Investment Information (Tables)

3 Months Ended

Mar. 31, 2013

Disclosure Investment Information [Abstract]

Summary of fair value and cost or amortized cost of available for sale securities

The following table summarizes the fair value and cost or amortized cost of the Company’s investments classified as available for sale:

	Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Cost or Amortized Cost		OTTI Unrealized Losses (2)
March 31, 2013
Fixed maturities and fixed maturities pledged under securities lending agreements (1):
Corporate bonds	$	2,592,744	$	77,404	$	(6,854	)	$	2,522,194	$	(56	)
Mortgage backed securities	1,704,813		23,249		(9,395		)	1,690,959		(9,330		)
Municipal bonds	1,442,116		54,533		(1,732		)	1,389,315		(17		)
Commercial mortgage backed securities	867,856		27,757		(2,717		)	842,816		(231		)
U.S. government and government agencies	1,151,429		21,512		(463		)	1,130,380		(19		)
Non-U.S. government securities	1,074,797		24,745		(12,817		)	1,062,869		—
Asset backed securities	1,146,611		24,706		(9,760		)	1,131,665		(3,348		)
Total	9,980,366		253,906		(43,738		)	9,770,198		(13,001		)
Equity securities	342,091		51,325		(10,124		)	300,890		—
Other investments	585,277		36,425		(2,945		)	551,797		—
Short-term investments	944,274		2,962		(4,227		)	945,539		—
Total	$	11,852,008	$	344,618	$	(61,034	)	$	11,568,424	$	(13,001	)
December 31, 2012
Fixed maturities and fixed maturities pledged under securities lending agreements (1):
Corporate bonds	$	2,857,513	$	105,798	$	(6,710	)	$	2,758,425	$	(62	)
Mortgage backed securities	1,532,736		24,809		(7,484		)	1,515,411		(9,329		)
Municipal bonds	1,463,586		62,322		(1,421		)	1,402,685		(17		)
Commercial mortgage backed securities	824,165		37,514		(4,468		)	791,119		(270		)
U.S. government and government agencies	1,131,688		20,178		(1,095		)	1,112,605		(19		)
Non-U.S. government securities	998,901		33,701		(8,860		)	974,060		—
Asset backed securities	1,073,999		25,528		(5,838		)	1,054,309		(3,346		)
Total	9,882,588		309,850		(35,876		)	9,608,614		(13,043		)
Equity securities	312,749		26,625		(12,290		)	298,414		—
Other investments	549,280		32,582		(3,257		)	519,955		—
Short-term investments	730,369		3,521		(1,248		)	728,096		—
Total	$	11,474,986	$	372,578	$	(52,671	)	$	11,155,079	$	(13,043	)

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(1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities and short-term investments pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities and short-term investments pledged. See “—Securities Lending Agreements.”

(2) Represents the total other-than-temporary impairments (“OTTI”) recognized in accumulated other comprehensive income (“AOCI”). It does not include the change in fair value subsequent to the impairment measurement date. At March 31, 2013, the net unrealized gain related to securities for which a non-credit OTTI was recognized in AOCI was $5.1 million, compared to a net unrealized gain of $2.0 million at December 31, 2012.

Summary of available for sale securities in a continual unrealized loss position

The following table summarizes, for all available for sale securities in an unrealized loss position, the fair value and gross unrealized loss by length of time the security has been in a continual unrealized loss position:

	Less than 12 Months					12 Months or More					Total
	Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses			Fair Value		Gross Unrealized Losses
March 31, 2013
Fixed maturities and fixed maturities pledged under securities lending agreements (1):
Corporate bonds	$	533,561	$	(4,593	)	$	35,835	$	(2,261	)	$	569,396	$	(6,854	)
Mortgage backed securities	728,792		(8,613		)	24,055		(782		)	752,847		(9,395		)
Municipal bonds	188,494		(1,292		)	10,513		(440		)	199,007		(1,732		)
Commercial mortgage backed securities	216,698		(2,665		)	710		(52		)	217,408		(2,717		)
U.S. government and government agencies	44,237		(463		)	—		—			44,237		(463		)
Non-U.S. government securities	384,535		(7,178		)	76,346		(5,639		)	460,881		(12,817		)
Asset backed securities	190,944		(4,425		)	54,700		(5,335		)	245,644		(9,760		)
Total	2,287,261		(29,229		)	202,159		(14,509		)	2,489,420		(43,738		)
Equity securities	114,184		(8,210		)	20,725		(1,914		)	134,909		(10,124		)
Other investments	62,020		(2,043		)	33,759		(902		)	95,779		(2,945		)
Short-term investments	108,123		(4,227		)	—		—			108,123		(4,227		)
Total	$	2,571,588	$	(43,709	)	$	256,643	$	(17,325	)	$	2,828,231	$	(61,034	)
December 31, 2012
Fixed maturities and fixed maturities pledged under securities lending agreements (1):
Corporate bonds	$	490,784	$	(3,692	)	$	52,334	$	(3,018	)	$	543,118	$	(6,710	)
Mortgage backed securities	537,883		(4,290		)	60,574		(3,194		)	598,457		(7,484		)
Municipal bonds	147,766		(1,120		)	7,052		(301		)	154,818		(1,421		)
Commercial mortgage backed securities	36,649		(2,261		)	8,878		(2,207		)	45,527		(4,468		)
U.S. government and government agencies	146,526		(1,095		)	—		—			146,526		(1,095		)
Non-U.S. government securities	244,827		(1,070		)	135,564		(7,790		)	380,391		(8,860		)
Asset backed securities	234,584		(1,508		)	57,371		(4,330		)	291,955		(5,838		)
Total	1,839,019		(15,036		)	321,773		(20,840		)	2,160,792		(35,876		)
Equity securities	130,385		(10,200		)	16,469		(2,090		)	146,854		(12,290		)
Other investments	23,849		(2,474		)	35,083		(783		)	58,932		(3,257		)
Short-term investments	57,415		(1,248		)	—		—			57,415		(1,248		)
Total	$	2,050,668	$	(28,958	)	$	373,325	$	(23,713	)	$	2,423,993	$	(52,671	)

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(1) In securities lending transactions, the Company receives collateral in excess of the fair value of the fixed maturities and short-term investments pledged. For purposes of this table, the Company has excluded the collateral received and reinvested and included the fixed maturities and short-term investments pledged. See “—Securities Lending Agreements.”

Contractual maturities of the Company's fixed maturities and fixed maturities pledged under securities lending arrangements

	March 31, 2013				December 31, 2012
Maturity	Fair Value		Amortized Cost		Fair Value		Amortized Cost
Due in one year or less	$	414,808	$	405,063	$	446,402	$	436,376
Due after one year through five years	3,692,725		3,617,078		3,876,062		3,769,426
Due after five years through 10 years	1,852,459		1,789,372		1,949,297		1,869,698
Due after 10 years	301,094		293,245		179,927		172,275
	6,261,086		6,104,758		6,451,688		6,247,775
Mortgage backed securities	1,704,813		1,690,959		1,532,736		1,515,411
Commercial mortgage backed securities	867,856		842,816		824,165		791,119
Asset backed securities	1,146,611		1,131,665		1,073,999		1,054,309
Total	$	9,980,366	$	9,770,198	$	9,882,588	$	9,608,614

Summary of other investments, including available for sale and fair value option components

The following table summarizes the Company's other investments, including available for sale and fair value option components:

	March 31, 2013		December 31, 2012
Available for sale:
Asian and emerging markets	$	328,652	$	316,860
Investment grade fixed income	249,345		220,410
Other	7,280		12,010
Total available for sale	585,277		549,280
Fair value option:
Term loan investments (par value: $323,833 and $307,016)	328,254		308,596
Asian and emerging markets	30,796		24,035
Investment grade fixed income	81,583		67,624
Non-investment grade fixed income	11,107		11,093
Other	86,105		116,623
Total fair value option	$	537,845	$	527,971
Total	$	1,123,122	$	1,077,251

Summary of assets and liabilities accounted for using the fair value option

The following table summarizes the Company’s assets and liabilities which are accounted for using the fair value option:

	March 31, 2013		December 31, 2012
Fixed maturities	$	364,385	$	363,541
Other investments	537,845		527,971
Equity securities	—		25,954
Investments accounted for using the fair value option	902,230		917,466
Securities sold but not yet purchased (1)	—		(6,924		)
Net assets accounted for using the fair value option	$	902,230	$	910,542

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(1) Represents the Company’s obligation to deliver equity 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.

Components of net investment income

The components of net investment income were derived from the following sources:

	Three Months Ended
	March 31,
	2013			2012
Fixed maturities	$	62,006		$	73,450
Term loan investments (1)	4,217			2,299
Equity securities	1,423			1,664
Short-term investments	392			372
Other (2)	6,299			3,193
Gross investment income	74,337			80,978
Investment expenses	(8,665		)	(6,681		)
Net investment income	$	65,672		$	74,297

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(1) Included in “investments accounted for using the fair value option” on the Company’s consolidated balance sheets.

(2) Amounts include dividends on investment funds and other items.

Summary of net realized gains (losses)

Net realized gains (losses) were as follows, excluding other-than-temporary impairment provisions:

	Three Months Ended
	March 31,
	2013			2012
Available for sale securities:
Gross gains on investment sales	$	67,020		$	48,012
Gross losses on investment sales	(25,056		)	(17,936		)
Change in fair value of assets and liabilities accounted for using the fair value option:
Fixed maturities	5,058			8,217
Equity securities	699			3,387
Other investments	9,951			3,753
TALF investments	—			1,224
TALF borrowings	—			1,071
Derivative instruments (1)	(378		)	(4,669		)
Other	1,046			1,062
Net realized gains	$	58,340		$	44,121

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(1) See Note 9 for information on the Company’s derivative instruments.

Summary of OTTI recognized in earnings by asset class

The following table details the net impairment losses recognized in earnings by asset class:

	Three Months Ended
	March 31,
	2013			2012
Fixed maturities:
Mortgage backed securities	$	(15	)	$	(746	)
Corporate bonds	—			(196		)
Asset backed securities	(20		)	—
Total	(35		)	(942		)
Investment of funds received under securities lending agreements	—			(81		)
Equity securities	(2,211		)	—
Net impairment losses recognized in earnings	$	(2,246	)	$	(1,023	)

Rollforward of the amount related to credit losses recognized in earnings for which a portion was recognized in AOCI

The following table provides a roll forward of the amount related to credit losses recognized in earnings for which a portion of an OTTI was recognized in accumulated other comprehensive income:

	Three Months Ended
	March 31,
	2013			2012
Balance at start of period	$	62,001		$	66,545
Credit loss impairments recognized on securities not previously impaired	33			212
Credit loss impairments recognized on securities previously impaired	2			811
Reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security	—			—
Reductions for securities sold during the period	(80		)	(482		)
Balance at end of period	$	61,956		$	67,086

Summary of restricted assets

The following table details the value of the Company’s restricted assets:

	March 31, 2013		December 31, 2012
Assets used for collateral or guarantees:
Affiliated transactions	$	4,104,426	$	4,062,097
Third party agreements	791,160		771,631
Deposits with U.S. regulatory authorities	308,110		290,441
Deposits with non-U.S. regulatory authorities	6,843		247,321
Trust funds	110,266		96,342
Total restricted assets	$	5,320,805	$	5,467,832