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Investments (Tables)

12 Months Ended

Dec. 31, 2020

Investments [Abstract]

Schedule of Fixed Maturity Securities

At December 31, 2020 and 2019, the amortized cost and fair value of fixed maturity securities were as follows:

			Amortized Cost (1)						Gross Unrealized Gains						Gross Unrealized Losses (2)						Allowance for Credit Losses						Fair Value
			(Dollars in thousands)
December 31, 2020
Fixed maturity securities, available for sale:
United States Government full faith and credit			$	37,471					$	2,300					$	—					$	—					$	39,771
United States Government sponsored agencies			995,465						44,132						(46)						—						1,039,551
United States municipalities, states and territories			3,236,767						543,252						(1,044)						(2,844)						3,776,131
Foreign government obligations			177,062						25,644						—						—						202,706
Corporate securities			26,745,196						4,507,716						(35,892)						(60,193)						31,156,827
Residential mortgage backed securities			1,399,956						117,135						(2,526)						(1,734)						1,512,831
Commercial mortgage backed securities			4,119,650						206,255						(64,678)						—						4,261,227
Other asset backed securities			5,593,169						103,320						(146,640)						—						5,549,849
			$	42,304,736					$	5,549,754					$	(250,826)					$	(64,771)					$	47,538,893
December 31, 2019
Fixed maturity securities, available for sale:
United States Government full faith and credit			$	161,492					$	369					$	(96)					$	—					$	161,765
United States Government sponsored agencies			601,672						28,133						(4,785)						—						625,020
United States municipalities, states and territories			4,147,343						388,578						(8,250)						—						4,527,671
Foreign government obligations			186,993						18,103						—						—						205,096
Corporate securities			29,822,172						2,796,926						(82,259)						—						32,536,839
Residential mortgage backed securities			1,477,738						101,617						(3,691)						—						1,575,664
Commercial mortgage backed securities			5,591,167						208,895						(13,783)						—						5,786,279
Other asset backed securities			6,250,369						90,978						(179,191)						—						6,162,156
			$	48,238,946					$	3,633,599					$	(292,055)					$	—					$	51,580,490

(1) Amortized cost excludes accrued interest receivable of $377.5 million as of December 31, 2020.
(2) Gross unrealized losses are net of allowance for credit losses.

Schedule of Fixed Maturity Securities by Contractual Maturity Date

The amortized cost and fair value of fixed maturity securities at December 31, 2020, by contractual maturity are shown below. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. All of our mortgage and other asset backed securities provide for periodic payments throughout their lives and are shown below as separate lines.

			Available for sale
			Amortized Cost						Fair Value
			(Dollars in thousands)
Due in one year or less			$	496,563					$	505,387
Due after one year through five years			7,229,621						7,718,178
Due after five years through ten years			8,167,106						9,166,066
Due after ten years through twenty years			9,254,579						11,396,733
Due after twenty years			6,044,092						7,428,622
			31,191,961						36,214,986
Residential mortgage backed securities			1,399,956						1,512,831
Commercial mortgage backed securities			4,119,650						4,261,227
Other asset backed securities			5,593,169						5,549,849
			$	42,304,736					$	47,538,893

Schedule of Components of Net Unrealized Gains on Available For Sale Fixed Maturity Securities Reported as Separate Component of Stockholders' Equity

Net unrealized gains on available for sale fixed maturity securities reported as a separate component of stockholders' equity were comprised of the following:

			December 31,
			2020						2019
			(Dollars in thousands)
Net unrealized gains on available for sale fixed maturity securities			$	5,297,040					$	3,341,544
Adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements			(2,250,520)						(1,473,966)
Deferred income tax valuation allowance reversal			22,534						22,534
Deferred income tax expense			(639,769)						(392,191)
Net unrealized gains reported as accumulated other comprehensive income			$	2,429,285					$	1,497,921

Schedule of Credit Quality of Fixed Maturity Security Portfolio by NAIC Designation

The following table summarizes the credit quality, as determined by NAIC designation, of our fixed maturity portfolio as of the dates indicated:

						December 31,
						2020												2019
NAIC Designation						Amortized Cost						Fair Value						Amortized Cost						Fair Value
						(Dollars in thousands)
1						$	23,330,149					$	26,564,542					$	27,781,525					$	30,122,657
2						17,312,485						19,377,013						19,278,355						20,316,911
3						1,292,124						1,299,455						1,001,087						977,191
4						282,049						256,651						114,497						112,534
5						29,396						16,288						57,952						45,205
6						58,533						24,944						5,530						5,992
						$	42,304,736					$	47,538,893					$	48,238,946					$	51,580,490

Schedule of Gross Unrealized Losses on Investments, By Category and Length of Time

The following table shows our investments' gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities (consisting of 843 and 1,033 securities, respectively) have been in a continuous unrealized loss position, at December 31, 2020 and 2019:

			Less than 12 months												12 months or more												Total
			Fair Value						Unrealized Losses (1)						Fair Value						Unrealized Losses (1)						Fair Value						Unrealized Losses (1)
			(Dollars in thousands)
December 31, 2020
Fixed maturity securities, available for sale:
United States Government sponsored agencies			$	250,475					$	(46)					$	—					$	—					$	250,475					$	(46)
United States municipalities, states and territories			31,802						(3,887)						868						(1)						32,670						(3,888)
Corporate securities:
Finance, insurance and real estate			109,789						(1,733)						—						—						109,789						(1,733)
Manufacturing, construction and mining			—						—						19,335						(1,384)						19,335						(1,384)
Utilities and related sectors			310,823						(27,509)						35,408						(3,628)						346,231						(31,137)
Wholesale/retail trade			65,567						(4,344)						16,000						(26)						81,567						(4,370)
Services, media and other			120,098						(11,564)						83,890						(45,897)						203,988						(57,461)
Residential mortgage backed securities			156,016						(2,384)						13,599						(1,876)						169,615						(4,260)
Commercial mortgage backed securities			934,593						(54,834)						35,153						(9,844)						969,746						(64,678)
Other asset backed securities			1,013,781						(16,607)						2,567,723						(130,033)						3,581,504						(146,640)
			$	2,992,944					$	(122,908)					$	2,771,976					$	(192,689)					$	5,764,920					$	(315,597)
December 31, 2019
Fixed maturity securities, available for sale:
United States Government full faith and credit			$	144,582					$	(96)					$	—					$	—					$	144,582					$	(96)
United States Government sponsored agencies			168,732						(1,229)						201,444						(3,556)						370,176						(4,785)
United States municipalities, states and territories			285,481						(8,173)						3,081						(77)						288,562						(8,250)
Corporate securities:
Finance, insurance and real estate			267,521						(4,785)						121,993						(4,744)						389,514						(9,529)
Manufacturing, construction and mining			161,633						(6,039)						44,606						(3,951)						206,239						(9,990)
Utilities and related sectors			334,635						(7,730)						51,269						(3,482)						385,904						(11,212)
Wholesale/retail trade			54,289						(1,751)						129,364						(9,411)						183,653						(11,162)
Services, media and other			275,135						(6,135)						316,086						(34,231)						591,221						(40,366)
Residential mortgage backed securities			212,404						(2,686)						11,332						(1,005)						223,736						(3,691)
Commercial mortgage backed securities			602,394						(9,366)						194,328						(4,417)						796,722						(13,783)
Other asset backed securities			752,413						(11,709)						3,375,016						(167,482)						4,127,429						(179,191)
			$	3,259,219					$	(59,699)					$	4,448,519					$	(232,356)					$	7,707,738					$	(292,055)

(1) Unrealized losses have not been reduced to reflect the allowance for credit losses of $64.8 million as of December 31, 2020.

Schedule of Changes in Net Unrealized Gains/Losses on Investments

Changes in net unrealized gains/losses on investments for the years ended December 31, 2020, 2019 and 2018 are as follows:

			Year Ended December 31,
			2020						2019						2018
			(Dollars in thousands)
Fixed maturity securities held for investment carried at amortized cost			$	—					$	—					$	581
Fixed maturity securities available for sale carried at fair value			$	1,955,496					$	3,549,007					$	(2,463,693)
Adjustment for effect on other balance sheet accounts:
Deferred policy acquisition costs and deferred sales inducements			(776,554)						(1,586,537)						1,318,649
Deferred income tax asset/liability			(247,578)						(412,117)						240,459
			(1,024,132)						(1,998,654)						1,559,108
Change in net unrealized gains/losses on investments carried at fair value			$	931,364					$	1,550,353					$	(904,585)

Components of Net Investment Income

Components of net investment income are as follows:

			Year Ended December 31,
			2020						2019						2018
			(Dollars in thousands)
Fixed maturity securities			$	2,035,762					$	2,171,768					$	2,027,599
Equity securities			1,090						4,083						4,735
Mortgage loans on real estate			170,749						145,344						131,259
Cash and cash equivalents			4,871						5,164						2,320
Other			2,078						3,119						1,548
			2,214,550						2,329,478						2,167,461
Less investment expenses			(32,472)						(21,843)						(19,649)
Net investment income			$	2,182,078					$	2,307,635					$	2,147,812

Net Realized Gains (Losses) on Investments

Net realized gains (losses) on investments for the years ended December 31, 2020, 2019 and 2018 are as follows:

			Year Ended December 31,
			2020						2019						2018
			(Dollars in thousands)
Available for sale fixed maturity securities:
Gross realized gains			$	305,170					$	21,449					$	12,245
Gross realized losses			(276,847)						(6,397)						(47,974)
Credit losses (1)			(94,560)						—						—
			(66,237)						15,052						(35,729)
Other investments:
Gross realized gains			—						7,296						—
Gross realized losses			—						(14,446)						—
			—						(7,150)						—
Mortgage loans on real estate:
Increase in allowance for credit losses			(15,447)						(940)						(3,165)
Recovery of specific allowance			712						—						1,592
Gain on sale of mortgage loans			292						—						124
			(14,443)						(940)						(1,449)
			$	(80,680)					$	6,962					$	(37,178)

(1) Prior to adopting authoritative guidance effective January 1, 2020, credit losses on available for sale fixed maturity securities were classified as other than temporary impairments and reported in a separate line item in the Consolidated statements of operations. We recognized $18.7 million and $36.7 million, respectively, of other than temporary impairments during the years ended December 31, 2019 and 2018.

Non-Income Producing Investments

The following table summarizes the carrying value of our investments that have been non-income producing for 12 consecutive months:

			December 31,
			2020						2019
			(Dollars in thousands)
Fixed maturity securities, available for sale			$	5,766					$	5,792

Rollforward of Allowance for Credit Loss

The following table provides a rollforward of the allowance for credit loss:

			Year Ended December 31, 2020
			United States Municipalities, States and Territories						Corporate Securities						Commercial Mortgage Backed Securities						Residential Mortgage Backed Securities						Other Asset Backed Securities						Total
			(Dollars in thousands)
Beginning balance (1)			$	—					$	—					$	—					$	—					$	—					$	—
Additions for credit losses not previously recorded			2,844						60,193						29,241						1,734						548						94,560
Reduction for securities with credit losses due to intent to sell			—						—						(21,888)						—						(548)						(22,436)
Reduction for securities sold during the period			—						—						(7,353)						—						—						(7,353)
Ending balance			$	2,844					$	60,193					$	—					$	1,734					$	—					$	64,771

(1) The allowance for credit loss associated with available for sale fixed maturity securities was applied prospectively upon adoption of authoritative guidance effective January 1, 2020. See Note 1 - Significant Accounting Policies for further details.

Other Than Temporary Impairment, Credit Losses Recognized in Earnings

The cumulative portion of other than temporary impairments determined to be credit losses which have been recognized in operations for debt securities are summarized as follows:

									Year Ended December 31,
									2019
									(Dollars in thousands)
Cumulative credit loss at beginning of year									$	(175,398)
Additions for the amount related to credit losses for which OTTI has not previously been recognized									(18,271)
Additional credit losses on securities for which OTTI has previously been recognized									(455)
Accumulated losses on securities that were disposed of during the period									24,422
Cumulative credit loss at end of year									$	(169,702)

Schedule of Other Than Temporary Impairment Losses, Investments

The following table summarizes the cumulative noncredit portion of OTTI and the change in fair value since recognition of OTTI, both of which were recognized in other comprehensive income, by major type of security, for securities that are part of our investment portfolio at December 31, 2019:

			Amortized Cost						OTTI Recognized in Other Comprehensive Income (Loss)						Change in Fair Value Since OTTI was Recognized						Fair Value
			(Dollars in thousands)
December 31, 2019
Fixed maturity securities, available for sale:
Corporate securities			$	50,755					$	(3,700)					$	9,268					$	56,323
Residential mortgage backed securities			183,948						(145,446)						172,577						211,079
Commercial mortgage backed securities			12,776						—						(401)						12,375
Other asset backed securities			977						—						261						1,238
			$	248,456					$	(149,146)					$	181,705					$	281,015

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