Investments (Tables)

6 Months Ended

Jun. 30, 2013

Investments [Abstract]

Fixed Maturities and Equity Securities, Available-for-sale Securities

			June 30, 2013
											Other-than-
						Gross		Gross			temporary
			Amortized			Unrealized		Unrealized	Fair		Impairments
			Cost			Gains		Losses	Value		in AOCI (3)
			(in thousands)
Fixed maturities, available-for-sale
U.S. Treasury securities and obligations of U.S.
	government authorities and agencies		$	4,658	$	77	$	-	$	4,735	$	-
Obligations of U.S. states and their political
	subdivisions			96,150		4,675		1,253		99,572		-
Foreign government bonds				30,457		7,232		-		37,689		-
Public utilities				248,897		16,544		3,725		261,716		-
Redeemable preferred stock				-		-		-		-		-
Corporate securities				2,357,358		181,390		15,604		2,523,144		-
Asset-backed securities (1)				182,703		8,286		38		190,951		(1,352)
Commercial mortgage-backed securities				371,503		15,374		5,302		381,575		-
Residential mortgage-backed securities (2)				199,390		6,376		636		205,130		(44)
		Total fixed maturities, available-for-sale	$	3,491,116	$	239,954	$	26,558	$	3,704,512	$	(1,396)
Equity securities, available-for-sale
Common Stocks
	Mutual Funds		$	18	$	2	$	-	$	20
		Total equity securities, available-for-sale	$	18	$	2	$	-	$	20

• Includes credit-tranched securities collateralized by sub-prime mortgages, credit cards, education loans, and other asset types.
• Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.
• Represents the amount of other-than-temporary impairment losses in “AOCI,” which were not included in earnings. Amount excludes $1.7 million of net unrealized gains on impaired securities relating to changes in the value of such securities subsequent to the impairment measurement date.

			December 31, 2012
											Other-than-
						Gross		Gross			temporary
			Amortized			Unrealized		Unrealized	Fair		Impairments
			Cost			Gains		Losses	Value		in AOCI (3)
			(in thousands)
Fixed maturities, available-for-sale
	U.S. Treasury securities and obligations of U.S.
		government authorities and agencies	$	4,568	$	118	$	-	$	4,686	$	-
	Obligations of U.S. states and their political
		subdivisions		95,107		7,359		350		102,116		-
	Foreign government bonds			45,733		9,796		-		55,529		-
	Public utilities			253,566		29,554		569		282,551		-
	Redeemable preferred stock			2,565		697		-		3,262		-
	Corporate securities			2,622,982		283,117		658		2,905,441		-
	Asset-backed securities (1)			179,037		8,772		332		187,477		(3,514)
	Commercial mortgage-backed securities			369,187		25,725		10		394,902		-
	Residential mortgage-backed securities (2)			254,751		12,735		-		267,486		(48)
		Total fixed maturities, available-for-sale	$	3,827,496	$	377,873	$	1,919	$	4,203,450	$	(3,562)
Equity securities, available-for-sale
Common Stocks
	Mutual Funds (4)		$	18	$	4	$	-	$	22
		Total equity securities, available-for-sale	$	18	$	4	$	-	$	22

• Includes credit-tranched securities collateralized by sub-prime mortgages, credit cards, education loans, and other asset types.
• Includes publicly-traded agency pass-through securities and collateralized mortgage obligations.
• Represents the amount of other-than-temporary impairment losses in AOCI, which were not included in earnings. Amount excludes $4.1 million of net unrealized gains on impaired securities relating to changes in the value of such securities subsequent to the impairment measurement date.
• Prior period has been reclassified to conform to the current period presentation.

Investments Classified by Contractual Maturity Date

		Available-for-Sale
		Amortized		Fair
		Cost		Value
		(in thousands)
Due in one year or less		$	890,150	$	913,772
Due after one year through five years			797,842		872,407
Due after five years through ten years			580,012		634,099
Due after ten years			469,516		506,578
Asset-backed securities			182,703		190,951
Commercial mortgage-backed securities			371,503		381,575
Residential mortgage-backed securities			199,390		205,130
	Total	$	3,491,116	$	3,704,512

Sources of Fixed Maturity Proceeds, Related Investment Gains (Losses), and Losses on Impairments of Fixed Maturities and Equity Securities

		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2013		2012		2013		2012
		(in thousands)
Fixed maturities, available-for-sale
	Proceeds from sales	$	6,501	$	33,498	$	121,428	$	316,818
	Proceeds from maturities/repayments		386,663		224,664		593,078		373,805
	Gross investment gains from sales, prepayments, and maturities		4,093		6,894		6,885		14,032
	Gross investment losses from sales and maturities		(17)		(23)		(97)		(24)
Equity securities, available-for-sale
	Proceeds from sales	$	-	$	-	$	1	$	-
	Proceeds from maturities/repayments		-		-		-		-
	Gross investment gains from sales, prepayments, and maturities		(1)		-		-		-
	Gross investment losses from sales and maturities		-		-		-		-
Fixed maturity and equity security impairments
	Net writedowns for other-than-temporary impairment losses
	on fixed maturities recognized in earnings (1)	$	-	$	(83)	$	-	$	(152)
	Writedowns for impairments on equity securities		-		-		-		-

• Excludes the portion of other-than-temporary impairments recorded in “Other comprehensive income (loss),” representing any difference between the fair value of the impaired debt security and the net present value of its projected future cash flows at the time of impairment.

Credit Losses Recognized in Earnings on Fixed Maturity Securities Held by the Company for which a Portion of the OTTI Loss was Recognized in OCI

		Three Months Ended		Six Months Ended
		June 30,		June 30,
		2013		2013
			(in thousands)
Balance, beginning of period		$	1,726	$	3,381
Credit loss impairments previously recognized on securities which matured, paid down,
	prepaid or were sold during the period		(5)		(1,619)
Credit loss impairments previously recognized on securities impaired to fair value during the period			-		-
Credit loss impairment recognized in the current period on securities not previously impaired			-		-
Additional credit loss impairments recognized in the current period on securities previously impaired			-		-
Increases due to the passage of time on previously recorded credit losses			28		55
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected
	to be collected		-		(68)
Balance, end of period		$	1,749	$	1,749
		Three Months Ended		Six Months Ended
		June 30,		June 30,
		2012		2012
			(in thousands)
Balance, beginning of period		$	3,482	$	3,542
Credit loss impairments previously recognized on securities which matured, paid down,
	prepaid or were sold during the period		(113)		(131)
Credit loss impairments previously recognized on securities impaired to fair value during the period			-		-
Credit loss impairment recognized in the current period on securities not previously impaired			-		-
Additional credit loss impairments recognized in the current period on securities previously impaired			83		152
Increases due to the passage of time on previously recorded credit losses			28		51
Accretion of credit loss impairments previously recognized due to an increase in cash flows expected
	to be collected		(93)		(227)
Balance, end of period		$	3,387	$	3,387

Trading Account Assets Disclosure

	June 30, 2013				December 31, 2012
	Amortized		Fair		Amortized		Fair
	Cost		Value		Cost		Value
	(in thousands)
Fixed maturities	$	1,992	$	2,006	$	1,973	$	2,022
Equity securities		4,844		5,917		5,217		5,894
Total trading account assets	$	6,836	$	7,923	$	7,190	$	7,916

Commercial Mortgage and Other Loans

		June 30, 2013				December 31, 2012
			% of				% of
		Amount	Total			Amount	Total
Commercial mortgage and other loans by property type:		(in thousands)				(in thousands)
Office	$	41,505	9.4	%	$	59,074	13.8	%
Retail		73,113	16.6			71,546	16.7
Apartments/Multi-Family		141,170	32.1			120,066	28.0
Industrial		118,515	27.0			114,619	26.7
Hospitality		5,155	1.2			4,621	1.1
Other		10,687	2.4			9,206	2.0
Total commercial mortgage loans		390,145	88.8			379,132	88.3
Agricultural property loans		49,357	11.2			50,026	11.7
Total commercial and agricultural mortgage loans by property type		439,502	100.0	%		429,158	100.0	%
Valuation allowance		(1,809)				(2,177)
Total net commercial and agricultural mortgage loans by property type		437,693				426,981
Other Loans
Uncollateralized loans		2,740				-
Total other loans		2,740				-
Total net other loans		2,740				-
Total commercial mortgage and other loans	$	440,433			$	426,981

Allowance for Losses

	June 30, 2013		December 31, 2012
	(in thousands)
Allowance for losses, beginning of year	$	2,177	$	1,501
Addition to / (release of) allowance for losses		(368)		676
Total ending balance (1)	$	1,809	$	2,177

(1) Agricultural loans represent $0.2million of the ending allowance at bothJune 30, 2013 and December 31, 2012.

Allowance for Credit Losses and Recorded Investment in Commercial Mortgage and Other Loans

	June 30, 2013		December 31, 2012
	Total Loans
	(in thousands)
Allowance for Credit Losses:
Ending balance: individually evaluated for impairment (1)	$	-	$	-
Ending balance: collectively evaluated for impairment (2)		1,809		2,177
Total ending balance	$	1,809	$	2,177
Recorded Investment (3):
Ending balance gross of reserves: individually evaluated for impairment (1)	$	-	$	-
Ending balance gross of reserves: collectively evaluated for impairment (2)		442,242		429,158
Total ending balance, gross of reserves	$	442,242	$	429,158

• There were no agricultural or uncollateralized loans individually evaluated for impairments at June 30, 2013 and December 31, 2012.
• Agricultural loans collectively evaluated for impairment had a recorded investment of $49 million and $50atJune 30, 2013and December 31, 2012, and a related allowance of $0.2 million for both periods. Uncollateralized loans collectively evaluated for impairment had a recorded investment of $3 million at June 30, 2013and $0 million atDecember 31, 2012, respectively, and no related allowance for both periods.
• Recorded investment reflects the balance sheet carrying value gross of related allowance.

Net Investment Income

		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2013		2012		2013		2012
		(in thousands)
Fixed maturities, available-for-sale		$	49,240	$	63,357	$	102,534	$	130,979
Equity securities, available-for-sale			-		7		-		7
Trading account assets			29		370		61		814
Commercial mortgage and other loans			10,274		6,892		16,403		13,714
Policy loans			225		220		339		351
Short-term investments and cash equivalents			96		163		179		363
Other long-term investments			739		177		1,429		915
Gross investment income			60,603		71,186		120,945		147,143
Less investment expenses			(1,669)		(2,009)		(3,471)		(4,073)
	Net investment income	$	58,934	$	69,177	$	117,474	$	143,070

Realized Gain (Loss) on Investments

		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2013		2012			2013	2012
		(in thousands)
Fixed maturities		$	5,096	$	6,790	$	7,808	$	13,857
Equity securities			-		-		1		-
Commercial mortgage and other loans			330		451		368		(105)
Derivatives			(48,839)		27,919		(89,665)		(14,675)
Other			(2)		-		(23)		-
	Realized investment gains (losses), net	$	(43,415)	$	35,160	$	(81,511)	$	(923)

Net Unrealized Investment Gain (Loss) AOCI Rollforward

				Deferred Policy				Accumulated Other
				Acquisition Costs,				Comprehensive
				Deferred Sales				Income (Loss) Related
		Net Unrealized		Inducements		Deferred		To Net Unrealized
		Gains (Losses) on		and Valuation of		Income Tax		Investment
		Investments		Business Acquired		(Liability) Benefit		Gains (Losses)
		(in thousands)
Balance, December 31, 2012		$	545	$	(214)	$	(100)	$	231
Net investment (losses) gains on investments arising during
	the period		562		-		(197)		365
Reclassification adjustment for gains (losses) included in
	net income		(762)		-		267		(495)
Impact of net unrealized investment (losses) gains on
	deferred policy acquisition costs, deferred sales inducements and
	valuation of business acquired		-		86		(30)		56
Balance, June 30, 2013		$	345	$	(128)	$	(60)	$	157

All Other Net Unrealized Investment Gain (Loss) AOCI Rollforward

				Deferred Policy						Accumulated Other
				Acquisition Costs,						Comprehensive
				Deferred Sales				Deferred		Income (Loss) Related
		Net Unrealized		Inducements			Future	Income Tax		To Net Unrealized
		Gains/(Losses) on		and Valuation of			Policy	(Liability)		Investment
		Investments (1)		Business Acquired			Benefits	Benefit		Gains (Losses)
		(in thousands)
Balance, December 31, 2012		$	376,777	$	(147,089)	$	(2,164)	$	(80,468)	$	147,056
Net investment gains (losses) on investments arising during
	the period		(154,012)		-		-		53,905		(100,107)
Reclassification adjustment for (losses) gains included in
	net income		(7,047)		-		-		2,467		(4,580)
Impact of net unrealized investment (losses) gains on
	deferred policy acquisition costs, deferred sales inducements
	and valuation of business acquired		-		68,555		-		(23,993)		44,562
Impact of net unrealized investment (gains) losses on
	future policy benefits		-		-		(8,049)		2,804		(5,245)
Balance, June 30, 2013		$	215,718	$	(78,534)	$	(10,213)	$	(45,285)	$	81,686

• Includes cash flow hedges. See Note 5 for additional discussion of our cash flow hedges.

Unrealized Gains and (Losses) on Investments

	June 30, 2013		December 31, 2012
	(in thousands)
Fixed maturity securities on which an OTTI loss has been recognized	$	345	$	545
Fixed maturity securities, available-for-sale - all other		213,051		375,409
Equity securities, available-for-sale		2		4
Affiliated notes		3,460		4,386
Derivatives designated as cash flow hedges (1)		(725)		(3,068)
Other investments		(70)		46
Unrealized gains (losses) on investments and derivatives	$	216,063	$	377,322
(1) See Note 5 for more information on cash flow hedges.

Duration Of Gross Unrealized Losses On Fixed Maturity Securities Disclosures

			June 30, 2013
			Less than twelve months				Twelve months or more				Total
			Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
			(in thousands)
Fixed maturities, available-for-sale
Obligations of U.S. States and their
	political subdivisions		$	12,180	$	1,253	$	-	$	-	$	12,180	$	1,253
Corporate securities				426,185		18,493		5,560		836		431,745		19,329
Commercial mortgage-backed securities				61,307		5,302		118		-		61,425		5,302
Asset-backed securities				15,054		38		-		-		15,054		38
Residential mortgage-backed securities				43,304		636		-		-		43,304		636
		Total	$	558,030	$	25,722	$	5,678	$	836	$	563,708	$	26,558
Equity securities, available-for-sale			$	-	$	-	$	-	$	-	$	-	$	-

			December 31, 2012
			Less than twelve months				Twelve months or more				Total
			Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
			(in thousands)
Fixed maturities, available-for-sale
Obligations of U.S. States and their political
	subdivisions		$	7,090	$	350	$	-	$	-	$	7,090	$	350
Corporate securities				35,248		897		14,867		330		50,115		1,227
Commercial mortgage-backed securities				3,326		10		-		-		3,326		10
Asset-backed securities				13,817		42		2,994		290		16,811		332
Residential mortgage-backed securities				-		-		-		-		-		-
		Total	$	59,481	$	1,299	$	17,861	$	620	$	77,342	$	1,919
Equity securities, available-for-sale			$	-	$	-	$	-	$	-	$	-	$	-

Reclassifications Out Of Accumulated Other Comprehensive Income

Reclassifications out of Accumulated Other Comprehensive Income (Loss) ("AOCI")
	Three Months Ended		Six Months Ended
	June 30, 2013		June 30, 2013
	(in thousands)
Amounts reclassified from AOCI (1)(2):
Net unrealized investment gains (losses):
Cash flow hedges - Currency/Interest rate (3)	$	11	$	(18)
Net unrealized investment gains (losses) on available-for-sale securities		5,085		7,827
Total net unrealized investment gains (losses) (4)		5,096		7,809
Total reclassifications for the period	$	5,096	$	7,809

• All amounts are shown before tax.
• Positive amounts indicate gains/benefits reclassified out of AOCI. Negative amounts indicate losses/costs reclassified out of AOCI.
• See Note 5for additional information on cash flow hedges.
• See table below for additional information on unrealized investment gains (losses), including the impact on deferred policy acquisition and other costs, future policy benefits and policyholders' dividends.

Accumulated Other Comprehensive Income Loss Table

	Accumulated Other Comprehensive Income (Loss)
		Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses) (1)		Total Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance, December 31, 2012	$	7	$	147,280	$	147,287
Change in other comprehensive income
before reclassifications		(15)		(92,858)		(92,873)
Amounts reclassified from AOCI		-		(7,809)		(7,809)
Income tax benefit (expense)		5		35,233		35,238
Balance, June 30, 2013	$	(3)	$	81,846	$	81,843
	Accumulated Other Comprehensive Income (Loss)
		Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses) (1)		Total Accumulated Other Comprehensive Income (Loss)
	(in thousands)
Balance, December 31, 2011	$	-	$	160,712	$	160,712
Change in component during period (2)		(13)		(12,162)		(12,175)
Balance, June 30, 2012	$	(13)	$	148,550	$	148,537

• Includes cash flow hedges of($1) million and ($3) million as of June 30, 2013 and December 31, 2012, respectively, and $0 million and ($1) million as of June 30, 2012 and December 31, 2011, respectively.
• All amounts are shown net of taxes.