Income Taxes (Tables)

12 Months Ended

Dec. 31, 2021

Income Tax Disclosure [Abstract]

Schedule of total income tax benefit (expense)

The following table presents the total income tax (expense) benefit for the years ended December 31, 2021, 2020 and 2019:

	Year Ended December 31,
Millions	2021		2020		2019
Current income tax (expense) benefit:
U.S. federal	$	(3.8)	$	(10.4)	$	.9
State	(2.1)		(4.2)		(3.7)
Non-U.S.	(3.9)		(1.1)		(1.7)
Total current income tax (expense) benefit	(9.8)		(15.7)		(4.5)
Deferred income tax (expense) benefit:
U.S. federal	(4.9)		23.2		(14.9)
State	(5.6)		10.3		(10.4)
Non-U.S.	(18.3)		2.7		.5
Total deferred income tax (expense) benefit	(28.8)		36.2		(24.8)
Total income tax (expense) benefit	$	(38.6)	$	20.5	$	(29.3)

Schedule of U.S. federal statutory income tax rate and actual effective tax rate on pre-tax income

The following table presents a reconciliation of taxes calculated for 2021, 2020 and 2019 using the 21% U.S. federal statutory rate U.S. federal statutory rate (the tax rate at which the majority of White Mountains’s worldwide operations are taxed) to the income tax (expense) benefit on pre-tax income (loss):

	Year Ended December 31,
Millions	2021		2020		2019
Tax (expense) benefit at the U.S. statutory rate	$	63.4	$	(135.5)	$	(85.1)
Differences in taxes resulting from:
Non-U.S. earnings, net of foreign taxes	(77.2)		78.4		27.1
Tax rate changes	(11.2)		2.7		(5.7)
State taxes	(6.2)		(8.5)		(17.5)
Member’s surplus contributions	(5.6)		(4.8)		(3.6)
Change in valuation allowance	(2.4)		(29.2)		63.6
Officer compensation	(1.5)		(1.1)		—
Withholding tax	(.3)		(5.0)		(1.6)
Tax exempt interest and dividends	.2		.8		1.1
Reorganization	—		130.5		—
Tax reserve adjustments	—		1.9		(.7)
Other, net	2.2		(9.7)		(6.9)
Total income tax (expense) benefit on pre-tax income (loss)	$	(38.6)	$	20.5	$	(29.3)

Schedule of components of deferred income tax assets and liabilities

The following table presents an outline of the significant components of White Mountains’s U.S. federal, state and non-U.S. deferred tax assets and liabilities:

	December 31,
Millions	2021		2020
Deferred tax assets related to:
U.S. federal and state net operating and capital    loss carryforwards	$	102.8	$	79.6
Non-U.S. net operating loss carryforwards	47.1		50.5
Incentive compensation	14.6		17.5
Accrued interest	10.8		7.9
Deferred acquisition costs	6.4		5.5
Tax credit carryforwards	4.9		5.5
Other items	.7		1.3
Total gross deferred tax assets	187.3		167.8
Less: valuation allowances	92.3		97.4
Total net deferred tax assets	95.0		70.4
Deferred tax liabilities related to:
Member’s surplus contributions	60.4		52.9
Purchase accounting	48.5		5.1
Investment basis difference	33.7		11.8
Net unrealized investment gains (losses)	10.7		.3
Deferred underwriting	4.1		—
Other items	2.7		2.8
Total deferred tax liabilities	160.1		72.9
Net deferred tax asset (liability)	$	(65.1)	$	(2.5)

Schedule of net operating and capital loss carryforwards

The following table presents net operating loss and capital loss carryforwards as of December 31, 2021, the expiration dates and the deferred tax assets thereon:

	December 31, 2021
Millions	United States		Luxembourg		United Kingdom		Israel		Total
2021-2025	$	—	$	—	$	—	$	—	$	—
2026-2030	—		—		—		—		—
2031-2040	250.7		68.3		—		—		319.0
No expiration date	213.8		28.8		6.9		93.3		342.8
Total	$	464.5	$	97.1	$	6.9	$	93.3	$	661.8
Gross deferred tax asset	$	97.6	$	24.3	$	1.4	$	21.4	$	144.7
Valuation allowance	(83.2)		(24.3)		(.4)		(21.4)		(129.3)
Net deferred tax asset	$	14.4	$	—	$	1.0	$	—	$	15.4

Schedule of changes in amount of unrecognized tax benefits

The following table presents a reconciliation of the beginning and ending amount of unrecognized tax benefits from 2019 to 2021:

Millions	Permanent Differences (1)		Temporary Differences (2)		Interest and Penalties (3)		Total
Balance at December 31, 2018	$	1.1	$	—	$	—	$	1.1
Changes in prior year tax positions	1.3		—		—		1.3
Balance at December 31, 2019	2.4		—		—		2.4
Changes in prior year tax positions	.1		—		—		.1
Tax positions taken during the current year	.1		—		—		.1
Changes in prior year tax positions	(2.6)		—		—		(2.6)
Balance at December 31, 2020	—		—		—		—
Changes in prior year tax positions	—		—		—		—
Balance at December 31, 2021	$	—	$	—	$	—	$	—

(1)Represents the amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate.

(2)Represents the amount of unrecognized tax benefits that, if recognized, would create a temporary difference between the reported amount of an item in White Mountains’s Consolidated Balance Sheet and its tax basis.

(3)Net of tax benefit.