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Accumulated Other Comprehensive Income (Loss)
 6 Months Ended
Jun. 30, 2014
Comprehensive Income Loss Note [Abstract]  
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss)
The changes in AOCI, net of tax, by component for the three and six months ended June 30, 2014 and 2013 are as follows:
Three months ended June 30, 2014
(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
$
1,032,941

 
$
(85,894
)
 
$
10,661

 
$
(13,270
)
 
$
2,223

 
$
946,661

OCI before reclassifications
363,348

 
—

 
(3,621
)
 
(8
)
 
—

 
359,719

Amounts reclassified from AOCI
(74,337
)
 
1,640

 
—

 
—

 
110

 
(72,587
)
Tax benefit (expense)
(20,774
)
 
(4
)
 
(5,981
)
 
—

 
—

 
(26,759
)
Net current period OCI - net of tax
268,237

 
1,636

 
(9,602
)
 
(8
)
 
110

 
260,373

Balance, end of period, net of tax
$
1,301,178

 
$
(84,258
)
 
$
1,059

 
$
(13,278
)
 
$
2,333

 
$
1,207,034

 
 
 
 
 
 
 
 
 
 
 
 
Three months ended June 30, 2013
(U.S. dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period, net of tax
$
1,474,553

 
$
(116,189
)
 
$
65,480

 
$
(20,506
)
 
$
1,784

 
$
1,405,122

OCI before reclassifications
(701,365
)
 
—

 
(25,524
)
 
(91
)
 
—

 
(726,980
)
Amounts reclassified from AOCI
(55,408
)
 
14,440

 
—

 
—

 
110

 
(40,858
)
Tax benefit (expense)
71,671

 
(2
)
 
1,806

 
—

 
—

 
73,475

Net current period OCI - net of tax
(685,102
)
 
14,438

 
(23,718
)
 
(91
)
 
110

 
(694,363
)
Balance, end of period, net of tax
$
789,451

 
$
(101,751
)
 
$
41,762

 
$
(20,597
)
 
$
1,894

 
$
710,759

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2014
(U.S. dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period, net of tax
$
822,432

 
$
(89,190
)
 
$
14,541

 
$
(13,239
)
 
$
2,113

 
$
736,657

OCI before reclassifications
628,599

 
—

 
(9,521
)
 
(39
)
 
—

 
619,039

Amounts reclassified from AOCI
(96,975
)
 
5,049

 
—

 
—

 
220

 
(91,706
)
Tax benefit (expense)
(52,878
)
 
(117
)
 
(3,961
)
 
—

 
—

 
(56,956
)
Net current period OCI - net of tax
478,746

 
4,932

 
(13,482
)
 
(39
)
 
220

 
470,377

Balance, end of period, net of tax
$
1,301,178

 
$
(84,258
)
 
$
1,059

 
$
(13,278
)
 
$
2,333

 
$
1,207,034

 
 
 
 
 
 
 
 
 
 
 
 
Six months ended June 30, 2013
(U.S. dollars in thousands)
 
 
 
 
 
 
 
 
 
 
 
Balance, beginning of period, net of tax
$
1,591,210

 
$
(121,371
)
 
$
69,399

 
$
(20,892
)
 
$
1,674

 
$
1,520,020

OCI before reclassifications
(789,054
)
 
—

 
(30,576
)
 
295

 
—

 
(819,335
)
Amounts reclassified from AOCI
(97,102
)
 
19,625

 
—

 
—

 
220

 
(77,257
)
Tax benefit (expense)
84,397

 
(5
)
 
2,939

 
—

 
—

 
87,331

Net current period OCI - net of tax
(801,759
)
 
19,620

 
(27,637
)
 
295

 
220

 
(809,261
)
Balance, end of period, net of tax
$
789,451

 
$
(101,751
)
 
$
41,762

 
$
(20,597
)
 
$
1,894

 
$
710,759


____________
(1)
Included in these amounts are the impact of Shadow Adjustments. During the year ended December 31, 2013, the initial impact of $44.7 million was recorded. During the six months ended June 30, 2014, additional impacts of $474.5 million were recorded, resulting in a total cumulative impact of shadow adjustments on future policy benefit reserves of $519.2 million at June 30, 2014.
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 six months ended June 30, 2014 and 2013 are as follows:
Gross Amount Reclassified From AOCI
Details About AOCI Components
(U.S. dollars in thousands)
Three months ended June 30, 2014
 
Three months ended June 30, 2013
 
Six months ended June 30, 2014
 
Six months ended June 30, 2013
 
Affected Line Item in the Statement of Income
Unrealized gains and losses on investments:
 
 
 
 
 
 
 
 
 
 
$
(107,470
)
 
$
(56,969
)
 
$
(132,384
)
 
$
(102,391
)
 
Net realized gains (losses) on investments sold
 
33,133

 
1,561

 
35,409

 
5,289

 
OTTI on investments
 
$
(74,337
)
 
$
(55,408
)
 
$
(96,975
)
 
$
(97,102
)
 
Total before tax
 
1,477

 
(3,560
)
 
1,930

 
(3,286
)
 
Provision (benefit) for income tax
 
$
(72,860
)
 
$
(58,968
)
 
$
(95,045
)
 
$
(100,388
)
 
Net of tax
OTTI losses recognized in OCI:
 
 
 
 
 
 
 
 
 
 
$
1,386

 
$
13,612

 
$
3,344

 
$
17,887

 
Net realized gains (losses) on investments sold
 
254

 
828

 
1,705

 
1,738

 
OTTI on investments transferred to (from) OCI
 
$
1,640

 
$
14,440

 
$
5,049

 
$
19,625

 
Total before tax
 
(4
)
 
(2
)
 
(117
)
 
(5
)
 
Provision (benefit) for income tax
 
$
1,636

 
$
14,438

 
$
4,932

 
$
19,620

 
Net of tax
Gains and losses on cash flow hedges:
 
 
 
 
 
 
 
 
 
     Interest rate contracts
$
110

 
$
110

 
$
220

 
$
220

 
Interest Expense
 
—

 
—

 
—

 
—

 
Provision (benefit) for income tax
 
$
110

 
$
110

 
$
220

 
$
220

 
Net of tax
 
 
 
 
 
 
 
 
 
 
Total reclassifications for the period, gross of tax
$
(72,587
)
 
$
(40,858
)
 
$
(91,706
)
 
$
(77,257
)
 
 
Tax benefit (expense)
1,473

 
(3,562
)
 
1,813

 
(3,291
)
 
 
Total reclassifications for the period, net of tax
$
(71,114
)
 
$
(44,420
)
 
$
(89,893
)
 
$
(80,548
)