Investments (Tables)

9 Months Ended

Sep. 30, 2014

Amortized Cost or Cost and Fair Value of Available For Sale Securities

The amortized cost or cost and the fair value of AFS securities as of September 30, 2014 and December 31, 2013 are summarized as follows:

	Amortized Cost or Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in millions)
As of September 30, 2014
Equity securities:
Common stock	$	2,480.2	$	462.4	$	(47.3	)	$	2,895.3
Preferred stock		—		—		—			—
Total equity securities		2,480.2		462.4		(47.3	)		2,895.3
Debt securities:
U.S. Government obligations		377.3		1.9		(1.5	)		377.7
Municipal bonds		5,312.9		130.2		(13.6	)		5,429.5
Foreign government obligations		896.6		14.5		(0.6	)		910.5
U.S. corporate bonds		2,296.6		38.9		(15.0	)		2,320.5
Foreign corporate bonds		1,573.1		42.4		(1.8	)		1,613.7
Mortgage and asset-backed securities:
RMBS		1,646.4		32.7		(23.5	)		1,655.6
CMBS		1,125.3		15.3		(4.7	)		1,135.9
Other asset-backed securities(1)		1,328.6		2.5		(8.3	)		1,322.8
Total debt securities		14,556.8		278.4		(69.0	)		14,766.2
Short-term investments		792.0		—		—			792.0
Total	$	17,829.0	$	740.8	$	(116.3	)	$	18,453.5

	Amortized Cost or Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
	(in millions)
As of December 31, 2013
Equity securities:
Common stock	$	1,804.7	$	426.6	$	(1.9	)	$	2,229.4
Preferred stock		—		—		—			—
Total equity securities		1,804.7		426.6		(1.9	)		2,229.4
Debt securities:
U.S. Government obligations		982.1		3.0		(30.1	)		955.0
Municipal bonds		5,650.5		51.7		(112.1	)		5,590.1
Foreign government obligations		979.3		4.6		(8.5	)		975.4
U.S. corporate bonds		2,307.2		29.4		(23.7	)		2,312.9
Foreign corporate bonds		1,810.6		27.0		(5.9	)		1,831.7
Mortgage and asset-backed securities:
RMBS		1,559.5		36.1		(47.8	)		1,547.8
CMBS		881.6		12.8		(8.8	)		885.6
Other asset-backed securities(1)		705.0		1.7		(2.3	)		704.4
Total debt securities		14,875.8		166.3		(239.2	)		14,802.9
Short-term investments		1,317.9		—		—			1,317.9
Total	$	17,998.4	$	592.9	$	(241.1	)	$	18,350.2

(1) Includes $887.5 million and $237.9 million of collateralized loan obligations as of September 30, 2014 and December 31, 2013, respectively.

Amortized Cost and Estimated Fair Value of Debt Securities by Contractual Maturity

The amortized cost and estimated fair value of debt securities as of September 30, 2014 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	Amortized Cost or Cost		Fair Value
	(in millions)
Short-term investments due in one year or less	$	792.0	$	792.0
Mortgage and asset-backed securities(1)		4,100.3		4,114.3
Debt securities with maturity dates:
One year or less		726.0		730.0
Over one through five years		3,406.9		3,448.7
Over five through ten years		3,012.3		3,077.8
Over ten years		3,311.3		3,395.4
Total debt securities		14,556.8		14,766.2
Equity securities		2,480.2		2,895.3
Total	$	17,829.0	$	18,453.5

(1) Mortgage and asset-backed securities by their nature do not generally have single maturity dates.

Net Investment Income

Net investment income for the three and nine months ended September 30, 2014 and 2013 was as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in millions)
Interest income	$	96.2		$	88.4		$	288.9		$	257.7
Dividend income		15.8			13.3			46.0			41.1
Investment expenses		(7.2	)		(5.3	)		(21.6	)		(15.6	)
Equity in results of Homesite(1)		—			7.7			—			32.2
Equity in results of ORX		0.1			(2.3	)		(0.6	)		(1.9	)
Equity in results of Pillar Investments(2)		5.0			9.4			12.5			13.7
Equity in results of Ares(2)		2.7			2.9			5.8			2.9
Other investment results		5.7			1.2			12.0			4.4
Total	$	118.3		$	115.3		$	343.0		$	334.5

(1) Homesite was sold on December 31, 2013.

(2) See Note 3(g) for discussion of the Pillar Investments and the investment in Ares.

Amount of Gross Realized Capital Gains and Gross Realized Capital Losses of Available For Sale Securities

The amounts of gross realized capital gains and gross realized capital losses were as follows:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2014			2013			2014			2013
	(in millions)
Gross realized capital gains	$	61.6		$	63.7		$	215.4		$	165.5
Gross realized capital losses		(2.2	)		(45.9	)		(17.7	)		(69.9	)
Net realized capital gains	$	59.4		$	17.8		$	197.7		$	95.6

Gross Unrealized Losses and Related Fair Values for Debt Securities and Equity Securities Grouped by Duration of Time in Continuous Unrealized Loss Position

As of September 30, 2014 and December 31, 2013, gross unrealized losses and related fair values for equity securities and debt securities, grouped by duration of time in a continuous unrealized loss position, were as follows:

	Less Than 12 Months				12 Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
	(in millions)
As of September 30, 2014
Equity securities:
Common stock	$	553.6	$	47.3	$	—	$	—	$	553.6	$	47.3
Preferred stock		—		—		—		—		—		—
Total equity securities		553.6		47.3		—		—		553.6		47.3
Debt securities:
U.S. Government obligations		126.4		0.6		30.0		0.9		156.4		1.5
Municipal bonds		133.0		0.7		651.6		12.9		784.6		13.6
Foreign government obligations		78.6		0.3		39.0		0.3		117.6		0.6
U.S. corporate bonds		743.4		9.7		174.2		5.3		917.6		15.0
Foreign corporate bonds		114.2		1.2		53.6		0.6		167.8		1.8
Mortgage and asset-backed securities:
RMBS		332.0		1.4		648.8		22.1		980.8		23.5
CMBS		331.4		2.3		118.6		2.4		450.0		4.7
Other asset-backed securities		776.7		7.5		84.8		0.8		861.5		8.3
Total debt securities		2,635.7		23.7		1,800.6		45.3		4,436.3		69.0
Total temporarily impaired securities	$	3,189.3	$	71.0	$	1,800.6	$	45.3	$	4,989.9	$	116.3

	Less Than 12 Months				12 Months or More				Total
	Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses
					(in millions)
As of December 31, 2013
Equity securities:
Common stock	$	148.7	$	1.9	$	—	$	—	$	148.7	$	1.9
Preferred stock		—		—		—		—		—		—
Total equity securities		148.7		1.9		—		—		148.7		1.9
Debt securities:
U.S. Government obligations		698.9		29.6		4.8		0.5		703.7		30.1
Municipal bonds		2,426.2		105.2		117.8		6.9		2,544.0		112.1
Foreign government obligations		625.6		8.2		8.8		0.3		634.4		8.5
U.S. corporate bonds		920.0		21.1		34.2		2.6		954.2		23.7
Foreign corporate bonds		528.3		5.8		4.9		0.1		533.2		5.9
Mortgage and asset-backed securities:
RMBS		779.4		30.7		267.9		17.1		1,047.3		47.8
CMBS		375.2		8.5		16.9		0.3		392.1		8.8
Other asset-backed securities		461.0		2.3		—		—		461.0		2.3
Total debt securities		6,814.6		211.4		455.3		27.8		7,269.9		239.2
Total temporarily impaired securities	$	6,963.3	$	213.3	$	455.3	$	27.8	$	7,418.6	$	241.1