Postretirement Benefits (Tables)

12 Months Ended

Dec. 31, 2017

Retirement Benefits [Abstract]

Schedule of cost of pension plans

Cost of pension plans

Pension plan cost includes the following components:

(in thousands)
	2017			2016			2015
Service cost for benefits earned	$	31,106		$	28,201		$	30,433
Interest cost on benefit obligation	34,275			33,125			30,755
Expected return on plan assets	(41,267		)	(39,520		)	(35,921		)
Prior service cost amortization	871			696			670
Net actuarial loss amortization	9,301			8,111			14,031
Settlement cost (1)	302			—			—
Pension plan cost (2)	$	34,588		$	30,613		$	39,968

(1) The final SERP benefit for two former executives was settled with lump sum payments in 2017.

(2) Pension plan costs represent the total cost before reimbursements to Indemnity from the Exchange and its subsidiaries.

Schedule of actuarial assumptions used to measure the year-end obligations and net periodic benefit costs for the subsequent year

Actuarial assumptions

The following table describes the assumptions at December 31 used to measure the year-end obligations and the net periodic benefit costs for the subsequent year:

	2017		2016		2015		2014
Employee pension plan:
Discount rate	3.73	%	4.24	%	4.57	%	4.17	%
Expected return on assets	6.75		7.00		7.00		7.00
Compensation increases (1)	3.32		3.32		3.32		3.32
SERP:
Discount rate – pre-retirement/post-retirement	3.73/3.23		4.24/3.74		4.57/4.07		4.17/3.67
Rate of compensation increase	5.00		5.00		5.00		5.00

(1) The rate of compensation increase for the employee plan is age-graded.  An equivalent single compensation increase rate of 3.32% in 2017, 2016 and 2015 would produce similar results.

Schedule of funded status of pension plans and amounts recognized in the Statements of Financial Position

The following table sets forth the funded status of the pension plans and the amounts recognized in the Statements of Financial Position at December 31:

(in thousands)
	2017			2016
Funded status at end of year	$	(207,766	)	$	(224,115	)
Pension liabilities – due within one year (1)	$	(236	)	$	(2,288	)
Pension liabilities – due after one year	(207,530		)	(221,827		)
Net amount recognized	$	(207,766	)	$	(224,115	)

(1)    The current portion of pension liabilities is included in accounts payable and accrued liabilities in the Statements of Financial Position.

Schedule of reconciliation of beginning and ending balances of the projected benefit obligation, as well as the accumulated benefit obligation

The following table sets forth a reconciliation of beginning and ending balances of the projected benefit obligation, as well as the accumulated benefit obligation at December 31:

(in thousands)
	2017			2016
Projected benefit obligation, beginning of year	$	816,659		$	724,580
Service cost for benefits earned	31,106			28,201
Interest cost on benefit obligation	34,275			33,125
Plan amendments	5,050			2,114
Actuarial loss	82,940			43,032
Benefits paid	(16,184		)	(14,393		)
Settlement cost	(2,180		)	—
Projected benefit obligation, end of year	$	951,666		$	816,659
Accumulated benefit obligation, end of year	$	767,527		$	657,969

Schedule of defined benefit pension plans with assets less than accumulated benefit obligation

The following table describes plans with assets less than accumulated benefit obligation at December 31:

(in thousands)
	2017		2016
Projected benefit obligation	$	951,666	$	816,659
Accumulated benefit obligation	767,527		657,969
Plan assets	743,900		592,544

Schedule of reconciliation of beginning and ending balances of the fair value of plan assets

Pension assets

The following table sets forth a reconciliation of beginning and ending balances of the fair value of plan assets at December 31:

(in thousands)
	2017			2016
Fair value of plan assets, beginning of year	$	592,544		$	551,491
Actual gain on plan assets	108,618			38,028
Employer contributions	61,102			17,418
Benefits paid	(16,184		)	(14,393		)
Settlements (1)	(2,180		)	—
Fair value of plan assets, end of year	$	743,900		$	592,544

(1) The final SERP benefit for two former executives was settled with lump sum payments in 2017.

Schedule of amounts included in accumulated other comprehensive income that were not yet recognized as components of net benefit costs

Accumulated other comprehensive income

Net actuarial loss and prior service cost included in accumulated other comprehensive income that were not yet recognized as components of net benefit costs were as follows:

(in thousands)
	2017		2016
Net actuarial loss	$	191,264	$	185,278
Prior service cost	10,201		6,023
Net amount not yet recognized	$	201,465	$	191,301

Schedule of amounts recognized in other comprehensive income for pension plans

Other comprehensive income

Amounts recognized in other comprehensive income for pension plans were as follows:

(in thousands)
	2017			2016
Net actuarial loss arising during the year	$	15,588		$	44,524
Amortization of net actuarial loss	(9,301		)	(8,111		)
Amortization of prior service cost	(871		)	(696		)
Amendments (1)	5,050			2,114
Impact due to settlement (2)	(302		)	—
Total recognized in other comprehensive income	$	10,164		$	37,831

(1) Effective December 31, 2016, a plan amendment was adopted to enhance the surviving spouse's death benefits, which increased the pension plan obligation by $3.6 million and the SERP obligation by $0.3 million in 2017. In 2016, a plan amendment was adopted to allow part time employees to participant in the pension plan, which added prior service cost of $1.7 million in 2016. Additionally, there were two new SERP participants in 2017 and one new participant in 2016, which contributed $1.2 million and $0.4 million, respectively.

(2) The final SERP benefit for two former executives was settled with lump sum payments in 2017.

Schedule of target and actual asset allocations for the portfolio

The target and actual asset allocations for the portfolio are as follows for the years ended December 31:

	Target asset allocation			Target asset allocation		Actual asset allocation		Actual asset allocation
Asset allocation:	2017			2016		2017		2016
Equity securities:
U.S. equity securities	35	%	(1)	35	%	39	%	38	%
Non-U.S. equity securities	20		(2)	20		19		18
Total equity securities	55			55		58		56
Debt securities	44		(3)	44		41		43
Other	1		(4)	1		1		1
Total	100	%		100	%	100	%	100	%

(1) U.S. equity securities –22% seek to achieve excess returns relative to the Russell 2000 Index, while 30% seek to achieve excess returns relative to the S&P 500.  The remaining 48% of the allocation to U.S. equity securities are comprised of equity index funds that track the S&P 500.

(2) Non-U.S. equity securities –11% are allocated to international small cap investments, while another 11% are allocated to international emerging market investments.  The remaining 78% of the Non-U.S. equity securities are allocated to investments seeking to achieve excess returns relative to an international market index.

(3) Debt securities –44% are allocated to long U.S. Treasury Strips, 44% are allocated to U.S. corporate bonds with an emphasis on long duration bonds rated A or better, while the remaining 12% are allocated to floating rate high income leverage loans.

(4) Institutional money market fund.

Schedule of fair value measurements of pension plan assets by major category and level of input

The following tables represent the fair value measurements for the pension plan assets by major category and level of input:

	At December 31, 2017
	Fair value measurements of plan assets using:
(in thousands)	Total		Quoted prices in active markets for identical assets Level 1		Significant observable inputs Level 2		Significant unobservable inputs Level 3
Equity securities:
U.S. equity securities	$	288,861	$	0	$	288,861	$	0
Non-U.S. equity securities	145,238		0		145,238		0
Total equity securities	434,099		0		434,099		0
Debt securities	303,331		0		303,331		0
Other	6,470		6,470		0		0
Total	$	743,900	$	6,470	$	737,430	$	0

	At December 31, 2016
	Fair value measurements of plan assets using:
(in thousands)	Total		Quoted prices in active markets for identical assets Level 1		Significant observable inputs Level 2		Significant unobservable inputs Level 3
Equity securities:
U.S. equity securities	$	225,446	$	0	$	225,446	$	0
Non-U.S. equity securities	107,953		0		107,953		0
Total equity securities	333,399		0		333,399		0
Debt securities	253,197		0		253,197		0
Other	5,948		5,948		0		0
Total	$	592,544	$	5,948	$	586,596	$	0

Schedule of benefits expected to be paid over the next 10 years from pension plans

Estimated future benefit payments

The following table sets forth amounts of benefits expected to be paid over the next 10 years from our pension plans as of December 31:

(in thousands)
Year ending December 31,		Expected future benefit payments
2018	$	20,739
2019		23,050
2020		25,665
2021		28,687
2022		31,650
2023 - 2027		210,951