XML 30 R18.htm IDEA: XBRL DOCUMENT v3.8.0.1

Fair Values of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2017

Fair Value Disclosures [Abstract]

Carrying Amounts and Fair Values of Financial Instruments

The following sets forth a comparison of the carrying amounts and fair values of our financial instruments:

	September 30, 2017								December 31, 2016
	Carrying Amount				Fair Value				Carrying Amount				Fair Value
	(Dollars in thousands)
Assets
Fixed maturity securities:
Available for sale	$	44,601,297			$	44,601,297			$	41,060,494			$	41,060,494
Held for investment	76,986				75,046				76,825				68,766
Mortgage loans on real estate	2,611,426				2,625,709				2,480,956				2,522,035
Derivative instruments	1,235,125				1,235,125				830,519				830,519
Other investments	328,299				318,802				308,774				300,918
Cash and cash equivalents	1,285,662				1,285,662				791,266				791,266
Coinsurance deposits	4,758,417				4,262,511				4,639,492				4,150,792
Interest rate caps	370				370				1,082				1,082
Counterparty collateral	125,940				125,940				145,693				145,693
Liabilities
Policy benefit reserves	54,578,829				45,513,913				51,280,331				43,104,183
Single premium immediate annuity (SPIA) benefit reserves	283,503				293,282				297,724				308,028
Notes and loan payable	493,972				533,800				493,755				519,440
Subordinated debentures	242,145				240,752				241,853				225,106
Amounts due under repurchase agreements	23,542				23,542				—				—
Interest rate swap	1,687				1,687				2,113				2,113

Assets and Liabilities Measured at Fair Value on a Recurring Basis, By Fair Value Hierarchy Level

Our assets and liabilities which are measured at fair value on a recurring basis as of September 30, 2017 and December 31, 2016 are presented below based on the fair value hierarchy levels:

	Total Fair Value				Quoted Prices in Active Markets (Level 1)				Significant Other Observable Inputs (Level 2)				Significant Unobservable Inputs (Level 3)
	(Dollars in thousands)
September 30, 2017
Assets
Fixed maturity securities:
Available for sale:
United States Government full faith and credit	$	11,935			$	5,704			$	6,231			$	—
United States Government sponsored agencies	1,302,075				—				1,302,075				—
United States municipalities, states and territories	4,093,632				—				4,093,632				—
Foreign government obligations	240,400				—				240,400				—
Corporate securities	29,675,924				7				29,675,917				—
Residential mortgage backed securities	1,146,822				—				1,146,822				—
Commercial mortgage backed securities	5,532,483				—				5,532,483				—
Other asset backed securities	2,598,026				—				2,598,026				—
Other investments: equity securities, available for sale	7,427				—				7,427				—
Derivative instruments	1,235,125				—				1,235,125				—
Cash and cash equivalents	1,285,662				1,285,662				—				—
Interest rate caps	370				—				370				—
Counterparty collateral	125,940				—				125,940				—
	$	47,255,821			$	1,291,373			$	45,964,448			$	—
Liabilities
Interest rate swap	$	1,687			$	—			$	1,687			$	—
Fixed index annuities - embedded derivatives	8,069,105				—				—				8,069,105
	$	8,070,792			$	—			$	1,687			$	8,069,105
December 31, 2016
Assets
Fixed maturity securities:
Available for sale:
United States Government full faith and credit	$	11,805			$	5,381			$	6,424			$	—
United States Government sponsored agencies	1,344,787				—				1,344,787				—
United States municipalities, states and territories	3,926,950				—				3,926,950				—
Foreign government obligations	236,341				—				236,341				—
Corporate securities	27,114,418				6				27,114,412				—
Residential mortgage backed securities	1,254,835				—				1,254,835				—
Commercial mortgage backed securities	5,365,235				—				5,365,235				—
Other asset backed securities	1,806,123				—				1,806,123				—
Other investments: equity securities, available for sale	8,000				—				8,000				—
Derivative instruments	830,519				—				830,519				—
Cash and cash equivalents	791,266				791,266				—				—
Interest rate caps	1,082				—				1,082				—
Counterparty collateral	145,693				—				145,693				—
	$	42,837,054			$	796,653			$	42,040,401			$	—
Liabilities
Interest rate swap	$	2,113			$	—			$	2,113			$	—
Fixed index annuities - embedded derivatives	6,563,288				—				—				6,563,288
	$	6,565,401			$	—			$	2,113			$	6,563,288

Schedule of Assumptions Used in Estimating Fair Value

The following table presents average lapse rate and partial withdrawal rate assumptions, by contract duration, used in estimating the fair value of the embedded derivative component of our fixed index annuity policy benefit reserves at each reporting date:

		Average Lapse Rates				Average Partial Withdrawal Rates
Contract Duration (Years)		September 30, 2017		December 31, 2016		September 30, 2017		December 31, 2016
1 - 5		1.83%		1.76%		3.32%		3.30%
6 - 10		7.03%		6.58%		3.32%		3.30%
11 - 15		11.29%		11.25%		3.34%		3.32%
16 - 20		11.97%		12.04%		3.20%		3.18%
20+		11.63%		11.68%		3.20%		3.18%

Liabilities Measured at Fair Value on Recurring Basis, Level 3 Reconciliation

The following table provides a reconciliation of the beginning and ending balances for our Level 3 liabilities, which are measured at fair value on a recurring basis using significant unobservable inputs for the three and nine months ended September 30, 2017 and 2016:

	Three Months Ended   September 30,								Nine Months Ended   September 30,
	2017				2016				2017				2016
	(Dollars in thousands)
Fixed index annuities - embedded derivatives
Beginning balance	$	7,552,365			$	6,499,015			$	6,563,288			$	5,983,622
Premiums less benefits	475,600				137,526				1,384,791				273,287
Change in fair value, net	41,140				41,561				121,026				421,193
Ending balance	$	8,069,105			$	6,678,102			$	8,069,105			$	6,678,102

X

- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13476-108611

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 11
-URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13467-108611

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6447952&loc=d3e13220-108610

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 10
-Subparagraph (a)
-URI http://asc.fasb.org/extlink&oid=73719730&loc=d3e13433-108611

+ Details

Name:	us-gaap_FairValueByBalanceSheetGroupingTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- References

No definition available.

+ Details

Name:	us-gaap_FairValueDisclosuresAbstract
Namespace Prefix:	us-gaap_
Data Type:	xbrli:stringItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the fair value measurement of liabilities using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets), and gains or losses recognized in other comprehensive income (loss) and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs) by class of liability.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19279-110258

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 2
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19207-110258

+ Details

Name:	us-gaap_FairValueLiabilitiesMeasuredOnRecurringBasisUnobservableInputReconciliationTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of the underlying assumptions and percentages or rates used in determining the fair value of guarantee obligations for each type of long-duration contract.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6482852&loc=d3e14931-158439

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6482852&loc=d3e14944-158439

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6482852&loc=d3e14937-158439

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 30
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6481800&loc=d3e11318-158416

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 80
-Section 50
-Paragraph 1
-Subparagraph (c)
-URI http://asc.fasb.org/extlink&oid=6484115&loc=d3e19393-158473

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 20
-Section 55
-Paragraph 15
-URI http://asc.fasb.org/extlink&oid=6588021&loc=d3e7104-158389

+ Details

Name:	us-gaap_ScheduleOfAssumptionsForLongDurationContractsByProductAndGuaranteeTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration

X

- Definition

Tabular disclosure of assets and liabilities, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 820
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=66048111&loc=d3e19190-110258

+ Details

Name:	us-gaap_ScheduleOfFairValueAssetsAndLiabilitiesMeasuredOnRecurringBasisTableTextBlock
Namespace Prefix:	us-gaap_
Data Type:	nonnum:textBlockItemType
Balance Type:	na
Period Type:	duration