INVESTMENT OPERATIONS (Tables)

9 Months Ended

Sep. 30, 2019

Investments, Debt and Equity Securities [Abstract]

Realized Gain (Loss) on Investments

Net realized gains (losses) are summarized as follows:

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Fixed maturities	$	15,686	$	(2,018)	$	21,885	$	6,248
Equity gains and losses	6,117		(6,925)		44,292		(16,693)
Modco trading portfolio	67,674		(10,901)		252,147		(148,427)
Other investments	(1,260)		(312)		(1,070)		1,522
Realized gains (losses) - all other investments	88,217		(20,156)		317,254		(157,350)
Realized gains (losses) - derivatives(1)	42,286		(26,710)		(86,288)		37,176
Realized investment gains (losses)	$	130,503	$	(46,866)	$	230,966	$	(120,174)
Net impairments losses recognized in earnings	$	(10,818)	$	(14)	$	(14,658)	$	(3,664)
(1) See Note 7, Derivative Financial Instruments

Gross realized gains and gross realized losses on investments available-for-sale (fixed maturities and short-term investments) are as follows:

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Gross realized gains	$	20,155	$	3,410	$	34,801	$	21,540
Gross realized losses:
Impairment losses	$	(10,818)	$	(14)	$	(14,658)	$	(3,664)
Other realized losses	$	(4,469)	$	(5,428)	$	(12,916)	$	(15,292)

Schedule of Fair Value (Proceeds) and Gains (Losses) on Securities in an Unrealized Gain or Loss Position

The chart below summarizes the fair value (proceeds) and the gains (losses) realized on securities the Company sold that were in an unrealized gain position and an unrealized loss position.

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Securities in an unrealized gain position:
Fair value (proceeds)	$	679,514	$	306,600	$	1,812,992	$	909,846
Gains realized	$	20,155	$	3,410	$	34,801	$	21,540
Securities in an unrealized loss position(1):
Fair value (proceeds)	$	37,488	$	122,317	$	368,416	$	380,493
Losses realized	$	(4,469)	$	(5,428)	$	(12,916)	$	(15,292)
(1) The Company made the decision to exit these holdings in conjunction with its overall asset/liability management process.

Realized Gain (Loss) on Equity Securities

The chart below summarizes the realized gains (losses) on equity securities sold during the period and equity securities still held at the reporting date.

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Net gains (losses) recognized during the period on equity securities	$	6,117	$	(6,925)	$	44,292	$	(16,693)
Less: net gains (losses) recognized on equity securities sold during the period	$	(648)	$	(1,476)	$	(395)	$	(3,858)
Gains (losses) recognized during the period on equity securities still held	$	6,765	$	(5,449)	$	44,687	$	(12,835)

Schedule of Amortized Cost and Fair Value of the Company's Investments Classified as Available-for-Sale

The amortized cost and fair value of the Company’s investments classified as available-for-sale are as follows:

As of September 30, 2019	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Total OTTI Recognized in OCI(1)
	(Dollars In Thousands)
Fixed maturities:
Residential mortgage-backed securities	$	5,151,583	$	194,100	$	(5,020)	$	5,340,663	$	—
Commercial mortgage-backed securities	2,627,310		88,275		(1,119)		2,714,466		—
Other asset-backed securities	1,878,663		32,830		(13,017)		1,898,476		(3)
U.S. government-related securities	1,154,940		9,836		(2,569)		1,162,207		—
Other government-related securities	552,445		52,421		(1,630)		603,236		—
States, municipals, and political subdivisions	4,503,629		331,625		(597)		4,834,657		1,274
Corporate securities	44,960,104		2,648,863		(323,362)		47,285,605		(24,644)
Redeemable preferred stocks	87,348		4,217		(4,003)		87,562		—
	60,916,022		3,362,167		(351,317)		63,926,872		(23,373)
Short-term investments	945,459		—		—		945,459		—
	$	61,861,481	$	3,362,167	$	(351,317)	$	64,872,331	$	(23,373)
As of December 31, 2018	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value		Total OTTI Recognized in OCI(1)
	(Dollars In Thousands)
Fixed maturities:
Residential mortgage-backed securities	$	3,641,678	$	23,248	$	(61,935)	$	3,602,991	$	(18)
Commercial mortgage-backed securities	2,319,476		3,911		(57,000)		2,266,387		—
Other asset-backed securities	1,410,059		17,232		(35,398)		1,391,893		—
U.S. government-related securities	1,658,433		1,794		(45,722)		1,614,505		—
Other government-related securities	543,534		4,292		(33,790)		514,036		—
States, municipals, and political subdivisions	3,682,037		25,706		(118,902)		3,588,841		876
Corporate securities	38,467,380		112,438		(2,378,240)		36,201,578		(29,685)
Redeemable preferred stocks	94,362		—		(11,560)		82,802		—
	51,816,959		188,621		(2,742,547)		49,263,033		(28,827)
Short-term investments	635,375		—		—		635,375		—
	$	52,452,334	$	188,621	$	(2,742,547)	$	49,898,408	$	(28,827)
(1) These amounts are included in the gross unrealized gains and gross unrealized losses columns above.

Schedule of Fair Value of Trading Securities

The fair value of the investments held pursuant to these Modco arrangements are as follows:

	As of
	September 30, 2019		December 31, 2018
	(Dollars In Thousands)
Fixed maturities:
Residential mortgage-backed securities	$	202,963	$	241,836
Commercial mortgage-backed securities	208,935		188,925
Other asset-backed securities	137,732		159,907
U.S. government-related securities	48,112		59,794
Other government-related securities	26,792		44,207
States, municipals, and political subdivisions	300,332		286,413
Corporate securities	1,599,453		1,423,833
Redeemable preferred stocks	12,195		11,277
	2,536,514		2,416,192
Equity securities	6,647		9,892
Short-term investments	98,983		30,926
	$	2,642,144	$	2,457,010

Schedule of Amortized Cost and Fair Value of Available-for-Sale and Held-to-Maturity Fixed Maturities, by Expected Maturity

The amortized cost and fair value of available-for-sale and held-to-maturity fixed maturities as of September 30, 2019, by expected maturity, are shown below. Expected maturities of securities without a single maturity date are allocated based on estimated rates of prepayment that may differ from actual rates of prepayment.

	Available-for-sale				Held-to-maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(Dollars In Thousands)
Due in one year or less	$	1,830,025	$	1,828,513	$	—	$	—
Due after one year through five years	9,960,533		10,147,215		—		—
Due after five years through ten years	13,576,841		14,198,510		—		—
Due after ten years	35,548,623		37,752,634		2,544,054		2,685,076
	$	60,916,022	$	63,926,872	$	2,544,054	$	2,685,076

Gain (Loss) on Investments

The charts below summarize the Company’s other-than-temporary impairments of investments. All of the impairments were related to fixed maturities.

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	Fixed Maturities		Fixed Maturities		Fixed Maturities		Fixed Maturities
	(Dollars In Thousands)
Other-than-temporary impairments	$	(39,752)	$	(14)	$	(41,245)	$	(715)
Non-credit impairment losses recorded in other comprehensive income (loss)	28,934		—		26,587		(2,949)
Net impairment losses recognized in earnings	$	(10,818)	$	(14)	$	(14,658)	$	(3,664)

Schedule of Available-for-Sale Credit Losses on Fixed Maturities Held by the Company for Which a Portion of Other-than-Temporary Impairments were Recognized in Other Comprehensive Income (Loss)

The following chart is a rollforward of available-for-sale credit losses on fixed maturities held by the Company for which a portion of an other-than-temporary impairment was recognized in other comprehensive income (loss):

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Beginning balance	$	12,498	$	2	$	24,868	$	3,268
Additions for newly impaired securities	10,805		—		11,556		—
Additions for previously impaired securities	—		—		3,007		2
Reductions for previously impaired securities due to a change in expected cash flows	(12,498)		—		(21,332)		—
Reductions for previously impaired securities that were sold in the current period	—		(2)		(7,294)		(3,270)
Ending balance	$	10,805	$	—	$	10,805	$	—

Schedule of Investments' Gross Unrealized Losses and Fair Value of the Company's Investments that are Not Deemed to be Other-than-Temporarily Impaired

The following table includes the gross unrealized losses and fair value of the Company’s investments that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of September 30, 2019:

	Less Than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
	(Dollars In Thousands)
Residential mortgage-backed securities	$	484,979	$	(2,069)	$	287,356	$	(2,951)	$	772,335	$	(5,020)
Commercial mortgage-backed securities	67,255		(78)		117,799		(1,041)		185,054		(1,119)
Other asset-backed securities	453,923		(7,510)		162,369		(5,507)		616,292		(13,017)
U.S. government-related securities	265,257		(844)		335,336		(1,725)		600,593		(2,569)
Other government-related securities	57,008		(488)		10,427		(1,142)		67,435		(1,630)
States, municipals, and political subdivisions	35,092		(297)		15,215		(300)		50,307		(597)
Corporate securities	2,133,888		(43,884)		3,624,679		(279,478)		5,758,567		(323,362)
Redeemable preferred stocks	—		—		16,935		(4,003)		16,935		(4,003)
	$	3,497,402	$	(55,170)	$	4,570,116	$	(296,147)	$	8,067,518	$	(351,317)

Schedule of Investments' Gross Unrealized Losses and Fair Value of the Company's Investments that are Not Deemed to be Other-than-Temporarily Impaired

The following table includes the gross unrealized losses and fair value of the Company’s investments that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2018:

	Less Than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
	(Dollars In Thousands)
Residential mortgage-backed securities	$	1,485,009	$	(31,302)	$	795,765	$	(30,633)	$	2,280,774	$	(61,935)
Commercial mortgage-backed securities	419,420		(7,398)		1,405,690		(49,602)		1,825,110		(57,000)
Other asset-backed securities	687,271		(30,963)		148,871		(4,435)		836,142		(35,398)
U.S. government-related securities	130,290		(4,668)		1,085,654		(41,054)		1,215,944		(45,722)
Other government-related securities	224,273		(15,207)		131,569		(18,583)		355,842		(33,790)
States, municipals, and political subdivisions	1,004,262		(27,180)		1,129,152		(91,722)		2,133,414		(118,902)
Corporate securities	18,225,656		(966,825)		12,824,024		(1,411,415)		31,049,680		(2,378,240)
Redeemable preferred stocks	41,147		(4,467)		41,655		(7,093)		82,802		(11,560)
	$	22,217,328	$	(1,088,010)	$	17,562,380	$	(1,654,537)	$	39,779,708	$	(2,742,547)

Summary of Change in Unrealized Gains (Losses), Net of Income Tax, on Fixed Maturity and Equity Securities, Classified as Available-for-Sale

The change in unrealized gains (losses), net of income tax, on fixed maturities, classified as available-for-sale is summarized as follows:

	For The Three Months Ended September 30,				For The Nine Months Ended September 30,
	2019		2018		2019		2018
	(Dollars In Thousands)
Fixed maturities	$	1,308,054	$	(229,609)	$	4,396,173	$	(1,727,358)

Schedule of Amortized Cost and Fair Value of the Company's Investments Classified as Held-to-Maturity

The amortized cost and fair value of the Company’s investments classified as held-to-maturity as of September 30, 2019 and December 31, 2018, are as follows:

As of September 30, 2019	Amortized Cost		Gross Unrecognized Holding Gains		Gross Unrecognized Holding Losses		Fair Value		Total OTTI Recognized in OCI
	(Dollars In Thousands)
Fixed maturities:
Securities issued by affiliates:
Red Mountain, LLC	$	782,054	$	10,406	$	—	$	792,460	$	—
Steel City, LLC	1,762,000		130,616		—		1,892,616		—
	$	2,544,054	$	141,022	$	—	$	2,685,076	$	—
As of December 31, 2018	Amortized Cost		Gross Unrecognized Holding Gains		Gross Unrecognized Holding Losses		Fair Value		Total OTTI Recognized in OCI
	(Dollars In Thousands)
Fixed maturities:
Securities issued by affiliates:
Red Mountain, LLC	$	750,474	$	—	$	(81,657)	$	668,817	$	—
Steel City, LLC	1,883,000		—		(4,607)		1,878,393		—
	$	2,633,474	$	—	$	(86,264)	$	2,547,210	$	—