Fair Value of Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value of Assets and Liabilities [Abstract]

Fair Value, Assets and Liabilities Measured on Recurring Basis

		As of June 30, 2013
		Level 1		Level 2		Level 3			Netting (2)	Total
		(in thousands)
Fixed maturities, available-for-sale:
	U.S Treasury securities and obligations of U.S. government authorities and agencies	$	-	$	4,735	$	-	$	-	$	4,735
	Obligations of U.S. states and their political subdivisions		-		99,572		-		-		99,572
	Foreign government bonds		-		37,689		-		-		37,689
	Corporate securities		-		2,688,668		96,192		-		2,784,860
	Asset-backed securities		-		104,865		86,086		-		190,951
	Commercial mortgage-backed securities		-		381,575		-		-		381,575
	Residential mortgage-backed securities		-		205,130		-		-		205,130
Sub-total			-		3,522,234		182,278		-		3,704,512
Trading account assets:
	Asset-backed securities		-		2,006		-		-		2,006
	Equity securities		5,638		-		279		-		5,917
Sub-total			5,638		2,006		279		-		7,923
Equity securities, available-for-sale			-		20		-		-		20
Short-term investments			245,804		1,259		-		-		247,063
Cash equivalents			1		-		-		-		1
Other long-term investments			-		105,439		407		(75,568)		30,278
Reinsurance recoverables			-		-		654,058		-		654,058
Receivables from parent and affiliates			-		19,706		5,250		-		24,956
Sub-total excluding separate account assets			251,443		3,650,664		842,272		(75,568)		4,668,811
Separate account assets (1)			124,735		44,054,999		-		-		44,179,734
Total assets		$	376,178	$	47,705,663	$	842,272	$	(75,568)	$	48,848,545
Future policy benefits		$	-	$	-	$	669,989	$	-	$	669,989
Other liabilities			-		75,568		-		(75,568)		-
Total liabilities		$	-	$	75,568	$	669,989	$	(75,568)	$	669,989

		As of December 31, 2012
		Level 1		Level 2		Level 3			Netting (2)	Total
		(in thousands)
Fixed maturities, available-for-sale:
	U.S Treasury securities and obligations of U.S. government authorities and agencies	$	-	$	4,686	$	-	$	-	$	4,686
	Obligations of U.S. states and their political subdivisions		-		102,116		-		-		102,116
	Foreign government securities		-		55,529		-		-		55,529
	Corporate securities		-		3,095,699		95,555		-		3,191,254
	Asset-backed securities		-		118,179		69,298		-		187,477
	Commercial mortgage-backed securities		-		394,902		-		-		394,902
	Residential mortgage-backed securities		-		267,486		-		-		267,486
Sub-total			-		4,038,597		164,853		-		4,203,450
Trading account assets:
	Asset-backed securities		-		2,022		-		-		2,022
	Equity securities		5,687		-		207		-		5,894
Sub-total			5,687		2,022		207		-		7,916
Equity securities, available-for-sale			-		22		-		-		22
Short-term investments			103,761		-		-		-		103,761
Cash equivalents			-		-		-		-		-
Other long-term investments			-		173,348		1,054		(42,351)		132,051
Reinsurance recoverables			-		-		1,732,094		-		1,732,094
Receivables from parent and affiliates			-		20,632		1,995		-		22,627
Sub-total excluding separate account assets			109,448		4,234,621		1,900,203		(42,351)		6,201,921
Separate account assets (1)			122,142		44,479,578		-		-		44,601,720
Total assets		$	231,590	$	48,714,199	$	1,900,203	$	(42,351)	$	50,803,641
Future policy benefits		$	-	$	-	$	1,793,137	$	-	$	1,793,137
Other liabilities			-		42,351		-		(42,351)		-
Total liabilities		$	-	$	42,351	$	1,793,137	$	(42,351)	$	1,793,137

• Separate account assets represent segregated funds that are invested for certain customers. Investment risks associated with market value changes are borne by the customers, except to the extent of minimum guarantees made by the Company with respect to certain accounts.Separate account liabilities are not included in the above table as they are reported at contract value and not fair value in the Company's Unaudited InterimStatements of Financial Position.
• “Netting” amounts represent the impact of offsetting asset and liability positions held with the same counterparty.

Fair Value, Assets and Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation

				Three Months Ended June 30, 2013
				Fixed Maturities Available-For-Sale							Trading Account Assets - Equity Securities
				Corporate Securities		Asset- Backed Securities			Commercial Mortgage-Backed				Other Long Term Investments
				(in thousands)
Fair Value, beginning of period assets/(liabilities)				$	95,575	$	72,740	$	9,106	$	267	$	463
		Included in earnings:
			Realized investment gains (losses), net		45		-		1		-		(97)
			Asset management fees and other income		-		-		-		12		4
		Included in other comprehensive income (loss)			(3,789)		(151)		-		-		-
	Net investment income				1,176		181		-		-		-
	Purchases				643		18,922		-		-		37
	Sales				-		-		-		-		-
	Issuances				-		-		-		-		-
	Settlements				(2,434)		(5,606)		-		-		-
	Transfers into Level 3 (1)				4,976		-		-		-		-
	Transfers out of Level 3 (1)				-		-		(9,107)		-		-
Fair Value, end of period assets/(liabilities)				$	96,192	$	86,086	$	-	$	279	$	407
Unrealized gains (losses) for the period relating to those
	Level 3 assets that were still held at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net	$	-	$	-	$	-	$	-	$	(97)
			Asset management fees and other income	$	-	$	-	$	-	$	11	$	4
				Three Months Ended June 30, 2013
				Reinsurance Recoverables		Receivables from parent and affiliates		Future Policy Benefits
				(in thousands)
Fair Value, beginning of period assets/(liabilities)				$	1,191,409	$	2,000	$	(1,230,323)
	Total gains (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net		(596,967)		-		622,798
			Asset management fees and other income		-		-		-
		Included in other comprehensive income (loss)			-		(4)		-
	Net investment income				-		-		-
	Purchases				59,616		3,254		-
	Sales				-		-		-
	Issuances				-		-		(62,464)
	Settlements				-		-		-
	Transfers into Level 3 (1)				-		-		-
	Transfers out of Level 3 (1)				-		-		-
Fair Value, end of period assets/(liabilities)				$	654,058	$	5,250	$	(669,989)
					.		.
Unrealized gains (losses) for the period relating to those
	Level 3 assets that were still held at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net	$	(588,372)	$	-	$	614,035
			Asset management fees and other income	$	-	$	-	$	-

				Six Months Ended June 30, 2013
				Fixed Maturities Available-For-Sale							Trading Account Assets - Equity Securities
				Corporate Securities		Asset- Backed Securities			Commercial Mortgage-Backed				Other Long Term Investments
				(in thousands)
Fair Value, beginning of period assets/(liabilities)				$	95,555	$	69,298	$	-	$	207	$	1,054
	Total gains (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net		49		-		-		-		(721)
			Asset management fees and other income		-		-		-		72		37
		Included in other comprehensive income (loss)			(4,060)		11		17		-		-
	Net investment income				2,330		316		-		-		-
	Purchases				1,243		25,980		9,090		-		37
	Sales				-		-		-		-		-
	Issuances				-		-		-		-		-
	Settlements				(3,901)		(9,519)		-		-		-
	Transfers into Level 3 (1)				4,976		-		-		-		-
	Transfers out of Level 3 (1)				-		-		(9,107)		-		-
Fair Value, end of period assets/(liabilities)				$	96,192	$	86,086	$	-	$	279	$	407
Unrealized gains (losses) for the period relating to those
	Level 3 assets that were still held at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net	$	-	$	-	$	-	$	-	$	(721)
			Asset management fees and other income	$	-	$	-	$	-	$	72	$	37
				Six Months Ended June 30, 2013
				Reinsurance Recoverables		Receivables from parent and affiliates		Future Policy Benefits
				(in thousands)
Fair Value, beginning of period assets/(liabilities)				$	1,732,094	$	1,995	$	(1,793,136)
	Total gains (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net		(1,195,788)		-		1,246,584
			Asset management fees and other income		-		-		-
		Included in other comprehensive income (loss)			-		1		-
	Net investment income				-		-		-
	Purchases				117,752		3,254		-
	Sales				-		-		-
	Issuances				-		-		(123,437)
	Settlements				-		-		-
	Transfers into Level 3 (1)				-		-		-
	Transfers out of Level 3 (1)				-		-		-
Fair Value, end of period assets/(liabilities)				$	654,058	$	5,250	$	(669,989)
					.
Unrealized gains (losses) for the period relating to those
	Level 3 assets that were still held at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net	$	(1,173,117)	$	-	$	1,223,615
			Asset management fees and other income	$	-	$	-	$	-

					Three Months Ended June 30, 2012
					Fixed Maturities Available-For-Sale - Corporate Securities		Fixed Maturities Available-For-Sale - Asset Backed Securities		Other Trading Securities - Equity Unaffiliated			Other Long-Term Investments		Reinsurance Recoverables
					(in thousands)
Fair Value, beginning of period assets/(liabilities)					$	103,130	$	46,700	$	201	$	256	$	1,205,262
	Total gains or (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net			2		-		-		-		500,397
			Asset management fees and other income			-		-		(4)		(11)		-
		Included in other comprehensive income (loss)				1,596		91		-		-		-
	Net investment income					1,149		193		-		-		-
	Purchases					2,775		7,500		-		60		55,615
	Sales					(29)		-		-		-		-
	Issuances					(2,775)		-		-		-		-
	Settlements					(1,697)		(2,718)		-		-		-
	Transfers into Level 3 (1)					1		-		-		-		-
	Transfers out of Level 3 (1)					(11,691)		-		-		-		-
Fair Value, end of period assets/(liabilities)					$	92,461	$	51,766	$	197	$	305	$	1,761,274
Unrealized gains (losses) for the period relating to
	those Level 3 assets that were still held
	at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net		$	-	$	-	$	-	$	874	$	513,151
			Asset management fees and other income		$	-	$	-	$	(5)	$	(11)	$	-
				Three Months Ended June 30, 2012
				Future Policy Benefits
				(in thousands)
Fair Value, beginning of period assets/(liabilities)					$	(1,220,550)
	Total gains or (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net			(516,861)
			Asset management fees and other income			-
			Included in other comprehensive income (loss)			-
		Net investment income				-
		Purchases				-
		Sales				-
		Issuances				(58,304)
		Settlements				-
		Transfers into Level 3 (1)				-
		Transfers out of Level 3 (1)				-
Fair Value, end of period assets/(liabilities)					$	(1,795,715)
Unrealized gains (losses) for the period relating to
	those Level 3 assets that were still held
	at the end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net		$	(529,720)

					Six Months Ended June 30, 2012
					Fixed Maturities Available-For-Sale -Corporate Securities			Fixed Maturities Available-For-Sale - Asset Backed Securities		Trading Account Assets - Equity Securities		Other Long-Term Investments		Reinsurance Recoverable
					(in thousands)
Fair Value, beginning of period assets/(liabilities)					$	89,658	$	48,563	$	203	$	1,213	$	1,747,757
	Total gains or (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net			9		-		-		(977)		(97,855)
			Asset management fees and other income			-		-		(6)		2		-
		Included in other comprehensive income (loss)				740		953		-		-		-
	Net investment income					2,377		351		-		-		-
	Purchases					5,400		7,500		-		60		111,372
	Sales					(29)		-		-		-		-
	Issuances					-		-		-		-		-
	Settlements					(5,995)		(5,601)		-		7		-
	Transfers into Level 3 (1)					11,992		-		-		-		-
	Transfers out of Level 3 (1)					(11,691)		-		-		-		-
Fair Value, end of period assets/(liabilities)					$	92,461	$	51,766	$	197	$	305	$	1,761,274
Unrealized gains (losses) for the period relating to those
	Level 3 assets that were still held at the
	end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net		$	-	$	-	$	-	$	-	$	(71,947)
			Asset management fees and other income		$	-	$	-	$	(6)	$	2	$	-
				Six Months Ended June 30, 2012
				Future Policy Benefits
				(in thousands)
Fair Value, beginning of period assets/(liabilities)					$	(1,783,595)
	Total gains or (losses) (realized/unrealized):
		Included in earnings:
			Realized investment gains (losses), net			104,631
			Asset management fees and other income			-
		Included in other comprehensive income (loss)				-
	Net investment income					-
	Purchases					-
	Sales					-
	Issuances					(116,751)
	Settlements					-
	Transfers into Level 3 (1)					-
	Transfers out of Level 3 (1)					-
Fair Value, end of period assets/(liabilities)					$	(1,795,715)
Unrealized gains (losses) for the period relating to
	Level 3 assets that were still held at the
	end of the period (2):
		Included in earnings:
			Realized investment gains (losses), net		$	78,346

(1) Transfers into or out of Level 3 are generally reported as the value as of the beginning of the quarter in which the transfer occurs.

(2) Unrealized gains or losses related to assets still held at the end of the period do not include amortization or accretion of premiums and discounts.

Fair Value Disclosure Financial Instruments Not Carried at Fair Value

				June 30, 2013										December 31, 2012
				Fair Value								Carrying Amount (1)		Fair Value		Carrying Amount
				Level 1		Level 2		Level 3		Total		Total		Total		Total
			(in thousands)
Assets:
	Commercial mortgage and other loans		$	-	$	2,676	$	468,216	$	470,892	$	440,433	$	473,964	$	426,981
	Policy loans			-		-		12,554		12,554		12,554		11,957		11,957
	Cash			252		-		-		252		252		266		266
	Accrued investment income			-		39,762		-		39,762		39,762		44,656		44,656
	Receivables from parent and affiliates			-		6,308		-		6,308		6,308		199		199
	Other assets			-		29,346		-		29,346		29,346		12,410		12,410
		Total assets	$	252	$	78,092	$	480,770	$	559,114	$	528,655	$	543,452	$	496,469
Liabilities:
	Policyholders' Account Balances - Investment contracts		$	-	$	-	$	80,566	$	80,566	$	80,658	$	78,159	$	75,242
	Cash collateral for loaned securities			-		37,786		-		37,786		37,786		38,976		38,976
	Long-term debt			-		425,061		-		425,061		400,000		426,827		400,000
	Payables to parent and affiliates			-		40,525		-		40,525		40,525		94,953		94,953
	Other liabilities			-		124,787		-		124,787		124,787		99,094		99,094
	Separate account liabilities - investment contracts			-		867		-		867		867		964		964
		Total liabilities	$	-	$	629,026	$	80,566	$	709,592	$	684,623	$	738,973	$	709,229

• Carrying values presented herein differ from those in the Company's Unaudited Interim Statements of Financial Position because certain items within the respective financial statement captions are not considered financial instruments or out of scope under authoritative guidance relating to disclosures of the fair value of financial instruments. Financial statement captions excluded from the above table are not considered financial instruments

Fair Value Inputs Quantitative Information [Table Text Block]

	As of June 30, 2013
		Fair Value	Primary Valuation Techniques	Unobservable Inputs	Minimum	Maximum	Weighted Average	Impact of Increase in Input on Fair Value (1)
	(in thousands)
Assets:
Corporate securities	$	89,564	Discounted cash flow	Discount rate	3.97%	15.00%	4.32%	Decrease
Reinsurance recoverables	$	654,058	Fair values are determined in the same manner as future policy benefits
Liabilities:
Future policy benefits (2)	$	669,989	Discounted cash flow	Lapse rate (3)	0%	14%		Decrease
				NPR spread (4)	0.11%	1.59%		Decrease
				Utilization rate (5)	70%	94%		Increase
				Withdrawal rate (6)	85%	100%		Increase
				Mortality rate (7)	0%	13%		Decrease
				Equity Volatility curve	18%	33%		Increase
	As of December 31, 2012
		Fair Value	Primary Valuation Techniques	Unobservable Inputs	Minimum	Maximum	Weighted Average	Impact of Increase in Input on Fair Value (1)
	(in thousands)
Assets:
Corporate securities	$	92,263	Discounted cash flow	Discount rate	3.27%	17.50%	3.74%	Decrease
			Cap at call price	Call price	100.00%	100.00%		Increase
Reinsurance recoverables	$	1,732,094	Fair values are determined in the same manner as future policy benefits
Liabilities:
Future policy benefits (2)	$	1,793,137	Discounted cash flow	Lapse rate (3)	0%	14%		Decrease
				NPR spread (4)	0.20%	1.60%		Decrease
				Utilization rate (5)	70%	94%		Increase
				Withdrawal rate (6)	85%	100%		Increase
				Mortality rate (7)	0%	13%		Decrease
				Equity Volatility curve	19%	34%		Increase

• Conversely, the impact of a decrease in input would have the opposite impact for the fair value as that presented in the table.
• Future policy benefits primarily represent general account liabilities for the optional living benefit features of the Company's variable annuity contracts which are accounted for as embedded derivatives. Since the valuation methodology for these liabilities uses a range of inputs that vary at the contract level over the cashflow projection period, presenting a range, rather than weighted average, is a more meaningful representation of the unobservable inputs used in the valuation.
• Base lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed amount and the current contractholder account value as well as other factors, such as the applicability of any surrender charges. A dynamic lapse adjustment reduces the base lapse rate when the guaranteed amount is greater than the account value, as in-the-money contracts are less likely to lapse. Lapse rates are also generally assumed to be lower for the period where surrender charges apply.
• To reflect NPR, the Company incorporates an additional spread over LIBOR into the discount rate used in the valuation of individual living benefit contracts in a liability position and generally not to those in a contra-liability position. In determining the NPR spread, the Company reflects the financial strength ratings of the Company as these are insurance liabilities and senior to debt. The additional spread over LIBOR is determined by utilizing the credit spreads associated with issuing funding agreements adjusted for any illiquidity risk premium.
• The utilization rate assumption estimates the percentage of contracts that will utilize the benefit during the contract duration, and begin lifetime withdrawals at various time intervals from contract inception. The remaining contractholders are assumed to either begin lifetime withdrawals immediately or never utilize the benefit. These assumptions vary based on the product type, the age of the contractholder, and the age of the contract. The impact of changes in these assumptions is highly dependent on the contract type and age of the contractholder at the time of the sale and the timing of the first lifetime income withdrawal.
• The withdrawal rate assumption estimates the magnitude of annual contractholder withdrawals relative to the maximum allowable amount under the contract. The fair value of the liability will generally increase the closer the withdrawal rate is to 100%.
• Range reflects the mortality rate for the vast majority of business with living benefits, with contractholders ranging from 35 to 90 years old. While the majority of living benefits have a minimum age requirement, certain benefits do not have an age restriction. This results in contractholders for certain benefits with mortality rates approaching 0%. Based on historical experience, the Company applies a set of age and duration specific mortality rate adjustments compared to standard industry tables. A mortality improvement assumption is also incorporated into the overall mortality table.

Fair Value Level Three Amounts By Pricing Source [Table Text Block]

	As of June 30, 2013
		Internal (1)		External (2)		Total
	(in thousands)
Corporate securities	$	89,564	$	6,628	$	96,192
Asset-backed securities		-		86,086		86,086
Commercial mortgage-backed securities		-		-		-
Equity securities		-		279		279
Other long-term Investments		19		388		407
Reinsurance recoverables		654,058		-		654,058
Receivables from parent and affiliates		-		5,250		5,250
Total assets	$	743,641	$	98,631	$	842,272
Future policy benefits		669,989		-		669,989
Total liabilities	$	669,989	$	-	$	669,989
	As of December 31, 2012
		Internal (1)		External (2)		Total
	(in thousands)
Corporate securities	$	92,263	$	3,292	$	95,555
Asset-backed securities		-		69,298		69,298
Equity securities		-		207		207
Other long-term Investments		739		315		1,054
Reinsurance recoverables		1,732,094		-		1,732,094
Receivables from parent and affiliates		-		1,995		1,995
Total assets	$	1,825,096	$	75,107	$	1,900,203
Future policy benefits		1,793,137		-		1,793,137
Total liabilities	$	1,793,137	$	-	$	1,793,137

• Represents valuations which could incorporate internally-derived and market inputs. See below for additional information related to internally-developed valuation for significant items in the above table.
• Represents unadjusted prices from independent pricing services and independent non-binding broker quotes where pricing inputs are not readily available.