Investments (Tables)

3 Months Ended

Mar. 31, 2015

Investments, Debt and Equity Securities [Abstract]

Summary of Fixed Maturities and Equity Securities Available for Sale by Component

A summary of fixed maturities and equity securities available for sale by cost or amortized cost and estimated fair value at March 31, 2015 is as follows.

Portfolio Composition as of March 31, 2015



	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		% of Total Fixed Maturities*
Fixed maturities available for sale:
Bonds:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	369,684	$	14,107	$	(791	)	$	383,000	3
States, municipalities, and political subdivisions	1,281,007		183,084		(423		)	1,463,668		10
Foreign governments	27,372		1,918		(1		)	29,289		—

Corporates, by sector:
Financial	2,609,600		471,670		(13,593		)	3,067,677		20
Utilities	2,147,011		434,773		(524		)	2,581,260		18
Energy	1,546,541		197,320		(24,426		)	1,719,435		12
Other corporate sectors	4,401,258		610,592		(13,139		)	4,998,711		33
Total corporates	10,704,410		1,714,355		(51,682		)	12,367,083		83

Collateralized debt obligations	65,642		16,784		(7,872		)	74,554		—
Other asset-backed securities	20,384		1,555		—			21,939		—

Redeemable preferred stocks, by sector:
Financial	465,655		64,554		(4,828		)	525,381		4
Utilities	28,676		947		(23		)	29,600		—
Total redeemable preferred stocks	494,331		65,501		(4,851		)	554,981		4

Total fixed maturities	12,962,830		1,997,304		(65,620		)	14,894,514		100
Equity securities	776		698		—			1,474
Total fixed maturities and equity securities	$	12,963,606	$	1,998,002	$	(65,620	)	$	14,895,988

* At fair value

Schedule of Fixed Maturities by Contractual Maturity

A schedule of fixed maturities by contractual maturity date at March 31, 2015 is shown below on an amortized cost basis and on a fair value basis. Actual maturity dates could differ from contractual maturities due to call or prepayment provisions.



	Amortized Cost		Fair Value
Fixed maturities available for sale:
Due in one year or less	$	132,153	$	134,358
Due from one to five years	510,813		575,083
Due from five to ten years	931,954		1,043,718
Due from ten to twenty years	3,739,429		4,379,923
Due after twenty years	7,560,176		8,662,450
Mortgage-backed and asset-backed securities	88,305		98,982
	$	12,962,830	$	14,894,514

Schedule of Selected Information about Sales of Fixed Maturities

Selected information about sales of fixed maturities is as follows.



For the three months ended March 31,
	2015		2014
Proceeds from sales	$	11,444	$	16,050
Gross realized gains	84		15,925
Gross realized losses	—		—

Assets Measured at Fair Value on Recurring Basis

The following table represents assets measured at fair value on a recurring basis.

Fair Value Measurements at March 31, 2015 Using:



Description	Quoted Prices in Active Markets for Identical Assets (Level 1)			Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)			Total Fair Value
Fixed maturities available for sale:
Bonds:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	—		$	383,000		$	—		$	383,000
States, municipalities, and political subdivisions	—			1,463,668			—			1,463,668
Foreign governments	—			29,289			—			29,289

Corporates, by sector:
Financial	—			2,996,597			71,080			3,067,677
Utilities	25,426			2,413,683			142,151			2,581,260
Energy	—			1,691,735			27,700			1,719,435
Other corporate sectors	7,000			4,704,629			287,082			4,998,711
Total corporates	32,426			11,806,644			528,013			12,367,083

Collateralized debt obligations	—			—			74,554			74,554
Other asset-backed securities	—			21,939			—			21,939

Redeemable preferred stocks, by sector:
Financial	15,434			509,947			—			525,381
Utilities	—			29,600			—			29,600
Total redeemable preferred stocks	15,434			539,547			—			554,981

Total fixed maturities	47,860			14,244,087			602,567			14,894,514
Equity securities	641			—			833			1,474
Total fixed maturities and equity securities	$	48,501		$	14,244,087		$	603,400		$	14,895,988
Percent of total	0.3		%	95.6		%	4.1		%	100.0		%

Schedule of Changes in Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs

The following table represents an analysis of changes in fair value measurements using significant unobservable inputs (Level 3).

Analysis of Changes in Fair Value Measurements Using

Significant Unobservable Inputs (Level 3)



	For the three months ended March 31, 2015
	Collateralized debt obligations			Corporates ⁽¹⁾			Equities			Total
Balance at January 1, 2015	$	63,232		$	512,714		$	833		$	576,779
Total gains or losses:
Included in realized gains/losses	—			—			—			—
Included in other comprehensive income	13,556			8,626			—			22,182
Acquisitions	—			8,000			—			8,000
Sales	—			—			—			—
Amortization	1,410			4			—			1,414
Other ⁽²⁾	(3,644		)	(1,331		)	—			(4,975		)
Transfers in and/or out of Level 3 ⁽³⁾	—			—			—			—
Balance at March 31, 2015	$	74,554		$	528,013		$	833		$	603,400
Percent of total fixed maturity and equity securities	0.5		%	3.6		%	—		%	4.1		%

	For the three months ended March 31, 2014
	Collateralized debt obligations			Corporates ⁽¹⁾			Equities			Total
Balance at January 1, 2014	$	58,205		$	300,300		$	776		$	359,281
Total gains or losses:
Included in realized gains/losses	15,924			1			—			15,925
Included in other comprehensive income	7,283			12,772			—			20,055
Acquisitions	—			33,791			—			33,791
Sales	(16,049		)	(1		)	—			(16,050		)
Amortization	1,307			3			—			1,310
Other ⁽²⁾	(2,340		)	(836		)	—			(3,176		)
Transfers in and/or out of Level 3 ⁽³⁾	—			—			—			—
Balance at March 31, 2014	$	64,330		$	346,030		$	776		$	411,136
Percent of total fixed maturity and equity securities	0.5		%	2.5		%	—		%	3.0		%


(1)	Includes redeemable preferred stocks.


(2)	Includes capitalized interest, foreign exchange adjustments, and principal repayments.


(3)	Considered to be transferred at the end of the period. Transfers into Level 3 occur when observable inputs are no longer available. Transfers out of Level 3 occur when observable inputs become available.

Schedule of Additional Information About Investments in Unrealized Loss Position

The following table discloses information about investments in an unrealized loss position:



	Less than Twelve Months	Twelve Months or Longer	Total
Number of issues (Cusip numbers) held:
As of March 31, 2015	99	63	162
As of December 31, 2014	80	173	253

Schedule of Unrealized Investment Losses by Class of Investment

The following table discloses unrealized investment losses by class of investment at March 31, 2015 for the period of time in a loss position. Torchmark considers these investments not to be other-than-temporarily impaired.

Analysis of Gross Unrealized Investment Losses

At March 31, 2015



	Less than Twelve Months					Twelve Months or Longer					Total
Description of Securities	Fair Value		Unrealized Loss			Fair Value		Unrealized Loss			Fair Value		Unrealized Loss
Fixed maturities available for sale:
Investment grade:
Bonds:
U.S. Government direct, guaranteed, and government-sponsored enterprises	$	22,803	$	(158	)	$	14,868	$	(633	)	$	37,671	$	(791	)
States, municipalities and political subdivisions	10,033		(169		)	1,026		(58		)	11,059		(227		)
Foreign governments	—		—			781		(1		)	781		(1		)
Corporates, by sector:
Financial	24,388		(330		)	—		—			24,388		(330		)
Utilities	44,928		(523		)	4,999		(1		)	49,927		(524		)
Energy	172,234		(12,241		)	64,968		(4,486		)	237,202		(16,727		)
Other corporate sectors	292,023		(5,321		)	49,935		(3,265		)	341,958		(8,586		)
Total corporates	533,573		(18,415		)	119,902		(7,752		)	653,475		(26,167		)
Collateralized debt obligations	—		—			—		—			—		—
Other asset-backed securities	—		—			—		—			—		—
Redeemable preferred stocks, by sector:
Financial	1,007		(1		)	—		—			1,007		(1		)
Utilities	—		—			1,645		(23		)	1,645		(23		)
Total redeemable preferred stocks	1,007		(1		)	1,645		(23		)	2,652		(24		)
Total investment grade	567,416		(18,743		)	138,222		(8,467		)	705,638		(27,210		)
Below investment grade:
Bonds:
States, municipalities and political subdivisions	—		—			360		(196		)	360		(196		)
Corporates, by sector:
Financial	—		—			92,540		(13,263		)	92,540		(13,263		)
Utilities	—		—			—		—			—		—
Energy	49,299		(7,699		)	—		—			49,299		(7,699		)
Other corporate sectors	16,967		(395		)	52,693		(4,158		)	69,660		(4,553		)
Total corporates	66,266		(8,094		)	145,233		(17,421		)	211,499		(25,515		)
Collateralized debt obligations	—		—			12,128		(7,872		)	12,128		(7,872		)
Other asset-backed securities	—		—			—		—			—		—
Redeemable preferred stocks, by sector:
Financial	—		—			57,512		(4,827		)	57,512		(4,827		)
Total redeemable preferred stocks	—		—			57,512		(4,827		)	57,512		(4,827		)
Total below investment grade	66,266		(8,094		)	215,233		(30,316		)	281,499		(38,410		)
Total fixed maturities	633,682		(26,837		)	353,455		(38,783		)	987,137		(65,620		)
Equity securities	—		—			—		—			—		—
Total fixed maturities and equity securities	$	633,682	$	(26,837	)	$	353,455	$	(38,783	)	$	987,137	$	(65,620	)

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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