Investments (Tables)

9 Months Ended

Sep. 30, 2014

Investments, Debt and Equity Securities [Abstract]

Amortized Cost and Fair Values of Securities by Security Type

The amortized cost and fair values of securities by security type are shown as follows.

	September 30, 2014
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
	(in millions of dollars)
United States Government and Government Agencies and Authorities	$	975.3	$	222.5	$	1.4	$	1,196.4
States, Municipalities, and Political Subdivisions	1,744.0		302.4		3.8		2,042.6
Foreign Governments	1,166.9		179.8		—		1,346.7
Public Utilities	7,121.4		1,317.8		4.6		8,434.6
Mortgage/Asset-Backed Securities	2,309.8		192.5		0.6		2,501.7
All Other Corporate Bonds	25,559.0		3,658.3		74.2		29,143.1
Redeemable Preferred Stocks	44.0		6.1		—		50.1
Total Fixed Maturity Securities	$	38,920.4	$	5,879.4	$	84.6	$	44,715.2

	December 31, 2013
	Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss		Fair Value
	(in millions of dollars)
United States Government and Government Agencies and Authorities	$	1,028.6	$	173.1	$	5.6	$	1,196.1
States, Municipalities, and Political Subdivisions	1,706.0		117.2		40.0		1,783.2
Foreign Governments	1,226.4		149.6		2.8		1,373.2
Public Utilities	7,121.7		901.2		25.7		7,997.2
Mortgage/Asset-Backed Securities	1,858.7		184.6		4.0		2,039.3
All Other Corporate Bonds	25,315.2		2,828.3		225.8		27,917.7
Redeemable Preferred Stocks	33.0		4.7		—		37.7
Total Fixed Maturity Securities	$	38,289.6	$	4,358.7	$	303.9	$	42,344.4

Length of Time Fixed Maturity Securities had been in a Gross Unrealized Loss Position

The following charts indicate the length of time our fixed maturity securities have been in a gross unrealized loss position.

	September 30, 2014
	Less Than 12 Months				12 Months or Greater
	Fair Value		Gross Unrealized Loss		Fair Value		Gross Unrealized Loss
	(in millions of dollars)
United States Government and Government Agencies and Authorities	$	—	$	—	$	6.5	$	1.4
States, Municipalities, and Political Subdivisions	58.5		0.7		70.8		3.1
Public Utilities	28.6		0.4		114.7		4.2
Mortgage/Asset-Backed Securities	8.0		—		17.4		0.6
All Other Corporate Bonds	1,473.4		30.9		907.6		43.3
Total Fixed Maturity Securities	$	1,568.5	$	32.0	$	1,117.0	$	52.6

	December 31, 2013
	Less Than 12 Months				12 Months or Greater
	Fair Value		Gross Unrealized Loss		Fair Value		Gross Unrealized Loss
	(in millions of dollars)
United States Government and Government Agencies and Authorities	$	41.1	$	3.1	$	5.2	$	2.5
States, Municipalities, and Political Subdivisions	412.5		33.5		37.2		6.5
Foreign Governments	87.2		2.8		—		—
Public Utilities	506.0		23.7		27.5		2.0
Mortgage/Asset-Backed Securities	341.0		3.6		2.5		0.4
All Other Corporate Bonds	3,776.9		197.4		238.6		28.4
Total Fixed Maturity Securities	$	5,164.7	$	264.1	$	311.0	$	39.8

Distribution of the Maturity Dates for Fixed Maturity Securities

The following is a distribution of the maturity dates for fixed maturity securities. The maturity dates have not been adjusted for possible calls or prepayments.

	September 30, 2014
	Total Amortized Cost		Unrealized Gain Position				Unrealized Loss Position
			Gross Gain		Fair Value		Gross Loss		Fair Value
	(in millions of dollars)
1 year or less	$	1,165.8	$	29.5	$	1,195.3	$	—	$	—
Over 1 year through 5 years	6,938.3		749.6		7,642.5		0.3		45.1
Over 5 years through 10 years	9,566.8		996.7		9,052.8		43.5		1,467.2
Over 10 years	18,939.7		3,911.1		21,662.8		40.2		1,147.8
	36,610.6		5,686.9		39,553.4		84.0		2,660.1
Mortgage/Asset-Backed Securities	2,309.8		192.5		2,476.3		0.6		25.4
Total Fixed Maturity Securities	$	38,920.4	$	5,879.4	$	42,029.7	$	84.6	$	2,685.5

	December 31, 2013
	Total Amortized Cost		Unrealized Gain Position				Unrealized Loss Position
			Gross Gain		Fair Value		Gross Loss		Fair Value
	(in millions of dollars)
1 year or less	$	903.9	$	20.6	$	915.5	$	—	$	9.0
Over 1 year through 5 years	7,098.2		727.1		7,678.5		0.6		146.2
Over 5 years through 10 years	9,492.6		940.2		8,137.4		95.8		2,199.6
Over 10 years	18,936.2		2,486.2		18,441.5		203.5		2,777.4
	36,430.9		4,174.1		35,172.9		299.9		5,132.2
Mortgage/Asset-Backed Securities	1,858.7		184.6		1,695.8		4.0		343.5
Total Fixed Maturity Securities	$	38,289.6	$	4,358.7	$	36,868.7	$	303.9	$	5,475.7

Mortgage Loans by Property Type and Geographic Region

Mortgage loans by property type and geographic region are presented below.

	September 30, 2014				December 31, 2013
	(in millions of dollars)
	Carrying		Percent of		Carrying		Percent of
	Amount		Total		Amount		Total
Property Type
Apartment	$	85.6	4.7	%	$	61.1	3.3	%
Industrial	522.1		28.9		567.8		31.3
Office	792.1		43.8		776.5		42.8
Retail	407.7		22.6		409.7		22.6
Total	$	1,807.5	100.0	%	$	1,815.1	100.0	%

Region
New England	$	111.9	6.2	%	$	100.9	5.6	%
Mid-Atlantic	180.9		10.0		191.5		10.5
East North Central	230.4		12.7		244.3		13.5
West North Central	168.0		9.3		162.3		8.9
South Atlantic	445.1		24.6		447.7		24.7
East South Central	65.7		3.6		67.7		3.7
West South Central	200.4		11.1		190.9		10.5
Mountain	107.5		6.0		101.9		5.6
Pacific	297.6		16.5		307.9		17.0
Total	$	1,807.5	100.0	%	$	1,815.1	100.0	%

Mortgage Loans Sorted by Internal Credit Ratings and Loan-to-Value Ratios

Mortgage loans, sorted by the applicable credit quality indicators, are as follows:

	September 30 2014		December 31 2013
	(in millions of dollars)
Internal Rating
Aa	$	7.8	$	10.8
A	693.1		683.1
Baa	1,062.2		1,094.6
Ba	13.2		13.5
B	31.2		13.1
Total	$	1,807.5	$	1,815.1

Loan-to-Value Ratio
<= 65%	$	871.0	$	777.4
> 65% <= 75%	806.1		867.5
> 75% <= 85%	76.7		107.6
> 85%	53.7		62.6
Total	$	1,807.5	$	1,815.1

Troubled Debt Restructurings

A summary of our troubled debt restructurings for the nine months ended September 30, 2014 and 2013 is as follows:

	Nine Months Ended September 30
	2014		2013
	(in millions of dollars)
Foreclosure
Carrying Amount	$	—	$	4.3
Number of Loans	—		1
Modification of Loan Terms
Carrying Amount	$	18.1	$	—
Realized Loss	$	3.0	$	—
Number of Loans	1		—

Activity in the Allowance for Credit Losses

The activity in the allowance for credit losses is as follows:

	Three Months Ended September 30				Nine Months Ended September 30
	2014		2013		2014		2013
	(in millions of dollars)
Balance at Beginning of Period	$	4.5	$	1.5	$	1.5	$	1.5
Provision	—		—		3.0		—
Balance at End of Period	$	4.5	$	1.5	$	4.5	$	1.5

Impaired Mortgage Loans

Impaired mortgage loans are as follows:

	September 30, 2014
	(in millions of dollars)
			Unpaid
	Recorded		Principal		Related
	Investment		Balance		Allowance
With an Allowance Recorded	$	31.2	$	35.7	$	4.5
	December 31, 2013
	(in millions of dollars)
			Unpaid
	Recorded		Principal		Related
	Investment		Balance		Allowance
With an Allowance Recorded	$	13.1	$	14.6	$	1.5

Schedule of Financial Instrument and Derivative Offsetting

Shown below are our financial instruments that either meet the accounting requirements that allow them to be offset in our balance sheets or that are subject to an enforceable master netting arrangement or similar agreement. Our accounting policy is to not offset these financial instruments in our balance sheets. Net amounts disclosed below have been reduced by the amount of collateral pledged to or received from our counterparties.

	September 30, 2014
	Gross Amount						Gross Amount Not
	of Recognized		Gross Amount		Net Amount		Offset in Balance Sheet
	Financial		Offset in		Presented in		Financial			Cash			Net
	Instruments		Balance Sheet		Balance Sheet		Instruments			Collateral			Amount
	(in millions of dollars)
Financial Assets:
Derivatives	$	15.1	$	—	$	15.1	$	(6.3	)	$	(8.1	)	$	0.7
Securities Lending	174.1		—		174.1		(103.9		)	(70.2		)	—
Total	$	189.2	$	—	$	189.2	$	(110.2	)	$	(78.3	)	$	0.7
Financial Liabilities:
Derivatives	$	107.2	$	—	$	107.2	$	(76.9	)	$	—		$	30.3
Securities Lending	70.2		—		70.2		(70.2		)	—			—
Total	$	177.4	$	—	$	177.4	$	(147.1	)	$	—		$	30.3

	December 31, 2013
	Gross Amount						Gross Amount Not
	of Recognized		Gross Amount		Net Amount		Offset in Balance Sheet
	Financial		Offset in		Presented in		Financial			Cash			Net
	Instruments		Balance Sheet		Balance Sheet		Instruments			Collateral			Amount
	(in millions of dollars)
Financial Assets:
Derivatives	$	10.8	$	—	$	10.8	$	(9.5	)	$	(1.1	)	$	0.2
Securities Lending	201.6		—		201.6		(125.1		)	(76.5		)	—
Total	$	212.4	$	—	$	212.4	$	(134.6	)	$	(77.6	)	$	0.2
Financial Liabilities:
Derivatives	$	135.6	$	—	$	135.6	$	(98.6	)	$	—		$	37.0
Securities Lending	76.5		—		76.5		(76.5		)	—			—
Total	$	212.1	$	—	$	212.1	$	(175.1	)	$	—		$	37.0

Net Investment Income

Net Investment Income

Net investment income reported in our consolidated statements of income is as follows:

	Three Months Ended September 30				Nine Months Ended September 30
	2014		2013		2014		2013
	(in millions of dollars)
Fixed Maturity Securities	$	578.8	$	584.2	$	1,749.5	$	1,771.3
Derivatives	10.1		8.9		30.3		25.6
Mortgage Loans	25.8		28.5		80.8		81.6
Policy Loans	4.2		4.0		12.1		11.6
Other Long-term Investments	2.6		4.0		18.3		14.5
Short-term Investments	0.6		0.5		1.7		1.9
Gross Investment Income	622.1		630.1		1,892.7		1,906.5
Less Investment Expenses	7.0		7.2		21.9		21.1
Less Investment Income on Participation Fund Account Assets	3.7		3.9		11.3		11.8
Less Amortization of Tax Credit Partnerships	5.0		3.5		11.5		10.9
Net Investment Income	$	606.4	$	615.5	$	1,848.0	$	1,862.7

Realized Investment Gains and Losses

Realized Investment Gain and Loss

Realized investment gains and losses, which for sales are based upon specific identification of the investments sold, are as follows:

	Three Months Ended September 30						Nine Months Ended September 30
	2014			2013			2014			2013
	(in millions of dollars)
Fixed Maturity Securities
Gross Gains on Sales	$	3.2		$	4.3		$	5.1		$	13.5
Gross Losses on Sales	(0.4		)	(33.0		)	(6.9		)	(40.1		)
Other-Than-Temporary Impairment Loss	—			—			—			(0.8		)
Mortgage Loans and Other Invested Assets
Gross Gains on Sales	1.8			5.6			11.6			14.6
Gross Losses on Sales	(0.1		)	—			(0.7		)	—
Impairment Loss	—			(1.0		)	(3.4		)	(2.0		)
Embedded Derivative in Modified Coinsurance Arrangement	(2.3		)	(0.3		)	18.6			18.5
All Other Derivatives	(0.7		)	(1.0		)	11.6			(1.5		)
Foreign Currency Transactions	(0.3		)	(0.7		)	(2.5		)	(4.7		)
Net Realized Investment Gain (Loss)	$	1.2		$	(26.1	)	$	33.4		$	(2.5	)