Accumulated Other Comprehensive Income (Loss)

9 Months Ended

Sep. 30, 2013

Comprehensive Income Loss Note [Abstract]

Accumulated Other Comprehensive Income (Loss)

The changes in AOCI, net of tax, by component for the three months ended September 30, 2013 are as follows:

Three months ended September 30, 2013 (U.S. dollars in thousands)	Unrealized Gains (Losses) on Investments			OTTI Losses Recognized in AOCI			Foreign Currency Translation Adjustments		Underfunded Pension Liability			Cash Flow Hedge		Total
Balance, beginning of period, net of tax (1)	$	796,073		$	(101,751	)	$	41,755	$	(27,211	)	$	1,894	$	710,760
OCI before reclassifications (2)	121,956			—			4,020		1,092			—		127,068
Amounts reclassified from AOCI	(5,516		)	7,474			—		—			110		2,068
Tax (benefit) expense	(77,575		)	(5		)	—		—			—		(77,580		)
Net current period OCI - net of tax	38,865			7,469			4,020		1,092			110		51,556
Balance, end of period, net of tax	$	834,938		$	(94,282	)	$	45,775	$	(26,119	)	$	2,004	$	762,316

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(1) Amounts include adjustments recorded to the value of future policy benefit reserves of $32.9 million. These amounts were recorded during the three months ended June 30, 2013.

(2) Amounts include adjustments recorded to the value of future policy benefit reserves of $37.4 million. These amounts were recorded during the three months ended September 30, 2013.

The changes in AOCI, net of tax, by component for the nine months ended September 30, 2013 are as follows:

Nine months ended September 30, 2013 (U.S. dollars in thousands)	Unrealized Gains (Losses) on Investments (1)			OTTI Losses Recognized in AOCI			Foreign Currency Translation Adjustments			Underfunded Pension Liability			Cash Flow Hedge		Total
Balance, beginning of period, net of tax	$	1,597,832		$	(121,371	)	$	69,391		$	(27,506	)	$	1,674	$	1,520,020
OCI before reclassifications (1)	(667,097		)	—			(23,616		)	1,387			—		(689,326		)
Amounts reclassified from AOCI	(102,619		)	27,099			—			—			330		(75,190		)
Tax (benefit) expense	6,822			(10		)	—			—			—		6,812
Net current period OCI - net of tax	(762,894		)	27,089			(23,616		)	1,387			330		(757,704		)
Balance, end of period, net of tax	$	834,938		$	(94,282	)	$	45,775		$	(26,119	)	$	2,004	$	762,316

____________

(1) Amounts include cumulative adjustments recorded to the value of future policy benefit reserves of $70.3 million. These amounts were recorded during the nine months ended September 30, 2013.

The reclassifications out of AOCI along with the associated income statement line items affected by component, and the total related tax (expense) benefit for the three and nine months ended September 30, 2013 and 2012 are as follows:

Gross Amount Reclassified From AOCI
Details About AOCI Components (U.S. dollars in thousands)	Three months ended September 30, 2013			Nine months ended September 30, 2013			Affected Line Item in the Statement of Income
Unrealized gains and losses on investments:
	$	(7,904	)	$	(110,295	)	Net realized gains (losses) on investments sold
	2,388			7,676			OTTI on investments
	$	(5,516	)	$	(102,619	)	Total before tax
	3,352			66			Provision (benefit) for income tax
	$	(2,164	)	$	(102,553	)	Net of tax
OTTI losses recognized in OCI:
	$	6,675		$	24,562		Net realized gains (losses) on investments sold
	799			2,537			OTTI on investments transferred to (from) OCI
	$	7,474		$	27,099		Total before tax
	(5		)	(10		)	Provision (benefit) for income tax
	$	7,469		$	27,089		Net of tax
Gains and losses on cash flow hedges:
Interest rate contracts	$	110		$	330		Interest Expense
	—			—			Provision (benefit) for income tax
	$	110		$	330		Net of tax
Total reclassifications for the period, gross of tax	$	2,068		$	(75,190	)
Tax (benefit) expense	3,347			56
Total reclassifications for the period, net of tax	$	5,415		$	(75,134	)