Reinsurance (Tables)

9 Months Ended

Sep. 30, 2020

Details on in force life insurance were as follows:

	September 30, 2020			December 31, 2019
	(Dollars in thousands)
Direct life insurance in force	$	842,842,940		$	810,995,295
Amounts ceded to other companies		(728,453,611	)		(702,727,956	)
Net life insurance in force	$	114,389,329		$	108,267,339
Percentage of reinsured life insurance in force		86	%		87	%

Reinsurance Recoverables and Financial Strength Ratings by Reinsurer

Reinsurance recoverables as of September 30, 2020 and December 31, 2019 include ceded reserve balances, ceded claim liabilities, and ceded claims paid. Reinsurance recoverables and financial strength ratings by reinsurer were as follows:

	September 30, 2020				December 31, 2019
	Reinsurance recoverables			A.M. Best rating	Reinsurance recoverables			A.M. Best rating
	(In thousands)
Pecan Re Inc. ^{(1) (2)}	$	2,670,796		N/R	$	2,696,924		NR
SCOR Global Life Reinsurance Companies ⁽³⁾		377,723		A+		352,049		A+
Munich Re of Malta ^{(2) (5)}		272,995		N/R		286,433		NR
Swiss Re Life & Health America Inc. ⁽⁴⁾		238,367		A+		233,572		A+
American Health and Life Insurance Company ⁽²⁾		164,540		B++		167,471		B++
Munich American Reassurance Company		131,762		A+		118,372		A+
RGA Reinsurance		118,766		A+		100,328		A+
Korean Reinsurance Company		118,640		A		108,410		A
Hannover Life Reassurance Company		39,820		A+		33,772		A+
TOA Reinsurance Company		37,053		A		26,160		A
All other reinsurers		64,220		-		48,679		-
Allowance for credit losses		(5,594	)			(2,347	)
Reinsurance recoverables	$	4,229,088			$	4,169,823

NR – not rated

⁽¹⁾	^{Pecan Re Inc. is a wholly owned subsidiary of Swiss Re Life & Health America Inc.}

⁽²⁾

Reinsurance recoverables includes balances ceded under coinsurance transactions of term life insurance policies that were in force as of December 31, 2009. Amounts shown are net of their share of the reinsurance recoverables from other reinsurers. Arrangements with these reinsurers include collateral trust agreements held in support of reinsurance recoverables.

⁽³⁾	Includes amounts ceded to Transamerica Reinsurance Companies and fully retroceded to SCOR Global Life Reinsurance Companies.

⁽⁴⁾	Includes amounts ceded to Lincoln National Life Insurance and fully retroceded to Swiss Re Life & Health America Inc.

⁽⁵⁾	^{Entity is rated AA- by S&P.}

Allowance for Credit Loss on Reinsurance Recoverable

The rollforward of the allowance for credit losses on reinsurance recoverables for the three and nine months ended September 30, 2020 was as follows:

	Three months ended September, 2020			Nine months ended September 30, 2020
	(In thousands)
Balance, beginning of period ⁽¹⁾	$	5,602		$	3,917
Current period provision for expected credit losses		-			1,685
Less: Recoveries from expected credit losses previously recorded		(8	)		(8	)
Balance, at the end of period	$	5,594		$	5,594

⁽¹⁾ The beginning balance for the nine months ended September 30, 2020 reflects the adjustment made to the allowance for credit losses balance for the adoption of ASC 326 on January 1, 2020.