DEFERRED POLICY ACQUISITION COSTS AND VALUE OF BUSINESS ACQUIRED

12 Months Ended

Dec. 31, 2018

DEFERRED POLICY ACQUISITION COSTS AND VALUE OF BUSINESS ACQUIRED

DEFERRED POLICY ACQUISITION COSTS AND VALUE OF BUSINESS ACQUIRED

DEFERRED POLICY ACQUISITION COSTS AND VALUE OF BUSINESS ACQUIRED

Deferred Policy Acquisition Costs

The balances and changes in DAC are as follows:

	As of December 31,
	2018			2017
	(Dollars In Thousands)
Balance, beginning of period	$	837,785		$	572,328
Capitalization of commissions, sales, and issue expenses	446,468			333,250
Amortization	(133,337		)	(52,559		)
Change due to unrealized investment gains and losses	56,153			(15,234		)
Implementation of ASU 2014-09	138,434			—
Balance, end of period	$	1,345,503		$	837,785

Value of Business Acquired

The balances and changes in VOBA are as follows:

	As of December 31,
	2018			2017
	(Dollars In Thousands)
Balance, beginning of period	$	1,361,792		$	1,447,501
Acquisitions	336,862			—
Amortization	(92,471		)	(25,662		)
Change due to unrealized investment gains and losses	71,468			(60,047		)
Balance, end of period	$	1,677,651		$	1,361,792

Based on the balance recorded as of December 31, 2018, the expected amortization of VOBA for the next five years is as follows:

	Expected
Years	Amortization
	(Dollars In Thousands)
2019	$	139,662
2020	128,465
2021	114,081
2022	104,147
2023	94,740