Income Tax (Tables)

12 Months Ended

Dec. 31, 2018

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

Total income tax expense (benefit) is allocated as follows:

	Year Ended December 31
	2018			2017			2016
	(in millions of dollars)
Net Income	$	104.4		$	409.8		$	416.3
Stockholders' Equity - Additional Paid-in Capital
Stock-Based Compensation	—			—			(0.3		)
Stockholders' Equity - Accumulated Other Comprehensive Income (Loss)
Change in Net Unrealized Gain on Securities Before Adjustment	(614.2		)	328.1			318.0
Change in Adjustment to Deferred Acquisition Costs and Reserves for Future Policy and Contract Benefits, Net of Reinsurance	371.7			(245.0		)	(200.6		)
Change in Net Gain on Hedges	(8.2		)	(24.4		)	(25.4		)
Change in Foreign Currency Translation Adjustment	(0.6		)	—			—
Change in Unrecognized Pension and Postretirement Benefit Costs	17.0			(8.3		)	(34.2		)
Total	$	(129.9	)	$	460.2		$	473.8

Schedule of Effective Income Tax Rate Reconciliation

A reconciliation of the income tax provision at the U.S. federal statutory rate to the income tax rate as reported in our consolidated statements of income is as follows. Certain prior year amounts have been reclassified to conform to current year

reporting.

	Year Ended December 31
	2018		2017		2016
Statutory Income Tax	21.0	%	35.0	%	35.0	%
Foreign Rate Differential, Inclusive of Foreign Rate Changes	(0.3	)	(1.1	)	(2.2	)
U.S. Deferred Tax Liability Remeasurement	—		(7.0	)	—
Deemed Repatriation Tax on Foreign Earnings and Profit (E&P)	1.8		4.7		—
Tax Exempt Income	(1.3	)	(0.8	)	(0.8	)
Tax Credits	(2.4	)	(1.5	)	(1.6	)
Policyholder Reserves	(2.4	)	—		—
Other Items, Net	0.2		(0.1	)	0.5
Effective Tax	16.6	%	29.2	%	30.9	%

Schedule of Deferred Tax Assets and Liabilities

Our net deferred tax (asset) liability consists of the following:

	December 31
	2018			2017
	(in millions of dollars)
Deferred Tax Liability
Deferred Acquisition Costs	$	129.7		$	118.6
Fixed Assets	56.2			52.8
Invested Assets	493.4			1,074.0
Intangible Assets	24.0			6.5
Other	34.1			35.8
Gross Deferred Tax Liability	737.4			1,287.7
Deferred Tax Asset
Reserves	668.5			908.0
Employee Benefits	179.5			188.7
Other	17.7			12.3
Gross Deferred Tax Asset	865.7			1,109.0
Less: Valuation Allowance	18.4			20.3
Net Deferred Tax Asset	847.3			1,088.7
Net Deferred Tax (Asset) Liability	$	(109.9	)	$	199.0

Schedule of Income before Income Tax, Domestic and Foreign

Our consolidated statements of income include amounts subject to both domestic and foreign taxation. The income and related tax expense (benefit) are as follows. The federal statutory rates used were 21 percent for 2018 and 35 percent for 2017 and 2016:

	Year Ended December 31
	2018			2017			2016
	(in millions of dollars)
Income Before Tax
Domestic	$	492.6		$	1,289.0		$	1,215.8
Foreign	135.2			115.0			131.9
Total	$	627.8		$	1,404.0		$	1,347.7
Current Tax Expense (Benefit)
Federal	$	194.6		$	374.9		$	414.8
State and Local	(0.6		)	0.4			0.3
Foreign	33.4			26.0			(29.4		)
Total	227.4			401.3			385.7
Deferred Tax Expense (Benefit)
Federal	(114.6		)	14.2			(14.6		)
State and Local	(0.2		)	(0.3		)	(2.1		)
Foreign	(8.2		)	(5.4		)	47.3
Total	(123.0		)	8.5			30.6
Total Tax Expense	$	104.4		$	409.8		$	416.3

Summary of Positions for which Significant Change in Unrecognized Tax Benefits is Reasonably Possible

Our consolidated statements of income include the following changes in unrecognized tax benefits. Certain prior year amounts have been reclassified to conform to current year reporting.

	December 31
	2018			2017			2016
	(in millions of dollars)
Balance at Beginning of Year	$	1.4		$	1.5		$	0.8
Additions for Tax Positions Related to Prior Years	261.5			0.3			0.7
Additions for Tax Positions Related to Current Year	—			—			—
Settlements with Tax Authorities	—			—			—
Lapse of the Applicable Statute of Limitations	(0.7		)	(0.4		)	—
Balance at End of Year	262.2			1.4			1.5
Less Tax Attributable to Temporary Items Included Above	(148.2		)	—			—
Total Unrecognized Tax Benefits That if Recognized Would Affect the Effective Tax Rate	$	114.0		$	1.4		$	1.5