Employee Share-Based Incentive Compensation Plans

9 Months Ended

Sep. 30, 2019

Share-based Payment Arrangement [Abstract]

Employee Share-Based Incentive Compensation Plans

White Mountains’s Long-Term Incentive Plan (the “WTM Incentive Plan”) provides for grants of various types of share-based and non-share-based incentive awards to key employees of White Mountains. As of September 30, 2019, White Mountains’s share-based compensation incentive awards consist of performance shares and restricted shares.

Performance Shares

Performance shares are conditional grants of a specified maximum number of common shares or an equivalent amount of cash. Awards generally vest at the end of a three-year period, are subject to the attainment of pre-specified performance goals, and are valued based on the market value of common shares at the time awards are approved for payment.

The following table presents the performance share activity for the three and nine months ended September 30, 2019 and 2018 for performance shares granted under the WTM Incentive Plan:



	Three Months Ended September 30,							Nine Months Ended September 30,
	2019			2018				2019					2018
Millions, except share amounts	Target Performance Shares Outstanding	Accrued Expense		Target Performance Shares Outstanding	Accrued Expense			Target Performance Shares Outstanding		Accrued Expense			Target Performance Shares Outstanding		Accrued Expense
Beginning of period	42,473	$	30.8	40,616	$	27.2		40,616		$	31.7		50,515		$	45.8
Shares paid ⁽¹⁾	—	—		—	—			(13,715	)	(18.1		)	(23,186	)	(28.4		)
New grants	—	—		—	—			15,600		—			14,105		—
Forfeitures and cancellations⁽²⁾	—	—		—	(.1		)	(28	)	—			(818	)	.1
Expense recognized	—	5.6		—	7.8			—		22.8			—		17.4
End of period	42,473	$	36.4	40,616	$	34.9		42,473		$	36.4		40,616		$	34.9

⁽¹⁾WTM performance share payments in 2019 for the 2016-2018 performance cycle, which were paid in cash in March 2019, ranged from 139% to 166% of target. WTM performance share payments in 2018 for the 2015-2017 performance cycle, which were paid in cash in March 2018, ranged from 145% to 147% of target.

⁽²⁾Amounts include changes in assumed forfeitures, as required under GAAP.

For performance shares earned in the 2016-2018 and 2015-2017 performance cycles, all performance shares earned were settled in cash. If all the outstanding WTM performance shares had vested on September 30, 2019, the total additional compensation cost to be recognized would have been $21.1 million, based on accrual factors (common share price and payout assumptions) as of September 30, 2019.

The following table presents performance shares outstanding and accrued expense for performance shares awarded under the WTM Incentive Plan as of September 30, 2019 for each performance cycle:



	Nine Months Ended September 30, 2019
Millions, except share amounts	Target Performance Shares Outstanding		Accrued Expense
Performance cycle:
2017 – 2019	14,070		$	24.4
2018 – 2020	13,450		8.5
2019 – 2021	15,600		4.0
Sub-total	43,120		36.9
Assumed forfeitures	(647	)	(.5		)
September 30, 2019	42,473		$	36.4

Restricted Shares

The following table presents the unrecognized compensation cost associated with the outstanding restricted share awards for the three and nine months ended September 30, 2019 and 2018:



	Three Months Ended September 30,								Nine Months Ended September 30,
	2019				2018				2019					2018
Millions, except share amounts	Restricted Shares	Unamortized Issue Date Fair Value			Restricted Shares	Unamortized Issue Date Fair Value			Restricted Shares		Unamortized Issue Date Fair Value			Restricted Shares		Unamortized Issue Date Fair Value
Non-vested,
Beginning of period	43,395	$	21.9		41,510	$	19.0		41,510		$	12.5		53,755		$	14.3
Issued	—	—			—	—			15,600		14.5			14,105		11.4
Vested	—	—			—	—			(13,715	)	—			(25,381	)	—
Forfeited	—	—			—	—			—		—			(969	)	(.2		)
Expense recognized	—	(2.6		)	—	(3.2		)	—		(7.7		)	—		(9.7		)
End of period	43,395	$	19.3		41,510	$	15.8		43,395		$	19.3		41,510		$	15.8

During the nine months ended September 30, 2019, White Mountains issued 15,600 restricted shares that vest on January 1, 2022. During the nine months ended September 30, 2018, White Mountains issued 13,450 restricted shares that vest on January 1, 2021, 290 restricted shares that vest on January 1, 2020 and 365 restricted shares that vested on January 1, 2019. The unamortized issue date fair value as of September 30, 2019 is expected to be recognized ratably over the remaining vesting periods.