Goodwill

The Company has assigned goodwill to its operating segments for impairment testing purposes. The Corporate and Other segment is not assigned goodwill. Below is a roll forward of goodwill by reportable segment.



	Solutions (1)			Specialty Property			Health			Employee Benefits			Consolidated
Balance at December 31, 2013
Goodwill	$	1,757,140		$	288,360		$	204,303		$	185,078		$	2,434,881
Accumulated impairment losses	(1,260,939		)	—			(204,303		)	(185,078		)	(1,650,320		)
	496,201			288,360			—			—			784,561
Acquisitions	51,574			28,677			—			—			80,251
Dispositions	—			(15,451		)	—			—			(15,451		)
Foreign currency translation and other	(8,122		)	—			—			—			(8,122		)
Balance at December 31, 2014
Goodwill	1,800,592			301,586			204,303			185,078			2,491,559
Accumulated impairment losses	(1,260,939		)	—			(204,303		)	(185,078		)	(1,650,320		)
	539,653			301,586			—			—			841,239
Acquisitions	2,520			5,365			—			—			7,885
Dispositions	—			(2,532		)	—			—			(2,532		)
Foreign currency translation and other	(13,080		)	—			—			—			(13,080		)
Balance at December 31, 2015
Goodwill	1,790,032			304,419			204,303			185,078			2,483,832
Accumulated impairment losses	(1,260,939		)	—			(204,303		)	(185,078		)	(1,650,320		)
	$	529,093		$	304,419		$	—		$	—		$	833,512

(1)

The accumulated impairment loss relates to an acquisition made in 1999. The entity acquired had businesses that currently are primarily represented by the Assurant Solutions and Assurant Specialty Property segments. Prior to 2006, the Assurant Solutions and Assurant Specialty Property segments were combined and together called Assurant Solutions. Thus, the entire goodwill impairment recognized in 2002 due to the adoption of FAS 142 is included in the tables under the Assurant Solutions segment.

In accordance with the goodwill guidance, goodwill is deemed to have an indefinite life and should not be amortized, but rather must be tested, at least annually, for impairment. In addition, goodwill should be tested for impairment between annual tests if an event occurs or circumstances change that would “more likely than not” reduce the estimated fair value of the reporting unit below its carrying value.

The goodwill impairment test has two steps. Step 1 of the test identifies potential impairments at the reporting unit level, which for the Company is the same as our operating segments, by comparing the estimated fair value of each reporting unit to its net book value. If the estimated fair value of a reporting unit exceeds its net book value, there is no impairment of goodwill and Step 2 is unnecessary. However, if the net book value exceeds the estimated fair value, then Step 1 is failed, and Step 2 is performed to determine the amount of the potential impairment. Step 2 utilizes acquisition accounting guidance and requires the fair value calculation of all individual assets and liabilities of the reporting unit (excluding goodwill, but including any unrecognized intangible assets). The net fair value of assets less liabilities is then compared to the reporting unit’s total estimated fair value as calculated in Step 1. The excess of fair value over the net asset value equals the implied fair value of goodwill. The implied fair value of goodwill is then compared to the carrying value of goodwill to determine the reporting unit’s goodwill impairment. Alternatively, the amended intangibles- goodwill and other guidance provides the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the two-step impairment test is unnecessary. However, if an entity concludes otherwise, then it is required to perform the first step of the two-step impairment test, described above.

In the fourth quarters of 2015, 2014 and 2013, the Company conducted its annual assessments of goodwill. During the year ended December 31, 2014, the Company changed its annual testing date from November 30 to October 1. With respect to its annual goodwill testing date, management believes that this voluntary change in accounting method is preferable as it better aligns the annual impairment testing date with the Company’s strategic planning cycle, which is a significant element in the testing process. This change in annual testing date did not delay, accelerate or avoid an impairment charge.

In 2015 for both Assurant Solutions and Assurant Specialty Property reporting units and in 2013 for the Assurant Specialty Property reporting unit, the Company chose the option to perform a qualitative assessment under the amended intangibles - goodwill and other guidance. The Company performed a Step 1 test for the Assurant Solutions reporting unit in 2014 and 2013 and for the Assurant Specialty Property reporting unit in 2014. Based on these tests, it was determined that goodwill was not impaired at either reporting unit.