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Insurance Contracts (Tables)
 6 Months Ended
Jun. 30, 2022
Jun. 30, 2021
Insurance [Line Items]    
Schedule of Loss And Loss Expense Reserves And Subrogation Recoverable Table [Table Text Block]
Ambac’s loss and loss expense reserves (“loss reserves”) are based on management’s on-going review of the insured portfolio. Below are the components of the loss and loss expense reserves and the subrogation recoverable asset at at June 30, 2022 and December 31, 2021:
Legacy Financial Guarantee
Specialty Property and CasualtyPresent Value of Expected Net Cash Flows
Balance Sheet Line ItemGross Loss
and Loss
Expense
Reserves		Claims and
Loss Expenses		RecoveriesUnearned
Premium
Revenue		Gross Loss
and
Loss Expense
Reserves
June 30, 2022:
Loss and loss expense reserves$44 $1,101 $(87)$(38)$1,019 
Subrogation recoverable— 45 (1,712)— (1,667)
Totals$44 $1,146 $(1,799)$(38)$(647)
December 31, 2021:
Loss and loss expense reserves$32 $1,749 $(155)$(56)$1,570 
Subrogation recoverable— 88 (2,180)— (2,092)
Totals$32 $1,837 $(2,335)$(56)$(522)
  
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense
The estimated future amortization expense for finite-lived intangible assets is as follows:
Amortization expense
Insurance Intangible Asset (1)
Other Intangible Assets (1)
Total
2022 (Six months)$15 $1 $17 
202328 3 31 
202426 3 29 
202524 3 26 
202622 2 24 
Thereafter170 20 190 
(1)The weighted-average insurance intangible amortization and other intangible amortization periods are 7.3 years and 5.8 years, respectively. 		 
Premiums Receivable by Risk Classification Code [Table Text Block] Below is the amortized cost basis of financial guarantee premium receivables by risk classification code and asset class as of June 30, 2022 and December 31, 2021:
Surveillance Categories as of June 30, 2022
Type of Guaranteed BondIIAIIIIIIVTotal
Public Finance:
Housing revenue$145 $3 $5 $— $— $153 
Other2 — — — — 2 
Total Public Finance147 3 5 — — 155 
Structured Finance:
Mortgage-backed and home equity— — — — 12 13 
Structured insurance7 — — — — 7 
Student loan1 1 — 8 — 10 
Other5 — — — — 5 
Total Structured Finance14 1 — 8 12 34 
International:
Sovereign/sub-sovereign67 7 — 9 — 83 
Investor-owned and public utilities18 — — — — 18 
Other5 — — — — 5 
Total International89 7 — 9 — 106 
Total (1) (2)
$250 $11 $5 $17 $12 $295 
Surveillance Categories as of December 31, 2021
Type of Guaranteed BondIIAIIIIIIVTotal
Public Finance:
Housing revenue$149 $3 $5 $— $— $157 
Other2 — — — — 2 
Total Public Finance151 3 5 — — 159 
Structured Finance:
Mortgage-backed and home equity1 — 1 2 12 16 
Student loan1 1 — 9 — 12 
Structured insurance10 — — — — 10 
Other7 — — — — 7 
Total Structured Finance19 1 1 12 12 45 
International:
Sovereign/sub-sovereign74 8 — 11 — 93 
Investor-owned and public utilities28 — — — — 28 
Other5 — — — — 5 
Total International107 8 — 11 — 125 
Total (1) (2)
$277 $12 $6 $22 $12 $329 
(1)    Excludes specialty property and casualty premium receivables of $22 and $2 at June 30, 2022 and December 31, 2021, respectively.
(2)    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 June 30, 2022 and 2021:
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
Beginning balance$8 $13 $9 $17 
Current period provision (benefit)(1)(1)(2)(5)
Write-offs of the allowance(1)(1)(1)(1)
Recoveries of previously written-off amounts— — — — 
Ending balance (1)
$6 $11 $6 $11 
(1)At June 30, 2022 and 2021, $— and $— of premiums were past due.
Summary of Loss Reserve Roll-Forward, Net of Subrogation Recoverable and Reinsurance
Below is the loss and loss reserve expense roll-forward, net of subrogation recoverable and reinsurance, for the affected periods:
Six Months Ended June 30,20222021
Beginning gross loss and loss expense reserves$(522)$(397)
Reinsurance recoverable55 33 
Beginning balance of net loss and loss expense reserves(578)(430)
Losses and loss expenses (benefit):
Current year3 — 
Prior years9 (18)
Total (1) (2)
12 (18)
Loss and loss expenses paid (recovered):
Current year— — 
Prior years(158)38 
Total(157)38 
Foreign exchange effect(2)— 
Ending net loss and loss expense reserves (410)(486)
Impact of VIE consolidation(292)— 
Reinsurance recoverable (3)
55 30 
Ending gross loss and loss expense reserves$(647)$(456)
(1)Total losses and loss expenses (benefit) includes $(14) and $2 for the six months ended June 30, 2022 and 2021, 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) for the Legacy Financial Guarantee segment. The losses and loss expense incurred associated with changes in estimated R&W's for the six months ended June 30, 2022 and 2021, was $242 and $10, 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 $0 and $1 as of June 30, 2022 and 2021, 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 and loss expense reserves or subrogation recoverable at June 30, 2022 and December 31, 2021, excluding consolidated VIEs. 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 June 30, 2022 and December 31, 2021,was 3.0% and 1.2%, respectively.
Surveillance Categories as of June 30, 2022
IIAIIIIIIVVTotal
Number of policies30 9 8 13 132 5 197 
Remaining weighted-average contract period (in years) (1)
819141413713
Gross insured contractual payments outstanding:
Principal$922 $241 $464 $1,027 $2,184 $34 $4,871 
Interest515 210 297 158 690 21 1,890 
Total$1,437 $451 $760 $1,185 $2,873 $56 $6,761 
Gross undiscounted claim liability$6 $5 $44 $430 $1,012 $56 $1,553 
Discount, gross claim liability— (1)(6)(132)(293)(8)(440)
Gross claim liability before all subrogation and before reinsurance6 4 38 298 719 47 1,112 
Less:
Gross RMBS subrogation (2)
— — — — (1,531)— (1,531)
Discount, RMBS subrogation— — — — 47 — 47 
Discounted RMBS subrogation, before reinsurance— — — — (1,484)— (1,484)
Less:
Gross other subrogation (3)
— (5)— (32)(312)(12)(361)
Discount, other subrogation— — — 4 38 3 45 
Discounted other subrogation, before reinsurance— (4)— (28)(274)(9)(316)
Gross claim liability, net of all subrogation and discounts, before reinsurance6 — 38 270 (1,040)38 (687)
Less: Unearned premium revenue(4)(3)(5)(9)(17)(1)(38)
Plus: Loss expense reserves— — — 2 31 — 34 
Gross loss and loss expense reserves$3 $(3)$34 $264 $(1,026)$38 $(691)
Reinsurance recoverable reported on Balance Sheet (4)
$1 $— $9 $22 $(18)$— $14 
(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 representation and warranty ("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 $14 related to future loss and loss expenses and $— related to presented loss and loss expenses and subrogation.
Surveillance Categories as of December 31, 2021
IIAIIIIIIVVTotal
Number of policies34 15 7 14 130 5 205 
Remaining weighted-average contract period (in years) (1)
912141513714
Gross insured contractual payments outstanding:
Principal$904 $840 $459 $1,300 $2,759 $40 $6,302 
Interest589 612 308 169 1,284 22 2,984 
Total$1,493 $1,452 $767 $1,469 $4,043 $62 $9,286 
Gross undiscounted claim liability$5 $16 $45 $544 $1,423 $62 $2,095 
Discount, gross claim liability— (1)(3)(109)(185)(4)(303)
Gross claim liability before all subrogation and before reinsurance5 15 42 435 1,238 57 1,792 
Less:
Gross RMBS subrogation (2)
— — — — (1,737)— (1,737)
Discount, RMBS subrogation— — — — 7 — 7 
Discounted RMBS subrogation, before reinsurance— — — — (1,730)— (1,730)
Less:
Gross other subrogation (3)
— (5)— (33)(583)(12)(633)
Discount, other subrogation— — — 2 24 2 28 
Discounted other subrogation, before reinsurance— (5)— (31)(559)(10)(605)
Gross claim liability, net of all subrogation and discounts, before reinsurance5 10 42 404 (1,051)47 (543)
Less: Unearned premium revenue(3)(10)(5)(14)(24)(1)(56)
Plus: Loss expense reserves1 — — 4 40 — 45 
Gross loss and loss expense reserves$3 $1 $38 $394 $(1,036)$46 $(554)
Reinsurance recoverable reported on Balance Sheet (4)
$1 $1 $10 $22 $(11)$— $23 
(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 $24 related to future loss and loss expenses and $— related to presented loss and loss expenses and subrogation.
  
Summary of Rollforward of RMBS Subrogation, by Estimation Approach The reduction in recorded RMBS R&W recoveries since December 31, 2021, is primarily attributable to management’s view of the effect on certain of AAC’s R&W litigations of the March 17, 2022 decision of the New York Court of Appeals in the case entitled U.S. Bank National Association v. DLJ Mortgage Capital, Inc. relating to Home Equity Asset Trust 2007-1, a residential mortgage-backed securities trust. The decision is relevant to AAC's breach-of-contract cases relating to its insured RMBS transactions and may affect one of the bases upon which AAC seeks recovery with respect to a significant portion of breaching loans in AAC's RMBS cases. However, management believes there remain other alternative paths to recovery for such breaching loans.  
Effects of Reinsurance
The effect of reinsurance on premiums written and earned was as follows:
Three Months Ended June 30,
20222021
WrittenEarnedWrittenEarned
Direct$37 $30 $(3)$14 
Assumed— — — — 
Ceded$27 $16 9 3 
Net premiums9 14 $(13)$11 
Six Months Ended June 30,
20222021
WrittenEarnedWrittenEarned
Direct$67 $53 $(5)$31 
Assumed— — — — 
Ceded$46 $24 16 6 
Net premiums21 28 $(21)$25 
The following table summarizes net premiums earned by location of risk:
Three Months Ended June 30,Six Months Ended June 30,
2022202120222021
United States$10 $7 $20 $14 
United Kingdom3 4 7 7 
Other international1 1 2 4 
Total$14 $11 $28 $25 
  
Premiums Receivable for Financial Guarantees
Below is the gross premium receivable roll-forward (direct contracts), net of the allowance for credit losses, for the affected periods:
Six Months Ended June 30,20222021
Beginning premium receivable$320 $370 
Premium receipts(22)(19)
Adjustments for changes in expected and contractual cash flows for contracts (1)
(5)(17)
Accretion of premium receivable discount for contracts4 4 
Changes to allowance for credit losses3 6 
Other adjustments (including foreign exchange)(12)— 
Ending premium receivable (2)
$288 $344 
(1)    Adjustments for changes in expected and contractual cash flows are primarily due to indexation offset by 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 June 30, 2022 and 2021, premium receivables include British Pounds of $91 (£74) and $122 (£88), respectively, and Euros of $15 (€14) and $16 (€13), respectively.
  
Financial Guarantee Insurance Contracts, Premium Received over Contract Period
The following table summarizes the future gross undiscounted premiums to be collected and future premiums earned, net of reinsurance at June 30, 2022:
Future Premiums
to be
Collected (1)
Future
Premiums to
be Earned Net of
Reinsurance (2)
Three months ended:
September 30, 2022$8 $6 
December 31, 20226 6 
Twelve months ended:
December 31, 202329 23 
December 31, 202428 22 
December 31, 202527 21 
December 31, 202626 21 
Five years ended:
December 31, 2031111 85 
December 31, 203674 53 
December 31, 204134 21 
December 31, 204616 9 
December 31, 20515 3 
December 31, 2056— — 
Total$363 $270 
(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, 2021. 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.