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Investments (Tables)
 6 Months Ended
Jun. 30, 2020
Investments [Abstract]  
Schedule of Fixed Maturity Securities
At June 30, 2020 and December 31, 2019, the amortized cost and fair value of fixed maturity securities were as follows:
 
Amortized
Cost (1)
 
Gross
Unrealized
Gains
 
Gross
Unrealized
Losses
 
Allowance for Credit Losses
 
Fair Value
 
(Dollars in thousands)
June 30, 2020
 
 
 
 
 
 
 
 
 
Fixed maturity securities, available for sale:
 
 
 
 
 
 
 
 
 
United States Government full faith and credit
$
36,507

 
$
2,835

 
$
—

 
$
—

 
$
39,342

United States Government sponsored agencies
293,731

 
49,656

 
—

 
—

 
343,387

United States municipalities, states and territories
3,283,321

 
497,428

 
(2,039
)
 
—

 
3,778,710

Foreign government obligations
187,021

 
21,616

 
(1,128
)
 
—

 
207,509

Corporate securities
29,734,789

 
3,889,518

 
(246,847
)
 
(46,749
)
 
33,330,711

Residential mortgage backed securities
1,588,760

 
129,579

 
(4,837
)
 
(777
)
 
1,712,725

Commercial mortgage backed securities
5,524,081

 
138,590

 
(266,949
)
 
(2,660
)
 
5,393,062

Other asset backed securities
6,302,833

 
96,404

 
(465,891
)
 
—

 
5,933,346

 
$
46,951,043

 
$
4,825,626

 
$
(987,691
)
 
$
(50,186
)
 
$
50,738,792

 
 
 
 
 
 
 
 
 
 
December 31, 2019
 
 
 
 
 
 
 
 
 
Fixed maturity securities, available for sale:
 
 
 
 
 
 
 
 
 
United States Government full faith and credit
$
161,492

 
$
369

 
$
(96
)
 
$
—

 
$
161,765

United States Government sponsored agencies
601,672

 
28,133

 
(4,785
)
 
—

 
625,020

United States municipalities, states and territories
4,147,343

 
388,578

 
(8,250
)
 
—

 
4,527,671

Foreign government obligations
186,993

 
18,103

 
—

 
—

 
205,096

Corporate securities
29,822,172

 
2,796,926

 
(82,259
)
 
—

 
32,536,839

Residential mortgage backed securities
1,477,738

 
101,617

 
(3,691
)
 
—

 
1,575,664

Commercial mortgage backed securities
5,591,167

 
208,895

 
(13,783
)
 
—

 
5,786,279

Other asset backed securities
6,250,369

 
90,978

 
(179,191
)
 
—

 
6,162,156

 
$
48,238,946

 
$
3,633,599

 
$
(292,055
)
 
$
—

 
$
51,580,490


(1) Amortized cost excludes accrued interest receivable of $432.0 million as of June 30, 2020.
Schedule of Fixed Maturity Securities by Contractual Maturity Date
The amortized cost and fair value of fixed maturity securities at June 30, 2020, by contractual maturity are shown below. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. All of our mortgage and other asset backed securities provide for periodic payments throughout their lives and are shown below as separate lines.
 
Available for sale
 
Amortized
Cost
 
Fair Value
 
(Dollars in thousands)
Due in one year or less
$
425,542

 
$
432,132

Due after one year through five years
6,511,972

 
6,869,898

Due after five years through ten years
9,337,950

 
10,131,288

Due after ten years through twenty years
9,676,298

 
11,429,195

Due after twenty years
7,583,607

 
8,837,146

 
33,535,369

 
37,699,659

Residential mortgage backed securities
1,588,760

 
1,712,725

Commercial mortgage backed securities
5,524,081

 
5,393,062

Other asset backed securities
6,302,833

 
5,933,346

 
$
46,951,043

 
$
50,738,792
Schedule of Components of Net Unrealized Gains on Available for Sale Fixed Maturity Securities Reported as Separate Component of Stockholders' Equity
Net unrealized gains on available for sale fixed maturity securities reported as a separate component of stockholders' equity were comprised of the following:
 
June 30, 2020
 
December 31, 2019
 
(Dollars in thousands)
Net unrealized gains on available for sale fixed maturity securities
$
3,826,652

 
$
3,341,544

Adjustments for assumed changes in amortization of deferred policy acquisition costs and deferred sales inducements
(1,678,164
)
 
(1,473,966
)
Deferred income tax valuation allowance reversal
22,534

 
22,534

Deferred income tax expense
(451,183
)
 
(392,191
)
Net unrealized gains reported as accumulated other comprehensive income
$
1,719,839

 
$
1,497,921
Schedule of Credit Quality of Fixed Maturity Security Portfolio by NAIC Designation
The following table summarizes the credit quality, as determined by NAIC designation, of our fixed maturity portfolio as of the dates indicated:
 
 
June 30, 2020
 
December 31, 2019
NAIC
Designation
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
 
 
(Dollars in thousands)
1
 
$
25,587,355

 
$
28,327,288

 
$
27,781,525

 
$
30,122,657

2
 
19,487,757

 
20,765,334

 
19,278,355

 
20,316,911

3
 
1,577,056

 
1,430,998

 
1,001,087

 
977,191

4
 
185,879

 
156,234

 
114,497

 
112,534

5
 
51,893

 
31,644

 
57,952

 
45,205

6
 
61,103

 
27,294

 
5,530

 
5,992

 
 
$
46,951,043

 
$
50,738,792

 
$
48,238,946

 
$
51,580,490
Schedule of Gross Unrealized Losses on Investments, By Category and Length of Time
The following table shows our investments' gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities (consisting of 1,613 and 1,033 securities, respectively) have been in a continuous unrealized loss position, at June 30, 2020 and December 31, 2019:
 
Less than 12 months
 
12 months or more
 
Total
 
Fair Value
 
Unrealized
Losses (1)
 
Fair Value
 
Unrealized
Losses (1)
 
Fair Value
 
Unrealized
Losses (1)
 
(Dollars in thousands)
June 30, 2020
 
 
 
 
 
 
 
 
 
 
 
Fixed maturity securities, available for sale:
 
 
 
 
 
 
 
 
 
 
 
United States municipalities, states and territories
$
51,931

 
$
(2,039
)
 
$
—

 
$
—

 
$
51,931

 
$
(2,039
)
Foreign government obligations
23,057

 
(1,128
)
 
—

 
—

 
23,057

 
(1,128
)
Corporate securities:
 
 
 
 
 
 
 
 
 
 
 
Finance, insurance and real estate
626,564

 
(23,749
)
 
—

 
—

 
626,564

 
(23,749
)
Manufacturing, construction and mining
280,272

 
(12,977
)
 
18,451

 
(2,678
)
 
298,723

 
(15,655
)
Utilities and related sectors
457,237

 
(62,364
)
 
37,346

 
(9,405
)
 
494,583

 
(71,769
)
Wholesale/retail trade
185,882

 
(21,316
)
 
105,576

 
(27,228
)
 
291,458

 
(48,544
)
Services, media and other
570,547

 
(64,840
)
 
234,595

 
(69,039
)
 
805,142

 
(133,879
)
Residential mortgage backed securities
221,327

 
(3,882
)
 
12,675

 
(1,732
)
 
234,002

 
(5,614
)
Commercial mortgage backed securities
2,711,400

 
(249,494
)
 
88,303

 
(20,115
)
 
2,799,703

 
(269,609
)
Other asset backed securities
2,161,262

 
(125,269
)
 
2,677,210

 
(340,622
)
 
4,838,472

 
(465,891
)
 
$
7,289,479

 
$
(567,058
)
 
$
3,174,156

 
$
(470,819
)
 
$
10,463,635

 
$
(1,037,877
)
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
Fixed maturity securities, available for sale:
 
 
 
 
 
 
 
 
 
 
 
United States Government full faith and credit
$
144,582

 
$
(96
)
 
$
—

 
$
—

 
$
144,582

 
$
(96
)
United States Government sponsored agencies
168,732

 
(1,229
)
 
201,444

 
(3,556
)
 
370,176

 
(4,785
)
United States municipalities, states and territories
285,481

 
(8,173
)
 
3,081

 
(77
)
 
288,562

 
(8,250
)
Corporate securities:
 
 
 
 
 
 
 
 
 
 
 
Finance, insurance and real estate
267,521

 
(4,785
)
 
121,993

 
(4,744
)
 
389,514

 
(9,529
)
Manufacturing, construction and mining
161,633

 
(6,039
)
 
44,606

 
(3,951
)
 
206,239

 
(9,990
)
Utilities and related sectors
334,635

 
(7,730
)
 
51,269

 
(3,482
)
 
385,904

 
(11,212
)
Wholesale/retail trade
54,289

 
(1,751
)
 
129,364

 
(9,411
)
 
183,653

 
(11,162
)
Services, media and other
275,135

 
(6,135
)
 
316,086

 
(34,231
)
 
591,221

 
(40,366
)
Residential mortgage backed securities
212,404

 
(2,686
)
 
11,332

 
(1,005
)
 
223,736

 
(3,691
)
Commercial mortgage backed securities
602,394

 
(9,366
)
 
194,328

 
(4,417
)
 
796,722

 
(13,783
)
Other asset backed securities
752,413

 
(11,709
)
 
3,375,016

 
(167,482
)
 
4,127,429

 
(179,191
)
 
$
3,259,219

 
$
(59,699
)
 
$
4,448,519

 
$
(232,356
)
 
$
7,707,738

 
$
(292,055
)

(1) Unrealized losses have not been reduced to reflect the allowance for credit losses of $50.2 million as of June 30, 2020.
Schedule of Changes in Net Unrealized Gains/Losses on Investments
Changes in net unrealized gains/losses on investments for the three and six months ended June 30, 2020 and 2019 are as follows:
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2020
 
2019
 
2020
 
2019
 
(Dollars in thousands)
Fixed maturity securities available for sale carried at fair value
$
3,347,516

 
$
1,383,290

 
$
485,108

 
$
2,900,810

 
 
 
 
 
 
 
 
Adjustment for effect on other balance sheet accounts:
 
 
 
 
 
 
 
Deferred policy acquisition costs and deferred sales inducements
(1,448,951
)
 
(704,445
)
 
(204,198
)
 
(1,505,346
)
Deferred income tax asset/liability
(398,700
)
 
(142,558
)
 
(58,992
)
 
(293,048
)
 
(1,847,651
)
 
(847,003
)
 
(263,190
)
 
(1,798,394
)
Change in net unrealized gains/losses on investments carried at fair value
$
1,499,865

 
$
536,287

 
$
221,918

 
$
1,102,416
Net Realized Gains (Losses) on Investments
Net realized gains (losses) on investments for the three and six months ended June 30, 2020 and 2019, are as follows:
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2020
 
2019
 
2020
 
2019
 
(Dollars in thousands)
Available for sale fixed maturity securities:
 
 
 
 
 
 
 
Gross realized gains
$
1,215

 
$
5,255

 
$
15,453

 
$
6,426

Gross realized losses
(264
)
 
(2,287
)
 
(1,470
)
 
(4,081
)
Credit losses (1)
(25,041
)
 
—

 
(56,412
)
 
—

 
(24,090
)
 
2,968

 
(42,429
)
 
2,345

Other investments:
 
 
 
 
 
 
 
Gross realized gains
—

 
7,296

 
—

 
7,296

Gross realized losses
—

 
(14,446
)
 
—

 
(14,446
)
 
—

 
(7,150
)
 
—

 
(7,150
)
Mortgage loans on real estate:
 
 
 
 
 
 
 
Increase (decrease) in allowance for credit losses
(2,510
)
 
350

 
(4,507
)
 
410

Recovery of specific allowance
712

 
—

 
712

 
—

 
(1,798
)
 
350

 
(3,795
)
 
410

 
$
(25,888
)
 
$
(3,832
)
 
$
(46,224
)
 
$
(4,395
)

(1) Prior to adopting authoritative guidance effective January 1, 2020, credit losses on available for sale fixed maturity securities were classified as other than temporary impairments and reported in a separate line item in the Consolidated statements of operations. We recognized $1.2 million of other than temporary impairments during the three and six months ended June 30, 2019.
Rollforward of Allowance for Credit Loss
The following table provides a rollforward of the allowance for credit loss:
 
Three Months Ended June 30, 2020
 
Corporate Securities
 
Commercial Mortgage Backed Securities
 
Residential Mortgage Backed Securities
 
Other Asset Backed Securities
 
Total
 
(Dollars in thousands)
Beginning balance (1)
$
28,332

 
$
—

 
$
—

 
$
—

 
$
28,332

Additions for credit losses not previously recorded
18,417

 
5,847

 
777

 
—

 
25,041

Reduction for securities with credit losses due to intent to sell
—

 
(3,187
)
 
—

 
—

 
(3,187
)
Ending balance
$
46,749

 
$
2,660

 
$
777

 
$
—

 
$
50,186

 
 
 
 
 
 
 
 
 
 
 
Six Months Ended June 30, 2020
 
Corporate Securities
 
Commercial Mortgage Backed Securities
 
Residential Mortgage Backed Securities
 
Other Asset Backed Securities
 
Total
 
(Dollars in thousands)
Beginning balance (1)
$
—

 
$
—

 
$
—

 
$
—

 
$
—

Additions for credit losses not previously recorded
46,749

 
8,338

 
777

 
548

 
56,412

Reduction for securities with credit losses due to intent to sell
—

 
(5,678
)
 
—

 
(548
)
 
(6,226
)
Ending balance
$
46,749

 
$
2,660

 
$
777

 
$
—

 
$
50,186

(1) The allowance for credit loss associated with available for sale fixed maturity securities was applied prospectively upon adoption of authoritative guidance effective January 1, 2020. See Note 1 for further details.
Other Than Temporary Impairment, Credit Losses Recognized in Earnings
The cumulative portion of other than temporary impairments determined to be credit losses which have been recognized in operations for debt securities are summarized as follows:
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2019
 
2019
 
(Dollars in thousands)
Cumulative credit loss at beginning of period
$
(175,398
)
 
$
(175,398
)
Additions for the amount related to credit losses for which OTTI has not previously been recognized
(998
)
 
(998
)
Additional credit losses on securities for which OTTI has previously been recognized
(215
)
 
(215
)
Accumulated losses on securities that were disposed of during the period
10,960

 
10,960

Cumulative credit loss at end of period
$
(165,651
)
 
$
(165,651
)
Schedule of Other Than Temporary Impairment Losses, Investments
The following table summarizes the cumulative noncredit portion of OTTI and the change in fair value since recognition of OTTI, both of which were recognized in other comprehensive income, by major type of security, for securities that are part of our investment portfolio at December 31, 2019:
 
Amortized Cost
 
OTTI
Recognized in
Other
Comprehensive
Income (Loss)
 
Change in Fair
Value Since
OTTI was
Recognized
 
Fair Value
 
(Dollars in thousands)
December 31, 2019
 
 
 
 
 
 
 
Fixed maturity securities, available for sale:
 
 
 
 
 
 
 
Corporate securities
$
50,755

 
$
(3,700
)
 
$
9,268

 
$
56,323

Residential mortgage backed securities
183,948

 
(145,446
)
 
172,577

 
211,079

Commercial mortgage backed securities
12,776

 
—

 
(401
)
 
12,375

Other asset backed securities
977

 
—

 
261

 
1,238

 
$
248,456

 
$
(149,146
)
 
$
181,705

 
$
281,015