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Fair Value (Tables)
 9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
Fair value hierarchy
The following table presents the Company’s financial assets and liabilities measured at fair value by level at September 30, 2019:
 
 
 
Estimated Fair Value Measurements Using:
 
Estimated
Fair
Value
 
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
Assets measured at fair value (1):
 

 
 

 
 

 
 

Available for sale securities:
 

 
 

 
 

 
 

Fixed maturities:
 

 
 

 
 

 
 

Corporate bonds
$
6,269,993

 
$
—

 
$
6,261,248

 
$
8,745

Mortgage backed securities
544,033

 
—

 
543,761

 
272

Municipal bonds
653,346

 
—

 
653,346

 
—

Commercial mortgage backed securities
754,306

 
—

 
754,306

 
—

U.S. government and government agencies
5,127,290

 
5,005,512

 
121,778

 
—

Non-U.S. government securities
1,873,856

 
—

 
1,873,856

 
—

Asset backed securities
1,657,494

 
—

 
1,652,045

 
5,449

Total
16,880,318

 
5,005,512

 
11,860,340

 
14,466

 
 
 
 
 
 
 
 
Short-term investments
751,989

 
720,518

 
31,471

 
—

 
 
 
 
 
 
 
 
Equity securities, at fair value
561,105

 
514,380

 
11,402

 
35,323

 
 
 
 
 
 
 
 
Derivative instruments (4)
51,647

 
—

 
51,647

 
—

 
 
 
 
 
 
 
 
Fair value option:
 
 
 
 
 
 
 
Corporate bonds
619,779

 
—

 
597,000

 
22,779

Non-U.S. government bonds
61,755

 
—

 
61,755

 
—

Mortgage backed securities
15,512

 
—

 
15,512

 
—

Municipal bonds
1,140

 
—

 
1,140

 
—

Asset backed securities
208,620

 
—

 
208,620

 
—

U.S. government and government agencies
1,996

 
1,886

 
110

 
—

Short-term investments
390,980

 
376,033

 
14,947

 
—

Equity securities
98,340

 
41,333

 
735

 
56,272

Other investments
1,411,420

 
41,316

 
1,284,661

 
85,443

Other investments measured at net asset value (2)
1,028,700

 
 
 
 
 
 
Total
3,838,242

 
460,568

 
2,184,480

 
164,494

 
 
 
 
 
 
 
 
Total assets measured at fair value
$
22,083,301

 
$
6,700,978

 
$
14,139,340

 
$
214,283

 
 
 
 
 
 
 
 
Liabilities measured at fair value:
 

 
 

 
 

 
 

Contingent consideration liabilities
$
(7,344
)
 
$
—

 
$
—

 
$
(7,344
)
Securities sold but not yet purchased (3)
(65,736
)
 
—

 
(65,736
)
 
—

Derivative instruments (4)
(53,740
)
 
—

 
(53,740
)
 
—

Total liabilities measured at fair value
$
(126,820
)
 
$
—

 
$
(119,476
)
 
$
(7,344
)

(1)
In securities lending transactions, the Company receives collateral in excess of the fair value of the securities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See note 6, “—Securities Lending Agreements.”
(2)
In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.
(3)
Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets.
(4)
See note 8.
The following table presents the Company’s financial assets and liabilities measured at fair value by level at December 31, 2018:
 
 
 
Estimated Fair Value Measurements Using:
 
Estimated
Fair
Value
 
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
 
Significant
Other
Observable
Inputs
(Level 2)
 
Significant
Unobservable
Inputs
(Level 3)
Assets measured at fair value (1):
 

 
 

 
 

 
 

Available for sale securities:
 

 
 

 
 

 
 

Fixed maturities:
 

 
 

 
 

 
 

Corporate bonds
$
5,537,548

 
$
—

 
$
5,529,407

 
$
8,141

Mortgage backed securities
541,193

 
—

 
540,884

 
309

Municipal bonds
1,013,395

 
—

 
1,013,395

 
—

Commercial mortgage backed securities
729,442

 
—

 
729,438

 
4

U.S. government and government agencies
3,758,698

 
3,657,181

 
101,517

 
—

Non-U.S. government securities
1,771,338

 
—

 
1,771,338

 
—

Asset backed securities
1,600,896

 
—

 
1,600,896

 
—

Total
14,952,510

 
3,657,181

 
11,286,875

 
8,454

 
 
 
 
 
 
 
 
Equity securities
353,794

 
321,927

 
31,867

 
—

 
 
 
 
 
 
 
 
Short-term investments
955,880

 
875,881

 
79,999

 
—

 
 
 
 
 
 
 
 
Derivative instruments (4)
73,893

 
—

 
73,893

 
—

 
 
 
 
 
 
 
 
Fair value option:
 
 
 
 
 
 
 
Corporate bonds
852,585

 
—

 
846,827

 
5,758

Non-U.S. government bonds
79,066

 
—

 
79,066

 
—

Mortgage backed securities
16,731

 
—

 
16,731

 
—

Municipal bonds
7,144

 
—

 
7,144

 
—

Asset backed securities
178,790

 
—

 
178,790

 
—

U.S. government and government agencies
111,246

 
111,138

 
108

 
—

Short-term investments
322,177

 
278,579

 
43,598

 
—

Equity securities
103,893

 
48,827

 
55,066

 
—

Other investments
1,254,220

 
39,107

 
1,152,408

 
62,705

Other investments measured at net asset value (2)
1,057,719

 
 
 
 
 
 
Total
3,983,571

 
477,651

 
2,379,738

 
68,463

 
 
 
 
 
 
 
 
Total assets measured at fair value
$
20,319,648

 
$
5,332,640

 
$
13,852,372

 
$
76,917

 
 
 
 
 
 
 
 
Liabilities measured at fair value:
 

 
 

 
 

 
 

Contingent consideration liabilities
$
(66,665
)
 
$
—

 
$
—

 
$
(66,665
)
Securities sold but not yet purchased (3)
(7,790
)
 
—

 
(7,790
)
 
—

Derivative instruments (4)
(20,664
)
 
—

 
(20,664
)
 
—

Total liabilities measured at fair value
$
(95,119
)
 
$
—

 
$
(28,454
)
 
$
(66,665
)

(1)
In securities lending transactions, the Company receives collateral in excess of the fair value of the securities pledged. For purposes of this table, the Company has excluded the collateral received under securities lending, at fair value and included the securities pledged under securities lending, at fair value. See note 6, “—Securities Lending Agreements.”
(2)
In accordance with applicable accounting guidance, certain investments that are measured at fair value using the net asset value per share (or its equivalent) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheets.
(3)
Represents the Company’s obligations to deliver securities that it did not own at the time of sale. Such amounts are included in “other liabilities” on the Company’s consolidated balance sheets.
(4)
See note 8.
Rollforward of Level 3 investments
The following table presents a reconciliation of the beginning and ending balances for all financial assets and liabilities measured at fair value on a recurring basis using Level 3 inputs:
 
Assets
Liabilities
s
Available For Sale
 
Fair Value Option
 
Fair Value
 
 
 
Structured Securities (1)
 
Corporate
Bonds
 
Corporate
Bonds
 
Other
Investments
 
Equity
Securities
 
Equity
Securities
 
Contingent Consideration Liabilities
Three Months Ended September 30, 2019
 
 
 

 
 
 
 
 
 
 
 

 
 
Balance at beginning of period
$
290

 
$
7,642

 
$
26,103

 
$
95,273

 
$
56,145

 
$
51,212

 
$
(7,825
)
Total gains or (losses) (realized/unrealized)
 
 
 
 
 
 
 
 
 
 


 
 
Included in earnings (2)
—

 
—

 
(1,227
)
 
(411
)
 
127

 
(26
)
 
(79
)
Included in other comprehensive income
—

 
(301
)
 
—

 
—

 
—

 
—

 
—

Purchases, issuances, sales and settlements
 
 
 
 
 
 
 
 
 
 


 
 
Purchases
—

 
—

 
—

 
3,713

 
—

 
12,119

 
—

Issuances
—

 
—

 
—

 
—

 
—

 
—

 
—

Sales
—

 
—

 
(2,097
)
 
(80
)
 
—

 
(27,982
)
 
—

Settlements
(18
)
 
(456
)
 
—

 
—

 
—

 
—

 
560

Transfers in and/or out of Level 3
5,449

 
1,860

 
—

 
(13,052
)
 
—

 
—

 
—

Balance at end of period
$
5,721

 
$
8,745

 
$
22,779

 
$
85,443

 
$
56,272

 
$
35,323

 
$
(7,344
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended September 30, 2018
 
 
 

 
 
 
 
 
 
 
 

 
 
Balance at beginning of period
$
376

 
$
8,773

 
$
11,335

 
$
58,214

 
$
—

 
$
—

 
$
(63,930
)
Total gains or (losses) (realized/unrealized)
 
 
 
 
 
 
 
 
 
 


 
 
Included in earnings (2)
—

 
(1
)
 
(503
)
 
(1,459
)
 
—

 
—

 
(1,711
)
Included in other comprehensive income
2

 
(32
)
 
—

 
—

 
—

 
—

 
—

Purchases, issuances, sales and settlements
 
 
 
 
 
 
 
 
 
 


 
 
Purchases
—

 
—

 
—

 
6,250

 
—

 
—

 
—

Issuances
—

 
—

 
—

 
—

 
—

 
—

 
—

Sales
—

 
—

 
—

 
(74
)
 
—

 
—

 
—

Settlements
(33
)
 
(456
)
 
(1,226
)
 
—

 
—

 
—

 
—

Transfers in and/or out of Level 3
—

 
—

 
—

 
—

 
—

 
—

 
—

Balance at end of period
$
345

 
$
8,284

 
$
9,606

 
$
62,931

 
$
—

 
$
—

 
$
(65,641
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2019
 
 
 

 
 
 
 
 
 
 
 

 
 
Balance at beginning of year
$
313

 
$
8,141

 
$
5,758

 
$
62,705

 
$
—

 
$
—

 
$
(66,665
)
Total gains or (losses) (realized/unrealized)
 
 
 
 
 
 
 
 
 
 


 
 
Included in earnings (2)
1,757

 
—

 
(1,566
)
 
(11,727
)
 
127

 
(26
)
 
(1,410
)
Included in other comprehensive income
5

 
(317
)
 
—

 
—

 
—

 
—

 
—

Purchases, issuances, sales and settlements
 
 
 
 
 
 
 
 
 
 


 
 
Purchases
—

 
429

 
—

 
3,713

 
—

 
12,119

 
—

Issuances
—

 
—

 
—

 
—

 
—

 
—

 
(548
)
Sales
(1,757
)
 
—

 
(5,332
)
 
(228
)
 
—

 
(27,982
)
 
—

Settlements
(46
)
 
(1,368
)
 
—

 
(600
)
 
—

 
—

 
61,279

Transfers in and/or out of Level 3
5,449

 
1,860

 
23,919

 
31,580

 
56,145

 
51,212

 
—

Balance at end of period
$
5,721

 
$
8,745

 
$
22,779

 
$
85,443

 
$
56,272

 
$
35,323

 
$
(7,344
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Nine Months Ended September 30, 2018
 
 
 

 
 
 
 
 
 
 
 

 
 
Balance at beginning of year
$
5,927

 
$
9,460

 
$
12,217

 
$
59,167

 
$
—

 
$
—

 
$
(60,996
)
Total gains or (losses) (realized/unrealized)
 
 
 
 
 
 
 
 
 
 


 
 
Included in earnings (2)
4

 
(1
)
 
(1,115
)
 
(1,838
)
 
—

 
—

 
(4,645
)
Included in other comprehensive income
(6
)
 
(200
)
 
—

 
—

 
—

 
—

 
—

Purchases, issuances, sales and settlements
 
 
 
 
 
 
 
 
 
 


 
 
Purchases
—

 
393

 
—

 
6,250

 
—

 
—

 
—

Issuances
—

 
—

 
—

 
—

 
—

 
—

 
—

Sales
(5,003
)
 
—

 
—

 
(148
)
 
—

 
—

 
—

Settlements
(577
)
 
(1,368
)
 
(1,496
)
 
(500
)
 
—

 
—

 
—

Transfers in and/or out of Level 3
—

 
—

 
—

 
—

 
—

 
—

 
—

Balance at end of period
$
345

 
$
8,284

 
$
9,606

 
$
62,931

 
$
—

 
$
—

 
$
(65,641
)

(1)
Includes asset backed securities, mortgage backed securities and commercial mortgage backed securities.
(2)
Gains or losses were included in net realized gains (losses).