
($ in thousands)	2020		2019	2018
AFS securities:
Fixed income securities	$	386,380	215,634	2,302

Total AFS securities	386,380		215,634	2,302

HTM securities:
Fixed income securities	7		31	89
Total HTM securities	7		31	89

Short-term securities	6		23	—

Total net unrealized gains	386,393		215,688	2,391
Deferred income tax	(81,142)		(45,294)	(502)
Net unrealized gains, net of deferred income tax	305,251		170,394	1,889

Cumulative effect adjustment due to accounting change for equity unrealized1	—		—	30,726
Cumulative effect adjustment due to accounting changes for stranded tax assets1	—		—	(17,920)
Increase (decrease) in net unrealized gains in OCI, net of deferred income tax	$	134,857	168,505	(65,881)

1Upon adoption of ASU 2016-01, we recognized a $30.7 million cumulative-effect adjustment to the opening balance of AOCI, which represents the after-tax net unrealized gain on our equity portfolio as of December 31, 2018. Additionally, upon adoption of ASU 2018-02, we recognized a one-time reclassification from AOCI to retained earnings for $17.9 million representing the stranded tax assets related to our investment portfolio that were created in AOCI from the enactment of the Tax Cuts and Jobs Act of 2017.


December 31, 2020
	Cost/
	Amortized		Allowance for	Unrealized	Unrealized	Fair
($ in thousands)	Cost		Credit Losses	Gains	Losses	Value
AFS fixed income securities:
U.S. government and government agencies	$	110,038	—	6,239	(137)	116,140
Foreign government	16,801		(1)	1,569	(3)	18,366
Obligations of states and political subdivisions	1,159,588		(4)	87,564	(11)	1,247,137
Corporate securities	2,152,203		(2,782)	180,971	(2,340)	2,328,052
CLO and other ABS	1,014,820		(592)	20,166	(7,843)	1,026,551
RMBS	999,485		(561)	53,065	(201)	1,051,788
CMBS	620,582		(29)	48,348	(1,007)	667,894
Total AFS fixed income securities	$	6,073,517	(3,969)	397,922	(11,542)	6,455,928


December 31, 2019
	Cost/
	Amortized		Unrealized	Unrealized	Fair
($ in thousands)	Cost		Gains	Losses	Value
AFS fixed income securities:
U.S. government and government agencies	$	112,680	3,506	—	116,186
Foreign government	18,011		533	(2)	18,542
Obligations of states and political subdivisions	1,168,185		62,175	(270)	1,230,090
Corporate securities	1,866,881		81,906	(1,310)	1,947,477
CLO and other ABS	790,517		7,929	(5,434)	793,012
RMBS	1,409,003		43,421	(455)	1,451,969
CMBS	514,709		23,902	(267)	538,344
Total AFS fixed income securities	$	5,879,986	223,372	(7,738)	6,095,620


2020
($ in thousands)	Beginning Balance		Current Provisions for Securities without Prior Allowance	Increase (Decrease) on Securities with Prior Allowance, excluding intent (or Requirements) to Sell Securities	Reductions for Securities Sold	Reductions for Securities Identified as Intent (or Requirement) to Sell during the Period	Ending Balance
Foreign Government	$	—	19	—	(18)	—	1
Obligations of states and political subdivisons	—		4	—	—	—	4
Corporate Securities	—		3,645	—	(781)	(82)	2,782
CLO and other ABS	—		722	—	(113)	(17)	592
RMBS	—		623	—	(62)	—	561
CMBS	—		29	—	—	—	29
Total AFS fixed income securities	$	—	5,042	—	(974)	(99)	3,969

During 2020, we did not have any write-offs or recoveries of our AFS fixed income securities and we did not purchase any assets with credit deterioration, so these items are not included in the table above.


December 31, 2020	Less than 12 months			12 months or longer		Total
($ in thousands)	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
AFS fixed income securities:
U.S. government and government agencies	$	11,519	(137)	—	—	11,519	(137)
Foreign government	1,122		(3)	—	—	1,122	(3)
Obligations of states and political subdivisions	2,223		(11)	—	—	2,223	(11)
Corporate securities	65,187		(2,152)	2,400	(188)	67,587	(2,340)
CLO and other ABS	261,746		(2,995)	165,661	(4,848)	427,407	(7,843)
RMBS	18,227		(194)	1,181	(7)	19,408	(201)
CMBS	55,482		(616)	16,093	(391)	71,575	(1,007)
Total AFS fixed income securities	$	415,506	(6,108)	185,335	(5,434)	600,841	(11,542)


December 31, 2019	Less than 12 months			12 months or longer		Total
($ in thousands)	Fair Value		Unrealized Losses	Fair Value	Unrealized Losses	Fair Value	Unrealized Losses
AFS fixed income securities:
U.S. government and government agencies	$	—	—	—	—	—	—
Foreign government	1,416		(2)	—	—	1,416	(2)
Obligations of states and political subdivisions	35,838		(270)	—	—	35,838	(270)
Corporate securities	84,832		(480)	20,182	(830)	105,014	(1,310)
CLO and other ABS	205,191		(1,938)	204,385	(3,496)	409,576	(5,434)
RMBS	126,089		(425)	5,375	(30)	131,464	(455)
CMBS	62,893		(264)	828	(3)	63,721	(267)
Total AFS fixed income securities	$	516,259	(3,379)	230,770	(4,359)	747,029	(7,738)

We do not currently intend to sell any of the securities in the tables above, nor will we be required to sell any of these securities. Considering these factors and our review of these securities under our credit loss policy as described in Note 2. “Summary of Significant Accounting Policies” of this Form 10-K, we have concluded that no ACL is required on these balances. This conclusion reflects our current judgment as to the financial position and future prospects of the entity that issued the investment security and underlying collateral.

(d) Fixed income securities at December 31, 2020, by contractual maturity are shown below. Mortgage-backed securities are included in the maturity tables using the estimated average life of each security. Expected maturities may differ from


	AFS		HTM
($ in thousands)	Fair Value		Carrying Value	Fair Value
Due in one year or less	$	433,241	1,132	1,149
Due after one year through five years	3,639,658		15,692	16,852
Due after five years through 10 years	1,910,480		—	—
Due after 10 years	472,549		—	—
Total fixed income securities	$	6,455,928	16,824	18,001


Other Investments	December 31, 2020				December 31, 2019
($ in thousands)	Carrying Value		Remaining Commitment	Maximum Exposure to Loss1	Carrying Value	Remaining Commitment	Maximum Exposure to Loss1
Alternative Investments
Private equity	$	157,276	100,905	258,181	118,352	93,138	211,490
Private credit	54,017		98,330	152,347	42,532	105,340	147,872
Real assets	19,659		16,493	36,152	23,256	20,741	43,997




Total alternative investments	230,952		215,728	446,680	184,140	219,219	403,359
Other securities	35,370		—	35,370	32,667	—	32,667
Total other investments	$	266,322	215,728	482,050	216,807	219,219	436,026

1In addition to the amounts in this table, previously recognized tax credits are subject to the risk of recapture. We do not consider this significant and therefore do not include in this table.

We have reviewed various investments included in the table above and have concluded that they are VIEs, but that we are not the primary beneficiary and therefore, consolidation is not required. We do not have a future obligation to fund losses or debts on behalf of these investments; however, we are contractually committed to make additional investments up to the remaining commitment outlined above. We did not provide any non-contractual financial support at any time during 2020 or 2019.

•Primary Private Equity: This strategy makes private equity investments, primarily in established large and middle market companies across diverse industries globally, with an emphasis on North America.

•Secondary Private Equity: This strategy purchases seasoned private equity funds from investors desiring liquidity prior to normal fund termination. Investments are made across all sectors of the private equity market, including leveraged buyouts ("LBO"), venture capital, distressed securities, mezzanine financing, real estate, and infrastructure.

•Venture Capital: In general, these investments are made principally by investing in equity securities of startup companies and small-to-medium sized privately-held corporations with strong long-term growth potential. This strategy makes private equity investments in seed stage, early stage, late stage, and growth equity partnerships.

•Direct Lending: This strategy provides privately negotiated loans to U.S. middle market companies. Typically, these are floating rate, senior secured loans diversified across industries. Loans are made to companies that may or may not have private equity sponsors to finance LBOs, recapitalizations, and acquisitions.

•Mezzanine Financing: This strategy provides privately-negotiated fixed income securities, generally with an equity component, to LBO firms and private and publicly-traded large, mid, and small-cap companies to finance LBOs, recapitalizations, and acquisitions.

•Opportunistic and Distressed Debt: This strategy makes investments in debt and equity securities of companies that are experiencing financial distress, operational issues, or dislocated pricing of publicly-traded securities. Investments

include buying indebtedness of bankrupt or financially-troubled companies, small balance loan portfolios, special situations and capital structure arbitrage trades, commercial real estate mortgages, and similar non-U.S. securities and debt obligations.

•Infrastructure: This strategy invests in the equity or debt of cash flow generating assets, diversified across a variety of industries, including transportation, energy infrastructure, renewable power, such as wind and solar, social infrastructure, power generation, water, telecom, and other regulated entities principally located in North America and Western Europe.

•Real Estate: This strategy invests in real estate in North America, Europe, and Asia via direct property ownership, joint ventures, mortgages, and investments in equity and debt instruments.

Our alternative investment strategies may employ leverage and may use hedging to reduce foreign exchange or interest rate volatility. At this time, our alternative investment strategies do not include hedge funds. We typically cannot redeem our investments with the general partners of these investments; however, occasionally these partnerships can be traded on the secondary market. Once liquidation is triggered by clauses within the limited partnership agreements or at the funds’ stated end date, we will receive our final allocation of capital and any earned appreciation of the underlying investments, assuming we have not divested ourselves of our partnership interests prior to that time. We currently receive distributions from these alternative investments through the realization of the underlying investments or income generated in the limited partnerships.

The following tables show gross summarized financial information for our other investments portfolio, including the portion we do not own. The investments are carried under the equity method of accounting. The last line in the income statement information table below reflects our portion of the aggregate results that are included in our Financial Statements. As the majority of these investments report results to us on a one quarter lag, the summarized financial statement information is as of, and for the 12-month period ended, September 30:


Balance Sheet Information
December 31,
($ in millions)	2020		2019
Investments	$	55,145	43,857
Total assets	58,819		45,432
Total liabilities	6,744		5,670
Total partners’ capital	52,075		39,762


Income Statement Information
12 months ended September 30,
($ in millions)	2020		2019	2018
Net investment (loss) income	$	(26)	(8)	134
Realized gains	1,452		695	1,981
Net change in unrealized appreciation	4,898		5,543	1,303
Net income before tax	$	6,324	6,230	3,418

Alternative investment income included in "Net investment income earned" on our Consolidated Statements of Income	26.5		17.9	17.6

(f) We did not have exposure to any credit concentration risk of a single issuer greater than 10% of our stockholders' equity, other than certain U.S. government agencies, as of December 31, 2020 or December 31, 2019.

(g) We have pledged certain AFS fixed income securities as collateral related to our relationships with the Federal Home Loan Bank of Indianapolis ("FHLBI") and the Federal Home Loan Bank of New York ("FHLBNY"). In addition, certain securities were on deposit with various state and regulatory agencies at December 31, 2020 to comply with insurance laws. We retain all rights regarding all securities pledged as collateral.


($ in millions)	FHLBI Collateral		FHLBNY Collateral	State and Regulatory Deposits	Total
U.S. government and government agencies	$	—	—	20.1	20.1
Obligations of states and political subdivisions	—		—	5.1	5.1

RMBS	125.0		178.1	—	303.1
CMBS	7.0		36.3	—	43.3
Total pledged as collateral	$	132.0	214.4	25.2	371.6


($ in thousands)	2020		2019	2018
Fixed income securities	$	203,926	203,255	178,104
CMLs	844		—	—
Equity securities	9,286		6,996	7,764
Short-term investments	1,821		6,653	3,472
Other investments	26,922		18,778	17,799
Investment expenses	(15,692)		(13,139)	(11,803)
Net investment income earned	$	227,107	222,543	195,336


($ in thousands)	2020		2019	2018
Gross gains on sales	$	18,893	31,910	28,672
Gross losses on sales	(9,745)		(5,195)	(47,647)
Net realized gains (losses) on disposals	9,148		26,715	(18,975)
Net unrealized gains (losses) on equity securities	7,939		(8,649)	(29,369)
Net credit loss (expense) benefit on fixed maturities, AFS	(5,042)
Net credit loss benefit (expense) on fixed maturities, HTM	4
Losses on securities for which we have the intent to sell	(16,266)
Net OTTI losses recognized in earnings			(3,644)	(6,579)
Net realized and unrealized gains (losses)	$	(4,217)	14,422	(54,923)


($ in thousands)	2020		2019	2018
Unrealized gains (losses) recognized in income on equity securities:
On securities remaining in our portfolio at end of period	$	7,936	1,219	(3,098)
On securities sold in period	3		(9,868)	(26,271)
Total unrealized (losses) recognized in income on equity securities	$	7,939	(8,649)	(29,369)

Proceeds from the sales of AFS fixed income securities were $487.1 million, $594.7 million, and $2,030.7 million in 2020, 2019, and 2018, respectively. Proceeds from the sales of equity securities were $1.3 million, $137.3 million, and $113.3 million in 2020, 2019, and 2018, respectively.

Losses on securities for which we have the intent to sell of $16.3 million were recorded in 2020 to provide our investment managers flexibility to trade and optimize our investment portfolio. Corporate securities accounted for $12.1 million of the losses on securities for which we have the intent to sell.