Fair Value Measurements

3 Months Ended

Jun. 30, 2024

Fair Value Disclosures [Abstract]

Fair Value Measurements

15. Fair Value Measurements

Certain assets and liabilities are recorded at fair value on the consolidated balance sheets and are measured and classified based upon a three-tiered approach to valuation. Financial assets and liabilities are recorded at fair value and are classified and disclosed in one of the following three categories:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;

Level 2 – Quoted prices for identical or similar financial instruments in markets that are not considered to be active, or similar financial instruments for which all significant inputs are observable, either directly or indirectly, or inputs other than quoted prices that are observable, or inputs that are derived principally from or corroborated by observable market data through correlation or other means; and

Level 3 – Prices or valuations that require inputs that are both significant to the fair value measurement and are unobservable. These reflect management’s assumptions about the assumptions a market participant would use in pricing the asset or liability.

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Fair values of investments available-for-sale are based on quoted market prices, dealer quotes or discounted cash flows.

Fair values of derivatives are based on using pricing valuation models which include broker quotes.

The following tables represent the financial assets and liabilities on the consolidated balance sheets as of June 30, 2024 and March 31, 2024, that are measured at fair value on a recurring basis and the level within the fair value hierarchy.

As of June 30, 2024	Total		Level 1		Level 2		Level 3
	(Unaudited)
Assets	(In thousands)
Fixed maturities - available for sale	$	2,395,890	$	—	$	2,395,832	$	58
Preferred stock		22,067		22,067		—		—
Common stock		51,999		51,999		—		—
Derivatives		17,190		8,804		8,386		—
Total	$	2,487,146	$	82,870	$	2,404,218	$	58
Liabilities
Embedded derivatives	$	9,880	$	—	$	—	$	9,880
Liabilities from investment contracts		2,295,851		—		—		2,295,851
Market risk benefits		13,447		—		—		13,447
Total	$	2,319,178	$	—	$	—	$	2,319,178

As of March 31, 2024	Total		Level 1		Level 2		Level 3
	(In thousands)
Assets
Fixed maturities - available for sale	$	2,442,504	$	—	$	2,442,446	$	58
Preferred stock		21,260		21,260		—		—
Common stock		45,014		45,014		—		—
Derivatives		18,930		10,538		8,392		—
Total	$	2,527,708	$	76,812	$	2,450,838	$	58
Liabilities
Embedded derivatives	$	9,300	$	—	$	—	$	9,300
Liabilities from investment contracts		2,290,096		—		—		2,290,096
Market risk benefits		13,400		—		—		13,400
Total	$	2,312,796	$	—	$	—	$	2,312,796

We estimate the fair value for financial instruments not carried at fair value using the same methods and assumptions as those we carry at fair value. The financial instruments presented below are reported at carrying value on the consolidated balance sheets.

Cash equivalents were $870.5 million and $1,173.6 million as of June 30, 2024 and March 31, 2024, respectively. Fair values of cash equivalents approximate carrying value due to the short period of time to maturity.

Fair values of mortgage loans and notes on real estate are based on quoted market prices, dealer quotes or discounted cash flows. Fair values of trade receivables approximate their recorded value.

Our financial instruments that are exposed to concentrations of credit risk consist primarily of temporary cash investments, trade receivables, and notes receivable. Limited credit risk exists on trade receivables due to the diversity of our customer base and their dispersion across broad geographic markets. We place our temporary cash investments with financial institutions and limit the amount of credit exposure to any one financial institution.

We have mortgage loans, which potentially expose us to credit risk. The portfolio of loans is principally collateralized by self-storage facilities and commercial properties. We have not experienced any material losses related to the loans from individual or groups of loans in any particular industry or geographic area. The estimated fair values were determined using the discounted cash flow method and using interest rates currently offered for similar loans to borrowers with similar credit ratings.

Other investments are substantially current or bear reasonable interest rates. As a result, the carrying values of these financial instruments approximate fair value.

The following represents our financial instruments not carried at fair value on the consolidated balance sheets and corresponding placement in the fair value hierarchy.

	Fair Value Hierarchy
	Carrying								Total
As of June 30, 2024	Value		Level 1		Level 2		Level 3		Fair Value
	(Unaudited)
Assets	(In thousands)
Trade receivables, net	$	215,735	$	—	$	—	$	215,735	$	215,735
Mortgage loans, net		617,230		—		—		589,880		589,880
Other investments		12,389		—		—		12,389		12,389
Total	$	845,354	$	—	$	—	$	818,004	$	818,004
Liabilities
Notes, loans and finance leases payable	$	6,311,676	$	—	$	5,888,119	$	—	$	5,888,119
Total	$	6,311,676	$	—	$	5,888,119	$	—	$	5,888,119

	Fair Value Hierarchy
	Carrying								Total
As of March 31, 2024	Value		Level 1		Level 2		Level 3		Fair Value
	(In thousands)
Assets
Trade receivables, net	$	177,602	$	—	$	—	$	177,602	$	177,602
Mortgage loans, net		604,481		—		—		579,767		579,767
Other investments		18,917		—		—		18,917		18,917
Total	$	801,000	$	—	$	—	$	776,286	$	776,286
Liabilities
Notes, loans and finance leases payable		6,304,038		—		5,850,346		—		5,850,346
Total	$	6,304,038	$	—	$	5,850,346	$	—	$	5,850,346