BUSINESS SEGMENTS (Tables)

6 Months Ended

Jun. 30, 2020

Segment Reporting [Abstract]

Schedule of operating information by segment

Operating information by segment is as follows (dollars in millions):

	Three months ended				Six months ended
	June 30,				June 30,
	2020		2019		2020			2019
Revenues:
Annuity:
Insurance policy income	$	4.5	$	4.2	$	10.1		$	10.8
Net investment income	116.6		114.8		234.0			230.6
Total annuity revenues	121.1		119.0		244.1			241.4
Health:
Insurance policy income	360.1		358.1		722.2			716.3
Net investment income	36.1		35.8		72.2			72.0
Total health revenues	396.2		393.9		794.4			788.3
Life:
Insurance policy income	194.3		189.0		388.4			376.2
Net investment income	34.7		34.8		69.0			69.3
Total life revenues	229.0		223.8		457.4			445.5
Long-term care:
Insurance policy income	66.4		67.0		133.3			134.3
Net investment income	34.0		34.0		68.3			67.3
Total long-term care revenues	100.4		101.0		201.6			201.6
Investment income (loss) not allocated to product lines:
Related to fixed index products	50.7		23.0		(85.8		)	66.6
Other investment income	37.1		76.0		109.5			149.2
Fee revenue and other income:
Fee income	20.7		15.8		49.5			41.6
Amounts netted in expenses not allocated to product lines	1.7		2.1		3.5			4.4
Total segment revenues	$	956.9	$	954.6	$	1,774.2		$	1,938.6

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	Three months ended						Six months ended
	June 30,						June 30,
	2020			2019			2020			2019
Expenses:
Annuity:
Insurance policy benefits	$	(107.7	)	$	5.1		$	(102.2	)	$	13.0
Interest credited	43.6			41.6			85.6			84.8
Amortization and non-deferred commissions	61.4			15.1			77.4			30.2
Total annuity expenses	(2.7		)	61.8			60.8			128.0
Health:
Insurance policy benefits	274.7			272.7			544.3			537.6
Amortization and non-deferred commissions	39.2			42.9			94.2			93.5
Total health expenses	313.9			315.6			638.5			631.1
Life:
Insurance policy benefits	147.8			126.2			279.7			257.0
Interest credited	10.9			10.6			21.2			20.8
Amortization and non-deferred commissions	34.2			35.3			76.1			72.9
Total life expenses	192.9			172.1			377.0			350.7
Long-term care:
Insurance policy benefits	84.3			85.7			168.5			171.2
Amortization and non-deferred commissions	2.9			3.4			6.6			7.0
Total long-term care expenses	87.2			89.1			175.1			178.2
Allocated expenses	128.1			135.2			264.7			271.1
Expenses not allocated to product lines	40.2			22.0			55.8			42.4
Amounts netted in investment income not allocated to product lines:
Market value changes credited to policyholders	50.7			22.9			(85.8		)	66.5
Interest expense	19.4			24.9			42.1			49.4
Other expenses	9.5			2.9			1.8			8.3
Expenses netted in fee revenue:
Distribution and commission expenses	15.5			11.4			36.5			32.8
Total segment expenses	854.7			857.9			1,566.5			1,758.5
Pre-tax measure of profitability:
Annuity margin	123.8			57.2			183.3			113.4
Health margin	82.3			78.3			155.9			157.2
Life margin	36.1			51.7			80.4			94.8
Long-term care margin	13.2			11.9			26.5			23.4
Total insurance product margin	255.4			199.1			446.1			388.8
Allocated expenses	(128.1		)	(135.2		)	(264.7		)	(271.1		)
Income from insurance products	127.3			63.9			181.4			117.7
Fee income	5.2			4.4			13.0			8.8
Investment income not allocated to product lines	8.2			48.3			65.6			91.6
Expenses not allocated to product lines	(38.5		)	(19.9		)	(52.3		)	(38.0		)
Operating earnings before taxes	102.2			96.7			207.7			180.1
Income tax expense on operating income	22.8			20.3			44.0			37.9
Net operating income	$	79.4		$	76.4		$	163.7		$	142.2

Reconciliation of segment revenues and expenses to consolidated revenues and expenses and net income

A reconciliation of segment revenues and expenses to consolidated revenues and expenses and net income is as follows (dollars in millions):

	Three months ended						Six months ended
	June 30,						June 30,
	2020			2019			2020			2019
Total segment revenues	$	956.9		$	954.6		$	1,774.2		$	1,938.6
Net realized investment gains (losses)	43.8			5.3			(71.7		)	21.4
Revenues related to VIEs	8.7			14.9			19.4			32.8
Fee revenue related to transition services agreement	4.8			5.0			9.5			10.0
Consolidated revenues	1,014.2			979.8			1,731.4			2,002.8
Total segment expenses	854.7			857.9			1,566.5			1,758.5
Insurance policy benefits - fair value changes in embedded derivative liabilities	36.0			45.6			119.8			83.0
Amortization related to fair value changes in embedded derivative liabilities	(8.9		)	(9.7		)	(26.0		)	(17.5		)
Amortization related to net realized investment gains (losses)	.3			.2			(3.1		)	.4
Expenses related to VIEs	9.4			14.5			20.4			31.4
Fair value changes related to agent deferred compensation plan	13.2			11.6			13.2			16.9
Loss on extinguishment of debt	—			7.3			—			7.3
Expenses related to transition services agreement	4.1			4.7			6.2			9.5
Consolidated expenses	908.8			932.1			1,697.0			1,889.5
Income before tax	105.4			47.7			34.4			113.3
Income tax expense (benefit):
Tax expense on period income	23.4			10.1			7.6			23.9
Valuation allowance for deferred tax assets and other tax items	—			—			(34.0		)	—
Net income	$	82.0		$	37.6		$	60.8		$	89.4