Fair Values of Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value Disclosures [Abstract]

Carrying Amount and Fair Value of Financial Instruments

Presented as follows are the carrying amounts and fair values of financial instruments. The carrying values of financial instruments such as short-term investments, cash and bank deposits, accounts and premiums receivable, accrued investment income, and short-term debt approximate fair value due to the short-term nature of the instruments. As such, these financial instruments are not included in the following chart.

	September 30, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions of dollars)
Assets
Fixed Maturity Securities	$	44,715.2	$	44,715.2	$	42,344.4	$	42,344.4
Mortgage Loans	1,807.5		1,981.0		1,815.1		1,980.2
Policy Loans	3,355.5		3,447.0		3,276.0		3,339.6
Other Long-term Investments
Derivatives	15.1		15.1		10.8		10.8
Equity Securities	14.7		14.7		16.4		16.4
Miscellaneous Long-term Investments	471.4		471.4		475.2		475.2
Liabilities
Policyholders' Funds
Deferred Annuity Products	$	626.6	$	626.6	$	631.5	$	631.5
Supplementary Contracts without Life Contingencies	594.8		594.8		563.1		563.1
Long-term Debt	2,783.3		3,057.7		2,612.0		2,824.4
Other Liabilities
Derivatives	107.2		107.2		135.6		135.6
Embedded Derivative in Modified Coinsurance Arrangement	34.6		34.6		53.2		53.2
Unfunded Commitments to Investment Partnerships	13.7		13.7		27.2		27.2

Fair Values by Fair Value Heirarchy Input Level

Fair value measurements by input level for financial instruments carried at fair value are as follows.

	September 30, 2014
	Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in millions of dollars)
Assets
Fixed Maturity Securities
United States Government and Government Agencies and Authorities	$	291.2	$	905.2	$	—	$	1,196.4
States, Municipalities, and Political Subdivisions	—		1,908.5		134.1		2,042.6
Foreign Governments	—		1,310.2		36.5		1,346.7
Public Utilities	744.5		7,450.4		239.7		8,434.6
Mortgage/Asset-Backed Securities	—		2,492.5		9.2		2,501.7
All Other Corporate Bonds	6,499.1		21,285.3		1,358.7		29,143.1
Redeemable Preferred Stocks	—		25.2		24.9		50.1
Total Fixed Maturity Securities	7,534.8		35,377.3		1,803.1		44,715.2
Other Long-term Investments
Derivatives
Interest Rate Swaps	—		6.1		—		6.1
Foreign Exchange Contracts	—		9.0		—		9.0
Total Derivatives	—		15.1		—		15.1
Equity Securities	—		11.6		3.1		14.7
Liabilities
Other Liabilities
Derivatives
Interest Rate Swaps	$	—	$	25.7	$	—	$	25.7
Foreign Exchange Contracts	—		79.6		—		79.6
Credit Default Swaps	—		1.9		—		1.9
Embedded Derivative in Modified Coinsurance Arrangement	—		—		34.6		34.6
Total Derivatives	—		107.2		34.6		141.8

	December 31, 2013
	Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Total
	(in millions of dollars)
Assets
Fixed Maturity Securities
United States Government and Government Agencies and Authorities	$	144.5	$	1,051.6	$	—	$	1,196.1
States, Municipalities, and Political Subdivisions	—		1,608.1		175.1		1,783.2
Foreign Governments	—		1,294.7		78.5		1,373.2
Public Utilities	246.0		7,611.9		139.3		7,997.2
Mortgage/Asset-Backed Securities	—		2,038.8		0.5		2,039.3
All Other Corporate Bonds	2,132.8		23,861.6		1,923.3		27,917.7
Redeemable Preferred Stocks	—		13.9		23.8		37.7
Total Fixed Maturity Securities	2,523.3		37,480.6		2,340.5		42,344.4
Other Long-term Investments
Derivatives
Interest Rate Swaps	—		9.2		—		9.2
Foreign Exchange Contracts	—		1.6		—		1.6
Total Derivatives	—		10.8		—		10.8
Equity Securities	—		11.8		4.6		16.4
Liabilities
Other Liabilities
Derivatives
Interest Rate Swaps	$	—	$	35.0	$	—	$	35.0
Foreign Exchange Contracts	—		98.7		—		98.7
Credit Default Swaps	—		1.9		—		1.9
Embedded Derivative in Modified Coinsurance Arrangement	—		—		53.2		53.2
Total Derivatives	—		135.6		53.2		188.8

Transfers of Assets between Level 1 and Level 2

Transfers of assets between Level 1 and Level 2 are as follows:

	Three Months Ended September 30
	2014				2013
	Transfers into
	Level 1 from Level 2		Level 2 from Level 1		Level 1 from Level 2		Level 2 from Level 1
	(in millions of dollars)
Fixed Maturity Securities
United States Government and Government Agencies and Authorities	$	169.6	$	—	$	21.7	$	164.6
States, Municipalities, and Political Subdivisions	—		—		—		31.8
Public Utilities	415.1		218.8		239.3		375.7
All Other Corporate Bonds	3,241.4		2,181.0		1,534.7		3,093.6
Total Fixed Maturity Securities	$	3,826.1	$	2,399.8	$	1,795.7	$	3,665.7

	Nine Months Ended September 30
	2014				2013
	Transfers into
	Level 1 from Level 2		Level 2 from Level 1		Level 1 from Level 2		Level 2 from Level 1
	(in millions of dollars)
Fixed Maturity Securities
United States Government and Government Agencies and Authorities	$	163.2	$	—	$	48.0	$	—
States, Municipalities, and Political Subdivisions	—		—		—		53.1
Public Utilities	470.8		88.1		405.5		33.5
All Other Corporate Bonds	4,102.0		548.3		2,708.8		1,012.2
Total Fixed Maturity Securities	$	4,736.0	$	636.4	$	3,162.3	$	1,098.8

Changes in Assets and Liabilities Measured at Fair Value using Significant Unobservable Inputs

Changes in assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) are as follows.

	Three Months Ended September 30, 2014
				Total Realized and Unrealized Investment Gains (Losses) Included in
	Beginning of Period			Earnings			Other Comprehensive Income or Loss			Purchases		Sales			Level 3 Transfers					End of Period
															Into		Out of
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions	$	131.5		$	—		$	2.7		$	—	$	(0.1	)	$	—	$	—		$	134.1
Foreign Governments	81.2			—			(0.2		)	—		—			—		(44.5		)	36.5
Public Utilities	179.4			—			(0.5		)	—		—			96.0		(35.2		)	239.7
Mortgage/Asset-Backed Securities	—			—			—			—		—			9.2		—			9.2
All Other Corporate Bonds	1,159.7			1.0			(2.7		)	—		(17.3		)	416.3		(198.3		)	1,358.7
Redeemable Preferred Stocks	24.8			—			0.1			—		—			—		—			24.9
Total Fixed Maturity Securities	1,576.6			1.0			(0.6		)	—		(17.4		)	521.5		(278.0		)	1,803.1
Equity Securities	3.1			—			—			—		—			—		—			3.1
Embedded Derivative in Modified Coinsurance Arrangement	(32.3		)	(2.3		)	—			—		—			—		—			(34.6		)
	Three Months Ended September 30, 2013
				Total Realized and Unrealized Investment Gains (Losses) Included in
	Beginning of Period			Earnings			Other Comprehensive Income or Loss			Purchases		Sales			Level 3 Transfers					End of Period
															Into		Out of
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions	$	152.0		$	—		$	(0.1	)	$	—	$	—		$	—	$	—		$	151.9
Foreign Governments	80.0			—			(1.4		)	—		—			—		—			78.6
Public Utilities	75.5			—			2.3			—		—			93.8		(18.1		)	153.5
Mortgage/Asset-Backed Securities	14.9			(1.3		)	0.9			—		(14.0		)	—		—			0.5
All Other Corporate Bonds	1,321.2			(1.0		)	(10.0		)	7.0		(23.0		)	591.0		(534.4		)	1,350.8
Redeemable Preferred Stocks	24.2			—			(0.1		)	—		—			—		—			24.1
Total Fixed Maturity Securities	1,667.8			(2.3		)	(8.4		)	7.0		(37.0		)	684.8		(552.5		)	1,759.4
Equity Securities	4.4			—			—			—		—			—		—			4.4
Embedded Derivative in Modified Coinsurance Arrangement	(65.1		)	(0.3		)	—			—		—			—		—			(65.4		)

	Nine Months Ended September 30, 2014
				Total Realized and Unrealized Investment Gains (Losses) Included in
	Beginning of Year			Earnings			Other Comprehensive Income or Loss			Purchases		Sales			Level 3 Transfers					End of Period
															Into		Out of
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions	$	175.1		$	—		$	14.3		$	—	$	(0.7	)	$	—	$	(54.6	)	$	134.1
Foreign Governments	78.5			—			—			—		—			—		(42.0		)	36.5
Public Utilities	139.3			—			4.8			—		(0.2		)	126.0		(30.2		)	239.7
Mortgage/Asset-Backed Securities	0.5			(0.2		)	0.5			9.0		(0.6		)	—		—			9.2
All Other Corporate Bonds	1,923.3			1.0			42.4			89.6		(97.6		)	569.0		(1,169.0		)	1,358.7
Redeemable Preferred Stocks	23.8			—			1.1			—		—			—		—			24.9
Total Fixed Maturity Securities	2,340.5			0.8			63.1			98.6		(99.1		)	695.0		(1,295.8		)	1,803.1
Equity Securities	4.6			2.1			(0.1		)	—		(3.5		)	—		—			3.1
Embedded Derivative in Modified Coinsurance Arrangement	(53.2		)	18.6			—			—		—			—		—			(34.6		)
	Nine Months Ended September 30, 2013
				Total Realized and Unrealized Investment Gains (Losses) Included in
	Beginning of Year			Earnings			Other Comprehensive Income or Loss			Purchases		Sales			Level 3 Transfers					End of Period
															Into		Out of
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions	$	128.7		$	—		$	(8.4	)	$	—	$	(0.5	)	$	32.1	$	—		$	151.9
Foreign Governments	82.1			—			(3.5		)	—		—			—		—			78.6
Public Utilities	226.4			—			1.0			—		(3.6		)	114.9		(185.2		)	153.5
Mortgage/Asset-Backed Securities	0.5			—			0.1			—		(0.1		)	—		—			0.5
All Other Corporate Bonds	1,525.8			1.1			(90.9		)	30.1		(86.9		)	937.2		(965.6		)	1,350.8
Redeemable Preferred Stocks	24.8			—			(0.7		)	—		—			—		—			24.1
Total Fixed Maturity Securities	1,988.3			1.1			(102.4		)	30.1		(91.1		)	1,084.2		(1,150.8		)	1,759.4
Equity Securities	4.3			—			0.1			—		—			—		—			4.4
Embedded Derivative in Modified Coinsurance Arrangement	(83.9		)	18.5			—			—		—			—		—			(65.4		)

Quantitative Information Regarding Significant Unobservable Inputs

The table below provides quantitative information regarding the significant unobservable inputs used in Level 3 fair value measurements derived from internal models. Certain securities classified as Level 3 are excluded from the table below due to limitations in our ability to obtain the underlying inputs used by external pricing sources.

	September 30, 2014
	Fair Value			Unobservable Input		Range/Weighted Average
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions - Private	$	97.1		- Comparability Adjustment	(b)	0.25% - 1.00% / 0.71%
All Other Corporate Bonds - Private	428.3			- Change in Benchmark Reference - Comparability Adjustment - Discount for Size - Volatility of Credit - Market Convention	(a) (b) (c) (e) (f)	0.33% - 0.75% / 0.54% (0.69%) - 0.50% / (0.27%) 0.50% - 0.50% / 0.50% 0.20% - 2.00% / 0.55% Priced at Par
All Other Corporate Bonds - Public	64.2			- Change in Benchmark Reference - Comparability Adjustment - Lack of Marketability - Volatility of Credit	(a) (b) (d) (e)	0.25% - 0.25% / 0.25% 0.10% - 0.25% / 0.20% 0.20% - 0.20% / 0.20% (0.30%) - (0.30%) / (0.30%)
Equity Securities - Private	2.8			- Market Convention	(f)	Priced at Cost or Owner's Equity
Embedded Derivative in Modified Coinsurance Arrangement	(34.6		)	- Projected Liability Cash Flows	(g)	Actuarial Assumptions

	December 31, 2013
	Fair Value			Unobservable Input		Range/Weighted Average
	(in millions of dollars)
Fixed Maturity Securities
States, Municipalities, and Political Subdivisions - Private	$	142.7		- Comparability Adjustment	(b)	0.25% - 1.25% / 0.65%
Mortgage/Asset-Backed Securities - Private	0.5			- Discount for Size	(c)	4.93% - 5.03% / 5.01%
All Other Corporate Bonds - Private	371.3			- Change in Benchmark Reference - Comparability Adjustment - Discount for Size - Lack of Marketability - Volatility of Credit - Market Convention	(a) (b) (c) (d) (e) (f)	3.36% - 3.36% / 3.36% (0.70)% - (0.40)% / (0.60)% 0.50% - 0.50% / 0.50% 0.20% - 1.00% / 0.55% 0.07% - 4.00% / 0.85% Priced at Par
All Other Corporate Bonds - Public	514.4			- Change in Benchmark Reference - Comparability Adjustment - Lack of Marketability - Volatility of Credit	(a) (b) (d) (e)	(0.32)% - 0.25% / 0.04% (0.23)% - 1.00% / 0.41% 0.20% - 0.20% / 0.20% (0.88)% - 0.46% / (0.26)%
Equity Securities - Private	4.2			- Market Convention	(f)	Priced at Cost or Owner's Equity
Embedded Derivative in Modified Coinsurance Arrangement	(53.2		)	- Projected Liability Cash Flows	(g)	Actuarial Assumptions

(a) Represents basis point adjustments for changes in benchmark spreads associated with various ratings categories

(b) Represents basis point adjustments for changes in benchmark spreads associated with various industry sectors

(c) Represents basis point adjustments based on issue/issuer size relative to the benchmark

(d) Represents basis point adjustments to apply a discount due to the illiquidity of an investment

(e) Represents basis point adjustments for credit-specific factors

(f) Represents a decision to price based on par value, cost, or owner's equity when limited data is available

(g) Represents various actuarial assumptions required to derive the liability cash flows including incidence, termination, and lapse rates