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Goodwill
 12 Months Ended
Dec. 31, 2019
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill Goodwill 
The Company has assigned goodwill to its reporting units for impairment testing purposes. The Corporate and Other segment is not assigned any goodwill. In 2018, we determined that it was no longer appropriate to aggregate our reporting units within our Global Lifestyle operating segment due to further differentiation of certain components of underlying products, including the economics and distribution, as a result of our acquisition of TWG and the related changes in segment leadership. As a result, the Global Lifestyle reporting unit was disaggregated into the following three reporting units: Connected Living, Global Automotive and Global Financial Services and Other. The carrying amount of our Global Lifestyle legacy goodwill was allocated based on the fair value of the three new reporting units. The carrying amount of our goodwill from the TWG acquisition was allocated to the three new reporting units based on the acquisition multiple and implied forward earnings contribution of each reporting unit. For Global Housing and Global Preneed, the reporting unit for impairment testing was at the operating segment level. There were no changes to reporting units in 2019.
Qualitative Impairment Testing
In the fourth quarter of 2019, the Company performed a qualitative assessment for each of its Connected Living, Global Housing and Global Preneed reporting units due to high margins between fair value and book value based on quantitative analysis in 2018 and increased growth based on past performance and future plans. In conducting a qualitative assessment, the Company analyzed actual and projected growth trends for revenues and profit for each reporting unit, as well as historical performance versus plan and the results of prior quantitative tests performed. Additionally, the Company assessed critical areas that may impact its business, including macroeconomic conditions and the related impact, any plans to market for sale all or a portion of their business, competitive changes, or any potential risks to their projected financial results. Based on this
assessment, the Company determined that it was more likely than not that the reporting units’ fair values were more than their respective carrying amounts and therefore quantitative impairment testing was not necessary for these reporting units.
Quantitative Impairment Testing
The Company performed quantitative tests on its Global Automotive and Global Financial Services and Other reporting units due to declining growth in profits and reduced margins between fair value and book value based on quantitative impairment testing performed in the prior year.
The following describes the various valuation methodologies used in the quantitative test which were weighted using our judgment as to which were the most representative in determining the estimated fair value of our reporting units.
A Dividend Discount Method (“DDM”) was used to value each of the two reporting units based upon the present value of expected cash flows available for distribution over future periods. Cash flows were estimated for a discrete projection period based on detailed assumptions, and a terminal value was calculated to reflect the value attributable to cash flows beyond the discrete period. Cash flows and the terminal value were then discounted using the reporting unit’s estimated cost of capital. The estimated fair value of the reporting unit represented the sum of the discounted cash flows and terminal value.
A Guideline Company Method, in which we identified a group of peer companies that have similar operations to the reporting unit, was used; however, direct peer comparisons for our reporting units were limited. This method was used to value each reporting unit based upon its relative performance to peer companies, based on several measures, including price to trailing 12 month earnings, price to projected earnings, price to tangible net worth and return on equity.
A Guideline Transaction Method was used to value each reporting unit based on available data concerning the purchase prices paid in acquisitions of similar companies operating in the insurance industry. The application of certain financial multiples calculated from these transactions provided an indication of estimated fair value of the reporting units.
While all three valuation methodologies were considered in assessing fair value, the DDM was weighed more heavily since management believes that expected cash flows are the most important factor in the valuation of a business enterprise. Based on the quantitative assessment, the Company concluded that the estimated fair values exceeded their respective book values and therefore determined that goodwill was not impaired for these reporting units.
A roll forward of goodwill by reportable segment is provided below as of and for the years indicated:
 
Global Lifestyle (1)
 
Global Housing
 
Global Preneed
 
Consolidated
Balance at December 31, 2017 (2)
$
392.8

 
$
386.7

 
$
138.2

 
$
917.7

Acquisitions (3)
1,421.1

 
—

 
—

 
1,421.1

Impairments (4)
—

 
(7.2
)
 
—

 
(7.2
)
Foreign currency translation and other
(9.2
)
 
—

 
(0.6
)
 
(9.8
)
Balance at December 31, 2018 (2)
1,804.7

 
379.5

 
137.6

 
2,321.8

Acquisitions (3)
20.2

 
—

 
—

 
20.2

Foreign currency translation and other
1.0

 
—

 
0.4

 
1.4

Balance at December 31, 2019 (2)
$
1,825.9

 
$
379.5

 
$
138.0

 
$
2,343.4


(1)
As of December 31, 2019, $461.5 million, $1,291.7 million and $72.7 million of goodwill was assigned to the Connected Living, Global Automotive and Global Financial Services and Other reporting unit, respectively. As of December 31, 2018, $451.2 million, $1,281.3 million and $72.2 million of goodwill was assigned to the Connected Living, Global Automotive and Global Financial Services and Other reporting unit, respectively
(2)
Consolidated goodwill reflects $1,268.1 million of accumulated impairment loss at December 31, 2019 and 2018, and $1,260.9 million of accumulated impairment losses at December 31, 2017.
(3)
Includes goodwill from the TWG acquisition (including the application of measurement period adjustments). Refer to Note 3 for additional information.
(4)
Refer to Note 4 for additional information on the impairment loss on the Mortgage Solutions business.