Investments

Fixed Maturity and Equity Securities Available-for-Sale

The following tables provide information relating to investments in fixed maturity and equity securities by sector as of March 31, 2016 and December 31, 2015 (dollars in thousands):



March 31, 2016:	Amortized		Unrealized		Unrealized		Estimated Fair		% of		Other-than- temporary impairments
	Cost		Gains		Losses		Value		Total		in AOCI
Available-for-sale:
Corporate securities	$	17,926,454	$	872,226	$	286,632	$	18,512,048	59.5	%	$	—
Canadian and Canadian provincial governments	2,611,654		1,269,576		113		3,881,117		12.5		—
Residential mortgage-backed securities	1,330,894		61,124		11,121		1,380,897		4.4		(300		)
Asset-backed securities	1,319,616		10,462		40,697		1,289,381		4.1		354
Commercial mortgage-backed securities	1,466,500		47,907		6,224		1,508,183		4.8		(1,609		)
U.S. government and agencies	1,469,170		40,859		2,949		1,507,080		4.8		—
State and political subdivisions	506,521		53,761		8,039		552,243		1.8		—
Other foreign government, supranational and foreign government-sponsored enterprises	2,404,465		134,991		21,691		2,517,765		8.1		—
Total fixed maturity securities	$	29,035,274	$	2,490,906	$	377,466	$	31,148,714	100.0	%	$	(1,555	)
Non-redeemable preferred stock	$	83,427	$	2,768	$	8,110	$	78,085	66.2	%
Other equity securities	40,595		150		954		39,791		33.8
Total equity securities	$	124,022	$	2,918	$	9,064	$	117,876	100.0	%



December 31, 2015:	Amortized		Unrealized		Unrealized		Estimated Fair		% of		Other-than- temporary impairments
	Cost		Gains		Losses		Value		Total		in AOCI
Available-for-sale:
Corporate securities	$	17,575,507	$	599,718	$	467,069	$	17,708,156	59.7	%	$	—
Canadian and Canadian provincial governments	2,469,009		1,110,282		2,532		3,576,759		12.1		—
Residential mortgage-backed securities	1,277,998		45,152		11,673		1,311,477		4.4		(300		)
Asset-backed securities	1,219,000		12,052		18,376		1,212,676		4.1		354
Commercial mortgage-backed securities	1,456,848		37,407		11,168		1,483,087		5.0		(1,609		)
U.S. government and agencies	1,423,791		15,586		57,718		1,381,659		4.7		—
State and political subdivisions	480,067		40,014		9,067		511,014		1.7		—
Other foreign government, supranational and foreign government-sponsored enterprises	2,420,757		78,964		41,644		2,458,077		8.3		—
Total fixed maturity securities	$	28,322,977	$	1,939,175	$	619,247	$	29,642,905	100.0	%	$	(1,555	)
Non-redeemable preferred stock	$	85,645	$	7,837	$	5,962	$	87,520	69.5	%
Other equity securities	40,584		—		2,242		38,342		30.5
Total equity securities	$	126,229	$	7,837	$	8,204	$	125,862	100.0	%

The Company enters into various collateral arrangements with counterparties that require both the pledging and acceptance of fixed maturity securities as collateral. Pledged fixed maturity securities are included in fixed maturity securities, available-for-sale in the condensed consolidated balance sheets. Fixed maturity securities received as collateral are held in separate custodial accounts and are not recorded on the Company’s condensed consolidated balance sheets. Subject to certain constraints, the Company is permitted by contract to sell or repledge collateral it receives; however, as of March 31, 2016 and December 31, 2015, none of the collateral received had been sold or repledged. The Company also holds securities in trust to satisfy collateral requirements under certain third-party reinsurance treaties. The following table includes fixed maturity securities pledged and received as collateral and assets in trust held to satisfy collateral requirements under certain third-party reinsurance treaties as of March 31, 2016 and December 31, 2015 (dollars in thousands):



	March 31, 2016				December 31, 2015
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Fixed maturity securities pledged as collateral	$	192,718	$	204,980	$	169,678	$	176,782
Fixed maturity securities received as collateral	n/a		261,601		n/a		242,914
Securities held in trust	10,698,579		11,345,193		10,535,729		10,928,393

The Company monitors its concentrations of financial instruments on an ongoing basis and mitigates credit risk by maintaining a diversified investment portfolio which limits exposure to any one issuer. The Company’s exposure to concentrations of credit risk from single issuers greater than 10% of the Company’s stockholders’ equity included securities of the U.S. government and its agencies as well as the securities disclosed below as of March 31, 2016 and December 31, 2015 (dollars in thousands).



	March 31, 2016				December 31, 2015
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Fixed maturity securities guaranteed or issued by:
Canadian province of Ontario	$	892,870	$	1,257,794	$	864,444	$	1,199,080
Canadian province of Quebec	1,013,019		1,702,423		943,484		1,525,903

The amortized cost and estimated fair value of fixed maturity securities classified as available-for-sale at March 31, 2016 are shown by contractual maturity in the table below (dollars in thousands). Actual maturities can differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Asset and mortgage-backed securities are shown separately in the table below, as they are not due at a single maturity date.



	Amortized Cost		Estimated Fair Value
Available-for-sale:
Due in one year or less	$	802,218	$	809,704
Due after one year through five years	5,606,886		5,828,982
Due after five years through ten years	8,633,420		8,985,775
Due after ten years	9,875,740		11,345,792
Asset and mortgage-backed securities	4,117,010		4,178,461
Total	$	29,035,274	$	31,148,714

Corporate Fixed Maturity Securities

The tables below show the major industry types of the Company’s corporate fixed maturity holdings as of March 31, 2016 and December 31, 2015 (dollars in thousands):



March 31, 2016:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	5,818,427	$	6,026,229	32.6	%
Industrial	10,147,913		10,396,101		56.1
Utility	1,960,114		2,089,718		11.3
Total	$	17,926,454	$	18,512,048	100.0	%

December 31, 2015:			Estimated
	Amortized Cost		Fair Value		% of Total
Finance	$	5,408,791	$	5,555,044	31.4	%
Industrial	10,211,426		10,129,917		57.2
Utility	1,955,290		2,023,195		11.4
Total	$	17,575,507	$	17,708,156	100.0	%

Other-Than-Temporary Impairments - Fixed Maturity and Equity Securities

As discussed in Note 2 – “Summary of Significant Accounting Policies” of the 2015 Annual Report, a portion of certain other-than-temporary impairment (“OTTI”) losses on fixed maturity securities is recognized in AOCI. For these securities, the net amount recognized in the condensed consolidated statements of income (“credit loss impairments”) represents the difference between the amortized cost of the security and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the debt security prior to impairment. Any remaining difference between the fair value and amortized cost is recognized in AOCI. The amount of pre-tax credit loss impairments on fixed maturity securities held by the Company, for which a portion of the OTTI loss was recognized in AOCI, was $7.3 million as of March 31, 2016 and 2015. There were no changes in these amounts from their respective prior-year ending balances.

Unrealized Losses for Fixed Maturity and Equity Securities Available-for-Sale

The following table presents the total gross unrealized losses for the 1,450 and 2,080 fixed maturity and equity securities as of March 31, 2016 and December 31, 2015, respectively, where the estimated fair value had declined and remained below amortized cost by the indicated amount (dollars in thousands):



	March 31, 2016				December 31, 2015
	Gross Unrealized Losses		% of Total		Gross Unrealized Losses		% of Total
Less than 20%	$	275,128	71.2	%	$	463,109	73.8	%
20% or more for less than six months	69,739		18.0		142,495		22.7
20% or more for six months or greater	41,663		10.8		21,847		3.5
Total	$	386,530	100.0	%	$	627,451	100.0	%

The Company’s determination of whether a decline in value is other-than-temporary includes analysis of the underlying credit and the extent and duration of a decline in value. The Company’s credit analysis of an investment includes determining whether the issuer is current on its contractual payments, evaluating whether it is probable that the Company will be able to collect all amounts due according to the contractual terms of the security and analyzing the overall ability of the Company to recover the amortized cost of the investment. In the Company’s impairment review process, the duration and severity of an unrealized loss position for equity securities are given greater weight and consideration given the lack of contractual cash flows or deferability features.

The following tables present the estimated fair values and gross unrealized losses, including other-than-temporary impairment losses reported in AOCI, for 1,450 and 2,080 fixed maturity and equity securities that have estimated fair values below amortized cost as of March 31, 2016 and December 31, 2015, respectively (dollars in thousands). These investments are presented by class and grade of security, as well as the length of time the related fair value has remained below amortized cost.



	Less than 12 months				12 months or greater				Total
			Gross				Gross				Gross
March 31, 2016:	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
Corporate securities	$	2,082,050	$	79,986	$	1,557,209	$	112,210	$	3,639,259	$	192,196
Canadian and Canadian provincial governments	49,560		113		—		—		49,560		113
Residential mortgage-backed securities	217,618		5,773		104,341		4,456		321,959		10,229
Asset-backed securities	629,257		25,390		237,331		12,243		866,588		37,633
Commercial mortgage-backed securities	256,118		3,936		52,341		1,995		308,459		5,931
U.S. government and agencies	129,048		801		70,288		2,148		199,336		2,949
State and political subdivisions	14,632		510		55,295		7,529		69,927		8,039
Other foreign government, supranational and foreign government-sponsored enterprises	107,785		3,274		115,085		5,922		222,870		9,196
Total investment grade securities	3,486,068		119,783		2,191,890		146,503		5,677,958		266,286
Below investment grade securities:
Corporate securities	573,014		65,766		137,674		28,670		710,688		94,436
Residential mortgage-backed securities	22,774		411		10,445		481		33,219		892
Asset-backed securities	6,506		1,368		8,818		1,696		15,324		3,064
Commercial mortgage-backed securities	—		—		3,207		293		3,207		293
Other foreign government, supranational and foreign government-sponsored enterprises	36,134		2,482		58,897		10,013		95,031		12,495
Total below investment grade securities	638,428		70,027		219,041		41,153		857,469		111,180
Total fixed maturity securities	$	4,124,496	$	189,810	$	2,410,931	$	187,656	$	6,535,427	$	377,466
Non-redeemable preferred stock	$	15,334	$	356	$	22,821	$	7,754	$	38,155	$	8,110
Other equity securities	13,263		702		11,649		252		24,912		954
Total equity securities	$	28,597	$	1,058	$	34,470	$	8,006	$	63,067	$	9,064



	Less than 12 months				12 months or greater				Total
			Gross				Gross				Gross
December 31, 2015:	Estimated		Unrealized		Estimated		Unrealized		Estimated		Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
Investment grade securities:
Corporate securities	$	6,388,148	$	323,961	$	294,755	$	40,861	$	6,682,903	$	364,822
Canadian and Canadian provincial governments	122,746		2,532		—		—		122,746		2,532
Residential mortgage-backed securities	452,297		7,036		82,314		4,057		534,611		11,093
Asset-backed securities	581,701		9,825		199,298		7,100		780,999		16,925
Commercial mortgage-backed securities	514,877		9,806		31,177		997		546,054		10,803
U.S. government and agencies	1,010,387		57,718		—		—		1,010,387		57,718
State and political subdivisions	157,837		5,349		13,016		3,718		170,853		9,067
Other foreign government, supranational and foreign government-sponsored enterprises	702,962		18,279		38,379		4,206		741,341		22,485
Total investment grade securities	9,930,955		434,506		658,939		60,939		10,589,894		495,445
Below investment grade securities:
Corporate securities	554,688		71,171		114,427		31,076		669,115		102,247
Residential mortgage-backed securities	22,646		282		7,679		298		30,325		580
Asset-backed securities	6,772		201		9,335		1,250		16,107		1,451
Commercial mortgage-backed securities	3,253		248		767		117		4,020		365
Other foreign government, supranational and foreign government-sponsored enterprises	60,668		7,356		31,693		11,803		92,361		19,159
Total below investment grade securities	648,027		79,258		163,901		44,544		811,928		123,802
Total fixed maturity securities	$	10,578,982	$	513,764	$	822,840	$	105,483	$	11,401,822	$	619,247
Non-redeemable preferred stock	$	12,331	$	2,175	$	12,191	$	3,787	$	24,522	$	5,962
Other equity securities	38,327		2,242		—		—		38,327		2,242
Total equity securities	$	50,658	$	4,417	$	12,191	$	3,787	$	62,849	$	8,204

The Company has no intention to sell, nor does it expect to be required to sell, the securities outlined in the table above, as of the dates indicated. However, unforeseen facts and circumstances may cause the Company to sell fixed maturity and equity securities in the ordinary course of managing its portfolio to meet certain diversification, credit quality and liquidity guidelines.

Unrealized losses on below investment grade securities as of March 31, 2016 are primarily related to high-yield corporate and other foreign government, supranational and foreign government-sponsored enterprise securities. Unrealized losses decreased across most security types as treasury rates decreased during the first three months of 2016.

Investment Income, Net of Related Expenses

Major categories of investment income, net of related expenses, consist of the following (dollars in thousands):



	Three months ended March 31,
	2016			2015
Fixed maturity securities available-for-sale	$	312,414		$	269,768
Mortgage loans on real estate	39,792			34,772
Policy loans	16,134			14,040
Funds withheld at interest	55,980			112,260
Short-term investments	975			695
Other invested assets	9,824			12,027
Investment income	435,119			443,562
Investment expense	(17,853		)	(16,671		)
Investment income, net of related expenses	$	417,266		$	426,891

Investment Related Gains (Losses), Net

Investment related gains (losses), net consist of the following (dollars in thousands):



	Three months ended March 31,
	2016			2015
Fixed maturity and equity securities available for sale:
Other-than-temporary impairment losses on fixed maturity securities recognized in earnings	$	(33,817	)	$	(2,527	)
Gain on investment activity	27,192			19,201
Loss on investment activity	(11,787		)	(13,596		)
Other impairment losses and change in mortgage loan provision	(2,060		)	(4,168		)
Derivatives and other, net	(100,414		)	8,673
Total investment related gains (losses), net	$	(120,886	)	$	7,583

The fixed maturity impairments for the three months ended March 31, 2016 and 2015 were largely related to high-yield energy and emerging market corporate securities. The fluctuations in investment related gains (losses) for derivatives and other for the three months ended March 31, 2016, compared to the same period in 2015, are primarily due to changes in the fair value of embedded derivatives related to modified coinsurance and funds withheld treaties.

During the three months ended March 31, 2016 and 2015, the Company sold fixed maturity and equity securities with fair values of $242.6 million and $199.6 million at losses of $11.8 million and $13.6 million, respectively. The Company generally does not buy and sell securities on a short-term basis.

Securities Borrowing and Other

The Company participates in securities borrowing programs whereby securities, which are not reflected on the Company’s condensed consolidated balance sheets, are borrowed from third parties. The borrowed securities are used to provide collateral under affiliated reinsurance transactions. The Company is required to maintain a minimum of 100% of the fair value, or par value, under certain programs, of the borrowed securities as collateral. The collateral consists of rights to reinsurance treaty cash flows. If cash flows from the reinsurance treaties are insufficient to maintain the minimum collateral requirement, the Company may substitute cash or securities to meet the requirement. No cash or securities have been pledged by the Company for this purpose.

The Company also participates in a repurchase/reverse repurchase program in which securities, reflected as investments on the Company’s condensed consolidated balance sheets, are pledged to a third party. In return, the Company receives securities from the third party with an estimated fair value equal to a minimum of 100% of the securities pledged. The securities received are not reflected on the Company’s condensed consolidated balance sheets.

The following table includes the amount of borrowed securities, repurchased securities pledged and repurchased/reverse repurchased securities pledged and received as of March 31, 2016 and December 31, 2015 (dollars in thousands).



	March 31, 2016				December 31, 2015
	Amortized Cost		Estimated Fair Value		Amortized Cost		Estimated Fair Value
Borrowed securities	$	268,800	$	282,780	$	259,540	$	266,297
Repurchase program/reverse repurchase program:
Securities pledged	454,264		479,427		443,435		465,889
Securities received	n/a		479,482		n/a		481,197

The following table presents information on the securities pledged as collateral by the Company related to its repurchase/reverse repurchase program as of March 31, 2016 and December 31, 2015 (dollars in thousands). Collateral associated with certain borrowed securities is not included within the table, as the collateral pledged to each counterparty is the right to reinsurance treaty cash flows.



	March 31, 2016
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater than 90 Days		Total
Collateral on repurchase program
Corporate securities	$	—	$	—	$	1,445	$	157,995	$	159,440
Residential mortgage-backed securities	—		—		—		97,398		97,398
U.S. government and agencies	—		—		—		212,081		212,081
Foreign government	—		—		—		3,303		3,303
Other	7,205		—		—		—		7,205
Total borrowings	$	7,205	$	—	$	1,445	$	470,777	$	479,427

Gross amount of recognized liabilities for repurchase agreement in preceding table									$	479,482
Amounts related to agreements not included in offsetting disclosure									$	55



	December 31, 2015
	Remaining Contractual Maturity of the Agreements
	Overnight and Continuous		Up to 30 Days		30-90 Days		Greater than 90 Days		Total
Collateral on repurchase program
Corporate securities	$	—	$	2,951	$	—	$	147,324	$	150,275
Residential mortgage-backed securities	—		—		—		97,639		97,639
U.S. government and agencies	—		—		—		199,431		199,431
Foreign government	—		—		—		3,358		3,358
Other	15,186		—		—		—		15,186
Total borrowings	$	15,186	$	2,951	$	—	$	447,752	$	465,889

Gross amount of recognized liabilities for repurchase agreement in preceding table									$	481,197
Amounts related to agreements not included in offsetting disclosure									$	15,308

Mortgage Loans on Real Estate

Mortgage loans represented approximately 7.6% and 7.5% of the Company’s total investments as of March 31, 2016 and December 31, 2015. The Company makes mortgage loans on income producing properties that are geographically diversified, with the largest concentration being in the state of California, which represented 22.2% and 22.3% of mortgage loans on real estate as of March 31, 2016 and December 31, 2015, respectively. Loan-to-value ratios at the time of loan approval are 75% or less. The distribution of mortgage loans by property type, gross of valuation allowances, is as follows as of March 31, 2016 and December 31, 2015 (dollars in thousands):



	March 31, 2016				December 31, 2015
Property type:	Recorded Investment		% of Total		Recorded Investment		% of Total
Office building	$	1,044,806	31.7	%	$	980,858	31.3	%
Retail	1,011,124		30.6		1,026,018		32.7
Industrial	656,171		19.9		527,485		16.8
Apartment	399,653		12.1		420,014		13.4
Other commercial	187,566		5.7		182,389		5.8
Total	$	3,299,320	100.0	%	$	3,136,764	100.0	%

The maturities of the mortgage loans, gross of valuation allowances, as of March 31, 2016 and December 31, 2015 are as follows (dollars in thousands):



	March 31, 2016				December 31, 2015
	Recorded Investment		% of Total		Recorded Investment		% of Total
Due within five years	$	844,192	25.6	%	$	873,280	27.8	%
Due after five years through ten years	1,709,137		51.8		1,561,535		49.8
Due after ten years	745,991		22.6		701,949		22.4
Total	$	3,299,320	100.0	%	$	3,136,764	100.0	%

Information regarding the Company’s credit quality indicators, as determined by the Company's internal evaluation methodology for its recorded investment in mortgage loans, gross of valuation allowances, as of March 31, 2016 and December 31, 2015 is as follows (dollars in thousands):



	March 31, 2016				December 31, 2015
Internal credit quality grade:	Recorded Investment		% of Total		Recorded Investment		% of Total
High investment grade	$	1,739,464	52.8	%	$	1,621,601	51.7	%
Investment grade	1,449,516		43.9		1,397,996		44.6
Average	86,600		2.6		87,196		2.8
Watch list	13,483		0.4		13,550		0.4
In or near default	10,257		0.3		16,421		0.5
Total	$	3,299,320	100.0	%	$	3,136,764	100.0	%

The age analysis of the Company’s past due recorded investment in mortgage loans, gross of valuation allowances, as of March 31, 2016 and December 31, 2015 is as follows (dollars in thousands):



	March 31, 2016		December 31, 2015
31-60 days past due	$	1,891	$	—
61-90 days past due	—		—
Greater than 90 days	—		—
Total past due	1,891		—
Current	3,297,429		3,136,764
Total	$	3,299,320	$	3,136,764

The following table presents the recorded investment in mortgage loans, by method of measuring impairment, and the related valuation allowances as of March 31, 2016 and December 31, 2015 (dollars in thousands):



	March 31, 2016		December 31, 2015
Mortgage loans:
Individually measured for impairment	$	10,257	$	16,421
Collectively measured for impairment	3,289,063		3,120,343
Mortgage loans, gross of valuation allowances	3,299,320		3,136,764
Valuation allowances:
Individually measured for impairment	594		588
Collectively measured for impairment	6,230		6,225
Total valuation allowances	6,824		6,813
Mortgage loans, net of valuation allowances	$	3,292,496	$	3,129,951

Information regarding the Company’s loan valuation allowances for mortgage loans for the three months ended March 31, 2016 and 2015 is as follows (dollars in thousands):



	Three months ended March 31,
	2016		2015
Balance, beginning of period	$	6,813	$	6,471
Charge-offs, net of recoveries	—		—
Provision (release)	11		(341		)
Balance, end of period	$	6,824	$	6,130

Information regarding the portion of the Company’s mortgage loans that were impaired as of March 31, 2016 and December 31, 2015 is as follows (dollars in thousands):



	Unpaid Principal Balance		Recorded Investment		Related Allowance		Carrying Value
March 31, 2016:
Impaired mortgage loans with no valuation allowance recorded	$	818	$	809	$	—	$	809
Impaired mortgage loans with valuation allowance recorded	9,950		9,448		594		8,854
Total impaired mortgage loans	$	10,768	$	10,257	$	594	$	9,663
December 31, 2015:
Impaired mortgage loans with no valuation allowance recorded	$	4,033	$	4,033	$	—	$	4,033
Impaired mortgage loans with valuation allowance recorded	12,898		12,388		588		11,800
Total impaired mortgage loans	$	16,931	$	16,421	$	588	$	15,833

The Company’s average investment in impaired mortgage loans and the related interest income are reflected in the table below for the periods indicated (dollars in thousands):
	Three months ended March 31,
	2016				2015
	Average Recorded Investment⁽¹⁾		Interest Income		Average Recorded Investment⁽¹⁾		Interest Income
Impaired mortgage loans with no valuation allowance recorded	$	2,421	$	12	$	10,290	$	106
Impaired mortgage loans with valuation allowance recorded	10,918		144		6,702		155
Total impaired mortgage loans	$	13,339	$	156	$	16,992	$	261

(1) Average recorded investment represents the average loan balances as of the beginning of period and all subsequent quarterly end of period balances.

The Company did not acquire any impaired mortgage loans during the three months ended March 31, 2016 and 2015. The Company had no mortgage loans that were on a nonaccrual status at March 31, 2016 and December 31, 2015.

Policy Loans

Policy loans comprised approximately 3.3% and 3.5% of the Company’s total investments as of March 31, 2016 and December 31, 2015, respectively, the majority of which are associated with one client. These policy loans present no credit risk because the amount of the loan cannot exceed the obligation due to the ceding company upon the death of the insured or surrender of the underlying policy. The provisions of the treaties in force and the underlying policies determine the policy loan interest rates. The Company earns a spread between the interest rate earned on policy loans and the interest rate credited to corresponding liabilities.

Funds Withheld at Interest

Funds withheld at interest comprised approximately 13.3% and 14.0% of the Company’s total investments as of March 31, 2016 and December 31, 2015, respectively. Of the $5.8 billion funds withheld at interest balance, net of embedded derivatives, as of March 31, 2016, $3.9 billion of the balance is associated with one client. For reinsurance agreements written on a modified coinsurance basis and certain agreements written on a coinsurance funds withheld basis, assets equal to the net statutory reserves are withheld and legally owned and managed by the ceding company and are reflected as funds withheld at interest on the Company’s condensed consolidated balance sheets. In the event of a ceding company’s insolvency, the Company would need to assert a claim on the assets supporting its reserve liabilities. However, the risk of loss to the Company is mitigated by its ability to offset amounts it owes the ceding company for claims or allowances against amounts owed to the Company from the ceding company.

Other Invested Assets

Other invested assets include equity securities, limited partnership interests, joint ventures (other than operating joint ventures), structured loans, derivative contracts, fair value option ("FVO") contractholder-directed unit-linked investments, Federal Home Loan Bank of Des Moines ("FHLB") common stock (included in other in the table below), real estate held-for-investment (included in other in the table below), and equity release mortgages (included in other in the table below). The fair value option was elected for contractholder-directed investments supporting unit-linked variable annuity type liabilities which do not qualify for presentation and reporting as separate accounts. Other invested assets represented approximately 3.1% of the Company’s total investments as of March 31, 2016 and December 31, 2015. Carrying values of these assets as of March 31, 2016 and December 31, 2015 are as follows (dollars in thousands):



	March 31, 2016		December 31, 2015
Equity securities	$	117,876	$	125,862
Limited partnerships and real estate joint ventures	602,117		567,697
Structured loans	35,751		45,422
Derivatives	282,954		256,178
FVO contractholder-directed unit-linked investments	202,130		197,547
Other	127,716		105,414
Total other invested assets	$	1,368,544	$	1,298,120