Fair Value of Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2015

Fair Value Disclosures [Abstract]

Schedule of Assets and Liabilities Measured at Fair Value on Recurring Basis

The following tables set forth the Company’s assets and liabilities that are measured at fair value on a recurring basis as of the date indicated:

	March 31, 2015
	Total		Level 1	Level 2	Level 3
	(In thousands)
Debt securities, available for sale	$	2,837,075	—	2,837,075	—
Equity securities, available for sale	17,615		17,059	556	—
Derivatives, index options	95,987		—	—	95,987
Total assets	$	2,950,677	17,059	2,837,631	95,987
Policyholder account balances (a)	$	111,627	—		111,627
Other liabilities (b)	8,360		—	—	8,360
Total liabilities	$	119,987	—	—	119,987

During the three months ended March 31, 2015, the Company had no transfers into or out of Levels 1, 2 or 3.

	December 31, 2014
	Total		Level 1	Level 2	Level 3
	(In thousands)
Debt securities, available for sale	$	2,711,377	—	2,711,377	—
Equity securities, available for sale	17,303		16,862	441	—
Derivatives, index options	114,287		—	—	114,287
Total assets	$	2,842,967	16,862	2,711,818	114,287
Policyholder account balances (a)	$	133,236	—		133,236
Other liabilities (b)	9,256		—	—	9,256
Total liabilities	$	142,492	—	—	142,492

(a)  Represents the fair value of certain product-related embedded derivatives that were recorded at fair value.

(b)  Represents the liability for share-based compensation.

Schedule of Assets by Pricing Source and Fair Value Hierarchy Measured on Recurring Basis

The following tables present, by pricing source and fair value hierarchy level, the Company’s assets that are measured at fair value on a recurring basis:

	March 31, 2015
	Total			Level 1		Level 2		Level 3
	(In thousands)
Debt securities, available for sale:
Priced by third-party vendors	$	2,837,075		—		2,837,075		—
Priced internally	—			—		—		—
Subtotal	2,837,075			—		2,837,075		—
Equity securities, available for sale:
Priced by third-party vendors	17,615			17,059		556		—
Priced internally	—			—		—		—
Subtotal	17,615			17,059		556		—
Derivatives, index options:
Priced by third-party vendors	95,987			—		—		95,987
Priced internally	—			—		—		—
Subtotal	95,987			—		—		95,987
Total	$	2,950,677		17,059		2,837,631		95,987
Percent of total	100.0		%	0.6	%	96.1	%	3.3	%

	December 31, 2014
	Total			Level 1		Level 2		Level 3
	(In thousands)
Debt securities, available for sale:
Priced by third-party vendors	$	2,711,377		—		2,711,377		—
Priced internally	—			—		—		—
Subtotal	2,711,377			—		2,711,377		—
Equity securities, available for sale:
Priced by third-party vendors	17,303			16,862		441		—
Priced internally	—			—		—		—
Subtotal	17,303			16,862		441		—
Derivatives, index options:
Priced by third-party vendors	114,287			—		—		114,287
Priced internally	—			—		—		—
Subtotal	114,287			—		—		114,287
Total	$	2,842,967		16,862		2,711,818		114,287
Percent of total	100.0		%	0.6	%	95.4	%	4.0	%

Schedule of Significant Unobservable Inputs for Fair Value Measurements

The following tables provide additional information about fair value measurements for which significant unobservable (Level 3) inputs were utilized to determine fair value.

	For the Three Months Ended March 31, 2015
	Debt Securities, Available for Sale		Equity Securities, Available for Sale	Derivatives, Index Options		Total Assets		Other Liabilities
	(In thousands)
Balance at January 1, 2015	$	—	—	114,287		114,287		142,492
Total realized and unrealized gains (losses):
Included in net income	—		—	(8,287	)	(8,287	)	(12,383	)
Included in other comprehensive income	—		—	—		—		—
Purchases, sales, issuances and settlements, net:
Purchases	—		—	18,456		18,456		18,456
Sales	—		—	—		—		—
Issuances	—		—	—		—		—
Settlements	—		—	(28,469	)	(28,469	)	(28,578	)
Transfers into (out of) Level 3	—		—	—		—		—
Balance at end of period	$	—	—	95,987		95,987		119,987
Change in unrealized gains or losses for the period included in earnings (or changes in net assets) for assets held at the end of the reporting period:
Net investment income	$	—	—	(6,843	)	(6,843	)	—
Benefits and expenses	—		—	—		—		(787	)
Total	$	—	—	(6,843	)	(6,843	)	(787	)

	For the Three Months ended March 31, 2014
	Debt Securities, Available for Sale		Equity Securities, Available for Sale	Derivatives, Index Options		Total Assets		Other Liabilities
	(In thousands)
Balance at January 1, 2014	$	—	—	169,314		169,314		193,338
Total realized and unrealized gains (losses):
Included in net income	—		—	548		548		2,651
Included in other comprehensive income	—		—	—		—		—
Purchases, sales, issuances and settlements, net:
Purchases	—		—	15,337		15,337		15,337
Sales	—		—	—		—		—
Issuances	—		—	—		—		—
Settlements	—		—	(50,283	)	(50,283	)	(50,790	)
Transfers into (out of) Level 3	—		—	—		—		—
Balance at end of period	$	—	—	134,916		134,916		160,536
Change in unrealized gains or losses for the period included in earnings (or changes in net assets) for assets held at the end of the reporting period:
Net investment income	$	—	—	2,821		2,821		—
Benefits and expenses	—		—	—		—		1,667
Total	$	—	—	2,821		2,821		1,667

Schedule of quantitative information of Level 3 liabilities

The following tables show the quantitative information about the Company's level 3 assets and liabilities.

	March 31, 2015
	Fair Value		Valuation Technique	Unobservable Input
	(In thousands)
Derivatives, index options	$	95,987	Broker prices	Implied volatility
				Inputs from broker proprietary models
Total assets	$	95,987
Policyholder account balances	$	111,627	Deterministic cash flow model	Projected option cost
Other liabilities	8,360		Black-Scholes model	Expected term
				Forfeiture assumptions
Total liabilities	$	119,987

	December 31, 2014
	Fair Value		Valuation Technique	Unobservable Input
	(In thousands)
Derivatives, index options	$	114,287	Broker prices	Implied volatility
				Inputs from broker proprietary models
Total assets	$	114,287
Policyholder account balances	$	133,236	Deterministic cash flow model	Projected option cost
Other liabilities	9,256		Black-Scholes model	Expected term
				Forfeiture assumptions
Total liabilities	$	142,492

Schedule of quantitative information of Level 3 assets

he following tables show the quantitative information about the Company's level 3 assets and liabilities.

	March 31, 2015
	Fair Value		Valuation Technique	Unobservable Input
	(In thousands)
Derivatives, index options	$	95,987	Broker prices	Implied volatility
				Inputs from broker proprietary models
Total assets	$	95,987
Policyholder account balances	$	111,627	Deterministic cash flow model	Projected option cost
Other liabilities	8,360		Black-Scholes model	Expected term
				Forfeiture assumptions
Total liabilities	$	119,987

	December 31, 2014
	Fair Value		Valuation Technique	Unobservable Input
	(In thousands)
Derivatives, index options	$	114,287	Broker prices	Implied volatility
				Inputs from broker proprietary models
Total assets	$	114,287
Policyholder account balances	$	133,236	Deterministic cash flow model	Projected option cost
Other liabilities	9,256		Black-Scholes model	Expected term
				Forfeiture assumptions
Total liabilities	$	142,492

Schedule of Carrying Amounts and Fair Values of Financial Instruments

The carrying amounts and fair values of the Company's financial instruments are as follows:

	March 31, 2015
				Fair Value Hierarchy Level
	Carrying Values		Fair Values	Level 1	Level 2	Level 3
	(In thousands)
ASSETS
Investments in debt and equity securities:
Securities held to maturity	$	7,042,233	7,470,133	—	7,470,133	—
Securities available for sale	2,854,690		2,854,690	17,059	2,837,631	—
Cash and cash equivalents	71,104		71,104	71,104	—	—
Mortgage loans	143,918		150,600	—	—	150,600
Policy loans	63,877		117,948	—	—	117,948
Other loans	2,592		2,792	—	—	2,792
Derivatives, index options	95,987		95,987	—	—	95,987
Short-term investments	14,989		14,989	—	14,989	—
Life interest in Trust	—		12,775	—	—	12,775
LIABILITIES
Deferred annuity contracts	$	7,546,484	7,160,752	—	—	7,160,752
Immediate annuity and supplemental contracts	444,216		477,219	—	—	477,219

	December 31, 2014
				Fair Value Hierarchy Level
	Carrying Values		Fair Values	Level 1	Level 2	Level 3
	(In thousands)
ASSETS
Investments in debt and equity securities:
Securities held to maturity	$	6,841,543	7,175,443	—	7,175,443	—
Securities available for sale	2,728,680		2,728,680	16,862	2,711,818	—
Cash and cash equivalents	277,078		277,078	277,078	—	—
Mortgage loans	149,503		156,548	—	—	156,548
Policy loans	63,645		111,040	—	—	111,040
Other loans	2,171		2,300	—	—	2,300
Derivatives, index options	114,287		114,287	—	—	114,287
Life interest in Trust	—		12,775	—	—	12,775
LIABILITIES
Deferred annuity contracts	$	7,546,504	7,178,535	—	—	7,178,535
Immediate annuity and supplemental contracts	446,458		474,843	—	—	474,843