Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2014 | |
Document Information [Line Items] | |
Document Type | S-1 |
Amendment Flag | FALSE |
Document Period End Date | 31-Dec-14 |
Entity Registrant Name | LINCOLN BENEFIT LIFE CO |
Entity Central Index Key | 910739 |
Entity Filer Category | Non-accelerated Filer |
Consolidated_Balance_Sheet_Suc
Consolidated Balance Sheet (Successor) and Balance Sheet (Predecessor) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
ASSETS | ||
Fixed maturities, available-for-sale, at fair value (amortized cost $9,231,856 and $284,928) | $9,390,647 | |
Commercial mortgage loans | 1,115,167 | |
Policy loans | 194,385 | |
Short-term investments | 361,369 | |
Other invested assets | 26,897 | |
Total Investments | 11,088,465 | |
Cash | 49,730 | |
Accrued investment income | 96,408 | |
Valuation of business acquired | 231,521 | |
Deposit receivable | 1,383,388 | |
Other assets | 592,202 | |
Separate account assets | 1,573,865 | |
Total Assets | 20,710,544 | |
LIABILITIES | ||
Future policy benefits and other policyholder liabilities | 6,463,964 | |
Policyholders' account balances | 9,829,337 | |
Accrued expenses and other liabilities | 188,616 | |
Modified coinsurance payable | 1,383,388 | |
Deferred income tax, net | 40,732 | |
Other long-term debt-affiliate | 551,600 | |
Separate account liabilities | 1,573,865 | |
Total Liabilities | 20,031,502 | |
Commitments and Contingent Liabilities (Note 12) | ||
SHAREHOLDER'S EQUITY | ||
Common stock, $100 par value, 30,000 shares authorized, 25,000 shares issued and outstanding | 2,500 | |
Additional paid-in capital | 593,558 | |
Accumulated other comprehensive income | 85,498 | |
Retained earnings | -2,514 | |
Total Shareholder's Equity | 679,042 | |
Total Liabilities and Shareholder's Equity | 20,710,544 | |
Non-affiliates | ||
ASSETS | ||
Reinsurance recoverable | 5,694,965 | |
Predecessor | ||
ASSETS | ||
Fixed maturities, available-for-sale, at fair value (amortized cost $9,231,856 and $284,928) | 290,882 | |
Short-term investments | 55,959 | |
Total Investments | 346,841 | |
Cash | 5,100 | |
Other assets | 83,735 | |
Separate account assets | 1,700,566 | |
Total Assets | 18,844,833 | |
LIABILITIES | ||
Future policy benefits and other policyholder liabilities | 3,557,411 | |
Policyholders' account balances | 13,124,115 | |
Accrued expenses and other liabilities | 112,576 | |
Current income tax | 3,906 | |
Deferred income tax, net | 2,564 | |
Separate account liabilities | 1,700,566 | |
Total Liabilities | 18,501,138 | |
Commitments and Contingent Liabilities (Note 12) | ||
SHAREHOLDER'S EQUITY | ||
Common stock, $100 par value, 30,000 shares authorized, 25,000 shares issued and outstanding | 2,500 | |
Additional paid-in capital | 180,000 | |
Accumulated other comprehensive income | 3,870 | |
Retained earnings | 157,325 | |
Total Shareholder's Equity | 343,695 | |
Total Liabilities and Shareholder's Equity | 18,844,833 | |
Predecessor | Non-affiliates | ||
ASSETS | ||
Reinsurance recoverable | 2,190,417 | |
Predecessor | Affiliates | ||
ASSETS | ||
Reinsurance recoverable | $14,518,174 |
Consolidated_Balance_Sheet_Suc1
Consolidated Balance Sheet (Successor) and Balance Sheet (Predecessor) (Parenthetical) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Fixed maturities, available-for-sale, amortized cost | $9,231,856 | |
Common stock, par value | $100 | |
Common stock, shares authorized | 30,000 | |
Common stock, shares issued | 25,000 | |
Common stock, shares outstanding | 25,000 | |
Predecessor | ||
Fixed maturities, available-for-sale, amortized cost | $284,928 | |
Common stock, par value | $100 | |
Common stock, shares authorized | 30,000 | |
Common stock, shares issued | 25,000 | |
Common stock, shares outstanding | 25,000 |
Consolidated_Statement_of_Oper
Consolidated Statement of Operations and Comprehensive Income (Loss) (Successor) and Statements of Operations and Comprehensive Income (Loss)(Predecessor) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues | ||||
Premiums earned | $20,384 | |||
Fee income from policyholders | 259,169 | |||
Net investment income | 288,571 | |||
Realized investment gains, net | 46,092 | |||
Total revenues | 614,216 | |||
Expenses | ||||
Policyholder benefits | 216,543 | |||
Return credited to policyholders' account balances | 256,703 | |||
Operating and acquisition expenses | 96,050 | |||
Total expenses | 569,296 | |||
Income Before Federal Income Tax | 44,920 | |||
Federal Income Tax Expense (Benefit) | ||||
Deferred | 14,234 | |||
Total income tax expense | 14,234 | |||
NET INCOME | 30,686 | |||
Net unrealized investment gains (losses): | ||||
Unrealized investment gains (losses) for the period | 131,433 | |||
Net unrealized investment gains (losses) | 131,433 | |||
Less: Income tax (benefit) related to: | ||||
Unrealized investment gains (losses) for the period | -45,935 | |||
Net unrealized investment gains (losses) | -45,935 | |||
Other comprehensive (loss) income | 85,498 | |||
Comprehensive (loss) income | 116,184 | |||
Predecessor | ||||
Revenues | ||||
Net investment income | 2,350 | 10,935 | 11,590 | |
Realized investment gains, net | 285 | 626 | ||
Total revenues | 2,635 | 10,935 | 12,216 | |
Expenses | ||||
Income Before Federal Income Tax | 2,635 | 10,935 | 12,216 | |
Federal Income Tax Expense (Benefit) | ||||
Current | 914 | 3,902 | 4,145 | |
Deferred | 8 | -77 | 128 | |
Total income tax expense | 922 | 3,825 | 4,273 | |
NET INCOME | 1,713 | 7,110 | 7,943 | |
Net unrealized investment gains (losses): | ||||
Unrealized investment gains (losses) for the period | 2,364 | -15,281 | 977 | |
Reclassification adjustment for (gains) losses included in net income | 285 | 1 | 596 | |
Net unrealized investment gains (losses) | 2,079 | -15,282 | 381 | |
Less: Income tax (benefit) related to: | ||||
Unrealized investment gains (losses) for the period | -828 | 5,349 | -343 | |
Reclassification adjustment for (gains) losses included in net income | -100 | -209 | ||
Net unrealized investment gains (losses) | -728 | 5,349 | -134 | |
Other comprehensive (loss) income | 1,351 | -9,933 | 247 | |
Comprehensive (loss) income | $3,064 | ($2,823) | $8,190 |
Consolidated_Statement_of_Shar
Consolidated Statement of Shareholder's Equity (Successor) and Statement of Shareholder's Equity (Predecessor) (USD $) | Total | Predecessor | Common Stock | Common Stock | Additional Paid-In Capital | Additional Paid-In Capital | Retained Earnings | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) |
In Thousands, except Share data, unless otherwise specified | Predecessor | Predecessor | Predecessor | Predecessor | ||||||
Balance at Dec. 31, 2011 | $338,328 | $2,500 | $180,000 | $142,272 | $13,556 | |||||
Balance, shares at Dec. 31, 2011 | 25,000 | |||||||||
Comprehensive income (loss) | ||||||||||
Net income (loss) | 7,943 | 7,943 | ||||||||
Other comprehensive income (loss), net of tax | 247 | 247 | ||||||||
Total comprehensive income (loss) | 8,190 | |||||||||
Balance at Dec. 31, 2012 | 346,518 | 2,500 | 180,000 | 150,215 | 13,803 | |||||
Balance, shares at Dec. 31, 2012 | 25,000 | |||||||||
Comprehensive income (loss) | ||||||||||
Net income (loss) | 7,110 | 7,110 | ||||||||
Other comprehensive income (loss), net of tax | -9,933 | -9,933 | ||||||||
Total comprehensive income (loss) | -2,823 | |||||||||
Balance at Dec. 31, 2013 | 343,695 | 2,500 | 180,000 | 157,325 | 3,870 | |||||
Balance, shares at Dec. 31, 2013 | 25,000 | |||||||||
Comprehensive income (loss) | ||||||||||
Net income (loss) | 1,713 | 1,713 | ||||||||
Other comprehensive income (loss), net of tax | 1,351 | 1,351 | ||||||||
Total comprehensive income (loss) | 3,064 | |||||||||
Balance at Mar. 31, 2014 | 595,808 | 346,759 | 2,500 | 2,500 | 593,308 | 180,000 | 159,038 | 5,221 | ||
Balance, shares at Mar. 31, 2014 | 25,000 | 25,000 | ||||||||
Dividends to shareholder | -33,200 | -33,200 | ||||||||
Capital contribution | 250 | 250 | ||||||||
Comprehensive income (loss) | ||||||||||
Net income (loss) | 30,686 | 30,686 | ||||||||
Other comprehensive income (loss), net of tax | 85,498 | 85,498 | ||||||||
Total comprehensive income (loss) | 116,184 | |||||||||
Balance at Dec. 31, 2014 | $679,042 | $2,500 | $593,558 | ($2,514) | $85,498 | |||||
Balance, shares at Dec. 31, 2014 | 25,000 |
Consolidated_Statement_of_Cash
Consolidated Statement of Cash Flows (Successor) and Statements of Cash Flows (Predecessor) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Cash flows from operating activities: | ||||
Net income | $30,686 | |||
Adjustments to reconcile net loss to net cash: | ||||
Policy charges and fee income | -259,169 | |||
Return credited to policyholders' account balances | 256,703 | |||
Realized Investment gains, net | -46,092 | |||
Amortization/accretion of bond premium, net | 44,112 | |||
Amortization of value of business acquired | 38,987 | |||
Changes in assets and liabilities: | ||||
Decrease (increase) in insurance related liabilities and policy-related balances | -21,964 | |||
Deferred income tax expense (benefit) | 14,234 | |||
Decrease (increase) in accrued investment income | 6,838 | |||
Decrease (increase) in other assets and liabilities | 31,780 | |||
Net cash provided by (used in) operating activities | 96,115 | |||
Cash flows from investing activities: | ||||
Fixed maturities, available for sale Proceeds from sales and maturities | 1,844,344 | |||
Fixed maturities, available for sale, Purchases | -1,898,874 | |||
Proceeds from sales and maturities of commercial mortgage loans | 150,849 | |||
Net purchases, sales, maturities of derivatives | -8,636 | |||
Net purchases, sales, maturities of other investments | 620,425 | |||
Net cash provided by (used in) investing activities | 708,108 | |||
Cash flows from financing activities: | ||||
Policyholders' account deposits | 340,128 | |||
Policyholders' account withdrawals | -1,141,289 | |||
Dividends paid to shareholder | -33,200 | |||
Change in overdrafts | 39,089 | |||
Capital contribution | 250 | |||
Net cash provided by (used in) financing activities | -795,022 | |||
Net increase (decrease) in cash | 9,201 | |||
Cash, beginning of period | 40,529 | |||
Cash, end of period | 49,730 | |||
Supplemental schedule of cash flow information: | ||||
Cash received | 9,201 | |||
Interest paid | 4,585 | |||
Noncash activities | ||||
Issuance of vehicle note | 513,000 | |||
Issuance of other long-term debt | 513,000 | |||
Interest income on vehicle note | 15,711 | |||
Interest expense on other long-term debt | 15,711 | |||
Increase in vehicle note and other long-term debt | 38,600 | |||
Increase in modified coinsurance payable and deposit receivable | 166,963 | |||
Predecessor | ||||
Cash flows from operating activities: | ||||
Net income | 1,713 | 7,110 | 7,943 | |
Adjustments to reconcile net loss to net cash: | ||||
Realized Investment gains, net | -285 | -626 | ||
Amortization/accretion of bond premium, net | 94 | 630 | 781 | |
Changes in assets and liabilities: | ||||
Decrease (increase) in insurance related liabilities and policy-related balances | 6,402 | -6,147 | 14,398 | |
Decrease (increase) in receivable from/payable to affiliate | 24,358 | -17,255 | 25,752 | |
Deferred income tax expense (benefit) | 921 | -329 | -516 | |
Decrease (increase) in other assets and liabilities | -23,192 | 16,007 | -32,761 | |
Net cash provided by (used in) operating activities | 10,011 | 16 | 14,971 | |
Cash flows from investing activities: | ||||
Fixed maturities, available for sale Proceeds from sales and maturities | 21,341 | 62,645 | 54,521 | |
Fixed maturities, available for sale, Purchases | -38,896 | -51,209 | ||
Net purchases, sales, maturities of other investments | 55,924 | -31,738 | -11,216 | |
Net cash provided by (used in) investing activities | 77,265 | -7,989 | -7,904 | |
Cash flows from financing activities: | ||||
Net increase (decrease) in cash | 87,276 | -7,973 | 7,067 | |
Cash, beginning of period | 5,100 | 13,073 | 6,006 | |
Cash, end of period | 92,376 | 5,100 | 13,073 | |
Supplemental schedule of cash flow information: | ||||
Cash received | 87,276 | -7,973 | 7,067 | |
Income taxes paid | 4,200 | 4,800 | ||
Invested assets transferred | 11,482,637 | |||
Predecessor | On April 1, 2014 | ||||
Cash flows from financing activities: | ||||
Net increase (decrease) in cash | 143,348 | |||
Supplemental schedule of cash flow information: | ||||
Cash received | 143,348 | |||
Predecessor | Subsequent to April 1, 2014 | ||||
Cash flows from financing activities: | ||||
Net increase (decrease) in cash | 5,946 | |||
Supplemental schedule of cash flow information: | ||||
Cash received | $5,946 |
General
General | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
General | 1 | General | |||
Lincoln Benefit Life Company (the “Company” or “Lincoln Benefit”) is a stock insurance company domiciled in the State of Nebraska. It is a wholly owned subsidiary of Resolution Life, Inc. (“Resolution”), which in turn is a wholly owned subsidiary of Resolution Life Holdings, Inc. (“Holdings”). Resolution was formed on July 2, 2013 under the General Corporation Law of the State of Delaware. | |||||
On April 1, 2014, Lancaster Re Captive Insurance Company (“Lancaster Re”), a Nebraska domiciled captive insurance company, became a wholly owned subsidiary of Lincoln Benefit when it was contributed to Lincoln Benefit by Resolution. | |||||
The Company became a wholly owned subsidiary of Resolution on April 1, 2014 after receiving all required regulatory approvals. Prior to this date, it was a wholly owned subsidiary of Allstate Life Insurance Company (“ALIC”). On July 17, 2013, Holdings executed a Stock Purchase Agreement (the “Acquisition”) to acquire 100% of the Company from ALIC. In November 2013, Holdings assigned the right to acquire all of Lincoln Benefit’s outstanding capital stock to Resolution pursuant to an Assignment Agreement. The purchase price was $595.8 million. | |||||
The Company is authorized to sell life insurance and retirement products in all states except New York, as well as in the District of Columbia, the U.S. Virgin Islands and Guam. Prior to July 18, 2013, the Company sold interest-sensitive, traditional and variable life insurance products through both exclusive agencies (“Allstate Financial Sales channel”) and independent master brokerage agencies. Effective July 17, 2013, sales through the independent master brokerage agencies ceased, and sales through the Allstate Financial sales channel will continue for a period up to 30 months after the closing date of Acquisition. We operate as a single segment entity, based on the manner in which we use financial information to evaluate business performance and to determine the allocation of resources. | |||||
On April 1, 2014, immediately prior to the Acquisition (Predecessor Period), the Company, pursuant to a Partial Commutation Agreement, recaptured all deferred annuity, long-term care, accident and health and life business sold through Lincoln Benefit’s independent master brokerage agencies, other than specified life business, previously reinsured by ALIC. The primary impacts of the Partial Commutation Agreement with ALIC were the receipt of investments, the reduction of the related reinsurance recoverable and the reestablishment of deferred acquisition costs. The Company’s assets and liabilities increased by $1.33 billion and $0.19 billion, respectively. Since the Partial Commutation Agreement occurred between entities under common control, the excess of assets received and liabilities assumed was recorded as a capital contribution through additional paid-in capital. | |||||
Additionally, Lincoln Benefit and ALIC entered into an Amended and Restated Reinsurance Agreement where ALIC continues to reinsure all life insurance business written by Lincoln Benefit through the Allstate Financial Sales channel, all immediate annuities written by Lincoln Benefit prior to closing of the Acquisition, and certain term life policies written by Lincoln Benefit. Lincoln Benefit’s variable annuity business will remain reinsured by ALIC under an existing reinsurance agreement between Lincoln Benefit and ALIC. This business will continue to be administered by ALIC under an existing administrative services agreement between Lincoln Benefit and ALIC. | |||||
Under the acquisition method of accounting, the assets acquired and liabilities assumed are recorded at fair value at the date of acquisition. The following table summarizes the fair values of assets acquired and liabilities assumed as of April 1, 2014: | |||||
($ in thousands) | |||||
Assets | |||||
Fixed maturities | $ | 9,194,903 | |||
Commercial mortgage loans | 1,263,902 | ||||
Policy loans | 196,451 | ||||
Short-term investments | 979,728 | ||||
Other invested assets | 1,104 | ||||
Cash | 40,529 | ||||
Accrued investment income | 103,246 | ||||
Reinsurance recoverable | 5,606,879 | ||||
Value of business acquired | 290,795 | ||||
Deposit receivable | 1,550,351 | ||||
Intangibles | 5,200 | ||||
Other assets | 554,176 | ||||
Separate account assets | 1,661,007 | ||||
Total assets acquired | 21,448,271 | ||||
Liabilities | |||||
Future policy benefits and other policyholder liabilities | 6,682,833 | ||||
Policyholders’ account balances | 10,367,246 | ||||
Accrued expenses and other liabilities | 78,026 | ||||
Modified coinsurance payable | 1,550,351 | ||||
Other long-term debt — affiliate | 513,000 | ||||
Separate account liabilities | 1,661,007 | ||||
Total liabilities assumed | 20,852,463 | ||||
Net assets acquired | $ | 595,808 | |||
Included in the assets acquired is the value of business acquired (“VOBA”), which reflects the estimated fair value of in-force contracts acquired and represents the portion of the purchase price that is allocated to the future profits embedded in the acquired contracts at the acquisition date. See Note 11 for further explanation of VOBA. The assessment of fair value in accordance with ASC 805-20-25 included the establishment of intangible assets for VOBA and various state licenses. | |||||
Basis of Presentation | |||||
The Company’s financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The financial statements are presented for Successor and Predecessor periods, which relate to the accounting periods after and before April 1, 2014, respectively, the date of the closing of the Acquisition. For periods after April 1, 2014, the accompanying financial statements comprise the consolidated financial statements of the Company, which include the accounts of the Company and its subsidiary. Due to the Acquisition and the application of push-down accounting, different bases of accounting have been used to prepare the Predecessor and Successor financial statements. A black line separates the Predecessor and Successor financial statements to highlight the lack of comparability between these two periods. The principal accounting policies applied in the preparation of these financial statements are set out below and in Note 2. | |||||
Consolidation | |||||
The accompanying consolidated financial statements of the Successor include the accounts of Lincoln Benefit and its subsidiary, Lancaster Re. All significant intercompany balances and transactions have been eliminated on consolidation. | |||||
Use of Estimates | |||||
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | |
Dec. 31, 2014 | ||
Significant Accounting Policies | 2 | Significant Accounting Policies |
Cash | ||
Cash includes cash on hand, amounts due from banks, money market securities, highly liquid overnight deposits, discount notes and commercial paper held in the ordinary course of business amounts due from banks, certain money market investments and other debt instruments with maturities of three months or less when purchased. | ||
Investments | ||
Fixed maturities include bonds, asset-backed securities (“ABS”) residential mortgage-backed securities (“RMBS”) and commercial mortgage-backed securities (“CMBS”). Fixed maturities, which may be sold prior to their contractual maturity, are designated as available-for-sale (“AFS”) and are carried at fair value. The difference between amortized cost and fair value, net of deferred income taxes, is reflected as a component of accumulated other comprehensive income. Cash received from calls, principal payments and make-whole payments and cash received from maturities and pay-downs are reflected as a component of proceeds from sales and maturities within the Consolidated Statement of Cash Flows — Successor and Statement of Cash Flows — Predecessor. | ||
The Company recognizes other-than-temporary impairments (“OTTI”) for securities classified as AFS in accordance with ASC 320, Investments-Debt and Equity Securities. At least quarterly, management reviews impaired securities for OTTI. The Company considers several factors when determining if a security is OTTI, including but not limited to: its intent and ability to hold the impaired security until an anticipated recovery in value, the issuer’s ability to meet current and future principal and interest obligations for fixed maturity securities, the length and severity of the impairment, the financial condition and near term and long term prospects for the issuer. In making these evaluations, the Company exercises considerable judgment. | ||
If the Company intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, then the Company recognizes a charge to earnings for the full amount of the impairment (the difference between the amortized cost and fair value of the security). For fixed maturity securities that are considered OTTI and that the Company does not intend to sell and will not be required to sell, the Company separates the impairment into two components: credit loss and noncredit loss. Credit losses are charged to net realized investment losses and noncredit losses are charged to other comprehensive income. The credit loss component is the difference between the security’s amortized cost and the present value of its expected future cash flows discounted at the current effective rate. The remaining difference between the security’s fair value and the present value of its expected future cash flows is the non-credit loss. For corporate bonds, historical default (by rating) data is used as a proxy for the probability of default, and loss given default (by issuer) projections are applied to the par amount of the bond. Potential losses incurred on structured securities are based on expected loss models rather than incurred loss models. Expected cash flows include assumptions about key systematic risks (e.g. unemployment rates, housing prices) and loan-specific information (e.g. delinquency rates, loan-to-value ratios). Estimating future cash flows is a quantitative and qualitative process that incorporates information received from third parties, along with assumptions and judgments about the future performance of the underlying collateral. | ||
Commercial mortgage loans (“CMLs”) acquired at fair value are carried at amortized cost using the effective interest rate method. CMLs held by the Company are diversified by property type and geographic area throughout the U.S. CMLs are considered impaired when it is probable that the Company will not collect amounts due according to the terms of the original loan agreement. The Company assesses the impairment of loans individually for all loans in the portfolio. The Company estimates the fair value of the underlying collateral using internal valuations generally based on discounted cash flow analyses. The Company estimates an allowance for loan and lease losses (“ALLL”) representing potential credit losses embedded in the CML portfolio. The estimate is based on a consistently applied analysis of the loan portfolio and takes into consideration all available information, including industry, geographical, economic and political factors. | ||
Policy loans represent loans the Company issues to policyholders. Policy loans are carried at unpaid principal balances. Interest income on such loans is recognized as earned using the contractually agreed upon interest rate and reflected in Net investment income in the Consolidated Statement of Operations and Comprehensive Income (Loss). Generally, interest is capitalized on the associated policy’s anniversary date. | ||
Short-term investments include securities and other investments with remaining maturities of one year or less, but greater than three months, at the time of purchase and are stated at estimated fair value or amortized cost, which approximates fair value. | ||
Derivatives | ||
As part of the Company’s overall risk management policy, the Company uses listed options and exchange traded futures to economically hedge its obligation under certain fixed indexed annuity and universal life contracts. Derivative financial instruments utilized by the Company in the period from April 1, 2014 through December 31, 2014 (the “Successor Period”) included index option contracts and futures contracts. Derivatives are carried in the Company’s Consolidated Balance Sheet either as assets within Other invested assets or as liabilities within Accrued expenses and other liabilities at estimated fair value. The Company offsets the fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. Accruals on derivatives are generally recorded in accrued investment income or within other liabilities. However, accruals that are not scheduled to settle within one year are included with the derivatives carrying value in other invested assets or other liabilities. If a derivative is not designated as an accounting hedge or its use in managing risk does not qualify for hedge accounting, changes in the estimated fair value of the derivative are reported in realized investment gains, net in the Consolidated Statement of Operations and Comprehensive Income (Loss). The notional amounts specified in the contracts are used to calculate contractual payments under the agreements and are generally not representative of the potential for gain or loss on these contracts. Futures contracts are defined as commitments to buy or sell designated financial instruments based on specified prices, yields or indexes. Futures contracts provide returns at specified or optional dates based upon a specified index or interest rate applied to a notional amount. The Company uses futures to hedge exposures in indexed annuity and life contracts. Daily cash settlement of variation margins is required for futures contracts and is based on the changes in daily prices. The final settlement of futures contracts is in cash. Index option contracts provide returns at specified or optional dates based on a specified equity index applied to the option’s notional amount. The Company purchases and writes (sells) option contracts primarily to reduce market risk associated with certain annuity and life contracts. When the Company purchases/sells option contracts at specific prices, it is required to pay/receive a premium to/from the counterparties. The amount of premium paid/received is based on the number of contracts purchased/sold, the specified price and the maturity date of the contract. The Company receives/pays cash equal to the premium of written/purchased options when the contract is established. If the option is exercised, the Company receives/pays cash equal to the product of the number of contracts and the specified price in the contract in exchange for the equity upon which the option is written/purchased. If the options are not exercised, then no additional cash is exchanged when the contract expires. Premiums paid are reported as a derivative asset and premiums received are reported as a derivative liability. Purchased put and call index option contracts are cash settled upon exercise and the gain or loss on the settlement is reported in net investment income. If the purchased option contract expires without being exercised, the premiums paid are reported as net investment income and the corresponding asset previously recorded is reversed. The change in the fair value of written option contracts is reported in Realized investment gains, net, with an adjustment to a corresponding liability. Written call index option contracts are cash settled upon exercise and the gain or loss on settlement is reported in Realized investment gains, net. | ||
The Company has derivatives embedded in non-derivative host contracts that are required to be separated from the host contracts and accounted for at fair value. The Company’s embedded derivatives are equity options in life and annuity product contracts, which provide equity returns to contractholders, guaranteed minimum accumulation and withdrawal benefits in variable annuity contracts. The Company has reinsurance agreements to transfer all the risk related to guarantee minimum income, accumulation and withdrawal benefits in variable annuity contracts to third party reinsurers. None of these derivatives are designated as accounting hedging instruments and all are gross liabilities reported in policyholder account balances or future policy benefits and other policyholder liabilities. | ||
Investment Income and Realized Gains and Losses | ||
Investment income primarily consists of interest and is recognized on an accrual basis using the effective yield method. Interest income for RMBS and CMBS is determined considering estimated pay-downs, including prepayments, obtained from third party data sources and internal estimates. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the prepayments originally anticipated and the actual prepayments received and currently anticipated. For RMBS and CMBS of high credit quality with fixed interest rates, the effective yield is recalculated on a retrospective basis. For all others, the effective yield is recalculated on a prospective basis. Accrual of income is suspended for other-than-temporarily impaired fixed maturities when the timing and amount of cash flows expected to be received is not reasonably estimable. It is the Company’s policy to cease to carry accrued interest on commercial mortgage loans that are over 90 days delinquent. The Company held no non-income producing investments as of December 31, 2014. | ||
Realized capital gains and losses include gains and losses on investment sales and write-downs in value due to other-than-temporary declines in fair value. Realized capital gains and losses on investment sales, including principal payments, are determined on a specific identification basis. | ||
Recognition of Premium Revenues and Fees, and Related Policyholders’ Benefits and Interest Credited | ||
Prior to April 1, 2014 or the periods prior to April 1, 2014 (the “Predecessor Periods”), the Company had reinsurance agreements whereby all premiums, fee income from policyholders and returns credited to policyholders, policyholder benefits and substantially all expenses were ceded to ALIC and other reinsurers. Amounts reflected in the Statements of Operations and Comprehensive Income (Loss) are presented net of reinsurance. | ||
Traditional life insurance products consist principally of products with fixed and guaranteed premiums and benefits, primarily term and whole life insurance products. Premiums from these products are recognized as revenue when due from policyholders. Surrender values on traditional life and death benefits are reflected in policyholder benefits. | ||
Immediate annuities with life contingencies provide insurance protection over a period that extends beyond the period during which premiums are collected. Premiums from these products are recognized as revenue when received at the inception of the contract. Benefits and expenses are recognized in relation to premiums. As of April 1, 2014, the Company has reinsurance agreements to transfer all the risk related to immediate annuities. | ||
Interest-sensitive life contracts, such as universal life and single premium life, are insurance contracts whose terms are not fixed or guaranteed. The terms that may be changed include premiums paid by the policyholder, interest credited to the policyholder account balance and contract charges assessed against the policyholder account balance. Premiums from these contracts are reported as policyholder account balances. Fee income from policyholders consist of fees assessed against the policyholder account balance for the cost of insurance (mortality risk), contract administration and surrender of the policy prior to contractually specified dates. These charges are recognized as revenue when assessed against the policyholder account balance. Policyholder benefits include life-contingent benefit payments in excess of the policyholder account balance. | ||
Contracts that do not subject the Company to significant risk arising from mortality or morbidity are referred to as investment contracts. Fixed annuities, including market value adjusted annuities, equity-indexed annuities and immediate annuities without life contingencies, are considered investment contracts. Consideration received for such contracts is reported as policyholder account balance deposits. Policy fees for investment contracts consist of fees assessed against the contractholder account balance for maintenance, administration and surrender of the contract prior to contractually specified dates, and are recognized when assessed against the policyholder account balance. | ||
Return credited to policyholder funds represents interest accrued or paid on interest-sensitive life and investment contracts. Crediting rates for certain fixed annuities and interest-sensitive life contracts are adjusted periodically by the Company to reflect current market conditions subject to contractually guaranteed minimum rates. Crediting rates for indexed life and annuities are generally based on an equity index, such as the Standard & Poor’s (“S&P”) 500 Index. | ||
Policy charges for variable life and variable annuity products consist of fees assessed against the policyholder account balances for contract maintenance, administration, mortality, expense and surrender of the contract prior to contractually specified dates. Policy benefits incurred for variable annuity products include guaranteed minimum death, income, withdrawal and accumulation benefits. | ||
The Company incurs significant costs in connection with renewal insurance business. All acquisition-related costs, including commissions, those related to general advertising, agent training, as well as all indirect costs, are expensed as incurred and reported in Operating and acquisition expenses on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the period from April 1, 2014 through December 31, 2014. The Company also receives expense allowances on reinsurance ceded. These amounts are recognized when earned and reported in Operating expenses and acquisition expenses on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the period from April 1, 2014 through December 31, 2014. | ||
Reinsurance | ||
Reinsurance accounting is applied for ceded and assumed transactions when the risk transfer provisions of ASC 944-40, Accounting and Reporting for Reinsurance of Short-Duration and Long-Duration Contracts, have been met. To meet risk transfer requirements, a long-duration reinsurance contract must transfer mortality or morbidity risks, and subject the reinsurer to a reasonable possibility of a significant loss. Those contracts that do not meet risk transfer requirements are accounted for using deposit accounting. For short duration contracts, to meet risk transfer requirements the reinsurer must assume significant insurance risk and have a reasonable possibility of experiencing significant loss. | ||
With respect to ceded reinsurance, the Company values reinsurance recoverables on reported claims at the time the underlying claim is recognized in accordance with contract terms. For future policy benefits, the Company estimates the amount of reinsurance recoverables based on the terms of the reinsurance contracts and historical reinsurance recovery information. The reinsurance recoverables are based on what the Company believes are reasonable estimates and the balance is reported as an asset in the Consolidated Balance Sheet (Successor) and Balance Sheets (Predecessor). However, the ultimate amount of the reinsurance recoverable is not known until all claims are settled. Reinsurance contracts do not relieve the Company from its obligations to policyholders, and failure of reinsurers to honor their obligations could result in losses to the Company, consequently, allowances are established for amounts deemed uncollectible. | ||
In the Predecessor periods, or the periods prior to April 1, 2014, the Company had reinsurance agreements whereby all insurance risks represented by premiums, fee income from policyholders, returns credited to policyholder account balances, policyholder benefits and substantially all expenses were ceded to ALIC and other reinsurers. Additionally, investment income earned on the assets that supported policyholder account balances and future policy benefits and other policyholder funds were not included in the Company’s financial statements as those assets were owned and managed by ALIC and other reinsurers under the terms of the reinsurance agreements. | ||
Value of Business Acquired (“VOBA”) | ||
For interest sensitive life products, VOBA is amortized over the life of the policies in relation to the emergence of estimated gross profits (“EGP’s”) from margins on mortality, interest, expenses, and surrenders, all of which are net of reinsurance and include actual realized gains and losses on investments. For non-interest sensitive life products, such as term life insurance, VOBA is amortized in relation to premium. VOBA is reviewed periodically for loss recognition to ensure that the unamortized balance is recoverable from future earnings from the business. The carrying amount of VOBA is adjusted for the effects of realized and unrealized gains and losses on debt securities classified as AFS. | ||
Separate Accounts | ||
Separate Accounts assets are carried at fair value. The assets of the Separate Accounts are legally segregated and available only to settle separate account contract obligations. Separate Account liabilities represent the contractholders’ claims to the related assets and are carried at an amount equal to the Separate Account assets. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contractholders and therefore are not included in the Company’s Consolidated Statement of Operations and Comprehensive Income (Successor) or Statements of Operations and Comprehensive Income (Predecessor). Deposits to and surrenders and withdrawals from the Separate Accounts are reflected in Separate Accounts liabilities and are not included in cash flows. | ||
Absent any contract provision wherein the Company provides a guarantee, variable annuity and variable life insurance contractholders bear the investment risk that the Separate Accounts’ funds may not meet their stated investment objectives. | ||
Future Policy Benefits and Other Policyholder Liabilities — Successor | ||
Policy liabilities are established for future policy benefits on certain annuity, life, and long term care policies. Such liabilities are established in amounts adequate to meet the estimated future obligations of policies in-force. Changes in policy and contract claims are recorded in policyholder benefits in the Consolidated Statement of Operations and Comprehensive Income (Loss). | ||
For ASC 944-20 products, benefit reserves are computed using the net level premium method for individual life and annuity policies, and are based upon estimates as to future investment yield, mortality and lapse that include provisions for adverse deviation. Mortality, morbidity and lapse assumptions for all policies are based on the Company’s own experience and industry standards. | ||
Liabilities for outstanding claims and claims adjustment expenses are estimates of payments to be made on life and health insurance contracts for reported claims and claims adjustment expenses. A liability is also held for claims adjustment expenses incurred but not reported as of the balance sheet date. These liabilities are determined using case basis evaluations and statistical analyses and represent estimates of the ultimate cost of all claims incurred but not paid. These estimates are continually reviewed and adjusted as necessary; such adjustments are reflected in current operations. | ||
Future policy benefit reserves for the portion of fixed indexed annuity policies with returns linked to the performance of a specified market index are equal to the sum of the fair value of the embedded derivatives and the host (or guaranteed) component of the contracts. The change in the fair value of the embedded derivative is linked to the performance of the equity option. The host value is established as of the date of acquisition and is equal to the account value for which returns are linked to an equity index, plus the value of the unexpired options at the date of acquisition, less the embedded derivative, and accreted over the policy’s life at a constant rate of interest. Future policy benefits reserves for the portion of fixed indexed annuities earning a fixed rate of interest, and other deferred annuity products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. | ||
The Company holds additional liabilities for its no lapse guarantees (associated with universal life) and guaranteed minimum withdrawal benefits (associated with fixed indexed annuities). These are accounted for in accordance with ASC 944-20,Financial Services — Insurance Activities. | ||
Policy liabilities and accruals are based on the various estimates discussed above. Although the adequacy of these amounts cannot be assured, the Company believes that policy liabilities and accruals will be sufficient to meet future obligations of policies in-force. The amount of liabilities and accruals, however, could be revised if the estimates discussed above are revised. | ||
Future Policy Benefit and Other Policyholder Liabilities – Predecessor | ||
Future policy benefit and other policyholder liabilities consist of the reserve for life-contingent contract benefits payable under insurance policies, including traditional life insurance and life-contingent immediate annuities, and is computed on the basis of long-term actuarial assumptions of future investment yields, mortality, morbidity, policy terminations and expenses. These assumptions, which for traditional life insurance are applied using the net level premium method, include provisions for adverse deviation and generally vary by characteristics such as type of coverage, year of issue and policy duration. | ||
Policyholders’ Account Balances — Successor | ||
Policyholder account balances represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Policyholder funds primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. | ||
The Company holds additional liabilities for guaranteed minimum income benefits (“GMIB”) associated with variable annuities, which are accounted for in accordance with ASC 944-20, Financial Services — Insurance Activities. The reserves for certain living benefit features, including guaranteed minimum accumulation benefits (“GMAB”) and guaranteed minimum withdrawal benefits (“GMWB”) are accounted for as embedded derivatives, with fair values calculated as the present value of expected future benefit payments to contractholders less the present value of assessed rider fees attributable to the embedded derivative feature. This methodology could result in either a liability or contra-liability balance, given changing capital market conditions and various actuarial assumptions. The Company’s GMIB, GMAB and GMWB reserves are ceded to external reinsurers. For additional information regarding the valuation of these optional living benefit features, see Note 10. | ||
Policyholders’ Account Balances — Predecessor | ||
Policyholder account balances represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Policyholder account balances primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. Policyholder account balances also include reserves for secondary guarantees on interest-sensitive life insurance and certain fixed annuity contracts and reserves for certain guarantees on variable annuity contracts. | ||
Income Taxes — Successor | ||
Income taxes are provided for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial statement and income tax bases of assets and liabilities. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The realizability of deferred tax assets is assessed at each reporting date. Tax positions are assessed under a two-step approach, which requires the assessment of recognition and measurement. The Company reports interest expense related to income tax matters and tax penalties in other operating expenses in the Consolidated Statement of Operations and Comprehensive Income (Loss). | ||
Income Taxes — Predecessor | ||
The income tax provision is calculated under the liability method. Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. The principal assets and liabilities giving rise to such differences are unrealized capital gains and losses, accrued expenses and reinsurance recoverables. A deferred tax asset valuation allowance is established when there is uncertainty that such assets will be realized. | ||
Other Long-Term Debt | ||
Effective April 1, 2014, and with Nebraska Department of Insurance (the “NE DOI” or the “Department of Insurance”) approval, Lancaster Re issued a variable funding Surplus Note (the “Surplus Note”) to its affiliate, Lanis, LLC. for $513,000,000 and acquired from Lanis a Vehicle Note (the “Vehicle Note”) for $513,000,000. The Vehicle Note is held to support a portion of Lancaster Re’s reinsurance obligations and has been authorized as an acceptable form of reinsurance collateral pursuant to Nebraska Rev. Stat. §44-8216(8)(c)(i) which allows a special purpose financial captive insurer to establish any method of security that the Department deems acceptable. The scheduled maturity date of the Vehicle Note is April 1, 2034, and the scheduled maturity date of the Surplus Note is April 1, 2039, although each may be cancelled earlier or extended under certain conditions. The Surplus Note does not repay principal prior to maturity and principal payment at maturity is subject to the prior approval of the Department of Insurance. With pre-approval, the Surplus Note is increased each quarter with a corresponding increase in the Vehicle Note. With Department pre-approval, interest on the Surplus Note for the prior quarter is paid on the first day of each subsequent quarter at a rate consistent with the rate received on the Vehicle Note of 4%. The Surplus Note and Vehicle Note increased by $38,600,000 and interest expense of $15,711,000 was recognized in the Successor Period from April 1, 2014 through December 31, 2014. The Surplus Note is unsecured and subordinated to all present and future indebtedness, policy claims and other creditor claims of Lancaster Re. | ||
Other Assets and Accrued Expenses and Other Liabilities | ||
Other assets consist primarily of premiums due, intangible assets, the Vehicle Note, receivables resulting from sales of securities that had not yet settled at the balance sheet date. Other liabilities consist primarily of accrued expenses, technical overdrafts, derivatives, and payables resulting from purchases of securities that had not yet been settled at the balance sheet date. | ||
Adoption of New Accounting Pronouncements | ||
In February 2013, the Financial Accounting Standards Board issued guidance requiring expanded disclosures about the amounts reclassified out of accumulated other comprehensive income by component. The guidance requires the presentation of significant amounts reclassified out of accumulated other comprehensive income by income statement line item but only if the amount reclassified is required under accounting principles generally accepted in the United States of America (“GAAP”) to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under GAAP to be reclassified in their entirety to net income, cross-reference to other disclosures that provide additional detail about those amounts is required. The Company adopted the new guidance in 2013. The new guidance affects disclosures only and therefore had no impact on the Company’s results of operations or financial position. | ||
Effective November 18, 2014, the Company adopted new guidance on when, if ever, the cost of acquiring an entity should be used to establish a new accounting basis (“pushdown”) in the acquired entity’s separate financial statements. The guidance provides an acquired entity and its subsidiaries with an irrevocable option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. If a reporting entity elects to apply pushdown accounting, its stand-alone financial statements would reflect the acquirer’s new basis in the acquired entity’s assets and liabilities. The election to apply pushdown accounting should be determined by an acquired entity for each individual change-in-control event in which an acquirer obtains control of the acquired entity; however, an entity that does not elect to apply pushdown accounting in the period of a change-in-control can later elect to retrospectively apply pushdown accounting to the most recent change-in-control transaction as a change in accounting principle. The Company has applied pushdown accounting as a result of the Acquisition in the Successor Period, as disclosed in Note 1. | ||
In February 2015, the FASB issued updated guidance regarding consolidation. The pronouncement eliminates specialized guidance for limited partnerships and similar legal entities, and removes the indefinite deferral for certain investment funds. The new guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, with early adoption permitted. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | ||
In January 2014, the FASB issued updated guidance regarding investments in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit. Under the guidance, an entity is permitted to make an accounting policy election to amortize the initial cost of its investment in proportion to the tax credits and other tax benefits received and recognize the net investment performance in the Statement of Operations and Comprehensive Income (Loss) as a component of Income tax expense (benefit) if certain conditions are met. The new guidance is effective for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2014, and should be applied retrospectively to all periods presented. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | ||
In January 2014, the FASB issued updated guidance for troubled debt restructurings clarifying when an in substance repossession or foreclosure occurs, and when a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014. This guidance can be elected for prospective adoption or by using a modified retrospective transition method. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | ||
In May 2014, the FASB issued updated guidance on accounting for revenue recognition. The guidance is based on the core principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The guidance also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from cost incurred to obtain or fulfill a contract. Revenue recognition for insurance contracts is explicitly scoped out of the guidance. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2016 and must be applied using one of two retrospective application methods. Early adoption is not permitted. The Company is currently assessing the impact of the guidance on the Company’s consolidated financial position, results of operations and financial statement disclosures. | ||
In August 2014, the FASB issued guidance requiring that mortgage loans be derecognized and that a separate other receivable be recognized upon foreclosure if certain conditions are met. Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014, with early adoption permitted. This guidance can be adopted using either a prospective transition method or a modified retrospective transition method. This guidance is not expected to have a significant impact on the Company’s consolidated financial position, results of operations or financial statement disclosures. |
Investments
Investments | 12 Months Ended | ||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||
Investments | 3 | Investments | |||||||||||||||||||||||||||
The amortized cost, gross unrealized gains and losses and fair value for fixed maturities as of December 31, 2014 and 2013 were as follows: | |||||||||||||||||||||||||||||
December 31, 2014 — Successor | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
($ in thousands) | Gains | Losses | |||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | 810,057 | $ | 47,859 | $ | (590 | ) | $ | 857,326 | ||||||||||||||||||||
Obligations of U.S. States and Political Subdivisions | 250,008 | 5,638 | (437 | ) | 255,209 | ||||||||||||||||||||||||
All other corporate securities | 7,279,391 | 132,480 | (34,126 | ) | 7,377,745 | ||||||||||||||||||||||||
ABS | 373,304 | 6,107 | (2,408 | ) | 377,003 | ||||||||||||||||||||||||
CMBS | 331,041 | 3,507 | (1,065 | ) | 333,483 | ||||||||||||||||||||||||
RMBS | 188,055 | 2,849 | (1,023 | ) | 189,881 | ||||||||||||||||||||||||
Total fixed maturities | $ | 9,231,856 | $ | 198,440 | $ | (39,649 | ) | $ | 9,390,647 | ||||||||||||||||||||
December 31, 2013 — Predecessor | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
($ in thousands) | Gains | Losses | |||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. government and agenciies | $ | 70,790 | $ | 3,113 | $ | (57 | ) | $ | 73,846 | ||||||||||||||||||||
Municipal | 2,499 | 270 | — | 2,769 | |||||||||||||||||||||||||
Corporate | 190,186 | 5,784 | (3,993 | ) | 191,977 | ||||||||||||||||||||||||
Foreign government | 4,999 | 165 | — | 5,164 | |||||||||||||||||||||||||
CMBS | 2,588 | 88 | — | 2,676 | |||||||||||||||||||||||||
RMBS | 13,866 | 584 | — | 14,450 | |||||||||||||||||||||||||
Total fixed maturities | $ | 284,928 | $ | 10,004 | $ | (4,050 | ) | $ | 290,882 | ||||||||||||||||||||
Scheduled Maturities — Successor | |||||||||||||||||||||||||||||
The scheduled maturities for fixed maturities are as follows as of December 31, 2014: | |||||||||||||||||||||||||||||
($ in thousands) | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | |||||||||||||||||||||||||||||
Due in one year or less | $ | 425,248 | $ | 425,238 | |||||||||||||||||||||||||
Due after one year through five years | 1,775,910 | 1,779,194 | |||||||||||||||||||||||||||
Due after five years through ten years | 4,001,723 | 4,060,017 | |||||||||||||||||||||||||||
Due after ten years | 2,136,575 | 2,225,831 | |||||||||||||||||||||||||||
Total before asset and mortgage-backed securities | 8,339,456 | 8,490,280 | |||||||||||||||||||||||||||
Asset and mortgage-backed securities | 892,400 | 900,367 | |||||||||||||||||||||||||||
Total fixed maturities | $ | 9,231,856 | $ | 9,390,647 | |||||||||||||||||||||||||
Actual maturities may differ from those scheduled as a result of calls and make-whole payments by the issuers. Asset and mortgage-backed securities are shown separately because of the potential for prepayment of principal prior to contractual maturity dates. | |||||||||||||||||||||||||||||
Commercial Mortgage Loans — Successor | |||||||||||||||||||||||||||||
The Company diversifies its commercial mortgage loan portfolio by geographical region to reduce concentration risk. The following table presents the Company’s commercial mortgage loan portfolio by geographical region as of December 31, 2014: | |||||||||||||||||||||||||||||
($ in thousands) | Carrying | ||||||||||||||||||||||||||||
Value | |||||||||||||||||||||||||||||
Alabama | $ | 1,720 | |||||||||||||||||||||||||||
Arizona | 35,481 | ||||||||||||||||||||||||||||
California | 255,563 | ||||||||||||||||||||||||||||
Colorado | 22,381 | ||||||||||||||||||||||||||||
Florida | 20,779 | ||||||||||||||||||||||||||||
Georgia | 27,502 | ||||||||||||||||||||||||||||
Hawaii | 8,125 | ||||||||||||||||||||||||||||
Illinois | 53,174 | ||||||||||||||||||||||||||||
Iowa | 1,490 | ||||||||||||||||||||||||||||
Kentucky | 8,260 | ||||||||||||||||||||||||||||
Maine | 4,114 | ||||||||||||||||||||||||||||
Maryland | 35,536 | ||||||||||||||||||||||||||||
Massachusetts | 92,963 | ||||||||||||||||||||||||||||
Minnesota | 52,496 | ||||||||||||||||||||||||||||
Missouri | 9,324 | ||||||||||||||||||||||||||||
Nevada | 14,705 | ||||||||||||||||||||||||||||
New Jersey | 84,007 | ||||||||||||||||||||||||||||
New York | 72,625 | ||||||||||||||||||||||||||||
North Carolina | 31,111 | ||||||||||||||||||||||||||||
Ohio | 38,400 | ||||||||||||||||||||||||||||
Oklahoma | 10,835 | ||||||||||||||||||||||||||||
Pennsylvania | 37,688 | ||||||||||||||||||||||||||||
South Carolina | 3,130 | ||||||||||||||||||||||||||||
Tennessee | 5,719 | ||||||||||||||||||||||||||||
Texas | 103,778 | ||||||||||||||||||||||||||||
Utah | 45,914 | ||||||||||||||||||||||||||||
Virginia | 18,572 | ||||||||||||||||||||||||||||
Washington | 13,138 | ||||||||||||||||||||||||||||
Wisconsin | 6,637 | ||||||||||||||||||||||||||||
General allowance for loan loss | — | ||||||||||||||||||||||||||||
Total commercial mortgage loans | $ | 1,115,167 | |||||||||||||||||||||||||||
Credit Quality of Commercial Mortgage Loans | |||||||||||||||||||||||||||||
The credit quality of commercial mortgage loans held-for-investment were as follows at December 31, 2014: | |||||||||||||||||||||||||||||
Recorded Investment | |||||||||||||||||||||||||||||
Debt Service Coverage Ratios | |||||||||||||||||||||||||||||
($ in thousands) | > 1.20x | 1.00x - 1.20x | < 1.00x | Total | % of Total | Estimated Fair | % of Total | ||||||||||||||||||||||
Value | |||||||||||||||||||||||||||||
Loan-to-value ratios: | |||||||||||||||||||||||||||||
Less than 65% | $ | 930,592 | $ | 151,700 | $ | 29,460 | $ | 1,111,752 | 98 | % | $ | 1,146,030 | 98 | % | |||||||||||||||
65% to 75% | 16,591 | 10,537 | — | 27,128 | 2 | 28,275 | 2 | ||||||||||||||||||||||
76% to 80% | — | — | — | — | — | — | — | ||||||||||||||||||||||
Greater than 80% | — | — | — | — | — | — | — | ||||||||||||||||||||||
Total | $ | 947,183 | $ | 162,237 | $ | 29,460 | $ | 1,138,880 | 100 | % | $ | 1,174,305 | 100 | % | |||||||||||||||
As of December 31, 2014, the Company had no allowance for credit losses for commercial mortgage loans. As of December 31, 2014, $1,139 million of commercial mortgage loans were in current status and no commercial mortgage and other loans were classified as past due. The Company defines current in its aging of past due commercial mortgage and other loans as less than 30 days past due. | |||||||||||||||||||||||||||||
Impaired loans include those loans for which it is probable that all amounts due will not be collected according to the contractual terms of the loan agreement. As of December 31, 2014, the Company held no impaired commercial mortgage loans. | |||||||||||||||||||||||||||||
The Company’s commercial mortgage and other loans may occasionally be involved in a troubled debt restructuring. As of December 31, 2014, the Company had no significant commitments to fund borrowers that have been involved in a troubled debt restructuring. For the period from April 1, 2014 through December 31, 2014, there were no new troubled debt restructurings related to commercial mortgage and other loans, and no payment defaults on commercial mortgages. | |||||||||||||||||||||||||||||
Other Invested Assets — Successor | |||||||||||||||||||||||||||||
The following table sets forth the composition of “Other invested assets” at December 31, 2014: | |||||||||||||||||||||||||||||
Successor | |||||||||||||||||||||||||||||
($ in thousands) | December 31, 2014 | ||||||||||||||||||||||||||||
Low income housing tax credit properties | $ | 896 | |||||||||||||||||||||||||||
Derivatives | 26,001 | ||||||||||||||||||||||||||||
$ | 26,897 | ||||||||||||||||||||||||||||
Net Investment Income | |||||||||||||||||||||||||||||
Net investment income for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the Period | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | from January 1, | Ended | Ended | ||||||||||||||||||||||||||
through | 2014 | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | through March 31, | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | 2014 | ||||||||||||||||||||||||||||
Fixed maturities | $ | 231,972 | $ | 2,461 | $ | 11,545 | $ | 12,138 | |||||||||||||||||||||
Commercial mortgage loans | 49,417 | — | — | — | |||||||||||||||||||||||||
Cash and short-term investments | 4,786 | 16 | 23 | 20 | |||||||||||||||||||||||||
Other investment (loss) income | 7,353 | — | — | — | |||||||||||||||||||||||||
Gross investment income | 293,528 | 2,477 | 11,568 | 12,158 | |||||||||||||||||||||||||
Investment expenses | 4,957 | 127 | 633 | 568 | |||||||||||||||||||||||||
Net investment income | $ | 288,571 | $ | 2,350 | $ | 10,935 | $ | 11,590 | |||||||||||||||||||||
Realized Investment Gains and Losses | |||||||||||||||||||||||||||||
Realized investment gains and losses for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the Period | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | from January 1, | Ended | Ended | ||||||||||||||||||||||||||
through | 2014 | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | through March 31, | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | 2014 | ||||||||||||||||||||||||||||
Realized investment gains, net | |||||||||||||||||||||||||||||
Fixed maturities | $ | 25,795 | $ | 285 | $ | — | $ | 626 | |||||||||||||||||||||
Commercial mortgage loans | 2,880 | — | — | — | |||||||||||||||||||||||||
Derivatives | 17,417 | — | — | — | |||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||
Net realized gains | $ | 46,092 | $ | 285 | $ | — | $ | 626 | |||||||||||||||||||||
There were no other-than-temporary impairment losses recorded in the Successor Period from April 1, 2014 through December 31, 2014. | |||||||||||||||||||||||||||||
There were no other-than-temporary impairment losses recorded in the Predecessor Period from January 1, 2014 through March 31, 2014. Realized capital gains and losses in the Predecessor years ended December 31, 2013 and 2012 included $2 thousand and $19 thousand, respectively, of other-than-temporary impairment losses related to RMBS, none of which were included in other comprehensive income. No other-than-temporary impairment losses were included in accumulated other comprehensive income as of December 31, 2014 and 2013. | |||||||||||||||||||||||||||||
Proceeds from sales of fixed maturities and gross realized investment gains and losses for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | |||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | Period from | Ended | Ended | ||||||||||||||||||||||||||
through | January 1, | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | 2014 | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | through | ||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||
Fixed maturities, available-for-sale | |||||||||||||||||||||||||||||
Proceeds from sales | $ | 1,429,177 | $ | 5,277 | $ | 9,170 | $ | 25,367 | |||||||||||||||||||||
Gross investment gains from sales | 30,403 | 317 | 3 | 645 | |||||||||||||||||||||||||
Gross investment losses from sales | (4,608 | ) | (32 | ) | (1 | ) | — | ||||||||||||||||||||||
Unrealized Investment Gains and Losses | |||||||||||||||||||||||||||||
The following table summarizes the gross unrealized losses and fair value of fixed maturities by the length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2014 and 2013: | |||||||||||||||||||||||||||||
Successor | Less than 12 months | Greater than 12 months | |||||||||||||||||||||||||||
December 31, 2014 | Fair Value | Gross | Fair | Gross | Fair Value | Gross | |||||||||||||||||||||||
Unrealized | Value | Unrealized | Unrealized | ||||||||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | 71,766 | $ | (590 | ) | $ | — | $ | — | $ | 71,766 | $ | (590 | ) | |||||||||||||||
Obligations of U.S. States and Political Subdivisions | 37,543 | (437 | ) | — | — | 37,543 | (437 | ) | |||||||||||||||||||||
All other corporate securities | 1,683,185 | (34,126 | ) | — | — | 1,683,185 | (34,126 | ) | |||||||||||||||||||||
ABS | 115,568 | (2,408 | ) | — | — | 115,568 | (2,408 | ) | |||||||||||||||||||||
CMBS | 135,203 | (1,065 | ) | — | — | 135,203 | (1,065 | ) | |||||||||||||||||||||
RMBS | 92,804 | (1,023 | ) | — | — | 92,804 | (1,023 | ) | |||||||||||||||||||||
Total fixed income securities | $ | 2,136,069 | $ | (39,649 | ) | $ | — | $ | — | $ | 2,136,069 | $ | (39,649 | ) | |||||||||||||||
Predecessor | Less than 12 months | Greater than 12 months | |||||||||||||||||||||||||||
December 31, 2013 | Fair Value | Gross | Fair | Gross | Fair Value | Gross | |||||||||||||||||||||||
Unrealized | Value | Unrealized | Unrealized | ||||||||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. government agencies | $ | 4,942 | $ | (57 | ) | $ | — | $ | — | $ | 4,942 | $ | (57 | ) | |||||||||||||||
Corporate | 75,754 | (3,795 | ) | 1,770 | (198 | ) | 77,524 | (3,993 | ) | ||||||||||||||||||||
Total fixed income securities | $ | 80,696 | $ | (3,852 | ) | $ | 1,770 | $ | (198 | ) | $ | 82,466 | $ | (4,050 | ) | ||||||||||||||
Portfolio Monitoring | |||||||||||||||||||||||||||||
The Company has a comprehensive portfolio monitoring process to identify and evaluate each fixed maturity security whose carrying value may be other-than-temporarily impaired. | |||||||||||||||||||||||||||||
For each fixed maturity security in an unrealized loss position, the Company assesses whether management with the appropriate authority has made the decision to sell or whether it is more likely than not the Company will be required to sell the security before recovery of the amortized cost basis for reasons such as liquidity, contractual or regulatory purposes. If a security meets either of these criteria, the security’s decline in fair value is considered other than temporary and is recorded in earnings. | |||||||||||||||||||||||||||||
If the Company has not made the decision to sell the fixed maturity security and it is not more likely than not the Company will be required to sell the fixed maturity security before recovery of its amortized cost basis, the Company evaluates whether it expects to receive cash flows sufficient to recover the entire amortized cost basis of the security. The Company calculates the estimated recovery value by discounting the best estimate of future cash flows at the security’s original or current effective rate, as appropriate, and compares this to the amortized cost of the security. If the Company does not expect to receive cash flows sufficient to recover the entire amortized cost basis of the fixed maturity security, the credit loss component of the impairment is recorded in earnings, with the remaining amount of the unrealized loss related to other factors recognized in other comprehensive income. | |||||||||||||||||||||||||||||
The Company’s portfolio monitoring process includes a quarterly review of all securities to identify instances where the fair value of a security compared to its amortized cost is below established thresholds. The process also includes the monitoring of other impairment indicators such as ratings, ratings downgrades and payment defaults. The securities identified, in addition to other securities for which the Company may have a concern, are evaluated for potential other-than-temporary impairment using all reasonably available information relevant to the collectability or recovery of the security. Inherent in the Company’s evaluation of other-than-temporary impairment for these fixed maturity securities are assumptions and estimates about the financial condition and future earnings potential of the issue or issuer. Some of the factors that may be considered in evaluating whether a decline in fair value is other than temporary are: 1) the financial condition, near-term and long-term prospects of the issue or issuer, including relevant industry specific market conditions and trends, geographic location and implications of rating agency actions and offering prices; 2) the specific reasons that a security is in an unrealized loss position, including overall market conditions which could affect liquidity; and 3) the length of time and extent to which the fair value has been less than amortized cost. | |||||||||||||||||||||||||||||
Net Unrealized Investment Gains and Losses in Accumulated Other Comprehensive Income | |||||||||||||||||||||||||||||
($ in thousands) | Net Unrealized | VOBA | Future Policy | Deferred | Accumulated Other | ||||||||||||||||||||||||
Gain (Losses) on | Benefits and | Income Tax | Comprehensive | ||||||||||||||||||||||||||
Investments | Policyholders’ | (Liability) | Income (Loss) | ||||||||||||||||||||||||||
Account Balances | Asset | Related to Net | |||||||||||||||||||||||||||
Predecessor | Unrealized | ||||||||||||||||||||||||||||
Investment Gains | |||||||||||||||||||||||||||||
(Losses) | |||||||||||||||||||||||||||||
Balance, December 31, 2011 | $ | 20,855 | $ | — | $ | — | $ | (7,299 | ) | $ | 13,556 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | 977 | — | — | (343 | ) | 634 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 596 | — | — | (209 | ) | 387 | |||||||||||||||||||||||
Balance, December 31, 2012 | $ | 21,236 | $ | — | $ | — | $ | (7,433 | ) | $ | 13,803 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | (15,281 | ) | — | — | 5,349 | (9,932 | ) | ||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 1 | — | — | — | 1 | ||||||||||||||||||||||||
Balance, December 31, 2013 | $ | 5,954 | $ | — | $ | — | $ | (2,084 | ) | $ | 3,870 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | 2,364 | — | — | (828 | ) | 1,536 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 285 | — | — | (100 | ) | 185 | |||||||||||||||||||||||
Balance, March 31, 2014 | $ | 8,033 | $ | — | $ | — | $ | (2,812 | ) | $ | 5,221 | ||||||||||||||||||
Successor | |||||||||||||||||||||||||||||
Balance, April 1, 2014 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Net investment gains and losses on investments arising during the period | 159,261 | — | — | (55,674 | ) | 103,587 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | — | — | — | — | — | ||||||||||||||||||||||||
Impact of net unrealized investment gains and losses on VOBA | — | (20,287 | ) | — | 7,100 | (13,187 | ) | ||||||||||||||||||||||
Impact of net unrealized investment gains and losses on future policy benefits and policyholders’ account balances | — | — | (7,541 | ) | 2,639 | (4,902 | ) | ||||||||||||||||||||||
Balance, December 31, 2014 | $ | 159,261 | $ | (20,287 | ) | $ | (7,541 | ) | $ | (45,935 | ) | $ | 85,498 | ||||||||||||||||
Derivative_Financial_Instrumen
Derivative Financial Instruments | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Derivative Financial Instruments | 4 | Derivative Financial Instruments | |||||||||||||||||||||||
See Note 2 for a description of the Company’s accounting policies for derivatives and Note 5 for information about the fair value hierarchy for derivatives. | |||||||||||||||||||||||||
The following table provides a summary of the notional and fair value positions of derivative financial instruments as of December 31, 2014 and 2013: | |||||||||||||||||||||||||
($ in thousands) | Succesor | ||||||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||||||
Gross Fair Value | |||||||||||||||||||||||||
Primary Underlying | Notional | Assets | Liabilities | ||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Equity options | $ | 624 | $ | 68,776 | $ | (43,104 | ) | ||||||||||||||||||
Futures | 10 | 329 | — | ||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | |||||||||||||||||||||||||
Equity-indexed annuity contracts(3) | $ | 1,734,264 | $ | — | $ | (63,660 | ) | ||||||||||||||||||
Equity-indexed life contracts(3) | 347,610 | — | (18,720 | ) | |||||||||||||||||||||
Guaranteed accumulation benefits(1) | 120,714 | — | (6,367 | ) | |||||||||||||||||||||
Guaranteed withdrawal benefits(1) | 17,102 | — | (366 | ) | |||||||||||||||||||||
($ in thousands) | Predecessor | ||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
Gross Fair Value | |||||||||||||||||||||||||
Primary Underlying | Notional | Assets | Liabilities | ||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | |||||||||||||||||||||||||
Equity-indexed and forward starting options in life and annuity product contracts(2) | 2,591,090 | — | (258,415 | ) | |||||||||||||||||||||
Guaranteed accumulation benefits(2) | 152,936 | — | (8,970 | ) | |||||||||||||||||||||
Guaranteed withdrawal benefits(2) | 22,199 | — | (474 | ) | |||||||||||||||||||||
-1 | As of April 1, 2014, these amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||
-2 | Prior to April 1, 2014, these amounts were ceded to ALIC or in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||
-3 | Amount represents account value of equity indexed contracts. | ||||||||||||||||||||||||
The standardized ISDA Master Agreement under which the Company’s derivative transactions includes provisions for payment netting. In the normal course of business activities, if there is more than one derivative transaction with a single counterparty, the Company will set-off the cash flows of those derivatives into a single amount to be exchanged in settlement of the resulting net payable or receivable with that counterparty. The Company nets the fair value of all derivative financial instruments with counterparties for which an ISDA Master Agreement and related CSA have been executed. At December 31, 2014, the Company held $6.4 million in cash and securities collateral delivered by trade counterparties. This unrestricted cash collateral is reported in Cash on the Consolidated Balance Sheet. | |||||||||||||||||||||||||
The following table presents the amount and location of gains (losses) recognized in income, net of reinsurance, for derivatives that were not designated or qualifying as hedging instruments for the Successor Period from April 1, 2014 through December 31, 2014: | |||||||||||||||||||||||||
Successor | |||||||||||||||||||||||||
($ in thousands) | For the Period from April 1, 2014 | ||||||||||||||||||||||||
through December 31, 2014 | |||||||||||||||||||||||||
Realized | Policyholder | ||||||||||||||||||||||||
Investment Gains | Benefits | ||||||||||||||||||||||||
(Losses) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Equity Options | $ | 15,230 | $ | — | |||||||||||||||||||||
Futures | $ | 2,187 | $ | — | |||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||
Equity-indexed annuity contracts | $ | — | $ | (5,622 | ) | ||||||||||||||||||||
Equity-indexed life contracts | 90 | ||||||||||||||||||||||||
The following table presents the amount and location of gains (losses) recognized in income for derivatives that were not designated or qualifying as hedging instruments for the Predecessor Periods from January 1, 2014 through March 31, 2014 and for the years ended December 31, 2013 and December 31, 2013: | |||||||||||||||||||||||||
($ in thousands) | Predecessor | ||||||||||||||||||||||||
For the Period from January 1, | For the Year Ended | For the Year Ended | |||||||||||||||||||||||
2014 through March 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||
Interest Credited(1) | Policyholder | Interest | Policyholder | Interest | Policyholder | ||||||||||||||||||||
Benefits (1) | Credited(1) | Benefits (1) | Credited(1) | Benefits (1) | |||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | 16,427 | $ | 946 | $ | 36,890 | $ | 10,177 | $ | 186,625 | $ | 5,126 | |||||||||||||
-1 | Prior to April 1, 2014, these amounts were ceded in accordance with the Company’s reinsurance agreements. |
Fair_Value
Fair Value | 12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||||||||||
Fair Value | 5 | Fair Value | |||||||||||||||||||||||||||||||||||||||
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Assets and liabilities recorded on the Consolidated Balance Sheet (Successor) and Balance Sheet (Predecessor) at fair value are categorized in the fair value hierarchy based on the observability of inputs to the valuation techniques as follows: | |||||||||||||||||||||||||||||||||||||||||
Level 1 | Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that the Company can access. | ||||||||||||||||||||||||||||||||||||||||
Level 2 | Assets and liabilities whose values are based on the following: | ||||||||||||||||||||||||||||||||||||||||
(a) Quoted prices for similar assets or liabilities in active markets; | |||||||||||||||||||||||||||||||||||||||||
(b) Quoted prices for identical or similar assets or liabilities in markets that are not active; or | |||||||||||||||||||||||||||||||||||||||||
(c) Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. | |||||||||||||||||||||||||||||||||||||||||
Level 3 | Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs reflect the Company’s estimates of the assumptions that market participants would use in valuing the assets and liabilities. | ||||||||||||||||||||||||||||||||||||||||
The availability of observable inputs varies by instrument. In situations where fair value is based on internally developed pricing models or inputs that are unobservable in the market, the determination of fair value requires more judgment. The degree of judgment exercised by the Company in determining fair value is typically greatest for instruments categorized in Level 3. In many instances, valuation inputs used to measure fair value fall into different levels of the fair value hierarchy. The category level in the fair value hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety. The Company uses prices and inputs that are current as of the measurement date, including during periods of market disruption. In periods of market disruption, the ability to observe prices and inputs may be reduced for many instruments. | |||||||||||||||||||||||||||||||||||||||||
The Company is responsible for the determination of fair value and the supporting assumptions and methodologies. The Company gains assurance that assets and liabilities are appropriately valued through the execution of various processes and controls designed to ensure the overall reasonableness and consistent application of valuation methodologies, including inputs and assumptions, and compliance with accounting standards. For fair values received from third parties or internally estimated, the Company’s processes and controls are designed to ensure that the valuation methodologies are appropriate and consistently applied, the inputs and assumptions are reasonable and consistent with the objective of determining fair value, and the fair values are accurately recorded. For example, on a continuing basis, the Company assesses the reasonableness of individual fair values that have stale security prices or that exceed certain thresholds as compared to previous fair values received from valuation service providers or brokers or derived from internal models. The Company performs procedures to understand and assess the methodologies, processes and controls of valuation service providers. In addition, the Company may validate the reasonableness of fair values by comparing information obtained from valuation service providers or brokers to other third party valuation sources for selected securities. The Company performs ongoing price validation procedures such as back-testing of actual sales, which corroborate the various inputs used in internal models to market observable data. When fair value determinations are expected to be more variable, the Company validates them through reviews by members of management who have relevant expertise and who are independent of those charged with executing investment transactions. | |||||||||||||||||||||||||||||||||||||||||
Successor | |||||||||||||||||||||||||||||||||||||||||
The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2014. There are no assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2014. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||||||||||||||
Description for Each Class of Asset or Liability | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||
Assets at fair value | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||||||||||||||
U.S Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | — | $ | 857,326 | $ | — | $ | 857,326 | |||||||||||||||||||||||||||||||||
Obligations of U.S. States and Political Subdivisions | — | 255,209 | — | 255,209 | |||||||||||||||||||||||||||||||||||||
All Other Corporate Securities | — | 7,370,409 | 7,336 | 7,377,745 | |||||||||||||||||||||||||||||||||||||
ABS | — | 371,753 | 5,250 | 377,003 | |||||||||||||||||||||||||||||||||||||
CMBS | — | 330,790 | 2,693 | 333,483 | |||||||||||||||||||||||||||||||||||||
RMBS | — | 189,881 | — | 189,881 | |||||||||||||||||||||||||||||||||||||
Short term investments | 191,979 | 145,676 | 23,713 | 361,368 | |||||||||||||||||||||||||||||||||||||
Other invested assets | |||||||||||||||||||||||||||||||||||||||||
Equity Options | 25,672 | — | — | 25,672 | |||||||||||||||||||||||||||||||||||||
Futures | 329 | — | — | 329 | |||||||||||||||||||||||||||||||||||||
Separate accounts assets | 1,573,865 | — | — | 1,573,865 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 1,791,845 | $ | 9,521,044 | $ | 38,992 | $ | 11,351,881 | |||||||||||||||||||||||||||||||||
Liabilities at fair value | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | — | $ | — | $ | (63,660 | ) | $ | (63,660 | ) | |||||||||||||||||||||||||||||||
Equity indexed life contracts | — | (18,720 | ) | — | (18,720 | ) | |||||||||||||||||||||||||||||||||||
Guaranteed minimum accumulation benefits | — | — | (6,367 | ) | (6,367 | ) | |||||||||||||||||||||||||||||||||||
Guaranteed minimum withdrawal benefits | (366 | ) | (366 | ) | |||||||||||||||||||||||||||||||||||||
Separate accounts liabilities | (1,573,865 | ) | — | — | (1,573,865 | ) | |||||||||||||||||||||||||||||||||||
Total liabilites at fair value | $ | (1,573,865 | ) | $ | (18,720 | ) | $ | (70,393 | ) | $ | (1,662,978 | ) | |||||||||||||||||||||||||||||
There were no transfers between Level 1 and Level 2 from the period from April 1, 2014 through December 31, 2014. | |||||||||||||||||||||||||||||||||||||||||
Summary of significant valuation techniques for assets and liabilities measured at fair value on a recurring basis | |||||||||||||||||||||||||||||||||||||||||
Fixed Maturities | |||||||||||||||||||||||||||||||||||||||||
The fair values of the Company’s public fixed maturity securities are generally based on prices obtained from independent pricing services. Prices for each security are generally sourced from multiple pricing vendors, and a vendor hierarchy is maintained by asset type based on historical pricing experience and vendor expertise. The Company ultimately uses the price from the pricing service highest in the vendor hierarchy based on the respective asset type. The pricing hierarchy is updated for new financial products and recent pricing experience with various vendors. Consistent with the fair value hierarchy described above, securities with validated quotes from pricing services are generally reflected within Level 2, as they are primarily based on observable pricing for similar assets and/or other market observable inputs. Typical inputs used by these pricing services include but are not limited to reported trades, benchmark yields, issuer spreads, bids, offers, and/or estimated cash flow, prepayment speeds, and default rates. If the pricing information received from third party pricing services is deemed not reflective of market activity or other inputs observable in the market, the Company may challenge the price through a formal process with the pricing service or classify the securities as Level 3. If the pricing service updates the price to be more consistent with the presented market observations, the security remains within Level 2. | |||||||||||||||||||||||||||||||||||||||||
Indicative broker quotes are also used to determine fair value in circumstances where vendor pricing is not available, or where the Company ultimately concludes that pricing information received from independent pricing services is not reflective of market activity. If the Company concludes the values from both pricing services and brokers are not reflective of market activity, it may override the information with an internally-developed valuation. Pricing service overrides, internally-developed valuations and indicative broker quotes are generally included in Level 3 in the fair value hierarchy. | |||||||||||||||||||||||||||||||||||||||||
The fair value of private fixed maturities, which are comprised of investments in private placement securities are primarily determined using discounted cash flow models. These models primarily use observable inputs that include Treasury or similar base rates plus estimated credit spreads to value each security. The credit spreads are obtained through a survey of private market intermediaries who are active in both primary and secondary transactions, and consider, among other factors, the credit quality and industry sector of the issuer and the reduced liquidity associated with private placements. Since most private placements are valued using standard market observable inputs and inputs derived from, or corroborated by, market observable data including observed prices and spreads for similar publicly traded or privately traded issues, they have been reflected within Level 2. For certain private fixed maturities, the discounted cash flow model may incorporate significant unobservable inputs, which reflect the Company’s own assumptions about the inputs that market participants would use in pricing the asset. To the extent management determines that such unobservable inputs are significant to the price of a security, a Level 3 classification is made. No private placement securities were classified as Level 3 as of December 31, 2014. | |||||||||||||||||||||||||||||||||||||||||
Short-term Investments | |||||||||||||||||||||||||||||||||||||||||
Short-term investments include money market instruments, highly liquid debt instruments and certain other investments. Certain money market instruments are valued using unadjusted quoted prices in active markets that are accessible for identical assets and are primarily classified as Level 1. The remaining instruments in this category are generally fair valued based on market observable inputs and these investments have primarily been classified within Level 2. Short-term investments classified within Level 3 primarily consist of commercial mortgage loans. The fair value of commercial mortgage loans is equal to unpaid principal. | |||||||||||||||||||||||||||||||||||||||||
Other Invested Assets | |||||||||||||||||||||||||||||||||||||||||
The estimated fair value of derivatives is determined through the use of quoted market prices for exchange-traded derivatives. | |||||||||||||||||||||||||||||||||||||||||
Separate Account Assets and Liabilities | |||||||||||||||||||||||||||||||||||||||||
Separate account assets and liabilities consist principally of investments in mutual fund shares. The fair values are based on quoted market prices in active markets for identical assets and are classified within Level 1 in the fair value hierarchy. | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ Account Balances | |||||||||||||||||||||||||||||||||||||||||
The liabilities for guarantees primarily associated with the optional living benefit features of certain variable annuity contracts and equity indexed life and annuity contracts are calculated as the present value of future expected benefit payments to contractholders less the present value of assessed rider fees attributable to the optional living benefit feature. This methodology could result in either a liability or contra-liability balance, given changing capital market conditions and various actuarial assumptions. Since there is no observable active market for the transfer of these obligations, the valuations are calculated using internally developed models with option pricing techniques. The models are based on a risk neutral valuation framework and incorporate premiums for risks inherent in valuation techniques, inputs, and the general uncertainty around the timing and amount of future cash flows. The determination of these risk premiums requires the use of management judgment. | |||||||||||||||||||||||||||||||||||||||||
The significant inputs to the valuation models for these embedded derivatives include capital market assumptions, such as interest rate levels and volatility assumptions, as well as actuarially determined assumptions, including contractholder behavior, such as lapse rates, benefit utilization rates, withdrawal rates, and mortality rates. Since many of these assumptions are unobservable and are considered to be significant inputs to the liability valuation, the liability included in future policy benefits has been reflected within Level 3 in the fair value hierarchy. | |||||||||||||||||||||||||||||||||||||||||
Actuarial assumptions, including contractholder behavior and mortality, are reviewed at least annually, and updated based upon emerging experience, future expectations and other data, including any observable market data. These assumptions are generally updated annually unless a material change that the Company feels is indicative of a long term trend is observed in an interim period. | |||||||||||||||||||||||||||||||||||||||||
Level 3 Fair Value Measurements | |||||||||||||||||||||||||||||||||||||||||
The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Fair | Valuation | Unobservable | Range | Weighted | ||||||||||||||||||||||||||||||||||||
Value | Technique | Input | Average | ||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | (63,660 | ) | Option Pricing Technique | Projected option cost | 1.40% - 1.93% | 1.50% | ||||||||||||||||||||||||||||||||||
Excluded from the table above at December 31, 2014 are approximately $15 million of Level 3 fair value measurements of investments for which the underlying quantitative inputs are not developed by the Company and are not reasonably available. These investments primarily consist of certain public debt securities with limited trading activity, including asset-backed instruments, and their fair values generally reflect unadjusted prices obtained from independent valuation service providers and indicative, non-binding quotes obtained from third-party broker-dealers recognized as market participants. Significant increases or decreases in the fair value amounts received from these pricing sources may result in the Company’s reporting significantly higher or lower fair value measurements for these Level 3 investments. | |||||||||||||||||||||||||||||||||||||||||
The table above also excludes underlying quantitative inputs related to liabilities held for the Company’s guaranteed minimum accumulation benefits and guaranteed withdrawal benefits. These liabilities are not developed by the Company as they are 100% ceded to external reinsurers. The development of these liabilities generally involve actuarially determined models and could result in the Company reporting significantly higher or lower fair value measurements for these Level 3 investments. | |||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis from the period from April 1, 2014 through December 31, 2014: | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Balance | Net | OCI | Transfers | Transfers | Purchases | Sales | Issues | Settlements | Balance, | |||||||||||||||||||||||||||||||
as of | income | to Level 3 | out of | December 31, | |||||||||||||||||||||||||||||||||||||
April 1, | (loss) | Level 3 | 2014 | ||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||||||||||||||
All other corporate securities | $ | 400,527 | $ | 6,693 | $ | (7,841 | ) | $ | — | $ | (291,802 | ) | $ | 4,930 | $ | (97,228 | ) | $ | — | $ | — | $ | 15,279 | ||||||||||||||||||
Short-term investments | $ | 24,095 | $ | 29 | $ | — | $ | — | $ | — | $ | — | $ | (411 | ) | $ | — | $ | — | $ | 23,713 | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | (58,038 | ) | $ | (5,622 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (63,660 | ) | ||||||||||||||||||
Equity indexed life contracts | $ | (15,691 | ) | $ | (3,029 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (18,720 | ) | ||||||||||||||||||
Guaranteed minimium accumulation benefits and guaranteed minimum withdrawal benefits(1) | $ | (8,499 | ) | $ | 1,766 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (6,733 | ) | |||||||||||||||||||
-1 | These amount are 100% ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
Transfers into Level 3 are generally the result of unobservable inputs utilized within the valuation methodologies and the use of indicative broker quotes for assets that were previously valued using observable inputs. Transfers out of Level 3 are generally due to the use of observable inputs in valuation methodologies as well as the availability of pricing service information for certain assets that the Company is able to validate. | |||||||||||||||||||||||||||||||||||||||||
The following table presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Company’s Consolidated Balance Sheet; however, in some cases, as described below, the carrying amount equals or approximates fair value as of December 31, 2014. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||||||||||||||
Description for Each Class of Asset or Liability | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Commercial mortgage loans | $ | — | $ | — | $ | 1,150,510 | $ | 1,150,510 | |||||||||||||||||||||||||||||||||
Policy loans | — | — | 194,385 | 194,385 | |||||||||||||||||||||||||||||||||||||
Cash | 49,730 | — | — | 49,730 | |||||||||||||||||||||||||||||||||||||
Vehicle note | — | — | 551,600 | 551,600 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 49,730 | $ | — | $ | 1,896,495 | $ | 1,946,225 | |||||||||||||||||||||||||||||||||
Liabilities at fair value | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances — investment contracts | $ | — | $ | — | $ | 6,609,253 | $ | 6,609,253 | |||||||||||||||||||||||||||||||||
Other long-term debt | — | — | 551,600 | 551,600 | |||||||||||||||||||||||||||||||||||||
$ | — | $ | — | $ | 7,160,853 | $ | 7,160,853 | ||||||||||||||||||||||||||||||||||
The fair values presented above have been determined by using available market information and by applying market valuation methodologies, as described in more detail below. | |||||||||||||||||||||||||||||||||||||||||
Commercial Mortgage Loans | |||||||||||||||||||||||||||||||||||||||||
The fair value of most commercial mortgage loans is based upon the present value of the expected future cash flows discounted at the appropriate U.S. Treasury rate plus an appropriate credit spread for similar quality loans. | |||||||||||||||||||||||||||||||||||||||||
Policy Loans | |||||||||||||||||||||||||||||||||||||||||
The fair value of policy loans was determined by discounting expected cash flows at the current loan coupon rate. As a result, the carrying value of the policy loans approximates the fair value. | |||||||||||||||||||||||||||||||||||||||||
Cash | |||||||||||||||||||||||||||||||||||||||||
The Company believes that due to the short-term nature of certain assets, the carrying value approximates fair value. | |||||||||||||||||||||||||||||||||||||||||
Vehicle Note and Other Long-Term Debt | |||||||||||||||||||||||||||||||||||||||||
The carrying value of the Vehicle Note and Other long-term debt approximates fair value. | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ Account Balances — Investment Contracts | |||||||||||||||||||||||||||||||||||||||||
Only the portion of policyholders’ account balances related to products that are investment contracts (those without significant mortality or morbidity risk) are reflected in the table above. For fixed deferred annuities fair values are derived using discounted projected cash flows based on interest rates that are representative of the Company’s financial strength ratings, and hence reflect the Company’s own nonperformance risk. For those balances that can be withdrawn by the customer at any time without prior notice or penalty, the fair value is the amount estimated to be payable to the customer as of the reporting date, which is generally the carrying value. | |||||||||||||||||||||||||||||||||||||||||
Predecessor | |||||||||||||||||||||||||||||||||||||||||
Summary of significant valuation techniques for assets and liabilities measured at fair value on a recurring basis | |||||||||||||||||||||||||||||||||||||||||
Level 1 Measurements | |||||||||||||||||||||||||||||||||||||||||
• | Fixed maturities: Comprise certain U.S. Treasuries. Valuation is based on unadjusted quoted prices for identical assets in active markets that the Company can access. | ||||||||||||||||||||||||||||||||||||||||
• | Short-term: Comprise actively traded money market funds that have daily quoted net asset values for identical assets that the Company can access. | ||||||||||||||||||||||||||||||||||||||||
• | Separate account assets: Comprise actively traded mutual funds that have daily quoted net asset values for identical assets that the Company can access. Net asset values for the actively traded mutual funds in which the separate account assets are invested are obtained daily from the fund managers. | ||||||||||||||||||||||||||||||||||||||||
Level 2 Measurements | |||||||||||||||||||||||||||||||||||||||||
• | Fixed maturities | ||||||||||||||||||||||||||||||||||||||||
U.S. government and agencies: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. | |||||||||||||||||||||||||||||||||||||||||
Municipal: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. | |||||||||||||||||||||||||||||||||||||||||
Corporate, including privately placed: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. Also included are privately placed securities valued using a discounted cash flow model that is widely accepted in the financial services industry and uses market observable inputs and inputs derived principally from, or corroborated by, observable market data. The primary inputs to the discounted cash flow model include an interest rate yield curve, as well as published credit spreads for similar assets in markets that are not active that incorporate the credit quality and industry sector of the issuer. | |||||||||||||||||||||||||||||||||||||||||
Foreign government: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. | |||||||||||||||||||||||||||||||||||||||||
RMBS: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, prepayment speeds, collateral performance and credit spreads. | |||||||||||||||||||||||||||||||||||||||||
CMBS: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields, collateral performance and credit spreads. | |||||||||||||||||||||||||||||||||||||||||
• | Short-term: The primary inputs to the valuation include quoted prices for identical or similar assets in markets that are not active, contractual cash flows, benchmark yields and credit spreads. For certain short-term investments, amortized cost is used as the best estimate of fair value. | ||||||||||||||||||||||||||||||||||||||||
Level 3 Measurements | |||||||||||||||||||||||||||||||||||||||||
• | Policyholder account balances — Successor; contract holder funds Predessor: Derivatives embedded in certain life and annuity contracts are valued internally using models widely accepted in the financial services industry that determine a single best estimate of fair value for the embedded derivatives within a block of contractholder liabilities. The models primarily use stochastically determined cash flows based on the contractual elements of embedded derivatives, projected option cost and applicable market data, such as interest rate yield curves and equity index volatility assumptions. These are categorized as Level 3 as a result of the significance of nonmarket observable inputs. | ||||||||||||||||||||||||||||||||||||||||
The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2013. There were no assets or liabilities measured at fair value on a non-recurring basis as of December 31, 2013. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Quoted | Significant | Significant | Balance as of | |||||||||||||||||||||||||||||||||||||
prices in | other | unobservable | December 31, | ||||||||||||||||||||||||||||||||||||||
active | observable | inputs | 2013 | ||||||||||||||||||||||||||||||||||||||
markets for | inputs | (Level 3) | |||||||||||||||||||||||||||||||||||||||
identical | (Level 2) | ||||||||||||||||||||||||||||||||||||||||
assets | |||||||||||||||||||||||||||||||||||||||||
(Level 1) | |||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
U.S. government and agencies | $ | 27,520 | $ | 46,326 | $ | — | $ | 73,846 | |||||||||||||||||||||||||||||||||
Municipal | — | 2,769 | — | 2,769 | |||||||||||||||||||||||||||||||||||||
Corporate | — | 191,977 | — | 191,977 | |||||||||||||||||||||||||||||||||||||
Foreign government | — | 5,164 | — | 5,164 | |||||||||||||||||||||||||||||||||||||
RMBS | — | 14,450 | — | 14,450 | |||||||||||||||||||||||||||||||||||||
CMBS | — | 2,676 | — | 2,676 | |||||||||||||||||||||||||||||||||||||
Total fixed maturities | 27,520 | 263,362 | — | 290,882 | |||||||||||||||||||||||||||||||||||||
Short-term investments | 20,764 | 35,195 | — | 55,959 | |||||||||||||||||||||||||||||||||||||
Separate account assets | 1,700,566 | — | — | 1,700,566 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 1,748,850 | $ | 298,557 | $ | — | $ | 2,047,407 | |||||||||||||||||||||||||||||||||
% of total assets at fair value | 85.4 | % | 14.6 | % | — | % | 100 | % | |||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (267,859 | ) | $ | (267,859 | ) | |||||||||||||||||||||||||||||||
Total liabilities at fair value | $ | — | $ | — | $ | (267,859 | ) | $ | (267,859 | ) | |||||||||||||||||||||||||||||||
% of total liabilities at fair value | — | % | — | % | 100 | % | 100 | % | |||||||||||||||||||||||||||||||||
The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements as of December 31, 2013: | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Fair Value | Valuation | Unobservable | Range | Weighted | ||||||||||||||||||||||||||||||||||||
Technique | Input | Average | |||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts — Equity-indexed and forward starting options | $ | (258,415 | ) | Stochastic cash | Projected option | 1.0 - 2.0% | 1.91% | ||||||||||||||||||||||||||||||||||
flow model | cost | ||||||||||||||||||||||||||||||||||||||||
If the projected option cost increased (decreased), it would result in a higher (lower) liability fair value. | |||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the period from January 1, 2014 through March 31, 2014. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2013 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (267,859 | ) | $ | 18,525 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (267,859 | ) | $ | 18,525 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of March 31, | |||||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (3,764 | ) | $ | 2,612 | $ | (250,486 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (3,764 | ) | $ | 2,612 | $ | (250,486 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $17.6 million in interest credited to contractholder funds and $946 thousand in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2013. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2012 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | 312 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | 312 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (314,926 | ) | $ | 43,244 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (314,926 | ) | $ | 43,244 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of December 31, | |||||||||||||||||||||||||||||||||||||||||
2013 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | — | $ | — | $ | — | $ | (312 | ) | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | — | $ | — | $ | — | $ | (312 | ) | $ | — | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (6,621 | ) | $ | 10,444 | $ | (267,859 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (6,621 | ) | $ | 10,444 | $ | (267,859 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $33.0 million in interest credited to contractholder funds and $10.2 million in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2012. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2011 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | 598 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
RMBS | 2,321 | — | — | — | (2,321 | ) | |||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | 2,919 | $ | — | $ | — | $ | — | $ | (2,321 | ) | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (506,678 | ) | $ | 131,054 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (506,678 | ) | $ | 131,054 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of December 31, | |||||||||||||||||||||||||||||||||||||||||
2012 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | — | $ | — | $ | — | $ | (286 | ) | $ | 312 | ||||||||||||||||||||||||||||||
RMBS | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | — | $ | — | $ | — | $ | (286 | ) | $ | 312 | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (11,024 | ) | $ | 71,722 | $ | (314,926 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (11,024 | ) | $ | 71,722 | $ | (314,926 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $125.9 million in interest credited to contractholder funds and $5.1 million in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
Transfers between level categorizations may occur due to changes in the availability of market observable inputs, which generally are caused by changes in market conditions such as liquidity, trading volume or bid-ask spreads. Transfers between level categorizations may also occur due to changes in the valuation source. For example, in situations where a fair value quote is not provided by the Company’s independent third-party valuation service provider and as a result the price is stale or has been replaced with a broker quote whose inputs have not been corroborated to be market observable, the security is transferred into Level 3. Transfers in and out of level categorizations are reported as having occurred at the beginning of the quarter in which the transfer occurred. Therefore, for all transfers into Level 3, all realized and changes in unrealized gains and losses in the quarter of transfer are reflected in the Level 3 rollforward table. | |||||||||||||||||||||||||||||||||||||||||
There were no transfers between Level 1 and Level 2 during the period from January 1, 2014 through March 31, 2014, 2013 or 2012. | |||||||||||||||||||||||||||||||||||||||||
Transfers out of Level 3 during 2012 included situations where a broker quote was used in the prior period and a fair value quote became available from the Company’s independent third-party valuation service provider in the current period. A quote utilizing the new pricing source was not available as of the prior period, and any gains or losses related to the change in valuation source for individual securities were not significant. | |||||||||||||||||||||||||||||||||||||||||
The following table provides the change in unrealized gains and losses included in net income for Level 3 assets and liabilities. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Period from | As of | As of | ||||||||||||||||||||||||||||||||||||||
January 1, | December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||||||||||||||||||
2014 through | |||||||||||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | 18,525 | $ | 43,244 | $ | 131,054 | |||||||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | 18,525 | $ | 43,244 | $ | 131,054 | |||||||||||||||||||||||||||||||||||
The amounts in the table above represent the change in unrealized gains and losses included in net income for the period of time that the asset or liability was determined to be in Level 3. The amount attributable to derivatives embedded in life and annuity contracts is reported as follows: $17.6 million in interest credited to contractholder funds and $946 thousand in contract benefits in the period from January 1, 2014 through March 31, 2014, $33.0 million in interest credited to contractholder funds and $10.2 million in contract benefits in 2013, and $125.9 million in interest credited to contractholder funds and $5.1 million in contract benefits in 2012. These amounts are ceded in accordance with the Company’s reinsurance agreements. | |||||||||||||||||||||||||||||||||||||||||
As of December 31, 2013, financial instruments not carried at fair value included contractholder funds on investment contracts. The carrying value and fair value of contractholder funds on investment contracts were $7.76 billion and $7.66 billion, respectively, as of December 31, 2013. The fair value of contractholder funds on investment contracts is based on the terms of the underlying contracts utilizing prevailing market rates for similar contracts adjusted for the Company’s own credit risk. Deferred annuities included in contractholder funds are valued using discounted cash flow models which incorporate market value margins, which are based on the cost of holding economic capital, and the Company’s own credit risk. Immediate annuities without life contingencies are valued at the present value of future benefits using market implied interest rates which include the Company’s own credit risk. The fair value measurements for contractholder funds on investment contracts are categorized as Level 3. |
Reinsurance
Reinsurance | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Reinsurance | 6 | Reinsurance | |||||||||||
Successor | |||||||||||||
The Company has agreements that provide for reinsurance of certain policy-related risks. Under the agreements, premiums, contract charges, interest credited to policyholder funds, policy benefits and substantially all expenses are reinsured. The Company purchases reinsurance to limit aggregate and single losses on large risks. The Company cedes a portion of the mortality risk on certain life policies under coinsurance agreements to a pool of twelve non-affiliated reinsurers. As of December 31, 2014, approximately 99.8% of the Company’s reinsurance recoverables are due from companies rated A- or better by S&P. ALIC represents over 65% of the Company’s reinsurance recoverable as of December 31, 2014. | |||||||||||||
On April 1, 2014, the Company entered into an experience rated modified coinsurance and monthly renewal term reinsurance arrangement with an external reinsurer. No portion of the assets constituting the consideration has been transferred to the reinsurer. This agreement was structured to finance reserves on certain universal life and fixed annuity products, in exchange for a fee based on those reserves. The profit to the reinsurer expected on the modified coinsurance and monthly renewable term portions is returned through an experience refund. The Company has determined that this agreement does not fulfill the requirements of risk transfer under generally accepted accounting principles and is accounted for on a deposit method of accounting. As of December 31, 2014, the Company had a deposit receivable and a modified coinsurance payable of $1,383 million related to this agreement. | |||||||||||||
The effects of reinsurance on premiums earned and fee income from policyholders for the Successor Period for the period April 1, 2014 through December 31, 2014 were as follows: | |||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Direct | $ | 921,444 | |||||||||||
Assumed | 5,258 | ||||||||||||
Ceded | (702,833 | ) | |||||||||||
Premiums and fee income, net of reinsurance | $ | 223,869 | |||||||||||
The effects of reinsurance on return credited to policyholders’ account balances, policyholder benefits, and other expenses for the Successor Period for the period April 1, 2014 through December 31, 2014 were as follows: | |||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Direct | $ | 1,104,420 | |||||||||||
Assumed | 4,713 | ||||||||||||
Ceded | (635,887 | ) | |||||||||||
Return credited to policyholders’ account balances and policyholder benefits, net of reinsurance | $ | 473,246 | |||||||||||
Predecessor | |||||||||||||
Prior to April 1, 2014, the Company had reinsurance agreements under which it reinsured all of its business to ALIC, Lincoln Benefit Re (“LB Re”) or non-affiliated reinsurers. Under the agreements, premiums, contract charges, interest credited to policyholders account balances, contract benefits and substantially all expenses were reinsured. The Company purchased reinsurance to limit aggregate and single losses on large risks. The Company ceded a portion of the mortality risk on certain life policies under coinsurance agreements to a pool of twelve non-affiliated reinsurers. | |||||||||||||
As of December 31, 2013, 86.9% of the total reinsurance recoverables were related to ALIC and 13.1% were related to non-affiliated reinsurers. As of December 31, 2013, 95% of the Company’s non-affiliated reinsurance recoverables are due from companies rated A- or better by S&P. | |||||||||||||
The effects of reinsurance on premiums and contract charges are as follows: | |||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Direct | $ | 331,899 | $ | 1,331,597 | $ | 1,298,864 | |||||||
Assumed | 1,581 | 6,830 | 6,784 | ||||||||||
Ceded: | |||||||||||||
Affiliate | (244,797 | ) | (962,576 | ) | (908,459 | ) | |||||||
Non-affiliate | (88,683 | ) | (375,851 | ) | (397,189 | ) | |||||||
Premiums and fee income, net of reinsurance | $ | — | $ | — | $ | — | |||||||
The effects of reinsurance on return credited to policyholders’ account balances, policyholder benefits and other expenses are as follows: | |||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Direct | $ | 450,041 | $ | 1,938,015 | $ | 1,882,714 | |||||||
Assumed | 2,606 | 8,180 | 9,167 | ||||||||||
Ceded: | |||||||||||||
Affiliate | (336,122 | ) | (1,505,010 | ) | (1,369,305 | ) | |||||||
Non-affiliate | (116,525 | ) | (441,185 | ) | (522,576 | ) | |||||||
Return credited to policyholders, contract benefits and expenses, net of reinsurance | $ | — | $ | — | $ | — | |||||||
Income_Taxes
Income Taxes | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Income Taxes | 7 | Income Taxes | |||||||||||
Successor | |||||||||||||
In connection with the Acquisition as defined in Note 1, ALIC made an election under Treasury Regulation Section 1.1502-36(d) to reduce the tax basis of certain of the Company’s assets immediately prior to the Acquisition. The reduced tax bases were used to determine the deferred tax impact under the acquisition method of accounting as discussed in Note 1. | |||||||||||||
The Company is party to a federal income tax allocation agreement (the “Tax Allocation Agreement”) with Lancaster Re. The Company and Lancaster Re will file a separate consolidated federal income tax return for the period April 1, 2014 to December 31, 2014 and will continue to do so in future tax years under Internal Revenue Code Section 1504 (c)(1). | |||||||||||||
Following the Acquisition, the Company exited The Allstate Corporation’s consolidated federal income tax return and is no longer a party to the tax allocation agreement with its former affiliates. Final tax settlements were agreed to with The Allstate Corporation and no future tax allocations are expected to occur with The Allstate Corporation. | |||||||||||||
As part of the Acquisition, although the Company remains jointly and severally liable for consolidated tax liabilities for years prior to the Acquisition, the Company is held harmless by ALIC in accordance with the Acquisition agreement and believes the possibility of a tax liability for the pre-sale tax years is remote. Additionally, the Company does not believe it has any uncertain tax positions for its federal income tax return that would be material to its financial condition, results of income, or cash flows. Therefore, the Company did not record a liability for unrecognized tax contingencies/benefits at December 31, 2014. As of December 31, 2014, there were no uncertain tax positions for which management believes it is reasonably possible that the total amounts of tax contingencies will significantly increase within 12 months of the reporting date. No amounts have been accrued for interest or penalties. | |||||||||||||
The components of the deferred income tax assets and liabilities as of December 31, 2014 are as follows: | |||||||||||||
($ in thousands) | December 31, 2014 | ||||||||||||
Deferred tax assets | |||||||||||||
Policyholder reserves | $ | 2,057,627 | |||||||||||
Deferred acquisition costs | 24,850 | ||||||||||||
Premiums receivable | 8,197 | ||||||||||||
Net operating loss carryforward | 7,500 | ||||||||||||
Other assets | 38 | ||||||||||||
Total deferred tax assets | $ | 2,098,212 | |||||||||||
Deferred tax liabilities | |||||||||||||
Value of business acquired | $ | (81,032 | ) | ||||||||||
Amounts recoverable from reinsurers | (2,010,157 | ) | |||||||||||
Investments | (45,935 | ) | |||||||||||
Intangibles | (1,820 | ) | |||||||||||
Total deferred tax liabilities | $ | (2,138,944 | ) | ||||||||||
Net deferred tax liability | $ | (40,732 | ) | ||||||||||
The Company evaluates the recoverability of deferred tax assets and establishes a valuation allowance if necessary to reduce the deferred tax asset to an amount that is more likely than not expected to be realized. Considerable judgment is required in determining whether a valuation allowance is necessary, and if so, the amount of such valuation allowance. In evaluating the need for a valuation allowance the Company considers many factors, including: (1) the nature of the deferred tax assets and liabilities; (2) whether they are ordinary or capital; (3) in which tax jurisdictions they were generated and the timing of their reversal; (4) taxable income in prior carryback years as well as projected taxable earnings exclusive of reversing temporary differences and carryforwards; (5) the length of time that any tax attribute carryovers can be utilized in the various taxing jurisdictions; (6) any unique tax rules that would impact the utilization of the deferred tax assets; and (7) prudent and feasible tax planning strategies that the Company would employ to avoid a tax benefit from expiring | |||||||||||||
unused. Although realization is not assured, management believes it is more likely than not that the deferred tax assets will be realized. The Company had no valuation allowance as of December 31, 2014. Management believes the Company will produce sufficient taxable income in the future to realize its deferred tax assets. Adjustments to the valuation allowance will be made if there is a change in management’s assessment of the amount of deferred tax asset that is realizable. | |||||||||||||
The Company has a net operating loss carryforward as of December 31, 2014 of approximately $21.5 million that will expire in the year 2029, if unused. | |||||||||||||
A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations for the Successor Period from April 1, 2014 through December 31, 2014 were as follows: | |||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Expected federal income tax expense | $ | 15,722 | |||||||||||
Dividends received deduction | (1,470 | ) | |||||||||||
Other | (18 | ) | |||||||||||
Total income tax expense | $ | 14,234 | |||||||||||
The dividends received deduction (“DRD”) reduces the amount of dividend income subject to U.S. tax and is the primary component of the non-taxable investment income, and, as such, is a significant component of the difference between the Company’s effective tax rate and the federal statutory tax rate of 35%. The actual current year DRD can vary from the estimate based on factors such as, but not limited to, changes in the amount of dividends received that are eligible for the DRD, changes in the amount of distributions received from mutual fund investments, changes in the account balances of variable life and annuity contracts, and the Company’s taxable income before the DRD. | |||||||||||||
There remains the possibility that the IRS and the U.S. Treasury will address, through subsequent guidance, issues related to the calculation of the DRD. For the last several years, the revenue provisions included in the Obama Administration’s budgets included a proposal that would change the method used to determine the amount of the DRD. A change in the DRD, including the possible retroactive or prospective elimination of this deduction through guidance or legislation, could increase actual tax expense and reduce the Company’s consolidated net income. | |||||||||||||
Predecessor | |||||||||||||
Prior to April 1, 2014, the Company joined The Allstate Corporation and its other subsidiaries (the “Allstate Group”) in the filing of a consolidated federal income tax return and was party to a federal income tax allocation agreement (the “Allstate Tax Sharing Agreement”). Under the Allstate Tax Sharing Agreement, the Company paid to or received from The Allstate Corporation the amount, if any, by which the Allstate Group’s federal income tax liability was affected by virtue of inclusion of the Company in the consolidated federal income tax return. The Company also had a supplemental tax sharing agreement with respect to reinsurance ceded to ALIC to allocate the tax benefits and costs related to such reinsurance. Effectively, these agreements resulted in the Company’s annual income tax provision being computed, with adjustments, as if the Company filed a separate return, adjusted for the reinsurance ceded to ALIC. | |||||||||||||
The IRS is currently examining the Allstate Group’s 2011 and 2012 federal income tax returns. The IRS has completed its examination of the Allstate Group’s 2009 and 2010 federal income tax returns and a final settlement related to the examination was approved by the IRS Appeals Division on September 19, 2014. The Allstate Group’s tax years prior to 2009 have been examined by the IRS and the statute of limitations has expired on those years. Any adjustments that may result from IRS examinations of tax returns are not expected to have a material effect on the results of operations, cash flows or financial position of the Company. | |||||||||||||
The Company had no liability for unrecognized tax benefits as of December 31, 2013. | |||||||||||||
The components of the deferred income tax assets and liabilities as of December 31 are as follows: | |||||||||||||
($ in thousands) | 2013 | ||||||||||||
Deferred assets | |||||||||||||
Reinsurance recoverables | $ | 497 | |||||||||||
Other assets | 4 | ||||||||||||
Total deferred assets | 501 | ||||||||||||
Deferred liabilities | |||||||||||||
Unrealized net capital gains | (2,084 | ) | |||||||||||
Accrued expenses | (981 | ) | |||||||||||
Other liabilities | — | ||||||||||||
Total deferred liabilities | (3,065 | ) | |||||||||||
Net deferred liability | $ | (2,564 | ) | ||||||||||
The components of income tax expense are as follows: | |||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Current | $ | 914 | $ | 3,902 | $ | 4,145 | |||||||
Deferred | 8 | (77 | ) | 128 | |||||||||
Total income tax expense | $ | 922 | $ | 3,825 | $ | 4,273 | |||||||
The Company paid no income taxes in the period from January 1, 2014 through March 31, 2014. The Company paid income taxes of $4.2 million and $4.8 million in 2013 and 2012, respectively. | |||||||||||||
A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations is as follows: | |||||||||||||
Period from January 1, 2014 | 2013 | 2012 | |||||||||||
through March 31, 2014 | |||||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Other | — | — | — | ||||||||||
Effective income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Future_Policy_Benefits_and_Oth
Future Policy Benefits and Other Policyholder Liabilities | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Future Policy Benefits and Other Policyholder Liabilities | 8 | Future Policy Benefits and Other Policyholder Liabilities | |||||||||
Life insurance liabilities include reserves for death benefits and other policy benefits. As of December 31, 2014 and 2013, future policy benefits and other policyholder liabilities consisted of the following: | |||||||||||
Successor | Predecessor | ||||||||||
($ in thousands) | December 31, 2014 | December 31, 2013 | |||||||||
Traditional life insurance | $ | 1,492,438 | $ | 1,548,134 | |||||||
Immediate fixed annuities | 635,858 | 676,565 | |||||||||
Accident and health insurance | 1,462,110 | 1,324,268 | |||||||||
Equity indexed annuities | 1,895,889 | — | |||||||||
Other | 977,669 | 8,444 | |||||||||
Total | $ | 6,463,964 | $ | 3,557,411 | |||||||
Successor | |||||||||||
Future policy benefits are generally equal to the present value of future benefit payments and related expenses, less the present value of future net premiums. Assumptions as to mortality, morbidity and persistency are based on the Company’s experience, industry data, and/or other factors, when the basis of the reserve is established. Interest rates used in the determination of present values range from 2.5% to 6.0% for setting reserves. | |||||||||||
Predecessor | |||||||||||
The following table highlights the key assumptions generally used in calculating the reserve for life-contingent contract benefits as of December 31, 2013: | |||||||||||
Product | Mortality | Interest rate | Estimation method | ||||||||
Traditional life insurance | Actual company experience plus loading | Interest rate assumptions range from 2.5% to 8.0% | Net level premium reserve method using the Company’s withdrawal experience rates; includes reserves for unpaid claims | ||||||||
Immediate fixed annuities | 1983 individual annuity mortality table with internal modifications; 1983 individual annuity mortality table; Annuity 2000 mortality table with internal modifications | Interest rate assumptions range from 0% to 8.8% | Present value of expected future benefits based on historical experience | ||||||||
Accident and health insurance | Actual company experience plus loading | Interest rate assumptions range from 4.0% to 5.3% | Unearned premium; additional contract reserves for mortality risk and unpaid claims | ||||||||
Other: | Annuity 2000 mortality table with internal modifications | Interest rate assumptions range from 4.0% to 5.8% | Projected benefit ratio applied to cumulative assessments | ||||||||
Variable annuity guaranteed minimum death benefits |
Policyholder_Account_Balances
Policyholder Account Balances | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Policyholder Account Balances | 9 | Policyholder Account Balances | |||||||||
As of December 31, 2014 and 2013, policyholders’ account balances consisted of the following: | |||||||||||
Successor | Predecessor | ||||||||||
($ in thousands) | December 31, 2014 | December 31, 2013 | |||||||||
Interest-sensitive life contracts | $ | 5,008,094 | $ | 5,020,265 | |||||||
Individual annuities | 4,806,270 | 7,803,892 | |||||||||
Other | 14,973 | 299,958 | |||||||||
Total policyholders’ account balances | $ | 9,829,337 | $ | 13,124,115 | |||||||
Successor | |||||||||||
Policyholders’ account balances represent an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges, if applicable. These policyholders’ account balances also include provisions for benefits under non-life contingent payout annuities. Interest crediting rates range from 0.4% to 6.0% for interest sensitive contracts. Interest crediting rates for individual annuities range from 0.0% to 6.0%. | |||||||||||
Predecessor | |||||||||||
The following table highlights the key contract provisions relating to policyholders’ account balances: | |||||||||||
Product | Interest rate | Withdrawal/surrender charges | |||||||||
Interest-sensitive life insurance | Interest rates credited range from 0% to 10.0% for equity-indexed life (whose returns are indexed to the S&P 500) and 2.6% to 6.0% for all other products | Either a percentage of account balance or dollar amount grading off generally over 20 years | |||||||||
Fixed annuities | Interest rates credited range from 0% to 8.8% for immediate annuities; 0% to 7.0% for equity-indexed annuities (whose returns are indexed to the S&P 500); and 1.0% to 6.0% for all other products | Either a declining or a level percentage charge generally over ten years or less. Additionally, approximately 18.7% of fixed annuities are subject to market value adjustment for discretionary withdrawals. | |||||||||
Other investment contracts: | Interest rates used in establishing reserves range from 1.7% to 10.3% | Withdrawal and surrender charges are based on the terms of the related interest-sensitive life insurance or fixed annuity contract | |||||||||
Guaranteed minimum income, accumulation and withdrawal benefits on variable and fixed annuities and secondary guarantees on interest-sensitive life and fixed annuities |
Certain_Nontraditional_LongDur
Certain Nontraditional Long-Duration Contracts | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Certain Nontraditional Long-Duration Contracts | 10 | Certain Nontraditional Long-Duration Contracts | |||||||||||||||||||
The Company offered traditional variable annuity contracts through its separate accounts for which investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contractholder. The Company also offered variable annuity contracts with general and separate account options where the Company contractually guarantees to the contractholder a return of no less than total deposits made to the contract less any partial withdrawals (“return of net deposits”). In certain of these variable annuity contracts, the Company also contractually guarantees to the contractholder a return of no less than (1) total deposits made to the contract less any partial withdrawals plus a minimum return (“minimum return”), and/or (2) the highest contract value on a specified date adjusted for any withdrawals (“contract value”). These guarantees include benefits that are payable in the event of death, annuitization or at specified dates during the accumulation period and withdrawal and income benefits payable during specified periods. The Company also issues annuity contracts with market value adjusted investment options (“MVAs”), which provide for a return of principal plus a fixed rate of return if held to maturity, or, alternatively, a “market adjusted value” if surrendered prior to maturity or if funds are allocated to other investment options. The market value adjustment may result in a gain or loss to the Company, depending on crediting rates or an indexed rate at surrender, as applicable. The Company also issues fixed deferred annuity contracts without MVA that have a guaranteed credited rate and annuity benefit. All of the risks associated with the Company’s variable annuity contracts are reinsured with external reinsurers. | |||||||||||||||||||||
In addition, the Company issues certain variable life, variable universal life and universal life contracts where the Company contractually guarantees to the contractholder a death benefit even when there is insufficient value to cover monthly mortality and expense charges, whereas otherwise the contract would typically lapse (“no lapse guarantee”). Variable life and variable universal life contracts are offered with general and separate account options similar to variable annuities. | |||||||||||||||||||||
The assets supporting the variable portion of both traditional variable annuities and certain variable contracts with guarantees are carried at fair value and reported as Separate Account assets with an equivalent amount reported as Separate Account liabilities. Amounts assessed against the contractholders for mortality, administration, and other services are included within revenue in fee income from policyholders and changes in liabilities for minimum guarantees are generally included in policyholder benefits in the Consolidated Statement of Operations and Comprehensive Income (Loss) (Successor) and Statements of Operations and Comprehensive Income (Predecessor). | |||||||||||||||||||||
For those guarantees of benefits that are payable in the event of death, the net amount at risk is generally defined as the current guaranteed minimum death benefit in excess of the current account balance at the balance sheet date. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, contract lapses and contractholder mortality. | |||||||||||||||||||||
For guarantees of benefits that are payable at annuitization, the net amount at risk is generally defined as the present value of the minimum guaranteed annuity payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including fixed income and equity market returns, benefit utilization, timing of annuitization, contract lapses and contractholder mortality. | |||||||||||||||||||||
For guarantees of benefits that are payable at withdrawal, the net amount at risk is generally defined as the present value of the minimum guaranteed withdrawal payments available to the contractholder determined in accordance with the terms of the contract in excess of the current account balance. For guarantees of accumulation balances, the net amount at risk is generally defined as the guaranteed minimum accumulation balance minus the current account balance. The Company’s primary risk exposures for these contracts relates to actual deviations from, or changes to, the assumptions used in the original pricing of these products, including equity market returns, interest rates, market volatility or contractholder behavior used in the original pricing of these products. | |||||||||||||||||||||
The Company’s contracts with guarantees may offer more than one type of guarantee in each contract; therefore, the amounts listed may not be mutually exclusive. The liabilities related to the net amount at risk are reflected within Future policy benefits and other policyholder liabilities or Policyholders’ account balances. As of December 31, 2014, the Company had the following guarantees associated with these contracts, by product and guarantee type: | |||||||||||||||||||||
Successor | |||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||
($ in millions) | In the Event of | At | For Cumulative | Accumulation | |||||||||||||||||
Death | Annuitization/ | Periodic Withdrawals | at Specified | ||||||||||||||||||
Accumulation(1) | Dates | ||||||||||||||||||||
Variable Annuity Contracts | |||||||||||||||||||||
Separate Account value | $ | 742.7 | $ | 151.9 | $ | 16.6 | $ | 118.4 | |||||||||||||
Net amount at risk | $ | 57.2 | $ | 15.2 | $ | 0.1 | $ | 6.2 | |||||||||||||
Average attained age of contractholders | 60 years | N/A | N/A | N/A | |||||||||||||||||
Weighted average waiting period until guarantee date | N/A | None | N/A | 6 years | |||||||||||||||||
Variable Life, Variable Universal Life and Universal Life Contracts | |||||||||||||||||||||
No Lapse Guarantees: | |||||||||||||||||||||
Separate Account value | $ | 325.1 | |||||||||||||||||||
General account value | $ | 31518.3 | |||||||||||||||||||
Net amount at risk | $ | 89,942.8 | |||||||||||||||||||
Average attained age of contractholders | 51 years | ||||||||||||||||||||
As of December 31, 2013, the Company had the following guarantees associated with these contracts, by product and guarantee type: | |||||||||||||||||||||
Predecessor | |||||||||||||||||||||
December 31, 2013 | |||||||||||||||||||||
($ in millions) | In the Event of | At | For Cumulative | Accumulation | |||||||||||||||||
Death | Annuitization/ | Periodic Withdrawals | at Specified | ||||||||||||||||||
Accumulation(1) | Dates | ||||||||||||||||||||
Variable Annuity Contracts | |||||||||||||||||||||
Separate Account value | $ | 877 | $ | 170.5 | $ | 21.8 | $ | 151.1 | |||||||||||||
Net amount at risk | $ | 63.2 | $ | 16.6 | $ | 0.1 | $ | 7.3 | |||||||||||||
Average attained age of contractholders | 59 years | N/A | N/A | N/A | |||||||||||||||||
Weighted average waiting period until guarantee date | N/A | None | N/A | 6 years | |||||||||||||||||
Liabilities for Guarantee Benefits | |||||||||||||||||||||
The table below summarizes the changes in general account liabilities for guarantees on variable contracts. The liabilities for guaranteed minimum death benefits (“GMDB”) and secondary guarantees on interest-sensitive life and fixed annuities are included in Future policy benefits and other policyholder liabilities on the Consolidated Balance Sheet (Successor) and the related changes in the liabilities are included in policyholder benefits in the Consolidated Statement of Operations and Comprehensive Income (Loss) for the Successor Period from April 1, 2014 through December 31, 2014. In the Predecessor Period, secondary guarantees on interest-sensitive life and fixed annuities are included in policyholders’ account balances. Guaranteed minimum income benefits (“GMIB”), guaranteed minimum withdrawal benefits (“GMWB”) and guaranteed minimum accumulation benefits (“GMAB”) features are accounted for as bifurcated embedded derivatives and are recorded at fair value within Policyholders’ account balances on the Consolidated Balance Sheet (Successor). | |||||||||||||||||||||
GMDB | GMIB | GMWB/ | Secondary | ||||||||||||||||||
GMAB | Guarantees | ||||||||||||||||||||
($ in thousands) | Variable | Variable | Variable | Interest- | Total | ||||||||||||||||
Annuity | Annuity | Annuity | Sensitive | ||||||||||||||||||
Life and | |||||||||||||||||||||
Fixed | |||||||||||||||||||||
Annuities | |||||||||||||||||||||
Predecessor | |||||||||||||||||||||
Balance as of December 21, 2012 | $ | 9,390 | $ | 19,484 | $ | 19,621 | $ | 200,688 | $ | 249,183 | |||||||||||
Less: reinsurance recoverable | 9,390 | 19,484 | 19,621 | 200,688 | 249,183 | ||||||||||||||||
Net balance as of December 31, 2012 | — | — | — | — | — | ||||||||||||||||
Incurred guarantee benefits | — | — | — | — | — | ||||||||||||||||
Paid guarantee benefits | — | — | — | — | — | ||||||||||||||||
Net change | — | — | — | — | — | ||||||||||||||||
Net balance as of December 31, 2013 | — | — | — | — | — | ||||||||||||||||
Plus reinsurance recoverable | 8,444 | 8,743 | 9,444 | 281,771 | 308,402 | ||||||||||||||||
Balance as of December 31, 2013 | $ | 8,444 | $ | 8,743 | $ | 9,444 | $ | 281,771 | $ | 308,402 | |||||||||||
Less: reinsurance recoverable | 8,444 | 8,743 | 9,444 | 281,771 | 308,402 | ||||||||||||||||
Net balance as of December 31, 2013 | — | — | — | — | — | ||||||||||||||||
Incurred guarantee benefits | — | — | — | — | — | ||||||||||||||||
Paid guarantee benefits | — | — | — | — | — | ||||||||||||||||
Net change | — | — | — | — | — | ||||||||||||||||
Net balance as of March 31, 2014 | — | — | — | — | — | ||||||||||||||||
Plus reinsurance recoverable | 8,057 | 7,122 | 8,499 | 293,704 | 317,382 | ||||||||||||||||
Balance as of March 31, 2014 | $ | 8,057 | $ | 7,122 | $ | 8,499 | $ | 293,704 | $ | 317,382 | |||||||||||
Successor | |||||||||||||||||||||
Balance as of April 1, 2014 | $ | 8,057 | $ | 7,122 | $ | 8,499 | $ | 552,163 | $ | 575,841 | |||||||||||
Less: reinsurance recoverable | 8,057 | 7,122 | 8,499 | 67,288 | 90,966 | ||||||||||||||||
Net balance as of April 1, 2014 | — | — | — | 484,875 | 484,875 | ||||||||||||||||
Incurred guarantee benefits | — | — | — | 159,104 | 159,104 | ||||||||||||||||
Paid guarantee benefits | — | — | — | (108,252 | ) | (108,252 | ) | ||||||||||||||
Net change | — | — | — | 50,852 | 50,852 | ||||||||||||||||
Net balance as of December 31, 2014 | — | — | — | 535,727 | 535,727 | ||||||||||||||||
Plus reinsurance recoverable | 8,358 | 8,240 | 6,733 | 83,733 | 107,064 | ||||||||||||||||
Balance as of December 31, 2014 | $ | 8,358 | $ | 8,240 | $ | 6,733 | $ | 619,460 | $ | 642,791 | |||||||||||
Value_of_Business_Acquired
Value of Business Acquired | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Value of Business Acquired | 11 | Value of Business Acquired | |||
The following reflects the changes to the VOBA asset: | |||||
($ in thousands) | For the Period from | ||||
April 1, 2014 | |||||
Through December 31, | |||||
2014 | |||||
Balance at beginning of period | $ | 290,795 | |||
Business acquired | — | ||||
Amortized to expense during the year(1) | (38,987 | ) | |||
Adjustment for unrealized investment gains during the year | (20,287 | ) | |||
Balance at end of year | $ | 231,521 | |||
-1 | Amount is included in Other Expenses on the Consolidated Statement of Operations and Other Comprehensive Income (Loss) | ||||
The following table provides estimated percentage of the VOBA balance to be amortized for the years indicated: | |||||
VOBA | |||||
Amortization | |||||
2015 | 14 | % | |||
2016 | 12 | % | |||
2017 | 11 | % | |||
2018 | 9 | % | |||
2019 and thereafter | 54 | % |
Commitments_and_Contingencies
Commitments and Contingencies | 12 Months Ended | |||
Dec. 31, 2014 | ||||
Commitments and Contingencies | 12 | Commitments and Contingencies | ||
Regulation and Compliance | ||||
The Company is subject to changing social, economic and regulatory conditions. From time to time, regulatory authorities or legislative bodies seek to impose additional regulations regarding agent and broker compensation, regulate the nature of and amount of investments, and otherwise expand overall regulation of insurance products and the insurance industry. The Company has established procedures and policies to facilitate compliance with laws and regulations, to foster prudent business operations, and to support financial reporting. The Company routinely reviews its practices to validate compliance with laws and regulations and with internal procedures and policies. As a result of these reviews, from time to time the Company may decide to modify some of its procedures and policies. Such modifications, and the reviews that led to them, may be accompanied by payments being made and costs being incurred. The ultimate changes and eventual effects of these actions on the Company’s business, if any, are uncertain. | ||||
The Company is currently being examined by certain states for compliance with unclaimed property laws. It is possible that this examination may result in additional payments of abandoned funds to states and to changes in the Company’s practices and procedures for the identification of escheatable funds, which could impact benefit payments and reserves, among other consequences; however, it is not likely to have a material effect on the financial statements of the Company. | ||||
The Company is assessed amounts by the state guaranty funds to cover losses to policyholders of insolvent or rehabilitated insurance companies. Those mandatory assessments may be partially recovered through a reduction in future premium taxes in certain states. At December 31, 2014, the Company accrued $6.7 million for guaranty fund assessments which is expected to be offset by estimated future premium tax deductions of $11.2 million. | ||||
Litigation | ||||
The Company is involved from time to time in judicial, regulatory and arbitration proceedings concerning matters arising in connection with the conduct of its business. As part of the Acquisition, ALIC has agreed to indemnify the Company for certain matters. ALIC has also agreed to indemnify the Company for certain litigation, regulatory matters and other liabilities related to the pre-closing activities of the transferred business. Management believes, based on currently available information, that the results of such proceedings, in the aggregate, will not have a material adverse effect on the Company’s financial condition. Given the inherent difficulty of predicting the outcome of the Company’s litigation and regulatory matters, particularly in cases or proceedings in which substantial or indeterminate damages or fines are sought, the Company cannot estimate losses or ranges of losses for cases or proceedings where there is only a reasonable possibility that a loss may be incurred. However, the Company believes that at the present time there are no pending or threatened lawsuits that are reasonably likely to have a material adverse effect on the consolidated financial position or results of operations. | ||||
In the normal course of its business, the Company has entered into agreements that include indemnities in favor of third parties, such as contracts with advisors and consultants, outsourcing agreements, information technology agreements and service agreements. The Company has also agreed to indemnify its directors, officers and employees in accordance with the Company’s by-laws. The Company believes any potential liability under these agreements is neither probable nor estimable. Therefore, the Company has not recorded any associated liability. | ||||
Pledged or Restricted Assets | ||||
The Company had the following restricted assets: | ||||
• | Certain bonds were on deposit with governmental authorities as required by law of $8.9 million and $9.4 million at December 31, 2014 and December 31, 2013, respectively. | |||
• | Derivative cash collateral received was reported as cash equivalents of $6.4 million at December 31, 2014. The Company had no derivative cash collateral as of December 31, 2013. |
Regulatory_Capital_and_Dividen
Regulatory Capital and Dividends | 12 Months Ended | |
Dec. 31, 2014 | ||
Regulatory Capital and Dividends | 13 | Regulatory Capital and Dividends |
The Company prepares its statutory-basis financial statements in conformity with accounting practices prescribed or permitted by the State of Nebraska. Prescribed statutory accounting practices include a variety of publications of the National Association of Insurance Commissioners (“NAIC”), as well as state laws, regulations and general administrative rules. Permitted statutory accounting practices encompass all accounting practices not so prescribed. | ||
The State of Nebraska requires insurance companies domiciled in its state to prepare statutory-basis financial statements in conformity with the NAIC Accounting Practices and Procedures Manual, subject to any deviations prescribed or permitted by the State of Nebraska Insurance Commissioner. Statutory accounting practices differ from GAAP primarily since they require establishing life insurance reserves based on different actuarial assumptions, and valuing certain investments at amortized cost. | ||
Statutory net income was $226 million and $7.7 million for the years ended December 31, 2014 and December 31, 2013. Statutory capital and surplus was $719 million and $332.5 million as of December 31, 2014 and December 31, 2013, respectively. | ||
Dividend Limitations | ||
The ability of the Company to pay dividends is dependent on business conditions, income, cash requirements and other relevant factors. The payment of shareholder dividends by the Company without the prior approval of the Department of Insurance is limited to formula amounts based on net income and capital and surplus, determined in conformity with statutory accounting practices, as well as, the timing and amount of dividends paid in the preceding twelve months. In connection with the Acquisition, prior approval of the Nebraska Director of Insurance is required for the Company for any dividend or distribution for five years subsequent to the Acquisition. | ||
Other | ||
Without the prior approval of the Nebraska Director of Insurance, the Company may not: | ||
1 | Acquire or enter into an agreement or understanding to acquire control of any insurer, assumptively acquire policies, or bulk reinsure business during the period of three years after the Acquisition. | |
2 | Provide or propose to provide directly or indirectly any loans, advances, guarantees, pledges, or other financial assistance (excluding policy loans or investment portfolio transactions) during the period of three years after the Acquisition. | |
3 | Engage in any material transaction during the period of three years after the Acquisition. “Material transaction” shall mean any transfer or encumbrance of assets that, together with all other transfers or encumbrances made within the preceding twelve months, exceeds in value the greater of five percent of Lincoln Benefit’s surplus as of the December 31st of the last preceding, or the net gain from operations of Lincoln Benefit for the twelve-month period ending the December 31st of the last preceding. For the purposes of this clause, “Material Transaction” shall exclude (i) investment portfolio transactions (ii) settlement of balances due to policyholders, agents or third party reinsurers under existing reinsurance agreements or (iii) settlement of ordinary course payables including but not limited to taxes, third party administrators, suppliers or other ordinary course creditors, and intercompany payables arising under any approved intercompany services agreement | |
Under state insurance laws, insurance companies are required to maintain paid up capital of not less than the minimum capital requirement applicable to the types of insurance they are authorized to write. Insurance companies are also subject to risk-based capital (“RBC”) requirements adopted by state insurance regulators. A company’s “authorized control level RBC” is calculated using various factors applied to certain financial balances and activity. Companies that do not maintain statutory capital and surplus at a level in excess of the company action level RBC, which is two times authorized control level RBC, are required to take specified actions. Company action level RBC is significantly in excess of the minimum capital requirements. |
Leases
Leases | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Leases | 14 | Leases | |||
In December 2014, the Company entered into a lease agreement, effective February 2015, to lease office space under a non-cancellable operating lease agreement that expires in January 31, 2026. For the period from April 1, 2014 through December 31, 2014, the Company made no payments pursuant to this operating lease. | |||||
The minimum aggregate rental commitments as of December 31, 2014 were as follows: | |||||
(in thousands) | |||||
2015 | $ | 97 | |||
2016 | 194 | ||||
2017 | 207 | ||||
2018 | 212 | ||||
2019 | 217 | ||||
All future years | 1,712 | ||||
Aggregate total | $ | 2,639 | |||
The Company did not have any lease obligations at December 31, 2013. |
Related_Parties
Related Parties | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Related Parties | 15 | Related Parties | |||||||||||
Successor | |||||||||||||
On April 1, 2014, the Company entered into a management services agreement with Resolution. Under this agreement, Resolution and Lincoln Benefit provide services to each other including but not limited to compliance, legal, risk management, accounting and reporting, treasury, tax and other management related services. Services are provided at cost. Resolution provided $21.1 million in services to Lincoln Benefit for the period from April 1, 2014 through December 31, 2014. | |||||||||||||
Effective April 1, 2014, the Company entered into a Fee Letter (the “Fee Letter”) with Lanis LLC (“Lanis”) pursuant to which the Company will pay Lanis the risk spread due on the Vehicle Note issued by Lanis to Lancaster Re. The total expense related to this risk spread for the period from April 1, 2014 through December 31, 2014 was approximately $4.6 million. | |||||||||||||
The Company reported the following receivables/ (payables) to affiliates as of December 31, 2014: | |||||||||||||
Resolution | $ | (4,509,447 | ) | ||||||||||
Lanis | $ | (1,563,783 | ) | ||||||||||
Intercompany receivable and payable balances are evaluated on an individual company basis. Intercompany balances are generally settled quarterly. | |||||||||||||
The Company’s stock is pledged as collateral on Resolution’s term loan agreement with a syndicate of lenders (“Term Loan”). The maturity date of the loan is June 15, 2018. The Term Loan was funded on April 1, 2014. | |||||||||||||
On April 1, 2014, the Company and Resolution entered into a Letter Agreement whereby from and after the fifth anniversary of the date of the agreement, if the Company makes any payment pursuant to the Fee Letter, within ten Business Days of such payment by the Company, Resolution shall reimburse the Company in cash in an amount equal to such payment by the Company. | |||||||||||||
Predecessor | |||||||||||||
All intercompany balances were settled prior to the Acquisition. | |||||||||||||
Business operations | |||||||||||||
Prior to April 1, 2014, the Company used services performed by its affiliates, Allstate Insurance Company (“AIC”), ALIC and Allstate Investments LLC, and business facilities owned or leased and operated by AIC in conducting its business activities. In addition, the Company shared the services of employees with AIC. The Company reimbursed its affiliates for the operating expenses incurred on behalf of the Company. The Company was charged for the cost of these operating expenses based on the level of services provided. Operating expenses allocated to the Company were $50.1 million, $249.7 million and, $241.8 million in the period from January 1, 2014 through March 31, 2014, for the years ended December 31, 2013 and, 2012, respectively. Of these costs, the Company retained investment related expenses on the invested assets that were not transferred under the reinsurance agreements. All other costs were ceded to ALIC under the reinsurance agreements. | |||||||||||||
Broker-Dealer agreements | |||||||||||||
Prior to April 1, 2014, the Company had a service agreement with Allstate Distributors, L.L.C. (“ADLLC”), a broker-dealer company owned by ALIC, whereby ADLLC promoted and marketed products sold by the Company. In return for these services, the Company recorded expense of $12 thousand, $71 thousand and $80 thousand in the period from January 1, 2014 through March 31, 2014, for the years ended December 31, 2013 and 2012, respectively, that was ceded to ALIC under the terms of the reinsurance agreements. | |||||||||||||
Prior to April 1, 2014, the Company received distribution services from Allstate Financial Services, LLC, an affiliated broker-dealer company, for certain annuity and variable life insurance contracts sold by Allstate exclusive agencies. For these services, the Company incurred commission and other distribution expenses of $2.2 million, $7.7 million and $6.4 million in the period from January 1, 2014 through March 31, 2014, for the years ended December 31, 2013 and 2012, respectively, that were ceded to ALIC. | |||||||||||||
Reinsurance | |||||||||||||
The following table summarizes amounts that were ceded to ALIC under reinsurance agreements and reported net in the Statements of Operations and Comprehensive Income. | |||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Premiums and contract charges | $ | 244,797 | $ | 962,576 | $ | 908,459 | |||||||
Interest credited to contractholder funds, contract benefits and expenses | 336,122 | 1,505,010 | 1,369,305 | ||||||||||
Reinsurance recoverables due from ALIC totaled $14.5 billion as of December 31, 2013. | |||||||||||||
In September 2012, the Company entered into a coinsurance reinsurance agreement with LB Re to cede certain interest-sensitive life insurance policies to LB Re. Reinsurance recoverables due from LB Re totaled $1.9 million as of December 31, 2013. | |||||||||||||
Income taxes | |||||||||||||
Prior to April 1, 2014, the Company was a party to a federal income tax allocation agreement with The Allstate Corporation (see Note 7). | |||||||||||||
Intercompany loan agreement | |||||||||||||
Prior to April 1, 2014, the Company had an intercompany loan agreement with The Allstate Corporation. The Company had no amounts outstanding under the intercompany loan agreement as of December 31, 2013. |
Consolidated_Summary_of_Invest
Consolidated Summary of Investments Other Than Investments in Related Parties | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Consolidated Summary of Investments Other Than Investments in Related Parties | Lincoln Benefit Life Company | ||||||||||||
(A Wholly Owned Subsidiary of Resolution Life, Inc.) | |||||||||||||
Schedule I Consolidated Summary of Investments Other Than Investments in Related Parties | |||||||||||||
December 31, 2014 | |||||||||||||
($ in thousands) | Amortized | Fair Value | Amount at which | ||||||||||
Cost | shown in the | ||||||||||||
Consolidated | |||||||||||||
Balance Sheet | |||||||||||||
Type of Investment | |||||||||||||
Fixed maturities: | |||||||||||||
Bonds: | |||||||||||||
United States Government, Government Agencies and Authorities | $ | 1,060,065 | $ | 1,112,535 | $ | 1,112,535 | |||||||
States, municipalities and political subdivisions | — | — | — | ||||||||||
Foreign governments | — | — | — | ||||||||||
Public utilities | — | — | — | ||||||||||
All other corporate bonds | 7,279,391 | 7,377,745 | 7,377,745 | ||||||||||
Residential mortgage-backed securities | 188,055 | 189,881 | 189,881 | ||||||||||
Commercial mortgage-backed securities | 331,041 | 333,483 | 333,483 | ||||||||||
Asset-backed securities | 373,304 | 377,003 | 377,003 | ||||||||||
Total fixed maturities | 9,231,856 | 9,390,647 | 9,390,647 | ||||||||||
Other securities: | |||||||||||||
Mortgage loans | 1,115,167 | 1,115,167 | |||||||||||
Policy loans | 194,385 | 194,385 | |||||||||||
Derivatives | 26,001 | 26,001 | |||||||||||
Other long-term assets | 896 | 896 | |||||||||||
Short-term investments | 361,369 | 361,369 | |||||||||||
Total other securities | 1,697,818 | 1,697,818 | |||||||||||
Total investments | $ | 10,929,674 | $ | 9,390,647 | $ | 11,088,465 | |||||||
Consolidated_Reinsurance
Consolidated Reinsurance | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Consolidated Reinsurance | Lincoln Benefit Life Company | ||||||||||||||||||||
(A Wholly-Owned Subsidiary of Resolution Life, Inc.) | |||||||||||||||||||||
Schedule IV — Consolidated Reinsurance | |||||||||||||||||||||
($ in thousands) | Gross Amount | Ceded to Other | Assumed from | Net Amount | Percentage of | ||||||||||||||||
Companies | Other Companies | Amount | |||||||||||||||||||
Assumed to Net | |||||||||||||||||||||
Successor | |||||||||||||||||||||
Period from April 1, 2014 through December 31, 2014 | |||||||||||||||||||||
Life insurance in force | $ | 395,385,878 | $ | 388,790,881 | $ | 5,106,566 | $ | 11,701,563 | 43.6 | % | |||||||||||
Premiums and contract charges: | |||||||||||||||||||||
Life and annuities | $ | 869,472 | $ | (669,382 | ) | $ | 5,258 | $ | 205,348 | 2.6 | % | ||||||||||
Accident and health insurance | 51,972 | (33,451 | ) | — | 18,521 | 0 | % | ||||||||||||||
$ | 921,444 | $ | (702,833 | ) | $ | 5,258 | $ | 223,869 | 2.3 | % | |||||||||||
Predecessor | |||||||||||||||||||||
Period from January 1, 2014 through March 31, 2014 | |||||||||||||||||||||
Premiums and contract charges: | |||||||||||||||||||||
Life and annuities | $ | 313,410 | $ | (314,991 | ) | $ | 1,581 | $ | — | 0 | % | ||||||||||
Accident and health insurance | 18,489 | (18,489 | ) | — | — | 0 | % | ||||||||||||||
$ | 331,899 | $ | (333,480 | ) | $ | 1,581 | $ | — | 0 | % | |||||||||||
Year ended December 31, 2013 | |||||||||||||||||||||
Life insurance in force | $ | 389,941,404 | $ | 395,421,202 | $ | 5,479,798 | $ | — | 0 | % | |||||||||||
Premiums and contract charges: | |||||||||||||||||||||
Life and annuities | $ | 1,250,623 | $ | (1,257,453 | ) | $ | 6,830 | $ | — | 0 | % | ||||||||||
Accident and health insurance | 80,974 | (80,974 | ) | — | — | 0 | % | ||||||||||||||
$ | 1,331,597 | $ | (1,338,427 | ) | $ | 6,830 | $ | — | 0 | % | |||||||||||
Year ended December 31, 2012 | |||||||||||||||||||||
Life insurance in force | $ | 378,467,115 | $ | 384,205,939 | $ | 5,738,824 | $ | — | 0 | % | |||||||||||
Premiums and contract charges: | |||||||||||||||||||||
Life and annuities | $ | 1,201,592 | $ | (1,208,376 | ) | $ | 6,784 | $ | — | 0 | % | ||||||||||
Accident and health insurance | 97,272 | (97,272 | ) | — | — | 0 | % | ||||||||||||||
$ | 1,298,864 | $ | (1,305,648 | ) | $ | 6,784 | $ | — | 0 | % | |||||||||||
No reinsurance or coinsurance income was netted against premiums ceded in the period from April 1, 2014 through December 31, 2014, the period from January 1, 2014 to March 31, 2014, the year ended December 31, 2013 or the year ended December 31, 2012. |
General_Policies
General (Policies) | 12 Months Ended |
Dec. 31, 2014 | |
Basis of Presentation | Basis of Presentation |
The Company’s financial statements have been prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). The financial statements are presented for Successor and Predecessor periods, which relate to the accounting periods after and before April 1, 2014, respectively, the date of the closing of the Acquisition. For periods after April 1, 2014, the accompanying financial statements comprise the consolidated financial statements of the Company, which include the accounts of the Company and its subsidiary. Due to the Acquisition and the application of push-down accounting, different bases of accounting have been used to prepare the Predecessor and Successor financial statements. A black line separates the Predecessor and Successor financial statements to highlight the lack of comparability between these two periods. The principal accounting policies applied in the preparation of these financial statements are set out below and in Note 2. | |
Consolidation | Consolidation |
The accompanying consolidated financial statements of the Successor include the accounts of Lincoln Benefit and its subsidiary, Lancaster Re. All significant intercompany balances and transactions have been eliminated on consolidation. | |
Use of Estimates | Use of Estimates |
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. | |
Cash | Cash |
Cash includes cash on hand, amounts due from banks, money market securities, highly liquid overnight deposits, discount notes and commercial paper held in the ordinary course of business amounts due from banks, certain money market investments and other debt instruments with maturities of three months or less when purchased. | |
Investments | Investments |
Fixed maturities include bonds, asset-backed securities (“ABS”) residential mortgage-backed securities (“RMBS”) and commercial mortgage-backed securities (“CMBS”). Fixed maturities, which may be sold prior to their contractual maturity, are designated as available-for-sale (“AFS”) and are carried at fair value. The difference between amortized cost and fair value, net of deferred income taxes, is reflected as a component of accumulated other comprehensive income. Cash received from calls, principal payments and make-whole payments and cash received from maturities and pay-downs are reflected as a component of proceeds from sales and maturities within the Consolidated Statement of Cash Flows — Successor and Statement of Cash Flows — Predecessor. | |
The Company recognizes other-than-temporary impairments (“OTTI”) for securities classified as AFS in accordance with ASC 320, Investments-Debt and Equity Securities. At least quarterly, management reviews impaired securities for OTTI. The Company considers several factors when determining if a security is OTTI, including but not limited to: its intent and ability to hold the impaired security until an anticipated recovery in value, the issuer’s ability to meet current and future principal and interest obligations for fixed maturity securities, the length and severity of the impairment, the financial condition and near term and long term prospects for the issuer. In making these evaluations, the Company exercises considerable judgment. | |
If the Company intends to sell or if it is more likely than not that it will be required to sell an impaired security prior to recovery of its cost basis, then the Company recognizes a charge to earnings for the full amount of the impairment (the difference between the amortized cost and fair value of the security). For fixed maturity securities that are considered OTTI and that the Company does not intend to sell and will not be required to sell, the Company separates the impairment into two components: credit loss and noncredit loss. Credit losses are charged to net realized investment losses and noncredit losses are charged to other comprehensive income. The credit loss component is the difference between the security’s amortized cost and the present value of its expected future cash flows discounted at the current effective rate. The remaining difference between the security’s fair value and the present value of its expected future cash flows is the non-credit loss. For corporate bonds, historical default (by rating) data is used as a proxy for the probability of default, and loss given default (by issuer) projections are applied to the par amount of the bond. Potential losses incurred on structured securities are based on expected loss models rather than incurred loss models. Expected cash flows include assumptions about key systematic risks (e.g. unemployment rates, housing prices) and loan-specific information (e.g. delinquency rates, loan-to-value ratios). Estimating future cash flows is a quantitative and qualitative process that incorporates information received from third parties, along with assumptions and judgments about the future performance of the underlying collateral. | |
Commercial mortgage loans (“CMLs”) acquired at fair value are carried at amortized cost using the effective interest rate method. CMLs held by the Company are diversified by property type and geographic area throughout the U.S. CMLs are considered impaired when it is probable that the Company will not collect amounts due according to the terms of the original loan agreement. The Company assesses the impairment of loans individually for all loans in the portfolio. The Company estimates the fair value of the underlying collateral using internal valuations generally based on discounted cash flow analyses. The Company estimates an allowance for loan and lease losses (“ALLL”) representing potential credit losses embedded in the CML portfolio. The estimate is based on a consistently applied analysis of the loan portfolio and takes into consideration all available information, including industry, geographical, economic and political factors. | |
Policy loans represent loans the Company issues to policyholders. Policy loans are carried at unpaid principal balances. Interest income on such loans is recognized as earned using the contractually agreed upon interest rate and reflected in Net investment income in the Consolidated Statement of Operations and Comprehensive Income (Loss). Generally, interest is capitalized on the associated policy’s anniversary date. | |
Short-term investments include securities and other investments with remaining maturities of one year or less, but greater than three months, at the time of purchase and are stated at estimated fair value or amortized cost, which approximates fair value. | |
Derivatives | Derivatives |
As part of the Company’s overall risk management policy, the Company uses listed options and exchange traded futures to economically hedge its obligation under certain fixed indexed annuity and universal life contracts. Derivative financial instruments utilized by the Company in the period from April 1, 2014 through December 31, 2014 (the “Successor Period”) included index option contracts and futures contracts. Derivatives are carried in the Company’s Consolidated Balance Sheet either as assets within Other invested assets or as liabilities within Accrued expenses and other liabilities at estimated fair value. The Company offsets the fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. Accruals on derivatives are generally recorded in accrued investment income or within other liabilities. However, accruals that are not scheduled to settle within one year are included with the derivatives carrying value in other invested assets or other liabilities. If a derivative is not designated as an accounting hedge or its use in managing risk does not qualify for hedge accounting, changes in the estimated fair value of the derivative are reported in realized investment gains, net in the Consolidated Statement of Operations and Comprehensive Income (Loss). The notional amounts specified in the contracts are used to calculate contractual payments under the agreements and are generally not representative of the potential for gain or loss on these contracts. Futures contracts are defined as commitments to buy or sell designated financial instruments based on specified prices, yields or indexes. Futures contracts provide returns at specified or optional dates based upon a specified index or interest rate applied to a notional amount. The Company uses futures to hedge exposures in indexed annuity and life contracts. Daily cash settlement of variation margins is required for futures contracts and is based on the changes in daily prices. The final settlement of futures contracts is in cash. Index option contracts provide returns at specified or optional dates based on a specified equity index applied to the option’s notional amount. The Company purchases and writes (sells) option contracts primarily to reduce market risk associated with certain annuity and life contracts. When the Company purchases/sells option contracts at specific prices, it is required to pay/receive a premium to/from the counterparties. The amount of premium paid/received is based on the number of contracts purchased/sold, the specified price and the maturity date of the contract. The Company receives/pays cash equal to the premium of written/purchased options when the contract is established. If the option is exercised, the Company receives/pays cash equal to the product of the number of contracts and the specified price in the contract in exchange for the equity upon which the option is written/purchased. If the options are not exercised, then no additional cash is exchanged when the contract expires. Premiums paid are reported as a derivative asset and premiums received are reported as a derivative liability. Purchased put and call index option contracts are cash settled upon exercise and the gain or loss on the settlement is reported in net investment income. If the purchased option contract expires without being exercised, the premiums paid are reported as net investment income and the corresponding asset previously recorded is reversed. The change in the fair value of written option contracts is reported in Realized investment gains, net, with an adjustment to a corresponding liability. Written call index option contracts are cash settled upon exercise and the gain or loss on settlement is reported in Realized investment gains, net. | |
The Company has derivatives embedded in non-derivative host contracts that are required to be separated from the host contracts and accounted for at fair value. The Company’s embedded derivatives are equity options in life and annuity product contracts, which provide equity returns to contractholders, guaranteed minimum accumulation and withdrawal benefits in variable annuity contracts. The Company has reinsurance agreements to transfer all the risk related to guarantee minimum income, accumulation and withdrawal benefits in variable annuity contracts to third party reinsurers. None of these derivatives are designated as accounting hedging instruments and all are gross liabilities reported in policyholder account balances or future policy benefits and other policyholder liabilities. | |
Investment Income and Realized Gains and Losses | Investment Income and Realized Gains and Losses |
Investment income primarily consists of interest and is recognized on an accrual basis using the effective yield method. Interest income for RMBS and CMBS is determined considering estimated pay-downs, including prepayments, obtained from third party data sources and internal estimates. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the prepayments originally anticipated and the actual prepayments received and currently anticipated. For RMBS and CMBS of high credit quality with fixed interest rates, the effective yield is recalculated on a retrospective basis. For all others, the effective yield is recalculated on a prospective basis. Accrual of income is suspended for other-than-temporarily impaired fixed maturities when the timing and amount of cash flows expected to be received is not reasonably estimable. It is the Company’s policy to cease to carry accrued interest on commercial mortgage loans that are over 90 days delinquent. The Company held no non-income producing investments as of December 31, 2014. | |
Realized capital gains and losses include gains and losses on investment sales and write-downs in value due to other-than-temporary declines in fair value. Realized capital gains and losses on investment sales, including principal payments, are determined on a specific identification basis. | |
Recognition of Premium Revenues and Fees, and Related Policyholders' Benefits and Interest Credited | Recognition of Premium Revenues and Fees, and Related Policyholders’ Benefits and Interest Credited |
Prior to April 1, 2014 or the periods prior to April 1, 2014 (the “Predecessor Periods”), the Company had reinsurance agreements whereby all premiums, fee income from policyholders and returns credited to policyholders, policyholder benefits and substantially all expenses were ceded to ALIC and other reinsurers. Amounts reflected in the Statements of Operations and Comprehensive Income (Loss) are presented net of reinsurance. | |
Traditional life insurance products consist principally of products with fixed and guaranteed premiums and benefits, primarily term and whole life insurance products. Premiums from these products are recognized as revenue when due from policyholders. Surrender values on traditional life and death benefits are reflected in policyholder benefits. | |
Immediate annuities with life contingencies provide insurance protection over a period that extends beyond the period during which premiums are collected. Premiums from these products are recognized as revenue when received at the inception of the contract. Benefits and expenses are recognized in relation to premiums. As of April 1, 2014, the Company has reinsurance agreements to transfer all the risk related to immediate annuities. | |
Interest-sensitive life contracts, such as universal life and single premium life, are insurance contracts whose terms are not fixed or guaranteed. The terms that may be changed include premiums paid by the policyholder, interest credited to the policyholder account balance and contract charges assessed against the policyholder account balance. Premiums from these contracts are reported as policyholder account balances. Fee income from policyholders consist of fees assessed against the policyholder account balance for the cost of insurance (mortality risk), contract administration and surrender of the policy prior to contractually specified dates. These charges are recognized as revenue when assessed against the policyholder account balance. Policyholder benefits include life-contingent benefit payments in excess of the policyholder account balance. | |
Contracts that do not subject the Company to significant risk arising from mortality or morbidity are referred to as investment contracts. Fixed annuities, including market value adjusted annuities, equity-indexed annuities and immediate annuities without life contingencies, are considered investment contracts. Consideration received for such contracts is reported as policyholder account balance deposits. Policy fees for investment contracts consist of fees assessed against the contractholder account balance for maintenance, administration and surrender of the contract prior to contractually specified dates, and are recognized when assessed against the policyholder account balance. | |
Return credited to policyholder funds represents interest accrued or paid on interest-sensitive life and investment contracts. Crediting rates for certain fixed annuities and interest-sensitive life contracts are adjusted periodically by the Company to reflect current market conditions subject to contractually guaranteed minimum rates. Crediting rates for indexed life and annuities are generally based on an equity index, such as the Standard & Poor’s (“S&P”) 500 Index. | |
Policy charges for variable life and variable annuity products consist of fees assessed against the policyholder account balances for contract maintenance, administration, mortality, expense and surrender of the contract prior to contractually specified dates. Policy benefits incurred for variable annuity products include guaranteed minimum death, income, withdrawal and accumulation benefits. | |
The Company incurs significant costs in connection with renewal insurance business. All acquisition-related costs, including commissions, those related to general advertising, agent training, as well as all indirect costs, are expensed as incurred and reported in Operating and acquisition expenses on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the period from April 1, 2014 through December 31, 2014. The Company also receives expense allowances on reinsurance ceded. These amounts are recognized when earned and reported in Operating expenses and acquisition expenses on the Consolidated Statement of Operations and Comprehensive Income (Loss) for the period from April 1, 2014 through December 31, 2014. | |
Reinsurance | Reinsurance |
Reinsurance accounting is applied for ceded and assumed transactions when the risk transfer provisions of ASC 944-40, Accounting and Reporting for Reinsurance of Short-Duration and Long-Duration Contracts, have been met. To meet risk transfer requirements, a long-duration reinsurance contract must transfer mortality or morbidity risks, and subject the reinsurer to a reasonable possibility of a significant loss. Those contracts that do not meet risk transfer requirements are accounted for using deposit accounting. For short duration contracts, to meet risk transfer requirements the reinsurer must assume significant insurance risk and have a reasonable possibility of experiencing significant loss. | |
With respect to ceded reinsurance, the Company values reinsurance recoverables on reported claims at the time the underlying claim is recognized in accordance with contract terms. For future policy benefits, the Company estimates the amount of reinsurance recoverables based on the terms of the reinsurance contracts and historical reinsurance recovery information. The reinsurance recoverables are based on what the Company believes are reasonable estimates and the balance is reported as an asset in the Consolidated Balance Sheet (Successor) and Balance Sheets (Predecessor). However, the ultimate amount of the reinsurance recoverable is not known until all claims are settled. Reinsurance contracts do not relieve the Company from its obligations to policyholders, and failure of reinsurers to honor their obligations could result in losses to the Company; consequently, allowances are established for amounts deemed uncollectible. | |
In the Predecessor periods, or the periods prior to April 1, 2014, the Company had reinsurance agreements whereby all insurance risks represented by premiums, fee income from policyholders, returns credited to policyholder account balances, policyholder benefits and substantially all expenses were ceded to ALIC and other reinsurers. Additionally, investment income earned on the assets that supported policyholder account balances and future policy benefits and other policyholder funds were not included in the Company’s financial statements as those assets were owned and managed by ALIC and other reinsurers under the terms of the reinsurance agreements. | |
Value of Business Acquired ("VOBA") | Value of Business Acquired (“VOBA”) |
For interest sensitive life products, VOBA is amortized over the life of the policies in relation to the emergence of estimated gross profits (“EGP’s”) from margins on mortality, interest, expenses, and surrenders, all of which are net of reinsurance and include actual realized gains and losses on investments. For non-interest sensitive life products, such as term life insurance, VOBA is amortized in relation to premium. VOBA is reviewed periodically for loss recognition to ensure that the unamortized balance is recoverable from future earnings from the business. The carrying amount of VOBA is adjusted for the effects of realized and unrealized gains and losses on debt securities classified as AFS. | |
Separate Accounts | Separate Accounts |
Separate Accounts assets are carried at fair value. The assets of the Separate Accounts are legally segregated and available only to settle separate account contract obligations. Separate Account liabilities represent the contractholders’ claims to the related assets and are carried at an amount equal to the Separate Account assets. Investment income and realized capital gains and losses of the separate accounts accrue directly to the contractholders and therefore are not included in the Company’s Consolidated Statement of Operations and Comprehensive Income (Successor) or Statements of Operations and Comprehensive Income (Predecessor). Deposits to and surrenders and withdrawals from the Separate Accounts are reflected in Separate Accounts liabilities and are not included in cash flows. | |
Absent any contract provision wherein the Company provides a guarantee, variable annuity and variable life insurance contractholders bear the investment risk that the Separate Accounts’ funds may not meet their stated investment objectives. | |
Future Policy Benefit and Other Policyholder Liabilities | Future Policy Benefits and Other Policyholder Liabilities — Successor |
Policy liabilities are established for future policy benefits on certain annuity, life, and long term care policies. Such liabilities are established in amounts adequate to meet the estimated future obligations of policies in-force. Changes in policy and contract claims are recorded in policyholder benefits in the Consolidated Statement of Operations and Comprehensive Income (Loss). | |
For ASC 944-20 products, benefit reserves are computed using the net level premium method for individual life and annuity policies, and are based upon estimates as to future investment yield, mortality and lapse that include provisions for adverse deviation. Mortality, morbidity and lapse assumptions for all policies are based on the Company’s own experience and industry standards. | |
Liabilities for outstanding claims and claims adjustment expenses are estimates of payments to be made on life and health insurance contracts for reported claims and claims adjustment expenses. A liability is also held for claims adjustment expenses incurred but not reported as of the balance sheet date. These liabilities are determined using case basis evaluations and statistical analyses and represent estimates of the ultimate cost of all claims incurred but not paid. These estimates are continually reviewed and adjusted as necessary; such adjustments are reflected in current operations. | |
Future policy benefit reserves for the portion of fixed indexed annuity policies with returns linked to the performance of a specified market index are equal to the sum of the fair value of the embedded derivatives and the host (or guaranteed) component of the contracts. The change in the fair value of the embedded derivative is linked to the performance of the equity option. The host value is established as of the date of acquisition and is equal to the account value for which returns are linked to an equity index, plus the value of the unexpired options at the date of acquisition, less the embedded derivative, and accreted over the policy’s life at a constant rate of interest. Future policy benefits reserves for the portion of fixed indexed annuities earning a fixed rate of interest, and other deferred annuity products are computed under a retrospective deposit method and represent policy account balances before applicable surrender charges. | |
The Company holds additional liabilities for its no lapse guarantees (associated with universal life) and guaranteed minimum withdrawal benefits (associated with fixed indexed annuities). These are accounted for in accordance with ASC 944-20, Financial Services — Insurance Activities. | |
Policy liabilities and accruals are based on the various estimates discussed above. Although the adequacy of these amounts cannot be assured, the Company believes that policy liabilities and accruals will be sufficient to meet future obligations of policies in-force. The amount of liabilities and accruals, however, could be revised if the estimates discussed above are revised. | |
Policyholders' Account Balances | Policyholders’ Account Balances — Successor |
Policyholder account balances represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Policyholder funds primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. | |
The Company holds additional liabilities for guaranteed minimum income benefits (“GMIB”) associated with variable annuities, which are accounted for in accordance with ASC 944-20, Financial Services — Insurance Activities. The reserves for certain living benefit features, including guaranteed minimum accumulation benefits (“GMAB”) and guaranteed minimum withdrawal benefits (“GMWB”) are accounted for as embedded derivatives, with fair values calculated as the present value of expected future benefit payments to contractholders less the present value of assessed rider fees attributable to the embedded derivative feature. This methodology could result in either a liability or contra-liability balance, given changing capital market conditions and various actuarial assumptions. The Company’s GMIB, GMAB and GMWB reserves are ceded to external reinsurers. For additional information regarding the valuation of these optional living benefit features, see Note 10. | |
Income Taxes | Income Taxes — Successor |
Income taxes are provided for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial statement and income tax bases of assets and liabilities. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The realizability of deferred tax assets is assessed at each reporting date. Tax positions are assessed under a two-step approach, which requires the assessment of recognition and measurement. The Company reports interest expense related to income tax matters and tax penalties in other operating expenses in the Consolidated Statement of Operations and Comprehensive Income (Loss). | |
Other Long-Term Debt | Other Long-Term Debt |
Effective April 1, 2014, and with Nebraska Department of Insurance (the “NE DOI” or the “Department of Insurance”) approval, Lancaster Re issued a variable funding Surplus Note (the “Surplus Note”) to its affiliate, Lanis, LLC. for $513,000,000 and acquired from Lanis a Vehicle Note (the “Vehicle Note”) for $513,000,000. The Vehicle Note is held to support a portion of Lancaster Re’s reinsurance obligations and has been authorized as an acceptable form of reinsurance collateral pursuant to Nebraska Rev. Stat. §44-8216(8)(c)(i) which allows a special purpose financial captive insurer to establish any method of security that the Department deems acceptable. The scheduled maturity date of the Vehicle Note is April 1, 2034, and the scheduled maturity date of the Surplus Note is April 1, 2039, although each may be cancelled earlier or extended under certain conditions. The Surplus Note does not repay principal prior to maturity and principal payment at maturity is subject to the prior approval of the Department of Insurance. With pre-approval, the Surplus Note is increased each quarter with a corresponding increase in the Vehicle Note. With Department pre-approval, interest on the Surplus Note for the prior quarter is paid on the first day of each subsequent quarter at a rate consistent with the rate received on the Vehicle Note of 4%. The Surplus Note and Vehicle Note increased by $38,600,000 and interest expense of $15,711,000 was recognized in the Successor Period from April 1, 2014 through December 31, 2014. The Surplus Note is unsecured and subordinated to all present and future indebtedness, policy claims and other creditor claims of Lancaster Re. | |
Other Assets and Accrued Expenses and Other Liabilities | Other Assets and Accrued Expenses and Other Liabilities |
Other assets consist primarily of premiums due, intangible assets, the Vehicle Note, receivables resulting from sales of securities that had not yet settled at the balance sheet date. Other liabilities consist primarily of accrued expenses, technical overdrafts, derivatives, and payables resulting from purchases of securities that had not yet been settled at the balance sheet date. | |
Adoption of New Accounting Pronouncements | Adoption of New Accounting Pronouncements |
In February 2013, the Financial Accounting Standards Board issued guidance requiring expanded disclosures about the amounts reclassified out of accumulated other comprehensive income by component. The guidance requires the presentation of significant amounts reclassified out of accumulated other comprehensive income by income statement line item but only if the amount reclassified is required under accounting principles generally accepted in the United States of America (“GAAP”) to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under GAAP to be reclassified in their entirety to net income, cross-reference to other disclosures that provide additional detail about those amounts is required. The Company adopted the new guidance in 2013. The new guidance affects disclosures only and therefore had no impact on the Company’s results of operations or financial position. | |
Effective November 18, 2014, the Company adopted new guidance on when, if ever, the cost of acquiring an entity should be used to establish a new accounting basis (“pushdown”) in the acquired entity’s separate financial statements. The guidance provides an acquired entity and its subsidiaries with an irrevocable option to apply pushdown accounting in its separate financial statements upon occurrence of an event in which an acquirer obtains control of the acquired entity. If a reporting entity elects to apply pushdown accounting, its stand-alone financial statements would reflect the acquirer’s new basis in the acquired entity’s assets and liabilities. The election to apply pushdown accounting should be determined by an acquired entity for each individual change-in-control event in which an acquirer obtains control of the acquired entity; however, an entity that does not elect to apply pushdown accounting in the period of a change-in-control can later elect to retrospectively apply pushdown accounting to the most recent change-in-control transaction as a change in accounting principle. The Company has applied pushdown accounting as a result of the Acquisition in the Successor Period, as disclosed in Note 1. | |
In February 2015, the FASB issued updated guidance regarding consolidation. The pronouncement eliminates specialized guidance for limited partnerships and similar legal entities, and removes the indefinite deferral for certain investment funds. The new guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, with early adoption permitted. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | |
In January 2014, the FASB issued updated guidance regarding investments in flow-through limited liability entities that manage or invest in affordable housing projects that qualify for the low-income housing tax credit. Under the guidance, an entity is permitted to make an accounting policy election to amortize the initial cost of its investment in proportion to the tax credits and other tax benefits received and recognize the net investment performance in the Statement of Operations and Comprehensive Income (Loss) as a component of Income tax expense (benefit) if certain conditions are met. The new guidance is effective for annual periods and interim reporting periods within those annual periods, beginning after December 15, 2014, and should be applied retrospectively to all periods presented. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | |
In January 2014, the FASB issued updated guidance for troubled debt restructurings clarifying when an in substance repossession or foreclosure occurs, and when a creditor is considered to have received physical possession of residential real estate property collateralizing a consumer mortgage loan. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014. This guidance can be elected for prospective adoption or by using a modified retrospective transition method. This guidance is not expected to have a significant effect on the Company’s consolidated financial position, results of operations or financial statement disclosures. | |
In May 2014, the FASB issued updated guidance on accounting for revenue recognition. The guidance is based on the core principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods and services. The guidance also requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from cost incurred to obtain or fulfill a contract. Revenue recognition for insurance contracts is explicitly scoped out of the guidance. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2016 and must be applied using one of two retrospective application methods. Early adoption is not permitted. The Company is currently assessing the impact of the guidance on the Company’s consolidated financial position, results of operations and financial statement disclosures. | |
In August 2014, the FASB issued guidance requiring that mortgage loans be derecognized and that a separate other receivable be recognized upon foreclosure if certain conditions are met. Upon foreclosure, the separate other receivable should be measured based on the amount of the loan balance (principal and interest) expected to be recovered from the guarantor. The new guidance is effective for annual periods and interim periods within those annual periods, beginning after December 15, 2014, with early adoption permitted. This guidance can be adopted using either a prospective transition method or a modified retrospective transition method. This guidance is not expected to have a significant impact on the Company’s consolidated financial position, results of operations or financial statement disclosures. | |
Predecessor | |
Future Policy Benefit and Other Policyholder Liabilities | Future Policy Benefit and Other Policyholder Liabilities – Predecessor |
Future policy benefit and other policyholder liabilities consist of the reserve for life-contingent contract benefits payable under insurance policies, including traditional life insurance and life-contingent immediate annuities, and is computed on the basis of long-term actuarial assumptions of future investment yields, mortality, morbidity, policy terminations and expenses. These assumptions, which for traditional life insurance are applied using the net level premium method, include provisions for adverse deviation and generally vary by characteristics such as type of coverage, year of issue and policy duration. | |
Policyholders' Account Balances | Policyholders’ Account Balances — Predecessor |
Policyholder account balances represent interest-bearing liabilities arising from the sale of products such as interest-sensitive life insurance and fixed annuities. Policyholder account balances primarily comprise cumulative deposits received and interest credited to the contractholder less cumulative contract benefits, surrenders, withdrawals and contract charges for mortality or administrative expenses. Policyholder account balances also include reserves for secondary guarantees on interest-sensitive life insurance and certain fixed annuity contracts and reserves for certain guarantees on variable annuity contracts. | |
Income Taxes | Income Taxes — Predecessor |
The income tax provision is calculated under the liability method. Deferred tax assets and liabilities are recorded based on the difference between the financial statement and tax bases of assets and liabilities at the enacted tax rates. The principal assets and liabilities giving rise to such differences are unrealized capital gains and losses, accrued expenses and reinsurance recoverables. A deferred tax asset valuation allowance is established when there is uncertainty that such assets will be realized. |
General_Tables
General (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Fair Value of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of assets acquired and liabilities assumed as of April 1, 2014: | ||||
($ in thousands) | |||||
Assets | |||||
Fixed maturities | $ | 9,194,903 | |||
Commercial mortgage loans | 1,263,902 | ||||
Policy loans | 196,451 | ||||
Short-term investments | 979,728 | ||||
Other invested assets | 1,104 | ||||
Cash | 40,529 | ||||
Accrued investment income | 103,246 | ||||
Reinsurance recoverable | 5,606,879 | ||||
Value of business acquired | 290,795 | ||||
Deposit receivable | 1,550,351 | ||||
Intangibles | 5,200 | ||||
Other assets | 554,176 | ||||
Separate account assets | 1,661,007 | ||||
Total assets acquired | 21,448,271 | ||||
Liabilities | |||||
Future policy benefits and other policyholder liabilities | 6,682,833 | ||||
Policyholders’ account balances | 10,367,246 | ||||
Accrued expenses and other liabilities | 78,026 | ||||
Modified coinsurance payable | 1,550,351 | ||||
Other long-term debt — affiliate | 513,000 | ||||
Separate account liabilities | 1,661,007 | ||||
Total liabilities assumed | 20,852,463 | ||||
Net assets acquired | $ | 595,808 | |||
Investments_Tables
Investments (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||
Schedule for Fixed Income Securities at Amortized Cost, Gross Unrealized Gains and Losses and Fair Value | The amortized cost, gross unrealized gains and losses and fair value for fixed maturities as of December 31, 2014 and 2013 were as follows: | ||||||||||||||||||||||||||||
December 31, 2014 — Successor | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
($ in thousands) | Gains | Losses | |||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | 810,057 | $ | 47,859 | $ | (590 | ) | $ | 857,326 | ||||||||||||||||||||
Obligations of U.S. States and Political Subdivisions | 250,008 | 5,638 | (437 | ) | 255,209 | ||||||||||||||||||||||||
All other corporate securities | 7,279,391 | 132,480 | (34,126 | ) | 7,377,745 | ||||||||||||||||||||||||
ABS | 373,304 | 6,107 | (2,408 | ) | 377,003 | ||||||||||||||||||||||||
CMBS | 331,041 | 3,507 | (1,065 | ) | 333,483 | ||||||||||||||||||||||||
RMBS | 188,055 | 2,849 | (1,023 | ) | 189,881 | ||||||||||||||||||||||||
Total fixed maturities | $ | 9,231,856 | $ | 198,440 | $ | (39,649 | ) | $ | 9,390,647 | ||||||||||||||||||||
December 31, 2013 — Predecessor | Amortized | Gross | Gross | Fair Value | |||||||||||||||||||||||||
Cost | Unrealized | Unrealized | |||||||||||||||||||||||||||
($ in thousands) | Gains | Losses | |||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. government and agenciies | $ | 70,790 | $ | 3,113 | $ | (57 | ) | $ | 73,846 | ||||||||||||||||||||
Municipal | 2,499 | 270 | — | 2,769 | |||||||||||||||||||||||||
Corporate | 190,186 | 5,784 | (3,993 | ) | 191,977 | ||||||||||||||||||||||||
Foreign government | 4,999 | 165 | — | 5,164 | |||||||||||||||||||||||||
CMBS | 2,588 | 88 | — | 2,676 | |||||||||||||||||||||||||
RMBS | 13,866 | 584 | — | 14,450 | |||||||||||||||||||||||||
Total fixed maturities | $ | 284,928 | $ | 10,004 | $ | (4,050 | ) | $ | 290,882 | ||||||||||||||||||||
Schedule for Fixed Income Securities Based on Contractual Maturities | The scheduled maturities for fixed maturities are as follows as of December 31, 2014: | ||||||||||||||||||||||||||||
($ in thousands) | Amortized | Fair Value | |||||||||||||||||||||||||||
Cost | |||||||||||||||||||||||||||||
Due in one year or less | $ | 425,248 | $ | 425,238 | |||||||||||||||||||||||||
Due after one year through five years | 1,775,910 | 1,779,194 | |||||||||||||||||||||||||||
Due after five years through ten years | 4,001,723 | 4,060,017 | |||||||||||||||||||||||||||
Due after ten years | 2,136,575 | 2,225,831 | |||||||||||||||||||||||||||
Total before asset and mortgage-backed securities | 8,339,456 | 8,490,280 | |||||||||||||||||||||||||||
Asset and mortgage-backed securities | 892,400 | 900,367 | |||||||||||||||||||||||||||
Total fixed maturities | $ | 9,231,856 | $ | 9,390,647 | |||||||||||||||||||||||||
Schedule of Commercial Mortgage Loan Portfolio by Geographical Region | The Company diversifies its commercial mortgage loan portfolio by geographical region to reduce concentration risk. The following table presents the Company’s commercial mortgage loan portfolio by geographical region as of December 31, 2014: | ||||||||||||||||||||||||||||
($ in thousands) | Carrying | ||||||||||||||||||||||||||||
Value | |||||||||||||||||||||||||||||
Alabama | $ | 1,720 | |||||||||||||||||||||||||||
Arizona | 35,481 | ||||||||||||||||||||||||||||
California | 255,563 | ||||||||||||||||||||||||||||
Colorado | 22,381 | ||||||||||||||||||||||||||||
Florida | 20,779 | ||||||||||||||||||||||||||||
Georgia | 27,502 | ||||||||||||||||||||||||||||
Hawaii | 8,125 | ||||||||||||||||||||||||||||
Illinois | 53,174 | ||||||||||||||||||||||||||||
Iowa | 1,490 | ||||||||||||||||||||||||||||
Kentucky | 8,260 | ||||||||||||||||||||||||||||
Maine | 4,114 | ||||||||||||||||||||||||||||
Maryland | 35,536 | ||||||||||||||||||||||||||||
Massachusetts | 92,963 | ||||||||||||||||||||||||||||
Minnesota | 52,496 | ||||||||||||||||||||||||||||
Missouri | 9,324 | ||||||||||||||||||||||||||||
Nevada | 14,705 | ||||||||||||||||||||||||||||
New Jersey | 84,007 | ||||||||||||||||||||||||||||
New York | 72,625 | ||||||||||||||||||||||||||||
North Carolina | 31,111 | ||||||||||||||||||||||||||||
Ohio | 38,400 | ||||||||||||||||||||||||||||
Oklahoma | 10,835 | ||||||||||||||||||||||||||||
Pennsylvania | 37,688 | ||||||||||||||||||||||||||||
South Carolina | 3,130 | ||||||||||||||||||||||||||||
Tennessee | 5,719 | ||||||||||||||||||||||||||||
Texas | 103,778 | ||||||||||||||||||||||||||||
Utah | 45,914 | ||||||||||||||||||||||||||||
Virginia | 18,572 | ||||||||||||||||||||||||||||
Washington | 13,138 | ||||||||||||||||||||||||||||
Wisconsin | 6,637 | ||||||||||||||||||||||||||||
General allowance for loan loss | — | ||||||||||||||||||||||||||||
Total commercial mortgage loans | $ | 1,115,167 | |||||||||||||||||||||||||||
Schedule of Credit Quality of Commercial Mortgage Loans Held-For-Investment | The credit quality of commercial mortgage loans held-for-investment were as follows at December 31, 2014: | ||||||||||||||||||||||||||||
Recorded Investment | |||||||||||||||||||||||||||||
Debt Service Coverage Ratios | |||||||||||||||||||||||||||||
($ in thousands) | > 1.20x | 1.00x - 1.20x | < 1.00x | Total | % of Total | Estimated Fair | % of Total | ||||||||||||||||||||||
Value | |||||||||||||||||||||||||||||
Loan-to-value ratios: | |||||||||||||||||||||||||||||
Less than 65% | $ | 930,592 | $ | 151,700 | $ | 29,460 | $ | 1,111,752 | 98 | % | $ | 1,146,030 | 98 | % | |||||||||||||||
65% to 75% | 16,591 | 10,537 | — | 27,128 | 2 | 28,275 | 2 | ||||||||||||||||||||||
76% to 80% | — | — | — | — | — | — | — | ||||||||||||||||||||||
Greater than 80% | — | — | — | — | — | — | — | ||||||||||||||||||||||
Total | $ | 947,183 | $ | 162,237 | $ | 29,460 | $ | 1,138,880 | 100 | % | $ | 1,174,305 | 100 | % | |||||||||||||||
Composition of Other Invested Assets | The following table sets forth the composition of “Other invested assets” at December 31, 2014: | ||||||||||||||||||||||||||||
Successor | |||||||||||||||||||||||||||||
($ in thousands) | December 31, 2014 | ||||||||||||||||||||||||||||
Low income housing tax credit properties | $ | 896 | |||||||||||||||||||||||||||
Derivatives | 26,001 | ||||||||||||||||||||||||||||
$ | 26,897 | ||||||||||||||||||||||||||||
Schedule of Net Investment Income | Net investment income for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | ||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the Period | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | from January 1, | Ended | Ended | ||||||||||||||||||||||||||
through | 2014 | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | through March 31, | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | 2014 | ||||||||||||||||||||||||||||
Fixed maturities | $ | 231,972 | $ | 2,461 | $ | 11,545 | $ | 12,138 | |||||||||||||||||||||
Commercial mortgage loans | 49,417 | — | — | — | |||||||||||||||||||||||||
Cash and short-term investments | 4,786 | 16 | 23 | 20 | |||||||||||||||||||||||||
Other investment (loss) income | 7,353 | — | — | — | |||||||||||||||||||||||||
Gross investment income | 293,528 | 2,477 | 11,568 | 12,158 | |||||||||||||||||||||||||
Investment expenses | 4,957 | 127 | 633 | 568 | |||||||||||||||||||||||||
Net investment income | $ | 288,571 | $ | 2,350 | $ | 10,935 | $ | 11,590 | |||||||||||||||||||||
Schedule of Realized Investment Gains and Losses | Realized investment gains and losses for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | ||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the Period | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | from January 1, | Ended | Ended | ||||||||||||||||||||||||||
through | 2014 | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | through March 31, | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | 2014 | ||||||||||||||||||||||||||||
Realized investment gains, net | |||||||||||||||||||||||||||||
Fixed maturities | $ | 25,795 | $ | 285 | $ | — | $ | 626 | |||||||||||||||||||||
Commercial mortgage loans | 2,880 | — | — | — | |||||||||||||||||||||||||
Derivatives | 17,417 | — | — | — | |||||||||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||||||||
Net realized gains | $ | 46,092 | $ | 285 | $ | — | $ | 626 | |||||||||||||||||||||
Proceeds from Sale of Fixed Maturities and Gross Realized Investment Gains and Losses | Proceeds from sales of fixed maturities and gross realized investment gains and losses for the Successor Period from April 1, 2014 through December 31, 2014 and Predecessor Periods for the period from January 1, 2014 through March 31, 2014 and years ended December 31, 2013 and 2012 were as follows: | ||||||||||||||||||||||||||||
Successor | Predecessor | ||||||||||||||||||||||||||||
($ in thousands) | For the Period | For the | For the Year | For the Year | |||||||||||||||||||||||||
from April 1, 2014 | Period from | Ended | Ended | ||||||||||||||||||||||||||
through | January 1, | December 31, | December 31, | ||||||||||||||||||||||||||
December 31, | 2014 | 2013 | 2012 | ||||||||||||||||||||||||||
2014 | through | ||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||
Fixed maturities, available-for-sale | |||||||||||||||||||||||||||||
Proceeds from sales | $ | 1,429,177 | $ | 5,277 | $ | 9,170 | $ | 25,367 | |||||||||||||||||||||
Gross investment gains from sales | 30,403 | 317 | 3 | 645 | |||||||||||||||||||||||||
Gross investment losses from sales | (4,608 | ) | (32 | ) | (1 | ) | — | ||||||||||||||||||||||
Summary of Gross Unrealized Losses and Fair Value of Fixed Income by Length of Time | The following table summarizes the gross unrealized losses and fair value of fixed maturities by the length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2014 and 2013: | ||||||||||||||||||||||||||||
Successor | Less than 12 months | Greater than 12 months | |||||||||||||||||||||||||||
December 31, 2014 | Fair Value | Gross | Fair | Gross | Fair Value | Gross | |||||||||||||||||||||||
Unrealized | Value | Unrealized | Unrealized | ||||||||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | 71,766 | $ | (590 | ) | $ | — | $ | — | $ | 71,766 | $ | (590 | ) | |||||||||||||||
Obligations of U.S. States and Political Subdivisions | 37,543 | (437 | ) | — | — | 37,543 | (437 | ) | |||||||||||||||||||||
All other corporate securities | 1,683,185 | (34,126 | ) | — | — | 1,683,185 | (34,126 | ) | |||||||||||||||||||||
ABS | 115,568 | (2,408 | ) | — | — | 115,568 | (2,408 | ) | |||||||||||||||||||||
CMBS | 135,203 | (1,065 | ) | — | — | 135,203 | (1,065 | ) | |||||||||||||||||||||
RMBS | 92,804 | (1,023 | ) | — | — | 92,804 | (1,023 | ) | |||||||||||||||||||||
Total fixed income securities | $ | 2,136,069 | $ | (39,649 | ) | $ | — | $ | — | $ | 2,136,069 | $ | (39,649 | ) | |||||||||||||||
Predecessor | Less than 12 months | Greater than 12 months | |||||||||||||||||||||||||||
December 31, 2013 | Fair Value | Gross | Fair | Gross | Fair Value | Gross | |||||||||||||||||||||||
Unrealized | Value | Unrealized | Unrealized | ||||||||||||||||||||||||||
Losses | Losses | Losses | |||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||
U.S. government agencies | $ | 4,942 | $ | (57 | ) | $ | — | $ | — | $ | 4,942 | $ | (57 | ) | |||||||||||||||
Corporate | 75,754 | (3,795 | ) | 1,770 | (198 | ) | 77,524 | (3,993 | ) | ||||||||||||||||||||
Total fixed income securities | $ | 80,696 | $ | (3,852 | ) | $ | 1,770 | $ | (198 | ) | $ | 82,466 | $ | (4,050 | ) | ||||||||||||||
Net Unrealized Investment Gains and Losses in AOCI | Net Unrealized Investment Gains and Losses in Accumulated Other Comprehensive Income | ||||||||||||||||||||||||||||
($ in thousands) | Net Unrealized | VOBA | Future Policy | Deferred | Accumulated Other | ||||||||||||||||||||||||
Gain (Losses) on | Benefits and | Income Tax | Comprehensive | ||||||||||||||||||||||||||
Investments | Policyholders’ | (Liability) | Income (Loss) | ||||||||||||||||||||||||||
Account Balances | Asset | Related to Net | |||||||||||||||||||||||||||
Predecessor | Unrealized | ||||||||||||||||||||||||||||
Investment Gains | |||||||||||||||||||||||||||||
(Losses) | |||||||||||||||||||||||||||||
Balance, December 31, 2011 | $ | 20,855 | $ | — | $ | — | $ | (7,299 | ) | $ | 13,556 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | 977 | — | — | (343 | ) | 634 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 596 | — | — | (209 | ) | 387 | |||||||||||||||||||||||
Balance, December 31, 2012 | $ | 21,236 | $ | — | $ | — | $ | (7,433 | ) | $ | 13,803 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | (15,281 | ) | — | — | 5,349 | (9,932 | ) | ||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 1 | — | — | — | 1 | ||||||||||||||||||||||||
Balance, December 31, 2013 | $ | 5,954 | $ | — | $ | — | $ | (2,084 | ) | $ | 3,870 | ||||||||||||||||||
Net investment gains and losses on investments arising during the period | 2,364 | — | — | (828 | ) | 1,536 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | 285 | — | — | (100 | ) | 185 | |||||||||||||||||||||||
Balance, March 31, 2014 | $ | 8,033 | $ | — | $ | — | $ | (2,812 | ) | $ | 5,221 | ||||||||||||||||||
Successor | |||||||||||||||||||||||||||||
Balance, April 1, 2014 | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||
Net investment gains and losses on investments arising during the period | 159,261 | — | — | (55,674 | ) | 103,587 | |||||||||||||||||||||||
Reclassification adjustment for gains and losses included in net income | — | — | — | — | — | ||||||||||||||||||||||||
Impact of net unrealized investment gains and losses on VOBA | — | (20,287 | ) | — | 7,100 | (13,187 | ) | ||||||||||||||||||||||
Impact of net unrealized investment gains and losses on future policy benefits and policyholders’ account balances | — | — | (7,541 | ) | 2,639 | (4,902 | ) | ||||||||||||||||||||||
Balance, December 31, 2014 | $ | 159,261 | $ | (20,287 | ) | $ | (7,541 | ) | $ | (45,935 | ) | $ | 85,498 | ||||||||||||||||
Derivative_Financial_Instrumen1
Derivative Financial Instruments (Tables) | 12 Months Ended | ||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||
Summary of Notional and Fair Value Positions of Derivative Instruments | The following table provides a summary of the notional and fair value positions of derivative financial instruments as of December 31, 2014 and 2013: | ||||||||||||||||||||||||
($ in thousands) | Succesor | ||||||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||||||
Gross Fair Value | |||||||||||||||||||||||||
Primary Underlying | Notional | Assets | Liabilities | ||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Equity options | $ | 624 | $ | 68,776 | $ | (43,104 | ) | ||||||||||||||||||
Futures | 10 | 329 | — | ||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | |||||||||||||||||||||||||
Equity-indexed annuity contracts(3) | $ | 1,734,264 | $ | — | $ | (63,660 | ) | ||||||||||||||||||
Equity-indexed life contracts(3) | 347,610 | — | (18,720 | ) | |||||||||||||||||||||
Guaranteed accumulation benefits(1) | 120,714 | — | (6,367 | ) | |||||||||||||||||||||
Guaranteed withdrawal benefits(1) | 17,102 | — | (366 | ) | |||||||||||||||||||||
($ in thousands) | Predecessor | ||||||||||||||||||||||||
31-Dec-13 | |||||||||||||||||||||||||
Gross Fair Value | |||||||||||||||||||||||||
Primary Underlying | Notional | Assets | Liabilities | ||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | |||||||||||||||||||||||||
Equity-indexed and forward starting options in life and annuity product contracts(2) | 2,591,090 | — | (258,415 | ) | |||||||||||||||||||||
Guaranteed accumulation benefits(2) | 152,936 | — | (8,970 | ) | |||||||||||||||||||||
Guaranteed withdrawal benefits(2) | 22,199 | — | (474 | ) | |||||||||||||||||||||
-1 | As of April 1, 2014, these amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||
-2 | Prior to April 1, 2014, these amounts were ceded to ALIC or in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||
-3 | Amount represents account value of equity indexed contracts. | ||||||||||||||||||||||||
Amount and Location of Gains (Losses) Recognized in Income Net of Reinsurance for Derivatives Not Designated or Qualifying as Hedging Instruments | The following table presents the amount and location of gains (losses) recognized in income, net of reinsurance, for derivatives that were not designated or qualifying as hedging instruments for the Successor Period from April 1, 2014 through December 31, 2014: | ||||||||||||||||||||||||
Successor | |||||||||||||||||||||||||
($ in thousands) | For the Period from April 1, 2014 | ||||||||||||||||||||||||
through December 31, 2014 | |||||||||||||||||||||||||
Realized | Policyholder | ||||||||||||||||||||||||
Investment Gains | Benefits | ||||||||||||||||||||||||
(Losses) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Equity Options | $ | 15,230 | $ | — | |||||||||||||||||||||
Futures | $ | 2,187 | $ | — | |||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||
Equity-indexed annuity contracts | $ | — | $ | (5,622 | ) | ||||||||||||||||||||
Equity-indexed life contracts | 90 | ||||||||||||||||||||||||
The following table presents the amount and location of gains (losses) recognized in income for derivatives that were not designated or qualifying as hedging instruments for the Predecessor Periods from January 1, 2014 through March 31, 2014 and for the years ended December 31, 2013 and December 31, 2013: | |||||||||||||||||||||||||
($ in thousands) | Predecessor | ||||||||||||||||||||||||
For the Period from January 1, | For the Year Ended | For the Year Ended | |||||||||||||||||||||||
2014 through March 31, 2014 | December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||
Interest Credited(1) | Policyholder | Interest | Policyholder | Interest | Policyholder | ||||||||||||||||||||
Benefits (1) | Credited(1) | Benefits (1) | Credited(1) | Benefits (1) | |||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | 16,427 | $ | 946 | $ | 36,890 | $ | 10,177 | $ | 186,625 | $ | 5,126 | |||||||||||||
-1 | Prior to April 1, 2014, these amounts were ceded in accordance with the Company’s reinsurance agreements. |
Fair_Value_Tables
Fair Value (Tables) | 12 Months Ended | ||||||||||||||||||||||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||||||||||||||||||||||
Summary of Assets and Liabilities Measured at Fair Value on a Recurring and Non-Recurring Basis | The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2014. There are no assets or liabilities measured at fair value on a nonrecurring basis as of December 31, 2014. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||||||||||||||
Description for Each Class of Asset or Liability | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||
Assets at fair value | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities | |||||||||||||||||||||||||||||||||||||||||
U.S Treasury Securities and Obligations of U.S. Government Authority and Agencies | $ | — | $ | 857,326 | $ | — | $ | 857,326 | |||||||||||||||||||||||||||||||||
Obligations of U.S. States and Political Subdivisions | — | 255,209 | — | 255,209 | |||||||||||||||||||||||||||||||||||||
All Other Corporate Securities | — | 7,370,409 | 7,336 | 7,377,745 | |||||||||||||||||||||||||||||||||||||
ABS | — | 371,753 | 5,250 | 377,003 | |||||||||||||||||||||||||||||||||||||
CMBS | — | 330,790 | 2,693 | 333,483 | |||||||||||||||||||||||||||||||||||||
RMBS | — | 189,881 | — | 189,881 | |||||||||||||||||||||||||||||||||||||
Short term investments | 191,979 | 145,676 | 23,713 | 361,368 | |||||||||||||||||||||||||||||||||||||
Other invested assets | |||||||||||||||||||||||||||||||||||||||||
Equity Options | 25,672 | — | — | 25,672 | |||||||||||||||||||||||||||||||||||||
Futures | 329 | — | — | 329 | |||||||||||||||||||||||||||||||||||||
Separate accounts assets | 1,573,865 | — | — | 1,573,865 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 1,791,845 | $ | 9,521,044 | $ | 38,992 | $ | 11,351,881 | |||||||||||||||||||||||||||||||||
Liabilities at fair value | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances | |||||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | — | $ | — | $ | (63,660 | ) | $ | (63,660 | ) | |||||||||||||||||||||||||||||||
Equity indexed life contracts | — | (18,720 | ) | — | (18,720 | ) | |||||||||||||||||||||||||||||||||||
Guaranteed minimum accumulation benefits | — | — | (6,367 | ) | (6,367 | ) | |||||||||||||||||||||||||||||||||||
Guaranteed minimum withdrawal benefits | (366 | ) | (366 | ) | |||||||||||||||||||||||||||||||||||||
Separate accounts liabilities | (1,573,865 | ) | — | — | (1,573,865 | ) | |||||||||||||||||||||||||||||||||||
Total liabilites at fair value | $ | (1,573,865 | ) | $ | (18,720 | ) | $ | (70,393 | ) | $ | (1,662,978 | ) | |||||||||||||||||||||||||||||
Summary of Quantitative Information About the Significant Unobservable Inputs Used in Level 3 Fair Value Measurements | The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Fair | Valuation | Unobservable | Range | Weighted | ||||||||||||||||||||||||||||||||||||
Value | Technique | Input | Average | ||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | (63,660 | ) | Option Pricing Technique | Projected option cost | 1.40% - 1.93% | 1.50% | ||||||||||||||||||||||||||||||||||
Schedule of Rollforward of Level 3 Assets and Liabilities Held at Fair Value on a Recurring Basis | The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis from the period from April 1, 2014 through December 31, 2014: | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Balance | Net | OCI | Transfers | Transfers | Purchases | Sales | Issues | Settlements | Balance, | |||||||||||||||||||||||||||||||
as of | income | to Level 3 | out of | December 31, | |||||||||||||||||||||||||||||||||||||
April 1, | (loss) | Level 3 | 2014 | ||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed income securities | |||||||||||||||||||||||||||||||||||||||||
All other corporate securities | $ | 400,527 | $ | 6,693 | $ | (7,841 | ) | $ | — | $ | (291,802 | ) | $ | 4,930 | $ | (97,228 | ) | $ | — | $ | — | $ | 15,279 | ||||||||||||||||||
Short-term investments | $ | 24,095 | $ | 29 | $ | — | $ | — | $ | — | $ | — | $ | (411 | ) | $ | — | $ | — | $ | 23,713 | ||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Equity indexed annuity contracts | $ | (58,038 | ) | $ | (5,622 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (63,660 | ) | ||||||||||||||||||
Equity indexed life contracts | $ | (15,691 | ) | $ | (3,029 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (18,720 | ) | ||||||||||||||||||
Guaranteed minimium accumulation benefits and guaranteed minimum withdrawal benefits(1) | $ | (8,499 | ) | $ | 1,766 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (6,733 | ) | |||||||||||||||||||
-1 | These amount are 100% ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
Schedule of Carrying Value of Financial Instruments Presented in Consolidated Balance Sheet | The following table presents the carrying amount and fair value by fair value hierarchy level of certain financial instruments that are not reported at fair value. The financial instruments presented below are reported at carrying value on the Company’s Consolidated Balance Sheet; however, in some cases, as described below, the carrying amount equals or approximates fair value as of December 31, 2014. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | |||||||||||||||||||||||||||||||||||||||||
Description for Each Class of Asset or Liability | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Commercial mortgage loans | $ | — | $ | — | $ | 1,150,510 | $ | 1,150,510 | |||||||||||||||||||||||||||||||||
Policy loans | — | — | 194,385 | 194,385 | |||||||||||||||||||||||||||||||||||||
Cash | 49,730 | — | — | 49,730 | |||||||||||||||||||||||||||||||||||||
Vehicle note | — | — | 551,600 | 551,600 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 49,730 | $ | — | $ | 1,896,495 | $ | 1,946,225 | |||||||||||||||||||||||||||||||||
Liabilities at fair value | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances — investment contracts | $ | — | $ | — | $ | 6,609,253 | $ | 6,609,253 | |||||||||||||||||||||||||||||||||
Other long-term debt | — | — | 551,600 | 551,600 | |||||||||||||||||||||||||||||||||||||
$ | — | $ | — | $ | 7,160,853 | $ | 7,160,853 | ||||||||||||||||||||||||||||||||||
Predecessor | |||||||||||||||||||||||||||||||||||||||||
Summary of Assets and Liabilities Measured at Fair Value on a Recurring and Non-Recurring Basis | The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring basis as of December 31, 2013. There were no assets or liabilities measured at fair value on a non-recurring basis as of December 31, 2013. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Quoted | Significant | Significant | Balance as of | |||||||||||||||||||||||||||||||||||||
prices in | other | unobservable | December 31, | ||||||||||||||||||||||||||||||||||||||
active | observable | inputs | 2013 | ||||||||||||||||||||||||||||||||||||||
markets for | inputs | (Level 3) | |||||||||||||||||||||||||||||||||||||||
identical | (Level 2) | ||||||||||||||||||||||||||||||||||||||||
assets | |||||||||||||||||||||||||||||||||||||||||
(Level 1) | |||||||||||||||||||||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
U.S. government and agencies | $ | 27,520 | $ | 46,326 | $ | — | $ | 73,846 | |||||||||||||||||||||||||||||||||
Municipal | — | 2,769 | — | 2,769 | |||||||||||||||||||||||||||||||||||||
Corporate | — | 191,977 | — | 191,977 | |||||||||||||||||||||||||||||||||||||
Foreign government | — | 5,164 | — | 5,164 | |||||||||||||||||||||||||||||||||||||
RMBS | — | 14,450 | — | 14,450 | |||||||||||||||||||||||||||||||||||||
CMBS | — | 2,676 | — | 2,676 | |||||||||||||||||||||||||||||||||||||
Total fixed maturities | 27,520 | 263,362 | — | 290,882 | |||||||||||||||||||||||||||||||||||||
Short-term investments | 20,764 | 35,195 | — | 55,959 | |||||||||||||||||||||||||||||||||||||
Separate account assets | 1,700,566 | — | — | 1,700,566 | |||||||||||||||||||||||||||||||||||||
Total assets at fair value | $ | 1,748,850 | $ | 298,557 | $ | — | $ | 2,047,407 | |||||||||||||||||||||||||||||||||
% of total assets at fair value | 85.4 | % | 14.6 | % | — | % | 100 | % | |||||||||||||||||||||||||||||||||
Liabilities: | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (267,859 | ) | $ | (267,859 | ) | |||||||||||||||||||||||||||||||
Total liabilities at fair value | $ | — | $ | — | $ | (267,859 | ) | $ | (267,859 | ) | |||||||||||||||||||||||||||||||
% of total liabilities at fair value | — | % | — | % | 100 | % | 100 | % | |||||||||||||||||||||||||||||||||
Summary of Quantitative Information About the Significant Unobservable Inputs Used in Level 3 Fair Value Measurements | The following table summarizes quantitative information about the significant unobservable inputs used in Level 3 fair value measurements as of December 31, 2013: | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Fair Value | Valuation | Unobservable | Range | Weighted | ||||||||||||||||||||||||||||||||||||
Technique | Input | Average | |||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts — Equity-indexed and forward starting options | $ | (258,415 | ) | Stochastic cash | Projected option | 1.0 - 2.0% | 1.91% | ||||||||||||||||||||||||||||||||||
flow model | cost | ||||||||||||||||||||||||||||||||||||||||
Schedule of Rollforward of Level 3 Assets and Liabilities Held at Fair Value on a Recurring Basis | The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the period from January 1, 2014 through March 31, 2014. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2013 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (267,859 | ) | $ | 18,525 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (267,859 | ) | $ | 18,525 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of March 31, | |||||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (3,764 | ) | $ | 2,612 | $ | (250,486 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (3,764 | ) | $ | 2,612 | $ | (250,486 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $17.6 million in interest credited to contractholder funds and $946 thousand in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2013. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2012 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | 312 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | 312 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (314,926 | ) | $ | 43,244 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (314,926 | ) | $ | 43,244 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of December 31, | |||||||||||||||||||||||||||||||||||||||||
2013 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | — | $ | — | $ | — | $ | (312 | ) | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | — | $ | — | $ | — | $ | (312 | ) | $ | — | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (6,621 | ) | $ | 10,444 | $ | (267,859 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (6,621 | ) | $ | 10,444 | $ | (267,859 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $33.0 million in interest credited to contractholder funds and $10.2 million in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
The following table presents the rollforward of Level 3 assets and liabilities held at fair value on a recurring basis during the year ended December 31, 2012. | |||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Total gains (losses) | ||||||||||||||||||||||||||||||||||||||||
included in: | |||||||||||||||||||||||||||||||||||||||||
Balance as | Net | OCI | Transfers | Transfers | |||||||||||||||||||||||||||||||||||||
of December 31, | income(1) | into | out of | ||||||||||||||||||||||||||||||||||||||
2011 | Level 3 | Level 3 | |||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | 598 | $ | — | $ | — | $ | — | $ | — | |||||||||||||||||||||||||||||||
RMBS | 2,321 | — | — | — | (2,321 | ) | |||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | 2,919 | $ | — | $ | — | $ | — | $ | (2,321 | ) | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | (506,678 | ) | $ | 131,054 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | (506,678 | ) | $ | 131,054 | $ | — | $ | — | $ | — | ||||||||||||||||||||||||||||||
Purchases | Sales | Issues | Settlements | Balance as | |||||||||||||||||||||||||||||||||||||
of December 31, | |||||||||||||||||||||||||||||||||||||||||
2012 | |||||||||||||||||||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||||||||||||
Fixed maturities: | |||||||||||||||||||||||||||||||||||||||||
Corporate | $ | — | $ | — | $ | — | $ | (286 | ) | $ | 312 | ||||||||||||||||||||||||||||||
RMBS | — | — | — | — | — | ||||||||||||||||||||||||||||||||||||
Total recurring Level 3 assets | $ | — | $ | — | $ | — | $ | (286 | ) | $ | 312 | ||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | — | $ | — | $ | (11,024 | ) | $ | 71,722 | $ | (314,926 | ) | |||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | — | $ | — | $ | (11,024 | ) | $ | 71,722 | $ | (314,926 | ) | |||||||||||||||||||||||||||||
(1) | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $125.9 million in interest credited to contractholder funds and $5.1 million in contract benefits. These amounts were ceded in accordance with the Company’s reinsurance agreements. | ||||||||||||||||||||||||||||||||||||||||
Schedule of Change in Unrealized Gains and Losses Included in Net Income for Level 3 Assets and Liabilities Held | The following table provides the change in unrealized gains and losses included in net income for Level 3 assets and liabilities. | ||||||||||||||||||||||||||||||||||||||||
($ in thousands) | Period from | As of | As of | ||||||||||||||||||||||||||||||||||||||
January 1, | December 31, 2013 | December 31, 2012 | |||||||||||||||||||||||||||||||||||||||
2014 through | |||||||||||||||||||||||||||||||||||||||||
March 31, | |||||||||||||||||||||||||||||||||||||||||
2014 | |||||||||||||||||||||||||||||||||||||||||
Liabilities | |||||||||||||||||||||||||||||||||||||||||
Policyholders’ account balances: | |||||||||||||||||||||||||||||||||||||||||
Derivatives embedded in life and annuity contracts | $ | 18,525 | $ | 43,244 | $ | 131,054 | |||||||||||||||||||||||||||||||||||
Total recurring Level 3 liabilities | $ | 18,525 | $ | 43,244 | $ | 131,054 | |||||||||||||||||||||||||||||||||||
Reinsurance_Tables
Reinsurance (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Schedule of Effects of Reinsurance on Premiums and Contract Charges | The effects of reinsurance on premiums earned and fee income from policyholders for the Successor Period for the period April 1, 2014 through December 31, 2014 were as follows: | ||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Direct | $ | 921,444 | |||||||||||
Assumed | 5,258 | ||||||||||||
Ceded | (702,833 | ) | |||||||||||
Premiums and fee income, net of reinsurance | $ | 223,869 | |||||||||||
Schedule of Effects of Reinsurance on Interest Credited to Contractholder Funds, Contract Benefits and Expenses | The effects of reinsurance on return credited to policyholders’ account balances, policyholder benefits, and other expenses for the Successor Period for the period April 1, 2014 through December 31, 2014 were as follows: | ||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Direct | $ | 1,104,420 | |||||||||||
Assumed | 4,713 | ||||||||||||
Ceded | (635,887 | ) | |||||||||||
Return credited to policyholders’ account balances and policyholder benefits, net of reinsurance | $ | 473,246 | |||||||||||
Predecessor | |||||||||||||
Schedule of Effects of Reinsurance on Premiums and Contract Charges | The effects of reinsurance on premiums and contract charges are as follows: | ||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Direct | $ | 331,899 | $ | 1,331,597 | $ | 1,298,864 | |||||||
Assumed | 1,581 | 6,830 | 6,784 | ||||||||||
Ceded: | |||||||||||||
Affiliate | (244,797 | ) | (962,576 | ) | (908,459 | ) | |||||||
Non-affiliate | (88,683 | ) | (375,851 | ) | (397,189 | ) | |||||||
Premiums and fee income, net of reinsurance | $ | — | $ | — | $ | — | |||||||
Schedule of Effects of Reinsurance on Interest Credited to Contractholder Funds, Contract Benefits and Expenses | The effects of reinsurance on return credited to policyholders’ account balances, policyholder benefits and other expenses are as follows: | ||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Direct | $ | 450,041 | $ | 1,938,015 | $ | 1,882,714 | |||||||
Assumed | 2,606 | 8,180 | 9,167 | ||||||||||
Ceded: | |||||||||||||
Affiliate | (336,122 | ) | (1,505,010 | ) | (1,369,305 | ) | |||||||
Non-affiliate | (116,525 | ) | (441,185 | ) | (522,576 | ) | |||||||
Return credited to policyholders, contract benefits and expenses, net of reinsurance | $ | — | $ | — | $ | — | |||||||
Income_Taxes_Tables
Income Taxes (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Components of Deferred Income Tax Assets and Liabilities | The components of the deferred income tax assets and liabilities as of December 31, 2014 are as follows: | ||||||||||||
($ in thousands) | December 31, 2014 | ||||||||||||
Deferred tax assets | |||||||||||||
Policyholder reserves | $ | 2,057,627 | |||||||||||
Deferred acquisition costs | 24,850 | ||||||||||||
Premiums receivable | 8,197 | ||||||||||||
Net operating loss carryforward | 7,500 | ||||||||||||
Other assets | 38 | ||||||||||||
Total deferred tax assets | $ | 2,098,212 | |||||||||||
Deferred tax liabilities | |||||||||||||
Value of business acquired | $ | (81,032 | ) | ||||||||||
Amounts recoverable from reinsurers | (2,010,157 | ) | |||||||||||
Investments | (45,935 | ) | |||||||||||
Intangibles | (1,820 | ) | |||||||||||
Total deferred tax liabilities | $ | (2,138,944 | ) | ||||||||||
Net deferred tax liability | $ | (40,732 | ) | ||||||||||
Reconciliation of Statutory Federal Income Tax Rate to Effective Income Tax Rate | A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations for the Successor Period from April 1, 2014 through December 31, 2014 were as follows: | ||||||||||||
($ in thousands) | For the Period from | ||||||||||||
April 1, 2014 | |||||||||||||
Through December 31, | |||||||||||||
2014 | |||||||||||||
Expected federal income tax expense | $ | 15,722 | |||||||||||
Dividends received deduction | (1,470 | ) | |||||||||||
Other | (18 | ) | |||||||||||
Total income tax expense | $ | 14,234 | |||||||||||
Predecessor | |||||||||||||
Components of Deferred Income Tax Assets and Liabilities | The components of the deferred income tax assets and liabilities as of December 31 are as follows: | ||||||||||||
($ in thousands) | 2013 | ||||||||||||
Deferred assets | |||||||||||||
Reinsurance recoverables | $ | 497 | |||||||||||
Other assets | 4 | ||||||||||||
Total deferred assets | 501 | ||||||||||||
Deferred liabilities | |||||||||||||
Unrealized net capital gains | (2,084 | ) | |||||||||||
Accrued expenses | (981 | ) | |||||||||||
Other liabilities | — | ||||||||||||
Total deferred liabilities | (3,065 | ) | |||||||||||
Net deferred liability | $ | (2,564 | ) | ||||||||||
Reconciliation of Statutory Federal Income Tax Rate to Effective Income Tax Rate | A reconciliation of the statutory federal income tax rate to the effective income tax rate on income from operations is as follows: | ||||||||||||
Period from January 1, 2014 | 2013 | 2012 | |||||||||||
through March 31, 2014 | |||||||||||||
Statutory federal income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Other | — | — | — | ||||||||||
Effective income tax rate | 35 | % | 35 | % | 35 | % | |||||||
Components of Income Tax Expense | The components of income tax expense are as follows: | ||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Current | $ | 914 | $ | 3,902 | $ | 4,145 | |||||||
Deferred | 8 | (77 | ) | 128 | |||||||||
Total income tax expense | $ | 922 | $ | 3,825 | $ | 4,273 | |||||||
Future_Policy_Benefits_and_Oth1
Future Policy Benefits and Other Policyholder Liabilities (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Schedule of Future Policy Benefits and Other Policyholder Liabilities | Life insurance liabilities include reserves for death benefits and other policy benefits. As of December 31, 2014 and 2013, future policy benefits and other policyholder liabilities consisted of the following: | ||||||||||
Successor | Predecessor | ||||||||||
($ in thousands) | December 31, 2014 | December 31, 2013 | |||||||||
Traditional life insurance | $ | 1,492,438 | $ | 1,548,134 | |||||||
Immediate fixed annuities | 635,858 | 676,565 | |||||||||
Accident and health insurance | 1,462,110 | 1,324,268 | |||||||||
Equity indexed annuities | 1,895,889 | — | |||||||||
Other | 977,669 | 8,444 | |||||||||
Total | $ | 6,463,964 | $ | 3,557,411 | |||||||
Schedule of Key Assumptions Used In Calculation Reserve for Life-Contingent Contract Benefits | The following table highlights the key assumptions generally used in calculating the reserve for life-contingent contract benefits as of December 31, 2013: | ||||||||||
Product | Mortality | Interest rate | Estimation method | ||||||||
Traditional life insurance | Actual company experience plus loading | Interest rate assumptions range from 2.5% to 8.0% | Net level premium reserve method using the Company’s withdrawal experience rates; includes reserves for unpaid claims | ||||||||
Immediate | 1983 individual annuity mortality table with internal modifications; 1983 individual annuity mortality table; Annuity 2000 mortality table with internal modifications | Interest rate assumptions range from 0% to 8.8% | Present value of expected future benefits based on historical experience | ||||||||
fixed annuities | |||||||||||
Accident and health insurance | Actual company experience plus loading | Interest rate assumptions range from 4.0% to 5.3% | Unearned premium; additional contract reserves for mortality risk and unpaid claims | ||||||||
Other: | Annuity 2000 mortality table with internal modifications | Interest rate assumptions range from 4.0% to 5.8% | Projected benefit ratio applied to cumulative assessments | ||||||||
Variable annuity guaranteed minimum death benefits |
Policyholder_Account_Balances_
Policyholder Account Balances (Tables) | 12 Months Ended | ||||||||||
Dec. 31, 2014 | |||||||||||
Policyholder Account Balances | As of December 31, 2014 and 2013, policyholders’ account balances consisted of the following: | ||||||||||
Successor | Predecessor | ||||||||||
($ in thousands) | December 31, 2014 | December 31, 2013 | |||||||||
Interest-sensitive life contracts | $ | 5,008,094 | $ | 5,020,265 | |||||||
Individual annuities | 4,806,270 | 7,803,892 | |||||||||
Other | 14,973 | 299,958 | |||||||||
Total policyholders’ account balances | $ | 9,829,337 | $ | 13,124,115 | |||||||
Schedule of Contract Provisions Related to Policyholders' Account Balances | The following table highlights the key contract provisions relating to policyholders’ account balances: | ||||||||||
Product | Interest rate | Withdrawal/surrender charges | |||||||||
Interest-sensitive life insurance | Interest rates credited range from 0% to 10.0% for equity-indexed life (whose returns are indexed to the S&P 500) and 2.6% to 6.0% for all other products | Either a percentage of account balance or dollar amount grading off generally over 20 years | |||||||||
Fixed annuities | Interest rates credited range from 0% to 8.8% for immediate annuities; 0% to 7.0% for equity-indexed annuities (whose returns are indexed to the S&P 500); and 1.0% to 6.0% for all other products | Either a declining or a level percentage charge generally over ten years or less. Additionally, approximately 18.7% of fixed annuities are subject to market value adjustment for discretionary withdrawals. | |||||||||
Other investment contracts: | Interest rates used in establishing reserves range from 1.7% to 10.3% | Withdrawal and surrender charges are based on the terms of the related interest-sensitive life insurance or fixed annuity contract | |||||||||
Guaranteed minimum income, accumulation and withdrawal benefits on variable and fixed annuities and secondary guarantees on interest-sensitive life and fixed annuities |
Certain_Nontraditional_LongDur1
Certain Nontraditional Long-Duration Contracts (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2014 | |||||||||||||||||||||
Summary of Variable Annuity Contracts | As of December 31, 2014, the Company had the following guarantees associated with these contracts, by product and guarantee type: | ||||||||||||||||||||
Successor | |||||||||||||||||||||
December 31, 2014 | |||||||||||||||||||||
($ in millions) | In the Event of | At | For Cumulative | Accumulation | |||||||||||||||||
Death | Annuitization/ | Periodic Withdrawals | at Specified | ||||||||||||||||||
Accumulation(1) | Dates | ||||||||||||||||||||
Variable Annuity Contracts | |||||||||||||||||||||
Separate Account value | $ | 742.7 | $ | 151.9 | $ | 16.6 | $ | 118.4 | |||||||||||||
Net amount at risk | $ | 57.2 | $ | 15.2 | $ | 0.1 | $ | 6.2 | |||||||||||||
Average attained age of contractholders | 60 years | N/A | N/A | N/A | |||||||||||||||||
Weighted average waiting period until guarantee date | N/A | None | N/A | 6 years | |||||||||||||||||
Variable Life, Variable Universal Life and Universal Life Contracts | |||||||||||||||||||||
No Lapse Guarantees: | |||||||||||||||||||||
Separate Account value | $ | 325.1 | |||||||||||||||||||
General account value | $ | 31518.3 | |||||||||||||||||||
Net amount at risk | $ | 89,942.8 | |||||||||||||||||||
Average attained age of contractholders | 51 years | ||||||||||||||||||||
As of December 31, 2013, the Company had the following guarantees associated with these contracts, by product and guarantee type: | |||||||||||||||||||||
Predecessor | |||||||||||||||||||||
December 31, 2013 | |||||||||||||||||||||
($ in millions) | In the Event of | At | For Cumulative | Accumulation | |||||||||||||||||
Death | Annuitization/ | Periodic Withdrawals | at Specified | ||||||||||||||||||
Accumulation(1) | Dates | ||||||||||||||||||||
Variable Annuity Contracts | |||||||||||||||||||||
Separate Account value | $ | 877 | $ | 170.5 | $ | 21.8 | $ | 151.1 | |||||||||||||
Net amount at risk | $ | 63.2 | $ | 16.6 | $ | 0.1 | $ | 7.3 | |||||||||||||
Average attained age of contractholders | 59 years | N/A | N/A | N/A | |||||||||||||||||
Weighted average waiting period until guarantee date | N/A | None | N/A | 6 years | |||||||||||||||||
Liabilities for Guarantee Benefits | In the Predecessor Period, secondary guarantees on interest-sensitive life and fixed annuities are included in policyholders’ account balances. Guaranteed minimum income benefits (“GMIB”), guaranteed minimum withdrawal benefits (“GMWB”) and guaranteed minimum accumulation benefits (“GMAB”) features are accounted for as bifurcated embedded derivatives and are recorded at fair value within Policyholders’ account balances on the Consolidated Balance Sheet (Successor). | ||||||||||||||||||||
GMDB | GMIB | GMWB/ | Secondary | ||||||||||||||||||
GMAB | Guarantees | ||||||||||||||||||||
($ in thousands) | Variable | Variable | Variable | Interest- | Total | ||||||||||||||||
Annuity | Annuity | Annuity | Sensitive | ||||||||||||||||||
Life and | |||||||||||||||||||||
Fixed | |||||||||||||||||||||
Annuities | |||||||||||||||||||||
Predecessor | |||||||||||||||||||||
Balance as of December 21, 2012 | $ | 9,390 | $ | 19,484 | $ | 19,621 | $ | 200,688 | $ | 249,183 | |||||||||||
Less: reinsurance recoverable | 9,390 | 19,484 | 19,621 | 200,688 | 249,183 | ||||||||||||||||
Net balance as of December 31, 2012 | — | — | — | — | — | ||||||||||||||||
Incurred guarantee benefits | — | — | — | — | — | ||||||||||||||||
Paid guarantee benefits | — | — | — | — | — | ||||||||||||||||
Net change | — | — | — | — | — | ||||||||||||||||
Net balance as of December 31, 2013 | — | — | — | — | — | ||||||||||||||||
Plus reinsurance recoverable | 8,444 | 8,743 | 9,444 | 281,771 | 308,402 | ||||||||||||||||
Balance as of December 31, 2013 | $ | 8,444 | $ | 8,743 | $ | 9,444 | $ | 281,771 | $ | 308,402 | |||||||||||
Less: reinsurance recoverable | 8,444 | 8,743 | 9,444 | 281,771 | 308,402 | ||||||||||||||||
Net balance as of December 31, 2013 | — | — | — | — | — | ||||||||||||||||
Incurred guarantee benefits | — | — | — | — | — | ||||||||||||||||
Paid guarantee benefits | — | — | — | — | — | ||||||||||||||||
Net change | — | — | — | — | — | ||||||||||||||||
Net balance as of March 31, 2014 | — | — | — | — | — | ||||||||||||||||
Plus reinsurance recoverable | 8,057 | 7,122 | 8,499 | 293,704 | 317,382 | ||||||||||||||||
Balance as of March 31, 2014 | $ | 8,057 | $ | 7,122 | $ | 8,499 | $ | 293,704 | $ | 317,382 | |||||||||||
Successor | |||||||||||||||||||||
Balance as of April 1, 2014 | $ | 8,057 | $ | 7,122 | $ | 8,499 | $ | 552,163 | $ | 575,841 | |||||||||||
Less: reinsurance recoverable | 8,057 | 7,122 | 8,499 | 67,288 | 90,966 | ||||||||||||||||
Net balance as of April 1, 2014 | — | — | — | 484,875 | 484,875 | ||||||||||||||||
Incurred guarantee benefits | — | — | — | 159,104 | 159,104 | ||||||||||||||||
Paid guarantee benefits | — | — | — | (108,252 | ) | (108,252 | ) | ||||||||||||||
Net change | — | — | — | 50,852 | 50,852 | ||||||||||||||||
Net balance as of December 31, 2014 | — | — | — | 535,727 | 535,727 | ||||||||||||||||
Plus reinsurance recoverable | 8,358 | 8,240 | 6,733 | 83,733 | 107,064 | ||||||||||||||||
Balance as of December 31, 2014 | $ | 8,358 | $ | 8,240 | $ | 6,733 | $ | 619,460 | $ | 642,791 | |||||||||||
Value_of_Business_Acquired_Tab
Value of Business Acquired (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Changes to Value of Business Acquired | The following reflects the changes to the VOBA asset: | ||||
($ in thousands) | For the Period from | ||||
April 1, 2014 | |||||
Through December 31, | |||||
2014 | |||||
Balance at beginning of period | $ | 290,795 | |||
Business acquired | — | ||||
Amortized to expense during the year(1) | (38,987 | ) | |||
Adjustment for unrealized investment gains during the year | (20,287 | ) | |||
Balance at end of year | $ | 231,521 | |||
-1 | Amount is included in Other Expenses on the Consolidated Statement of Operations and Other Comprehensive Income (Loss) | ||||
Estimated Percentage of VOBA Balance to Be Amortized | The following table provides estimated percentage of the VOBA balance to be amortized for the years indicated: | ||||
VOBA | |||||
Amortization | |||||
2015 | 14 | % | |||
2016 | 13 | % | |||
2017 | 11 | % | |||
2018 | 9 | % | |||
2019 and thereafter | 53 | % |
Leases_Tables
Leases (Tables) | 12 Months Ended | ||||
Dec. 31, 2014 | |||||
Minimum Aggregate Rental Commitments | The minimum aggregate rental commitments as of December 31, 2014 were as follows: | ||||
(in thousands) | |||||
2015 | $ | 97 | |||
2016 | 194 | ||||
2017 | 207 | ||||
2018 | 212 | ||||
2019 | 217 | ||||
All future years | 1,712 | ||||
Aggregate total | $ | 2,639 | |||
Related_Parties_Tables
Related Parties (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2014 | |||||||||||||
Receivables/ (Payables) to Affiliates | The Company reported the following receivables/ (payables) to affiliates as of December 31, 2014: | ||||||||||||
Resolution | $ | (4,509,447 | ) | ||||||||||
Lanis | $ | (1,563,783 | ) | ||||||||||
Predecessor | |||||||||||||
Schedule of Ceded Reinsurance Agreements Reported in Statements of Operations and Comprehensive Income | The following table summarizes amounts that were ceded to ALIC under reinsurance agreements and reported net in the Statements of Operations and Comprehensive Income. | ||||||||||||
($ in thousands) | Period from January 1, 2014 | 2013 | 2012 | ||||||||||
through March 31, 2014 | |||||||||||||
Premiums and contract charges | $ | 244,797 | $ | 962,576 | $ | 908,459 | |||||||
Interest credited to contractholder funds, contract benefits and expenses | 336,122 | 1,505,010 | 1,369,305 |
General_Additional_Information
General - Additional Information (Detail) (USD $) | 0 Months Ended | |
Apr. 01, 2014 | Jul. 17, 2013 | |
Organization and Summary of Significant Accounting Policies Disclosure [Line Items] | ||
Initial purchase price, subject to closing adjustments | $595,800,000 | |
Ownership interest acquired | 100.00% | |
Increase in assets | 1,330,000,000 | |
Increase in liabilities | $190,000,000 |
Fair_Value_of_Assets_Acquired_
Fair Value of Assets Acquired and Liabilities Assumed (Detail) (USD $) | Apr. 01, 2014 |
In Thousands, unless otherwise specified | |
Assets | |
Fixed maturities | $9,194,903 |
Commercial mortgage loans | 1,263,902 |
Policy loans | 196,451 |
Short-term investments | 979,728 |
Other invested assets | 1,104 |
Cash | 40,529 |
Accrued investment income | 103,246 |
Reinsurance recoverable | 5,606,879 |
Value of business acquired | 290,795 |
Deposit receivable | 1,550,351 |
Intangibles | 5,200 |
Other assets | 554,176 |
Separate account assets | 1,661,007 |
Total assets acquired | 21,448,271 |
Liabilities | |
Future policy benefits and other policyholder liabilities | 6,682,833 |
Policyholders' account balances | 10,367,246 |
Accrued expenses and other liabilities | 78,026 |
Modified coinsurance payable | 1,550,351 |
Other long-term debt - affiliate | 513,000 |
Separate account liabilities | 1,661,007 |
Total liabilities assumed | 20,852,463 |
Net assets acquired | $595,808 |
Significant_Accounting_Policie1
Significant Accounting Policies - Additional Information (Detail) (USD $) | 9 Months Ended | |
Dec. 31, 2014 | Apr. 01, 2014 | |
Summary Of Significant Accounting Policies [Line Items] | ||
Increase in surplus note | $38,600,000 | |
Increase in vehicle note | 38,600,000 | |
Interest rate on surplus note | 4.00% | |
Interest expense on surplus note | 15,711,000 | |
Lancaster | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Surplus note re issued | 513,000,000 | |
Other Assets | Lancaster | ||
Summary Of Significant Accounting Policies [Line Items] | ||
Vehicle Note acquired | 513,000,000 |
Schedule_for_Fixed_Income_Secu
Schedule for Fixed Income Securities at Amortized Cost, Gross Unrealized Gains and Losses and Fair Value (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | $9,231,856 | |
Gross Unrealized Gains | 198,440 | |
Gross Unrealized Losses | -39,649 | |
Fair Value | 9,390,647 | |
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 810,057 | |
Gross Unrealized Gains | 47,859 | |
Gross Unrealized Losses | -590 | |
Fair Value | 857,326 | |
Obligations of U.S. States and Political Subdivisions | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 250,008 | |
Gross Unrealized Gains | 5,638 | |
Gross Unrealized Losses | -437 | |
Fair Value | 255,209 | |
All other corporate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 7,279,391 | |
Gross Unrealized Gains | 132,480 | |
Gross Unrealized Losses | -34,126 | |
Fair Value | 7,377,745 | |
Asset-backed securities ("ABS") | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 373,304 | |
Gross Unrealized Gains | 6,107 | |
Gross Unrealized Losses | -2,408 | |
Fair Value | 377,003 | |
Commercial mortgage-backed securities ("CMBS") | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 331,041 | |
Gross Unrealized Gains | 3,507 | |
Gross Unrealized Losses | -1,065 | |
Fair Value | 333,483 | |
Residential mortgage-backed securities ("RMBS") | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 188,055 | |
Gross Unrealized Gains | 2,849 | |
Gross Unrealized Losses | -1,023 | |
Fair Value | 189,881 | |
Predecessor | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 284,928 | |
Gross Unrealized Gains | 10,004 | |
Gross Unrealized Losses | -4,050 | |
Fair Value | 290,882 | |
Predecessor | All other corporate securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 190,186 | |
Gross Unrealized Gains | 5,784 | |
Gross Unrealized Losses | -3,993 | |
Fair Value | 191,977 | |
Predecessor | Commercial mortgage-backed securities ("CMBS") | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,588 | |
Gross Unrealized Gains | 88 | |
Fair Value | 2,676 | |
Predecessor | Residential mortgage-backed securities ("RMBS") | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 13,866 | |
Gross Unrealized Gains | 584 | |
Fair Value | 14,450 | |
Predecessor | United States Government, Government Agencies and Authorities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 70,790 | |
Gross Unrealized Gains | 3,113 | |
Gross Unrealized Losses | -57 | |
Fair Value | 73,846 | |
Predecessor | Municipal | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 2,499 | |
Gross Unrealized Gains | 270 | |
Fair Value | 2,769 | |
Predecessor | Foreign government | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Amortized Cost | 4,999 | |
Gross Unrealized Gains | 165 | |
Fair Value | $5,164 |
Schedule_for_Fixed_Income_Secu1
Schedule for Fixed Income Securities Based on Contractual Maturities (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Amortized cost | |
Due in one year or less | $425,248 |
Due after one year through five years | 1,775,910 |
Due after five years through ten years | 4,001,723 |
Due after ten years | 2,136,575 |
Total before asset and mortgage-backed securities | 8,339,456 |
Asset and mortgage-backed securities | 892,400 |
Amortized Cost | 9,231,856 |
Fair value | |
Due in one year or less | 425,238 |
Due after one year through five years | 1,779,194 |
Due after five years through ten years | 4,060,017 |
Due after ten years | 2,225,831 |
Total before asset and mortgage-backed securities | 8,490,280 |
Asset and mortgage-backed securities | 900,367 |
Total fixed maturities | $9,390,647 |
Schedule_of_Commercial_Mortgag
Schedule of Commercial Mortgage Loan Portfolio by Geographical Region (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | $1,115,167 |
General allowance for loan loss | 0 |
Total commercial mortgage loans | 1,115,167 |
ALABAMA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 1,720 |
ARIZONA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 35,481 |
CALIFORNIA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 255,563 |
COLORADO | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 22,381 |
FLORIDA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 20,779 |
GEORGIA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 27,502 |
HAWAII | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 8,125 |
ILLINOIS | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 53,174 |
IOWA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 1,490 |
KENTUCKY | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 8,260 |
MAINE | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 4,114 |
MARYLAND | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 35,536 |
MASSACHUSETTS | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 92,963 |
MINNESOTA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 52,496 |
MISSOURI | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 9,324 |
NEVADA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 14,705 |
NEW JERSEY | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 84,007 |
NEW YORK | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 72,625 |
NORTH CAROLINA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 31,111 |
OHIO | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 38,400 |
OKLAHOMA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 10,835 |
PENNSYLVANIA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 37,688 |
SOUTH CAROLINA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 3,130 |
TENNESSEE | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 5,719 |
TEXAS | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 103,778 |
UTAH | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 45,914 |
VIRGINIA | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 18,572 |
Washington | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | 13,138 |
WISCONSIN | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Carrying Value | $6,637 |
Schedule_of_Credit_Quality_of_
Schedule of Credit Quality of Commercial Mortgage Loans Held-For-Investment (Detail) (Commercial Mortgage Loans, USD $) | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | $1,138,880 |
Estimated Fair Value | 1,174,305 |
Recorded Investment, % of Total | 100.00% |
Estimated Fair Value, % of Total | 100.00% |
Debt Service Coverage Ratio >1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 947,183 |
Debt Service Coverage Ratio 1.00x - 1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 162,237 |
Debt Service Coverage Ratio Less than 1.00x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 29,460 |
Loan To Value Ratio Less Than 65% | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 1,111,752 |
Estimated Fair Value | 1,146,030 |
Recorded Investment, % of Total | 98.00% |
Estimated Fair Value, % of Total | 98.00% |
Loan To Value Ratio Less Than 65% | Debt Service Coverage Ratio >1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 930,592 |
Loan To Value Ratio Less Than 65% | Debt Service Coverage Ratio 1.00x - 1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 151,700 |
Loan To Value Ratio Less Than 65% | Debt Service Coverage Ratio Less than 1.00x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 29,460 |
Loan To Value Ratio 65% to 75% | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 27,128 |
Estimated Fair Value | 28,275 |
Recorded Investment, % of Total | 2.00% |
Estimated Fair Value, % of Total | 2.00% |
Loan To Value Ratio 65% to 75% | Debt Service Coverage Ratio >1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | 16,591 |
Loan To Value Ratio 65% to 75% | Debt Service Coverage Ratio 1.00x - 1.20x | |
Financing Receivable, Recorded Investment [Line Items] | |
Recorded Investment | $10,537 |
Investments_Additional_Informa
Investments - Additional Information (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Schedule of Investments [Line Items] | ||||
Commercial Mortgage Loan | $1,138,880,000 | |||
Other-than-temporary impairment losses included in accumulated other comprehensive income | 0 | |||
Commercial Mortgage Loans | ||||
Schedule of Investments [Line Items] | ||||
Allowance for credit losses | 0 | |||
Impaired loans | 0 | |||
Commitments to fund borrowers troubled debt restructuring | 0 | |||
Residential mortgage-backed securities ("RMBS") | ||||
Schedule of Investments [Line Items] | ||||
Other-than-temporary impairment losses | 0 | |||
Predecessor | Residential mortgage-backed securities ("RMBS") | ||||
Schedule of Investments [Line Items] | ||||
Other-than-temporary impairment losses | 0 | 2,000 | 19,000 | |
Other-than-temporary impairment losses included in accumulated other comprehensive income | $0 |
Other_Invested_Assets_Detail
Other Invested Assets (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Schedule of Investments [Line Items] | |
Other invested assets | $26,897 |
Low Income Housing Tax Credit Properties | |
Schedule of Investments [Line Items] | |
Other invested assets | 896 |
Derivative | |
Schedule of Investments [Line Items] | |
Other invested assets | $26,001 |
Schedule_of_Net_Investment_Inc
Schedule of Net Investment Income (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | $293,528 | |||
Investment expenses | 4,957 | |||
Net investment income | 288,571 | |||
Fixed income securities | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 231,972 | |||
Commercial Mortgage Loans | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 49,417 | |||
Cash And Short Term Investments | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 4,786 | |||
Other investment (loss) income | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 7,353 | |||
Predecessor | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 2,477 | 11,568 | 12,158 | |
Investment expenses | 127 | 633 | 568 | |
Net investment income | 2,350 | 10,935 | 11,590 | |
Predecessor | Fixed income securities | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | 2,461 | 11,545 | 12,138 | |
Predecessor | Cash And Short Term Investments | ||||
Schedule of Investment Income, Reported Amounts, by Category [Line Items] | ||||
Investment income, before expense | $16 | $23 | $20 |
Schedule_of_Realized_Investmen
Schedule of Realized Investment Gains and Losses (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2012 |
Investment Realized gains (losses) | |||
Net realized gains | $46,092 | ||
Fixed income securities | |||
Investment Realized gains (losses) | |||
Net realized gains | 25,795 | ||
Commercial Mortgage Loans | |||
Investment Realized gains (losses) | |||
Net realized gains | 2,880 | ||
Derivative | |||
Investment Realized gains (losses) | |||
Net realized gains | 17,417 | ||
Predecessor | |||
Investment Realized gains (losses) | |||
Net realized gains | 285 | 626 | |
Predecessor | Fixed income securities | |||
Investment Realized gains (losses) | |||
Net realized gains | $285 | $626 |
Proceeds_from_Sale_of_Fixed_Ma
Proceeds from Sale of Fixed Maturities and Gross Realized Investment Gains and Losses (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Schedule of Investments [Line Items] | ||||
Fixed maturities, available-for-sale Proceeds from sales | $1,429,177 | |||
Fixed maturities, available-for-sale, Gross investment gains from sales | 30,403 | |||
Fixed maturities, available-for-sale, Gross investment losses from sales | -4,608 | |||
Predecessor | ||||
Schedule of Investments [Line Items] | ||||
Fixed maturities, available-for-sale Proceeds from sales | 5,277 | 9,170 | 25,367 | |
Fixed maturities, available-for-sale, Gross investment gains from sales | 317 | 3 | 645 | |
Fixed maturities, available-for-sale, Gross investment losses from sales | ($32) | ($1) |
Summary_of_Gross_Unrealized_Lo
Summary of Gross Unrealized Losses and Fair Value of Fixed Maturities by Length of Time (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | $2,136,069 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -39,649 | |
Fair Value | 2,136,069 | |
Gross Unrealized Losses | -39,649 | |
Predecessor | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 80,696 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -3,852 | |
Fair value, continuous unrealized loss position for Greater 12 months | 1,770 | |
Gross Unrealized losses, continuous unrealized loss position for Greater than 12 months | -198 | |
Fair Value | 82,466 | |
Gross Unrealized Losses | -4,050 | |
U.S. Treasury Securities and Obligations of U.S. Government Authority and Agencies | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 71,766 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -590 | |
Fair Value | 71,766 | |
Gross Unrealized Losses | -590 | |
Obligations of U.S. States and Political Subdivisions | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 37,543 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -437 | |
Fair Value | 37,543 | |
Gross Unrealized Losses | -437 | |
All other corporate securities | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 1,683,185 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -34,126 | |
Fair Value | 1,683,185 | |
Gross Unrealized Losses | -34,126 | |
All other corporate securities | Predecessor | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 75,754 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -3,795 | |
Fair value, continuous unrealized loss position for Greater 12 months | 1,770 | |
Gross Unrealized losses, continuous unrealized loss position for Greater than 12 months | -198 | |
Fair Value | 77,524 | |
Gross Unrealized Losses | -3,993 | |
Asset-backed securities ("ABS") | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 115,568 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -2,408 | |
Fair Value | 115,568 | |
Gross Unrealized Losses | -2,408 | |
Commercial mortgage-backed securities ("CMBS") | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 135,203 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -1,065 | |
Fair Value | 135,203 | |
Gross Unrealized Losses | -1,065 | |
Residential mortgage-backed securities ("RMBS") | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 92,804 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -1,023 | |
Fair Value | 92,804 | |
Gross Unrealized Losses | -1,023 | |
United States Government, Government Agencies and Authorities | Predecessor | ||
Schedule of Investments [Line Items] | ||
Fair value, continuous unrealized loss position for less than 12 months | 4,942 | |
Unrealized losses, continuous unrealized loss position for less than 12 months | -57 | |
Fair Value | 4,942 | |
Gross Unrealized Losses | ($57) |
Net_Unrealized_Investment_Gain
Net Unrealized Investment Gains and Losses in Accumulated other Comprehensive Income (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Net Unrealized Gains Losses on Investment Securities | ||||
Schedule of Investments [Line Items] | ||||
Net investment gains and losses on investments arising during the period | $159,261 | |||
Balance | 159,261 | |||
Value of Business Acquired | ||||
Schedule of Investments [Line Items] | ||||
Impact of net unrealized investment gains and losses on VOBA | -20,287 | |||
Balance | -20,287 | |||
Future Policy Benefits and Policyholders' Account Balances | ||||
Schedule of Investments [Line Items] | ||||
Impact of net unrealized investment gains and losses on future policy benefits and policyholders' account balances | -7,541 | |||
Balance | -7,541 | |||
Deferred Income Tax (Liability) Asset | ||||
Schedule of Investments [Line Items] | ||||
Net investment gains and losses on investments arising during the period | -55,674 | |||
Impact of net unrealized investment gains and losses on VOBA | 7,100 | |||
Impact of net unrealized investment gains and losses on future policy benefits and policyholders' account balances | 2,639 | |||
Balance | -45,935 | |||
Accumulated Net Unrealized Investment Gain (Loss) | ||||
Schedule of Investments [Line Items] | ||||
Net investment gains and losses on investments arising during the period | 103,587 | |||
Impact of net unrealized investment gains and losses on VOBA | -13,187 | |||
Impact of net unrealized investment gains and losses on future policy benefits and policyholders' account balances | -4,902 | |||
Balance | 85,498 | |||
Predecessor | Net Unrealized Gains Losses on Investment Securities | ||||
Schedule of Investments [Line Items] | ||||
Balance | 5,954 | 21,236 | 20,855 | |
Net investment gains and losses on investments arising during the period | 2,364 | -15,281 | 977 | |
Reclassification adjustment for gains and losses included in net income | 285 | 1 | 596 | |
Balance | 8,033 | 5,954 | 21,236 | |
Predecessor | Deferred Income Tax (Liability) Asset | ||||
Schedule of Investments [Line Items] | ||||
Balance | -2,084 | -7,433 | -7,299 | |
Net investment gains and losses on investments arising during the period | -828 | 5,349 | -343 | |
Reclassification adjustment for gains and losses included in net income | -100 | -209 | ||
Balance | -2,812 | -2,084 | -7,433 | |
Predecessor | Accumulated Net Unrealized Investment Gain (Loss) | ||||
Schedule of Investments [Line Items] | ||||
Balance | 3,870 | 13,803 | 13,556 | |
Net investment gains and losses on investments arising during the period | 1,536 | -9,932 | 634 | |
Reclassification adjustment for gains and losses included in net income | 185 | 1 | 387 | |
Balance | $5,221 | $3,870 | $13,803 |
Summary_of_Volume_and_Fair_Val
Summary of Volume and Fair Value Position of Derivative Financial Instruments (Detail) (USD $) | Dec. 31, 2014 | |
In Thousands, unless otherwise specified | ||
Contractholder funds | Equity-indexed annuity contracts | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | $1,734,264 | [1] |
Gross Fair Value, Liabilities | -63,660 | [1] |
Contractholder funds | Equity-indexed life contracts | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 347,610 | [1] |
Gross Fair Value, Liabilities | -18,720 | [1] |
Contractholder funds | Guaranteed accumulation benefits | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 120,714 | [2] |
Gross Fair Value, Liabilities | -6,367 | [2] |
Contractholder funds | Guaranteed withdrawal benefits | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 17,102 | [2] |
Gross Fair Value, Liabilities | -366 | [2] |
Equity Options | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 624 | |
Gross Fair Value, Assets | 68,776 | |
Gross Fair Value, Liabilities | -43,104 | |
Future | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 10 | |
Gross Fair Value, Assets | 329 | |
Predecessor | Contractholder funds | Guaranteed accumulation benefits | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 152,936 | [3] |
Gross Fair Value, Liabilities | -8,970 | [3] |
Predecessor | Contractholder funds | Guaranteed withdrawal benefits | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 22,199 | [3] |
Gross Fair Value, Liabilities | -474 | [3] |
Predecessor | Contractholder funds | Derivatives embedded in life and annuity contracts - Equity-indexed and forward starting options | ||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | ||
Notional | 2,591,090 | [3] |
Gross Fair Value, Liabilities | ($258,415) | [3] |
[1] | Amount represents account value of equity indexed contracts | |
[2] | As of April 1, 2014, these amounts were ceded in accordance with the Company's reinsurance agreements | |
[3] | Prior to April 1, 2014, these amounts were ceded to ALIC or in accordance with the Company's reinsurance agreements. |
Derivative_Financial_Instrumen2
Derivative Financial Instruments - Additional Information (Detail) (USD $) | Dec. 31, 2014 |
In Millions, unless otherwise specified | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Derivative cash and securities collateral held | $6.40 |
Amount_and_Location_of_Gains_L
Amount and Location of Gains (Losses) Recognized in Income for Derivatives Not Designated or Qualifying as Hedging Instruments (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Policyholders' Benefits | $216,543 | ||||||
Derivatives not designated as accounting hedging instruments | Equity Options | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Realized Investment Gains (Losses) | 15,230 | ||||||
Derivatives not designated as accounting hedging instruments | Future | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Realized Investment Gains (Losses) | 2,187 | ||||||
Derivatives not designated as accounting hedging instruments | Equity-indexed annuity contracts | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Policyholders' Benefits | -5,622 | ||||||
Derivatives not designated as accounting hedging instruments | Equity-indexed life contracts | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Policyholders' Benefits | 90 | ||||||
Derivatives not designated as accounting hedging instruments | Predecessor | Life and Annuity Insurance Product Line | |||||||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||||||
Interest Credited | 16,427 | [1] | 36,890 | [1] | 186,625 | [1] | |
Policyholders' Benefits | $946 | [1] | $10,177 | [1] | $5,126 | [1] | |
[1] | Prior to April 1, 2014, these amounts were ceded in accordance with the Company's reinsurance agreements. |
Summary_of_Assets_and_Liabilit
Summary of Assets and Liabilities Measured at Fair Value on Recurring and Non-Recurring Basis (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Liabilities at fair value | ||
Separate accounts assets | ($1,573,865) | |
Assets at fair value | ||
Short-term investments | 361,369 | |
Other invested assets | 26,897 | |
Separate account assets | 1,573,865 | |
Fixed income securities | 9,390,647 | |
Total assets at fair value | 11,351,881 | |
Contractholder funds: | ||
Total liabilities at fair value | -1,662,978 | |
Predecessor | ||
Liabilities at fair value | ||
Separate accounts assets | -1,700,566 | |
Assets at fair value | ||
Short-term investments | 55,959 | |
Separate account assets | 1,700,566 | |
Fixed income securities | 290,882 | |
Total assets at fair value | 2,047,407 | |
% of total assets at fair value | 100.00% | |
Contractholder funds: | ||
Derivatives embedded in life and annuity contracts | -267,859 | |
Total liabilities at fair value | -267,859 | |
% of total liabilities at fair value | 100.00% | |
United States Government, Government Agencies and Authorities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 73,846 | |
Asset-backed securities ("ABS") | ||
Assets at fair value | ||
Fixed income securities | 377,003 | |
Commercial mortgage-backed securities ("CMBS") | ||
Assets at fair value | ||
Fixed income securities | 333,483 | |
Commercial mortgage-backed securities ("CMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,676 | |
Residential mortgage-backed securities ("RMBS") | ||
Assets at fair value | ||
Fixed income securities | 189,881 | |
Residential mortgage-backed securities ("RMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 14,450 | |
Equity indexed annuity contracts | ||
Liabilities at fair value | ||
Policyholders' account balances | -63,660 | |
Equity indexed life contracts | ||
Liabilities at fair value | ||
Policyholders' account balances | -18,720 | |
Guaranteed accumulation benefits | ||
Liabilities at fair value | ||
Policyholders' account balances | -6,367 | |
Guaranteed withdrawal benefits | ||
Liabilities at fair value | ||
Policyholders' account balances | -366 | |
Municipal | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,769 | |
All other corporate securities | ||
Assets at fair value | ||
Fixed income securities | 7,377,745 | |
All other corporate securities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 191,977 | |
Foreign government | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 5,164 | |
Recurring basis | ||
Assets at fair value | ||
Short-term investments | 361,368 | |
Separate account assets | 1,573,865 | |
Recurring basis | Predecessor | ||
Assets at fair value | ||
Short-term investments | 55,959 | |
Separate account assets | 1,700,566 | |
Fixed income securities | 290,882 | |
Recurring basis | United States Government, Government Agencies and Authorities | ||
Assets at fair value | ||
Fixed income securities | 857,326 | |
Recurring basis | United States Government, Government Agencies and Authorities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 73,846 | |
Recurring basis | States, municipalities and political subdivisions | ||
Assets at fair value | ||
Fixed income securities | 255,209 | |
Recurring basis | All other corporate bonds | ||
Assets at fair value | ||
Fixed income securities | 7,377,745 | |
Recurring basis | Asset-backed securities ("ABS") | ||
Assets at fair value | ||
Fixed income securities | 377,003 | |
Recurring basis | Commercial mortgage-backed securities ("CMBS") | ||
Assets at fair value | ||
Fixed income securities | 333,483 | |
Recurring basis | Commercial mortgage-backed securities ("CMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,676 | |
Recurring basis | Residential mortgage-backed securities ("RMBS") | ||
Assets at fair value | ||
Fixed income securities | 189,881 | |
Recurring basis | Residential mortgage-backed securities ("RMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 14,450 | |
Recurring basis | Equity Options | ||
Assets at fair value | ||
Other invested assets | 25,672 | |
Recurring basis | Future | ||
Assets at fair value | ||
Other invested assets | 329 | |
Recurring basis | Municipal | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,769 | |
Recurring basis | All other corporate securities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 191,977 | |
Recurring basis | Foreign government | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 5,164 | |
Quoted prices in active markets for identical assets (Level 1) | ||
Liabilities at fair value | ||
Separate accounts assets | -1,573,865 | |
Assets at fair value | ||
Total assets at fair value | 1,791,845 | |
Contractholder funds: | ||
Total liabilities at fair value | -1,573,865 | |
Quoted prices in active markets for identical assets (Level 1) | Predecessor | ||
Assets at fair value | ||
Total assets at fair value | 1,748,850 | |
% of total assets at fair value | 85.40% | |
Quoted prices in active markets for identical assets (Level 1) | Recurring basis | ||
Assets at fair value | ||
Short-term investments | 191,979 | |
Separate account assets | 1,573,865 | |
Quoted prices in active markets for identical assets (Level 1) | Recurring basis | Predecessor | ||
Assets at fair value | ||
Short-term investments | 20,764 | |
Separate account assets | 1,700,566 | |
Fixed income securities | 27,520 | |
Quoted prices in active markets for identical assets (Level 1) | Recurring basis | United States Government, Government Agencies and Authorities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 27,520 | |
Quoted prices in active markets for identical assets (Level 1) | Recurring basis | Equity Options | ||
Assets at fair value | ||
Other invested assets | 25,672 | |
Quoted prices in active markets for identical assets (Level 1) | Recurring basis | Future | ||
Assets at fair value | ||
Other invested assets | 329 | |
Significant other observable inputs (Level 2) | ||
Assets at fair value | ||
Total assets at fair value | 9,521,044 | |
Contractholder funds: | ||
Total liabilities at fair value | -18,720 | |
Significant other observable inputs (Level 2) | Predecessor | ||
Assets at fair value | ||
Total assets at fair value | 298,557 | |
% of total assets at fair value | 14.60% | |
Significant other observable inputs (Level 2) | Equity indexed life contracts | ||
Liabilities at fair value | ||
Policyholders' account balances | -18,720 | |
Significant other observable inputs (Level 2) | Recurring basis | ||
Assets at fair value | ||
Short-term investments | 145,676 | |
Significant other observable inputs (Level 2) | Recurring basis | Predecessor | ||
Assets at fair value | ||
Short-term investments | 35,195 | |
Fixed income securities | 263,362 | |
Significant other observable inputs (Level 2) | Recurring basis | United States Government, Government Agencies and Authorities | ||
Assets at fair value | ||
Fixed income securities | 857,326 | |
Significant other observable inputs (Level 2) | Recurring basis | United States Government, Government Agencies and Authorities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 46,326 | |
Significant other observable inputs (Level 2) | Recurring basis | States, municipalities and political subdivisions | ||
Assets at fair value | ||
Fixed income securities | 255,209 | |
Significant other observable inputs (Level 2) | Recurring basis | All other corporate bonds | ||
Assets at fair value | ||
Fixed income securities | 7,370,409 | |
Significant other observable inputs (Level 2) | Recurring basis | Asset-backed securities ("ABS") | ||
Assets at fair value | ||
Fixed income securities | 371,753 | |
Significant other observable inputs (Level 2) | Recurring basis | Commercial mortgage-backed securities ("CMBS") | ||
Assets at fair value | ||
Fixed income securities | 330,790 | |
Significant other observable inputs (Level 2) | Recurring basis | Commercial mortgage-backed securities ("CMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,676 | |
Significant other observable inputs (Level 2) | Recurring basis | Residential mortgage-backed securities ("RMBS") | ||
Assets at fair value | ||
Fixed income securities | 189,881 | |
Significant other observable inputs (Level 2) | Recurring basis | Residential mortgage-backed securities ("RMBS") | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 14,450 | |
Significant other observable inputs (Level 2) | Recurring basis | Municipal | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 2,769 | |
Significant other observable inputs (Level 2) | Recurring basis | All other corporate securities | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 191,977 | |
Significant other observable inputs (Level 2) | Recurring basis | Foreign government | Predecessor | ||
Assets at fair value | ||
Fixed income securities | 5,164 | |
Significant unobservable inputs (Level 3) | ||
Assets at fair value | ||
Total assets at fair value | 38,992 | |
Contractholder funds: | ||
Total liabilities at fair value | -70,393 | |
Significant unobservable inputs (Level 3) | Predecessor | ||
Contractholder funds: | ||
Derivatives embedded in life and annuity contracts | -267,859 | |
Total liabilities at fair value | -267,859 | |
% of total liabilities at fair value | 100.00% | |
Significant unobservable inputs (Level 3) | Equity indexed annuity contracts | ||
Liabilities at fair value | ||
Policyholders' account balances | -63,660 | |
Significant unobservable inputs (Level 3) | Guaranteed accumulation benefits | ||
Liabilities at fair value | ||
Policyholders' account balances | -6,367 | |
Significant unobservable inputs (Level 3) | Guaranteed withdrawal benefits | ||
Liabilities at fair value | ||
Policyholders' account balances | -366 | |
Significant unobservable inputs (Level 3) | Recurring basis | ||
Assets at fair value | ||
Short-term investments | 23,713 | |
Significant unobservable inputs (Level 3) | Recurring basis | All other corporate bonds | ||
Assets at fair value | ||
Fixed income securities | 7,336 | |
Significant unobservable inputs (Level 3) | Recurring basis | Asset-backed securities ("ABS") | ||
Assets at fair value | ||
Fixed income securities | 5,250 | |
Significant unobservable inputs (Level 3) | Recurring basis | Commercial mortgage-backed securities ("CMBS") | ||
Assets at fair value | ||
Fixed income securities | $2,693 |
Summary_of_Quantitative_Inform
Summary of Quantitative Information About Significant Unobservable Inputs Used in Level Three Fair Value Measurements (Detail) (USD $) | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value, liability | -1,662,978 | |
Equity indexed annuity contracts | Option Pricing Model Approach Valuation Technique [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value, liability | -63,660 | |
Minimum | Equity indexed annuity contracts | Option Pricing Model Approach Valuation Technique [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 1.40% | |
Maximum | Equity indexed annuity contracts | Option Pricing Model Approach Valuation Technique [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 1.93% | |
Weighted average | Equity indexed annuity contracts | Option Pricing Model Approach Valuation Technique [Member] | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 1.50% | |
Predecessor | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value, liability | -267,859 | |
Predecessor | Derivatives embedded in life and annuity contracts - Equity-indexed and forward starting options | Stochastic cash flow model | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Fair value, liability | -258,415 | |
Predecessor | Minimum | Derivatives embedded in life and annuity contracts - Equity-indexed and forward starting options | Stochastic cash flow model | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 1.00% | |
Predecessor | Maximum | Derivatives embedded in life and annuity contracts - Equity-indexed and forward starting options | Stochastic cash flow model | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 2.00% | |
Predecessor | Weighted average | Derivatives embedded in life and annuity contracts - Equity-indexed and forward starting options | Stochastic cash flow model | ||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||
Projected option cost (as a percent) | 1.91% |
Fair_Value_Additional_Informat
Fair Value - Additional Information (Detail) (Predecessor, USD $) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | |
Fair Value Disclosures [Line Items] | ||||
Fair value reinsurement rate | 100.00% | |||
Gains (losses) for Level 3 assets still held at the balance sheet date, included in interest credited to contract holder funds | $17,600,000 | $33,000,000 | $125,900,000 | |
Gains (losses) for Level 3 liabilities still held at the balance sheet date, included in life and annuity contract benefits | 946,000 | 10,200,000 | 5,100,000 | |
Quoted prices in active markets for identical assets (Level 1) | ||||
Fair Value Disclosures [Line Items] | ||||
Fair value measurement of investment | 15,000,000 | |||
Carrying value | ||||
Fair Value Disclosures [Line Items] | ||||
Contractholder funds on investment contracts | 7,760,000,000 | |||
Fair value | ||||
Fair Value Disclosures [Line Items] | ||||
Contractholder funds on investment contracts | $7,660,000,000 |
Schedule_of_Rollforward_of_Lev
Schedule of Rollforward of Level Three Assets and Liabilities Held at Fair Value on Recurring Basis (Detail) (USD $) | 12 Months Ended | 9 Months Ended | 3 Months Ended | ||||||
In Thousands, unless otherwise specified | Dec. 31, 2013 | Dec. 01, 2013 | Dec. 31, 2012 | Dec. 31, 2014 | Mar. 31, 2014 | ||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 assets, Balance at beginning of period | $312 | $312 | $2,919 | ||||||
Level 3 assets, Transfers into Level 3 | 0 | 0 | |||||||
Level 3 assets, Transfers out of Level 3 | -2,321 | ||||||||
Level 3 assets, Issues | 0 | 0 | |||||||
Level 3 assets, Settlements | -312 | -286 | |||||||
Level 3 assets, Balance at end of period | 312 | ||||||||
Equity indexed annuity contracts | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 liabilities, Balance at beginning of period | -58,038 | ||||||||
Level 3 liabilities, Total gains (losses) included in net income | -5,622 | ||||||||
Level 3 liabilities, Total gains (losses) included in OCI | 0 | ||||||||
Level 3 liabilities, Transfers into Level 3 | 0 | ||||||||
Level 3 liabilities, Transfers out of Level 3 | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPurchases | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySales | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueEndingBalance | -63,660 | ||||||||
Equity indexed life contracts | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 liabilities, Balance at beginning of period | -15,691 | ||||||||
Level 3 liabilities, Total gains (losses) included in net income | -3,029 | ||||||||
Level 3 liabilities, Total gains (losses) included in OCI | 0 | ||||||||
Level 3 liabilities, Transfers into Level 3 | 0 | ||||||||
Level 3 liabilities, Transfers out of Level 3 | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPurchases | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySales | 0 | ||||||||
FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueEndingBalance | -18,720 | ||||||||
GMWB/GMAB | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 liabilities, Balance at beginning of period | -8,499 | [1] | |||||||
Level 3 liabilities, Total gains (losses) included in net income | -1,766 | [1] | |||||||
Level 3 liabilities, Total gains (losses) included in OCI | 0 | [1] | |||||||
Level 3 liabilities, Transfers into Level 3 | 0 | [1] | |||||||
Level 3 liabilities, Transfers out of Level 3 | 0 | [1] | |||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPurchases | 0 | [1] | |||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySales | 0 | [1] | |||||||
FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueEndingBalance | -6,733 | [1] | |||||||
All other corporate securities | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 assets, Balance at beginning of period | 312 | 312 | 598 | 400,527 | |||||
Level 3 assets, Total gains (losses) included in net income | 6,693 | ||||||||
Level 3 assets, Total gains (losses) included in OCI | -7,841 | ||||||||
Level 3 assets, Transfers into Level 3 | 0 | 0 | 0 | ||||||
Level 3 assets, Transfers out of Level 3 | -291,802 | ||||||||
Level 3 assets, Purchases | 4,930 | ||||||||
Level 3 assets, Sales | -97,228 | ||||||||
Level 3 assets, Issues | 0 | 0 | 0 | ||||||
Level 3 assets, Settlements | -312 | -286 | |||||||
Level 3 assets, Balance at end of period | 312 | 15,279 | |||||||
Short-term investments | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 assets, Balance at beginning of period | 24,095 | ||||||||
Level 3 assets, Total gains (losses) included in net income | 29 | ||||||||
Level 3 assets, Transfers into Level 3 | 0 | ||||||||
Level 3 assets, Sales | -411 | ||||||||
Level 3 assets, Issues | 0 | ||||||||
Level 3 assets, Balance at end of period | 23,713 | ||||||||
Residential mortgage-backed securities ("RMBS") | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 assets, Balance at beginning of period | 2,321 | ||||||||
Level 3 assets, Transfers into Level 3 | 0 | ||||||||
Level 3 assets, Transfers out of Level 3 | -2,321 | ||||||||
Level 3 assets, Issues | 0 | ||||||||
Predecessor | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 liabilities, Balance at beginning of period | -314,926 | -506,678 | -267,859 | ||||||
Level 3 liabilities, Total gains (losses) included in net income | 43,244 | [2] | 131,054 | [3] | 18,525 | [4] | |||
Level 3 liabilities, Total gains (losses) included in OCI | 0 | 0 | 0 | ||||||
Level 3 liabilities, Transfers into Level 3 | 0 | 0 | 0 | ||||||
Level 3 liabilities, Transfers out of Level 3 | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPurchases | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySales | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityIssues | -6,621 | -11,024 | -3,764 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySettlements | 10,444 | 71,722 | 2,612 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueEndingBalance | -267,859 | -314,926 | -250,486 | ||||||
Predecessor | Derivatives embedded in life and annuity contracts | |||||||||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||||||||
Level 3 liabilities, Balance at beginning of period | -314,926 | -506,678 | -267,859 | ||||||
Level 3 liabilities, Total gains (losses) included in net income | 43,244 | [2] | 131,054 | [3] | 18,525 | [4] | |||
Level 3 liabilities, Total gains (losses) included in OCI | 0 | 0 | 0 | ||||||
Level 3 liabilities, Transfers into Level 3 | 0 | 0 | 0 | ||||||
Level 3 liabilities, Transfers out of Level 3 | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityPurchases | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySales | 0 | 0 | 0 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilityIssues | -6,621 | -11,024 | -3,764 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationRecurringBasisLiabilitySettlements | 10,444 | 71,722 | 2,612 | ||||||
FairValueMeasurementWithUnobservableInputsReconciliationsRecurringBasisLiabilityValueEndingBalance | ($267,859) | ($314,926) | ($250,486) | ||||||
[1] | These amount are 100% ceded in accordance with the Company's reinsurance agreements. | ||||||||
[2] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $33.0 million in interest credited to contractholder funds and $10.2 million in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. | ||||||||
[3] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $125.9 million in interest credited to contractholder funds and $5.1 million in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. | ||||||||
[4] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $17.6 million in interest credited to contractholder funds and $946 thousand in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. |
Assets_and_Liabilities_Measure
Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) (USD $) | Dec. 31, 2014 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | $1,946,225 |
Liabilities | 7,160,853 |
Investment Contracts | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | 6,609,253 |
Other Long Term Debt | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | 551,600 |
Commercial Mortgage Loans | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 1,150,510 |
Policy Loans | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 194,385 |
Cash [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 49,730 |
Vehicle Note | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 551,600 |
Quoted prices in active markets for identical assets (Level 1) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 49,730 |
Quoted prices in active markets for identical assets (Level 1) | Cash [Member] | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 49,730 |
Significant unobservable inputs (Level 3) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 1,896,495 |
Liabilities | 7,160,853 |
Significant unobservable inputs (Level 3) | Investment Contracts | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | 6,609,253 |
Significant unobservable inputs (Level 3) | Other Long Term Debt | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Liabilities | 551,600 |
Significant unobservable inputs (Level 3) | Commercial Mortgage Loans | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 1,150,510 |
Significant unobservable inputs (Level 3) | Policy Loans | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | 194,385 |
Significant unobservable inputs (Level 3) | Vehicle Note | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Assets | $551,600 |
Schedule_of_Rollforward_of_Lev1
Schedule of Rollforward of Level Three Assets and Liabilities Held at Fair Value on Recurring Basis (Parenthetical) (Detail) (Predecessor, USD $) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Predecessor | |||
Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Effect to net income included in interest credited to contract holder funds | $17,600,000 | $33,000,000 | $125,900,000 |
Effect to net income included in contract benefits | $946,000 | $10,200,000 | $5,100,000 |
Schedule_of_Change_in_Unrealiz
Schedule of Change in Unrealized Gains and Losses Included in Net Income for Level Three Assets and Liabilities Held (Detail) (Predecessor, USD $) | 3 Months Ended | 12 Months Ended | ||||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |||
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Inputs Gain Loss [Line Items] | ||||||
Gains (losses) for Level 3 liabilities still held at the balance sheet date, included in earnings | $18,525 | [1] | $43,244 | [2] | $131,054 | [3] |
Derivatives embedded in life and annuity contracts | ||||||
Fair Value Assets And Liabilities Measured On Recurring Basis Unobservable Inputs Gain Loss [Line Items] | ||||||
Gains (losses) for Level 3 liabilities still held at the balance sheet date, included in earnings | $18,525 | $43,244 | $131,054 | |||
[1] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $17.6 million in interest credited to contractholder funds and $946 thousand in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. | |||||
[2] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $33.0 million in interest credited to contractholder funds and $10.2 million in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. | |||||
[3] | The amount attributable to derivatives embedded in life and annuity contracts was reported as follows: $125.9 million in interest credited to contractholder funds and $5.1 million in contract benefits. These amounts were ceded in accordance with the Company's reinsurance agreements. |
Reinsurance_Additional_Informa
Reinsurance - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Effects of Reinsurance [Line Items] | ||
Deposit receivable | $1,383,388 | |
Modified coinsurance payable | $1,383,388 | |
Allstate Life Insurance Company | ||
Effects of Reinsurance [Line Items] | ||
Reinsurance recoverable | 65.00% | |
Non-affiliates | Rated A- or better | ||
Effects of Reinsurance [Line Items] | ||
Reinsurance recoverable | 99.80% | |
Predecessor | Allstate Life Insurance Company | ||
Effects of Reinsurance [Line Items] | ||
Reinsurance recoverable | 86.90% | |
Predecessor | Non-affiliates | ||
Effects of Reinsurance [Line Items] | ||
Reinsurance recoverable | 13.10% | |
Predecessor | Non-affiliates | Rated A- or better | ||
Effects of Reinsurance [Line Items] | ||
Reinsurance recoverable | 95.00% |
Schedule_of_Effects_of_Reinsur
Schedule of Effects of Reinsurance on Premiums and Contract Charges (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Effects of Reinsurance [Line Items] | ||||
Direct premiums and contract charges | $921,444 | |||
Assumed premiums and contract charges | 5,258 | |||
Ceded premiums and contract charges | -702,833 | |||
Premiums and fee income, net of reinsurance | 223,869 | |||
Predecessor | ||||
Effects of Reinsurance [Line Items] | ||||
Direct premiums and contract charges | 331,899 | 1,331,597 | 1,298,864 | |
Assumed premiums and contract charges | 1,581 | 6,830 | 6,784 | |
Predecessor | Affiliates | ||||
Effects of Reinsurance [Line Items] | ||||
Ceded premiums and contract charges | -244,797 | -962,576 | -908,459 | |
Predecessor | Non-affiliates | ||||
Effects of Reinsurance [Line Items] | ||||
Ceded premiums and contract charges | ($88,683) | ($375,851) | ($397,189) |
Schedule_of_Effects_of_Reinsur1
Schedule of Effects of Reinsurance on Interest Credited to Contractholder Funds, Contract Benefits and Expenses (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Effects of Reinsurance [Line Items] | ||||
Direct interest credited to contractholder funds, contract benefits and expenses | $1,104,420 | |||
Assumed interest credited to contractholder funds, contract benefits and expenses | 4,713 | |||
Ceded interest credited to contractholder funds, contract benefits and expenses | -635,887 | |||
Return credited to policyholders' account balances and policyholder benefits, net of reinsurance | 473,246 | |||
Predecessor | ||||
Effects of Reinsurance [Line Items] | ||||
Direct interest credited to contractholder funds, contract benefits and expenses | 450,041 | 1,938,015 | 1,882,714 | |
Assumed interest credited to contractholder funds, contract benefits and expenses | 2,606 | 8,180 | 9,167 | |
Predecessor | Affiliates | ||||
Effects of Reinsurance [Line Items] | ||||
Ceded interest credited to contractholder funds, contract benefits and expenses | -336,122 | -1,505,010 | -1,369,305 | |
Predecessor | Non-affiliates | ||||
Effects of Reinsurance [Line Items] | ||||
Ceded interest credited to contractholder funds, contract benefits and expenses | ($116,525) | ($441,185) | ($522,576) |
Components_of_Deferred_Income_
Components of Deferred Income Tax Assets and Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Deferred tax assets | ||
Policyholder reserves | $2,057,627 | |
Deferred acquisition costs | 24,850 | |
Premiums receivable | 8,197 | |
Net operating loss carryforward | 7,500 | |
Other assets | 38 | |
Total deferred tax assets | 2,098,212 | |
Deferred tax liabilities | ||
Value of business acquired | -81,032 | |
Amounts recoverable from reinsurers | -2,010,157 | |
Investments | -45,935 | |
Intangibles | -1,820 | |
Total deferred tax liabilities | -2,138,944 | |
Net deferred tax liability | -40,732 | |
Predecessor | ||
Deferred tax assets | ||
Reinsurance recoverables | 497 | |
Other assets | 4 | |
Total deferred tax assets | 501 | |
Deferred tax liabilities | ||
Unrealized net capital gains | -2,084 | |
Accrued expenses | -981 | |
Other liabilities | 0 | |
Total deferred tax liabilities | -3,065 | |
Net deferred tax liability | ($2,564) |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 9 Months Ended | 12 Months Ended | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Schedule Of Income Taxes [Line Items] | |||||
Net operating loss carryforward | $21,500,000 | $21,500,000 | |||
Net operating loss carryforward, expiration year | Will expire in the year 2029, if unused. | ||||
Federal statutory tax rate | 35.00% | ||||
Predecessor | |||||
Schedule Of Income Taxes [Line Items] | |||||
Federal statutory tax rate | 35.00% | 35.00% | 35.00% | ||
Unrecognized tax benefits | 0 | ||||
Income taxes paid | $0 | $4,200,000 | $4,800,000 |
Reconciliation_of_Statutory_Fe
Reconciliation of Statutory Federal Income Tax Rate to Effective Income Tax Rate (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Rate Reconciliation [Line Items] | ||||
Expected federal income tax expense | $15,722 | |||
Dividends received deduction | -1,470 | |||
Other | -18 | |||
Total income tax expense | 14,234 | |||
Statutory federal income tax rate | 35.00% | |||
Predecessor | ||||
Income Tax Rate Reconciliation [Line Items] | ||||
Total income tax expense | $922 | $3,825 | $4,273 | |
Statutory federal income tax rate | 35.00% | 35.00% | 35.00% | |
Other | 0.00% | 0.00% | 0.00% | |
Effective income tax rate | 35.00% | 35.00% | 35.00% |
Components_of_Income_Tax_Expen
Components of Income Tax Expense (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Components Of Income Tax Expense Benefit [Line Items] | ||||
Deferred | $14,234 | |||
Total income tax expense | 14,234 | |||
Predecessor | ||||
Components Of Income Tax Expense Benefit [Line Items] | ||||
Current | 914 | 3,902 | 4,145 | |
Deferred | 8 | -77 | 128 | |
Total income tax expense | $922 | $3,825 | $4,273 |
Schedule_of_Future_Policy_Bene
Schedule of Future Policy Benefits and Other Policyholder Liabilities (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | $6,463,964 | |
Traditional life insurance | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 1,492,438 | |
Immediate fixed annuities | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 635,858 | |
Accident And Health Insurance | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 1,462,110 | |
Equity indexed annuity contracts | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 1,895,889 | |
Other Life Contingent Products | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 977,669 | |
Predecessor | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 3,557,411 | |
Predecessor | Traditional life insurance | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 1,548,134 | |
Predecessor | Immediate fixed annuities | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 676,565 | |
Predecessor | Accident And Health Insurance | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | 1,324,268 | |
Predecessor | Other Life Contingent Products | ||
Liability for Future Policy Benefit, by Product Segment [Line Items] | ||
Reserve for life-contingent contract benefits | $8,444 |
Future_Policy_Benefits_and_Oth2
Future Policy Benefits and Other Policyholder Liabilities - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Minimum | |
Interest rate determination of present values, percentage | 2.50% |
Maximum | |
Interest rate determination of present values, percentage | 6.00% |
Schedule_of_Key_Assumptions_Us
Schedule of Key Assumptions Used In Calculation Reserve for Life-Contingent Contract Benefits (Detail) (Predecessor) | 12 Months Ended |
Dec. 31, 2013 | |
Traditional life insurance | |
Liability for Future Policy Benefit, by Product Segment [Line Items] | |
Mortality | Actual company experience plus loading |
Interest rate description | Interest rate assumptions range from 2.5% to 8.0% |
Interest rate, low end | 2.50% |
Interest rate, high end | 8.00% |
Estimation method | Net level premium reserve method using the Company's withdrawal experience rates; includes reserves for unpaid claims |
Immediate fixed annuities | |
Liability for Future Policy Benefit, by Product Segment [Line Items] | |
Mortality | 1983 individual annuity mortality table with internal modifications; 1983 individual annuity mortality table; Annuity 2000 mortality table with internal modifications |
Estimation method | Present value of expected future benefits based on historical experience |
Interest rate description | Interest rate assumptions range from 0% to 8.8% |
Interest rate, low end | 0.00% |
Interest rate, high end | 8.80% |
Accident And Health Insurance | |
Liability for Future Policy Benefit, by Product Segment [Line Items] | |
Mortality | Actual company experience plus loading |
Estimation method | Unearned premium; additional contract reserves for mortality risk and unpaid claims |
Interest rate description | Interest rate assumptions range from 4.0% to 5.3% |
Interest rate, low end | 4.00% |
Interest rate, high end | 5.30% |
GMDB | |
Liability for Future Policy Benefit, by Product Segment [Line Items] | |
Mortality | Annuity 2000 mortality table with internal modifications |
Estimation method | Projected benefit ratio applied to cumulative assessments |
Interest rate description | Interest rate assumptions range from 4.0% to 5.8% |
Interest rate, low end | 4.00% |
Interest rate, high end | 5.80% |
Policyholder_Account_Balances_1
Policyholder Account Balances (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | $9,829,337 | |
Predecessor | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 13,124,115 | |
Interest-sensitive life insurance | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 5,008,094 | |
Interest-sensitive life insurance | Predecessor | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 5,020,265 | |
Equity indexed annuity contracts | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 4,806,270 | |
Equity indexed annuity contracts | Predecessor | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 7,803,892 | |
Other investment contracts | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | 14,973 | |
Other investment contracts | Predecessor | ||
Policyholder Contract Deposits By Product [Line Items] | ||
Total policyholders' account balances | $299,958 |
Policyholder_Account_Balances_2
Policyholder Account Balances - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
Minimum | |
Interest crediting rates range for sensitive contracts | 0.40% |
Interest crediting rates for individual annuities | 0.00% |
Maximum | |
Interest crediting rates range for sensitive contracts | 6.00% |
Interest crediting rates for individual annuities | 6.00% |
Schedule_of_Contract_Provision
Schedule of Contract Provisions Related to Policyholders' Account Balances (Detail) (Predecessor) | 12 Months Ended |
Dec. 31, 2014 | |
Other investment contracts | |
Interest rate description | Interest rates used in establishing reserves range from 1.7% to 10.3% |
Interest rate, low end | 1.70% |
Interest rate, high end | 10.30% |
Withdrawal/surrender charges | Withdrawal and surrender charges are based on the terms of the related interest-sensitive life insurance or fixed annuity contract |
Fixed annuities | |
Interest rate description | Interest rates credited range from 0% to 8.8% fo immediate annuities; 0% to 7.0% for equity-indexed annuities (whose returns are indexed to the S&P 500); and 1.0% to 6.0% for all other products |
Withdrawal/surrender charges | Either a declining or a level percentage charge generally over ten years or less. Additionally, approximately 18.7% of fixed annuities are subject to market value adjustment for discretionary withdrawals. |
Term of withdrawal/surrender charges | 10 years |
Percentage of fixed annuities subject to market value adjustment for discretionary withdrawals | 18.70% |
Fixed annuities | Immediate annuities | |
Interest rate, low end | 0.00% |
Interest rate, high end | 8.80% |
Fixed annuities | Equity-indexed life | |
Interest rate, low end | 0.00% |
Interest rate, high end | 7.00% |
Fixed annuities | All other products | |
Interest rate, low end | 1.00% |
Interest rate, high end | 6.00% |
Interest-sensitive life insurance | |
Interest rate description | Interest rates credited range from 0% to 10.0% for equity-indexed life (whose returns are indexed to the S&P 500) and 2.6% to 6.0% for all other products |
Withdrawal/surrender charges | Either a percentage of account balance or dollar amount grading off generally over 20 years |
Term of withdrawal/surrender charges | 20 years |
Interest-sensitive life insurance | Equity-indexed life | |
Interest rate, low end | 0.00% |
Interest rate, high end | 10.00% |
Interest-sensitive life insurance | All other products | |
Interest rate, low end | 2.60% |
Interest rate, high end | 6.00% |
Summary_of_Variable_Annuity_Co
Summary of Variable Annuity Contracts (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Guaranteed accumulation benefits | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value | $118.40 | |
Net amount at risk | 6.2 | |
Weighted average waiting period until guarantee date | 6 years | |
Guaranteed withdrawal benefits | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value | 16.6 | |
Net amount at risk | 0.1 | |
GMIB | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value, at annuitization / accumulation | 151.9 | |
Net amount at risk, at annuitization / accumulation | 15.2 | |
Weighted average waiting period until guarantee date | 0 years | |
GMDB | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value, in the event of death | 742.7 | |
Net amount at risk, in the event of death | 57.2 | |
Average attained age of contractholders | 60 years | |
GMDB | Variable Life, Variable Universal Life and Universal Life Contracts | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value, in the event of death | 325.1 | |
General account value, in the event of death | 31,518.30 | |
Net amount at risk, in the event of death | 89,942.80 | |
Average attained age of contractholders | 51 years | |
Predecessor | Guaranteed accumulation benefits | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value | 151.1 | |
Net amount at risk | 7.3 | |
Weighted average waiting period until guarantee date | 6 years | |
Predecessor | Guaranteed withdrawal benefits | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value | 21.8 | |
Net amount at risk | 0.1 | |
Predecessor | GMIB | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value, at annuitization / accumulation | 170.5 | |
Net amount at risk, at annuitization / accumulation | 16.6 | |
Weighted average waiting period until guarantee date | 0 years | |
Predecessor | GMDB | Variable Annuity | ||
Net Amount at Risk by Product and Guarantee [Line Items] | ||
Separate account value, in the event of death | 877 | |
Net amount at risk, in the event of death | $63.20 | |
Average attained age of contractholders | 59 years |
Liabilities_for_Guarantee_Bene
Liabilities for Guarantee Benefits (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 |
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | $575,841 | ||
Less: reinsurance recoverable | 90,966 | ||
Net beginning balance | 484,875 | ||
Incurred guarantee benefits | 159,104 | ||
Paid guarantee benefits | -108,252 | ||
Net change | 50,852 | ||
Net ending balance | 535,727 | ||
Plus reinsurance recoverable | 107,064 | ||
Gross ending balance | 642,791 | ||
Predecessor | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 308,402 | 249,183 | |
Less: reinsurance recoverable | 308,402 | 249,183 | |
Net beginning balance | 0 | 0 | |
Incurred guarantee benefits | 0 | 0 | |
Paid guarantee benefits | 0 | 0 | |
Net change | 0 | 0 | |
Net ending balance | 0 | 0 | |
Plus reinsurance recoverable | 317,382 | 308,402 | |
Gross ending balance | 317,382 | 308,402 | |
Variable Annuity | GMDB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 8,057 | ||
Less: reinsurance recoverable | 8,057 | ||
Net beginning balance | 0 | ||
Incurred guarantee benefits | 0 | ||
Paid guarantee benefits | 0 | ||
Net change | 0 | ||
Net ending balance | 0 | ||
Plus reinsurance recoverable | 8,358 | ||
Gross ending balance | 8,358 | ||
Variable Annuity | GMIB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 7,122 | ||
Less: reinsurance recoverable | 7,122 | ||
Net beginning balance | 0 | ||
Incurred guarantee benefits | 0 | ||
Paid guarantee benefits | 0 | ||
Net change | 0 | ||
Net ending balance | 0 | ||
Plus reinsurance recoverable | 8,240 | ||
Gross ending balance | 8,240 | ||
Variable Annuity | GMWB/GMAB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 8,499 | ||
Less: reinsurance recoverable | 8,499 | ||
Net beginning balance | 0 | ||
Incurred guarantee benefits | 0 | ||
Paid guarantee benefits | 0 | ||
Net change | 0 | ||
Net ending balance | 0 | ||
Plus reinsurance recoverable | 6,733 | ||
Gross ending balance | 6,733 | ||
Variable Annuity | Predecessor | GMDB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 8,444 | 9,390 | |
Less: reinsurance recoverable | 8,444 | 9,390 | |
Net beginning balance | 0 | 0 | |
Incurred guarantee benefits | 0 | 0 | |
Paid guarantee benefits | 0 | 0 | |
Net change | 0 | 0 | |
Net ending balance | 0 | 0 | |
Plus reinsurance recoverable | 8,057 | 8,444 | |
Gross ending balance | 8,057 | 8,444 | |
Variable Annuity | Predecessor | GMIB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 8,743 | 19,484 | |
Less: reinsurance recoverable | 8,743 | 19,484 | |
Net beginning balance | 0 | 0 | |
Incurred guarantee benefits | 0 | 0 | |
Paid guarantee benefits | 0 | 0 | |
Net change | 0 | 0 | |
Net ending balance | 0 | 0 | |
Plus reinsurance recoverable | 7,122 | 8,743 | |
Gross ending balance | 7,122 | 8,743 | |
Variable Annuity | Predecessor | GMWB/GMAB | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 9,444 | 19,621 | |
Less: reinsurance recoverable | 9,444 | 19,621 | |
Net beginning balance | 0 | 0 | |
Incurred guarantee benefits | 0 | 0 | |
Paid guarantee benefits | 0 | 0 | |
Net change | 0 | 0 | |
Net ending balance | 0 | 0 | |
Plus reinsurance recoverable | 8,499 | 9,444 | |
Gross ending balance | 8,499 | 9,444 | |
Secondary Guarantees Interest-Sensitive Life and Fixed Annuities | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 552,163 | ||
Less: reinsurance recoverable | 67,288 | ||
Net beginning balance | 484,875 | ||
Incurred guarantee benefits | 159,104 | ||
Paid guarantee benefits | -108,252 | ||
Net change | 50,852 | ||
Net ending balance | 535,727 | ||
Plus reinsurance recoverable | 83,733 | ||
Gross ending balance | 619,460 | ||
Secondary Guarantees Interest-Sensitive Life and Fixed Annuities | Predecessor | |||
Liabilities for Guarantees on Long-Duration Contracts [Line Items] | |||
Gross beginning balance | 281,771 | 200,688 | |
Less: reinsurance recoverable | 281,771 | 200,688 | |
Net beginning balance | 0 | 0 | |
Incurred guarantee benefits | 0 | 0 | |
Paid guarantee benefits | 0 | 0 | |
Net change | 0 | 0 | |
Net ending balance | 0 | 0 | |
Plus reinsurance recoverable | 293,704 | 281,771 | |
Gross ending balance | $293,704 | $281,771 |
Changes_to_Value_of_Business_A
Changes to Value of Business Acquired (Detail) (USD $) | 9 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | |
Movement in Present Value of Future Insurance Profits [Roll Forward] | ||
Balance at beginning of period | $290,795 | |
Business acquired | 0 | |
Amortized to expense during the year | -38,987 | [1] |
Adjustment for unrealized investment gains during the year | -20,287 | |
Balance at end of year | $231,521 | |
[1] | Amount is included in Other Expenses on the Consolidated Statement of Operations and Other Comprehensive Income (Loss) |
Estimated_Percentage_of_VOBA_B
Estimated Percentage of VOBA Balance to be Amortized (Detail) | 12 Months Ended |
Dec. 31, 2014 | |
VOBA Amortization | |
2015 | 14.00% |
2016 | 12.00% |
2017 | 11.00% |
2018 | 9.00% |
2019 and thereafter | 54.00% |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | Dec. 31, 2014 | Dec. 31, 2013 |
Commitments and Contingencies Disclosure [Line Items] | ||
Accrued guaranty fund | $6,700,000 | |
Estimated future of premium tax deductions | 11,200,000 | |
Amount of deposit with governmental authorities required by law | 8,900,000 | |
Derivative cash collateral received | 6,400,000 | |
Predecessor | ||
Commitments and Contingencies Disclosure [Line Items] | ||
Amount of deposit with governmental authorities required by law | 9,400,000 | |
Derivative cash collateral received | $0 |
Regulatory_Capital_and_Dividen1
Regulatory Capital and Dividends - Additional Information (Detail) (USD $) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2014 | Dec. 31, 2013 |
Statutory Accounting Practices [Line Items] | ||
Statutory net income | $226 | |
Statutory capital and surplus | 719 | |
Predecessor | ||
Statutory Accounting Practices [Line Items] | ||
Statutory net income | 7.7 | |
Statutory capital and surplus | $332.50 |
Leases_Additional_Information_
Leases - Additional Information (Detail) (USD $) | 1 Months Ended | |
Dec. 31, 2014 | Dec. 31, 2013 | |
Property Subject to or Available for Operating Lease [Line Items] | ||
Non-cancellable operating lease agreement, expiration date | 31-Jan-26 | |
Lease obligations | $2,639,000 | |
Predecessor | ||
Property Subject to or Available for Operating Lease [Line Items] | ||
Lease obligations | $0 |
Minimum_Aggregate_Rental_Commi
Minimum Aggregate Rental Commitments (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Property Subject to or Available for Operating Lease [Line Items] | |
2015 | $97 |
2016 | 194 |
2017 | 207 |
2018 | 212 |
2019 | 217 |
All future years | 1,712 |
Aggregate total | $2,639 |
Related_Parties_Additional_Inf
Related Parties - Additional Information (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Resolution | ||||
Related Party Transaction [Line Items] | ||||
Related party transactions expense recognized on transaction | $21,100,000 | |||
Lanis | ||||
Related Party Transaction [Line Items] | ||||
Related party transactions expense recognized on transaction | 4,600,000 | |||
Predecessor | Allstate Life Insurance Company | ||||
Related Party Transaction [Line Items] | ||||
Allocated operating expenses | 50,100,000 | 249,700,000 | 241,800,000 | |
Reinsurance recoverable | 14,500,000,000 | |||
Predecessor | Lincoln Benefit Reinsurance Company | ||||
Related Party Transaction [Line Items] | ||||
Reinsurance recoverable | 1,900,000 | |||
Predecessor | Allstate Corporation | ||||
Related Party Transaction [Line Items] | ||||
Inter company loan outstanding | 0 | |||
Predecessor | Allstate Distributors, LLC | ||||
Related Party Transaction [Line Items] | ||||
Broker-Dealer agreement, Promotion and marketing expense | 12,000 | 71,000 | 80,000 | |
Predecessor | Allstate Financial Services, LLC | ||||
Related Party Transaction [Line Items] | ||||
Broker-Dealer agreement, Commission and other distribution expenses | $2,200,000 | $7,700,000 | $6,400,000 |
Receivables_Payables_to_Affili
Receivables/ (Payables) to Affiliates (Detail) (USD $) | Dec. 31, 2014 |
Resolution | |
Related Party Transaction [Line Items] | |
Receivables/ (Payables) to Affiliates | ($4,509,447) |
Lanis | |
Related Party Transaction [Line Items] | |
Receivables/ (Payables) to Affiliates | ($1,563,783) |
Related_Parties_Predecessor_Su
Related Parties - Predecessor - Summary of Ceded Under Reinsurance Agreements (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Related Party Transaction [Line Items] | ||||
Premiums and contract charges | $702,833 | |||
Interest credited to contractholder funds, contract benefits and expenses | 635,887 | |||
Allstate Life Insurance Company | Predecessor | ||||
Related Party Transaction [Line Items] | ||||
Premiums and contract charges | 244,797 | 962,576 | 908,459 | |
Interest credited to contractholder funds, contract benefits and expenses | $336,122 | $1,505,010 | $1,369,305 |
Schedule_I_Consolidated_Summar
Schedule I - Consolidated Summary of Investments Other Than Investments in Related Parties (Detail) (USD $) | Dec. 31, 2014 |
In Thousands, unless otherwise specified | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | $10,929,674 |
Fair value | 9,390,647 |
Amount at which shown in the Balance Sheet | 11,088,465 |
United States Government, Government Agencies and Authorities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 1,060,065 |
Fair value | 1,112,535 |
Amount at which shown in the Balance Sheet | 1,112,535 |
All other corporate bonds | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 7,279,391 |
Fair value | 7,377,745 |
Amount at which shown in the Balance Sheet | 7,377,745 |
Residential mortgage-backed securities ("RMBS") | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 188,055 |
Fair value | 189,881 |
Amount at which shown in the Balance Sheet | 189,881 |
Commercial mortgage-backed securities ("CMBS") | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 331,041 |
Fair value | 333,483 |
Amount at which shown in the Balance Sheet | 333,483 |
Asset-backed securities ("ABS") | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 373,304 |
Fair value | 377,003 |
Amount at which shown in the Balance Sheet | 377,003 |
Fixed income securities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 9,231,856 |
Fair value | 9,390,647 |
Amount at which shown in the Balance Sheet | 9,390,647 |
Mortgage Loans | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 1,115,167 |
Amount at which shown in the Balance Sheet | 1,115,167 |
Policy Loans | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 194,385 |
Amount at which shown in the Balance Sheet | 194,385 |
Derivatives | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 26,001 |
Amount at which shown in the Balance Sheet | 26,001 |
Other long-term assets | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 896 |
Amount at which shown in the Balance Sheet | 896 |
Short-term investments | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 361,369 |
Amount at which shown in the Balance Sheet | 361,369 |
Other securities | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |
Amortized cost | 1,697,818 |
Amount at which shown in the Balance Sheet | $1,697,818 |
Schedule_IV_Consolidated_Reins
Schedule IV - Consolidated Reinsurance (Detail) (USD $) | 9 Months Ended | 3 Months Ended | 12 Months Ended | |
In Thousands, unless otherwise specified | Dec. 31, 2014 | Mar. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Net amount | $20,384 | |||
Gross amount | 395,385,878 | |||
Ceded to other companies | 388,790,881 | |||
Assumed from other companies | 5,106,566 | |||
Net amount | 11,701,563 | |||
Percentage of amount assumed to net | 43.60% | |||
Life and Annuity Insurance Product Line | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 869,472 | |||
Ceded to other companies | -669,382 | |||
Assumed from other companies | 5,258 | |||
Net amount | 205,348 | |||
Percentage of amount assumed to net | 2.60% | |||
Accident and health insurance | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 51,972 | |||
Ceded to other companies | -33,451 | |||
Net amount | 18,521 | |||
Percentage of amount assumed to net | 0.00% | |||
Predecessor | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 331,899 | 1,331,597 | 1,298,864 | |
Ceded to other companies | -333,480 | -1,338,427 | -1,305,648 | |
Assumed from other companies | 1,581 | 6,830 | 6,784 | |
Percentage of amount assumed to net | 0.00% | 0.00% | 0.00% | |
Gross amount | 389,941,404 | 378,467,115 | ||
Ceded to other companies | 395,421,202 | 384,205,939 | ||
Assumed from other companies | 5,479,798 | 5,738,824 | ||
Percentage of amount assumed to net | 0.00% | 0.00% | ||
Predecessor | Life and Annuity Insurance Product Line | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 313,410 | 1,250,623 | 1,201,592 | |
Ceded to other companies | -314,991 | -1,257,453 | -1,208,376 | |
Assumed from other companies | 1,581 | 6,830 | 6,784 | |
Percentage of amount assumed to net | 0.00% | 0.00% | 0.00% | |
Predecessor | Accident and health insurance | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 18,489 | 80,974 | 97,272 | |
Ceded to other companies | -18,489 | -80,974 | -97,272 | |
Percentage of amount assumed to net | 0.00% | 0.00% | 0.00% | |
Scenario, Adjustment | ||||
Reinsurance Premiums for Insurance Companies, by Product Segment [Line Items] | ||||
Gross amount | 921,444 | |||
Ceded to other companies | -702,833 | |||
Assumed from other companies | 5,258 | |||
Net amount | $223,869 | |||
Percentage of amount assumed to net | 2.30% |