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Employee Benefit Plans | 12 Months Ended
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Dec. 31, 2021
Compensation And Retirement Disclosure [Abstract] |
Employee Benefit Plans | NOTE 17. Employee Benefit Plans: The First American Financial Corporation 401(k) Savings Plan (the “Savings Plan”) allows for employee-elective contributions up to the maximum amount as determined by the Internal Revenue Code. The Company makes discretionary contributions to the Savings Plan based on profitability, as well as the contributions of participants. The Savings Plan held 1.7 million shares and 1.8 million shares of the Company’s common stock, representing 1.6% and 1.7% of the Company’s total common shares outstanding at December 31, 2021 and 2020, respectively. Effective July 1, 2015, additional investments in common stock of the Company are no longer allowed. The Company maintains a deferred compensation plan for certain employees that allows participants to defer up to 100% of their salary, commissions and certain bonuses. Participants can allocate their deferrals among a variety of investment crediting options (known as “deemed investments”). The term deemed investments means that the participant has no ownership interest in the funds they select; the funds are only used to measure the gains or losses that will be attributed to each participant’s deferral account over time. Participants can elect to have their deferral balance paid out while they are still employed or after their employment ends. The deferred compensation plan is exempt from most provisions of the Employee Retirement Income Security Act (“ERISA”) because it is only available to a select group of management and highly compensated employees and is not a qualified employee benefit plan. To preserve the tax-deferred savings advantages of a nonqualified deferred compensation plan, federal law requires that it be unfunded or informally funded. Participant deferrals, and any earnings on those deferrals, are general unsecured obligations of the Company. The Company informally funds the deferred compensation plan through a tax-advantaged investment known as variable universal life insurance. Deferred compensation plan assets are held as an asset of the Company within a special trust, known as a “Rabbi Trust.” At December 31, 2021 and 2020, the value of the assets held in the Rabbi Trust of $134 million and $116 million, respectively, and the unfunded liabilities of $153 million and $131 million, respectively, were included in the consolidated balance sheets in other assets and pension costs and other retirement plans, respectively. The Company also has nonqualified, unfunded supplemental benefit plans covering certain management personnel. The Executive and Management Supplemental Benefit Plans, subject to certain limitations, provide participants with maximum annual benefits of 30% and 15%, respectively, of average annual compensation over a fixed five-year period. Effective January 1, 2011, the plans were closed to new participants. Certain of the Company’s subsidiaries have separate savings and employee benefit plans. Expenses related to these plans and the Company’s deferred compensation plan are included below under other plans, net. The principal components of employee benefit costs are summarized as follows:
| Year ended December 31, |
| 2021 |  |  | 2020 |  |  | 2019 |
| (in millions) |
Expense: |  |  |  |  |  |  |  |  |  |  |
Savings plan | $ | 74 |  |  | $ | 32 |  |  | $ | 60 |
Unfunded supplemental benefit plans |  | 11 |  |  |  | 9 |  |  |  | 9 |
Other plans, net |  | 24 |  |  |  | 19 |  |  |  | 24 |
| $ | 109 |  |  | $ | 60 |  |  | $ | 93 |
The following table summarizes the benefit obligations and funded status associated with the Company’s unfunded supplemental benefit plans:
| December 31, |
| 2021 |  |  | 2020 |
| (in millions) |
Change in projected benefit obligation: |  |  |  |  |  |  |
Benefit obligation at beginning of year | $ | 283 |  |  | $ | 259 |
Interest costs |  | 5 |  |  |  | 7 |
Actuarial (gains) losses |  | (11 | ) |  |  | 31 |
Benefits paid |  | (15 | ) |  |  | (14 | )
Projected benefit obligation at end of year |  | 262 |  |  |  | 283 |
Change in plan assets: |  |  |  |  |  |  |
Contributions |  | 14 |  |  |  | 14 |
Benefits paid |  | (14 | ) |  |  | (14 | )
Fair value of plan assets at end of year |  | — |  |  |  | — |
Reconciliation of funded status: |  |  |  |  |  |  |
Unfunded status of the plans | $ | 262 |  |  | $ | 283 |
Amounts recognized in the consolidated balance sheet: |  |  |  |  |  |  |
Accrued benefit liability | $ | 262 |  |  | $ | 283 |
Amounts recognized in accumulated other comprehensive income/loss: |  |  |  |  |  |  |
Unrecognized net actuarial loss | $ | 111 |  |  | $ | 129 |
Unrecognized prior service credit |  | — |  |  |  | (1 | )
| $ | 111 |  |  | $ | 128 |
Accumulated benefit obligation at end of year | $ | 262 |  |  | $ | 283 |
Net periodic benefit costs related to the Company’s unfunded supplemental benefit pension plans included the following components:
| Year ended December 31, |
| 2021 |  |  | 2020 |  |  | 2019 |
| (in millions) |
Expense: |  |  |  |  |  |  |  |  |  |  |
Interest costs | $ | 5 |  |  | $ | 7 |  |  | $ | 9 |
Amortization of net actuarial loss |  | 7 |  |  |  | 5 |  |  |  | 4 |
Amortization of prior service credit |  | (1 | ) |  |  | (3 | ) |  |  | (4 | )
| $ | 11 |  |  | $ | 9 |  |  | $ | 9 |
Net actuarial loss for the unfunded supplemental benefit plans expected to be amortized from accumulated other comprehensive income/loss into net periodic benefit cost during 2022 is $6 million. The weighted-average discount rate assumptions used to determine net periodic benefit costs for the Company’s unfunded supplemental benefit plans for the years ended December 31, 2021, 2020 and 2019, are as follows:
| Year ended December 31, |
| 2021 |  |  | 2020 |  |  | 2019 |
Discount rates: |  |  |  |  |  |  |  |  |  |  |
Projected benefit obligation |  | 2.49 | % |  |  | 3.27 | % |  |  | 4.32 | %
Service cost |  | 3.14 | % |  |  | 3.71 | % |  |  | 4.55 | %
Interest cost |  | 1.83 | % |  |  | 2.86 | % |  |  | 4.00 | %
The weighted-average discount rate assumptions used to determine the projected benefit obligations for the Company’s unfunded supplemental benefit plans at December 31, 2021 and 2020, are as follows:
| December 31, |
| 2021 |  |  | 2020 |
Discount rate |  | 2.89 | % |  |  | 2.49 | %
The discount rate assumptions used for the Company’s benefit plans reflect the yield available on high-quality, fixed-income debt securities that match the expected timing of the benefit obligation payments. The Company expects to make cash contributions of $16 million to its unfunded supplemental benefit plans during 2022. Benefit payments, which reflect expected future service, as appropriate, are expected to be made as follows:
Year | (in millions) |
2022 | $ | 16 |
2023 | $ | 17 |
2024 | $ | 17 |
2025 | $ | 17 |
2026 | $ | 17 |
Five years thereafter | $ | 79 |

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- Definition The entire disclosure of an entity's employee compensation and benefit plans, excluding share-based compensation and including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 712 -URI http://asc.fasb.org/topic&trid=2197446 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 715 -URI http://asc.fasb.org/topic&trid=2235017 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 710 -URI http://asc.fasb.org/topic&trid=2127225 + Details
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