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Investments (Tables)

9 Months Ended

Sep. 30, 2020

Debt Securities, Available-for-sale [Line Items]

Investments Classified by Contractual Maturity Date

The amortized cost and estimated fair values of the Company’s Investments in Fixed Maturities at September 30, 2020 by contractual maturity were:

(Dollars in Millions)						Amortized Cost						Fair Value
Due in One Year or Less						$	122.6					$	124.2
Due after One Year to Five Years						1,060.5						1,117.0
Due after Five Years to Ten Years						1,616.8						1,812.8
Due after Ten Years						2,475.7						3,012.0
Mortgage- and Asset-backed Securities Not Due at a Single Maturity Date						1,419.2						1,438.8
Investments in Fixed Maturities						$	6,694.8					$	7,504.8

Schedule of Unrealized Loss on Investments

An aging of unrealized losses on the Company’s Investments in Fixed Maturities at September 30, 2020 is presented below.

						Less Than 12 Months												12 Months or Longer												Total
(Dollars in Millions)						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Fixed Maturities:
U.S. Government and Government Agencies and Authorities						$	2.3					$	—					$	—					$	—					$	2.3					$	—
States and Political Subdivisions						28.5						(1.6)						—						—						28.5						(1.6)
Foreign Governments						2.5						(0.2)						2.4						(1.0)						4.9						(1.2)
Corporate Securities:
Bonds and Notes						336.2						(15.5)						24.7						(3.0)						360.9						(18.5)
Collateralized Loan Obligations						276.4						(11.6)						321.0						(22.3)						597.4						(33.9)
Other Mortgage- and Asset-backed						1.4						—						—						—						1.4						—
Total Fixed Maturities						$	647.3					$	(28.9)					$	348.1					$	(26.3)					$	995.4					$	(55.2)

An aging of unrealized losses on the Company’s Investments in Fixed Maturities at December 31, 2019 is presented below.

						Less Than 12 Months												12 Months or Longer												Total
(Dollars in Millions)						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses						Fair Value						Unrealized Losses
Fixed Maturities:
U.S. Government and Government Agencies and Authorities						$	118.5					$	(1.3)					$	5.1					$	—					$	123.6					$	(1.3)
States and Political Subdivisions						63.0						(0.7)						5.4						(0.4)						68.4						(1.1)
Foreign Governments						1.0						(0.3)						3.1						(1.3)						4.1						(1.6)
Corporate Securities:
Bonds and Notes						160.0						(2.1)						70.7						(5.0)						230.7						(7.1)
Redeemable Preferred Stocks						5.5						(0.1)						—						—						5.5						(0.1)
Collateralized Loan Obligations						95.5						(1.9)						355.6						(6.6)						451.1						(8.5)
Other Mortgage- and Asset-backed						72.8						(1.1)						—						—						72.8						(1.1)
Total Fixed Maturities						$	516.3					$	(7.5)					$	439.9					$	(13.3)					$	956.2					$	(20.8)

Allowance for Credit Losses

The following table sets forth the change in allowance for credit losses on fixed maturities available-for-sale by major security type for nine months ended September 30, 2020.

												Foreign Governments						Corporate Bonds and Notes												Total
(Dollars in Millions)
Allowance for Credit Losses at Beginning of the Year												$	—					$	—											$	—
Impact of Adopting ASU 2016-13												—						—												—
Additions for Securities for which No Previous Expected Credit Losses were Recognized												0.6						5.0												5.6
Reduction Due to Sales												(0.1)						(0.4)												(0.5)
Net Increase (Decrease) in Allowance on Previously Impaired Securities												0.1						(0.1)												—
Write-offs Charged Against Allowance												—						(0.3)												(0.3)
Allowance for Credit Losses at End of Period												$	0.6					$	4.2											$	4.8

Note 2 - Investments (continued)

The following table sets forth the change in allowance for credit losses on fixed maturities available-for-sale by major security type for the three months ended September 30, 2020.

												Foreign Governments						Corporate Bonds and Notes												Total
(Dollars in Millions)
Allowance for Credit Losses at Beginning of the Period												$	0.6					$	4.8											$	5.4
Additions for Securities for which No Previous Expected Credit Losses were Recognized												—						0.2												0.2
Reduction Due to Sales												(0.1)						(0.4)												(0.5)
Net Increase (Decrease) in Allowance on Previously Impaired Securities												0.1						(0.1)												—
Write-offs Charged Against Allowance												—						(0.3)												(0.3)
Allowance for Credit Losses at End of Period												$	0.6					$	4.2											$	4.8

Schedule of Other Investments

The carrying values of the Company’s Other Investments at September 30, 2020 and December 31, 2019 were:

(Dollars in Millions)						Sep 30, 2020						Dec 31, 2019
Company-owned Life Insurance						$	326.1					$	217.0
Loans to Policyholders at Unpaid Principal						299.5						305.6
Real Estate at Depreciated Cost						99.6						111.4
Mortgage Loans and Other						37.6						27.5
Total						$	762.8					$	661.5

Investment Income

Net Investment Income for the nine and three months ended September 30, 2020 and 2019 was:

						Nine Months Ended												Three Months Ended
(Dollars in Millions)						Sep 30, 2020						Sep 30, 2019						Sep 30, 2020						Sep 30, 2019
Investment Income (Loss):
Interest on Fixed Income Securities						$	218.0					$	225.5					$	72.7					$	73.5
Dividends on Equity Securities Excluding Alternative Investments						10.7						14.6						2.8						5.2
Alternative Investments:
Equity Method Limited Liability Investments						(2.7)						0.6						8.2						1.6
Limited Liability Investments Included in Equity Securities						7.3						12.9						2.4						5.2
Total Alternative Investments						4.6						13.5						10.6						6.8
Short-term Investments						4.2						6.9						2.3						2.5
Loans to Policyholders						16.6						16.9						5.5						5.9
Real Estate						7.1						7.1						2.3						2.4
Other						9.3						0.9						2.7						0.6
Total Investment Income						270.5						285.4						98.9						96.9
Investment Expenses:
Real Estate						6.5						7.2						1.2						2.5
Other Investment Expenses						18.5						7.8						5.6						2.7
Total Investment Expenses						25.0						15.0						6.8						5.2
Net Investment Income						$	245.5					$	270.4					$	92.1					$	91.7

Schedule of Realized Gain (Loss)

Gross gains and losses on sales of investments in fixed maturities for the nine and three months ended September 30, 2020 and 2019 were:

						Nine Months Ended												Three Months Ended
(Dollars in Millions)						Sep 30, 2020						Sep 30, 2019						Sep 30, 2020						Sep 30, 2019
Fixed Maturities:
Gains on Sales						$	38.7					$	39.7					$	11.9					$	1.9
Losses on Sales						(3.5)						(4.8)						(1.9)						(0.3)

Investments in Fixed Maturities

Debt Securities, Available-for-sale [Line Items]

Schedule of Available-for-sale Securities Reconciliation

The amortized cost and estimated fair values of the Company’s Investments in Fixed Maturities at September 30, 2020 were:

						Amortized Cost						Gross Unrealized												Allowance for Expected Credit Losses						Fair Value
(Dollars in Millions)												Gains						Losses
U.S. Government and Government Agencies and Authorities						$	596.6					$	56.2					$	—					$	—					$	652.8
States and Political Subdivisions						1,334.3						178.9						(1.6)						—						1,511.6
Foreign Governments						6.7						—						(1.2)						(0.6)						4.9
Corporate Securities:
Bonds and Notes						3,786.8						611.6						(18.5)						(4.2)						4,375.7
Redeemable Preferred Stocks						6.7						0.6						—						—						7.3
Collateralized Loan Obligations						759.5						1.8						(33.9)						—						727.4
Other Mortgage- and Asset-backed						204.2						20.9						—						—						225.1
Investments in Fixed Maturities						$	6,694.8					$	870.0					$	(55.2)					$	(4.8)					$	7,504.8

The amortized cost and estimated fair values of the Company’s Investments in Fixed Maturities at December 31, 2019 were:

						Amortized Cost						Gross Unrealized												Fair Value
(Dollars in Millions)												Gains						Losses
U.S. Government and Government Agencies and Authorities						$	784.7					$	32.5					$	(1.3)					$	815.9
States and Political Subdivisions						1,386.4						130.5						(1.1)						1,515.8
Foreign Governments						17.2						1.2						(1.6)						16.8
Corporate Securities:
Bonds and Notes						3,465.0						401.8						(7.1)						3,859.7
Redeemable Preferred Stocks						6.8						—						(0.1)						6.7
Collateralized Loan Obligations						624.6						2.1						(8.5)						618.2
Other Mortgage- and Asset-backed						88.0						2.1						(1.1)						89.0
Investments in Fixed Maturities						$	6,372.7					$	570.2					$	(20.8)					$	6,922.1

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