Investments

3 Months Ended

Mar. 31, 2023

Investments, Debt and Equity Securities [Abstract]

Investments

InvestmentsIncluded in our Assets held-for-sale at December 31, 2022 in our Consolidated Balance Sheets is $55.9 million of assets managed on behalf of the trade capital providers, who are third-party participants that provide underwriting capital to the operations of Syndicates 1200 and 1910. At March 31, 2023, the Company did not have any assets managed on behalf of the trade capital providers due the sale of AUA as described in Note 1, “Business and Significant Accounting Policies

Fixed Maturities

The amortized cost, gross unrealized gains, gross unrealized losses, allowance for credit losses, and fair value of fixed maturity investments were as follows:

March 31, 2023
(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
Fixed maturities
U.S. Governments	$	412.5	$	—	$	24.6	$	—	$	387.9
Foreign Governments	35.8		0.4		7.2		0.8		28.2
Obligations of states and political subdivisions	109.0		0.6		8.3		0.4		100.9
Corporate bonds	1,360.5		1.1		140.7		1.4		1,219.5
Commercial mortgage-backed securities	335.2		—		50.4		—		284.8
Residential mortgage-backed securities	314.1		0.2		46.1		—		268.2
Asset-backed securities	149.3		—		12.1		0.1		137.1
Collateralized loan obligations	253.4		0.4		16.0		—		237.8
Total fixed maturities	$	2,969.8	$	2.7	$	305.4	$	2.7	$	2,664.4

December 31, 2022
(in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Allowance for Credit Losses		Fair Value
Fixed maturities
U.S. Governments	$	410.9	$	—	$	30.2	$	—	$	380.7
Foreign Governments	35.6		0.3		6.7		0.8		28.4
Obligations of states and political subdivisions	109.9		0.4		10.1		0.4		99.8
Corporate bonds	1,394.8		0.9		160.0		1.6		1,234.1
Commercial mortgage-backed securities	337.4		—		52.0		—		285.4
Residential mortgage-backed securities	320.0		0.2		50.2		—		270.0
Asset-backed securities	153.4		—		14.2		—		139.2
Collateralized loan obligations	254.4		0.3		16.8		—		237.9
Total fixed maturities	$	3,016.4	$	2.1	$	340.2	$	2.8	$	2,675.5

Contractual Maturity

The amortized cost and fair values of fixed maturity investments as of March 31, 2023, by contractual maturity, were as follows:

(in millions)	Amortized Cost		Fair Value
Due in one year or less	$	84.1	$	83.0
Due after one year through five years	1,276.3		1,179.1
Due after five years through ten years	509.4		435.5
Due after ten years	48.0		38.9
Structured securities	1,052.0		927.9
Total	$	2,969.8	$	2,664.4

The actual maturities may differ from the contractual maturities because debtors may have the right to call or prepay obligations.

Other Investments

Details regarding the carrying value and unfunded investment commitments of other investments as of March 31, 2023 and December 31, 2022 were as follows:

March 31, 2023
(in millions)	Carrying Value		Unfunded Commitments
Investment Type
Hedge funds	$	54.7	$	—
Private equity	263.7		107.3
Other	4.6		—
Total other investments	$	323.0	$	107.3

December 31, 2022
(in millions)	Carrying Value		Unfunded Commitments
Investment Type
Hedge funds	$	54.0	$	—
Private equity	264.6		108.9
Other	4.6		—
Total other investments	$	323.2	$	108.9

The following describes each investment type:

•Hedge funds: Hedge funds, carried at net asset value (“NAV”) as a practical expedient of fair value, include funds that primarily buy and sell stocks, including short sales, multi-strategy credit, relative value credit and distressed credit.

•Private equity: Private equity includes buyout funds, real asset/infrastructure funds, credit special situations funds, mezzanine lending funds and direct investments and strategic non-controlling minority investments in private companies that are principally accounted for using the equity method of accounting.

•Other: Other includes participation in investment pools.

Unrealized Losses

An aging of unrealized losses on our investments in fixed maturities is presented below:

March 31, 2023	Less Than One Year				One Year or Greater				Total
(in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed maturities
U.S. Governments	$	17.3	$	0.4	$	370.1	$	24.2	$	387.4	$	24.6
Foreign Governments	13.1		2.4		7.3		4.8		20.4		7.2
Obligations of states and political subdivisions	23.3		1.0		66.4		7.3		89.7		8.3
Corporate bonds	169.9		11.1		1,027.8		129.6		1,197.7		140.7
Commercial mortgage-backed securities	29.1		2.6		255.6		47.8		284.7		50.4
Residential mortgage-backed securities	26.9		1.5		238.7		44.6		265.6		46.1
Asset-backed securities	43.8		1.9		93.1		10.2		136.9		12.1
Collateralized loan obligations	48.4		2.8		177.0		13.2		225.4		16.0
Total fixed maturities	$	371.8	$	23.7	$	2,236.0	$	281.7	$	2,607.8	$	305.4

December 31, 2022	Less Than One Year				One Year or Greater				Total
(in millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed maturities
U.S. Governments	$	271.0	$	18.1	$	109.8	$	12.1	$	380.8	$	30.2
Foreign Governments	16.7		4.9		2.6		1.8		19.3		6.7
Obligations of states and political subdivisions	67.4		4.1		24.3		6.0		91.7		10.1
Corporate bonds	695.1		68.3		519.6		91.7		1,214.7		160.0
Commercial mortgage-backed securities	144.2		18.6		141.2		33.4		285.4		52.0
Residential mortgage-backed securities	88.7		8.8		178.8		41.4		267.5		50.2
Asset-backed securities	93.3		7.5		45.9		6.7		139.2		14.2
Collateralized loan obligations	181.1		13.3		44.2		3.5		225.3		16.8
Total fixed maturities	$	1,557.5	$	143.6	$	1,066.4	$	196.6	$	2,623.9	$	340.2

We hold a total of 1,548 fixed maturity securities, of which 479 were in an unrealized loss position for less than one year and 1,045 were in an unrealized loss position for a period one year or greater as of March 31, 2023. The unrealized losses as of March 31, 2023 are primarily driven from interest rate movements.

Allowance for Credit Losses

For fixed maturities with a decline in fair value below the amortized cost due to credit-related factors, an allowance is established for the difference between the estimated recoverable value and amortized cost with a corresponding charge to Net investment and other gains (losses) in the Condensed Consolidated Statements of Income (Loss). The allowance is limited to the difference between amortized cost and fair value. The estimated recoverable value is the present value of cash flows expected to be collected, as determined by management. The difference between fair value and amortized cost that is not associated with credit-related factors is recognized in the Condensed Consolidated Statements of Comprehensive Income (Loss). Accrued interest is excluded from the measurement of the allowance for credit losses.

When determining if a credit loss has been incurred, we may consider the historical performance of the security, available market information and security specific considerations such as the priority payment of the security. In addition, inputs used in our analysis include, but are not limited to, credit ratings and downgrades, delinquency rates, missed scheduled interest or principal payments, purchase yields, underlying asset performance, collateral types, modeled default rates, modeled severity rates, call/prepayment rates, expected cash flows, industry concentrations, and potential or filed bankruptcies or restructurings.

In cooperation with our investment managers, we evaluate for credit losses each quarter utilizing a bottom up review approach. At the security level, a determination is made as to whether a decline in fair value below the amortized cost basis is due to credit-related or noncredit-related factors. If we determine that all or a portion of a fixed maturity is uncollectible, the uncollectible amortized cost is written off with a corresponding reduction to the allowance for credit losses. If we collect cash flows that were previously written off, the recovery is recognized in realized investment gains. We also consider whether we intend to sell an available-for-sale security or if it is more likely than not that we will be required to sell the security before recovery of its amortized cost. In these instances, a decline in fair value is recognized in Net investment and other gains (losses) in the Condensed Consolidated Statements of Income (Loss) based on the fair value of the security at the time of assessment, resulting in a new cost basis for the security.

The following table presents a roll-forward of the changes in allowance for credit losses on available-for-sale fixed maturities by industry category for the three months ending March 31, 2023 and 2022, respectively:

(in millions)	Foreign Governments		Obligations of states and political subdivisions		Corporate bonds		Asset backed securities		Total
Beginning balance, January 1, 2023	$	0.7	$	0.4	$	1.6	$	0.1	$	2.8
Securities for which allowance was not previously recorded	—		—		0.2		—		0.2
Securities sold during the period	—		—		(0.3)		—		(0.3)
Reductions for credit impairments	—		—		—		—		—
Additional net increases (decreases) in existing allowance	0.1		—		(0.1)		—		—
Ending balance, March 31, 2023	$	0.8	$	0.4	$	1.4	$	0.1	$	2.7

(in millions)	Foreign Governments		Obligations of states and political subdivisions		Corporate bonds		Asset backed securities		Total
Beginning balance, January 1, 2022	$	0.2	$	—	$	2.2	$	0.1	$	2.5
Securities for which allowance was not previously recorded	0.1		—		0.4		—		0.5
Securities sold during the period	—		—		(0.6)		—		(0.6)
Additional net increases (decreases) in existing allowance	—		0.4		0.1		—		0.5
Ending balance, March 31, 2022	$	0.3	$	0.4	$	2.1	$	0.1	$	2.9

Total credit impairment (gains) losses, net of allowance for credit losses, included in Net investment and other gains (losses) in the Condensed Consolidated Statements of Income (Loss) was $0.1 million and $1.0 million for the three months ended March 31, 2023, and 2022 respectively.

For commercial mortgage loans an allowance for credit losses is established at the time of origination or purchase, as necessary, and is updated each reporting period. Changes in the allowance for credit losses are recorded in Net investment and other gains (losses). This allowance reflects the risk of loss, even when that risk is remote, that is expected over the remaining contractual life of the loan. The allowance for credit losses considers available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable forecasts of future economic conditions.

Commercial Mortgage Loans

Commercial mortgage loan investments are composed of participation interests in a portfolio of commercial mortgage loans. Loan collateral is diversified with regard to property type and geography. The following table presents loans by property type:

	March 31, 2023
(in millions)	Cost		Composition		Loan Count
Apartments	$	87.4	54.7	%	16
Hotel	25.0		15.6	%	4
Industrial	26.0		16.3	%	4
Retail	21.5		13.4	%	4
Total	$	159.9	100.0	%	28

	December 31, 2022
(in millions)	Cost		Composition		Loan Count
Apartments	$	87.4	54.5	%	16
Hotel	25.0		15.6	%	4
Industrial	26.0		16.3	%	4
Retail	21.5		13.6	%	4
Total	$	159.9	100.0	%	28

The following table presents our loans by Debt Service Coverage Ratio (“DSCR”):

	March 31, 2023
(in millions)	Cost		Loan Count
1.00 to 1.50	$	30.4	6
Greater than 1.5 to 2.0	71.7		12
Greater than 2.0 to 3.0	32.0		6
Greater than 3.0 to 4.0	25.8		4
Greater than 4.0	0.0		0
Total	$	159.9	28

	December 31, 2022
(in millions)	Cost		Loan Count
1.00 to 1.50	$	10.4	2
Greater than 1.5 to 2.0	60.4		10
Greater than 2.0 to 3.0	52.0		10
Greater than 3.0 to 4.0	25.8		4
Greater than 4.0	11.3		2
Total	$	159.9	28

The following table presents loans by Loan To Value (“LTV”):

	March 31, 2023
(in millions)	Cost		Loan Count
Equal to or less than 50.0%	$	36.7	6
Greater than 50.0% to 55.0%	9.1		2
Greater than 55.0% to 60.0%	42.6		8
Greater than 60.0% to 70.0%	61.5		10
Greater than 70.0%	10.0		2
Total	$	159.9	28

	December 31, 2022
(in millions)	Cost		Loan Count
Equal to or less than 50.0%	$	36.7	6
Greater than 50.0% to 55.0%	9.1		2
Greater than 55.0% to 60.0%	42.6		8
Greater than 60.0% to 70.0%	71.5		12
Total	$	159.9	28

The following table presents loans by maturity:

	March 31, 2023
(in millions)	Cost		Loan Count
One Year or Less	$	10.0	2
Greater than One Year and Less than Three	44.8		8
Greater than Three Years and Less than Five Years	33.8		6
Greater than Five Years and Less than Seven Years	20.4		4
Greater than Seven Years and Less than Ten Years	50.9		8
Total	$	159.9	28

	December 31, 2022
(in millions)	Cost		Loan Count
Greater than One Year and Less than Three	$	54.8	10
Greater than Three Years and Less than Five Years	33.8		6
Greater than Five Years and Less than Seven Years	20.4		4
Greater than Seven Years and Less than Ten Years	50.9		8
Total	$	159.9	28

Investment Gains and Losses

The following table presents our gross realized investment gains and losses:

	For the Three Months Ended March 31,
(in millions)	2023		2022
Realized gains on fixed maturities and other:
Fixed maturities	$	0.2	$	11.2
Other investments, including short-term investments	7.8		1.5
Other assets	—		—
Total realized gains on fixed maturities and other	8.0		12.7
Realized losses on fixed maturities and other:
Fixed maturities	(22.4)		(16.6)
Other investments, including short-term investments	(5.8)		(6.8)
Other assets	—		—
Total realized losses on fixed maturities and other	(28.2)		(23.4)
Other net losses recognized on fixed maturities and other:
Credit losses on fixed maturities	(0.6)		(1.0)
Impairment related to change in intent	—		—
Other(1)	(3.6)		(28.5)
Total other net losses recognized on fixed maturities and other	(4.2)		(29.5)
Equity securities:
Net realized gains (losses) on equity securities	0.3		(1.0)
Change in unrealized gains (losses) on equity securities held at the end of the period	6.2		6.7
Net gains (losses) on equity securities	6.5		5.7
Net investment and other gains (losses) before income taxes	(17.9)		(34.5)
Income tax (benefit) provision	(5.1)		(0.7)
Net investment and other gains (losses), net of income taxes	$	(12.8)	$	(33.8)

(1) For the three months ended March 31, 2022, refer to the sale Argo Seguros in Note 1, “Business and Significant Accounting Policies” for additional information.

The cost of securities sold is based on the specific identification method.

Changes in unrealized gains (losses) related to fixed maturity investments are summarized as follows:

	For the Three Months Ended March 31,
(in millions)	2023		2022
Change in unrealized gains (losses)
Fixed maturities	$	55.5	$	(177.9)
Other and short-term investments	(0.1)		0.1
Net unrealized investment gains (losses) before income taxes	55.4		(177.8)
Income tax provision (benefit)	9.9		(33.9)
Net unrealized investment gains (losses), net of income taxes	$	45.5	$	(143.9)

Foreign Currency Exchange Forward Contracts

We enter into foreign currency exchange forward contracts to manage operational currency exposure from our non-USD insurance operations, and to hedge certain non-USD investment portfolio securities. The currency forward contracts are carried at fair value in our Condensed Consolidated Balance Sheets in Other liabilities and Other assets at March 31, 2023 and December 31, 2022, respectively. The net realized gains and (losses) are included in Net realized investment and other gains (losses) in our Condensed Consolidated Statements of Income (Loss).

The fair value of our foreign currency exchange forward contracts as of March 31, 2023 and December 31, 2022 was as follows:

	March 31, 2023				December 31, 2022
(in millions)	Notional Amount		Fair Value		Notional Amount		Fair Value
Operational currency exposure	$	125.7	$	1.7	$	148.2	$	5.8
Asset manager investment exposure	42.1		(0.9)		135.0		(0.6)
Total	$	167.8	$	0.8	$	283.2	$	5.2

The following table represents our gross realized investment gains and losses on our foreign currency exchange forward contracts:

	For the Three Months Ended March 31,
(in millions)	2023		2022
Realized gains
Operational currency exposure	$	4.1	$	2.5
Asset manager investment exposure	—		1.1
Gross realized investment gains	$	4.1	3.6
Realized losses
Operational currency exposure	(3.1)		(8.8)
Asset manager investment exposure	(0.3)		—
Gross realized investment losses	(3.4)		(8.8)
Net realized investment (losses) gains on foreign currency exchange forward contracts	$	0.7	$	(5.2)

Regulatory Deposits, Pledged Securities and Letters of Credit

We are required to maintain assets on deposit with various regulatory authorities to support our insurance and reinsurance operations. We maintain assets pledged as collateral in support of irrevocable letters of credit issued under the terms of certain reinsurance agreements for reported loss and loss expense reserves. The following table presents our components of restricted assets:

(in millions)	March 31, 2023		December 31, 2022
Securities on deposit for regulatory and other purposes	$	142.8	$	149.3
Securities pledged as collateral for letters of credit and other	120.9		169.8
Securities on deposit supporting Lloyd’s business (1)	173.9		171.4
Total restricted investments	$	437.6	$	490.5

(1) Argo Group is required to maintain Funds at Lloyd’s (“FAL”) to support its business for Syndicate 1200 and Syndicate 1910. At March 31, 2023 the amount of securities pledged for FAL was $173.9 million, which was provided by Argo Re, Ltd. The Company expects the FAL to be released in the second quarter of 2023, due to the sale of AUA, subject to regulatory approval. Refer to the sale of AUA in Note 1, “Business and Significant Accounting Policies” for additional information.

Fair Value Measurements

Fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability, or in the absence of a principal market, the most advantageous market. Market participants are buyers and sellers in the principal (or most advantageous) market that are independent, knowledgeable, able to transact for the asset or liability and willing to transfer the asset or liability.

Valuation techniques consistent with the market approach, income approach and/or cost approach are used to measure fair value. The inputs of these valuation techniques are categorized into three levels.

•Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that can be accessed at the reporting date. We define actively traded as a security that has traded in the past seven days.

•Level 2 inputs are inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. We receive one quote per instrument for Level 2 inputs.

•Level 3 inputs are unobservable inputs. Unobservable inputs reflect our own judgments about the assumptions market participants would use in pricing the asset or liability based on the best information available in the circumstances.

To validate the fair value of investments in the Company’s financial statements, we receive prices from multiple sources including third-party pricing services and our outside investment managers. Through a comparative analysis, the Company validates the reasonableness of its valuations. These prices are determined using observable market information such as dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things. We have reviewed the processes used by the third-party providers for pricing the securities and have determined that these processes result in fair values consistent with GAAP requirements. In addition, we review these prices for reasonableness, and have not adjusted any prices received from the third-party providers as of March 31, 2023 and December 31, 2022. A description of the valuation techniques we use to measure assets at fair value is as follows:

Fixed Maturities (Available-for-Sale) Levels 1 and 2:

•United States Treasury securities are typically valued using Level 1 inputs. For these securities, we obtain fair value measurements from third-party pricing services using quoted prices (unadjusted) in active markets at the reporting date.

•United States Government agencies, non-U.S. Government securities, obligations of states and political subdivisions, credit securities and foreign denominated government and credit securities are reported at fair value using Level 2 inputs. For these securities, we obtain fair value measurements from third-party pricing services. Observable data may include dealer quotes, market spreads, yield curves, live trading levels, trade execution data, credit information and the security’s terms and conditions, among other things.

•Asset and mortgage-backed securities and collateralized loan obligations are reported at fair value using Level 2 inputs. For these securities, we obtain fair value measurements from third-party pricing services. Observable data may include dealer quotes, market spreads, cash flows, yield curves, live trading levels, trade execution data, market consensus prepayment speeds, credit information and the security’s terms and conditions, among other things.

Fixed Maturities (Available-for-Sale) Levels 3: We own term loans and asset-back securities that are valued using unobservable inputs.

Equity Securities Level 1: Equity securities are principally reported at fair value using Level 1 inputs. For these securities, we obtain fair value measurements from a third-party pricing service using quoted prices (unadjusted) in active markets at the reporting date.

Equity Securities Level 3: We own certain equity securities that are reported at fair value using Level 3 inputs. The valuation techniques for these securities include the following:

•Fair value measurements for an investment in an equity fund obtained by applying final prices provided by the administrator of the fund, which is based upon certain estimates and assumptions.

•Fair value measurements from brokers and independent valuation services, both based upon estimates, assumptions and other unobservable inputs.

Other Investments Level 2: Foreign regulatory deposits are assets held in trust in jurisdictions where there is a legal and regulatory requirement to maintain funds locally in order to protect policyholders. Lloyd’s is the appointed investment manager for the funds. These assets are invested in short-term government securities, agency securities and corporate bonds and are valued using Level 2 inputs based upon values obtained from Lloyd’s.

Short-term Investments: Short-term investments are principally reported at fair value using Level 1 inputs, with the exception of short-term corporate and governmental bonds reported at fair value using Level 2 inputs as described in the fixed maturities section above. Values for the investments categorized as Level 1 are obtained from various financial institutions as of the reporting date.

Based on an analysis of the inputs, our financial assets and liabilities measured at fair value on a recurring basis have been categorized as follows:

			Fair Value Measurements at Reporting Date Using
(in millions)	March 31, 2023		Level 1 (1)		Level 2 (2)		Level 3 (3)
Fixed maturities
U.S. Governments	$	387.9	$	385.8	$	2.1	$	—
Foreign Governments	28.2		—		28.2		—
Obligations of states and political subdivisions	100.9		—		100.9		—
Corporate bonds	1,219.5		—		1,197.5		22.0
Commercial mortgage-backed securities	284.8		—		284.8		—
Residential mortgage-backed securities	268.2		—		268.2		—
Asset-backed securities	137.1		—		118.9		18.2
Collateralized loan obligations	237.8		—		237.8		—
Total fixed maturities	2,664.4		385.8		2,238.4		40.2
Equity securities	44.2		36.0		—		8.2
Other investments	0.3		—		0.3		—
Short-term investments	694.6		694.3		0.3		—
Derivatives	0.8		—		0.8		—
Total assets	$	3,404.3	$	1,116.1	$	2,239.8	$	48.4

(1) Quoted prices in active markets for identical assets

(2) Significant other observable inputs

(3) Significant unobservable inputs

			Fair Value Measurements at Reporting Date Using
(in millions)	December 31, 2022		Level 1 (1)		Level 2 (2)		Level 3 (3)
Fixed maturities
U.S. Governments	$	380.7	$	378.7	$	2.0	$	—
Foreign Governments	28.4		—		28.4		—
Obligations of states and political subdivisions	99.8		—		99.8		—
Corporate bonds	1,234.1		—		1,212.1		22.0
Commercial mortgage-backed securities	285.4		—		285.4		—
Residential mortgage-backed securities	270.0		—		270.0		—
Asset-backed securities	139.2		—		120.5		18.7
Collateralized loan obligations	237.9		—		237.9		—
Total fixed maturities	2,675.5		378.7		2,256.1		40.7
Equity securities	43.9		28.4		—		15.5
Other investments	0.3		—		0.3		—
Short-term investments	449.6		449.3		0.3		—
Derivatives	5.2		—		5.2		—
Total assets	$	3,174.5	$	856.4	$	2,261.9	$	56.2

(1) Quoted prices in active markets for identical assets

(2) Significant other observable inputs

(3) Significant unobservable inputs

The fair value measurements in the tables above do not equal Total investments on our Consolidated Balance Sheets as they primarily exclude other investments that are accounted for under the equity-method of accounting as well as hedge funds which are carried at NAV as a practical expedient.

A reconciliation of the beginning and ending balances for the investments categorized as Level 3 are as follows:

Fair Value Measurements Using Unobservable Inputs (Level 3)

(in millions)	Credit Financial		Equity Securities		Total
Beginning balance, January 1, 2023	$	40.7	$	15.5	$	56.2
Transfers into Level 3	—		—		—
Transfers out of Level 3	—		(7.6)		(7.6)
Total gains or losses (realized/unrealized):
Included in net income	—		0.3		0.3
Included in other comprehensive income	—		—		—
Purchases, issuances, sales, and settlements:
Purchases	—		—		—
Issuances	—		—		—
Sales	—		—		—
Settlements	(0.5)		—		(0.5)
Ending balance, March 31, 2023	$	40.2	$	8.2	$	48.4
Amount of total gains or losses for the year included in net income attributable to the change in unrealized gains or losses relating to assets still held at March 31, 2023	$	—	$	—	$	—

(in millions)	Credit Financial		Equity Securities		Total
Beginning balance, January 1, 2022	$	2.8	$	14.7	$	17.5
Transfers into Level 3	36.1		1.5		37.6
Transfers out of Level 3	—		—		—
Total gains or losses (realized/unrealized):
Included in net income	(0.4)		(0.7)		(1.1)
Included in other comprehensive loss	(4.8)		—		(4.8)
Purchases, issuances, sales, and settlements:
Purchases	9.0		1.0		10.0
Issuances	—		—		—
Sales	(2.0)		(1.0)		(3.0)
Settlements	—		—		—
Ending balance, December 31, 2022	$	40.7	$	15.5	$	56.2
Amount of total gains or losses for the year included in net income attributable to the change in unrealized gains or losses relating to assets still held at December 31, 2022	$	—	$	(4.4)	$	(4.4)

At March 31, 2023 and December 31, 2022, we did not have any financial assets or financial liabilities measured at fair value on a nonrecurring basis or any financial liabilities on a recurring basis.

The Company holds investments in commercial mortgage loans reported at cost, less an allowance for expected credit losses, on the Balance Sheet. The cost and estimated fair value of the investments in commercial mortgage loans were:

	March 31, 2023				December 31, 2022
(in millions)	Cost		Fair Value		Cost		Fair Value
Commercial mortgage loans	$	159.9	$	152.3	$	159.9	$	150.7