
Cash flows from financing activities: | ||||||||||||||
Common stock shares issued | 663,300 | 0 | 663,335 | 0 | ||||||||||
Net (decrease) increase in cash and cash equivalents | -134,810 | -694,933 | 31,826 | |||||||||||
Cash and cash equivalents at beginning of year | 332,692 | 1,027,625 | 332,692 | 1,027,625 | 995,799 | |||||||||
Cash and cash equivalents at end of year | 197,882 | 332,692 | 197,882 | 332,692 | 1,027,625 | |||||||||
Dividends and Dividend Restrictions [Abstract] | ||||||||||||||
Percentage of statutory policyholders' surplus used to determine maximum allowable dividends (in hundredths) | 10.00% | 10.00% | ||||||||||||
Parent Company [Member] | ||||||||||||||
ASSETS | ||||||||||||||
Fixed maturities (amortized cost, 2014-$482,629; 2013-$548,528) | 480,125 | 539,124 | 480,125 | 539,124 | ||||||||||
Cash and cash equivalents | 10,507 | 20,725 | 10,507 | 20,725 | 175,880 | |||||||||
Investment in subsidiaries, at equity in net assets | 1,821,024 | 1,475,956 | 1,821,024 | 1,475,956 | ||||||||||
Accounts receivable - affiliates | 312 | 380 | 312 | 380 | ||||||||||
Income taxes receivable | 17,478 | 17,958 | 17,478 | 17,958 | ||||||||||
Accrued investment income | 3,435 | 3,629 | 3,435 | 3,629 | ||||||||||
Other assets | 15,156 | 18,943 | 15,156 | 18,943 | ||||||||||
Total assets | 2,348,037 | 2,076,715 | 2,348,037 | 2,076,715 | ||||||||||
Liabilities: | ||||||||||||||
Senior notes | 61,918 | 82,773 | 61,918 | 82,773 | ||||||||||
Convertible senior notes | 845,000 | 845,000 | 845,000 | 845,000 | ||||||||||
Convertible junior debentures | 389,522 | 389,522 | 389,522 | 389,522 | ||||||||||
Accrued interest | 14,694 | 14,882 | 14,694 | 14,882 | ||||||||||
Total liabilities | 1,311,134 | 1,332,177 | 1,311,134 | 1,332,177 | ||||||||||
Shareholders' equity | ||||||||||||||
Common stock (one dollar par value, shares authorized 1,000,000; shares issued 2014 and 2013 - 340,047; outstanding 2014 - 338,560; 2013 - 337,758) | 340,047 | 340,047 | 340,047 | 340,047 | ||||||||||
Paid-in capital | 1,663,592 | 1,661,269 | 1,663,592 | 1,661,269 | ||||||||||
Treasury stock (shares at cost 2014, - 1,487; 2013 - 2,289) | -32,937 | -64,435 | -32,937 | -64,435 | ||||||||||
Accumulated other comprehensive (loss) income, net of tax | -81,341 | -117,726 | -81,341 | -117,726 | ||||||||||
Retained deficit | -852,458 | -1,074,617 | -852,458 | -1,074,617 | ||||||||||
Total shareholders' equity | 1,036,903 | 744,538 | 1,036,903 | 744,538 | ||||||||||
Total liabilities and shareholders' equity | 2,348,037 | 2,076,715 | 2,348,037 | 2,076,715 | ||||||||||
Parenthetical information [Abstract] | ||||||||||||||
Fixed maturities, amortized cost | 482,629 | 548,528 | 482,629 | 548,528 | ||||||||||
Common stock, par value (in dollars per share) | $1 | $1 | $1 | $1 | ||||||||||
Common stock, shares authorized (in shares) | 1,000,000 | 1,000,000 | 1,000,000 | 1,000,000 | ||||||||||
Common stock, shares issued (in shares) | 340,047 | 340,047 | 340,047 | 340,047 | ||||||||||
Common stock, shares outstanding (in shares) | 338,560 | 337,758 | 338,560 | 337,758 | ||||||||||
Treasury stock, shares at cost (in shares) | 1,487 | 2,289 | 1,487 | 2,289 | ||||||||||
Revenues: | ||||||||||||||
Investment income, net of expenses | 6,985 | 5,033 | 6,921 | |||||||||||
Realized investment gains, net | 395 | 830 | 9,895 | |||||||||||
Other income | 0 | 0 | 17,775 | |||||||||||
Total revenues | 7,380 | 5,863 | 34,591 | |||||||||||
Expenses: | ||||||||||||||
Operating expenses | 1,383 | 511 | 2,227 | |||||||||||
Interest expense | 69,648 | 79,663 | 99,344 | |||||||||||
Total expenses | 71,031 | 80,174 | 101,571 | |||||||||||
Income (loss) before tax | -63,651 | -74,311 | -66,980 | |||||||||||
Benefit from income taxes | 0 | 0 | 0 | |||||||||||
Equity in undistributed net income (loss) of subsidiaries | 315,600 | 24,463 | -860,099 | |||||||||||
Net income (loss) | 251,949 | -49,848 | -927,079 | |||||||||||
Other comprehensive income (loss), net of tax | 36,385 | -69,563 | -78,287 | |||||||||||
Comprehensive income (loss) | 288,334 | -119,411 | -1,005,366 | |||||||||||
Cash flows from operating activities: | ||||||||||||||
Net income (loss) | 251,949 | -49,848 | -927,079 | |||||||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||||||
Equity in undistributed net (income) loss of subsidiaries | -315,600 | -24,463 | 860,099 | |||||||||||
Other | 14,862 | 21,693 | 23,765 | |||||||||||
Change in certain assets and liabilities: | ||||||||||||||
Accounts receivable - affiliates | 68 | 289 | -753 | |||||||||||
Income taxes receivable | 480 | -3 | 5,909 | |||||||||||
Accrued investment income | 194 | -2,611 | 2,702 | |||||||||||
Accrued interest | -188 | -15,577 | 17,288 | |||||||||||
Net cash used in operating activities | -48,235 | -70,520 | -18,069 | |||||||||||
Cash flows from investing activities: | ||||||||||||||
Transactions with subsidiaries | 0 | -800,000 | -100,000 | |||||||||||
Purchase of fixed maturities | -553,538 | -563,968 | -120,181 | |||||||||||
Sale of fixed maturities | 613,322 | 148,608 | 409,601 | |||||||||||
Net cash (used in) provided by investing activities | 59,784 | -1,215,360 | 189,420 | |||||||||||
Cash flows from financing activities: | ||||||||||||||
Repayment of long-term debt | -21,767 | -17,235 | -53,107 | |||||||||||
Net proceeds from convertible senior notes | 0 | 484,625 | 0 | |||||||||||
Common stock shares issued | 0 | 663,335 | 0 | |||||||||||
Net cash provided by (used in) financing activities | -21,767 | 1,130,725 | -53,107 | |||||||||||
Net (decrease) increase in cash and cash equivalents | -10,218 | -155,155 | 118,244 | |||||||||||
Cash and cash equivalents at beginning of year | 20,725 | 175,880 | 20,725 | 175,880 | 57,636 | |||||||||
Cash and cash equivalents at end of year | $10,507 | $20,725 | $10,507 | $20,725 | $175,880 | |||||||||
Dividends and Dividend Restrictions [Abstract] | ||||||||||||||
Percentage of statutory policyholders' surplus used to determine maximum allowable dividends (in hundredths) | 10.00% | 10.00% |
SCHEDULE_IVREINSURANCE_Details
SCHEDULE IV-REINSURANCE (Details) (USD $) | 12 Months Ended | ||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
SCHEDULE IV-REINSURANCE [Abstract] | |||
Gross amount | $950,973 | $979,078 | $1,065,663 |
Ceded to other companies | 108,255 | 38,101 | 34,918 |
Assumed from other companies | 1,653 | 2,074 | 2,425 |
Net amount | $844,371 | $943,051 | $1,033,170 |
Percentage of amount assumed to net | 0.20% | 0.20% | 0.20% |