| Investments |
Note 4—Investments Portfolio Composition: Summaries of fixed maturities available for sale by amortized cost, fair value, and allowance for credit losses at September 30, 2024 and December 31, 2023, and the corresponding amounts of gross unrealized gains and losses recognized in accumulated other comprehensive income (loss) are as follows. Redeemable preferred stock is included within "Corporates, by sector." | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | At September 30, 2024 | |
Amortized
Cost | | Allowance for Credit Losses | | 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 | $ | 397,969 | | | $ | — | | | $ | 38 | | | $ | (21,026) | | | $ | 376,981 | | | 2 | | | States, municipalities, and political subdivisions | 3,253,819 | | | — | | | 49,409 | | | (424,989) | | | 2,878,239 | | | 16 | | | Foreign governments | 41,794 | | | — | | | 17 | | | (9,885) | | | 31,926 | | | — | | | Corporates, by sector: | | | | | | | | | | | | | Industrials | 8,115,835 | | | (7,132) | | | 258,165 | | | (508,089) | | | 7,858,779 | | | 43 | | | Financial | 5,014,169 | | | — | | | 171,762 | | | (299,903) | | | 4,886,028 | | | 26 | | | | | | | | | | | | | | | Utilities | 2,140,610 | | | — | | | 109,998 | | | (72,371) | | | 2,178,237 | | | 12 | | | Total corporates | 15,270,614 | | | (7,132) | | | 539,925 | | | (880,363) | | | 14,923,044 | | | 81 | | | Collateralized debt obligations | 36,685 | | | — | | | 5,798 | | | — | | | 42,483 | | | — | | | Other asset-backed securities | 83,573 | | | — | | | 1 | | | (1,677) | | | 81,897 | | | 1 | | Total fixed maturities | $ | 19,084,454 | | | $ | (7,132) | | | $ | 595,188 | | | $ | (1,337,940) | | | $ | 18,334,570 | | | 100 | |
(1)Amount reported in the balance sheet. (2)At fair value. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | At December 31, 2023 | | Amortized
Cost | | Allowance for Credit Losses | | 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 | $ | 398,450 | | | $ | — | | | $ | 7 | | | $ | (32,306) | | | $ | 366,151 | | | 2 | | | States, municipalities, and political subdivisions | 3,296,305 | | | — | | | 47,346 | | | (403,329) | | | 2,940,322 | | | 16 | | | Foreign governments | 44,453 | | | — | | | 1 | | | (10,348) | | | 34,106 | | | — | | | Corporates, by sector: | | | | | | | | | | | | Industrials | 8,016,126 | | | (7,115) | | | 213,078 | | | (566,847) | | | 7,655,242 | | | 43 | | | Financial | 5,028,151 | | | — | | | 112,368 | | | (388,340) | | | 4,752,179 | | | 27 | | | | | | | | | | | | | | | Utilities | 2,017,967 | | | — | | | 73,925 | | | (94,130) | | | 1,997,762 | | | 11 | | | Total corporates | 15,062,244 | | | (7,115) | | | 399,371 | | | (1,049,317) | | | 14,405,183 | | | 81 | | | Collateralized debt obligations | 37,110 | | | — | | | 5,036 | | | — | | | 42,146 | | | — | | | Other asset-backed securities | 86,352 | | | — | | | 3 | | | (4,057) | | | 82,298 | | | 1 | | Total fixed maturities | $ | 18,924,914 | | | $ | (7,115) | | | $ | 451,764 | | | $ | (1,499,357) | | | $ | 17,870,206 | | | 100 | |
(1)Amount reported in the balance sheet. (2)At fair value. The Company has exposure to real estate investment trusts with an average rating of BBB+, which had a fair value of $429 million (2% of the total fixed maturity portfolio) and $425 million (2% of the total fixed maturity portfolio) at September 30, 2024 and December 31, 2023, respectively.
A schedule of fixed maturities available for sale by contractual maturity date at September 30, 2024, is shown below on an amortized cost basis, net of allowance for credit losses, and on a fair value basis. Actual disposition dates could differ from contractual maturities due to call or prepayment provisions. | | | | | | | | | | | | | At September 30, 2024 | | Amortized
Cost, net | | Fair
Value | | Fixed maturities available for sale: | | | | | Due in one year or less | $ | 111,956 | | | $ | 111,456 | | | Due after one year through five years | 748,300 | | | 771,458 | | | Due after five years through ten years | 1,841,477 | | | 1,912,103 | | | Due after ten years through twenty years | 8,954,048 | | | 8,827,993 | | | Due after twenty years | 7,301,254 | | | 6,587,150 | | | Mortgage-backed and asset-backed securities | 120,287 | | | 124,410 | | | $ | 19,077,322 | | | $ | 18,334,570 | |
Analysis of Investment Operations: "Net investment income" for the three and nine month periods ended September 30, 2024 and 2023 is summarized as follows: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | 2024 | | 2023 | | % Change | | 2024 | | 2023 | | % Change | | Fixed maturities available for sale | $ | 245,313 | | | $ | 237,609 | | | 3 | | | $ | 738,626 | | | $ | 704,095 | | | 5 | | | Policy loans | 13,296 | | | 12,446 | | | 7 | | | 39,196 | | | 36,435 | | | 8 | | | Mortgage loans | 7,668 | | | 5,363 | | | 43 | | | 21,337 | | | 13,919 | | | 53 | | Other long-term investments(1) | 19,992 | | | 14,630 | | | 37 | | | 58,608 | | | 38,753 | | | 51 | | | Short-term investments | 3,083 | | | 1,396 | | | | | 8,396 | | | 4,811 | | | | | 289,352 | | | 271,444 | | | 7 | | | 866,163 | | | 798,013 | | | 9 | | | Less investment expense | (4,388) | | | (4,518) | | | (3) | | | (12,985) | | | (12,738) | | | 2 | | Net investment income | $ | 284,964 | | | $ | 266,926 | | | 7 | | | $ | 853,178 | | | $ | 785,275 | | | 9 | |
(1)For the three months ended September 30, 2024 and 2023, the investment funds, accounted for under the fair value option method, recorded $19.1 million and $14.0 million, respectively, in net investment income. For the nine months ended September 30, 2024 and 2023, the investment funds, accounted for under the fair value option method, recorded $56.1 million and $37.2 million, respectively, in net investment income. Refer to Other Long-Term Investments below for further discussion on the investment funds.
Selected information about sales of fixed maturities available for sale is as follows: | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | 2024 | | 2023 | | 2024 | | 2023 | | Fixed maturities available for sale: | | | | | | | | Proceeds from sales(1) | $ | 163,221 | | | $ | 46,210 | | | $ | 674,125 | | | $ | 192,034 | | | Gross realized gains | 2,042 | | | 261 | | | 6,086 | | | 308 | | | Gross realized losses | (1,856) | | | (67,018) | | | (15,824) | | | (77,879) | |
(1)As of September 30, 2024 and 2023, the Company had $0 and $27 thousand of unsettled trades, respectively. An analysis of "Realized gains (losses)" is as follows: | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | 2024 | | 2023 | | 2024 | | 2023 | | Realized investment gains (losses): | | | | | | | | | Fixed maturities available for sale: | | | | | | | | Sales and other(1) | $ | 257 | | | $ | (66,767) | | | $ | (9,716) | | | $ | (77,730) | | | | | | | | | | | Provision for credit losses | — | | | 65,008 | | | (16) | | | (7,500) | | | Fair value option—change in fair value | (3,683) | | | 868 | | | (22,777) | | | 7,954 | | Mortgage loans | (1,376) | | | (59) | | | (3,530) | | | (4,918) | | | Other investments | (16) | | | 880 | | | 1,135 | | | 502 | | Realized gains (losses) from investments | (4,818) | | | (70) | | | (34,904) | | | (81,692) | | | | | | | | | | | Other gains (losses) | 2,626 | | | (2,123) | | | 8,324 | | | 2,729 | | Total realized gains (losses) | (2,192) | | | (2,193) | | | (26,580) | | | (78,963) | | | Applicable tax | 460 | | | 461 | | | 5,582 | | | 16,583 | | Realized gains (losses), net of tax | $ | (1,732) | | | $ | (1,732) | | | $ | (20,998) | | | $ | (62,380) | |
(1)During the three months ended September 30, 2024 and 2023, the Company recorded $3.4 million and $21.1 million of issuer-initiated exchanges of fixed maturities (noncash transactions) that resulted in no realized gains (losses) in either period. During the nine months ended September 30, 2024 and 2023, the Company recorded $82.2 million and $39.0 million of issuer-initiated exchanges of fixed maturities (noncash transactions) that resulted in no realized gains (losses) in either period. Fair Value Measurements: The following tables represent the fair value of fixed maturities measured on a recurring basis at September 30, 2024 and December 31, 2023: | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value Measurement at September 30, 2024: | | 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 | $ | — | | | $ | 376,981 | | | $ | — | | | $ | 376,981 | | | States, municipalities, and political subdivisions | — | | | 2,878,239 | | | — | | | 2,878,239 | | | Foreign governments | — | | | 31,926 | | | — | | | 31,926 | | | Corporates, by sector: | | | | | | | | Industrials | — | | | 7,659,257 | | | 199,522 | | | 7,858,779 | | | Financial | — | | | 4,754,596 | | | 131,432 | | | 4,886,028 | | | | | | | | | | Utilities | — | | | 2,063,380 | | | 114,857 | | | 2,178,237 | | | Total corporates | — | | | 14,477,233 | | | 445,811 | | | 14,923,044 | | | Collateralized debt obligations | — | | | — | | | 42,483 | | | 42,483 | | | Other asset-backed securities | — | | | 74,021 | | | 7,876 | | | 81,897 | | Total fixed maturities | $ | — | | | $ | 17,838,400 | | | $ | 496,170 | | | $ | 18,334,570 | | | Percentage of total | — | % | | 97 | % | | 3 | % | | 100 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | Fair Value Measurement at December 31, 2023: | | 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 | $ | — | | | $ | 366,151 | | | $ | — | | | $ | 366,151 | | | States, municipalities, and political subdivisions | — | | | 2,940,322 | | | — | | | 2,940,322 | | | Foreign governments | — | | | 34,106 | | | — | | | 34,106 | | | Corporates, by sector: | | | | | | | | Industrials | — | | | 7,440,493 | | | 214,749 | | | 7,655,242 | | | Financial | — | | | 4,621,160 | | | 131,019 | | | 4,752,179 | | | | | | | | | | | Utilities | — | | | 1,888,797 | | | 108,965 | | | 1,997,762 | | | Total corporates | — | | | 13,950,450 | | | 454,733 | | | 14,405,183 | | | Collateralized debt obligations | — | | | — | | | 42,146 | | | 42,146 | | | Other asset-backed securities | — | | | 82,298 | | | — | | | 82,298 | | Total fixed maturities | $ | — | | | $ | 17,373,327 | | | $ | 496,879 | | | $ | 17,870,206 | | | Percentage of total | — | % | | 97 | % | | 3 | % | | 100 | % |
The following tables represent changes in fixed maturities measured at fair value on a recurring basis using significant unobservable inputs (Level 3): | | | | | | | | | | | | | | | | | | | | | | | | | Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | | Asset- backed Securities | | Collateralized
Debt
Obligations | | Corporates | | Total | Balance at January 1, 2024 | $ | — | | | $ | 42,146 | | | $ | 454,733 | | | $ | 496,879 | | | | | | | | | | | Included in realized gains / losses | — | | | — | | | — | | | — | | | Included in other comprehensive income | — | | | 762 | | | 5,448 | | | 6,210 | | | Acquisitions | 7,876 | | | — | | | 14,800 | | | 22,676 | | | Sales | — | | | — | | | — | | | — | | | Amortization | — | | | 3,414 | | | (38) | | | 3,376 | | Other(1) | — | | | (3,839) | | | (29,132) | | | (32,971) | | Transfers into Level 3(2) | — | | | — | | | — | | | — | | Transfers out of Level 3(2) | — | | | — | | | — | | | — | | Balance at September 30, 2024 | $ | 7,876 | | | $ | 42,483 | | | $ | 445,811 | | | $ | 496,170 | | | Percent of total fixed maturities | — | % | | — | % | | 3 | % | | 3 | % |
(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments. (2)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.
| | | | | | | | | | | | | | | | | | | | | | | | | Analysis of Changes in Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | | Asset- backed Securities | | Collateralized
Debt
Obligations | | Corporates | | Total | Balance at January 1, 2023 | $ | — | | | $ | 50,364 | | | $ | 478,083 | | | $ | 528,447 | | | | | | | | | | | Included in realized gains / losses | — | | | — | | | — | | | — | | | Included in other comprehensive income | — | | | (8,424) | | | (15,968) | | | (24,392) | | | Acquisitions | — | | | — | | | — | | | — | | | Sales | — | | | — | | | — | | | — | | | Amortization | — | | | 3,429 | | | 5 | | | 3,434 | | Other(1) | — | | | (3,684) | | | (26,669) | | | (30,353) | | Transfers into Level 3(2) | — | | | — | | | — | | | — | | Transfers out of Level 3(2) | — | | | — | | | — | | | — | | Balance at September 30, 2023 | $ | — | | | $ | 41,685 | | | $ | 435,451 | | | $ | 477,136 | | | Percent of total fixed maturities | — | % | | — | % | | 3 | % | | 3 | % |
(1)Includes capitalized interest, foreign exchange adjustments, and principal repayments. (2)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. The following table presents changes in unrealized gains and losses for the period included in accumulated other comprehensive income for assets held at the end of the reporting period for Level 3 classification: | | | | | | | | | | | | | | | | | | | | | | | | | Changes in Unrealized Gains (Losses) included in Accumulated Other Comprehensive Income for Assets Held at the End of the Period | | Asset-
backed Securities | | Collateralized
Debt
Obligations | | Corporates | | Total | At September 30, 2024 | $ | — | | | $ | 762 | | | $ | 5,448 | | | $ | 6,210 | | At September 30, 2023 | — | | | (8,424) | | | (15,968) | | | (24,392) | |
Unrealized Loss Analysis: 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 (CUSIPs) held: | | | | | | | As of September 30, 2024 | 87 | | | 1,553 | | | 1,640 | | | As of December 31, 2023 | 151 | | | 1,614 | | | 1,765 | |
Globe Life's entire fixed maturity portfolio consisted of 2,532 issues by 975 different issuers at September 30, 2024 and 2,473 issues by 980 different issuers at December 31, 2023. The weighted-average quality rating of all unrealized loss positions at amortized cost was A- as of September 30, 2024 and December 31, 2023. The following tables disclose unrealized investment losses by class and major sector of fixed maturities available for sale at September 30, 2024 and December 31, 2023.
Analysis of Gross Unrealized Investment Losses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | At September 30, 2024 | | 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 | $ | — | | | $ | — | | | $ | 374,361 | | | $ | (21,026) | | | $ | 374,361 | | | $ | (21,026) | | | States, municipalities, and political subdivisions | 201,640 | | | (4,821) | | | 1,636,467 | | | (420,168) | | | 1,838,107 | | | (424,989) | | | Foreign governments | — | | | — | | | 28,493 | | | (9,885) | | | 28,493 | | | (9,885) | | | Corporates, by sector: | | | | | | | | | | | | Industrials | 124,717 | | | (11,134) | | | 4,071,839 | | | (464,628) | | | 4,196,556 | | | (475,762) | | | Financial | 19,176 | | | (303) | | | 2,005,383 | | | (261,465) | | | 2,024,559 | | | (261,768) | | | | | | | | | | | | | | Utilities | 7,012 | | | (92) | | | 667,192 | | | (71,489) | | | 674,204 | | | (71,581) | | | Total corporates | 150,905 | | | (11,529) | | | 6,744,414 | | | (797,582) | | | 6,895,319 | | | (809,111) | | | Collateralized debt obligations | — | | | — | | | — | | | — | | | — | | | — | | | Other asset-backed securities | — | | | — | | | 68,549 | | | (1,607) | | | 68,549 | | | (1,607) | | | Total investment grade securities | 352,545 | | | (16,350) | | | 8,852,284 | | | (1,250,268) | | | 9,204,829 | | | (1,266,618) | | | | | | | | | | | | | | | Below investment grade securities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Corporates, by sector: | | | | | | | | | | | | | Industrials | 2,670 | | | (169) | | | 143,088 | | | (32,158) | | | 145,758 | | | (32,327) | | | Financial | 4,199 | | | (13) | | | 178,887 | | | (38,122) | | | 183,086 | | | (38,135) | | | | | | | | | | | | | | | Utilities | — | | | — | | | 11,945 | | | (790) | | | 11,945 | | | (790) | | | Total corporates | 6,869 | | | (182) | | | 333,920 | | | (71,070) | | | 340,789 | | | (71,252) | | | Collateralized debt obligations | — | | | — | | | — | | | — | | | — | | | — | | | Other asset-backed securities | — | | | — | | | 5,432 | | | (70) | | | 5,432 | | | (70) | | | Total below investment grade securities | 6,869 | | | (182) | | | 339,352 | | | (71,140) | | | 346,221 | | | (71,322) | | Total fixed maturities | $ | 359,414 | | | $ | (16,532) | | | $ | 9,191,636 | | | $ | (1,321,408) | | | $ | 9,551,050 | | | $ | (1,337,940) | |
Gross unrealized losses may fluctuate quarter over quarter due to factors in the market that affect our holdings, such as changes in interest rates or credit spreads. The Company considers many factors when determining whether an allowance for a credit loss should be recorded. While the Company holds securities that may be in an unrealized loss position from time to time, Globe Life does not generally intend to sell and it is unlikely that the Company will be required to sell the fixed maturities prior to their anticipated recovery or maturity due to the strong cash flows generated by its insurance operations. Analysis of Gross Unrealized Investment Losses | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | At December 31, 2023 | | 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 | $ | — | | | $ | — | | | $ | 364,006 | | | $ | (32,306) | | | $ | 364,006 | | | $ | (32,306) | | | States, municipalities, and political subdivisions | 252,800 | | | (3,520) | | | 1,610,163 | | | (399,809) | | | 1,862,963 | | | (403,329) | | | Foreign governments | — | | | — | | | 32,591 | | | (10,348) | | | 32,591 | | | (10,348) | | | Corporates, by sector: | | | | | | | | | | | | | Industrials | 191,573 | | | (3,881) | | | 4,317,827 | | | (530,011) | | | 4,509,400 | | | (533,892) | | | Financial | 242,099 | | | (6,584) | | | 2,341,424 | | | (339,628) | | | 2,583,523 | | | (346,212) | | | | | | | | | | | | | | | Utilities | 81,194 | | | (648) | | | 686,043 | | | (91,959) | | | 767,237 | | | (92,607) | | | Total corporates | 514,866 | | | (11,113) | | | 7,345,294 | | | (961,598) | | | 7,860,160 | | | (972,711) | | | Collateralized debt obligations | — | | | — | | | — | | | — | | | — | | | — | | | Other asset-backed securities | — | | | — | | | 70,956 | | | (3,648) | | | 70,956 | | | (3,648) | | | Total investment grade securities | 767,666 | | | (14,633) | | | 9,423,010 | | | (1,407,709) | | | 10,190,676 | | | (1,422,342) | | | | | | | | | | | | | | | Below investment grade securities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Corporates, by sector: | | | | | | | | | | | | | Industrials | 10,745 | | | (199) | | | 145,697 | | | (32,756) | | | 156,442 | | | (32,955) | | | Financial | 25,563 | | | (2,602) | | | 151,190 | | | (39,526) | | | 176,753 | | | (42,128) | | | | | | | | | | | | | | | Utilities | — | | | — | | | 19,654 | | | (1,523) | | | 19,654 | | | (1,523) | | | Total corporates | 36,308 | | | (2,801) | | | 316,541 | | | (73,805) | | | 352,849 | | | (76,606) | | | Collateralized debt obligations | — | | | — | | | — | | | — | | | — | | | — | | | Other asset-backed securities | — | | | — | | | 11,288 | | | (409) | | | 11,288 | | | (409) | | | Total below investment grade securities | 36,308 | | | (2,801) | | | 327,829 | | | (74,214) | | | 364,137 | | | (77,015) | | Total fixed maturities | $ | 803,974 | | | $ | (17,434) | | | $ | 9,750,839 | | | $ | (1,481,923) | | | $ | 10,554,813 | | | $ | (1,499,357) | |
Fixed Maturities, Allowance for Credit Losses: A summary of the activity in the allowance for credit losses is as follows. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | | 2024 | | 2023 | | 2024 | | 2023 | Allowance for credit losses beginning balance | | $ | 7,132 | | | $ | 72,508 | | | $ | 7,115 | | | $ | — | | | Additions to allowance for which credit losses were not previously recorded | | — | | | — | | | — | | | 72,508 | | | Additions (reductions) to allowance for fixed maturities that previously had an allowance | | — | | | (65,008) | | | 17 | | | (65,008) | | | Reduction of allowance for which the Company intends to sell or more likely than not will be required to sell or sold during the period | | — | | | — | | | — | | | — | | Allowance for credit losses ending balance | | $ | 7,132 | | | $ | 7,500 | | | $ | 7,132 | | | $ | 7,500 | |
As of September 30, 2024 and December 31, 2023, the Company did not have any fixed maturities in non-accrual status. Mortgage Loans (commercial mortgage loans): Summaries of commercial mortgage loans by property type and geographical location at September 30, 2024 and December 31, 2023 are as follows: | | | | | | | | | | | | | | | | | | | | | | | | | September 30, 2024 | | December 31, 2023 | | Carrying Value | | % of Total | | Carrying Value | | % of Total | | Property type: | | | | | | | | | Multi-family | $ | 127,155 | | | 33 | | | $ | 116,299 | | | 42 | | | Industrial | 102,402 | | | 27 | | | 57,267 | | | 20 | | | Retail | 73,252 | | | 19 | | | 23,925 | | | 9 | | | Hospitality | 43,435 | | | 11 | | | 43,897 | | | 16 | | | Mixed use | 35,886 | | | 10 | | | 34,749 | | | 12 | | | Office | 6,387 | | | 2 | | | 6,734 | | | 2 | | | | | | | | | | | Total recorded investment | 388,517 | | | 102 | | | 282,871 | | | 101 | | | Less allowance for credit losses | (7,202) | | | (2) | | | (3,672) | | | (1) | | Carrying value, net of allowance for credit losses | $ | 381,315 | | | 100 | | | $ | 279,199 | | | 100 | |
| | | | | | | | | | | | | | | | | | | | | | | | | September 30, 2024 | | December 31, 2023 | | Carrying Value | | % of Total | | Carrying Value | | % of Total | | Geographic location: | | | | | | | | | Texas | $ | 75,002 | | | 20 | | | $ | 45,111 | | | 16 | | | New Jersey | 51,454 | | | 14 | | | 44,574 | | | 16 | | | Florida | 46,506 | | | 12 | | | 48,233 | | | 17 | | | California | 40,715 | | | 11 | | | 54,721 | | | 20 | | | New York | 35,865 | | | 9 | | | 20,284 | | | 7 | | | Alabama | 35,838 | | | 9 | | | 11,003 | | | 4 | | | Other | 103,137 | | | 27 | | | 58,945 | | | 21 | | | Total recorded investment | 388,517 | | | 102 | | | 282,871 | | | 101 | | | Less allowance for credit losses | (7,202) | | | (2) | | | (3,672) | | | (1) | | Carrying value, net of allowance for credit losses | $ | 381,315 | | | 100 | | | $ | 279,199 | | | 100 | |
The following tables are reflective of the key factors, debt service coverage ratios, and loan-to-value (LTV) ratios that are utilized by management to monitor the performance of the portfolios. The Company only makes new investments in commercial mortgage loans that have a LTV ratio less than 80%. LTV's that exceed 80% are generally as a result of decreases in the valuation of the underlying property. Generally, a higher LTV ratio and a lower debt service coverage ratio equates to higher risk of loss. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | September 30, 2024 | | Recorded Investment | | Debt Service Coverage Ratios(1) | | | | | | <1.00x | | 1.00x—1.20x | | >1.20x | | Total | | % of Gross Total | Loan-to-value ratio(2): | | | | | | | | | | | Less than 70% | $ | 22,841 | | | $ | 138,034 | | | $ | 203,226 | | | $ | 364,101 | | | 94 | | | 70% to 80% | 1,058 | | | — | | | — | | | 1,058 | | | — | | | 81% to 90% | 8,569 | | | — | | | — | | | 8,569 | | | 2 | | | Greater than 90% | 14,789 | | | — | | | — | | | 14,789 | | | 4 | | | Total | $ | 47,257 | | | $ | 138,034 | | | $ | 203,226 | | | 388,517 | | | 100 | | | Less allowance for credit losses | | | | | | | (7,202) | | | | Total, net of allowance for credit losses | | | | | | | $ | 381,315 | | | |
(1)Annual net operating income divided by annual mortgage debt service (principal and interest). (2)Loan balance divided by stabilized appraised value at origination, including planned renovations and stabilized occupancy. Updated internal valuations are used when a loan is materially underperforming. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2023 | | Recorded Investment | | Debt Service Coverage Ratios(1) | | | | | | <1.00x | | 1.00x—1.20x | | >1.20x | | Total | | % of Gross Total | Loan-to-value ratio(2): | | | | | | | | | | | Less than 70% | $ | 27,091 | | | $ | 180,761 | | | $ | 58,364 | | | $ | 266,216 | | | 94 | | | 70% to 80% | — | | | — | | | — | | | — | | | — | | | 81% to 90% | 8,468 | | | — | | | 1,153 | | | 9,621 | | | 3 | | | Greater than 90% | 7,034 | | | — | | | — | | | 7,034 | | | 3 | | | Total | $ | 42,593 | | | $ | 180,761 | | | $ | 59,517 | | | 282,871 | | | 100 | | | Less allowance for credit losses | | | | | | | (3,672) | | | | Total, net of allowance for credit losses | | | | | | | $ | 279,199 | | | |
(1)Annual net operating income divided by annual mortgage debt service (principal and interest). (2)Loan balance divided by stabilized appraised value at origination, including planned renovations and stabilized occupancy. Updated internal valuations are used when a loan is materially underperforming.
As of September 30, 2024, the Company evaluated the commercial mortgage loan portfolio on a pool basis to determine the allowance for credit losses. At the end of the period, the Company had 36 loans in the portfolio. For the nine months ended September 30, 2024, the allowance for credit losses increased by $3.5 million to $7.2 million. The provision for credit losses is included in "Realized gains (losses)" in the Condensed Consolidated Statements of Operations. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Three Months Ended
September 30, | | Nine Months Ended
September 30, | | | 2024 | | 2023 | | 2024 | | 2023 | Allowance for credit losses beginning balance | | $ | 5,826 | | | $ | 2,928 | | | $ | 3,672 | | | $ | 1,789 | | | | | | | | | | | | Provision (reversal) for credit losses | | 1,376 | | | 60 | | | 3,530 | | | 1,199 | | | | | | | | | | | Allowance for credit losses ending balance | | $ | 7,202 | | | $ | 2,988 | | | $ | 7,202 | | | $ | 2,988 | |
There was one delinquent commercial mortgage loan, with an outstanding par value of $36.0 million and outstanding interest due of $1.9 million, as of September 30, 2024. The underlying collateral for this loan is in the process of being sold and the Company expects to recover all interest and principal due as of September 30, 2024. There were no delinquent commercial mortgage loans as of December 31, 2023. As of September 30, 2024, the Company had three commercial mortgage loans in non-accrual status with a principal balance of $8.8 million. As of December 31, 2023, the Company had no commercial mortgage loans in non-accrual status. The Company's unfunded commitment balance to commercial loan borrowers was $31 million as of September 30, 2024. Other Long-Term Investments: Other long-term investments consist of the following assets: | | | | | | | | | | | | | September 30,
2024 | | December 31, 2023 | | Investment funds | $ | 979,397 | | | $ | 795,583 | | Company-owned life insurance | 200,114 | | | — | | | Other | 42,377 | | | 40,295 | | Total | $ | 1,221,888 | | | $ | 835,878 | |
During the current quarter ended September 30, 2024, the Company acquired other investments in company-owned life insurance (COLI) in the amount of $200 million. COLI is reported at cash surrender value.
The following table presents additional information about the Company's investment funds as of September 30, 2024 and December 31, 2023 at fair value: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Fair Value | | Unfunded Commitments | | | | | Investment Category | | September 30,
2024 | | December 31, 2023 | | September 30,
2024 | | Redemption Term/Notice(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Commercial mortgage loans | | $ | 567,425 | | | $ | 411,315 | | | $ | 378,892 | | | Fully redeemable and non-redeemable with varying terms. | | Opportunistic and private credit | | 195,957 | | | 181,410 | | | 166,514 | | | Fully redeemable and non-redeemable with varying terms. | | | | | | | | | | | | | | | | | | | | | | | Infrastructure | | 174,971 | | | 165,887 | | | 16,318 | | | Fully redeemable and non-redeemable with varying terms. | | | | | | | | | | | | | | | | | | | | | | | Other | | 41,044 | | | 36,971 | | | 50,757 | | | Non-redeemable with varying terms | | | Total investment funds | | $ | 979,397 | | | $ | 795,583 | | | $ | 612,481 | | | | |
(1) Non-redeemable funds generally have an expected life of 7 to 12 years from fund closing with extension options of 1 to 4 years. Redemptions are paid out throughout the life of the funds at the General Partner's discretion. Redeemable funds can generally be redeemed over 6 to 36 months upon request from limited partners.
The Company had $226 million of capital called during the period from existing investment funds. The Company's unfunded commitments were $612 million as of September 30, 2024.
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