Cover Page
Cover Page - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 20, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-02658 | ||
Entity Registrant Name | STEWART INFORMATION SERVICES CORP | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 74-1677330 | ||
Entity Address, Address Line One | 1360 Post Oak Blvd., | ||
Entity Address, Address Line Two | Suite 100 | ||
Entity Address, City or Town | Houston, | ||
Entity Address, State or Province | TX | ||
Entity Address, Postal Zip Code | 77056 | ||
City Area Code | 713 | ||
Local Phone Number | 625-8100 | ||
Title of 12(b) Security | Common Stock, $1 par value per share | ||
Trading Symbol | STC | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Emerging Growth Company | false | ||
Entity Small Business | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 994.1 | ||
Entity Common Stock, Shares Outstanding | 23,679,888 | ||
Documents Incorporated by Reference | Portions of the definitive proxy statement (the Proxy Statement), in connection with the Registrant's 2020 Annual Meeting of Stockholders, are incorporated herein by reference in Part III of this document. | ||
Entity Central Index Key | 0000094344 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues | |||
Operating revenues | $ 1,877,453 | $ 1,887,882 | $ 1,934,585 |
Investment income | 19,795 | 19,737 | 18,932 |
Net realized and unrealized gains | 42,760 | 53 | 2,207 |
Revenues | 1,940,008 | 1,907,672 | 1,955,724 |
Expenses | |||
Amounts retained by agencies | 799,229 | 827,046 | 837,100 |
Employee costs | 567,173 | 562,469 | 566,178 |
Other operating expenses | 345,349 | 345,307 | 351,511 |
Title losses and related claims | 84,423 | 71,514 | 96,532 |
Depreciation and amortization | 22,526 | 24,932 | 25,878 |
Interest | 4,341 | 3,875 | 3,458 |
Total expenses | 1,823,041 | 1,835,143 | 1,880,657 |
Income before taxes and noncontrolling interests | 116,967 | 72,529 | 75,067 |
Income tax expense | 26,695 | 13,507 | 14,921 |
Net income | 90,272 | 59,022 | 60,146 |
Less net income attributable to noncontrolling interests | 11,657 | 11,499 | 11,487 |
Net income attributable to Stewart | 78,615 | 47,523 | 48,659 |
Net income attributable to Stewart | |||
Net income | 90,272 | 59,022 | 60,146 |
Other comprehensive income (loss), net of taxes: | |||
Foreign currency translation adjustments | 6,478 | (10,488) | 8,354 |
Change in net unrealized gains and losses on investments | 15,184 | (8,922) | 1,766 |
Reclassification adjustment for change in unrealized gains and losses included in net income | 410 | (922) | (2,086) |
Other comprehensive income (loss), net of taxes | 22,072 | (20,332) | 8,034 |
Comprehensive income | 112,344 | 38,690 | 68,180 |
Less comprehensive income attributable to noncontrolling interests | 11,657 | 11,499 | 11,487 |
Comprehensive income attributable to Stewart | $ 100,687 | $ 27,191 | $ 56,693 |
Basic average shares outstanding (in shares) | 23,611 | 23,543 | 23,445 |
Basic earnings per share attributable to Stewart (in usd per share) | $ 3.33 | $ 2.02 | $ 2.08 |
Diluted average shares outstanding (in shares) | 23,753 | 23,685 | 23,597 |
Diluted earnings per share attributable to Stewart (in usd per share) | $ 3.31 | $ 2.01 | $ 2.06 |
Title - Direct operations | |||
Revenues | |||
Operating revenues | $ 869,457 | $ 833,200 | $ 862,392 |
Title - Agency operations | |||
Revenues | |||
Operating revenues | 970,540 | 1,003,959 | 1,016,356 |
Ancillary services | |||
Revenues | |||
Operating revenues | $ 37,456 | $ 50,723 | $ 55,837 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Assets | ||
Cash and cash equivalents | $ 330,609 | $ 192,067 |
Short-term investments | 23,527 | 22,950 |
Investments in debt and equity securities, at fair value: | ||
Statutory reserve funds | 483,389 | 462,229 |
Other | 161,650 | 173,788 |
Investments in debt and equity securities | 645,039 | 636,017 |
Receivables: | ||
Premiums from agencies | 26,405 | 29,032 |
Trade and other | 45,962 | 43,568 |
Income taxes | 1,641 | 489 |
Notes | 2,464 | 2,987 |
Allowance for uncollectible amounts | (4,469) | (4,614) |
Total receivables | 72,003 | 71,462 |
Property and equipment, at cost: | ||
Land | 3,009 | 3,991 |
Buildings | 20,519 | 22,968 |
Furniture and equipment | 178,416 | 216,498 |
Accumulated depreciation | (151,483) | (182,663) |
Total property and equipment, at cost | 50,461 | 60,794 |
Operating lease assets | 99,028 | |
Title plants, at cost | 72,627 | 74,737 |
Investments in investees, on an equity method basis | 6,169 | 8,590 |
Goodwill | 248,890 | 248,890 |
Intangible assets, net of amortization | 4,623 | 9,727 |
Deferred tax assets, net | 4,407 | 4,575 |
Other assets | 35,402 | 43,121 |
Total assets | 1,592,785 | 1,372,930 |
Liabilities | ||
Accounts payable and accrued liabilities | 126,779 | 109,283 |
Operating lease liabilities | 113,843 | |
Notes payable | 110,632 | 108,036 |
Estimated title losses | 459,053 | 461,560 |
Deferred tax liabilities, net | 28,719 | 14,214 |
Total liabilities | 839,026 | 693,093 |
Contingent liabilities and commitments | ||
Stockholders’ equity | ||
Common Stock – $1 par, authorized 51,500,000; issued 24,061,568 and 24,071,508; outstanding 23,709,407 and 23,719,347, respectively | 24,062 | 24,072 |
Additional paid-in capital | 164,217 | 162,642 |
Retained earnings | 564,392 | 514,248 |
Accumulated other comprehensive (loss) income: | ||
Foreign currency translation adjustments | (13,027) | (19,505) |
Net unrealized gains (losses) on investments available-for-sale | 10,328 | (5,266) |
Treasury stock – 352,161 common shares, at cost, for 2019 and 2018 (including 145,820 shares held by a subsidiary) | (2,666) | (2,666) |
Total stockholders’ equity attributable to Stewart | 747,306 | 673,525 |
Noncontrolling interests | 6,453 | 6,312 |
Total stockholders’ equity | 753,759 | 679,837 |
Total liabilities and stockholders' equity | $ 1,592,785 | $ 1,372,930 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in usd per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 51,500,000 | 51,500,000 |
Common stock, shares issued (in shares) | 24,061,568 | 24,071,508 |
Common stock, shares outstanding (in shares) | 23,709,407 | 23,719,347 |
Treasury stock, common shares (in shares) | 352,161 | 352,161 |
Subsidiaries | ||
Treasury stock, common shares (in shares) | 145,820 | 145,820 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of net income to cash provided by operating activities: | |||
Net income | $ 90,272 | $ 59,022 | $ 60,146 |
Add (deduct): | |||
Depreciation and amortization | 22,526 | 24,932 | 25,878 |
Provision for bad debt | 1,672 | 519 | 207 |
Net realized and unrealized losses (gains) | 7,240 | (53) | (2,207) |
Amortization of net premium on debt securities investments | 4,939 | 6,083 | 6,806 |
Payments for title losses (in excess of) less than provisions | (6,585) | (11,192) | 13,694 |
Adjustments for insurance recoveries of title losses | 181 | 1,039 | (654) |
(Increase) decrease in receivables – net | (2,917) | 5,280 | (7,667) |
Decrease (increase) in other assets – net | 6,865 | 4,469 | (4,512) |
Increase (decrease) in payables and accrued liabilities – net | 31,471 | (12,002) | 1,933 |
Change in net deferred income taxes | 8,669 | 256 | 8,328 |
Net income from equity investees | (3,044) | (1,940) | (2,163) |
Dividends received from equity investees | 2,721 | 2,551 | 2,493 |
Stock-based compensation expense | 2,097 | 4,809 | 5,303 |
Other – net | 252 | 404 | 483 |
Cash provided (used) by operating activities | 166,359 | 84,177 | 108,068 |
Investing activities: | |||
Proceeds from sales of investments in securities | 50,605 | 49,442 | |
Proceeds from sales of investments in securities | 76,942 | ||
Proceeds from matured investments in debt securities | 48,716 | 29,631 | 33,912 |
Purchases of investments in securities | (77,489) | (43,057) | |
Purchases of investments in securities | (179,732) | ||
Net (purchases) sales of short-term investments | (639) | 392 | (1,362) |
Purchases of property and equipment, title plants and real estate | (17,075) | (10,675) | (16,396) |
Proceeds from the sale of land, buildings, property and equipment, and real estate | 1,349 | 82 | 502 |
Net cash paid for acquisition of subsidiaries and other assets | 0 | (18,739) | (17,359) |
Other – net | 1,573 | 2,303 | 458 |
Cash provided (used) by investing activities | 7,040 | 9,379 | (103,035) |
Financing activities: | |||
Proceeds from notes payable | 30,464 | 14,530 | 56,493 |
Payments on notes payable | (27,868) | (20,118) | (56,467) |
Purchase of remaining interest of consolidated subsidiaries | 0 | (1,101) | (1,810) |
Cash dividends paid | (28,345) | (28,263) | (28,135) |
Distributions to noncontrolling interests | (11,506) | (11,631) | (11,651) |
Repurchases of Common Stock | (532) | (1,175) | (727) |
Other - net | 25 | 0 | (1,298) |
Cash used by financing activities | (37,762) | (47,758) | (43,595) |
Effects of changes in foreign currency exchange rates | 2,905 | (3,810) | 2,869 |
Increase (decrease) in cash and cash equivalents | 138,542 | 41,988 | (35,693) |
Cash and cash equivalents at beginning of year | 192,067 | 150,079 | 185,772 |
Cash and cash equivalents at end of year | 330,609 | 192,067 | 150,079 |
Net changes in financial statement amounts due to purchase of subsidiaries and other assets: | |||
Goodwill acquired | 0 | 17,462 | 14,334 |
Intangible assets acquired | 0 | 4,570 | 2,598 |
Receivables and other assets acquired (disposed) | 0 | 1,209 | (60) |
Liabilities (recognized) disposed | 0 | (4,294) | 327 |
Net realized (gains) losses on the transactions | 0 | (208) | 160 |
Net cash paid for acquisition of subsidiaries and other assets | 0 | 18,739 | 17,359 |
Assets purchased through capital lease obligations | 0 | 4,312 | 2,477 |
Income taxes – net paid (refunded) | 11,992 | 12,854 | (1,642) |
Interest paid | $ 4,241 | $ 4,214 | $ 3,466 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Common Stock | Additional paid-in capital | Accumulated other comprehensive income (loss) | Retained Earnings | Treasury stock | Noncontrolling interests |
Beginning balance at Dec. 31, 2016 | $ 648,848 | $ 23,783 | $ 157,176 | $ (8,881) | $ 471,788 | $ (2,666) | $ 7,648 |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) attributable to Stewart | 48,659 | 48,659 | |||||
Dividends on Common Stock ($1.20 per share) | (28,749) | (28,749) | |||||
Stock compensation | 5,303 | 306 | 4,997 | ||||
Stock repurchases | (727) | (17) | (710) | ||||
Purchase of remaining interest of consolidated subsidiary | (1,810) | (1,509) | (301) | ||||
Net change in unrealized gains and losses on investments (net of tax) | 1,766 | 1,766 | |||||
Net realized gain reclassification (net of tax) | (2,086) | (2,086) | |||||
Foreign currency translation (net of tax) | 8,354 | 8,354 | |||||
Net income attributable to noncontrolling interests | 11,487 | 11,487 | |||||
Distributions to noncontrolling interests | (11,651) | (11,651) | |||||
Net effect of changes in ownership and other | (584) | (584) | |||||
Ending balance at Dec. 31, 2017 | 678,810 | 24,072 | 159,954 | (847) | 491,698 | (2,666) | 6,599 |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) attributable to Stewart | 47,523 | 47,523 | |||||
Dividends on Common Stock ($1.20 per share) | (28,565) | (28,565) | |||||
Stock compensation | 4,809 | 29 | 4,780 | ||||
Stock repurchases | (1,175) | (29) | (1,146) | ||||
Purchase of remaining interest of consolidated subsidiary | (1,101) | (946) | (155) | ||||
Net change in unrealized gains and losses on investments (net of tax) | (8,922) | (8,922) | |||||
Net realized gain reclassification (net of tax) | (922) | (922) | |||||
Foreign currency translation (net of tax) | (10,488) | (10,488) | |||||
Net income attributable to noncontrolling interests | 11,499 | 11,499 | |||||
Distributions to noncontrolling interests | (11,631) | (11,631) | |||||
Ending balance at Dec. 31, 2018 | 679,837 | 24,072 | 162,642 | (24,771) | 514,248 | (2,666) | 6,312 |
Increase (Decrease) in Stockholders' Equity | |||||||
Net income (loss) attributable to Stewart | 78,615 | 78,615 | |||||
Dividends on Common Stock ($1.20 per share) | (28,471) | (28,471) | |||||
Stock compensation | 2,097 | 3 | 2,094 | ||||
Stock repurchases | (532) | (13) | (519) | ||||
Net change in unrealized gains and losses on investments (net of tax) | 15,184 | 15,184 | |||||
Net realized gain reclassification (net of tax) | 410 | 410 | |||||
Foreign currency translation (net of tax) | 6,478 | 6,478 | |||||
Net income attributable to noncontrolling interests | 11,657 | 11,657 | |||||
Distributions to noncontrolling interests | (11,506) | (11,506) | |||||
Net effect of changes in ownership and other | (10) | (10) | |||||
Ending balance at Dec. 31, 2019 | $ 753,759 | $ 24,062 | $ 164,217 | $ (2,699) | $ 564,392 | $ (2,666) | $ 6,453 |
CONSOLIDATED STATEMENTS OF EQ_2
CONSOLIDATED STATEMENTS OF EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | |||
Dividends on common stock per share (in usd per share) | $ 1.2 | $ 1.2 | $ 1.2 |
General
General | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
General | General. Stewart Information Services Corporation, through its subsidiaries (collectively, the Company), is primarily engaged in the business of providing title insurance and real estate transaction related services. The Company is a global real estate services company, offering products and services through its directly owned policy-issuing offices, network of independent agencies and other businesses within the Company. The Company provides its products and services to homebuyers and sellers; residential and commercial real estate professionals; mortgage lenders and servicers; title agencies and real estate attorneys; and home builders. The Company also provides services to large mortgage lenders and servicers, mortgage brokers and mortgage investors which are primarily related to search and valuation services (referred to as ancillary services operations). The Company operates in the United States (U.S.) and internationally, primarily in Canada, the United Kingdom, Australia and Central Europe. Approximately 47% of consolidated title revenues for the year ended December 31, 2019 were generated in Texas, New York, California, Florida and international markets (principally Canada). A. Management’s responsibility. The accompanying consolidated financial statements were prepared by management, who is responsible for their integrity and objectivity. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (GAAP), including management’s best judgments and estimates. Actual results could differ from those estimates. B. Consolidation. The consolidated financial statements include all subsidiaries in which the Company owns more than 50% voting rights in electing directors. All significant intercompany amounts and transactions have been eliminated and provisions have been made for noncontrolling interests. Unconsolidated investees, in which the Company typically owns 20% through 50% of the entity, are accounted for by the equity method. C. Statutory accounting. Stewart Title Guaranty Company (Guaranty) and other title insurance underwriters owned by the Company prepare financial statements in accordance with statutory accounting practices prescribed or permitted by regulatory authorities. In conforming the statutory financial statements to GAAP, statutory premium reserves and reserves for known title losses are eliminated and, in substitution, amounts are established for estimated title losses (Note 1-E), for which the net effect, after providing for income taxes, is included in the consolidated statements of income and comprehensive income. Additionally, investments in debt securities, which are carried at amortized cost for statutory accounting, are reported at fair value and the net unrealized gains and losses, net of applicable deferred taxes, on the investments are included as a component of accumulated other comprehensive income (loss) (AOCI) within stockholders’ equity. D. Revenues. Direct premiums - Premiums from title insurance policies directly issued or issued by affiliate offices are recognized at the time of the closing of the related real estate transaction. Agency premiums - Premiums from title insurance policies written by independent agencies are recognized when the policies are reported to the Company. In addition, where reasonable estimates can be made, the Company accrues for policies issued but not reported until after period end. The Company believes that reasonable estimates can be made when recent and consistent policy issuance information is available. Estimates are based on historical reporting patterns and other information obtained about independent agencies, as well as current trends in direct operations and in the title industry. In this accrual, future transactions are not being estimated. The Company is estimating revenues on policies that have already been issued by independent agencies but not yet reported to or received by the Company. Escrow fees - An escrow is a transaction pursuant to an agreement of a buyer, seller, borrower, or lender wherein an impartial third party, such as the Company, acts in a fiduciary capacity on behalf of the parties in accordance with the terms of such agreement in order to accomplish the directions stated therein. Services provided include, among others, acting as escrow or other fiduciary agent, obtaining releases, and conducting the actual closing or settlement. Escrow fees are recognized upon closing of the escrow, which is generally at the same time of the closing of the related real estate transaction. Search, abstract and valuation services - These services are primarily related to establishing the ownership, legal status and valuation of the property in a real estate transaction. In these cases, the Company does not issue a title insurance policy or perform duties of an escrow agent. Revenues from these services are recognized upon delivery of the service to the customer. Other revenues - These revenues consist primarily of fees related to tax-deferred property exchange services, information technology products related to real property records and closing settlement services, income from equity investees, and other services performed to facilitate the closing of real estate transactions. For those products and services that are delivered at a point in time, the related revenue is recognized upon delivery based on the unit price of the product or service. For those products and services where delivery occurs over time, the related revenue is recognized ratably over the duration of the contract. Refer to Notes 18 and 19 for the breakdown of the Company's operating revenues. E. Title losses and related claims. The Company's liability for estimated title losses comprises estimates of both known claims and incurred but unreported claims expected to be paid in the future for policies issued as of the balance sheet date. This liability represents the aggregate future payments, net of recoveries, that the Company expects to make related to policy claims. The Company’s method for recording reserves for title losses on both an interim and annual basis begins with the calculation of its current loss provision rate, which is applied to the Company’s current premiums resulting in a title loss expense for the period. This loss provision rate is set to provide for estimated losses on current year policies and is determined using moving average ratios of recent actual policy loss payment experience (net of recoveries) to premium revenues. At each quarter end, the Company’s recorded reserve for title losses begins with the prior period’s reserve balance for claim losses, adds the current period provision to that balance and subtracts actual paid claims, resulting in an amount that management compares to its actuarially-based calculation of the ending reserve balance necessary to provide for future reported title losses. The actuarially-based calculation is a paid loss development calculation where loss development factors are selected based on company data and input from the Company’s third-party actuaries. The Company also obtains input from third-party actuaries in the form of a reserve analysis utilizing generally accepted actuarial methods. While the Company is responsible for determining its loss reserves, it utilizes this actuarial input to assess the overall reasonableness of its reserve estimation. If the Company’s recorded reserve amount is not at the third-party actuarial point estimate, but is within a reasonable range (+ 5.0% /- 4.0% ) of its actuarially-based reserve calculation and the actuary’s point estimate, the Company’s management assesses the major factors contributing to the different reserve estimates in order to determine the overall reasonableness of its recorded reserve, as well as the position of the recorded reserves relative to the point estimate and the estimated range of reserves. The major factors considered can change from period to period and include items such as current trends in the real estate industry (which management can assess although there is a time lag in the development of this data for use by the actuary), the size and types of claims reported and changes in the Company’s claims management process. If the recorded amount is not within a reasonable range of the Company’s third-party actuary’s point estimate, the Company will adjust the recorded reserves in the current period and reassess the provision rate on a prospective basis. Once the Company’s reserve for title losses is recorded, it is reduced in future periods as a result of claims payments and may be increased or reduced by revisions to the Company’s estimate of the overall level of required reserves. Large claims (those exceeding $1.0 million on a single claim), including large title losses due to independent agency defalcations, are analyzed and reserved for separately due to the higher dollar amount of loss, lower volume of claims reported and sporadic reporting of such claims. Due to the inherent uncertainty in predicting future title policy losses, significant judgment is required by both the Company’s management and its third party actuaries in estimating reserves. As a consequence, the Company’s ultimate liability may be materially greater or less than its current reserves and/or its third party actuary’s calculated estimate. F. Cash equivalents. Cash equivalents are highly liquid investments with insignificant interest rate risks and maturities of three months or less at the time of acquisition. G. Short-term investments. Short-term investments comprise time deposits with banks, federal government obligations and other investments maturing in less than one year. H. Investments in debt and equity securities. Investments in debt securities are classified as available-for-sale and the net unrealized gains and losses on such investments, net of applicable deferred taxes, are included as a component of AOCI within stockholders' equity. Realized gains and losses on sales of investments are determined using the specific identification method. At the time unrealized gains and losses become realized, they are reclassified from AOCI using the specific identification method. Other-than-temporary declines in fair values of investments in debt securities are charged to income. Fair value changes relating to investments in equity securities are recognized as part of net realized and unrealized gains and losses in the consolidated statements of income and comprehensive income beginning on January 1, 2018, as a result of the Company's adoption of Accounting Standards Update No. (ASU) 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities . Previously, investments in equity securities, which consist of common stocks and master limited partnership interests, were accounted for similar to investments in debt securities. In accordance with its adoption of ASU 2016-01 effective January 1, 2018, the Company reclassified outstanding net unrealized investment gains, net of taxes, of $ 4.6 million relating to investments in equity securities previously carried in AOCI to retained earnings in the 2018 consolidated statement of equity. I. Property and equipment. Depreciation is principally computed using the straight-line method using the following estimated useful lives: buildings – 30 to 40 years and furniture and equipment – 3 to 5 years. Maintenance and repairs are expensed as incurred while improvements are capitalized. Gains and losses are recognized at disposal. J. Title plants. Title plants include compilations of a county’s official land records, prior title examination files, copies of prior title policies, maps and related materials that are geographically indexed to a specific property. The costs of acquiring existing title plants and creating new ones, prior to the time such plants are placed in operation, are capitalized. Title plants are not amortized since there is no indication of any loss of value over time but are subject to review for impairment. The costs of maintaining and operating title plants are expensed as incurred. Gains and losses on sales of copies of title plants or interests in title plants are recognized at the time of sale. K. Impairment of long-lived assets. The Company reviews the carrying values of title plants and other long-lived assets if certain events occur that may indicate impairment. An impairment of these long-lived assets is indicated when projected undiscounted cash flows over the estimated lives of the assets are less than carrying values. If impairment is indicated, the recorded amounts are written down to fair values. During the year ended December 31, 2019 , the Company recorded approximately $9.9 million of impairment on title plants, buildings and other long-lived assets which was included as part of net realized and unrealized gains in the 2019 consolidated statement of income and comprehensive income. L. Goodwill. Goodwill is not amortized, but is reviewed annually during the third quarter using June 30 balances, or whenever occurrences of events indicate a potential impairment at the reporting unit level. The Company evaluates goodwill based on four reporting units with goodwill balances - direct operations, agency operations, international operations and ancillary services. Under GAAP, the Company has an option to assess qualitative factors to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount. In performing the qualitative assessment, the Company considers factors that include macroeconomic conditions, industry and market considerations, overall actual and expected financial performance, market perspective on the Company, as well as other relevant events and circumstances determined by management. The Company evaluates the weight of each factor to determine whether an impairment more-likely-than-not exists. If the Company decides not to use a qualitative assessment or if the reporting unit fails the qualitative assessment, the quantitative impairment analysis is performed. The quantitative analysis involves the comparison of the fair value of each reporting unit to its carrying amount. Goodwill impairment is calculated as the excess of the reporting unit's carrying amount over the estimated fair value and is charged to current operations. While the Company is responsible for assessing whether an impairment of goodwill exists, inputs from third-party appraisers are utilized in performing the quantitative analysis. The Company estimates the fair value using a combination of the income approach (discounted cash flow (DCF) technique) and the market approach (guideline company and precedent transaction analyses). The DCF model utilizes historical and projected operating results and cash flows, initially driven by estimates of changes in future revenue levels, and risk-adjusted discount rates. Projected operating results are primarily driven by anticipated mortgage originations, which are obtained from projections by industry experts, for the title reporting units and expected contractual revenues for the ancillary services reporting unit. Fluctuations in revenues, followed by the ability to appropriately adjust employee count and other operating expenses, or large and unanticipated adjustments to title loss reserves, are the primary reasons for increases or decreases in the projected operating results. Market-based valuation methodologies utilize (i) market multiples of earnings and/or other operating metrics of comparable companies and (ii) the Company's market capitalization and a control premium based on market data. Goodwill is assigned to the reporting units at the time the goodwill is initially recorded. Once assigned to a reporting unit, the goodwill is pooled and no longer attributable to a specific acquisition. All activities within a reporting unit are available to support the carrying value of the goodwill. When a business component within a reporting unit is disposed, goodwill is allocated to the component based on the ratio of the component's fair value over the total fair value of the reporting unit. M. Other intangibles. Other intangible assets are comprised principally of non-compete, underwriting and customer relationship agreements and acquired software. Intangible assets are amortized over their estimated lives, which are primarily 3 to 10 years. These intangible assets are reviewed for impairment when certain events or changes in circumstances occur that indicate that the carrying amount of an asset may not be recoverable. The Company performs an analysis to determine whether the carrying amount of each intangible asset is recoverable. The carrying amount is not recoverable when it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. For any intangible asset that is not recoverable, the Company calculates the excess of the carrying amount of the intangible asset over its fair value, estimated using the income approach (DCF technique). The resulting difference of the carrying amount over the fair value is treated as the impairment of the asset and is charged to current operations. N. Fair values. The fair values of financial instruments, including cash and cash equivalents, short-term investments, notes receivable, notes payable and accounts payable, are determined by the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal, or most advantageous, market for the asset or liability in an orderly transaction between market participants at the measurement date. The net fair values of these financial instruments approximate their carrying values. Investments in debt and equity securities and certain financial instruments are carried at their fair values. O. Leases. The following accounting policy is in accordance with the Company's adoption of the new lease accounting standard effective January 1, 2019. Refer to Note 1-Q for additional details on the adoption. The Company primarily leases office space, storage units, data centers and equipment, and determines if an arrangement is a lease at inception. Operating leases are included in operating lease assets and operating lease liabilities on the consolidated balance sheets. Operating lease assets represent the right to use the underlying leased assets over the corresponding lease terms. Finance leases are included in furniture and equipment and notes payable on the consolidated balance sheets. Operating lease assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The discount rate used in determining the present value of the future lease payments is based on the Company's incremental borrowing rate and is applied using a portfolio approach. Lease options to extend or terminate that the Company is reasonably certain to exercise are considered in the present value calculation. Operating lease expense, which is calculated on a straight-line basis over the lease term and presented as part of other operating expenses in the statement of income and comprehensive income, is composed of the amortization of the lease asset and the accretion of the lease liability. Finance lease expense is composed of the depreciation of the lease asset and accretion of the lease liability and presented as part of depreciation and amortization and interest expense, respectively, in the consolidated statements of income and comprehensive income. The Company accounts for the lease and non-lease fixed payment components of a lease agreement as a single lease component for all its classes of assets. Variable lease payments are not capitalized and are recorded as lease expense when incurred or paid. Operating leases with initial terms of 12 months or less (short-term leases), which are not reasonably certain to be extended at the commencement date, are not capitalized on the balance sheet. Additionally, operating leases of equipment are not recorded on the balance sheet on the basis that they are relatively short-term in nature and considered as not material to the consolidated balance sheet. P. Income taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the tax basis and the book carrying values of certain assets and liabilities. To the extent that the Company does not believe its deferred tax assets meet the more-likely-than-not realization criteria, it establishes a valuation allowance. When it establishes a valuation allowance, or increases (decreases) the allowance during the year, it records a tax expense (benefit) in its consolidated statements of operations and comprehensive income (loss). Enacted tax rates are used in calculating amounts. The Company provides for uncertainties in income taxes by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Interest and penalties, if any, are included in income tax expense. Q. Recently adopted accounting pronouncements. In February 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-02, Topic 842: Leases (Topic 842) which updated the current guidance related to leases to increase transparency and comparability among organizations. Most prominent among the changes in the standard is the recognition of right-of-use lease assets and lease liabilities on the balance sheet by lessees for those leases classified as operating leases. Additional financial statement disclosures are required to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. Topic 842 permits adoption using either a modified retrospective approach or an optional transition method. The optional transition method allows the application of the recognition and measurement requirements of the standard in the period of adoption and requires annual disclosures using the legacy lease guidance in Topic 840 for comparative periods (refer to Note 15). The Company adopted Topic 842 effective January 1, 2019 using the optional transition method of adoption. In addition, the Company elected practical expedients permitted under the transition guidance of the standard, which among other things, allowed the carry forward of the historical lease classifications for existing leases. The adoption resulted in the recognition on the Company's January 1, 2019 consolidated balance sheet of approximately $ 99.8 million of operating lease assets and lease liabilities, and the reclassification of approximately $ 10.7 million of existing deferred rent liabilities from accounts payable and accrued liabilities to operating lease assets. There was no impact on the Company's 2019 consolidated statements of income and comprehensive income and cash flows. The accounting treatment for finance leases remained substantially unchanged. R. Recent significant accounting pronouncements not yet adopted. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (Topic 326). Topic 326 significantly changed the impairment model for financial instruments by introducing the current expected credit loss (CECL) model, which requires the immediate recognition of estimated credit losses expected to occur over the remaining life of the financial instrument. Current practice generally requires the recognition of credit losses when incurred. Topic 326 also amended certain accounting treatments for available-for-sale debt securities. Topic 326 is effective for the Company's fiscal year beginning January 1, 2020 and subsequent interim periods. The Company's adoption of Topic 326 effective January 1, 2020 is not expected to result in any material impact on its consolidated financial statements. S. Merger Agreement Termination. On March 18, 2018, the Company entered into an agreement and plan of merger (Merger Agreement) with Fidelity National Financial, Inc. (FNF), A Holdco Corp. and S Holdco LLC, pursuant to which, subject to the satisfaction or waiver of certain conditions, the Company was to be acquired by FNF. On September 9, 2019, the Company and FNF mutually terminated the Merger Agreement. In connection with the termination and as stipulated in the Merger Agreement, FNF paid the Company a merger termination fee of $50 million , which was included as part of net realized and unrealized gains in the 2019 consolidated statement of income and comprehensive income. |
Restrictions on cash and invest
Restrictions on cash and investments | 12 Months Ended |
Dec. 31, 2019 | |
Cash and Cash Equivalents [Abstract] | |
Restrictions on cash and investments | Restrictions on cash and investments. The Company maintains investments in accordance with certain statutory requirements in the states of domicile of our underwriters for the funding of statutory premium reserves. Statutory reserve funds are required to be fully funded and invested in high-quality securities and short-term investments. Statutory reserve funds are not available for current claim payments, which must be funded from current operating cash flow. Included in investments in debt and equity securities are statutory reserve funds of approximately $483.4 million and $462.2 million at December 31, 2019 and 2018 , respectively. In addition, included within cash and cash equivalents are statutory reserve funds of approximately $39.7 million and $37.7 million at December 31, 2019 and 2018 , respectively. Although these cash statutory reserve funds are not restricted or segregated in depository accounts, they are required to be held pursuant to state statutes. If the Company fails to maintain minimum investments or cash and cash equivalents sufficient to meet statutory requirements, the Company may be subject to fines or other penalties, including potential revocation of its business license. These funds are not available for any other purpose. In the event that insurance regulators adjust the determination of the statutory premium reserves of the Company’s title insurers, these restricted funds as well as statutory surplus would correspondingly increase or decrease. A substantial majority of consolidated cash and investments at each year end was held by the Company’s title insurance subsidiaries. Generally, the types of investments a title insurer can make are subject to legal restrictions. Furthermore, the transfer of funds by a title insurer to its parent or subsidiary operations, as well as other related party transactions, is restricted by law and generally requires the approval of state insurance authorities (see Note 3). |
Statutory surplus and dividend
Statutory surplus and dividend restrictions | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Statutory surplus and dividend restrictions | Statutory surplus and dividend restrictions. Substantially all of the consolidated retained earnings at each year end were represented by Guaranty, which owns substantially all of the subsidiaries included in the consolidation. Guaranty cannot pay a dividend to its parent in excess of certain limits without the approval of the Texas Insurance Commissioner. The maximum dividend that can be paid after such approval is approximately $115.0 million in both 2020 and 2019. Guaranty paid dividends of $25.0 million and $20.0 million in 2018 , and 2017 , respectively, and none in 2019. Dividends from Guaranty are also voluntarily restricted primarily to maintain statutory surplus and liquidity at competitive levels and to demonstrate significant claims payment ability. The ability of a title insurer to pay claims can significantly affect the decision of lenders and other customers when buying a policy from a particular insurer. Surplus as regards policyholders (sum of statutory capital plus surplus) for Guaranty was $617.9 million and $574.8 million at December 31, 2019 and 2018 , respectively. Statutory net income for Guaranty was $38.3 million , $74.2 million and $47.7 million in 2019 , 2018 and 2017 , respectively. The amount of statutory capital and surplus necessary to satisfy regulatory requirements for Guaranty was $2.0 million (and in the aggregate less than $2.0 million for all of the Company’s underwriter subsidiaries) at December 31, 2019 , and each of its underwriter entities was in compliance with such requirements as of December 31, 2019 . |
Investments in debt and equity
Investments in debt and equity securities | 12 Months Ended |
Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in debt and equity securities | Investments in debt and equity securities. The total fair values of the Company's investments in debt and equity securities as of December 31 are detailed below: 2019 2018 ($000 omitted) Investments in: Debt securities 605,721 602,020 Equity securities 39,318 33,997 645,039 636,017 As of December 31, 2019 and 2018, included in the above fair values of investments in equity securities were net unrealized investment gains of $6.9 million and $2.9 million , respectively. The amortized costs and fair values of investments in debt securities as of December 31, are as follows: 2019 2018 Amortized costs Fair values Amortized costs Fair values ($000 omitted) Municipal 52,176 53,823 61,779 61,934 Corporate 299,074 309,142 333,289 328,495 Foreign 234,734 236,073 200,667 198,938 U.S. Treasury Bonds 6,664 6,683 12,951 12,653 592,648 605,721 608,686 602,020 The Company believes its investment portfolio is diversified and expects no material loss to result from the failure to perform by issuers of the debt securities it holds. Investments made by the Company are not collateralized. Foreign debt securities primarily include Canadian government and corporate bonds, with aggregate fair values of $206.5 million and $171.2 million as of December 31, 2019 and 2018 , respectively, and United Kingdom treasury and corporate bonds with aggregate fair values of $24.1 million and $23.0 million as of December 31, 2019 and 2018 , respectively. Gross unrealized gains and losses on investments in debt securities at December 31, were: 2019 2018 Gains Losses Gains Losses ($000 omitted) Municipal 1,649 2 482 327 Corporate 10,091 23 1,894 6,688 Foreign 2,362 1,023 1,402 3,131 U.S. Treasury Bonds 60 41 2 300 14,162 1,089 3,780 10,446 Debt securities at December 31, 2019 mature, according to their contractual terms, as follows (actual maturities may differ due to call or prepayment rights): Amortized costs Fair values ($000 omitted) In one year or less 68,377 68,517 After one year through five years 336,402 341,773 After five years through ten years 157,147 162,778 After ten years 30,722 32,653 592,648 605,721 Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2019 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 2 53 — — 2 53 Corporate 23 7,420 — — 23 7,420 Foreign 318 92,108 705 55,875 1,023 147,983 U.S. Treasury Bonds — — 41 2,215 41 2,215 343 99,581 746 58,090 1,089 157,671 The number of specific debt securities investment holdings in an unrealized loss position as of December 31, 2019 was 50 . Of these securities, 26 were in unrealized loss positions for more than 12 months. During 2019, the overall gross unrealized losses on debt securities improved compared to the prior year-end, primarily due to reduced interest rates and credit spreads which increased investment fair values. Since the Company does not intend to sell and will more-likely-than-not maintain each investment until its maturity or anticipated recovery, and no significant credit risk is deemed to exist, these investments are not considered as other-than-temporarily-impaired. The Company believes its investment portfolio is diversified and expects no material loss to result from the failure to perform by issuers of the debt securities it holds. Investments made by the Company are not collateralized. Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2018 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 91 13,366 236 11,645 327 25,011 Corporate 4,416 201,965 2,272 71,044 6,688 273,009 Foreign 158 11,424 2,973 137,793 3,131 149,217 U.S. Treasury Bonds — — 300 12,544 300 12,544 4,665 226,755 5,781 233,026 10,446 459,781 Investment income and net realized and unrealized gains. Income from investments and net realized and unrealized gains for the years ended December 31 are detailed below: 2019 2018 2017 ($000 omitted) Investment income: Debt securities 15,769 17,431 17,222 Short-term investments, cash equivalents and other 4,026 2,306 1,710 19,795 19,737 18,932 Net realized and unrealized gains: Realized gains 53,465 2,698 4,997 Realized losses (14,747 ) (483 ) (2,790 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) — 42,760 53 2,207 In 2019, net realized and unrealized gains included $50.0 million realized gain related to the merger termination fee paid by FNF (refer to Note 1-S), $4.0 million of net unrealized investment gains on equity securities held at year-end and $2.5 million of realized gains from sales of securities investments, partially offset by $14.7 million of impairment expenses primarily related to title plants, buildings, intangible assets, equity-method investments and other assets (refer to Notes 1-K, 8 and 9). In 2018, net realized and unrealized gains included $1.3 million of realized gains from sales of equity investments with no previously readily determinable fair values and $2.2 million of net unrealized investment losses on equity securities held at year-end. In 2017, net realized gains included $ 3.2 million of net realized gains from the sale of securities investments, partially offset by $ 0.8 million of net realized loss due to an increase in the fair value of a contingent consideration liability related to a prior acquisition. Net investment gains and losses recognized in 2019 and 2018 related to investments in equity securities (refer to Note 1-H) are calculated as follows: 2019 2018 ($000 omitted) Total net investment gains (losses) recognized on equity securities during the period 4,825 (2,538 ) Less: Net realized gains (losses) on equity securities sold during the period 783 (376 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) Proceeds from sales of investments in securities for the years ended December 31 are as follows: 2019 2018 2017 ($000 omitted) Proceeds from sales of debt securities 46,834 43,556 68,649 Proceeds from sales of equity securities 3,771 5,886 8,293 Total proceeds from sales of investments in securities 50,605 49,442 76,942 |
Fair value measurements
Fair value measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair value measurements | Fair value measurements. The Fair Value Measurements and Disclosures Topic of the FASB Accounting Standards Codification (ASC) defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal, or most advantageous, market for the asset or liability in an orderly transaction between market participants at the measurement date. This guidance establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. This hierarchy requires entities to maximize the use of observable inputs when possible. The three levels of inputs used to measure fair value are as follows: • Level 1 – quoted prices in active markets for identical assets or liabilities; • Level 2 – observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data; and • Level 3 – unobservable inputs that are supported by little or no market activity and that are significant to the fair values of the assets or liabilities, including certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. At December 31, 2019 , financial instruments measured at fair value on a recurring basis are summarized below: Level 1 Level 2 Level 3 Fair value measurements ($000 omitted) Investments in securities: Debt securities: Municipal — 53,823 — 53,823 Corporate — 309,142 — 309,142 Foreign — 236,073 — 236,073 U.S. Treasury Bonds — 6,683 — 6,683 Equity securities: 39,318 — — 39,318 39,318 605,721 — 645,039 At December 31, 2018 , financial instruments measured at fair value on a recurring basis are summarized below: Level 1 Level 2 Level 3 Fair value measurements ($000 omitted) Investments in securities: Debt securities: Municipal — 61,934 — 61,934 Corporate — 328,495 — 328,495 Foreign — 198,938 — 198,938 U.S. Treasury Bonds — 12,653 — 12,653 Equity securities: 33,997 — — 33,997 33,997 602,020 — 636,017 At December 31, 2019 , Level 1 financial instruments consist of equity securities. Level 2 financial instruments consist of municipal, governmental, and corporate bonds, both U.S. and foreign. In accordance with the Company’s policies and guidelines which incorporate relevant statutory requirements, the Company’s third-party registered investment manager invests only in securities rated as investment grade or higher by the major rating services, where observable valuation inputs are significant. The fair value of the Company's investments in debt and equity securities is primarily determined using a third-party pricing service provider. The third-party pricing service provider calculates the fair values using both market approach and model valuation methods, as well as pricing information obtained from brokers, dealers and custodians. Management ensures the reasonableness of the third-party service valuations by comparing them with pricing information from the Company's investment manager. |
Investment income and net reali
Investment income and net realized and unrealized gains | 12 Months Ended |
Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investment income and net realized and unrealized gains | Investments in debt and equity securities. The total fair values of the Company's investments in debt and equity securities as of December 31 are detailed below: 2019 2018 ($000 omitted) Investments in: Debt securities 605,721 602,020 Equity securities 39,318 33,997 645,039 636,017 As of December 31, 2019 and 2018, included in the above fair values of investments in equity securities were net unrealized investment gains of $6.9 million and $2.9 million , respectively. The amortized costs and fair values of investments in debt securities as of December 31, are as follows: 2019 2018 Amortized costs Fair values Amortized costs Fair values ($000 omitted) Municipal 52,176 53,823 61,779 61,934 Corporate 299,074 309,142 333,289 328,495 Foreign 234,734 236,073 200,667 198,938 U.S. Treasury Bonds 6,664 6,683 12,951 12,653 592,648 605,721 608,686 602,020 The Company believes its investment portfolio is diversified and expects no material loss to result from the failure to perform by issuers of the debt securities it holds. Investments made by the Company are not collateralized. Foreign debt securities primarily include Canadian government and corporate bonds, with aggregate fair values of $206.5 million and $171.2 million as of December 31, 2019 and 2018 , respectively, and United Kingdom treasury and corporate bonds with aggregate fair values of $24.1 million and $23.0 million as of December 31, 2019 and 2018 , respectively. Gross unrealized gains and losses on investments in debt securities at December 31, were: 2019 2018 Gains Losses Gains Losses ($000 omitted) Municipal 1,649 2 482 327 Corporate 10,091 23 1,894 6,688 Foreign 2,362 1,023 1,402 3,131 U.S. Treasury Bonds 60 41 2 300 14,162 1,089 3,780 10,446 Debt securities at December 31, 2019 mature, according to their contractual terms, as follows (actual maturities may differ due to call or prepayment rights): Amortized costs Fair values ($000 omitted) In one year or less 68,377 68,517 After one year through five years 336,402 341,773 After five years through ten years 157,147 162,778 After ten years 30,722 32,653 592,648 605,721 Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2019 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 2 53 — — 2 53 Corporate 23 7,420 — — 23 7,420 Foreign 318 92,108 705 55,875 1,023 147,983 U.S. Treasury Bonds — — 41 2,215 41 2,215 343 99,581 746 58,090 1,089 157,671 The number of specific debt securities investment holdings in an unrealized loss position as of December 31, 2019 was 50 . Of these securities, 26 were in unrealized loss positions for more than 12 months. During 2019, the overall gross unrealized losses on debt securities improved compared to the prior year-end, primarily due to reduced interest rates and credit spreads which increased investment fair values. Since the Company does not intend to sell and will more-likely-than-not maintain each investment until its maturity or anticipated recovery, and no significant credit risk is deemed to exist, these investments are not considered as other-than-temporarily-impaired. The Company believes its investment portfolio is diversified and expects no material loss to result from the failure to perform by issuers of the debt securities it holds. Investments made by the Company are not collateralized. Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2018 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 91 13,366 236 11,645 327 25,011 Corporate 4,416 201,965 2,272 71,044 6,688 273,009 Foreign 158 11,424 2,973 137,793 3,131 149,217 U.S. Treasury Bonds — — 300 12,544 300 12,544 4,665 226,755 5,781 233,026 10,446 459,781 Investment income and net realized and unrealized gains. Income from investments and net realized and unrealized gains for the years ended December 31 are detailed below: 2019 2018 2017 ($000 omitted) Investment income: Debt securities 15,769 17,431 17,222 Short-term investments, cash equivalents and other 4,026 2,306 1,710 19,795 19,737 18,932 Net realized and unrealized gains: Realized gains 53,465 2,698 4,997 Realized losses (14,747 ) (483 ) (2,790 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) — 42,760 53 2,207 In 2019, net realized and unrealized gains included $50.0 million realized gain related to the merger termination fee paid by FNF (refer to Note 1-S), $4.0 million of net unrealized investment gains on equity securities held at year-end and $2.5 million of realized gains from sales of securities investments, partially offset by $14.7 million of impairment expenses primarily related to title plants, buildings, intangible assets, equity-method investments and other assets (refer to Notes 1-K, 8 and 9). In 2018, net realized and unrealized gains included $1.3 million of realized gains from sales of equity investments with no previously readily determinable fair values and $2.2 million of net unrealized investment losses on equity securities held at year-end. In 2017, net realized gains included $ 3.2 million of net realized gains from the sale of securities investments, partially offset by $ 0.8 million of net realized loss due to an increase in the fair value of a contingent consideration liability related to a prior acquisition. Net investment gains and losses recognized in 2019 and 2018 related to investments in equity securities (refer to Note 1-H) are calculated as follows: 2019 2018 ($000 omitted) Total net investment gains (losses) recognized on equity securities during the period 4,825 (2,538 ) Less: Net realized gains (losses) on equity securities sold during the period 783 (376 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) Proceeds from sales of investments in securities for the years ended December 31 are as follows: 2019 2018 2017 ($000 omitted) Proceeds from sales of debt securities 46,834 43,556 68,649 Proceeds from sales of equity securities 3,771 5,886 8,293 Total proceeds from sales of investments in securities 50,605 49,442 76,942 |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes. In 2017, the U.S. enacted the Tax Cuts and Jobs Act (the 2017 Act), which revised the U.S. corporate income tax regime by, among other things, lowering the corporate tax rate from 35% to 21% effective on January 1, 2018 and imposing a one-time transition tax on deemed repatriated earnings of foreign subsidiaries. As a result, the Company recorded provisional amounts in 2017 that included (i) net income tax benefits of $ 7.8 million, consisting of a $ 7.2 million federal benefit and a $ 0.6 million state benefit, related to the remeasurement of deferred tax assets and liabilities and (ii) an income tax expense of $ 1.2 million related to the transition tax on deemed repatriation of deferred foreign income. In 2018, the Company completed its determination of the tax effects of the 2017 Act and recorded an additional $0.8 million of federal and state income tax benefits related to the remeasurement of deferred tax assets and liabilities and $0.6 million of reduced income tax expense related to the one-time deemed repatriation. Effective January 1, 2018, the Company adopted ASU 2018-02, Income Statement - Reporting Comprehensive Income, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income , which provided a one-time option to reclassify the stranded tax effects of the 2017 Act from AOCI directly to retained earnings. The stranded tax effects resulted from the remeasurement of deferred tax assets and liabilities which were originally recorded in comprehensive income but whose remeasurement is reflected in the income statement. The Company reclassified $ 1.0 million of net tax expense from AOCI to retained earnings in the 2018 consolidated statement of equity as a result of the adoption. Income tax expense consists of the following: 2019 2018 2017 ($000 omitted) Current income tax expense: Federal 12,329 5,540 1,154 State 846 1,089 814 Foreign 4,851 6,622 4,625 18,026 13,251 6,593 Deferred income tax expense (benefit): Federal 6,631 43 4,088 State 150 (864 ) (254 ) Foreign 1,888 1,077 4,494 8,669 256 8,328 Total income tax expense 26,695 13,507 14,921 The following reconciles income tax expense computed at the federal statutory rate with income tax expense as reported: 2019 2018 2017 ($000 omitted) Expected income tax expense at 21% in 2019 and 2018 and 35% in 2017 (1) 22,116 12,816 22,253 Nondeductible expenses 3,249 1,872 2,610 Valuation allowance 1,326 1,741 — Net expense (benefit) for the Canadian branch (2) 613 128 (1,480 ) Return-to-provision and true-up adjustments (776 ) (370 ) 923 Research and development credits (278 ) (732 ) (2,158 ) 2017 Act impact from the U.S. corporate tax rate change — (745 ) (7,196 ) 2017 Act impact from deemed repatriation of deferred foreign income — (624 ) 1,213 Other – net (3) 445 (579 ) (1,244 ) Income tax expense 26,695 13,507 14,921 Effective income tax rate (1) 25.3 % 22.1 % 23.5 % (1) Calculated using income before taxes and after noncontrolling interests. (2) For U.S. income tax purposes, the Company’s Canadian operation is a branch of Guaranty. As a result, the Canadian net deferred tax liability is offset in the U.S. as a deferred tax asset but not in an equal amount given differing tax rates in Canada and the U.S. (3) Included within this line are $0.1 million and $0.6 million , respectively, of 2018 and 2017 net income tax benefits from the remeasurement of the state deferred tax assets and liabilities relating to the 2017 Act. Deferred tax assets and liabilities resulting from the same tax jurisdiction are netted and presented as either an asset or liability on the consolidated balance sheets. Deferred tax assets and liabilities resulting from different tax jurisdictions are not netted. Deferred tax assets and liabilities as of December 31 are detailed below. 2019 2018 ($000 omitted) Deferred tax assets: Accrued expenses 18,290 16,013 Federal offset to Canadian deferred tax liability 7,961 6,618 Net operating loss (NOL) carryforwards 7,017 6,936 Tax credit carryforwards 2,230 1,477 Foreign currency translation adjustments 1,765 3,194 Allowance for uncollectible amounts 983 1,023 Net unrealized losses on investments in securities 621 1,205 Investments 424 857 Capitalized expenses — 2,356 Other 1,370 1,235 Deferred tax assets – gross 40,661 40,914 Valuation allowance (4,056 ) (3,824 ) Deferred tax assets – net 36,605 37,090 Deferred tax liabilities: Title loss provisions (29,704 ) (21,936 ) Amortization – goodwill and other intangibles (22,379 ) (19,891 ) Net unrealized gains on investments in securities (4,218 ) — Deferred compensation on life insurance policies (2,202 ) (2,029 ) Fixed assets (1,997 ) (1,917 ) Other (417 ) (956 ) Deferred tax liabilities – gross (60,917 ) (46,729 ) Net deferred income tax liability (24,312 ) (9,639 ) At December 31, 2019 , the Company had $2.2 million of foreign tax credit carryforwards that will begin to expire in 2028. The future utilization of these credit carryforwards is subject to various limitations. The Company's $7.0 million of deferred tax assets relating to NOL carryforwards include losses from various states and will expire in varying amounts from 2020 through 2039, and foreign losses which will expire in varying amounts from 2020 through 2023 or have unlimited carryforward periods. The future utilization of all NOL carryforwards is subject to various limitations. The Company's valuation allowance at December 31, 2019 relates primarily to all foreign tax credit carryforwards and certain state and foreign NOL carryforwards which the Company believes are not more-likely-than-not to be utilized prior to expiration. |
Goodwill and other intangibles
Goodwill and other intangibles | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangibles | Goodwill and other intangibles. The summary of changes in goodwill is as follows: Title Ancillary Services and Corporate Total ($000 omitted) Balances at January 1, 2018 225,699 5,729 231,428 Acquisitions 17,504 — 17,504 Disposals (42 ) — (42 ) Balances at December 31, 2018 and 2019 243,161 5,729 248,890 The Company evaluates goodwill for impairment annually based on information as of June 30 of the current year or more frequently if circumstances suggest that impairment may exist. Utilizing the quantitative impairment analysis approach in 2019 and 2018, the Company determined that goodwill related to all of its reporting units was not impaired. During 2018, the Company acquired several title businesses which increased goodwill related to the title segment by a total of $17.5 million , which is substantially deductible for income tax purposes over a period of 15 years. Also, in connection with the acquisitions, the Company identified and recorded $4.5 million of other intangibles, primarily related to employment and non-compete agreements, to be amortized between one year to three years from the dates of acquisition. The gross carrying amount, and accumulated amortization and impairment of other intangibles was $35.0 million and $30.4 million , respectively, at December 31, 2019 and $35.0 million and $25.3 million , respectively, at December 31, 2018 . The amortization expense recorded for the Company's other intangible assets was $4.2 million and $4.6 million in 2019 and 2018 , respectively. Additionally, an impairment expense of $ 0.9 million was recorded as part of net realized and unrealized gains in the consolidated statement of income and comprehensive income during 2019 for other intangible assets that were no longer providing economic benefits. The annual amortization expense expected to be recognized in the next five years relating to other intangible assets is approximately $ 2.3 million in 2020, $ 0.9 million in 2021, $ 0.4 million in 2022, $ 0.2 million in 2023 and $ 0.2 million in 2024. |
Equity investees
Equity investees | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity investees | Equity investees. Summarized aggregate financial information for equity investees (in which the Company typically owns 20% through 50% of the equity) is as follows: 2019 2018 2017 ($000 omitted) For the year: Revenues 19,660 22,286 25,351 Net income 6,231 4,729 4,997 At December 31: Total assets 36,865 33,268 32,171 Notes payable 27,841 24,833 20,902 Stockholders’ equity 6,341 6,292 9,023 Net premium revenues from policies issued by equity investees were approximately $0.7 million , $2.1 million and $2.1 million in 2019 , 2018 and 2017 , respectively. Income related to equity investees was $3.0 million , $1.9 million and $2.2 million in 2019 , 2018 and 2017 , respectively. These amounts are included in title insurance – direct operations in the consolidated statements of income and comprehensive income. Goodwill related to equity investees was $4.6 million and $7.3 million as of December 31, 2019 and 2018 , respectively, and was included in investments in investees in the consolidated balance sheets. Equity investments, including the related goodwill balances, are reviewed for impairment annually and upon the occurrence of an event that may indicate an impairment. The Company recorded an impairment of $2.7 million on a disposal of an equity investment during 2019 which was included in net realized and unrealized gains in the consolidated statement of income and comprehensive income. No impairment was recorded during the years ended December 31, 2018 and 2017. |
Notes payable
Notes payable | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Notes payable | Notes payable. A summary of notes payable is as follows: 2019 2018 ($000 omitted) Line of credit facility (1) 98,875 98,875 Other notes payable 11,757 9,161 110,632 108,036 (1) Average interest rates were 3.55% and 3.58% during the years ended December 31, 2019 and 2018 , respectively. Based upon the contractual maturities, principal payments on the above notes are due in the amounts of $9.8 million in 2020, $0.9 million in 2021, $0.9 million in 2022, and $99.0 million in 2023. Included within other notes payable are $3.7 million and $6.5 million of capital lease obligations at December 31, 2019 and 2018 , respectively. Prior to November 2018, the Company had an available $125.0 million unsecured line of credit commitment (Credit Agreement), which was used for general corporate purposes, including acquisitions, and was previously scheduled to expire in October 2019. In November 2018, the Company entered into an amended and restated credit agreement (Amended Credit Agreement) which increased the available unsecured line of credit commitment to $150.0 million and extended the maturity of the line of credit to November 2023. Under the Amended Credit Agreement, borrowings bear interest, at the Company's election, at either (a) an Alternate Base Rate plus the Applicable Rate (ABR Borrowing) or (b) LIBOR plus the Applicable Rate (Eurodollar Borrowing). The Applicable Rate, based on the Company's Leverage Ratio, ranges from 0.375% to 0.50% per annum for ABR Borrowings and 1.375% to 1.75% per annum for Eurodollar Borrowings based on the Company's consolidated Leverage Ratio. Also, a commitment fee accrues ranging from 0.20% to 0.35% per annum on the average daily unused portion of the line of credit commitment. Also, under the terms of the Amended Credit Agreement, the Company may at any time, subject to certain conditions, request an increase of up to $50.0 million in the amount of the line of credit. The Amended Credit Agreement contains customary affirmative and negative covenants, which include certain consolidated financial covenants providing that (a) the ratio of EBITDA (as defined in the Amended Credit Agreement) to fixed charges (as defined in the Amended Credit Agreement) not be below 1.15 to 1.00 on a trailing four-quarter basis (Fixed Charge Ratio); (b) the ratio of total Indebtedness to EBITDA for the prior four consecutive quarters must not be greater than 3.50 to 1.00 (Leverage Ratio); (c) Capital Expenditures in the aggregate for the Company in any calendar year may not exceed $30.0 million , with certain allowances for carryover of unused amounts; and (d) Restricted Payments (as defined in the Amended Credit Agreement) should not exceed $40.0 million annually. As of December 31, 2019 , line of credit borrowings of $98.9 million were outstanding and the remaining balance of the line of credit available for use was $48.6 million , net of an unused $2.5 million letter of credit. The Company was in compliance with all covenants as of December 31, 2019 and 2018, under the Amended Credit Agreement and Credit Agreement, respectively. The Company's qualified intermediary in tax-deferred property exchanges pursuant to Section 1031 of the Internal Revenue Code (Section 1031) enters into short-term loan agreements with parties to an exchange in the ordinary course of its business. The outstanding balances pursuant to these loans, as included within notes payable - other than banks in the above table, were $8.0 million and $2.6 million as of December 31, 2019 and 2018, respectively, and are secured by cash that is included in cash and cash equivalents on the Company's consolidated balance sheet. Borrowings and repayments on these short-term loans are reflected as financing activities in the consolidated statements of cash flows. |
Estimated title losses
Estimated title losses | 12 Months Ended |
Dec. 31, 2019 | |
Loss Contingency [Abstract] | |
Estimated title losses | Estimated title losses. A summary of estimated title losses is as follows: 2019 2018 2017 ($000 omitted) Balances at January 1 461,560 480,990 462,572 Provisions: Current year 79,141 70,480 90,401 Previous policy years 5,282 1,034 6,131 Total provisions 84,423 71,514 96,532 Payments, net of recoveries: Current year (19,052 ) (17,460 ) (20,335 ) Previous policy years (71,956 ) (65,246 ) (63,914 ) Total payments, net of recoveries (91,008 ) (82,706 ) (84,249 ) Effects of changes in foreign currency exchange rates 4,078 (8,238 ) 6,135 Balances at December 31 459,053 461,560 480,990 Loss ratios as a percentage of title operating revenues: Current year provisions 4.3 % 3.8 % 4.8 % Total provisions 4.6 % 3.9 % 5.1 % Total title loss provisions during 2019, compared to 2018, increased primarily due to unfavorable loss experience in 2019, resulting in a higher current year policy provisioning rate and increased provisions in portions of the Company's non-Canadian international operations, and a prior policy year reserve reduction during 2018. Total provisions in 2018 decreased from 2017, primarily due to favorable loss experience in 2018, which resulted in a lower current year policy provisioning rate and a $4.0 million prior policy year reserve reduction. The $5.3 million and $6.1 million net increases in the loss reserve estimates for prior year policy years during 2019 and 2017 were primarily driven by large title claims reported during those years. Total provisions for large title claims related to prior policy years were $6.0 million , $4.4 million and $4.3 million in 2019 , 2018 and 2017 , respectively. |
Share-based payments
Share-based payments | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Share-based payments | Share-based payments. Prior to 2018, the Company granted executives and senior management shares of restricted common stock, consisting of time-based shares, which vest on each of the first three anniversaries of the grant date, and performance-based shares, which vest upon achievement of certain financial objectives over the period of three years . Starting in 2018, the Company began granting time-based and performance-based restricted stock units, which have vesting conditions generally similar to the restricted common stock shares awarded previously. Each restricted stock unit represents a contractual right to receive a share of the Company's common stock. The fair value of each restricted common stock or unit granted is based on the closing price of the Company's common stock at grant date. The aggregate grant-date fair values of restricted share and unit awards during 2019, 2018 and 2017 were $5.1 million ( 122,400 shares with an average grant price of $42.02 ), $4.8 million ( 110,600 shares with an average grant price of $43.39 ) and $5.7 million ( 133,000 shares with an average grant price of $42.59 ), respectively. Awards were made pursuant to the Company’s employee incentive compensation plans and the compensation expense associated with the restricted share-based awards is recognized over the corresponding vesting period as part of employee costs in the consolidated statements of income and comprehensive income. Award forfeitures are recorded as credits against employee costs in the period in which they occur. Additionally, in 2019, 2018 and 2017, the Company granted its board of directors, as a component of their annual director retainer compensation, approximately 13,700 , 14,300 and 13,000 shares, respectively, of common stock that had aggregate fair values of $0.6 million each year. The 2018 and 2017 grants immediately vested at grant date, while the 2019 grants had a one-year restriction. The associated expense for these grants is recognized in other operating expenses in the consolidated statements of income and comprehensive income. A summary of the restricted common stock award activity during the year ended December 31, 2019 is presented below: Shares Weighted-Average Grant-Date Fair Value per Share ($) Nonvested balance at January 1, 2019 120,276 40.99 Granted 13,702 41.26 Adjustment for performance-based shares (40,297 ) 42.32 Vested (33,532 ) 39.82 Forfeited (6,760 ) 42.50 Nonvested balance at December 31, 2019 53,389 40.60 A summary of the restricted common stock unit activity during the year ended December 31, 2019 is presented below: Units Weighted-Average Grant-Date Fair Value per Share ($) Nonvested balance at January 1, 2019 123,841 42.67 Granted 122,358 42.02 Vested (17,003 ) 42.14 Forfeited (33,179 ) 43.21 Nonvested balance at December 31, 2019 196,017 42.21 The fair value of shares that vested in 2019 and 2018 aggregated to $2.1 million and $4.2 million , respectively. For the years ended December 31, 2019, 2018 and 2017, compensation costs recognized in the consolidated statements of income and comprehensive income, presented primarily within employee costs, were approximately $2.1 million , $4.8 million and $5.3 million , respectively. The total tax benefits recognized in the consolidated statements of income and comprehensive income from tax deductions relating to vesting of restricted common stock awards in 2019, 2018 and 2017 were $0.5 million , $1.1 million and $1.2 million , respectively. As of December 31, 2019, compensation costs not yet recognized related to nonvested restricted common stock awards was $4.1 million , which is expected to be recognized over a weighted average period of 1.7 years. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share. Basic earnings per share (EPS) attributable to Stewart is calculated by dividing net income attributable to Stewart by the weighted-average number of shares of Common Stock outstanding during the reporting periods. Outstanding shares of Common Stock granted to employees that are not yet vested (restricted shares) are excluded from the calculation of the weighted-average number of shares outstanding for calculating basic EPS. To calculate diluted EPS, the number of shares is adjusted to include the number of additional shares that would have been outstanding if the restricted shares and restricted units were vested. In periods of loss, dilutive shares are excluded from the calculation of the diluted EPS and diluted EPS is computed in the same manner as basic EPS. The calculation of the basic and diluted EPS is as follows: For the Years Ended 2019 2018 2017 ($000 omitted) Numerator: Net income attributable to Stewart 78,615 47,523 48,659 Denominator (000): Basic average shares outstanding 23,611 23,543 23,445 Average number of dilutive shares relating to restricted shares and units 142 142 152 Diluted average shares outstanding 23,753 23,685 23,597 Basic earnings per share attributable to Stewart 3.33 2.02 2.08 Diluted earnings per share attributable to Stewart 3.31 2.01 2.06 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2019 | |
Insurance [Abstract] | |
Reinsurance | Reinsurance. As is industry practice, the Company cedes risks to other title insurance underwriters and reinsurers on certain transactions. However, the Company remains liable if the reinsurer should fail to meet its obligations. The Company also assumes risks from other underwriters on a transactional basis as well as on certain reinsurance treaties. Payments and recoveries on reinsured losses were insignificant during each of the years ended December 31, 2019 , 2018 , and 2017 . The total amount of premiums for assumed and ceded risks was less than 1.0% of consolidated title revenues in each of the last three years and there were no |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases. Total operating lease expense was $42.5 million , $40.8 million and $40.8 million in 2019 , 2018 and 2017 , respectively. Included in the 2019 operating lease expense was $4.2 million of lease expense related to short-term leases and equipment. Total finance lease expense was $2.4 million , $3.8 million and $3.1 million in 2019 , 2018 and 2017 , respectively. Lease-related assets and liabilities as of December 31, 2019 are as follows ($000 omitted): Assets: Operating lease assets, net of accumulated amortization 99,028 Finance lease assets, net of accumulated depreciation 4,312 Total lease assets 103,340 Liabilities: Operating lease liabilities 113,843 Finance lease liabilities 3,716 Total lease liabilities 117,559 Other information related to operating and finance leases during the year ended December 31, 2019 is as follows: Operating Finance Cash paid for amounts included in the measurement of lease liabilities ($000) 43,207 3,076 Lease assets obtained in exchange for lease obligations ($000) 51,188 — Weighted average remaining lease term (years): 4.7 2.5 Weighted average discount rate 4.4 % 4.7 % Future minimum lease payments under operating and finance leases as of December 31, 2019 are as follows: Operating Finance ($000 omitted) 2020 37,835 1,913 2021 28,926 957 2022 21,702 957 2023 15,892 80 2024 12,209 — Thereafter 14,652 — Total future minimum lease payments 131,216 3,907 Less: imputed interest (17,373 ) (191 ) Net future minimum lease payments 113,843 3,716 As required by the Company's adoption of Topic 842 using the optional transition method (refer to Note 1-Q), below were the future minimum lease payments relating to operating leases as of December 31, 2018 (in thousands of dollars): 2019 40,664 2020 27,064 2021 17,663 2022 11,521 2023 6,677 2024 and after 8,923 112,512 |
Leases | Leases. Total operating lease expense was $42.5 million , $40.8 million and $40.8 million in 2019 , 2018 and 2017 , respectively. Included in the 2019 operating lease expense was $4.2 million of lease expense related to short-term leases and equipment. Total finance lease expense was $2.4 million , $3.8 million and $3.1 million in 2019 , 2018 and 2017 , respectively. Lease-related assets and liabilities as of December 31, 2019 are as follows ($000 omitted): Assets: Operating lease assets, net of accumulated amortization 99,028 Finance lease assets, net of accumulated depreciation 4,312 Total lease assets 103,340 Liabilities: Operating lease liabilities 113,843 Finance lease liabilities 3,716 Total lease liabilities 117,559 Other information related to operating and finance leases during the year ended December 31, 2019 is as follows: Operating Finance Cash paid for amounts included in the measurement of lease liabilities ($000) 43,207 3,076 Lease assets obtained in exchange for lease obligations ($000) 51,188 — Weighted average remaining lease term (years): 4.7 2.5 Weighted average discount rate 4.4 % 4.7 % Future minimum lease payments under operating and finance leases as of December 31, 2019 are as follows: Operating Finance ($000 omitted) 2020 37,835 1,913 2021 28,926 957 2022 21,702 957 2023 15,892 80 2024 12,209 — Thereafter 14,652 — Total future minimum lease payments 131,216 3,907 Less: imputed interest (17,373 ) (191 ) Net future minimum lease payments 113,843 3,716 As required by the Company's adoption of Topic 842 using the optional transition method (refer to Note 1-Q), below were the future minimum lease payments relating to operating leases as of December 31, 2018 (in thousands of dollars): 2019 40,664 2020 27,064 2021 17,663 2022 11,521 2023 6,677 2024 and after 8,923 112,512 |
Contingent liabilities and comm
Contingent liabilities and commitments | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingent liabilities and commitments | Contingent liabilities and commitments. The Company routinely holds third-party funds in segregated escrow accounts pending the closing of real estate transactions resulting in a contingent liability to the Company of approximately $1.3 billion at December 31, 2019 . In addition, the Company is contingently liable for disbursements of escrow funds held by independent agencies in those cases where specific insured closing guarantees have been issued. The Company owns a qualified intermediary engaged in Section 1031 tax-deferred property exchanges. The Company holds the proceeds from these transactions until a qualifying exchange can occur. This resulted in a contingent liability to the Company of approximately $1.1 billion at December 31, 2019 . As is industry practice, escrow and Section 1031 exchanger fund accounts are not included in the consolidated balance sheets. In the ordinary course of business, the Company guarantees the third-party indebtedness of certain of its consolidated subsidiaries. As of December 31, 2019 , the maximum potential future payments on the guarantees are not more than the related notes payable recorded in the consolidated balance sheets (refer to Note 10). The Company also guarantees the indebtedness related to lease obligations of certain of its consolidated subsidiaries. The maximum future obligations arising from these lease-related guarantees are not more than the Company’s future lease obligations (refer to Note 15) plus lease operating expenses. As of December 31, 2019 , the Company also had unused letters of credit aggregating $5.4 million related to workers’ compensation coverage and other insurance. The Company does not expect to make any payments on these guarantees. |
Regulatory and legal developmen
Regulatory and legal developments | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Regulatory and legal developments | Regulatory and legal developments. The Company is subject to claims and lawsuits arising in the ordinary course of its business, most of which involve disputed policy claims. In some of these lawsuits, the plaintiff seeks exemplary or treble damages in excess of policy limits. The Company does not expect that any of these ordinary course proceedings will have a material adverse effect on its consolidated financial condition or results of operations. The Company believes that it has adequate reserves for the various litigation matters and contingencies discussed in this paragraph and that the likely resolution of these matters will not materially affect its consolidated financial condition or results of operations. Additionally, the Company receives from time to time various other inquiries from governmental regulators concerning practices in the insurance industry. Many of these practices do not concern title insurance. To the extent the Company is in receipt of such inquiries, it believes that it has adequately reserved for these matters and does not anticipate that the outcome of these inquiries will materially affect its consolidated financial condition or results of operations. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues. The Company's operating revenues, summarized by type, are as follows: 2019 2018 2017 ($000 omitted) Title insurance premiums: Direct 615,646 597,510 602,858 Agency 970,540 1,003,959 1,016,356 Escrow fees 137,539 124,660 142,463 Search, abstract and valuation services 82,050 92,708 96,703 Other revenues 71,678 69,045 76,205 1,877,453 1,887,882 1,934,585 |
Segment information
Segment information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment information | Segment information. The Company reports two operating segments: title and ancillary services and corporate . The title segment provides services needed to transfer title to property in a real estate transaction and includes services such as searching, examining, closing and insuring the condition of the title to the property. In addition, the title segment includes home and personal insurance services and Section 1031 tax-deferred exchanges. The ancillary services and corporate segment includes search and valuation services, which are the principal offerings of ancillary services, and expenses of the parent holding company and certain other enterprise-wide overhead costs, net of centralized administrative services costs allocated to respective operating businesses. Selected statement of income information related to these segments for the years ended December 31 is as follows: 2019 2018 2017 ($000 omitted) Title segment: Revenues 1,857,048 1,855,706 1,899,462 Depreciation and amortization 19,971 21,449 21,384 Income before taxes and noncontrolling interest 108,459 108,314 103,361 Ancillary services and corporate segment: Revenues 82,960 51,966 56,262 Depreciation and amortization 2,555 3,483 4,494 Income (loss) before taxes and noncontrolling interest 8,508 (35,785 ) (28,294 ) Consolidated Stewart: Revenues 1,940,008 1,907,672 1,955,724 Depreciation and amortization 22,526 24,932 25,878 Income before taxes and noncontrolling interest 116,967 72,529 75,067 Reported revenues and income before taxes and noncontrolling interest for the ancillary services and corporate segment included a $50.0 million pretax realized gain related to the merger termination fee paid by FNF (refer to Note 1-S). The Company does not provide asset information by reportable operating segment as it does not routinely evaluate the asset position by segment. Revenues for the years ended December 31 in the United States and all international operations are as follows: 2019 2018 2017 ($000 omitted) United States 1,816,531 1,787,843 1,825,186 International 123,477 119,829 130,538 1,940,008 1,907,672 1,955,724 |
Other comprehensive income (los
Other comprehensive income (loss) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Other comprehensive income (loss) | Other comprehensive income (loss). Changes in the balances of each component of other comprehensive income (loss) and the related tax effects are as follows: For the Year Ended December 31, 2019 For the Year Ended For the Year Ended Before-Tax Amount Tax Expense (Benefit) Net-of-Tax Amount Before-Tax Amount Tax Expense (Benefit) Net-of Tax Amount Before-Tax Amount Tax Expense (Benefit) Net-of-Tax Amount ($000 omitted) ($000 omitted) ($000 omitted) Foreign currency translation adjustments 8,337 1,859 6,478 (13,336 ) (2,848 ) (10,488 ) 11,050 2,696 8,354 Net unrealized gains (losses) on investments: Change in net unrealized gains and losses on investments 19,220 4,036 15,184 (11,294 ) (2,372 ) (8,922 ) 2,718 952 1,766 Reclassification adjustment for change in unrealized gains and losses included in net income 519 109 410 (1,167 ) (245 ) (922 ) (3,210 ) (1,124 ) (2,086 ) 19,739 4,145 15,594 (12,461 ) (2,617 ) (9,844 ) (492 ) (172 ) (320 ) Other comprehensive income (loss) 28,076 6,004 22,072 (25,797 ) (5,465 ) (20,332 ) 10,558 2,524 8,034 |
Quarterly financial information
Quarterly financial information (unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial information (unaudited) | Quarterly financial information (unaudited). Mar 31 June 30 Sept 30 Dec 31 Total ($000 omitted, except per share) Revenues: 2019 398,519 472,075 559,508 509,906 1,940,008 2018 437,229 492,869 507,640 469,934 1,907,672 Net (loss) income attributable to Stewart: 2019 (6,768 ) 19,306 66,108 (31 ) 78,615 2018 (3,781 ) 22,377 17,554 11,373 47,523 Diluted (loss) earnings per share attributable to Stewart (1) : 2019 (0.29 ) 0.81 2.78 — 3.31 2018 (0.16 ) 0.95 0.74 0.48 2.01 (1) Quarterly per share data may not sum to annual totals due to rounding or effects of dilution in particular quarters but not in annual totals. |
Schedule I - Financial Informat
Schedule I - Financial Information of the Registrant (Parent Company) | 12 Months Ended |
Dec. 31, 2019 | |
Condensed Financial Information Disclosure [Abstract] | |
Schedule I - Financial Information of the Registrant (Parent Company) | SCHEDULE I STEWART INFORMATION SERVICES CORPORATION (Parent Company) STATEMENTS OF INCOME AND RETAINED EARNINGS For the Years Ended December 31, 2019 2018 2017 ($000 omitted) Revenues Merger termination fee 50,000 — — Investment income — 25,000 20,000 Other income 753 665 784 50,753 25,665 20,784 Expenses Interest 4,106 3,511 3,123 Other operating expenses, including $276 each year to affiliates 12,787 15,174 5,840 16,893 18,685 8,963 Income before taxes and income from subsidiaries 33,860 6,980 11,821 Income tax (expense) benefit (15 ) (126 ) 776 Income from subsidiaries 44,770 40,669 36,062 Net income 78,615 47,523 48,659 Retained earnings at beginning of year 514,248 491,698 471,788 Cash dividends on Common Stock (28,471 ) (28,565 ) (28,749 ) Cumulative effect adjustments on adoption of new accounting pronouncements — 3,592 — Retained earnings at end of year 564,392 514,248 491,698 See accompanying notes to financial statement information. See accompanying Report of Independent Registered Public Accounting Firm. STEWART INFORMATION SERVICES CORPORATION (Parent Company) BALANCE SHEETS As of December 31, 2019 2018 ($000 omitted) Assets Cash and cash equivalents 36,849 24,823 Receivables: Notes - due from subsidiaries 5,193 6,609 Receivables from affiliates 260 7 5,453 6,616 Property and equipment, at cost: Furniture and equipment 88 2,662 Accumulated depreciation (83 ) (2,449 ) 5 213 Investments in subsidiaries, on an equity-method basis 802,994 737,273 Operating lease assets 8,931 — Goodwill 8,470 8,470 Other assets 15,810 17,469 878,512 794,864 Liabilities Accounts payable and other liabilities 21,417 22,464 Operating lease liabilities 10,914 — Notes payable 98,875 98,875 131,206 121,339 Contingent liabilities and commitments — — Stockholders’ equity Common Stock – $1 par, authorized 51,500,000; issued 24,061,568 and 24,071,508; outstanding 23,709,407 and 23,719,347, respectively 24,062 24,072 Additional paid-in capital 164,217 162,642 Retained earnings 564,392 514,248 Accumulated other comprehensive (loss) income (AOCI): Foreign currency translation adjustments (13,027 ) (19,505 ) Net unrealized investment gains (losses) 10,328 (5,266 ) Treasury stock – 352,161 common shares, at cost (2,666 ) (2,666 ) Total stockholders’ equity 747,306 673,525 878,512 794,864 See accompanying notes to financial statement information. See accompanying Report of Independent Registered Public Accounting Firm. STEWART INFORMATION SERVICES CORPORATION (Parent Company) STATEMENTS OF CASH FLOWS For the Years Ended December 31, 2019 2018 2017 ($000 omitted) Reconciliation of net income to cash provided (used) by operating activities: Net income 78,615 47,523 48,659 Add (deduct): Depreciation 8 4 5 (Increase) decrease in receivables – net (253 ) 922 (81 ) Decrease (increase) in other assets – net 1,659 853 (1,576 ) Increase (decrease) in payables and accrued liabilities – net 2,698 (4,476 ) 563 Income from subsidiaries (44,770 ) (40,669 ) (36,062 ) Other – net 1,530 (5,124 ) 1,705 Cash provided (used) by operating activities 39,487 (967 ) 13,213 Investing activities: Dividends from subsidiary — 25,000 20,000 Collections on notes receivables 1,416 24,900 23,375 Increases in notes receivables — (5,193 ) (16,000 ) Contributions to a subsidiary — — (7,184 ) Cash provided by investing activities 1,416 44,707 20,191 Financing activities: Proceeds from notes payable — — 16,000 Payments on notes payable — — (10,000 ) Dividends paid (28,345 ) (28,263 ) (28,135 ) Repurchases of Common Stock (532 ) (1,175 ) (727 ) Purchase of remaining interest of consolidated subsidiary — (1,101 ) (1,810 ) Other – net — — — Cash used by financing activities (28,877 ) (30,539 ) (24,672 ) Increase in cash and cash equivalents 12,026 13,201 8,732 Cash and cash equivalents at beginning of year 24,823 11,622 2,890 Cash and cash equivalents at end of year 36,849 24,823 11,622 Supplemental information: Income taxes paid — — — Interest paid 4,009 3,849 3,128 See accompanying notes to financial statement information. See accompanying Report of Independent Registered Public Accounting Firm. STEWART INFORMATION SERVICES CORPORATION (Parent Company) NOTES TO FINANCIAL STATEMENT INFORMATION The Parent Company operates as a holding company, transacting substantially all of its business through its subsidiaries. Its consolidated financial statements are included in Part II, Item 8 of Form 10-K. The Parent Company financial statements should be read in conjunction with the aforementioned consolidated financial statements and notes thereto and financial statement schedules. Merger agreement . On March 18, 2018, the Company entered into an agreement and plan of merger (Merger Agreement) with Fidelity National Financial, Inc. (FNF), A Holdco Corp. and S Holdco LLC, pursuant to which, subject to the satisfaction or waiver of certain conditions, the Company was to be acquired by FNF . On September 9, 2019, the Company and FNF mutually terminated the Merger Agreement. In connection with the termination and as stipulated in the Merger Agreement, FNF paid the Company a merger termination fee of $50 million , which was presented as such in the 2019 statement of income and retained earnings. Investment income. During 2018 and 2017, Stewart Title Guaranty Company paid to the Parent Company dividends of $25.0 million and $20.0 million , respectively, and none in 2019. Other operating expenses. Other operating expenses included $ 6.8 million, $ 12.7 million and $ 2.9 million of expenses related to the Mergers and strategic alternatives review in 2019, 2018 and 2017, respectively. Also included in the 2019 other operating expenses were $ 2.2 million of executive insurance policy settlement expenses. Operating lease assets and liabilities. Beginning in 2019, we adopted the new lease accounting standard which resulted in the balance sheet recognition of assets and liabilities related to our operating leases of office space. Operating lease assets represent the right to use the underlying assets over the corresponding lease terms. This adoption did not result in any impact to our statements of operations and cash flows. Refer to Note 1-Q to the audited consolidated financial statements for details. Stockholders' equity. In 2018, the Parent Company adopted two new accounting standards which resulted in a reclassification of $ 1.0 million of net tax expense and $ 4.6 million of net unrealized investment gains from AOCI to retained earnings. Refer to Note 12 to the audited consolidated financial statements for details for these equity adjustments. Income taxes. The Parent Company consistently generates losses, exclusive of dividends or equity earnings from its subsidiaries, and is not expected to generate future income without its subsidiaries. On December 22, 2017, the United States (U.S.) enacted the Tax Cuts and Jobs Act (the 2017 Act), which revised the U.S. corporate income tax regime by, among other things, lowering the corporate tax rate from 35% to 21% effective on January 1, 2018. As a result of the 2017 Act, the Parent Company recorded an income tax benefit of $1.2 million related to the remeasurement of its deferred tax assets and liabilities at December 31, 2017. |
Schedule II - Valuation and Qua
Schedule II - Valuation and Qualifying Accounts | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE II STEWART INFORMATION SERVICES CORPORATION AND SUBSIDIARIES VALUATION AND QUALIFYING ACCOUNTS December 31, 2019 Col. A Col. B Col. C Additions Col. D Deductions Col. E Description Balance at beginning of period Charged to costs and expenses (Describe) Balance At end of period ($000 omitted) Stewart Information Services Corporation and subsidiaries: Year ended December 31, 2019: Estimated title losses 461,560 84,423 86,930 (A) 459,053 Valuation allowance for deferred tax assets 3,824 236 4 4,056 Allowance for uncollectible amounts 4,614 1,672 1,817 (B) 4,469 Year ended December 31, 2018: Estimated title losses 480,990 71,514 90,944 (A) 461,560 Valuation allowance for deferred tax assets 2,231 1,791 198 3,824 Allowance for uncollectible amounts 5,156 519 1,061 (B) 4,614 Year ended December 31, 2017: Estimated title losses 462,572 96,532 78,114 (A) 480,990 Valuation allowance for deferred tax assets 2,457 — 226 2,231 Allowance for uncollectible amounts 9,647 207 4,698 (B) 5,156 (A) Represents primarily payments of policy and escrow losses and loss adjustment expenses. (B) Represents uncollectible accounts written off. See accompanying Report of Independent Registered Public Accounting Firm. |
General (Policies)
General (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Management's responsibility | Management’s responsibility. The accompanying consolidated financial statements were prepared by management, who is responsible for their integrity and objectivity. The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (GAAP), including management’s best judgments and estimates. Actual results could differ from those estimates. |
Consolidation | Consolidation. The consolidated financial statements include all subsidiaries in which the Company owns more than 50% voting rights in electing directors. All significant intercompany amounts and transactions have been eliminated and provisions have been made for noncontrolling interests. Unconsolidated investees, in which the Company typically owns 20% through 50% of the entity, are accounted for by the equity method. |
Statutory accounting | Statutory accounting. Stewart Title Guaranty Company (Guaranty) and other title insurance underwriters owned by the Company prepare financial statements in accordance with statutory accounting practices prescribed or permitted by regulatory authorities. In conforming the statutory financial statements to GAAP, statutory premium reserves and reserves for known title losses are eliminated and, in substitution, amounts are established for estimated title losses (Note 1-E), for which the net effect, after providing for income taxes, is included in the consolidated statements of income and comprehensive income. Additionally, investments in debt securities, which are carried at amortized cost for statutory accounting, are reported at fair value and the net unrealized gains and losses, net of applicable deferred taxes, on the investments are included as a component of accumulated other comprehensive income (loss) (AOCI) within stockholders’ equity. |
Revenues | Revenues. Direct premiums - Premiums from title insurance policies directly issued or issued by affiliate offices are recognized at the time of the closing of the related real estate transaction. Agency premiums - Premiums from title insurance policies written by independent agencies are recognized when the policies are reported to the Company. In addition, where reasonable estimates can be made, the Company accrues for policies issued but not reported until after period end. The Company believes that reasonable estimates can be made when recent and consistent policy issuance information is available. Estimates are based on historical reporting patterns and other information obtained about independent agencies, as well as current trends in direct operations and in the title industry. In this accrual, future transactions are not being estimated. The Company is estimating revenues on policies that have already been issued by independent agencies but not yet reported to or received by the Company. Escrow fees - An escrow is a transaction pursuant to an agreement of a buyer, seller, borrower, or lender wherein an impartial third party, such as the Company, acts in a fiduciary capacity on behalf of the parties in accordance with the terms of such agreement in order to accomplish the directions stated therein. Services provided include, among others, acting as escrow or other fiduciary agent, obtaining releases, and conducting the actual closing or settlement. Escrow fees are recognized upon closing of the escrow, which is generally at the same time of the closing of the related real estate transaction. Search, abstract and valuation services - These services are primarily related to establishing the ownership, legal status and valuation of the property in a real estate transaction. In these cases, the Company does not issue a title insurance policy or perform duties of an escrow agent. Revenues from these services are recognized upon delivery of the service to the customer. Other revenues - These revenues consist primarily of fees related to tax-deferred property exchange services, information technology products related to real property records and closing settlement services, income from equity investees, and other services performed to facilitate the closing of real estate transactions. For those products and services that are delivered at a point in time, the related revenue is recognized upon delivery based on the unit price of the product or service. For those products and services where delivery occurs over time, the related revenue is recognized ratably over the duration of the contract. |
Title losses and related claims | Title losses and related claims. The Company's liability for estimated title losses comprises estimates of both known claims and incurred but unreported claims expected to be paid in the future for policies issued as of the balance sheet date. This liability represents the aggregate future payments, net of recoveries, that the Company expects to make related to policy claims. The Company’s method for recording reserves for title losses on both an interim and annual basis begins with the calculation of its current loss provision rate, which is applied to the Company’s current premiums resulting in a title loss expense for the period. This loss provision rate is set to provide for estimated losses on current year policies and is determined using moving average ratios of recent actual policy loss payment experience (net of recoveries) to premium revenues. At each quarter end, the Company’s recorded reserve for title losses begins with the prior period’s reserve balance for claim losses, adds the current period provision to that balance and subtracts actual paid claims, resulting in an amount that management compares to its actuarially-based calculation of the ending reserve balance necessary to provide for future reported title losses. The actuarially-based calculation is a paid loss development calculation where loss development factors are selected based on company data and input from the Company’s third-party actuaries. The Company also obtains input from third-party actuaries in the form of a reserve analysis utilizing generally accepted actuarial methods. While the Company is responsible for determining its loss reserves, it utilizes this actuarial input to assess the overall reasonableness of its reserve estimation. If the Company’s recorded reserve amount is not at the third-party actuarial point estimate, but is within a reasonable range (+ 5.0% /- 4.0% ) of its actuarially-based reserve calculation and the actuary’s point estimate, the Company’s management assesses the major factors contributing to the different reserve estimates in order to determine the overall reasonableness of its recorded reserve, as well as the position of the recorded reserves relative to the point estimate and the estimated range of reserves. The major factors considered can change from period to period and include items such as current trends in the real estate industry (which management can assess although there is a time lag in the development of this data for use by the actuary), the size and types of claims reported and changes in the Company’s claims management process. If the recorded amount is not within a reasonable range of the Company’s third-party actuary’s point estimate, the Company will adjust the recorded reserves in the current period and reassess the provision rate on a prospective basis. Once the Company’s reserve for title losses is recorded, it is reduced in future periods as a result of claims payments and may be increased or reduced by revisions to the Company’s estimate of the overall level of required reserves. Large claims (those exceeding $1.0 million on a single claim), including large title losses due to independent agency defalcations, are analyzed and reserved for separately due to the higher dollar amount of loss, lower volume of claims reported and sporadic reporting of such claims. Due to the inherent uncertainty in predicting future title policy losses, significant judgment is required by both the Company’s management and its third party actuaries in estimating reserves. As a consequence, the Company’s ultimate liability may be materially greater or less than its current reserves and/or its third party actuary’s calculated estimate. |
Cash equivalents | Cash equivalents. Cash equivalents are highly liquid investments with insignificant interest rate risks and maturities of three months or less at the time of acquisition. |
Short-term investments | Short-term investments. Short-term investments comprise time deposits with banks, federal government obligations and other investments maturing in less than one year. |
Investments in debt and equity securities | Investments in debt and equity securities. Investments in debt securities are classified as available-for-sale and the net unrealized gains and losses on such investments, net of applicable deferred taxes, are included as a component of AOCI within stockholders' equity. Realized gains and losses on sales of investments are determined using the specific identification method. At the time unrealized gains and losses become realized, they are reclassified from AOCI using the specific identification method. Other-than-temporary declines in fair values of investments in debt securities are charged to income. Fair value changes relating to investments in equity securities are recognized as part of net realized and unrealized gains and losses in the consolidated statements of income and comprehensive income beginning on January 1, 2018, as a result of the Company's adoption of Accounting Standards Update No. (ASU) 2016-01, Recognition and Measurement of Financial Assets and Financial Liabilities |
Property and equipment | Property and equipment. Depreciation is principally computed using the straight-line method using the following estimated useful lives: buildings – 30 to 40 years and furniture and equipment – 3 to 5 years. Maintenance and repairs are expensed as incurred while improvements are capitalized. Gains and losses are recognized at disposal. |
Title plants | Title plants. Title plants include compilations of a county’s official land records, prior title examination files, copies of prior title policies, maps and related materials that are geographically indexed to a specific property. The costs of acquiring existing title plants and creating new ones, prior to the time such plants are placed in operation, are capitalized. Title plants are not amortized since there is no indication of any loss of value over time but are subject to review for impairment. The costs of maintaining and operating title plants are expensed as incurred. Gains and losses on sales of copies of title plants or interests in title plants are recognized at the time of sale. |
Impairment of long-lived assets | Impairment of long-lived assets. The Company reviews the carrying values of title plants and other long-lived assets if certain events occur that may indicate impairment. An impairment of these long-lived assets is indicated when projected undiscounted cash flows over the estimated lives of the assets are less than carrying values. If impairment is indicated, the recorded amounts are written down to fair values. |
Goodwill | Goodwill. Goodwill is not amortized, but is reviewed annually during the third quarter using June 30 balances, or whenever occurrences of events indicate a potential impairment at the reporting unit level. The Company evaluates goodwill based on four reporting units with goodwill balances - direct operations, agency operations, international operations and ancillary services. Under GAAP, the Company has an option to assess qualitative factors to determine whether it is more-likely-than-not that the fair value of a reporting unit is less than its carrying amount. In performing the qualitative assessment, the Company considers factors that include macroeconomic conditions, industry and market considerations, overall actual and expected financial performance, market perspective on the Company, as well as other relevant events and circumstances determined by management. The Company evaluates the weight of each factor to determine whether an impairment more-likely-than-not exists. If the Company decides not to use a qualitative assessment or if the reporting unit fails the qualitative assessment, the quantitative impairment analysis is performed. The quantitative analysis involves the comparison of the fair value of each reporting unit to its carrying amount. Goodwill impairment is calculated as the excess of the reporting unit's carrying amount over the estimated fair value and is charged to current operations. While the Company is responsible for assessing whether an impairment of goodwill exists, inputs from third-party appraisers are utilized in performing the quantitative analysis. The Company estimates the fair value using a combination of the income approach (discounted cash flow (DCF) technique) and the market approach (guideline company and precedent transaction analyses). The DCF model utilizes historical and projected operating results and cash flows, initially driven by estimates of changes in future revenue levels, and risk-adjusted discount rates. Projected operating results are primarily driven by anticipated mortgage originations, which are obtained from projections by industry experts, for the title reporting units and expected contractual revenues for the ancillary services reporting unit. Fluctuations in revenues, followed by the ability to appropriately adjust employee count and other operating expenses, or large and unanticipated adjustments to title loss reserves, are the primary reasons for increases or decreases in the projected operating results. Market-based valuation methodologies utilize (i) market multiples of earnings and/or other operating metrics of comparable companies and (ii) the Company's market capitalization and a control premium based on market data. Goodwill is assigned to the reporting units at the time the goodwill is initially recorded. Once assigned to a reporting unit, the goodwill is pooled and no longer attributable to a specific acquisition. All activities within a reporting unit are available to support the carrying value of the goodwill. When a business component within a reporting unit is disposed, goodwill is allocated to the component based on the ratio of the component's fair value over the total fair value of the reporting unit. |
Other intangibles | Other intangibles. Other intangible assets are comprised principally of non-compete, underwriting and customer relationship agreements and acquired software. Intangible assets are amortized over their estimated lives, which are primarily 3 to 10 years. These intangible assets are reviewed for impairment when certain events or changes in circumstances occur that indicate that the carrying amount of an asset may not be recoverable. The Company performs an analysis to determine whether the carrying amount of each intangible asset is recoverable. The carrying amount is not recoverable when it exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. For any intangible asset that is not recoverable, the Company calculates the excess of the carrying amount of the intangible asset over its fair value, estimated using the income approach (DCF technique). The resulting difference of the carrying amount over the fair value is treated as the impairment of the asset and is charged to current operations. |
Fair values | Fair values. The fair values of financial instruments, including cash and cash equivalents, short-term investments, notes receivable, notes payable and accounts payable, are determined by the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal, or most advantageous, market for the asset or liability in an orderly transaction between market participants at the measurement date. The net fair values of these financial instruments approximate their carrying values. Investments in debt and equity securities and certain financial instruments are carried at their fair values. |
Leases | Leases. The following accounting policy is in accordance with the Company's adoption of the new lease accounting standard effective January 1, 2019. Refer to Note 1-Q for additional details on the adoption. The Company primarily leases office space, storage units, data centers and equipment, and determines if an arrangement is a lease at inception. Operating leases are included in operating lease assets and operating lease liabilities on the consolidated balance sheets. Operating lease assets represent the right to use the underlying leased assets over the corresponding lease terms. Finance leases are included in furniture and equipment and notes payable on the consolidated balance sheets. Operating lease assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. The discount rate used in determining the present value of the future lease payments is based on the Company's incremental borrowing rate and is applied using a portfolio approach. Lease options to extend or terminate that the Company is reasonably certain to exercise are considered in the present value calculation. Operating lease expense, which is calculated on a straight-line basis over the lease term and presented as part of other operating expenses in the statement of income and comprehensive income, is composed of the amortization of the lease asset and the accretion of the lease liability. Finance lease expense is composed of the depreciation of the lease asset and accretion of the lease liability and presented as part of depreciation and amortization and interest expense, respectively, in the consolidated statements of income and comprehensive income. The Company accounts for the lease and non-lease fixed payment components of a lease agreement as a single lease component for all its classes of assets. Variable lease payments are not capitalized and are recorded as lease expense when incurred or paid. Operating leases with initial terms of 12 months or less (short-term leases), which are not reasonably certain to be extended at the commencement date, are not capitalized on the balance sheet. Additionally, operating leases of equipment are not recorded on the balance sheet on the basis that they are relatively short-term in nature and considered as not material to the consolidated balance sheet. |
Income taxes | Income taxes. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the tax basis and the book carrying values of certain assets and liabilities. To the extent that the Company does not believe its deferred tax assets meet the more-likely-than-not realization criteria, it establishes a valuation allowance. When it establishes a valuation allowance, or increases (decreases) the allowance during the year, it records a tax expense (benefit) in its consolidated statements of operations and comprehensive income (loss). Enacted tax rates are used in calculating amounts. The Company provides for uncertainties in income taxes by prescribing a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. Interest and penalties, if any, are included in income tax expense. |
Recently adopted accounting pronouncements and Recent significant accounting pronouncements not yet adopted | Recently adopted accounting pronouncements. In February 2016, the Financial Accounting Standards Board (FASB) issued ASU 2016-02, Topic 842: Leases (Topic 842) which updated the current guidance related to leases to increase transparency and comparability among organizations. Most prominent among the changes in the standard is the recognition of right-of-use lease assets and lease liabilities on the balance sheet by lessees for those leases classified as operating leases. Additional financial statement disclosures are required to enable users of financial statements to assess the amount, timing, and uncertainty of cash flows arising from leases. Topic 842 permits adoption using either a modified retrospective approach or an optional transition method. The optional transition method allows the application of the recognition and measurement requirements of the standard in the period of adoption and requires annual disclosures using the legacy lease guidance in Topic 840 for comparative periods (refer to Note 15). The Company adopted Topic 842 effective January 1, 2019 using the optional transition method of adoption. In addition, the Company elected practical expedients permitted under the transition guidance of the standard, which among other things, allowed the carry forward of the historical lease classifications for existing leases. The adoption resulted in the recognition on the Company's January 1, 2019 consolidated balance sheet of approximately $ 99.8 million of operating lease assets and lease liabilities, and the reclassification of approximately $ 10.7 million of existing deferred rent liabilities from accounts payable and accrued liabilities to operating lease assets. There was no impact on the Company's 2019 consolidated statements of income and comprehensive income and cash flows. The accounting treatment for finance leases remained substantially unchanged. R. Recent significant accounting pronouncements not yet adopted. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (Topic 326). Topic 326 significantly changed the impairment model for financial instruments by introducing the current expected credit loss (CECL) model, which requires the immediate recognition of estimated credit losses expected to occur over the remaining life of the financial instrument. Current practice generally requires the recognition of credit losses when incurred. Topic 326 also amended certain accounting treatments for available-for-sale debt securities. Topic 326 is effective for the Company's fiscal year beginning January 1, 2020 and subsequent interim periods. The Company's adoption of Topic 326 effective January 1, 2020 is not expected to result in any material impact on its consolidated financial statements. |
Investments in debt and equit_2
Investments in debt and equity securities (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in debt and equity securities | The total fair values of the Company's investments in debt and equity securities as of December 31 are detailed below: 2019 2018 ($000 omitted) Investments in: Debt securities 605,721 602,020 Equity securities 39,318 33,997 645,039 636,017 Net investment gains and losses recognized in 2019 and 2018 related to investments in equity securities (refer to Note 1-H) are calculated as follows: 2019 2018 ($000 omitted) Total net investment gains (losses) recognized on equity securities during the period 4,825 (2,538 ) Less: Net realized gains (losses) on equity securities sold during the period 783 (376 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) |
Amortized costs and fair values | The amortized costs and fair values of investments in debt securities as of December 31, are as follows: 2019 2018 Amortized costs Fair values Amortized costs Fair values ($000 omitted) Municipal 52,176 53,823 61,779 61,934 Corporate 299,074 309,142 333,289 328,495 Foreign 234,734 236,073 200,667 198,938 U.S. Treasury Bonds 6,664 6,683 12,951 12,653 592,648 605,721 608,686 602,020 Proceeds from sales of investments in securities for the years ended December 31 are as follows: 2019 2018 2017 ($000 omitted) Proceeds from sales of debt securities 46,834 43,556 68,649 Proceeds from sales of equity securities 3,771 5,886 8,293 Total proceeds from sales of investments in securities 50,605 49,442 76,942 |
Gross unrealized gains and losses | Gross unrealized gains and losses on investments in debt securities at December 31, were: 2019 2018 Gains Losses Gains Losses ($000 omitted) Municipal 1,649 2 482 327 Corporate 10,091 23 1,894 6,688 Foreign 2,362 1,023 1,402 3,131 U.S. Treasury Bonds 60 41 2 300 14,162 1,089 3,780 10,446 |
Debt securities according to contractual terms | Debt securities at December 31, 2019 mature, according to their contractual terms, as follows (actual maturities may differ due to call or prepayment rights): Amortized costs Fair values ($000 omitted) In one year or less 68,377 68,517 After one year through five years 336,402 341,773 After five years through ten years 157,147 162,778 After ten years 30,722 32,653 592,648 605,721 |
Gross unrealized losses on investments and fair values of related securities | Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2019 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 2 53 — — 2 53 Corporate 23 7,420 — — 23 7,420 Foreign 318 92,108 705 55,875 1,023 147,983 U.S. Treasury Bonds — — 41 2,215 41 2,215 343 99,581 746 58,090 1,089 157,671 Gross unrealized losses on investments in debt securities and the fair values of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2018 , were: Less than 12 months More than 12 months Total Losses Fair values Losses Fair values Losses Fair values ($000 omitted) Municipal 91 13,366 236 11,645 327 25,011 Corporate 4,416 201,965 2,272 71,044 6,688 273,009 Foreign 158 11,424 2,973 137,793 3,131 149,217 U.S. Treasury Bonds — — 300 12,544 300 12,544 4,665 226,755 5,781 233,026 10,446 459,781 |
Fair value measurements (Tables
Fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Financial instruments measured at fair value on recurring basis | At December 31, 2019 , financial instruments measured at fair value on a recurring basis are summarized below: Level 1 Level 2 Level 3 Fair value measurements ($000 omitted) Investments in securities: Debt securities: Municipal — 53,823 — 53,823 Corporate — 309,142 — 309,142 Foreign — 236,073 — 236,073 U.S. Treasury Bonds — 6,683 — 6,683 Equity securities: 39,318 — — 39,318 39,318 605,721 — 645,039 At December 31, 2018 , financial instruments measured at fair value on a recurring basis are summarized below: Level 1 Level 2 Level 3 Fair value measurements ($000 omitted) Investments in securities: Debt securities: Municipal — 61,934 — 61,934 Corporate — 328,495 — 328,495 Foreign — 198,938 — 198,938 U.S. Treasury Bonds — 12,653 — 12,653 Equity securities: 33,997 — — 33,997 33,997 602,020 — 636,017 |
Investment income and net rea_2
Investment income and net realized and unrealized gains (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | |
Income from investments and net realized and unrealized gains | Income from investments and net realized and unrealized gains for the years ended December 31 are detailed below: 2019 2018 2017 ($000 omitted) Investment income: Debt securities 15,769 17,431 17,222 Short-term investments, cash equivalents and other 4,026 2,306 1,710 19,795 19,737 18,932 Net realized and unrealized gains: Realized gains 53,465 2,698 4,997 Realized losses (14,747 ) (483 ) (2,790 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) — 42,760 53 2,207 |
Net gains (losses) on investments in equity securities still held | The total fair values of the Company's investments in debt and equity securities as of December 31 are detailed below: 2019 2018 ($000 omitted) Investments in: Debt securities 605,721 602,020 Equity securities 39,318 33,997 645,039 636,017 Net investment gains and losses recognized in 2019 and 2018 related to investments in equity securities (refer to Note 1-H) are calculated as follows: 2019 2018 ($000 omitted) Total net investment gains (losses) recognized on equity securities during the period 4,825 (2,538 ) Less: Net realized gains (losses) on equity securities sold during the period 783 (376 ) Net unrealized investment gains (losses) recognized on equity securities still held 4,042 (2,162 ) |
Proceeds from sale of investments available-for-sale | The amortized costs and fair values of investments in debt securities as of December 31, are as follows: 2019 2018 Amortized costs Fair values Amortized costs Fair values ($000 omitted) Municipal 52,176 53,823 61,779 61,934 Corporate 299,074 309,142 333,289 328,495 Foreign 234,734 236,073 200,667 198,938 U.S. Treasury Bonds 6,664 6,683 12,951 12,653 592,648 605,721 608,686 602,020 Proceeds from sales of investments in securities for the years ended December 31 are as follows: 2019 2018 2017 ($000 omitted) Proceeds from sales of debt securities 46,834 43,556 68,649 Proceeds from sales of equity securities 3,771 5,886 8,293 Total proceeds from sales of investments in securities 50,605 49,442 76,942 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income tax expense | Income tax expense consists of the following: 2019 2018 2017 ($000 omitted) Current income tax expense: Federal 12,329 5,540 1,154 State 846 1,089 814 Foreign 4,851 6,622 4,625 18,026 13,251 6,593 Deferred income tax expense (benefit): Federal 6,631 43 4,088 State 150 (864 ) (254 ) Foreign 1,888 1,077 4,494 8,669 256 8,328 Total income tax expense 26,695 13,507 14,921 |
Reconciliation of income tax expense (benefit) at federal statutory rate | The following reconciles income tax expense computed at the federal statutory rate with income tax expense as reported: 2019 2018 2017 ($000 omitted) Expected income tax expense at 21% in 2019 and 2018 and 35% in 2017 (1) 22,116 12,816 22,253 Nondeductible expenses 3,249 1,872 2,610 Valuation allowance 1,326 1,741 — Net expense (benefit) for the Canadian branch (2) 613 128 (1,480 ) Return-to-provision and true-up adjustments (776 ) (370 ) 923 Research and development credits (278 ) (732 ) (2,158 ) 2017 Act impact from the U.S. corporate tax rate change — (745 ) (7,196 ) 2017 Act impact from deemed repatriation of deferred foreign income — (624 ) 1,213 Other – net (3) 445 (579 ) (1,244 ) Income tax expense 26,695 13,507 14,921 Effective income tax rate (1) 25.3 % 22.1 % 23.5 % (1) Calculated using income before taxes and after noncontrolling interests. (2) For U.S. income tax purposes, the Company’s Canadian operation is a branch of Guaranty. As a result, the Canadian net deferred tax liability is offset in the U.S. as a deferred tax asset but not in an equal amount given differing tax rates in Canada and the U.S. (3) Included within this line are $0.1 million and $0.6 million , respectively, of 2018 and 2017 net income tax benefits from the remeasurement of the state deferred tax assets and liabilities relating to the 2017 Act. |
Schedule of deferred tax assets and liabilities | Deferred tax assets and liabilities as of December 31 are detailed below. 2019 2018 ($000 omitted) Deferred tax assets: Accrued expenses 18,290 16,013 Federal offset to Canadian deferred tax liability 7,961 6,618 Net operating loss (NOL) carryforwards 7,017 6,936 Tax credit carryforwards 2,230 1,477 Foreign currency translation adjustments 1,765 3,194 Allowance for uncollectible amounts 983 1,023 Net unrealized losses on investments in securities 621 1,205 Investments 424 857 Capitalized expenses — 2,356 Other 1,370 1,235 Deferred tax assets – gross 40,661 40,914 Valuation allowance (4,056 ) (3,824 ) Deferred tax assets – net 36,605 37,090 Deferred tax liabilities: Title loss provisions (29,704 ) (21,936 ) Amortization – goodwill and other intangibles (22,379 ) (19,891 ) Net unrealized gains on investments in securities (4,218 ) — Deferred compensation on life insurance policies (2,202 ) (2,029 ) Fixed assets (1,997 ) (1,917 ) Other (417 ) (956 ) Deferred tax liabilities – gross (60,917 ) (46,729 ) Net deferred income tax liability (24,312 ) (9,639 ) |
Goodwill and other intangibles
Goodwill and other intangibles (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of goodwill | The summary of changes in goodwill is as follows: Title Ancillary Services and Corporate Total ($000 omitted) Balances at January 1, 2018 225,699 5,729 231,428 Acquisitions 17,504 — 17,504 Disposals (42 ) — (42 ) Balances at December 31, 2018 and 2019 243,161 5,729 248,890 |
Equity investees (Tables)
Equity investees (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of aggregate financial information for equity investees | Summarized aggregate financial information for equity investees (in which the Company typically owns 20% through 50% of the equity) is as follows: 2019 2018 2017 ($000 omitted) For the year: Revenues 19,660 22,286 25,351 Net income 6,231 4,729 4,997 At December 31: Total assets 36,865 33,268 32,171 Notes payable 27,841 24,833 20,902 Stockholders’ equity 6,341 6,292 9,023 |
Notes payable (Tables)
Notes payable (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Summary of notes payable | A summary of notes payable is as follows: 2019 2018 ($000 omitted) Line of credit facility (1) 98,875 98,875 Other notes payable 11,757 9,161 110,632 108,036 (1) Average interest rates were 3.55% and 3.58% during the years ended December 31, 2019 and 2018 , respectively. |
Estimated title losses (Tables)
Estimated title losses (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Loss Contingency [Abstract] | |
Summary of estimated title losses | A summary of estimated title losses is as follows: 2019 2018 2017 ($000 omitted) Balances at January 1 461,560 480,990 462,572 Provisions: Current year 79,141 70,480 90,401 Previous policy years 5,282 1,034 6,131 Total provisions 84,423 71,514 96,532 Payments, net of recoveries: Current year (19,052 ) (17,460 ) (20,335 ) Previous policy years (71,956 ) (65,246 ) (63,914 ) Total payments, net of recoveries (91,008 ) (82,706 ) (84,249 ) Effects of changes in foreign currency exchange rates 4,078 (8,238 ) 6,135 Balances at December 31 459,053 461,560 480,990 Loss ratios as a percentage of title operating revenues: Current year provisions 4.3 % 3.8 % 4.8 % Total provisions 4.6 % 3.9 % 5.1 % |
Share-based payments (Tables)
Share-based payments (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |
Summary of the restricted common stock award/unit activity | A summary of the restricted common stock award activity during the year ended December 31, 2019 is presented below: Shares Weighted-Average Grant-Date Fair Value per Share ($) Nonvested balance at January 1, 2019 120,276 40.99 Granted 13,702 41.26 Adjustment for performance-based shares (40,297 ) 42.32 Vested (33,532 ) 39.82 Forfeited (6,760 ) 42.50 Nonvested balance at December 31, 2019 53,389 40.60 A summary of the restricted common stock unit activity during the year ended December 31, 2019 is presented below: Units Weighted-Average Grant-Date Fair Value per Share ($) Nonvested balance at January 1, 2019 123,841 42.67 Granted 122,358 42.02 Vested (17,003 ) 42.14 Forfeited (33,179 ) 43.21 Nonvested balance at December 31, 2019 196,017 42.21 |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Basic and diluted earnings (loss) per share | The calculation of the basic and diluted EPS is as follows: For the Years Ended 2019 2018 2017 ($000 omitted) Numerator: Net income attributable to Stewart 78,615 47,523 48,659 Denominator (000): Basic average shares outstanding 23,611 23,543 23,445 Average number of dilutive shares relating to restricted shares and units 142 142 152 Diluted average shares outstanding 23,753 23,685 23,597 Basic earnings per share attributable to Stewart 3.33 2.02 2.08 Diluted earnings per share attributable to Stewart 3.31 2.01 2.06 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of lease-related assets and liabilities | Lease-related assets and liabilities as of December 31, 2019 are as follows ($000 omitted): Assets: Operating lease assets, net of accumulated amortization 99,028 Finance lease assets, net of accumulated depreciation 4,312 Total lease assets 103,340 Liabilities: Operating lease liabilities 113,843 Finance lease liabilities 3,716 Total lease liabilities 117,559 |
Other information related to operating and finance leases | Other information related to operating and finance leases during the year ended December 31, 2019 is as follows: Operating Finance Cash paid for amounts included in the measurement of lease liabilities ($000) 43,207 3,076 Lease assets obtained in exchange for lease obligations ($000) 51,188 — Weighted average remaining lease term (years): 4.7 2.5 Weighted average discount rate 4.4 % 4.7 % |
Future minimum lease payments under operating leases | Future minimum lease payments under operating and finance leases as of December 31, 2019 are as follows: Operating Finance ($000 omitted) 2020 37,835 1,913 2021 28,926 957 2022 21,702 957 2023 15,892 80 2024 12,209 — Thereafter 14,652 — Total future minimum lease payments 131,216 3,907 Less: imputed interest (17,373 ) (191 ) Net future minimum lease payments 113,843 3,716 |
Future minimum lease payments under finance leases | Future minimum lease payments under operating and finance leases as of December 31, 2019 are as follows: Operating Finance ($000 omitted) 2020 37,835 1,913 2021 28,926 957 2022 21,702 957 2023 15,892 80 2024 12,209 — Thereafter 14,652 — Total future minimum lease payments 131,216 3,907 Less: imputed interest (17,373 ) (191 ) Net future minimum lease payments 113,843 3,716 |
Future minimum lease payments | As required by the Company's adoption of Topic 842 using the optional transition method (refer to Note 1-Q), below were the future minimum lease payments relating to operating leases as of December 31, 2018 (in thousands of dollars): 2019 40,664 2020 27,064 2021 17,663 2022 11,521 2023 6,677 2024 and after 8,923 112,512 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Summary of operating revenues | The Company's operating revenues, summarized by type, are as follows: 2019 2018 2017 ($000 omitted) Title insurance premiums: Direct 615,646 597,510 602,858 Agency 970,540 1,003,959 1,016,356 Escrow fees 137,539 124,660 142,463 Search, abstract and valuation services 82,050 92,708 96,703 Other revenues 71,678 69,045 76,205 1,877,453 1,887,882 1,934,585 |
Segment information (Tables)
Segment information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Selected statement of operations and income (loss) information related to segments | Selected statement of income information related to these segments for the years ended December 31 is as follows: 2019 2018 2017 ($000 omitted) Title segment: Revenues 1,857,048 1,855,706 1,899,462 Depreciation and amortization 19,971 21,449 21,384 Income before taxes and noncontrolling interest 108,459 108,314 103,361 Ancillary services and corporate segment: Revenues 82,960 51,966 56,262 Depreciation and amortization 2,555 3,483 4,494 Income (loss) before taxes and noncontrolling interest 8,508 (35,785 ) (28,294 ) Consolidated Stewart: Revenues 1,940,008 1,907,672 1,955,724 Depreciation and amortization 22,526 24,932 25,878 Income before taxes and noncontrolling interest 116,967 72,529 75,067 |
Revenues generated in domestic and all international operations | Revenues for the years ended December 31 in the United States and all international operations are as follows: 2019 2018 2017 ($000 omitted) United States 1,816,531 1,787,843 1,825,186 International 123,477 119,829 130,538 1,940,008 1,907,672 1,955,724 |
Other comprehensive income (l_2
Other comprehensive income (loss) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Equity [Abstract] | |
Schedule of changes in other comprehensive income (loss) | Changes in the balances of each component of other comprehensive income (loss) and the related tax effects are as follows: For the Year Ended December 31, 2019 For the Year Ended For the Year Ended Before-Tax Amount Tax Expense (Benefit) Net-of-Tax Amount Before-Tax Amount Tax Expense (Benefit) Net-of Tax Amount Before-Tax Amount Tax Expense (Benefit) Net-of-Tax Amount ($000 omitted) ($000 omitted) ($000 omitted) Foreign currency translation adjustments 8,337 1,859 6,478 (13,336 ) (2,848 ) (10,488 ) 11,050 2,696 8,354 Net unrealized gains (losses) on investments: Change in net unrealized gains and losses on investments 19,220 4,036 15,184 (11,294 ) (2,372 ) (8,922 ) 2,718 952 1,766 Reclassification adjustment for change in unrealized gains and losses included in net income 519 109 410 (1,167 ) (245 ) (922 ) (3,210 ) (1,124 ) (2,086 ) 19,739 4,145 15,594 (12,461 ) (2,617 ) (9,844 ) (492 ) (172 ) (320 ) Other comprehensive income (loss) 28,076 6,004 22,072 (25,797 ) (5,465 ) (20,332 ) 10,558 2,524 8,034 |
Quarterly financial informati_2
Quarterly financial information (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of quarterly financial information | Mar 31 June 30 Sept 30 Dec 31 Total ($000 omitted, except per share) Revenues: 2019 398,519 472,075 559,508 509,906 1,940,008 2018 437,229 492,869 507,640 469,934 1,907,672 Net (loss) income attributable to Stewart: 2019 (6,768 ) 19,306 66,108 (31 ) 78,615 2018 (3,781 ) 22,377 17,554 11,373 47,523 Diluted (loss) earnings per share attributable to Stewart (1) : 2019 (0.29 ) 0.81 2.78 — 3.31 2018 (0.16 ) 0.95 0.74 0.48 2.01 (1) Quarterly per share data may not sum to annual totals due to rounding or effects of dilution in particular quarters but not in annual totals. |
General - General (Details)
General - General (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Revenue major segments percentage | 47.00% |
General - Title Losses and Rela
General - Title Losses and Related Claims (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Reserve for Title Losses [Line Items] | |
Threshold amount for large claims | $ 1,000,000 |
Maximum | |
Reserve for Title Losses [Line Items] | |
Reserve amount, threshold percentage | 5.00% |
Minimum | |
Reserve for Title Losses [Line Items] | |
Reserve amount, threshold percentage | 4.00% |
General - Investments in Debt a
General - Investments in Debt and Equity Securities (Details) $ in Millions | Jan. 01, 2018USD ($) |
ASU 2016-01 | |
Debt Securities, Available-for-sale [Line Items] | |
Net unrealized investment gains | $ 4.6 |
General - Property and Equipmen
General - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Buildings | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life (years) | 30 years |
Buildings | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life (years) | 40 years |
Furniture and equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life (years) | 3 years |
Furniture and equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Property and equipment, useful life (years) | 5 years |
General - Impairment of Long-li
General - Impairment of Long-lived Assets (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Accounting Policies [Abstract] | |
Impairment of long-lived assets | $ 9.9 |
General - Goodwill (Details)
General - Goodwill (Details) | 12 Months Ended |
Dec. 31, 2019reporting_unit | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reporting units | 4 |
General - Other Intangibles (De
General - Other Intangibles (Details) | 12 Months Ended |
Dec. 31, 2019 | |
Minimum | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets estimated life (years) | 3 years |
Maximum | |
Finite-Lived Intangible Assets [Line Items] | |
Intangible assets estimated life (years) | 10 years |
General - Recently Adopted Acco
General - Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Jan. 01, 2019 | Dec. 31, 2018 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease assets | $ 99,028 | ||
Deferred rent liabilities | $ (126,779) | $ (109,283) | |
ASU 2016-02 | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease assets | $ 99,800 | ||
Deferred rent liabilities | $ 10,700 |
General - Merger Agreement Term
General - Merger Agreement Termination (Details) - USD ($) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2019 | |
Accounting Policies [Abstract] | ||
Gain realized from termination fee paid by FNF | $ 50 | $ 50 |
Restrictions on cash and inve_2
Restrictions on cash and investments (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Cash and Cash Equivalents [Abstract] | ||
Statutory reserve funds | $ 483,389 | $ 462,229 |
Restricted cash and cash equivalent | $ 39,700 | $ 37,700 |
Statutory surplus and dividen_2
Statutory surplus and dividend restrictions (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2020 | |
Dividends Payable [Line Items] | ||||
Maximum amount of dividend to be paid | $ 115,000,000 | |||
Dividends paid by guaranty | 0 | $ 25,000,000 | $ 20,000,000 | |
Surplus for guaranty | 617,900,000 | 574,800,000 | ||
Statutory net income | 38,300,000 | $ 74,200,000 | $ 47,700,000 | |
Statutory capital and surplus necessary to satisfy regulatory requirements for guaranty | 2,000,000 | |||
Underwriter Entities | ||||
Dividends Payable [Line Items] | ||||
Statutory capital and surplus necessary to satisfy regulatory requirements for guaranty | $ 2,000,000 | |||
Scenario, Forecast | ||||
Dividends Payable [Line Items] | ||||
Maximum amount of dividend to be paid | $ 115,000,000 |
Investments in debt and equit_3
Investments in debt and equity securities - Investments in Debt and Equity Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Investments, Debt and Equity Securities [Abstract] | ||
Debt securities | $ 605,721 | $ 602,020 |
Equity securities | 39,318 | 33,997 |
Investments in debt and equity securities | $ 645,039 | $ 636,017 |
Investments in debt and equit_4
Investments in debt and equity securities - Additional Information (Details) $ in Thousands | Dec. 31, 2019USD ($)investment | Dec. 31, 2018USD ($) |
Investments, Debt and Equity Securities [Abstract] | ||
Net unrealized investment gains on equity securities held | $ 6,900 | $ 2,900 |
Debt Securities, Available-for-sale [Line Items] | ||
Foreign debt securities | $ 605,721 | 602,020 |
Number of investments in an unrealized loss position | investment | 50 | |
Number of investments in an unrealized loss positions for more than 12 months | investment | 26 | |
Foreign | ||
Debt Securities, Available-for-sale [Line Items] | ||
Foreign debt securities | $ 236,073 | 198,938 |
Foreign | Canada | ||
Debt Securities, Available-for-sale [Line Items] | ||
Foreign debt securities | 206,500 | 171,200 |
Foreign | United Kingdom | ||
Debt Securities, Available-for-sale [Line Items] | ||
Foreign debt securities | $ 24,100 | $ 23,000 |
Investments in debt and equit_5
Investments in debt and equity securities - Amortized Costs and Fair Values (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized costs | $ 592,648 | $ 608,686 |
Fair values | 605,721 | 602,020 |
Municipal | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized costs | 52,176 | 61,779 |
Fair values | 53,823 | 61,934 |
Corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized costs | 299,074 | 333,289 |
Fair values | 309,142 | 328,495 |
Foreign | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized costs | 234,734 | 200,667 |
Fair values | 236,073 | 198,938 |
U.S. Treasury Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized costs | 6,664 | 12,951 |
Fair values | $ 6,683 | $ 12,653 |
Investments in debt and equit_6
Investments in debt and equity securities - Gross Unrealized Gains and Losses (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Securities, Available-for-sale [Line Items] | ||
Gains | $ 14,162 | $ 3,780 |
Losses | 1,089 | 10,446 |
Municipal | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gains | 1,649 | 482 |
Losses | 2 | 327 |
Corporate | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gains | 10,091 | 1,894 |
Losses | 23 | 6,688 |
Foreign | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gains | 2,362 | 1,402 |
Losses | 1,023 | 3,131 |
U.S. Treasury Bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Gains | 60 | 2 |
Losses | $ 41 | $ 300 |
Investments in debt and equit_7
Investments in debt and equity securities - Debt Securities According Contractual Terms (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Amortized costs | ||
In one year or less | $ 68,377 | |
After one year through five years | 336,402 | |
After five years through ten years | 157,147 | |
After ten years | 30,722 | |
Amortized costs | 592,648 | $ 608,686 |
Fair values | ||
In one year or less | 68,517 | |
After one year through five years | 341,773 | |
After five years through ten years | 162,778 | |
After ten years | 32,653 | |
Fair values | $ 605,721 | $ 602,020 |
Investments in debt and equit_8
Investments in debt and equity securities - Gross Unrealized Losses on Investments and Fair Values of Related Securities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Losses | ||
Less than 12 months | $ 343 | $ 4,665 |
More than 12 months | 746 | 5,781 |
Total | 1,089 | 10,446 |
Fair values | ||
Less than 12 months | 99,581 | 226,755 |
More than 12 months | 58,090 | 233,026 |
Total | 157,671 | 459,781 |
Municipal | ||
Losses | ||
Less than 12 months | 2 | 91 |
More than 12 months | 0 | 236 |
Total | 2 | 327 |
Fair values | ||
Less than 12 months | 53 | 13,366 |
More than 12 months | 0 | 11,645 |
Total | 53 | 25,011 |
Corporate | ||
Losses | ||
Less than 12 months | 23 | 4,416 |
More than 12 months | 0 | 2,272 |
Total | 23 | 6,688 |
Fair values | ||
Less than 12 months | 7,420 | 201,965 |
More than 12 months | 0 | 71,044 |
Total | 7,420 | 273,009 |
Foreign | ||
Losses | ||
Less than 12 months | 318 | 158 |
More than 12 months | 705 | 2,973 |
Total | 1,023 | 3,131 |
Fair values | ||
Less than 12 months | 92,108 | 11,424 |
More than 12 months | 55,875 | 137,793 |
Total | 147,983 | 149,217 |
U.S. Treasury Bonds | ||
Losses | ||
Less than 12 months | 0 | 0 |
More than 12 months | 41 | 300 |
Total | 41 | 300 |
Fair values | ||
Less than 12 months | 0 | 0 |
More than 12 months | 2,215 | 12,544 |
Total | $ 2,215 | $ 12,544 |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | $ 605,721 | $ 602,020 |
Equity securities | 39,318 | 33,997 |
Investments in debt and equity securities | 645,039 | 636,017 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 39,318 | 33,997 |
Investments in debt and equity securities | 39,318 | 33,997 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 0 | 0 |
Investments in debt and equity securities | 605,721 | 602,020 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities | 0 | 0 |
Investments in debt and equity securities | 0 | 0 |
Municipal | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 53,823 | 61,934 |
Municipal | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Municipal | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 53,823 | 61,934 |
Municipal | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Corporate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 309,142 | 328,495 |
Corporate | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Corporate | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 309,142 | 328,495 |
Corporate | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Foreign | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 236,073 | 198,938 |
Foreign | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
Foreign | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 236,073 | 198,938 |
Foreign | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
U.S. Treasury Bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 6,683 | 12,653 |
U.S. Treasury Bonds | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 0 | 0 |
U.S. Treasury Bonds | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | 6,683 | 12,653 |
U.S. Treasury Bonds | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Debt securities | $ 0 | $ 0 |
Investment income and net rea_3
Investment income and net realized and unrealized gains - Income from Investments and Net Realized and Unrealized Gains (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | $ 19,795 | $ 19,737 | $ 18,932 |
Net realized and unrealized gains: | |||
Realized gains | 53,465 | 2,698 | 4,997 |
Realized losses | (14,747) | (483) | (2,790) |
Net unrealized investment gains (losses) recognized on equity securities still held | 4,042 | (2,162) | 0 |
Investment and other gains (losses) – net | 42,760 | 53 | 2,207 |
Debt securities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | 15,769 | 17,431 | 17,222 |
Short-term investments, cash equivalents and other | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investment income | $ 4,026 | $ 2,306 | $ 1,710 |
Investment income and net rea_4
Investment income and net realized and unrealized gains - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Gain realized from termination fee paid by FNF | $ 50,000 | $ 50,000 | ||
Net unrealized gain of equity investment | 4,000 | |||
Realized gain of equity investment | 2,500 | |||
Impairment expenses | 14,700 | |||
Realized gains from sales of equity investments with no previously readily determinable fair value | $ 1,300 | |||
Net unrealized investment losses recognized on equity securities still held | $ (4,042) | $ 2,162 | $ 0 | |
Net realized gains from sale of securities investments | 3,200 | |||
Net realized losses from change in fair value of contingent consideration liabilities | $ 800 |
Investment income and net rea_5
Investment income and net realized and unrealized gains - Net Gains (Losses) on Investments in Equity Securities Still Held (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |||
Total net investment gains (losses) recognized on equity securities during the period | $ 4,825 | $ (2,538) | |
Less: Net realized gains (losses) on equity securities sold during the period | 783 | (376) | |
Net unrealized investment gains (losses) recognized on equity securities still held | $ 4,042 | $ (2,162) | $ 0 |
Investment income and net rea_6
Investment income and net realized and unrealized gains - Proceeds from Sale of Investment (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Debt Securities, Available-for-sale [Line Items] | |||
Total proceeds from sales of investments in securities | $ 50,605 | $ 49,442 | |
Total proceeds from sales of investments in securities | $ 76,942 | ||
Debt securities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Total proceeds from sales of investments in securities | 46,834 | 43,556 | |
Total proceeds from sales of investments in securities | 68,649 | ||
Equity securities | |||
Debt Securities, Available-for-sale [Line Items] | |||
Total proceeds from sales of investments in securities | $ 3,771 | $ 5,886 | |
Total proceeds from sales of investments in securities | $ 8,293 |
Income taxes - Additional Infor
Income taxes - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Tax Credit Carryforward [Line Items] | |||
Total income tax benefit resulting from the 2017 Act | $ 7,800 | ||
Transition tax expense (benefit) on deemed repatriation of deferred foreign income | $ 0 | $ (624) | 1,213 |
Federal and state income tax benefits related to the remeasurement of deferred tax assets and liabilities | 800 | ||
Net deferred tax liabilities | 24,312 | 9,639 | |
Deferred tax assets relating to NOL carryforwards | 7,017 | 6,936 | |
U.S. Federal | |||
Tax Credit Carryforward [Line Items] | |||
Total income tax benefit resulting from the 2017 Act | 7,200 | ||
State | |||
Tax Credit Carryforward [Line Items] | |||
Total income tax benefit resulting from the 2017 Act | 100 | $ 600 | |
Foreign | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards | $ 2,200 | ||
Retained Earnings | |||
Tax Credit Carryforward [Line Items] | |||
Reclassification of net tax expense from AOCI to retained earning | $ 1,000 |
Income taxes - Income Tax Expen
Income taxes - Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current income tax expense: | |||
Federal | $ 12,329 | $ 5,540 | $ 1,154 |
State | 846 | 1,089 | 814 |
Foreign | 4,851 | 6,622 | 4,625 |
Current income tax expense: | 18,026 | 13,251 | 6,593 |
Deferred income tax expense (benefit): | |||
Federal | 6,631 | 43 | 4,088 |
State | 150 | (864) | (254) |
Foreign | 1,888 | 1,077 | 4,494 |
Deferred income tax expense (benefit): | 8,669 | 256 | 8,328 |
Total income tax expense | $ 26,695 | $ 13,507 | $ 14,921 |
Income taxes - Reconciliation o
Income taxes - Reconciliation of Income Tax Expenses Computed at Federal Statutory Rate with Income Tax Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
Expected income tax expense at 21% in 2019 and 2018 and 35% in 2017 | $ 22,116 | $ 12,816 | $ 22,253 |
Nondeductible expenses | 3,249 | 1,872 | 2,610 |
Valuation allowance | 1,326 | 1,741 | 0 |
Net expense (benefit) for the Canadian branch | 613 | 128 | (1,480) |
Return-to-provision and true-up adjustments | (776) | (370) | 923 |
Research and development credits | (278) | (732) | (2,158) |
2017 Act impact from the U.S. corporate tax rate change | 0 | (745) | (7,196) |
2017 Act impact from deemed repatriation of deferred foreign income | 0 | (624) | 1,213 |
Other – net | 445 | (579) | (1,244) |
Total income tax expense | $ 26,695 | $ 13,507 | $ 14,921 |
Effective income tax rate | 25.30% | 22.10% | 23.50% |
Income taxes - Reconciliation_2
Income taxes - Reconciliation of Income Tax Expenses Computed at Federal Statutory Rate with Income Tax Expense (Additional Information) (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Contingency [Line Items] | ||
Total income tax benefit resulting from the 2017 Act | $ 7.8 | |
State | ||
Income Tax Contingency [Line Items] | ||
Total income tax benefit resulting from the 2017 Act | $ 0.1 | $ 0.6 |
Income taxes - Deferred Tax Ass
Income taxes - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Deferred tax assets: | ||
Accrued expenses | $ 18,290 | $ 16,013 |
Federal offset to Canadian deferred tax liability | 7,961 | 6,618 |
Net operating loss (NOL) carryforwards | 7,017 | 6,936 |
Tax credit carryforwards | 2,230 | 1,477 |
Foreign currency translation adjustments | 1,765 | 3,194 |
Allowance for uncollectible amounts | 983 | 1,023 |
Net unrealized losses on investments in securities | 621 | 1,205 |
Investments | 424 | 857 |
Capitalized expenses | 0 | 2,356 |
Other | 1,370 | 1,235 |
Deferred tax assets – gross | 40,661 | 40,914 |
Valuation allowance | (4,056) | (3,824) |
Deferred tax assets – net | 36,605 | 37,090 |
Deferred tax liabilities: | ||
Title loss provisions | (29,704) | (21,936) |
Amortization – goodwill and other intangibles | (22,379) | (19,891) |
Net unrealized gains on investments in securities | (4,218) | 0 |
Deferred compensation on life insurance policies | (2,202) | (2,029) |
Fixed assets | (1,997) | (1,917) |
Other | (417) | (956) |
Deferred tax liabilities – gross | (60,917) | (46,729) |
Net deferred income tax liability | $ (24,312) | $ (9,639) |
Goodwill and other intangible_2
Goodwill and other intangibles - Summary of Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018 | Dec. 31, 2019 | |
Goodwill summary | ||
Beginning balances | $ 231,428 | |
Acquisitions | 17,504 | |
Disposals | (42) | |
Ending balances | 248,890 | |
Goodwill | 248,890 | $ 248,890 |
Title | ||
Goodwill summary | ||
Beginning balances | 225,699 | |
Acquisitions | 17,504 | |
Disposals | (42) | |
Ending balances | 243,161 | |
Goodwill | 243,161 | 243,161 |
Ancillary Services and Corporate | ||
Goodwill summary | ||
Beginning balances | 5,729 | |
Acquisitions | 0 | |
Disposals | 0 | |
Ending balances | 5,729 | |
Goodwill | $ 5,729 | $ 5,729 |
Goodwill and other intangible_3
Goodwill and other intangibles - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Increase in goodwill | $ 17,504 | |
Other intangibles, gross carrying amount | $ 35,000 | 35,000 |
Accumulated amortization of other intangibles | 30,400 | 25,300 |
Amortization expense of other intangibles | 4,200 | 4,600 |
Impairment expense of other intangible assets | 900 | |
Future amortization expense | ||
Expected amortization expense in 2020 | 2,300 | |
Expected amortization expense in 2021 | 900 | |
Expected amortization expense in 2022 | 400 | |
Expected amortization expense in 2023 | 200 | |
Expected amortization expense in 2024 | $ 200 | |
Employment and Non-compete Agreements | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Other intangibles acquired | $ 4,500 | |
Employment and Non-compete Agreements | Minimum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 1 year | |
Employment and Non-compete Agreements | Maximum | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Amortization period | 3 years | |
Title | ||
Acquired Finite-Lived Intangible Assets [Line Items] | ||
Increase in goodwill | $ 17,504 |
Equity investees - Summarized A
Equity investees - Summarized Aggregate Financial Information for Equity Investees (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |||
Revenues | $ 19,660 | $ 22,286 | $ 25,351 |
Net income | 6,231 | 4,729 | 4,997 |
Total assets | 36,865 | 33,268 | 32,171 |
Notes payable | 27,841 | 24,833 | 20,902 |
Stockholders’ equity | $ 6,341 | $ 6,292 | $ 9,023 |
Equity investees - Additional I
Equity investees - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Subsidiary, Sale of Stock [Line Items] | |||
Net premium revenues from policies issued by equity investees | $ 19,660,000 | $ 22,286,000 | $ 25,351,000 |
Earnings related to equity investees | 6,231,000 | 4,729,000 | 4,997,000 |
Goodwill related to equity investees | 4,600,000 | 7,300,000 | |
Impairment on disposal of equity investment | 2,700,000 | 0 | 0 |
Direct Operations | |||
Subsidiary, Sale of Stock [Line Items] | |||
Net premium revenues from policies issued by equity investees | 700,000 | 2,100,000 | 2,100,000 |
Earnings related to equity investees | $ 3,000,000 | $ 1,900,000 | $ 2,200,000 |
Notes payable - Summary of Note
Notes payable - Summary of Notes Payable (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||
Line of credit facility | $ 98,875 | $ 98,875 |
Other notes payable | 11,757 | 9,161 |
Notes payable | $ 110,632 | $ 108,036 |
Average interest rate | 3.55% | 3.58% |
Notes payable - Additional Info
Notes payable - Additional Information (Details) - USD ($) | 1 Months Ended | |||
Nov. 30, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Oct. 31, 2018 | |
Debt Disclosure [Abstract] | ||||
Principal payments on notes in 2020 | $ 9,800,000 | |||
Principal payments on notes in 2021 | 900,000 | |||
Principal payments on notes in 2022 | 900,000 | |||
Principal payments on notes in 2023 | 99,000,000 | |||
Debt Instrument [Line Items] | ||||
Capital lease obligation | 3,716,000 | |||
Capital lease obligations | $ 6,500,000 | |||
Bank line of credit facility, outstanding | 98,875,000 | 98,875,000 | ||
Notes Payable, Other Than Banks | ||||
Debt Instrument [Line Items] | ||||
Outstanding balances of short-term loan agreements | 8,000,000 | $ 2,600,000 | ||
Minimum | ||||
Debt Instrument [Line Items] | ||||
Commitment fee (as a percent) | 0.20% | |||
Maximum | ||||
Debt Instrument [Line Items] | ||||
Commitment fee (as a percent) | 0.35% | |||
Line of Credit | ||||
Debt Instrument [Line Items] | ||||
Bank line of credit facility amount | $ 150,000,000 | $ 125,000,000 | ||
Line of credit, conditional increase in maximum borrowing capacity | $ 50,000,000 | |||
Fixed charge ratio, minimum | 1.15 | |||
Leverage ratio, maximum | 3.50 | |||
Aggregate annual capital expenditures allowed | $ 30,000,000 | |||
Annual dividend payments allowed | $ 40,000,000 | |||
Bank line of credit facility, outstanding | 98,900,000 | |||
Remaining borrowing capacity | 48,600,000 | |||
Line of Credit | Base Rate | Minimum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate, line of credit (percent) | 0.375% | |||
Line of Credit | Base Rate | Maximum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate, line of credit (percent) | 0.50% | |||
Line of Credit | LIBOR | Minimum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate, line of credit (percent) | 1.375% | |||
Line of Credit | LIBOR | Maximum | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate, line of credit (percent) | 1.75% | |||
Line of Credit | Letter of Credit | ||||
Debt Instrument [Line Items] | ||||
Remaining borrowing capacity | $ 2,500,000 |
Estimated title losses - Estima
Estimated title losses - Estimated Title Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Loss Contingency Accrual | |||
Balances at beginning of period | $ 461,560 | $ 480,990 | $ 462,572 |
Provisions: | |||
Current year | 79,141 | 70,480 | 90,401 |
Previous policy years | 5,282 | 1,034 | 6,131 |
Total provisions | 84,423 | 71,514 | 96,532 |
Payments, net of recoveries: | |||
Current year | (19,052) | (17,460) | (20,335) |
Previous policy years | (71,956) | (65,246) | (63,914) |
Total payments, net of recoveries | (91,008) | (82,706) | (84,249) |
Effects of changes in foreign currency exchange rates | 4,078 | (8,238) | 6,135 |
Balances at end of period | $ 459,053 | $ 461,560 | $ 480,990 |
Loss ratios as a percentage of title operating revenues: | |||
Current year provisions | 4.30% | 3.80% | 4.80% |
Total provisions | 4.60% | 3.90% | 5.10% |
Estimated title losses - Additi
Estimated title losses - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Gain (Loss) on Securities [Line Items] | |||
Reduction in prior policy year reserve | $ 4,000 | ||
Net increase in loss reserve estimates for prior policy years | $ 5,282 | 1,034 | $ 6,131 |
Large Title Claims | |||
Gain (Loss) on Securities [Line Items] | |||
Total provisions related to prior policy years | $ 6,000 | $ 4,400 | $ 4,300 |
Share-based payments - Addition
Share-based payments - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Fair value of vested shares | $ 2.1 | $ 4.2 | |
Compensation costs | $ 2.1 | $ 4.8 | $ 5.3 |
Director | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 1 year | ||
Shares granted in relation to the annual director retainer compensation (in shares) | 13,700 | 14,300 | 13,000 |
Fair value of vested shares | $ 0.6 | $ 0.6 | $ 0.6 |
Time-Based Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Performance-Based Shares | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Award vesting period | 3 years | ||
Restricted Stock and Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Aggregate fair values at grant date | $ 5.1 | $ 4.8 | $ 5.7 |
Share-based incentives, shares issued | 122,400 | 110,600 | 133,000 |
Average grant price (in usd per share) | $ 42.02 | $ 43.39 | $ 42.59 |
Restricted Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Share-based incentives, shares issued | 13,702 | ||
Average grant price (in usd per share) | $ 41.26 | ||
Shares granted in relation to the annual director retainer compensation (in shares) | 33,532 | ||
Tax benefits related to vesting of awards | $ 0.5 | $ 1.1 | $ 1.2 |
Compensation costs not yet recognized | $ 4.1 | ||
Compensation costs not yet recognized, period for recognition | 1 year 8 months 12 days |
Share-based payments - Summary
Share-based payments - Summary of the Restricted Common Stock Award/Unit Activity (Details) | 12 Months Ended |
Dec. 31, 2019$ / sharesshares | |
Restricted Stock Awards | |
Shares | |
Nonvested balance at beginning of period (in shares) | shares | 120,276 |
Granted (in shares) | shares | 13,702 |
Adjustment for performance-based shares (in shares) | shares | (40,297) |
Vested (in shares) | shares | (33,532) |
Forfeited (in shares) | shares | (6,760) |
Nonvested balance at end of period (in shares) | shares | 53,389 |
Weighted-Average Grant-Date Fair Value per Share ($) | |
Nonvested balance at beginning of period (in usd per share) | $ / shares | $ 40.99 |
Granted (in usd per share) | $ / shares | 41.26 |
Adjustment for performance-based shares (in usd per share) | $ / shares | 42.32 |
Vested (in usd per share) | $ / shares | 39.82 |
Forfeited (in usd per share) | $ / shares | 42.50 |
Nonvested balance at end of period (in usd per share) | $ / shares | $ 40.60 |
Restricted Stock Unit | |
Shares | |
Nonvested balance at beginning of period (in shares) | shares | 123,841 |
Granted (in shares) | shares | 122,358 |
Vested (in shares) | shares | (17,003) |
Forfeited (in shares) | shares | (33,179) |
Nonvested balance at end of period (in shares) | shares | 196,017 |
Weighted-Average Grant-Date Fair Value per Share ($) | |
Nonvested balance at beginning of period (in usd per share) | $ / shares | $ 42.67 |
Granted (in usd per share) | $ / shares | 42.02 |
Vested (in usd per share) | $ / shares | 42.14 |
Forfeited (in usd per share) | $ / shares | 43.21 |
Nonvested balance at end of period (in usd per share) | $ / shares | $ 42.21 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Numerator: | |||||||||||
Net income attributable to Stewart | $ (31) | $ 66,108 | $ 19,306 | $ (6,768) | $ 11,373 | $ 17,554 | $ 22,377 | $ (3,781) | $ 78,615 | $ 47,523 | $ 48,659 |
Denominator (000): | |||||||||||
Basic average shares outstanding (in shares) | 23,611 | 23,543 | 23,445 | ||||||||
Average number of dilutive shares relating to restricted shares and units (in shares) | 142 | 142 | 152 | ||||||||
Diluted average shares outstanding (in shares) | 23,753 | 23,685 | 23,597 | ||||||||
Basic earnings per share attributable to Stewart (in usd per share) | $ 3.33 | $ 2.02 | $ 2.08 | ||||||||
Diluted earnings per share attributable to Stewart (in usd per share) | $ 0 | $ 2.78 | $ 0.81 | $ (0.29) | $ 0.48 | $ 0.74 | $ 0.95 | $ (0.16) | $ 3.31 | $ 2.01 | $ 2.06 |
Reinsurance (Details)
Reinsurance (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Insurance [Abstract] | |||
Total amount of premiums for assumed and ceded risks as a percentage of consolidated title revenue (less than) | 1.00% | 1.00% | 1.00% |
Reinsurance recoverables | $ 0 | $ 0 | |
Reinsurance payable | $ 0 | $ 0 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Leases [Abstract] | |||
Operating lease expense | $ 42.5 | ||
Operating lease expense | $ 40.8 | $ 40.8 | |
Short-term lease expense | 4.2 | ||
Total finance lease expense | $ 2.4 | $ 3.8 | $ 3.1 |
Leases - Classification of Leas
Leases - Classification of Leases (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Assets: | |
Operating lease assets, net of accumulated amortization | $ 99,028 |
Finance lease assets, net of accumulated depreciation | 4,312 |
Total lease assets | 103,340 |
Liabilities: | |
Operating lease liabilities | 113,843 |
Finance lease liabilities | 3,716 |
Total lease liabilities | $ 117,559 |
Leases - Other Information Rela
Leases - Other Information Related to Leases (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Operating | |
Cash paid for amounts included in the measurement of lease liabilities ($000) | $ 43,207 |
Lease assets obtained in exchange for lease obligations ($000) | $ 51,188 |
Weighted average remaining lease term (years): | 4 years 8 months 12 days |
Weighted average discount rate | 4.40% |
Finance | |
Cash paid for amounts included in the measurement of lease liabilities ($000) | $ 3,076 |
Lease assets obtained in exchange for lease obligations ($000) | $ 0 |
Weighted average remaining lease term (years): | 2 years 6 months |
Weighted average discount rate | 4.70% |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating | |
2020 | $ 37,835 |
2021 | 28,926 |
2022 | 21,702 |
2023 | 15,892 |
2024 | 12,209 |
Thereafter | 14,652 |
Total future minimum lease payments | 131,216 |
Less: imputed interest | (17,373) |
Net future minimum lease payments | 113,843 |
Finance | |
2020 | 1,913 |
2021 | 957 |
2022 | 957 |
2023 | 80 |
2024 | 0 |
Thereafter | 0 |
Total future minimum lease payments | 3,907 |
Less: imputed interest | (191) |
Net future minimum lease payments | $ 3,716 |
Leases - Summary of Future Mini
Leases - Summary of Future Minimum Lease Payments of Operating Leases (Details) $ in Thousands | Dec. 31, 2018USD ($) |
Leases [Abstract] | |
2019 | $ 40,664 |
2020 | 27,064 |
2021 | 17,663 |
2022 | 11,521 |
2023 | 6,677 |
2024 and after | 8,923 |
Future minimum payments, total | $ 112,512 |
Contingent liabilities and co_2
Contingent liabilities and commitments (Details) $ in Millions | Dec. 31, 2019USD ($) |
Loss Contingencies [Line Items] | |
Guarantee of indebtedness, relating to unused letters of credit | $ 5.4 |
Escrow Account Deposit | |
Loss Contingencies [Line Items] | |
Contingent liability, escrow deposit | 1,300 |
Escrow Account Deposit - Section 1031 Exchange | |
Loss Contingencies [Line Items] | |
Contingent liability, escrow deposit | $ 1,100 |
Revenues (Details)
Revenues (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Disaggregation of Revenue [Line Items] | |||
Operating revenues | $ 1,877,453 | $ 1,887,882 | $ 1,934,585 |
Title insurance premiums, Direct | |||
Disaggregation of Revenue [Line Items] | |||
Operating revenues | 615,646 | 597,510 | 602,858 |
Title insurance premiums, Agency | |||
Disaggregation of Revenue [Line Items] | |||
Operating revenues | 970,540 | 1,003,959 | 1,016,356 |
Escrow fees | |||
Disaggregation of Revenue [Line Items] | |||
Operating revenues | 137,539 | 124,660 | 142,463 |
Search, abstract and valuation services | |||
Disaggregation of Revenue [Line Items] | |||
Operating revenues | 82,050 | 92,708 | 96,703 |
Other revenues | |||
Disaggregation of Revenue [Line Items] | |||
Operating revenues | $ 71,678 | $ 69,045 | $ 76,205 |
Segment information - Additiona
Segment information - Additional Information (Details) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)segment | |
Segment Reporting [Abstract] | ||
Number of operating segments | segment | 2 | |
Gain realized from termination fee paid by FNF | $ | $ 50 | $ 50 |
Segment information - Selected
Segment information - Selected Statement of Operations and Income (Loss) Information Related to Segments (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 509,906 | $ 559,508 | $ 472,075 | $ 398,519 | $ 469,934 | $ 507,640 | $ 492,869 | $ 437,229 | $ 1,940,008 | $ 1,907,672 | $ 1,955,724 |
Depreciation and amortization | 22,526 | 24,932 | 25,878 | ||||||||
Income (loss) before taxes and noncontrolling interest | 116,967 | 72,529 | 75,067 | ||||||||
Title segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 1,857,048 | 1,855,706 | 1,899,462 | ||||||||
Depreciation and amortization | 19,971 | 21,449 | 21,384 | ||||||||
Income (loss) before taxes and noncontrolling interest | 108,459 | 108,314 | 103,361 | ||||||||
Ancillary services and corporate segment | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 82,960 | 51,966 | 56,262 | ||||||||
Depreciation and amortization | 2,555 | 3,483 | 4,494 | ||||||||
Income (loss) before taxes and noncontrolling interest | $ 8,508 | $ (35,785) | $ (28,294) |
Segment information - Revenues
Segment information - Revenues Generated in Domestic and Foreign Country (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | $ 509,906 | $ 559,508 | $ 472,075 | $ 398,519 | $ 469,934 | $ 507,640 | $ 492,869 | $ 437,229 | $ 1,940,008 | $ 1,907,672 | $ 1,955,724 |
United States | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | 1,816,531 | 1,787,843 | 1,825,186 | ||||||||
International | |||||||||||
Revenues from External Customers and Long-Lived Assets [Line Items] | |||||||||||
Net revenue | $ 123,477 | $ 119,829 | $ 130,538 |
Other comprehensive income (l_3
Other comprehensive income (loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Before-Tax Amount | |||
Other comprehensive income (loss) | $ 28,076 | $ (25,797) | $ 10,558 |
Tax Expense (Benefit) | |||
Other comprehensive income (loss) | 6,004 | (5,465) | 2,524 |
Net-of-Tax Amount | |||
Other comprehensive income (loss) | 22,072 | (20,332) | 8,034 |
Foreign currency translation adjustments | |||
Before-Tax Amount | |||
Other comprehensive income (loss) | 8,337 | (13,336) | 11,050 |
Tax Expense (Benefit) | |||
Other comprehensive income (loss) | 1,859 | (2,848) | 2,696 |
Net-of-Tax Amount | |||
Other comprehensive income (loss) | 6,478 | (10,488) | 8,354 |
Net unrealized gains on investments | |||
Before-Tax Amount | |||
Change in net unrealized gains and losses on investments | 19,220 | (11,294) | 2,718 |
Reclassification adjustment for change in unrealized gains and losses included in net income | 519 | (1,167) | (3,210) |
Other comprehensive income (loss) | 19,739 | (12,461) | (492) |
Tax Expense (Benefit) | |||
Change in net unrealized gains and losses on investments | 4,036 | (2,372) | 952 |
Reclassification adjustment for change in unrealized gains and losses included in net income | 109 | (245) | (1,124) |
Other comprehensive income (loss) | 4,145 | (2,617) | (172) |
Net-of-Tax Amount | |||
Change in net unrealized gains and losses on investments | 15,184 | (8,922) | 1,766 |
Reclassification adjustment for change in unrealized gains and losses included in net income | 410 | (922) | (2,086) |
Other comprehensive income (loss) | $ 15,594 | $ (9,844) | $ (320) |
Quarterly financial informati_3
Quarterly financial information (unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Revenues | $ 509,906 | $ 559,508 | $ 472,075 | $ 398,519 | $ 469,934 | $ 507,640 | $ 492,869 | $ 437,229 | $ 1,940,008 | $ 1,907,672 | $ 1,955,724 |
Net (loss) income attributable to Stewart | $ (31) | $ 66,108 | $ 19,306 | $ (6,768) | $ 11,373 | $ 17,554 | $ 22,377 | $ (3,781) | $ 78,615 | $ 47,523 | $ 48,659 |
Diluted (loss) earnings per share attributable to Stewart (in usd per share) | $ 0 | $ 2.78 | $ 0.81 | $ (0.29) | $ 0.48 | $ 0.74 | $ 0.95 | $ (0.16) | $ 3.31 | $ 2.01 | $ 2.06 |
Schedule I - Financial Inform_2
Schedule I - Financial Information of the Registrant (Parent Company) - Statements of Income and Retained Earnings (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2019 | Jan. 01, 2018 | Jan. 01, 2017 | |
Revenues | |||||||||||||||
Merger termination fee | $ 50,000 | $ 50,000 | |||||||||||||
Investment income | 19,795 | $ 19,737 | $ 18,932 | ||||||||||||
Revenues | $ 509,906 | $ 559,508 | $ 472,075 | $ 398,519 | $ 469,934 | $ 507,640 | $ 492,869 | $ 437,229 | 1,940,008 | 1,907,672 | 1,955,724 | ||||
Expenses | |||||||||||||||
Interest | 4,341 | 3,875 | 3,458 | ||||||||||||
Other operating expenses, including $276 each year to affiliates | 345,349 | 345,307 | 351,511 | ||||||||||||
Total expenses | 1,823,041 | 1,835,143 | 1,880,657 | ||||||||||||
Income before taxes and income from subsidiaries | 116,967 | 72,529 | 75,067 | ||||||||||||
Income tax (expense) benefit | (26,695) | (13,507) | (14,921) | ||||||||||||
Net income attributable to Stewart | (31) | $ 66,108 | $ 19,306 | (6,768) | 11,373 | $ 17,554 | $ 22,377 | (3,781) | 78,615 | 47,523 | 48,659 | ||||
Retained Earnings [Roll Forward] | |||||||||||||||
Retained earnings at beginning of year | 514,248 | 514,248 | 514,248 | ||||||||||||
Cumulative effect adjustments on adoption of new accounting pronouncements | $ 0 | ||||||||||||||
Retained earnings at end of year | 564,392 | 514,248 | 564,392 | 514,248 | |||||||||||
Parent Company | |||||||||||||||
Revenues | |||||||||||||||
Merger termination fee | 50,000 | 0 | 0 | ||||||||||||
Investment income | 0 | 25,000 | 20,000 | ||||||||||||
Other income | 753 | 665 | 784 | ||||||||||||
Revenues | 50,753 | 25,665 | 20,784 | ||||||||||||
Expenses | |||||||||||||||
Interest | 4,106 | 3,511 | 3,123 | ||||||||||||
Other operating expenses, including $276 each year to affiliates | 12,787 | 15,174 | 5,840 | ||||||||||||
Total expenses | 16,893 | 18,685 | 8,963 | ||||||||||||
Income before taxes and income from subsidiaries | 33,860 | 6,980 | 11,821 | ||||||||||||
Income tax (expense) benefit | (15) | (126) | 776 | ||||||||||||
Income from subsidiaries | 44,770 | 40,669 | 36,062 | ||||||||||||
Net income attributable to Stewart | 78,615 | 47,523 | 48,659 | ||||||||||||
Retained Earnings [Roll Forward] | |||||||||||||||
Retained earnings at beginning of year | $ 514,248 | $ 491,698 | $ 514,248 | 514,248 | 491,698 | 471,788 | |||||||||
Cash dividends on Common Stock | (28,471) | (28,565) | (28,749) | ||||||||||||
Cumulative effect adjustments on adoption of new accounting pronouncements | $ 0 | $ 3,592 | $ 0 | ||||||||||||
Retained earnings at end of year | $ 564,392 | $ 514,248 | $ 564,392 | $ 514,248 | $ 491,698 |
Schedule I - Financial Inform_3
Schedule I - Financial Information of the Registrant (Parent Company) - Statements of Income and Retained Earnings, Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Schedule of Condensed Consolidating Statement of Operations [Line Items] | |||
Other operating expenses | $ 345,349 | $ 345,307 | $ 351,511 |
Affiliates | |||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | |||
Other operating expenses | $ 276 | $ 276 | $ 276 |
Schedule I - Financial Inform_4
Schedule I - Financial Information of the Registrant (Parent Company) - Balance Sheets (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Assets | ||||
Cash and cash equivalents | $ 330,609 | $ 192,067 | ||
Receivables: | ||||
Notes - due from subsidiaries | 2,464 | 2,987 | ||
Total receivables | 72,003 | 71,462 | ||
Property and equipment, at cost: | ||||
Furniture and equipment | 178,416 | 216,498 | ||
Accumulated depreciation | (151,483) | (182,663) | ||
Total property and equipment, at cost | 50,461 | 60,794 | ||
Investments in subsidiaries, on an equity-method basis | 6,169 | 8,590 | ||
Operating lease assets | 99,028 | |||
Goodwill | 248,890 | 248,890 | $ 231,428 | |
Other assets | 35,402 | 43,121 | ||
Total assets | 1,592,785 | 1,372,930 | ||
Liabilities | ||||
Accounts payable and other liabilities | 126,779 | 109,283 | ||
Operating lease liabilities | 113,843 | |||
Notes payable | 110,632 | 108,036 | ||
Total liabilities | 839,026 | 693,093 | ||
Contingent liabilities and commitments | ||||
Stockholders’ equity | ||||
Common Stock – $1 par, authorized 51,500,000; issued 24,061,568 and 24,071,508; outstanding 23,709,407 and 23,719,347, respectively | 24,062 | 24,072 | ||
Additional paid-in capital | 164,217 | 162,642 | ||
Retained earnings | 564,392 | 514,248 | ||
Accumulated other comprehensive (loss) income (AOCI): | ||||
Foreign currency translation adjustments | (13,027) | (19,505) | ||
Net unrealized investment gains (losses) | 10,328 | (5,266) | ||
Treasury stock – 352,161 common shares, at cost | (2,666) | (2,666) | ||
Total stockholders’ equity | 747,306 | 673,525 | ||
Total liabilities and stockholders' equity | 1,592,785 | 1,372,930 | ||
Parent Company | ||||
Assets | ||||
Cash and cash equivalents | 36,849 | 24,823 | ||
Receivables: | ||||
Notes - due from subsidiaries | 5,193 | 6,609 | ||
Receivables from affiliates | 260 | 7 | ||
Total receivables | 5,453 | 6,616 | ||
Property and equipment, at cost: | ||||
Furniture and equipment | 88 | 2,662 | ||
Accumulated depreciation | (83) | (2,449) | ||
Total property and equipment, at cost | 5 | 213 | ||
Investments in subsidiaries, on an equity-method basis | 802,994 | 737,273 | ||
Operating lease assets | 8,931 | |||
Goodwill | 8,470 | 8,470 | ||
Other assets | 15,810 | 17,469 | ||
Total assets | 878,512 | 794,864 | ||
Liabilities | ||||
Accounts payable and other liabilities | 21,417 | 22,464 | ||
Operating lease liabilities | 10,914 | 0 | ||
Notes payable | 98,875 | 98,875 | ||
Total liabilities | 131,206 | 121,339 | ||
Contingent liabilities and commitments | 0 | 0 | ||
Stockholders’ equity | ||||
Common Stock – $1 par, authorized 51,500,000; issued 24,061,568 and 24,071,508; outstanding 23,709,407 and 23,719,347, respectively | 24,062 | 24,072 | ||
Additional paid-in capital | 164,217 | 162,642 | ||
Retained earnings | 564,392 | 514,248 | $ 491,698 | $ 471,788 |
Accumulated other comprehensive (loss) income (AOCI): | ||||
Foreign currency translation adjustments | (13,027) | (19,505) | ||
Net unrealized investment gains (losses) | 10,328 | (5,266) | ||
Treasury stock – 352,161 common shares, at cost | (2,666) | (2,666) | ||
Total stockholders’ equity | 747,306 | 673,525 | ||
Total liabilities and stockholders' equity | $ 878,512 | $ 794,864 |
Schedule I - Financial Inform_5
Schedule I - Financial Information of the Registrant (Parent Company) - Balance Sheets (Additional Information) (Details) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common stock, par value (in usd per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 51,500,000 | 51,500,000 |
Common stock, shares issued (in shares) | 24,061,568 | 24,071,508 |
Common stock, shares outstanding (in shares) | 23,709,407 | 23,719,347 |
Treasury stock, common shares (in shares) | 352,161 | 352,161 |
Parent Company | ||
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Common stock, par value (in usd per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 51,500,000 | 51,500,000 |
Common stock, shares issued (in shares) | 24,061,568 | 24,071,508 |
Common stock, shares outstanding (in shares) | 23,709,407 | 23,719,347 |
Treasury stock, common shares (in shares) | 352,161 | 352,161 |
Schedule I - Financial Inform_6
Schedule I - Financial Information of the Registrant (Parent Company) - Statements of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of net income to cash provided (used) by operating activities: | |||||||||||
Net income attributable to Stewart | $ (31) | $ 66,108 | $ 19,306 | $ (6,768) | $ 11,373 | $ 17,554 | $ 22,377 | $ (3,781) | $ 78,615 | $ 47,523 | $ 48,659 |
Add (deduct): | |||||||||||
Depreciation | 22,526 | 24,932 | 25,878 | ||||||||
(Increase) decrease in receivables – net | (2,917) | 5,280 | (7,667) | ||||||||
Decrease (increase) in other assets – net | 6,865 | 4,469 | (4,512) | ||||||||
Increase (decrease) in payables and accrued liabilities – net | 31,471 | (12,002) | 1,933 | ||||||||
Income from subsidiaries | (3,044) | (1,940) | (2,163) | ||||||||
Other – net | 252 | 404 | 483 | ||||||||
Cash provided (used) by operating activities | 166,359 | 84,177 | 108,068 | ||||||||
Investing activities: | |||||||||||
Cash provided (used) by investing activities | 7,040 | 9,379 | (103,035) | ||||||||
Financing activities: | |||||||||||
Proceeds from notes payable | 30,464 | 14,530 | 56,493 | ||||||||
Payments on notes payable | (27,868) | (20,118) | (56,467) | ||||||||
Dividends paid | (28,345) | (28,263) | (28,135) | ||||||||
Repurchases of Common Stock | (532) | (1,175) | (727) | ||||||||
Purchase of remaining interest of consolidated subsidiary | 0 | (1,101) | (1,810) | ||||||||
Other – net | 25 | 0 | (1,298) | ||||||||
Cash used by financing activities | (37,762) | (47,758) | (43,595) | ||||||||
Increase (decrease) in cash and cash equivalents | 138,542 | 41,988 | (35,693) | ||||||||
Cash and cash equivalents at beginning of year | 192,067 | 150,079 | 192,067 | 150,079 | 185,772 | ||||||
Cash and cash equivalents at end of year | 330,609 | 192,067 | 330,609 | 192,067 | 150,079 | ||||||
Supplemental information: | |||||||||||
Income taxes paid | 11,992 | 12,854 | (1,642) | ||||||||
Interest paid | 4,241 | 4,214 | 3,466 | ||||||||
Parent Company | |||||||||||
Reconciliation of net income to cash provided (used) by operating activities: | |||||||||||
Net income attributable to Stewart | 78,615 | 47,523 | 48,659 | ||||||||
Add (deduct): | |||||||||||
Depreciation | 8 | 4 | 5 | ||||||||
(Increase) decrease in receivables – net | (253) | 922 | (81) | ||||||||
Decrease (increase) in other assets – net | 1,659 | 853 | (1,576) | ||||||||
Increase (decrease) in payables and accrued liabilities – net | 2,698 | (4,476) | 563 | ||||||||
Income from subsidiaries | (44,770) | (40,669) | (36,062) | ||||||||
Other – net | 1,530 | (5,124) | 1,705 | ||||||||
Cash provided (used) by operating activities | 39,487 | (967) | 13,213 | ||||||||
Investing activities: | |||||||||||
Dividends from subsidiary | 0 | 25,000 | 20,000 | ||||||||
Collections on notes receivables | 1,416 | 24,900 | 23,375 | ||||||||
Increases in notes receivables | 0 | (5,193) | (16,000) | ||||||||
Contributions to a subsidiary | 0 | 0 | (7,184) | ||||||||
Cash provided (used) by investing activities | 1,416 | 44,707 | 20,191 | ||||||||
Financing activities: | |||||||||||
Proceeds from notes payable | 0 | 0 | 16,000 | ||||||||
Payments on notes payable | 0 | 0 | (10,000) | ||||||||
Dividends paid | (28,345) | (28,263) | (28,135) | ||||||||
Repurchases of Common Stock | (532) | (1,175) | (727) | ||||||||
Purchase of remaining interest of consolidated subsidiary | 0 | (1,101) | (1,810) | ||||||||
Other – net | 0 | 0 | 0 | ||||||||
Cash used by financing activities | (28,877) | (30,539) | (24,672) | ||||||||
Increase (decrease) in cash and cash equivalents | 12,026 | 13,201 | 8,732 | ||||||||
Cash and cash equivalents at beginning of year | $ 24,823 | $ 11,622 | 24,823 | 11,622 | 2,890 | ||||||
Cash and cash equivalents at end of year | $ 36,849 | $ 24,823 | 36,849 | 24,823 | 11,622 | ||||||
Supplemental information: | |||||||||||
Income taxes paid | 0 | 0 | 0 | ||||||||
Interest paid | $ 4,009 | $ 3,849 | $ 3,128 |
Schedule I - Financial Inform_7
Schedule I - Financial Information of the Registrant (Parent Company) - Additional Information (Details) - USD ($) | Jan. 01, 2018 | Sep. 30, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 |
Condensed Financial Statements, Captions [Line Items] | |||||
Merger termination fee | $ 50,000,000 | $ 50,000,000 | |||
Dividends paid by guaranty | 0 | $ 25,000,000 | $ 20,000,000 | ||
Total income tax benefit resulting from the 2017 Act | 7,800,000 | ||||
ASU 2016-01 | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Net unrealized investment gains | $ 4,600,000 | ||||
Retained Earnings | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Reclassification of net tax expense from AOCI to retained earning | 1,000,000 | ||||
Retained Earnings | ASU 2018-02 | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Reclassification of net tax expense from AOCI to retained earning | 1,000,000 | ||||
Parent Company | |||||
Condensed Financial Statements, Captions [Line Items] | |||||
Merger termination fee | 50,000,000 | 0 | 0 | ||
Expenses related to Mergers and strategic alternatives review | 6,800,000 | $ 12,700,000 | 2,900,000 | ||
Executive insurance policy settlement expenses | $ 2,200,000 | ||||
Total income tax benefit resulting from the 2017 Act | $ 1,200,000 |
Schedule II - Valuation and Q_2
Schedule II - Valuation and Qualifying Accounts (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Estimated title losses | |||
Movement in Valuation Allowances and Reserves | |||
Balance at beginning of period | $ 461,560 | $ 480,990 | $ 462,572 |
Additions charged to costs and expenses | 84,423 | 71,514 | 96,532 |
Deductions | 86,930 | 90,944 | 78,114 |
Balance At end of period | 459,053 | 461,560 | 480,990 |
Valuation allowance for deferred tax assets | |||
Movement in Valuation Allowances and Reserves | |||
Balance at beginning of period | 3,824 | 2,231 | 2,457 |
Additions charged to costs and expenses | 236 | 1,791 | 0 |
Deductions | 4 | 198 | 226 |
Balance At end of period | 4,056 | 3,824 | 2,231 |
Allowance for uncollectible amounts | |||
Movement in Valuation Allowances and Reserves | |||
Balance at beginning of period | 4,614 | 5,156 | 9,647 |
Additions charged to costs and expenses | 1,672 | 519 | 207 |
Deductions | 1,817 | 1,061 | 4,698 |
Balance At end of period | $ 4,469 | $ 4,614 | $ 5,156 |
Uncategorized Items - stewart20
Label | Element | Value |
AOCI Attributable to Parent [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ (3,592,000) |
Retained Earnings [Member] | ||
Cumulative Effect of New Accounting Principle in Period of Adoption | us-gaap_CumulativeEffectOfNewAccountingPrincipleInPeriodOfAdoption | $ 3,592,000 |