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Investments (Tables)
 3 Months Ended
Mar. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Summary of Fixed Maturities and Equity Securities Available for Sale by Cost or Amortized Cost and Estimated Fair Value
Summaries of fixed maturities available for sale by cost or amortized cost and estimated fair value at March 31, 2019 and December 31, 2018 are shown below.
 
March 31, 2019
 
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair Value(1)
 
% of Total
Fixed
Maturities(2)
Fixed maturities available for sale:
 
 
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
390,947

 
$
16,443

 
$
(1,034
)
 
$
406,356

 
2
States, municipalities, and political subdivisions
1,426,461

 
113,371

 
(174
)
 
1,539,658

 
9
Foreign governments
19,402

 
2,222

 
—

 
21,624

 
—
Corporates, by sector:
 
 
 
 
 
 
 
 
 
Financial
3,864,828

 
387,731

 
(44,465
)
 
4,208,094

 
24
Utilities
1,984,792

 
279,830

 
(9,690
)
 
2,254,932

 
13
Energy
1,645,409

 
172,802

 
(27,409
)
 
1,790,802

 
10
Other corporate sectors
6,452,950

 
438,527

 
(115,784
)
 
6,775,693

 
40
Total corporates
13,947,979

 
1,278,890

 
(197,348
)
 
15,029,521

 
87
Collateralized debt obligations
57,473

 
25,664

 
(5,888
)
 
77,249

 
1
Other asset-backed securities
145,966

 
3,577

 
(366
)
 
149,177

 
1
Total fixed maturities
$
15,988,228

 
$
1,440,167

 
$
(204,810
)
 
$
17,223,585

 
100
(1)
Amounts reported on the balance sheet.
(2)
At fair value.
 
December 31, 2018
 
Cost or
Amortized
Cost
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Fair Value(1)
 
% of Total
Fixed
Maturities(2)
Fixed maturities available for sale:
 
 
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
390,351

 
$
5,104

 
$
(2,787
)
 
$
392,668

 
2
States, municipalities, and political subdivisions
1,354,810

 
83,600

 
(1,750
)
 
1,436,660

 
9
Foreign governments
19,006

 
1,810

 
—

 
20,816

 
—
Corporates, by sector:
 
 
 
 
 
 
 
 
 
Financial
3,759,768

 
262,875

 
(87,515
)
 
3,935,128

 
24
Utilities
1,989,506

 
217,846

 
(24,399
)
 
2,182,953

 
13
Energy
1,652,700

 
93,880

 
(62,371
)
 
1,684,209

 
10
Other corporate sectors
6,382,707

 
283,524

 
(242,509
)
 
6,423,722

 
40
Total corporates
13,784,681

 
858,125

 
(416,794
)
 
14,226,012

 
87
Collateralized debt obligations
57,769

 
22,014

 
(6,414
)
 
73,369

 
1
Other asset-backed securities
146,854

 
2,187

 
(634
)
 
148,407

 
1
Total fixed maturities
$
15,753,471

 
$
972,840

 
$
(428,379
)
 
$
16,297,932

 
100

(1)
Amounts reported on the balance sheet.
(2)
At fair value.
Schedule of Fixed Maturities by Contractual Maturity Date
A schedule of fixed maturities available for sale by contractual maturity date at March 31, 2019 is shown below on an amortized cost basis and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions.
 
March 31, 2019
 
Amortized
Cost
 
Fair Value
Fixed maturities available for sale:
 
 
 
Due in one year or less
$
204,444

 
$
206,980

Due after one year through five years
611,042

 
643,173

Due after five years through ten years
1,643,633

 
1,814,976

Due after ten years through twenty years
5,210,071

 
5,843,176

Due after twenty years
8,114,988

 
8,488,204

Mortgage-backed and asset-backed securities
204,050

 
227,076

 
$
15,988,228

 
$
17,223,585
Net Investment Income
Net investment income for the three months ended March 31, 2019 and 2018 is summarized as follows:
 
Three Months Ended 
 March 31,
 
2019
 
2018
Fixed maturities available for sale
$
215,763

 
$
208,542

Policy loans
10,636

 
10,198

Other long-term investments
3,388

 
2,854

Short-term investments
819

 
391

 
230,606

 
221,985

Less investment expense
(3,933
)
 
(3,901
)
Net investment income
$
226,673

 
$
218,084
Schedule Of Selected Information About Sales Of Fixed Maturities Available for Sale
Selected information about sales of fixed maturities available for sale is as follows:
 
Three Months Ended 
 March 31,
 
2019
 
2018
Fixed maturities available for sale:
 
 
 
Proceeds from sales
$
34,997

 
$
—

Gross realized gains
46

 
—

Gross realized losses
(3,027
)
 
—
Analysis of Realized Gains (Losses) on Investments
An analysis of realized gains (losses) is as follows:
 
Three Months Ended 
 March 31,
 
2019
 
2018
Realized investment gains (losses):
 
 
 
Fixed maturities available for sale:
 
 
 
Sales and other
$
3,670

 
$
1,386

Fair value option—change in fair value
(2,185
)
 
560

Other investments
(156
)
 
5

Realized gains (losses) from investments
1,329

 
1,951

Applicable tax
(279
)
 
(410
)
Realized gains (losses), net of tax
$
1,050

 
$
1,541
Schedule of Assets Measured at Fair Value on Recurring Basis
The following tables represent the fair value of fixed maturities available for sale measured on a recurring basis at March 31, 2019 and December 31, 2018.
 
Fair Value Measurements at March 31, 2019 using:
 
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
 
Significant Other
Observable
Inputs (Level 2)
 
Significant
Unobservable
Inputs (Level 3)
 
Total Fair
Value
Fixed maturities available for sale:
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
—

 
$
406,356

 
$
—

 
$
406,356

States, municipalities, and political subdivisions
—

 
1,539,658

 
—

 
1,539,658

Foreign governments
—

 
21,624

 
—

 
21,624

Corporates, by sector:
 
 
 
 
 
 
 
Financial
—

 
4,163,932

 
44,162

 
4,208,094

Utilities
5,100

 
2,098,883

 
150,949

 
2,254,932

Energy
—

 
1,750,336

 
40,466

 
1,790,802

Other corporate sectors
—

 
6,448,950

 
326,743

 
6,775,693

Total corporates
5,100

 
14,462,101

 
562,320

 
15,029,521

Collateralized debt obligations
—

 
—

 
77,249

 
77,249

Other asset-backed securities
—

 
136,023

 
13,154

 
149,177

Total fixed maturities
$
5,100

 
$
16,565,762

 
$
652,723

 
$
17,223,585

Percentage of total
—
%
 
96.2
%
 
3.8
%
 
100.0
%

 
Fair Value Measurements at December 31, 2018 using:
 
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
 
Significant Other
Observable
Inputs (Level 2)
 
Significant
Unobservable
Inputs (Level 3)
 
Total Fair
Value
Fixed maturities available for sale:
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
—

 
$
392,668

 
$
—

 
$
392,668

States, municipalities, and political subdivisions
—

 
1,436,660

 
—

 
1,436,660

Foreign governments
—

 
20,816

 
—

 
20,816

Corporates, by sector:
 
 
 
 
 
 


Financial
—

 
3,891,728

 
43,400

 
3,935,128

Utilities
—

 
2,032,127

 
150,826

 
2,182,953

Energy
—

 
1,645,077

 
39,132

 
1,684,209

Other corporate sectors
—

 
6,103,609

 
320,113

 
6,423,722

Total corporates
—

 
13,672,541

 
553,471

 
14,226,012

Collateralized debt obligations
—

 
—

 
73,369

 
73,369

Other asset-backed securities
—

 
135,425

 
12,982

 
148,407

Total fixed maturities
$
—

 
$
15,658,110

 
$
639,822

 
$
16,297,932

Percentage of total
—
%
 
96.1
%
 
3.9
%
 
100.0
%
Schedule of Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs
The following tables represent an analysis of changes in fair value measurements using significant unobservable inputs (Level 3) for the three months ended March 31, 2019 and 2018.

Analysis of Changes in Fair Value Measurements Using
Significant Unobservable Inputs (Level 3)
 
Three Months Ended March 31, 2019
 
Asset-
Backed
Securities
 
Collateralized
Debt
Obligations
 
Corporates(1)
 
Total
Balance at January 1, 2019
$
12,982

 
$
73,369

 
$
553,471

 
$
639,822

Total gains or losses:
 
 
 
 
 
 
 
Included in realized gains/losses
—

 
—

 
—

 
—

Included in other comprehensive income
298

 
4,176

 
10,663

 
15,137

Acquisitions
—

 
—

 
—

 
—

Sales
—

 
—

 
—

 
—

Amortization
—

 
1,162

 
3

 
1,165

Other(2)
(126
)
 
(1,458
)
 
(1,817
)
 
(3,401
)
Transfers in and/or out of Level 3(3)
—

 
—

 
—

 
—

Balance at March 31, 2019
$
13,154

 
$
77,249

 
$
562,320

 
$
652,723

Percent of total fixed maturities
0.1
%
 
0.4
%
 
3.3
%
 
3.8
%
(1)
Includes redeemable preferred stocks.
(2)
Includes capitalized interest, foreign exchange adjustments, and principal repayments.
(3)
Considered to be transferred at the end of the period. Transfers into Level 3 occur when observable inputs are no longer available. Transfers out of Level 3 occur when observable inputs become available.

 
Three Months Ended March 31, 2018
 
Asset-
Backed
Securities
 
Collateralized
Debt
Obligations
 
Corporates(1)
 
Total
Balance at January 1, 2018
$
14,049

 
$
71,581

 
$
582,810

 
$
668,440

Total gains or losses:
 
 
 
 
 
 
 
Included in realized gains/losses
—

 
—

 
—

 
—

Included in other comprehensive income
(749
)
 
4,621

 
(12,233
)
 
(8,361
)
Acquisitions
—

 
—

 
—

 
—

Sales
—

 
—

 
—

 
—

Amortization
—

 
1,201

 
4

 
1,205

Other(2)
(113
)
 
(1,879
)
 
(1,781
)
 
(3,773
)
Transfers in and/or out of Level 3(3)
—

 
—

 
—

 
—

Balance at March 31, 2018
$
13,187

 
$
75,524

 
$
568,800

 
$
657,511

Percent of total fixed maturities
0.1
%
 
0.5
%
 
3.4
%
 
4.0
%
(1)
Includes redeemable preferred stocks.
(2)
Includes capitalized interest, foreign exchange adjustments, and principal repayments.
(3)
Considered to be transferred at the end of the period. Transfers into Level 3 occur when observable inputs are no longer available. Transfers out of Level 3 occur when observable inputs become available.
Transfers In And Out Of Each Of Valuation Levels Of Fair Values
The following table presents transfers in and out of each of the valuation levels of fair values.
 
Three Months Ended March 31,
 
2019
 
2018
 
In
 
Out
 
Net
 
In
 
Out
 
Net
Level 1
$
5,100

 
$
—

 
$
5,100

 
$
—

 
$
—

 
$
—

Level 2
—

 
(5,100
)
 
(5,100
)
 
—

 
—

 
—

Level 3
—

 
—

 
—

 
—

 
—

 
—
Schedule Of Other Long Term Investments
Other long-term investments consist of the following:
 
March 31, 2019
 
December 31, 2018
Investment in limited partnerships(1)
$
118,556

 
$
108,241

Commercial mortgage loan participations(2)
110,209

 
96,266

Other
3,169

 
2,751

Total other long-term investments
$
231,934

 
$
207,258

(1)
See the following section for more information regarding the fair value option method used to account for these investments.
(2)
Torchmark invests in a portfolio of commercial mortgage loan participations. As of March 31, 2019 and December 31, 2018, the Company evaluated the portfolio on a loan-by-loan basis to determine any allowance for loss. Factors considered include, but are not limited to, collateral value, loan-to-value ratio, debt service coverage ratio, local market conditions, credit quality of the borrower and tenants, and loan performance. There were no material changes to the property type, geographic location, or loan-to-value ratio for any of the loans during the quarter. As of March 31, 2019 and December 31, 2018, there was no allowance for loss.
Fair Value of Investments Elected for the Fair Value Option
The following table represents the fair value of certain limited partnership investments elected for the fair value option method measured on a recurring basis at March 31, 2019, and the changes in fair value for the three months ended March 31, 2019. All changes in fair value are recognized in "Realized Investment Gains (Losses)" in the Condensed Consolidated Statements of Operations. Distributions received on a periodic basis are recorded in Net Investment Income.
 
 Quoted Prices in Active Markets for Identical Assets (Level 1)
 
 Significant Other Observable Inputs
(Level 2)
 
 Significant Unobservable Inputs
(Level 3)
 
 Total Fair Value
Fair Value Measurements at:
 
 
 
 
 
 
 
March 31, 2019
$
—

 
$
118,556

 
$
—

 
$
118,556

December 31, 2018
—

 
108,241

 
—

 
108,241


 
Changes in Fair Values for the Period for Items Measured at Fair Value Pursuant to Election of the Fair Value Option
 
 Net Gains and Losses Recognized During the Period
 
 Less Net Gains and Losses Recognized due to Sales
 
 Total Changes in Fair Values Included in Current-Period Earnings
Three Months Ended March 31,
 
 
 
 
 
2019
$
(2,185
)
 
$
—

 
$
(2,185
)
2018
560

 
—

 
560
Schedule of Information About Investments in Unrealized Loss Position
The following table discloses information about fixed maturities available for sale in an unrealized loss position.
 
Less than
Twelve
Months
 
Twelve
Months
or Longer
 
Total
Number of issues (CUSIP numbers) held:
 
 
 
 
 
As of March 31, 2019
83

 
311

 
394

As of December 31, 2018
495

 
234

 
729
Schedule of Unrealized Investment Losses by Class of Investment
The following tables disclose unrealized investment losses by class and major sector of fixed maturities available for sale at March 31, 2019 and December 31, 2018, respectively. Torchmark considers these investments to be only temporarily impaired.

Analysis of Gross Unrealized Investment Losses
 
At March 31, 2019
 
Less than
Twelve Months
 
Twelve Months
or Longer
 
Total
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
 
Fair
Value
 
Unrealized
Loss
Fixed maturities available for sale:
 
 
 
 
 
 
 
 
 
 
 
Investment grade securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
6

 
$
—

 
$
61,709

 
$
(1,034
)
 
$
61,715

 
$
(1,034
)
States, municipalities and political subdivisions
14,974

 
(26
)
 
1,056

 
(5
)
 
16,030

 
(31
)
Corporates, by sector:
 
 
 
 
 
 
 
 
 
 
 
Financial
69,791

 
(1,004
)
 
388,946

 
(15,440
)
 
458,737

 
(16,444
)
Utilities
2,023

 
(2
)
 
177,061

 
(5,553
)
 
179,084

 
(5,555
)
Energy
48,948

 
(693
)
 
145,645

 
(7,662
)
 
194,593

 
(8,355
)
Other corporate sectors
392,572

 
(12,612
)
 
1,560,588

 
(82,520
)
 
1,953,160

 
(95,132
)
Total corporates
513,334

 
(14,311
)
 
2,272,240

 
(111,175
)
 
2,785,574

 
(125,486
)
Other asset-backed securities
98

 
—

 
4,463

 
(23
)
 
4,561

 
(23
)
Total investment grade securities
528,412

 
(14,337
)
 
2,339,468

 
(112,237
)
 
2,867,880

 
(126,574
)
 
 
 
 
 
 
 
 
 
 
 
 
Below investment grade securities:
 
 
 
 
 
 
 
 
 
 
 
States, municipalities and political subdivisions
85

 
(143
)
 
—

 
—

 
85

 
(143
)
Corporates, by sector:


 


 


 


 
 
 
 
Financial
—

 
—

 
104,759

 
(28,021
)
 
104,759

 
(28,021
)
Utilities
—

 
—

 
12,648

 
(4,135
)
 
12,648

 
(4,135
)
Energy
11,207

 
(589
)
 
47,260

 
(18,465
)
 
58,467

 
(19,054
)
Other corporate sectors
35,189

 
(2,153
)
 
94,367

 
(18,499
)
 
129,556

 
(20,652
)
Total corporates
46,396

 
(2,742
)
 
259,034

 
(69,120
)
 
305,430

 
(71,862
)
Collateralized debt obligations
—

 
—

 
14,112

 
(5,888
)
 
14,112

 
(5,888
)
Other asset-backed securities
14,132

 
(343
)
 
—

 
—

 
14,132

 
(343
)
Total below investment grade securities
60,613

 
(3,228
)
 
273,146

 
(75,008
)
 
333,759

 
(78,236
)
Total fixed maturities
$
589,025

 
$
(17,565
)
 
$
2,612,614

 
$
(187,245
)
 
$
3,201,639

 
$
(204,810
)


Analysis of Gross Unrealized Investment Losses
 
At December 31, 2018
 
Less than
Twelve Months
 
Twelve Months
or Longer
 
Total
 
Fair
Value
 
Unrealized
Loss
 
Fair Value
 
Unrealized
Loss
 
Fair Value
 
Unrealized
Loss
Fixed maturities available for sale:
 
 
 
 
 
 
 
 
 
 
 
Investment grade securities:
 
 
 
 
 
 
 
 
 
 
 
U.S. Government direct, guaranteed, and government-sponsored enterprises
$
37,182

 
$
(212
)
 
$
89,664

 
$
(2,575
)
 
$
126,846

 
$
(2,787
)
States, municipalities and political subdivisions
124,907

 
(1,648
)
 
7,981

 
(102
)
 
132,888

 
(1,750
)
Corporates, by sector:
 
 
 
 
 
 
 
 
 
 
 
Financial
931,161

 
(36,337
)
 
241,442

 
(21,572
)
 
1,172,603

 
(57,909
)
Utilities
329,753

 
(11,680
)
 
121,308

 
(9,442
)
 
451,061

 
(21,122
)
Energy
475,736

 
(29,426
)
 
54,937

 
(9,382
)
 
530,673

 
(38,808
)
Other corporate sectors
2,515,541

 
(149,168
)
 
575,796

 
(62,994
)
 
3,091,337

 
(212,162
)
Total corporates
4,252,191

 
(226,611
)
 
993,483

 
(103,390
)
 
5,245,674

 
(330,001
)
Other asset-backed securities
44,603

 
(634
)
 
—

 
—

 
44,603

 
(634
)
Total investment grade securities
4,458,883

 
(229,105
)
 
1,091,128

 
(106,067
)
 
5,550,011

 
(335,172
)
 
 
 
 
 
 
 
 
 
 
 
 
Below investment grade securities:
 
 
 
 
 
 
 
 
 
 
 
States, municipalities and political subdivisions
—

 
—

 
—

 
—

 
—

 
—

Corporates, by sector:
 
 
 
 
 
 
 
 
 
 
 
Financial
22,087

 
(8,674
)
 
81,101

 
(20,932
)
 
103,188

 
(29,606
)
Utilities
28,613

 
(3,277
)
 
—

 
—

 
28,613

 
(3,277
)
Energy
42,874

 
(3,901
)
 
36,122

 
(19,662
)
 
78,996

 
(23,563
)
Other corporate sectors
146,373

 
(7,235
)
 
69,053

 
(23,112
)
 
215,426

 
(30,347
)
Total corporates
239,947

 
(23,087
)
 
186,276

 
(63,706
)
 
426,223

 
(86,793
)
Collateralized debt obligations
—

 
—

 
13,586

 
(6,414
)
 
13,586

 
(6,414
)
Other asset-backed securities
—

 
—

 
—

 
—

 
—

 
—

Total below investment grade securities
239,947

 
(23,087
)
 
199,862

 
(70,120
)
 
439,809

 
(93,207
)
Total fixed maturities
$
4,698,830

 
$
(252,192
)
 
$
1,290,990

 
$
(176,187
)
 
$
5,989,820

 
$
(428,379
)