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Financial Guarantee Insurance Contracts (Tables)
 9 Months Ended
Sep. 30, 2020
Insurance [Line Items]  
Schedule of Loss And Loss Expense Reserves And Subrogation Recoverable Table [Table Text Block] Below are the components of the loss reserves liability and the Subrogation recoverable asset at September 30, 2020 and December 31, 2019:
September 30, 2020:December 31, 2019:
Present Value of Expected
Net Cash Flows		Unearned
Premium
Revenue		Gross Loss and
Loss Expense
Reserves		Present Value of Expected
Net Cash Flows		Unearned
Premium
Revenue		Gross Loss and
Loss Expense
Reserves
Balance Sheet Line ItemClaims and
Loss Expenses		RecoveriesClaims and
Loss Expenses		Recoveries
Loss and loss expense reserves$2,116 $(235)$(80)$1,801 $1,835 $(233)$(54)$1,548 
Subrogation recoverable109 (2,303)— (2,194)131 (2,160)— (2,029)
Totals$2,225 $(2,538)$(80)$(393)$1,966 $(2,394)$(54)$(482)
Summary of Gross Premium Receivable Roll-Forward (Direct and Assumed Contracts)
Below is the gross premium receivable roll-forward for the respective periods, net of allowance for credit losses:
Nine Months Ended September 30,
20202019
Beginning premium receivable$416 $495 
Adjustment to initially apply ASU 2016-13(3)— 
Premium receipts(36)(37)
Adjustments for changes in expected and contractual cash flows (1)
(4)(33)
Accretion of premium receivable discount7 9 
Deconsolidation of certain VIEs— 3 
Changes to allowance for credit losses(5)(7)
Other adjustments (including foreign exchange)(2)(16)
Ending premium receivable (2)
$372 $415 
(1)    Adjustments for changes in expected and contractual cash flows primarily due to reductions in insured exposure as a result of early policy terminations and unscheduled principal paydowns.
(2)    Premium receivable includes premiums to be received in foreign denominated currencies most notably in British Pounds and Euros.
At September 30, 2020 and 2019, premium receivables include British Pounds of $112 (£87) and $124 (£101), respectively, and Euros of $21 (€18) and $22 (€20), respectively.
Effect of Reinsurance on Premiums Written and Earned
The effect of reinsurance on premiums written and earned for the respective periods was as follows:
Three Months Ended September 30,
20202019
WrittenEarnedWrittenEarned
Direct$(13)$18 $(13)$13 
Assumed— — — — 
Ceded— 3 23 3 
Net premiums$(13)$15 $(36)$10 
Nine Months Ended September 30,
20202019
WrittenEarnedWrittenEarned
Direct$(2)$45 $(31)$53 
Assumed— 1 — — 
Ceded(1)9 22 7 
Net premiums$(2)$36 $(53)$46 
Schedule of Revenue from External Customers Attributed to Foreign Countries by Geographic Area [Table Text Block]
The following table summarizes net premiums earned by location of risk for the respective periods:
Three Months Ended September 30,Nine Months Ended September 30,
2020201920202019
United States$9 $11 $24 $44 
United Kingdom7 4 15 13 
Other international(1)(4)(2)(11)
Total$15 $10 $36 $46 
Summarized Future Gross Undiscounted Premiums Expected to be Collected and Future Expected Premiums Earned, Net of Reinsurance
The table below summarizes the future gross undiscounted premiums to be collected and future premiums earned, net of reinsurance at September 30, 2020:
Future Premiums
to be
Collected (1)
Future
Premiums to
be Earned Net of
Reinsurance (2)
Three months ended:
December 31, 2020$11 $10 
Twelve months ended:
December 31, 202136 35 
December 31, 202234 33 
December 31, 202333 30 
December 31, 202431 29 
Five years ended:
December 31, 2029138 120 
December 31, 2034101 81 
December 31, 203950 37 
December 31, 204422 14 
December 31, 20499 5 
December 31, 20541 1 
Total$467 $395 
(1)Future premiums to be collected are undiscounted, gross of allowance for credit losses, and are used to derive the discounted premium receivable asset recorded on Ambac's balance sheet.
(2)Future premiums to be earned, net of reinsurance relate to the unearned premiums liability and deferred ceded premium asset recorded on Ambac’s balance sheet. The use of contractual lives for many bond types which do not have homogeneous pools of underlying collateral is required in the calculation of the premium receivable, as further described in Note 2. Basis of Presentation and Significant Accounting Policies in the Notes to Consolidated Financial Statements included in Ambac's Annual Report on Form 10-K for the year ended December 31, 2019. This results in a different premium receivable balance than if expected lives were considered. If installment paying policies are retired or prepay early, premiums reflected in the premium receivable asset and amounts reported in the above table for such policies may not be collected. Future premiums to be earned also considers the use of contractual lives for many bond types which do not have homogeneous pools of underlying collateral, which may result in different unearned premium than if expected lives were considered. If those bonds types are retired early, premium earnings may be negative in the period of call or refinancing
Premiums Receivable by Risk Classification Code [Table Text Block] Below is the amortized cost basis of premium receivables by risk classification code and asset class as of September 30, 2020:
Surveillance Categories as of September 30, 2020
Type of Guaranteed BondIIAIIIIIIVTotal
Public Finance:
Housing revenue$158 $13 $— $— $— $171 
Other2 13 — — — 16 
Total Public Finance160 26 — — — 186 
Structured Finance:
Mortgage-backed and home equity3 1 3 16 23 
Structured insurance16 — — — — 16 
Student loan3 — 2 12 — 17 
Other7 — — — — 7 
Total Structured Finance29 — 3 15 16 63 
International:
Sovereign/sub-sovereign78 13 — 15 — 105 
Investor-owned and public utilities29 — — — — 29 
Other6 — — — — 6 
Total International113 13 — 15 — 141 
Total (1)
$302 $39 $3 $29 $16 $390 
(1)    The underwriting origination dates for all policies included are greater than five years prior to the current reporting date.
Premium Receivable, Allowance for Credit Loss [Table Text Block]
Below is a rollforward of the premium receivable allowance for credit losses as of September 30, 2020:
Three Months Ended September 30, 2020Nine Months Ended September 30, 2020
Beginning balance (1)
$16 $9 
Current period provision (2)
2 9 
Write-offs of the allowance— — 
Recoveries of previously written-off amounts— — 
Ending balance$18 $18 

(1)At December 31, 2019, $9 of premiums receivable were deemed uncollectible as determined under prior GAAP rules.
(2)The nine months ended September 30, 2020, includes $3 from the adoption of CECL.
Summary of Loss Reserve Roll-Forward, Net of Subrogation Recoverable and Reinsurance
Below is the loss reserves roll-forward, net of subrogation recoverable and reinsurance, for the affected periods:
Nine Months Ended September 30,
20202019
Beginning gross loss and loss expense reserves$(482)$(107)
Reinsurance recoverable26 23 
Beginning balance of net loss and loss expense reserves(508)(130)
Losses and loss expenses (benefit):
Current year18 1 
Prior years
198 (85)
Total (1) (2)
216 (84)
Loss and loss expenses paid (recovered):
Current year1 — 
Prior years137 299 
Total
138 299 
Foreign exchange effect
1 (1)
Ending net loss and loss expense reserves
(429)(514)
Impact of VIE consolidation— (72)
Reinsurance recoverable (3)
36 26 
Ending gross loss and loss expense reserves$(393)$(560)
(1)Total losses and loss expenses (benefit) includes $(14) and $(6) for the nine months ended September 30, 2020 and 2019, respectively, related to ceded reinsurance.
(2)Ambac records the impact of estimated recoveries related to securitized loans in RMBS transactions that breached certain representations and warranties ("R&W's) by transaction sponsors within losses and loss expenses (benefit). The losses and loss expense (benefit) incurred associated with changes in estimated R&W's for the nine months ended September 30, 2020 and 2019, was $(29) and $15, respectively.
(3)Represents reinsurance recoverable on future loss and loss expenses. Additionally, the Balance Sheet line "Reinsurance recoverable on paid and unpaid losses" includes reinsurance recoverables (payables) of $1 and $0 as of September 30, 2020 and 2019, respectively, related to previously presented loss and loss expenses and subrogation.
Summary of Information Related to Policies Currently Included in Ambac's Loss Reserves or Subrogation Recoverable
The tables below summarize information related to policies currently included in Ambac’s loss reserves or subrogation recoverable at September 30, 2020 and December 31, 2019. Gross par exposures include capital appreciation bonds which are reported at the par amount at the time of issuance of the insurance policy as opposed to the current accreted value of the bond. The weighted average risk-free rate used to discount loss reserves at September 30, 2020 and December 31, 2019,was 0.9% and 2.1%, respectively.
Surveillance Categories as of September 30, 2020
IIAIIIIIIVVTotal
Number of policies46 26 16 16 135 3 242 
Remaining weighted-average contract period (in years) (1)
101981614215
Gross insured contractual payments outstanding:
Principal$1,064 $1,146 $614 $1,511 $3,386 $32 $7,752 
Interest329 1,083 492 260 1,465 10 3,639 
Total$1,393 $2,229 $1,106 $1,771 $4,851 $41 $11,391 
Gross undiscounted claim liability$4 $56 $41 $536 $1,726 $41 $2,404 
Discount, gross claim liability— (2)(1)(71)(185)— (259)
Gross claim liability before all subrogation and before reinsurance
4 54 41 465 1,541 41 2,145 
Less:
Gross RMBS subrogation (2)
— — — — (1,760)— (1,760)
Discount, RMBS subrogation— — — — 2 — 2 
Discounted RMBS subrogation, before reinsurance
— — — — (1,757)— (1,757)
Less:
Gross other subrogation (3)
— — — (37)(749)(13)(799)
Discount, other subrogation— — — 1 16 1 18 
Discounted other subrogation, before reinsurance
— — — (36)(734)(11)(781)
Gross claim liability, net of all subrogation and discounts, before reinsurance
4 54 40 429 (950)30 (393)
Less: Unearned premium revenue(3)(22)(5)(18)(32)— (80)
Plus: Loss expense reserves2 2 1 7 68 — 80 
Gross loss and loss expense reserves$2 $34 $37 $418 $(913)$30 $(393)
Reinsurance recoverable reported on Balance Sheet (4)
$— $6 $10 $27 $(6)$— $37 
(1)Remaining weighted-average contract period is weighted based on projected gross claims over the lives of the respective policies.
(2)RMBS subrogation represents Ambac’s estimate of subrogation recoveries from RMBS transaction sponsors for R&W breaches.
(3)Other subrogation represents subrogation related to excess spread and other contractual cash flows on public finance and structured finance transactions, including RMBS.
(4)Reinsurance recoverable reported on the Balance Sheet includes reinsurance recoverables of $36 related to future loss and loss expenses and $1 related to presented loss and loss expenses and subrogation.
Surveillance Categories as of December 31, 2019
IIAIIIIIIVVTotal
Number of policies34 18 11 16 139 3 221 
Remaining weighted-average contract period (in years) (1)
82191714315
Gross insured contractual payments outstanding:
Principal$668 $510 $277 $857 $3,819 $37 $6,168 
Interest340 507 128 366 1,678 11 3,029 
Total$1,007 $1,016 $404 $1,223 $5,498 $48 $9,197 
Gross undiscounted claim liability$2 $44 $21 $541 $1,778 $48 $2,434 
Discount, gross claim liability— (5)(1)(152)(381)(2)(541)
Gross claim liability before all subrogation and before reinsurance
2 39 20 389 1,397 46 1,893 
Less:
Gross RMBS subrogation (2)
— — — — (1,777)— (1,777)
Discount, RMBS subrogation— — — — 49 — 49 
Discounted RMBS subrogation, before reinsurance
— — — — (1,727)— (1,727)
Less:
Gross other subrogation (3)
— — — (41)(666)(13)(720)
Discount, other subrogation— — — 4 47 3 53 
Discounted other subrogation, before reinsurance
— — — (37)(620)(10)(666)
Gross claim liability, net of all subrogation and discounts, before reinsurance
2 39 20 353 (950)36 (501)
Less: Unearned premium revenue(1)(9)(1)(7)(35)— (54)
Plus: Loss expense reserves1 1 1 4 67 — 73 
Gross loss and loss expense reserves$1 $30 $20 $349 $(918)$36 $(482)
Reinsurance recoverable reported on Balance Sheet (4)
$— $6 $7 $24 $(10)$— $26 
(1)Remaining weighted-average contract period is weighted based on projected gross claims over the lives of the respective policies.
(2)RMBS subrogation represents Ambac’s estimate of subrogation recoveries from RMBS transaction sponsors for R&W breaches.
(3)Other subrogation represents subrogation related to excess spread and other contractual cash flows on public finance and structured finance transactions, including RMBS.
(4)Reinsurance recoverable reported on Balance Sheet includes reinsurance recoverables of $26 related to future loss and loss expenses and $0 related to presented loss and loss expenses and subrogation.
Summary of Rollforward of RMBS Subrogation, by Estimation Approach
Below is the rollforward of R&W subrogation for the affected periods:
Nine Months Ended September 30,
20202019
Discounted R&W subrogation (gross of reinsurance) at beginning of period$1,727 $1,771 
All other changes (1)
30 (16)
Discounted R&W subrogation (gross of reinsurance) at end of period$1,757 $1,755 
(1)All other changes which may impact RMBS R&W subrogation recoveries include changes in actual or projected collateral performance, changes in the creditworthiness of a sponsor and/or the projected timing of recoveries.
Intangible Assets Disclosure [Text Block]
The insurance intangible amortization expense is included in the Consolidated Statements of Total Comprehensive Income (Loss), as shown below.
Three Months Ended September 30,Nine Months Ended September 30,
2020201920202019
Insurance amortization expense
$14 $17 $41 $280 
The insurance intangible asset and accumulated amortization are included in the Consolidated Balance Sheets, as shown below.
September 30,
2020		December 31,
2019
Gross carrying value of insurance intangible asset
$1,268 $1,273 
Accumulated amortization of insurance intangible asset
885 847 
Net insurance intangible asset
$383 $427 
Insurance Intangible Asset [Member]  
Insurance [Line Items]  
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]
The estimated future amortization expense for the net insurance intangible asset is as follows:
Amortization expense (1) (2)
2020 (three months)$11 
202139 
202235 
202332 
202429 
Thereafter239 
(1)The insurance intangible asset will be amortized using a level-yield method based on par exposure of the related financial guarantee insurance or reinsurance contracts. Future amortization considers the use of contractual lives for many bond types which do not have homogeneous pools of underlying collateral. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay certain obligations. If those bonds types are retired early, amortization expense may differ in the period of call or refinancing.
(2)The weighted-average amortizations period is 7.6 years.