Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2021 | Jan. 28, 2022 | Jun. 30, 2021 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2021 | ||
Document Transition Report | false | ||
Entity File Number | 1-16725 | ||
Entity Registrant Name | PRINCIPAL FINANCIAL GROUP, INC | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Address, Address Line One | 711 High Street | ||
Entity Address, City or Town | Des Moines | ||
Entity Address, State or Province | IA | ||
Entity Address, Postal Zip Code | 50392 | ||
Entity Tax Identification Number | 42-1520346 | ||
City Area Code | 515 | ||
Local Phone Number | 247-5111 | ||
Title of 12(b) Security | Common Stock, par value $0.01 | ||
Trading Symbol | PFG | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 261,227,525 | ||
Entity Public Float | $ 17 | ||
Entity Central Index Key | 0001126328 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2021 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Auditor Name | Ernst & Young LLP | ||
Auditor Firm ID | 42 | ||
Auditor Location | Des Moines, Iowa |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Fixed maturities, available-for-sale | $ 78,154.5 | $ 78,710.3 |
Fixed maturities, trading | 422.2 | 532.1 |
Equity securities (2021 and 2020 include $783.7 million and $902.5 million related to consolidated variable interest entities) | 2,347.2 | 2,013.4 |
Mortgage loans (2021 and 2020 include $1,260.1 million and $319.0 million related to consolidated variable interest entities) | 19,668.7 | 17,343 |
Real estate (2021 and 2020 include $672.0 million and $476.8 million related to consolidated variable interest entities) | 2,075.4 | 1,797.3 |
Policy loans | 759.6 | 784 |
Other investments (2021 and 2020 include $522.8 million and $348.5 million related to consolidated variable interest entities and $0.0 million and $28.5 million measured at fair value under the fair value option) | 5,478.3 | 5,126.8 |
Total investments | 108,905.9 | 106,306.9 |
Cash and cash equivalents (2021 and 2020 include $49.6 million and $28.8 million related to consolidated variable interest entities) | 2,332 | 2,849.8 |
Accrued investment income | 695.8 | 710.6 |
Premiums due and other receivables | 1,842.4 | 1,723.8 |
Deferred acquisition costs | 3,757.5 | 3,409.7 |
Property and equipment | 1,038 | 1,019 |
Goodwill | 1,627.6 | 1,711 |
Other intangibles | 1,600.6 | 1,723 |
Separate account assets (2021 and 2020 include $33,957.7 million and $41,138.9 million related to consolidated variable interest entities) | 182,345.4 | 175,951.4 |
Other assets | 512 | 1,222.5 |
Total assets | 304,657.2 | 296,627.7 |
Liabilities | ||
Contractholder funds (2021 and 2020 include $344.0 million and $388.6 million related to consolidated variable interest entities) | 43,598 | 43,237.7 |
Future policy benefits and claims | 43,948.1 | 45,207.2 |
Other policyholder funds | 1,071 | 1,059.4 |
Short-term debt | 79.8 | 84.7 |
Long-term debt | 4,280.2 | 4,279.2 |
Income taxes currently payable | 15.5 | 22.3 |
Deferred income taxes | 2,320.2 | 2,330.8 |
Separate account liabilities (2021 and 2020 include $33,957.7 million and $41,138.9 million related to consolidated variable interest entities) | 182,345.4 | 175,951.4 |
Other liabilities (2021 and 2020 include $58.7 million and $24.5 million related to consolidated variable interest entities) | 10,540.7 | 7,582.1 |
Total liabilities | 288,198.9 | 279,754.8 |
Redeemable noncontrolling interest (2021 and 2020 include $304.0 million and $226.8 million related to consolidated variable interest entities) | 332.5 | 255.6 |
Stockholders' equity | ||
Common stock, par value $0.01 per share; 2,500.0 million shares authorized; 484.9 million and 481.9 million shares issued as of 2021 and 2020; 261.7 million and 273.3 million shares outstanding as of 2021 and 2020 | 4.8 | 4.8 |
Additional paid-in capital | 10,495 | 10,321.6 |
Retained earnings | 12,884.5 | 11,838 |
Accumulated other comprehensive income | 1,610.9 | 2,383.1 |
Treasury stock, at cost (223.2 million and 208.6 million shares as of 2021 and 2020) | (8,925.8) | (7,988.6) |
Total stockholders' equity attributable to Principal Financial Group, Inc. | 16,069.4 | 16,558.9 |
Noncontrolling interest | 56.4 | 58.4 |
Total stockholders' equity | 16,125.8 | 16,617.3 |
Total liabilities and stockholders' equity | $ 304,657.2 | $ 296,627.7 |
Consolidated Statements of Fi_2
Consolidated Statements of Financial Position (Parenthetical) - USD ($) shares in Millions, $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Equity securities | $ 2,347.2 | $ 2,013.4 |
Mortgage loans | 19,668.7 | 17,343 |
Real estate | 2,075.4 | 1,797.3 |
Other investments | 5,478.3 | 5,126.8 |
Cash and Cash Equivalents, at Carrying Value | 2,332 | 2,849.8 |
Other investments measured at fair value under fair value option | 0 | 28.5 |
Separate account assets | 182,345.4 | 175,951.4 |
Contractholder funds | 43,598 | 43,237.7 |
Separate account liabilities | 182,345.4 | 175,951.4 |
Other liabilities | 10,540.7 | 7,582.1 |
Redeemable noncontrolling interest | $ 332.5 | $ 255.6 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 2,500 | 2,500 |
Common stock, issued (in shares) | 484.9 | 481.9 |
Common stock, outstanding (in shares) | 261.7 | 273.3 |
Treasury stock (in shares) | 223.2 | 208.6 |
Aggregate consolidated variable interest entities | ||
Equity securities | $ 783.7 | $ 902.5 |
Mortgage loans | 1,260.1 | 319 |
Real estate | 672 | 476.8 |
Other investments | 522.8 | 348.5 |
Cash and Cash Equivalents, at Carrying Value | 49.6 | 28.8 |
Separate account assets | 33,957.7 | 41,138.9 |
Contractholder funds | 344 | 388.6 |
Separate account liabilities | 33,957.7 | 41,138.9 |
Other liabilities | 58.7 | 24.5 |
Redeemable noncontrolling interest | $ 304 | $ 226.8 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Premiums and other considerations | $ 4,841.5 | $ 6,037.4 | $ 7,866.6 |
Fees and other revenues | 5,012.6 | 4,511.1 | 4,409.9 |
Net investment income (loss) | 4,406.1 | 3,890.6 | 3,998.4 |
Net realized capital gains (losses) | 2.5 | 302.6 | (52.8) |
Total revenues | 14,262.7 | 14,741.7 | 16,222.1 |
Expenses | |||
Benefits, claims and settlement expenses | 7,097 | 8,281.5 | 9,905.8 |
Dividends to policyholders | 94.8 | 120.2 | 119.1 |
Operating expenses | 4,987.3 | 4,646.5 | 4,503.9 |
Total expenses | 12,179.1 | 13,048.2 | 14,528.8 |
Income before income taxes | 2,083.6 | 1,693.5 | 1,693.3 |
Income taxes (benefits) | 326.2 | 265 | 249.2 |
Net income (loss) | 1,757.4 | 1,428.5 | 1,444.1 |
Net income (losses) attributable to noncontrolling interest | 46.8 | 32.7 | 49.9 |
Net income (loss) attributable to Principal Financial Group, Inc. | $ 1,710.6 | $ 1,395.8 | $ 1,394.2 |
Earnings per common share | |||
Basic earnings per common share (in dollars per share) | $ 6.36 | $ 5.08 | $ 5 |
Diluted earnings per common share (in dollars per share) | $ 6.27 | $ 5.05 | $ 4.96 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Consolidated Statements of Comprehensive Income | |||
Net income (loss) | $ 1,757.4 | $ 1,428.5 | $ 1,444.1 |
Other comprehensive income (loss), net: | |||
Net unrealized gains (losses) on available-for-sale securities | (670.9) | 1,376.5 | 2,616.1 |
Noncredit component of impairment losses on fixed maturities, available-for-sale | 3 | ||
Net unrealized gains (losses) on derivative instruments | 33.6 | (35.2) | (11) |
Foreign currency translation adjustment | (254.2) | 30.6 | (78.7) |
Net unrecognized postretirement benefit obligation | 115.8 | (24.9) | 77.3 |
Other comprehensive income (loss) | (775.7) | 1,347 | 2,606.7 |
Comprehensive income (loss) | 981.7 | 2,775.5 | 4,050.8 |
Comprehensive income (loss) attributable to noncontrolling interest | 43.3 | 34.5 | 53.6 |
Comprehensive income (loss) attributable to Principal Financial Group, Inc. | $ 938.4 | $ 2,741 | $ 3,997.2 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Millions | Common stock | Additional paid-in capital | Retained earnings (accumulated deficit)Effects of implementation of accounting change | Retained earnings (accumulated deficit) | Accumulated other comprehensive income (loss) | Treasury stock | Noncontrolling interest | Effects of implementation of accounting change | Total | |
Balances (ASU 2016-02 - Leases) at Dec. 31, 2018 | $ 4 | $ 4 | ||||||||
Balances at Dec. 31, 2018 | $ 4.8 | $ 10,060.7 | $ 10,290.2 | $ (1,565.1) | $ (7,400.6) | $ 66 | $ 11,456 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Common stock issued | 37.7 | 37.7 | ||||||||
Stock-based compensation | 89.7 | (8.1) | 0.3 | 81.9 | ||||||
Treasury stock acquired, common | (281) | (281) | ||||||||
Dividends to common stockholders | (606) | (606) | ||||||||
Distributions to noncontrolling interest | (20.9) | (20.9) | ||||||||
Contributions from noncontrolling interest | 8.2 | 8.2 | ||||||||
Purchase of subsidiary shares from noncontrolling interest | [1] | (0.5) | (0.1) | (0.6) | ||||||
Adjustments to redemption amount of redeemable noncontrolling interest | (5) | (0.4) | (5.4) | |||||||
Net income (loss) | [1] | 1,394.2 | 16.3 | 1,410.5 | ||||||
Other comprehensive income (loss) | [1] | 2,603 | (1.6) | 2,601.4 | ||||||
Balances (ASU 2016-13 - CECL) at Dec. 31, 2019 | $ (8.4) | $ (8.4) | ||||||||
Balances at Dec. 31, 2019 | 4.8 | 10,182.6 | 11,074.3 | 1,037.9 | (7,681.6) | 67.8 | 14,685.8 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Common stock issued | 42.8 | 42.8 | ||||||||
Stock-based compensation | 96.3 | (9.2) | 87.1 | |||||||
Treasury stock acquired, common | (307) | (307) | ||||||||
Dividends to common stockholders | (614.5) | (614.5) | ||||||||
Distributions to noncontrolling interest | (40.3) | (40.3) | ||||||||
Contributions from noncontrolling interest | 6 | 6 | ||||||||
Purchase of subsidiary shares from noncontrolling interest | [1] | (1.4) | (1.4) | |||||||
Adjustments to redemption amount of redeemable noncontrolling interest | (0.1) | (0.1) | (0.2) | |||||||
Net income (loss) | [1] | 1,395.8 | 25.2 | 1,421 | ||||||
Other comprehensive income (loss) | [1] | 1,345.2 | 1.2 | 1,346.4 | ||||||
Balances at Dec. 31, 2020 | 4.8 | 10,321.6 | 11,838 | 2,383.1 | (7,988.6) | 58.4 | 16,617.3 | |||
Increase (decrease) in stockholders' equity | ||||||||||
Common stock issued | 86.7 | 86.7 | ||||||||
Stock-based compensation | 106.1 | (10) | 0.1 | 96.2 | ||||||
Treasury stock acquired, common | (937.2) | (937.2) | ||||||||
Dividends to common stockholders | (654.1) | (654.1) | ||||||||
Distributions to noncontrolling interest | (33.7) | (33.7) | ||||||||
Contributions from noncontrolling interest | 7.4 | 7.4 | ||||||||
Purchase of subsidiary shares from noncontrolling interest | [1] | (16.4) | (1.7) | (18.1) | ||||||
Adjustments to redemption amount of redeemable noncontrolling interest | (3) | (0.1) | (3.1) | |||||||
Net income (loss) | [1] | 1,710.6 | 29.3 | 1,739.9 | ||||||
Other comprehensive income (loss) | [1] | (772.2) | (3.3) | (775.5) | ||||||
Balances at Dec. 31, 2021 | $ 4.8 | $ 10,495 | $ 12,884.5 | $ 1,610.9 | $ (8,925.8) | $ 56.4 | $ 16,125.8 | |||
[1] | Excludes amounts attributable to redeemable noncontrolling interest. See Note 13, Stockholders’ Equity, for further details. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities | |||
Net income (loss) | $ 1,757.4 | $ 1,428.5 | $ 1,444.1 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Net realized capital (gains) losses | (2.5) | (302.6) | 52.8 |
Depreciation and amortization expense | 275.3 | 251.9 | 226.8 |
Amortization of deferred acquisition costs and contract costs | 317.8 | 412.9 | 371.4 |
Additions to deferred acquisition costs and contract costs | (518.7) | (499.9) | (515.5) |
Stock-based compensation | 96.1 | 87.6 | 82.6 |
(Income) loss from equity method investments, net of dividends received | (166.3) | (10.6) | (111.9) |
Changes in: | |||
Accrued investment income | 13.8 | (24) | (50.4) |
Net cash flows for trading securities and equity securities with operating intent | 99.9 | 144.2 | (53.8) |
Premiums due and other receivables | (100.9) | 16.4 | (247.6) |
Contractholder and policyholder liabilities and dividends | 1,363.5 | 1,591.2 | 3,599.9 |
Current and deferred income taxes (benefits) | 160.2 | 442.5 | 211.2 |
Real estate acquired through operating activities | (73.7) | (16.4) | (64.7) |
Real estate sold through operating activities | 1.8 | 195.5 | 136.1 |
Other assets and liabilities | 10.4 | (89) | 401.1 |
Other | (15.3) | 110.4 | 11.1 |
Net adjustments | 1,461.4 | 2,310.1 | 4,049.1 |
Net cash provided by (used in) operating activities | 3,218.8 | 3,738.6 | 5,493.2 |
Investing activities | |||
Fixed maturities available-for-sale and equity securities with intent to hold: Purchases | (16,625.5) | (15,713.4) | (14,137.1) |
Fixed maturities available-for-sale and equity securities with intent to hold: Sales | 2,735.3 | 3,043.9 | 2,397.4 |
Fixed maturities available-for-sale and equity securities with intent to hold: Maturities | 10,960 | 8,819.5 | 7,064.2 |
Mortgage loans acquired or originated | (5,223.5) | (3,249.5) | (3,487.7) |
Mortgage loans sold or repaid | 2,853.2 | 2,477.2 | 2,335.9 |
Real estate acquired | (281.4) | (230.6) | (127.5) |
Real estate sold | 133.7 | 2.3 | 96.3 |
Net (purchases) sales of property and equipment | (129.9) | (108.8) | (132.4) |
Purchase of business or interests in subsidiaries, net of cash acquired | (1,208.5) | ||
Sale of interests in subsidiaries | 27 | ||
Net change in other investments | (107) | (66.4) | (489.1) |
Net cash provided by (used in) investing activities | (5,658.1) | (5,025.8) | (7,688.5) |
Financing activities | |||
Issuance of common stock | 86.7 | 42.8 | 37.7 |
Acquisition of treasury stock | (937.2) | (307) | (281) |
Payments for financing element derivatives | (39.9) | (30.9) | (26.9) |
Purchase of subsidiary shares from noncontrolling interest | (24.2) | (1.4) | (1.7) |
Dividends to common stockholders | (654.1) | (614.5) | (606) |
Issuance of long-term debt | 608.9 | 504.9 | |
Principal repayments of long-term debt | (1.8) | (65.8) | (32.2) |
Net proceeds from (repayments of) short-term borrowings | 10.2 | (12.6) | 57.5 |
Investment contract deposits | 9,359.8 | 10,284.4 | 9,200 |
Investment contract withdrawals | (8,801) | (8,852.7) | (7,747.7) |
Net increase (decrease) in banking operation deposits | 2,922.9 | 569.7 | 623.4 |
Other | 0.1 | 0.2 | 5.7 |
Net cash provided by (used in) financing activities | 1,921.5 | 1,621.1 | 1,733.7 |
Net increase (decrease) in cash and cash equivalents | (517.8) | 333.9 | (461.6) |
Cash and cash equivalents at beginning of period | 2,849.8 | 2,515.9 | 2,977.5 |
Cash and cash equivalents at end of period | 2,332 | 2,849.8 | 2,515.9 |
Supplemental information: | |||
Cash paid for interest | 166.1 | 162.8 | 157.7 |
Cash paid for (received from) income taxes | 109.9 | (172) | (8.5) |
Changes from re-designation of other postretirement employee benefits ("OPEB") plan assets to cover non-retiree benefits: | |||
Increases in equity securities re-designated from funded status of OPEB plan | 548.1 | ||
Increases in other investments re-designated from funded status of OPEB plan | 117.5 | ||
Decrease in tax receivable re-designated from funded status of OPEB plan | (9.1) | ||
Decrease in accumulated other comprehensive income ("AOCI") due to reclassifying excess assets out of funded status of OPEB plan | 9.1 | ||
Decrease in other assets due to reclassifying excess assets out of funded status of OPEB plan | (665.6) | ||
Lease assets established upon adoption of accounting guidance | 168.8 | ||
Lease liabilities established upon adoption of accounting guidance | 164 | ||
Assets received in kind from pension risk transfer transactions | $ 109.5 | $ 1,325.2 | $ 1,225.8 |
Nature of Operations and Signif
Nature of Operations and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations and Significant Accounting Policies | |
Nature of Operations and Significant Accounting Policies | Principal Financial Group, Inc. Notes to Consolidated Financial Statements December 31, 2021 1. Nature of Operations and Significant Accounting Policies Description of Business Principal Financial Group, Inc. (“PFG”) is a leader in global investment management offering businesses, individuals and institutional clients a wide range of financial products and services, including retirement, asset management and insurance through our diverse family of financial services companies. Basis of Presentation The accompanying consolidated financial statements include the accounts of PFG and all other entities in which we directly or indirectly have a controlling financial interest as well as those variable interest entities (“VIEs”) in which we are the primary beneficiary. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). All significant intercompany accounts and transactions have been eliminated. Uncertainties, including those associated with the novel coronavirus (“COVID-19”), may impact our business, results of operations, financial condition and liquidity. Our use of estimates and assumptions affect amounts reported and disclosed and includes, but is not limited to, the fair value of investments in the absence of quoted market values, investment impairments and valuation allowances, the fair value of derivatives, deferred acquisition costs (“DAC”) and other actuarial balances, measurement of goodwill and intangible assets, the liability for future policy benefits and claims, the value of pension and other postretirement benefits and accounting for income taxes and the valuation of deferred tax assets. Our estimates and assumptions could change in the future as more information becomes known about the impact of COVID-19. Our results of operations and financial condition may also be impacted by other uncertainties including evolving regulatory, legislative and standard-setter accounting interpretations and guidance. Certain reclassifications have been made to prior periods relating to the significant components of net deferred income taxes to conform to the current presentation. See Note 10, Income Taxes, under the caption “Net Deferred Income Taxes.” Consolidation We have relationships with various special purpose entities and other legal entities that must be evaluated to determine if the entities meet the criteria of a VIE or a voting interest entity (“VOE”). This assessment is performed by reviewing contractual, ownership and other rights, including involvement of related parties, and requires use of judgment. First, we determine if we hold a variable interest in an entity by assessing if we have the right to receive expected losses and expected residual returns of the entity. If we hold a variable interest, then the entity is assessed to determine if it is a VIE. An entity is a VIE if the equity at risk is not sufficient to support its activities, if the equity holders lack a controlling financial interest or if the entity is structured with non-substantive voting rights. In addition to the previous criteria, if the entity is a limited partnership or similar entity, it is a VIE if the limited partners do not have the power to direct the entity’s most significant activities through substantive kick-out rights or participating rights. A VIE is evaluated to determine the primary beneficiary. The primary beneficiary of a VIE is the enterprise with (1) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. When we are the primary beneficiary, we are required to consolidate the entity in our financial statements. We reassess our involvement with VIEs on a quarterly basis. For further information about VIEs, refer to Note 3, Variable Interest Entities. If an entity is not a VIE, it is considered a VOE. VOEs are generally consolidated if we own a greater than 50% voting interest. If we determine our involvement in an entity no longer meets the requirements for consolidation under either the VIE or VOE models, the entity is deconsolidated. Entities in which we have management influence over the operating and financing decisions but are not required to consolidate, other than investments accounted for at fair value under the fair value option, are reported using the equity method. Recent Accounting Pronouncements Description Date of adoption Effect on our consolidated financial statements or other significant matters Standards not yet adopted: Targeted improvements to the accounting for long-duration insurance contracts This authoritative guidance updates certain requirements in the accounting for long-duration insurance and annuity contracts. 1. The assumptions used to calculate the liability for future policy benefits on traditional and limited-payment contracts will be reviewed and updated periodically. Cash flow assumptions will be reviewed at least annually and updated when necessary with the impact recognized in net income. Discount rate assumptions are prescribed as the current upper-medium grade (low credit risk) fixed income instrument yield and will be updated quarterly with the impact recognized in other comprehensive income (“OCI”). 2. Market risk benefits, which are contracts or contract features that provide protection to the policyholder from capital market risk and expose us to other-than-nominal capital market risk, are measured at fair value. The periodic change in fair value is recognized in net income with the exception of the periodic change in fair value related to our own nonperformance risk, which is recognized in OCI. 3. DAC and other actuarial balances for all insurance and annuity contracts will be amortized on a constant basis over the expected term of the related contracts. 4. Additional disclosures are required, including disaggregated rollforwards of significant insurance liabilities and other account balances as well as disclosures about significant inputs, judgments, assumptions and methods used in measurement. The guidance for the liability for future policy benefits for traditional and limited-payment contracts and DAC will be applied on a modified retrospective basis; that is, to contracts in force as of the beginning of the earliest period presented based on their existing carrying amounts. An entity may elect to apply the changes retrospectively. The guidance for market risk benefits will be applied retrospectively. Early adoption is permitted. January 1, 2023 Our implementation and evaluation process to date includes, but is not limited to the following: ● ● ● ● ● ● ● ● ● ● This guidance will significantly change how we account for many of our insurance and annuity products. As we progress through our implementation, we will be able to better assess the impact to our consolidated financial statements. Description Date of adoption Effect on our consolidated financial statements or other significant matters Standards adopted: Simplifying the accounting for income taxes This authoritative guidance simplifies the accounting for income taxes by removing certain exceptions, including exceptions related to the incremental approach for intraperiod tax allocation, calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. Also, the guidance clarifies the accounting for franchise taxes, transactions that result in a step-up in the tax basis of goodwill and enacted changes in tax laws or rates. It specifies that an entity is not required to allocate the consolidated amount of current and deferred tax expense to a legal entity that is not subject to tax in its separate financial statements, although an entity may elect to do so. The guidance will be applied based on varying transition methods defined by amendment. Early adoption is permitted. January 1, 2021 This guidance did not have a material impact on our consolidated financial statements. Facilitation of the effects of reference rate reform on financial reporting This authoritative guidance provides optional expedients and exceptions for contracts and hedging relationships affected by reference rate reform. An entity may elect not to apply certain modification accounting requirements to contracts affected by reference rate reform and instead account for the modified contract as a continuation of the existing contract. Also, an entity may apply optional expedients to continue hedge accounting for hedging relationships in which the critical terms change due to reference rate reform. This guidance eases the financial reporting impacts of reference rate reform on contracts and hedging relationships and is effective until December 31, 2022. March 12, 2020 We adopted the guidance upon issuance prospectively and elected the applicable optional expedients and exceptions for contracts and hedging relationships impacted by reference rate reform through December 31, 2022. The guidance did not have an impact on our consolidated financial statements upon adoption. Goodwill impairment testing This authoritative guidance simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 (which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill to the carrying amount of that goodwill) from the goodwill impairment test. A goodwill impairment loss will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. January 1, 2020 This guidance reduces complexity and costs associated with performing a Step 2 test, should one be needed in the future. This guidance did not have a material impact on our consolidated financial statements at adoption. Credit losses This authoritative guidance requires entities to use a current expected credit loss (“CECL”) model to measure impairment for most financial assets that are not recorded at fair value through net income. Under the CECL model, an entity will estimate lifetime expected credit losses considering available relevant information about historical events, current conditions and reasonable and supportable forecasts. The CECL model does not apply to available-for-sale debt securities; however, the credit loss calculation and subsequent recoveries for available-for-sale securities are required to be recorded through an allowance. This guidance also expands the required credit loss disclosures. January 1, 2020 We adopted the guidance using the modified retrospective approach. A cumulative effect adjustment of $8.4 million was recorded as a decrease to retained earnings. We recorded an offsetting increase in the allowance for credit loss for mortgage loans, reinsurance recoverables and commitments and a decrease for deferred tax impacts. See Note 4, Investments, for further details. Description Date of adoption Effect on our consolidated financial statements or other significant matters Implementation costs in a cloud computing arrangement that is a service contract This authoritative guidance aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance can be applied either retrospectively or prospectively. January 1, 2019 The effective date of the guidance was January 1, 2020; however, we elected to early-adopt this guidance on a prospective basis, effective January 1, 2019. This guidance did not have a material impact on our consolidated financial statements. Nonemployee share-based payment accounting This authoritative guidance simplifies the accounting for share-based payments to nonemployees by generally aligning it with the accounting for share-based payments to employees. Under the guidance, the measurement of equity-classified nonemployee awards will be fixed at the grant date, where previously the measurement was fixed at performance completion date. The guidance will be applied to equity-classified nonemployee awards for which a measurement date has not been established as of the date of adoption. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. Leases This authoritative guidance requires lessee recognition of lease assets and lease liabilities on the consolidated statements of financial position. The concept of an operating lease, where the lease assets and liabilities are not reported on the consolidated statements of financial position, is eliminated under the new guidance. For lessors, the guidance modifies lease classification criteria and accounting for certain types of leases. Other key aspects of the guidance relate to the removal of the current real estate-specific guidance and new presentation and disclosure requirements. Lessees and lessors are required to recognize and measure leases using a modified retrospective approach, which includes certain optional practical expedients that may be elected. We elected the alternative transition method, which allows entities to initially apply the new standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption. January 1, 2019 We adopted the guidance using the modified retrospective approach. A cumulative effect adjustment of $4.0 million was recorded as an increase to retained earnings. See Note 12, Contingencies, Guarantees, Indemnifications and Leases, for further details. Targeted improvements to accounting for hedging activities This authoritative guidance updated certain recognition and measurement requirements for hedge accounting. The objective of the guidance is to more closely align the economics of a company’s risk management activities in its financial results and reduce the complexity of applying hedge accounting. The updates included the expansion of hedging strategies that are eligible for hedge accounting, elimination of the separate measurement and reporting of hedge ineffectiveness, presentation of the changes in the fair value of the hedging instrument in the same consolidated statement of operations line as the earnings effect of the hedged item and simplification of hedge effectiveness assessments. This guidance also included new disclosures. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. See Note 5, Derivative Financial Instruments, for further details. Description Date of adoption Effect on our consolidated financial statements or other significant matters Premium amortization on purchased callable debt securities This authoritative guidance applies to entities that hold certain non-contingently callable debt securities, where the amortized cost basis is at a premium to the price repayable by the issuer at the earliest call date. Under the guidance the premium will be amortized to the first call date. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. When we adopt new accounting standards, we have a process in place to perform a thorough review of the pronouncement, identify the financial statement and system impacts and create an implementation plan among our impacted business units to ensure we are compliant with the pronouncement on the date of adoption. This includes having effective processes and controls in place to support the reported amounts. Each of the standards listed above is in varying stages in our implementation process based on its issuance and adoption dates. We are on track to implement guidance by the respective effective dates. Use of Estimates in the Preparation of Financial Statements The preparation of our consolidated financial statements and accompanying notes requires management to make estimates and assumptions that affect the amounts reported and disclosed. These estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the consolidated financial statements and accompanying notes. The most critical estimates include those used in determining: ● the fair value of investments in the absence of quoted market values; ● investment impairments and valuation allowances; ● the fair value of and accounting for derivatives; ● the DAC and other actuarial balances where the amortization is based on estimated gross profits (“EGPs”); ● the measurement of goodwill, indefinite lived intangible assets, finite lived intangible assets and related impairments or amortization, if any; ● the liability for future policy benefits and claims; ● the value of our pension and other postretirement benefit obligations and ● accounting for income taxes and the valuation of deferred tax assets. A description of such critical estimates is incorporated within the discussion of the related accounting policies that follow. In applying these policies, management makes subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Actual results could differ from these estimates. Closed Block Principal Life Insurance Company (“Principal Life”) operates a closed block (“Closed Block”) for the benefit of individual participating dividend-paying policies in force at the time of the 1998 mutual insurance holding company (“MIHC”) formation. See Note 6, Closed Block, for further details. Cash and Cash Equivalents Cash and cash equivalents include cash on hand, money market instruments and other debt issues with a maturity date of three months or less when purchased. Investments Fixed maturities include bonds, asset-backed securities (“ABS”), redeemable preferred stock and certain non-redeemable preferred securities. Equity securities include mutual funds, common stock, non-redeemable preferred stock and required regulatory investments. We classify fixed maturities as either available-for-sale or trading at the time of the purchase and, accordingly, carry them at fair value. Equity securities are also carried at fair value. See Note 14, Fair Value Measurements, for methodologies related to the determination of fair value. Unrealized gains and losses related to fixed maturities, available-for-sale, excluding those in fair value hedging relationships, are reflected in stockholders’ equity, net of adjustments associated with DAC and related actuarial balances, derivatives in cash flow hedge relationships and applicable income taxes. Mark-to-market adjustments on certain equity securities and mark-to-market adjustments on certain fixed maturities, trading are reflected in net realized capital gains (losses). Unrealized gains and losses related to hedged portions of fixed maturities, available-for-sale in fair value hedging relationships are reflected in net investment income. Mark-to-market adjustments related to certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reflected in net investment income. The amortized cost of fixed maturities includes cost adjusted for amortization of premiums and discounts, computed using the interest method. The amortized cost of fixed maturities, available-for-sale is adjusted for changes in fair value of the hedged portions of securities in fair value hedging relationships and excludes accrued interest receivable. Accrued interest receivable is reported in accrued investment income on the consolidated statements of financial position. Beginning in 2020, fixed maturities, available-for-sale are subject to an allowance for credit loss and changes in the allowance are reported in net income as a component of net realized capital gains (losses). Prior to 2020, the amortized cost of fixed maturities classified as available-for-sale was adjusted for declines in value that were other than temporary. Prior to 2020, impairments in value deemed to be other than temporary were primarily reported in net income as a component of net realized capital gains (losses), with noncredit impairment losses for certain fixed maturities, available-for-sale reported in OCI. Interest income, as well as prepayment fees and the amortization of the related premium or discount, is reported in net investment income. For loan-backed and structured securities, we recognize income using a constant effective yield based on currently anticipated cash flows. Commercial and residential mortgage loans are generally reported at cost adjusted for amortization of premiums and accrual of discounts, computed using the interest method and net of valuation allowances. Amortized cost excludes accrued interest receivable. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Interest income, as well as prepayment of fees and the amortization of the related premium or discount, is reported in net investment income on the consolidated statements of operations. Accrued interest receivable is reported in accrued investment income on the consolidated statements of financial position. Any changes in the loan valuation allowances are reported in net realized capital gains (losses) on the consolidated statements of operations. See Note 4, Investments, for further details of our valuation allowance. Our commercial and residential mortgage loan portfolios can include loans that have been modified. We assess loan modifications on a case-by-case basis to evaluate whether a troubled debt restructuring (“TDR”) has occurred. In response to COVID-19, the Coronavirus Aid, Relief and Economic Security Act, which was subsequently amended by the Consolidated Appropriations Act, 2021, (collectively the “CARES Act”) provides a temporary suspension of TDR accounting for certain COVID-19 related loan modifications where the loan was not more than 30 days past due as of December 31, 2019. We elected the TDR relief in the CARES Act beginning in the second quarter of 2020. The CARES Act TDR relief does not apply to modifications completed subsequent to the earlier of 60 days after the national emergency related to COVID-19 ends, or January 1, 2022. In addition, the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus (As Revised on April 7, 2020) (“Interagency Statement”) provides additional guidance to determine if a short-term COVID-19 related loan modification is a TDR. We consider the CARES Act and the Interagency Statement when assessing loan modifications to determine whether a TDR has occurred. See Note 4, Investments, under the caption “Mortgage Loan Modifications” for further details. Real estate investments are reported at cost less accumulated depreciation. The initial cost bases of properties acquired through loan foreclosures are the lower of the fair market values of the properties at the time of foreclosure or the outstanding loan balance. Buildings and land improvements are generally depreciated on the straight-line method over the estimated useful life of improvements and tenant improvement costs are depreciated on the straight-line method over the term of the related lease. We recognize impairment losses for properties when indicators of impairment are present and a property’s expected undiscounted cash flows are not sufficient to recover the property’s carrying value. In such cases, the cost basis of the property is reduced to fair value. Real estate expected to be disposed is carried at the lower of cost or fair value, less cost to sell, with valuation allowances established accordingly and depreciation no longer recognized. The carrying amount of real estate held for sale was $88.7 million and $2.0 million as of December 31, 2021 and 2020, respectively. Any impairment losses and any changes in valuation allowances are reported in net income. Net realized capital gains and losses on sales of investments are determined on the basis of specific identification. In general, in addition to realized capital gains and losses on investment sales and periodic settlements on derivatives not designated as hedges, we report gains and losses related to the following in net realized capital gains (losses) on the consolidated statements of operations: mark-to-market adjustments on certain equity securities, mark-to-market adjustments on certain fixed maturities, trading, mark-to-market adjustments on sponsored investment funds, mark-to-market adjustments on derivatives not designated as hedges, cash flow hedge gains (losses) when the hedged item impacts realized capital gains (losses), changes in the valuation allowance for fixed maturities, available-for-sale and certain financing receivables, impairments of real estate held for investment, impairments of equity method investments and, prior to 2020, other-than-temporary impairments of securities and subsequent realized recoveries. Investment gains and losses on sales of certain real estate held for sale due to investment strategy and mark-to-market adjustments on certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reported as net investment income and are excluded from net realized capital gains (losses). Policy loans and certain other investments are reported at cost. Interests in unconsolidated entities, joint ventures and partnerships are generally accounted for using the equity method. We have other investments reported at fair value or for which the fair value option has been elected in prior periods. See Note 14, Fair Value Measurements, for detail on these investments. Derivatives Overview Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices or the values of securities. Derivatives generally used by us include swaps, options, futures and forwards. Derivative positions are either assets or liabilities in the consolidated statements of financial position and are measured at fair value, generally by obtaining quoted market prices or through the use of pricing models. See Note 14, Fair Value Measurements, for policies related to the determination of fair value. Fair values can be affected by changes in interest rates, foreign exchange rates, financial indices, values of securities, credit spreads, and market volatility and liquidity. Accounting and Financial Statement Presentation We designate derivatives as either: (a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment, including those denominated in a foreign currency (“fair value hedge”); (b) a hedge of a forecasted transaction or the exposure to variability of cash flows to be received or paid related to a recognized asset or liability, including those denominated in a foreign currency (“cash flow hedge”); (c) a hedge of a net investment in a foreign operation or (d) a derivative not designated as a hedging instrument. Our accounting for the ongoing changes in fair value of a derivative depends on the intended use of the derivative and the designation, as described above, and is determined when the derivative contract is entered into or at the time of redesignation. Hedge accounting is used for derivatives that are specifically designated in advance as hedges and that reduce our exposure to an indicated risk by having a high correlation between changes in the value of the derivatives and the items being hedged at both the inception of the hedge and throughout the hedge period. Cash flows associated with derivatives are included within operating and financing activities in the consolidated statements of cash flows. Fair Value Hedges. Cash Flow Hedges. Net Investment in a Foreign Operation Hedge. Non-Hedge Derivatives. Hedge Documentation and Effectiveness Testing. hedge is determined to be highly effective, the hedge may still result in a mismatch between the change in the fair value of the hedging instrument and the change in the fair value of the hedged item attributable to the hedged risk. We use qualitative and quantitative methods to assess hedge effectiveness. Qualitative methods may include monitoring changes to terms and conditions and counterparty credit ratings. Quantitative methods may include statistical tests including regression analysis and minimum variance and dollar offset techniques. For last-of-layer method hedges, the assessment of hedge effectiveness includes confirming we expect the hedged last layer amount to be outstanding at the end of the hedging relationship. Termination of Hedge Accounting. If it is determined that a derivative no longer qualifies as an effective hedge, the derivative will continue to be carried on the consolidated statements of financial position at its fair value, with changes in fair value recognized prospectively in net realized capital gains (losses). The asset or liability under a fair value hedge will no longer be adjusted for changes in fair value pursuant to hedging rules and the existing basis adjustment is amortized to the consolidated statements of operations line associated with the asset or liability. If a last-of-layer method hedging relationship is discontinued, the outstanding basis adjustment is allocated to the individual assets in the closed portfolio and those amounts are amortized consistent with the amortization of other discounts or premiums associated with those assets. The component of AOCI related to discontinued cash flow hedges that are no longer highly effective is amortized to the consolidated statements of operations consistent with the net income impacts of the original hedged cash flows. If a cash flow hedge is discontinued because it is probable the hedged forecasted transaction will not occur, the deferred gain or loss is immediately reclassified from AOCI into net income. Embedded Derivatives. Contractholder and Policyholder Liabilities Contractholder and policyholder liabilities (contractholder funds, future policy benefits and claims and other policyholder funds) include reserves for investment contracts, individual and group annuities that provide periodic income payments, universal life insurance, variable universal life insurance, indexed universal life insurance, term life insurance, participating traditional individual life insurance, group dental and vision insurance, group critical illness, group accident, group short-term and long-term disability insurance, group life insurance, individual disability insurance and long-term care insurance. It also includes a provision for dividends on participating policies. Investment contracts are contractholders’ funds on deposit with us and generally include reserves for pension and annuity contracts. Reserves on investment contracts are equal to the cumulative deposits less any applicable charges and withdrawals plus credited interest. Reserves for universal life, variable universal life and indexed universal life insurance contracts are equal to cumulative deposits less charges plus credited interest, which represents the account balances that accrue to the benefit of the policyholders. We hold additional reserves on certain long-duration contracts where benefit features result in gains in early years followed by losses in later years; universal life, variable universal life and indexed universal life insurance contracts that contain no lapse guarantee features; and annuities with guaranteed minimum death benefits. Reserves for individual and group annuities that provide periodic income payments, nonparticipating term life insurance and disability income contracts are computed on a basis of assumed investment yield, mortality, morbidity and expenses, including a provision for adverse deviation, which generally varies by plan, year of issue and policy duration. Investment yield is based on our experience. Mortality, morbidity and withdrawal rate assumptions are based on our experience and are periodically reviewed against both industry standards and experience. For long-duration insurance contracts, significant changes in experience or assumptions may require us to provide for expected f |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Other Intangible Assets | |
Goodwill and Other Intangible Assets | 2. Goodwill and Other Intangible Assets Goodwill The changes in the carrying amount of goodwill reported in our segments were as follows: Retirement Principal U.S. and Income Global Principal Insurance Solutions Investors International Solutions Corporate Consolidated (in millions) Balance as of January 1, 2020 $ 675.9 $ 317.5 $ 642.8 $ 56.6 $ 1.0 $ 1,693.8 Foreign currency — 3.4 13.8 — — 17.2 Balance as of December 31, 2020 675.9 320.9 656.6 56.6 1.0 1,711.0 Goodwill disposed (1) — — (2.3) — — (2.3) Impairment (2) — — — — (1.0) (1.0) Foreign currency — (2.5) (77.6) — — (80.1) Balance as of December 31, 2021 $ 675.9 $ 318.4 $ 576.7 $ 56.6 $ — $ 1,627.6 (1) Relates to the sale of our India asset management business. (2) Relates to the buyout of the minority interest in RobustWealth, Inc. (“RobustWealth”) and realignment of the business. Finite Lived Intangible Assets Amortized intangible assets primarily relate to customer relationship intangibles associated with our acquisition of the Institutional Retirement & Trust business of Wells Fargo Bank, N.A. (the “Acquired Business”) and previous acquisitions in Chile, Mexico and Hong Kong. The finite lived intangible assets that continue to be subject to amortization over a weighted average remaining expected life of 17 years were as follows: December 31, 2021 2020 (in millions) Gross carrying value $ 1,262.8 $ 1,338.2 Accumulated amortization 432.1 405.6 Net carrying value $ 830.7 $ 932.6 During 2021 and 2020, we fully amortized other finite lived intangible assets of $15.0 million and $18.7 million, respectively. The amortization expense for intangible assets with finite useful lives was $75.3 million, $73.5 million and $62.8 million for 2021, 2020 and 2019, respectively. As of December 31, 2021, the estimated amortization expense for the next five years is as follows (in millions): Year ending December 31: 2022 $ 71.1 2023 68.3 2024 67.0 2025 60.7 2026 56.6 Indefinite Lived Intangible Assets The net carrying amount of unamortized indefinite lived intangible assets was $769.9 million and $790.4 million as of December 31, 2021 and 2020, respectively. As of both December 31, 2021 and 2020, $608.0 million relates to investment management contracts associated with our acquisition of WM Advisors, Inc. in 2006. The remaining balance primarily relates to the trade name intangible associated with our acquisition of Administradora de Fondos de Pensiones Cuprum S.A. (“Cuprum”) in 2013. |
Variable Interest Entities
Variable Interest Entities | 12 Months Ended |
Dec. 31, 2021 | |
Variable Interest Entities | |
Variable Interest Entities | 3. Variable Interest Entities We have relationships with various types of entities which may be VIEs. Certain VIEs are consolidated in our financial results. See Note 1, Nature of Operations and Significant Accounting Policies, under the caption “Consolidation” for further details of our consolidation accounting policies. We did not provide financial or other support to investees designated as VIEs for the periods ended December 31, 2021 and December 31, 2020. Consolidated Variable Interest Entities Mandatory Retirement Savings Funds We hold an equity interest in Chilean mandatory privatized social security funds in which we provide asset management services. We determined the mandatory privatized social security funds, which also include contributions for voluntary pension savings, voluntary non-pension savings and compensation savings accounts, are VIEs. This is because the equity holders as a group lack the power, due to voting rights or similar rights, to direct the activities of the entity that most significantly impact the entity’s economic performance and also because equity investors are protected from below-average market investment returns relative to the industry’s return, due to a regulatory guarantee that we provide. Further we concluded we are the primary beneficiary through our power to make decisions and our significant variable interest in the funds. The purpose of the funds, which reside in legally segregated entities, is to provide long-term retirement savings. The obligation to the customer is directly related to the assets held in the funds and, as such, we present the assets as separate account assets and the obligation as separate account liabilities within our consolidated statements of financial position. Principal International Hong Kong offers retirement pension schemes in which we provide trustee, administration and asset management services to employers and employees under the Hong Kong Mandatory Provident Fund and Occupational Retirement Schemes Ordinance pension schemes. Each pension scheme has various guaranteed and non-guaranteed constituent funds, or investment options, in which customers can invest their money. The guaranteed funds provide either a guaranteed rate of return to the customer or a minimum guarantee on withdrawals under certain qualifying events. We determined the guaranteed funds are VIEs due to the fact the equity holders, as a group, lack the obligation to absorb expected losses due to the guarantee we provide. We concluded we are the primary beneficiary because we have the power to make decisions and to receive benefits and the obligation to absorb losses that could be potentially significant to the VIE. Therefore, we consolidate the underlying assets and liabilities of the funds and present as separate accounts or within the general account, depending on the terms of the guarantee. Real Estate We invest in several real estate limited partnerships and limited liability companies. The entities invest in real estate properties. Certain of these entities are VIEs based on the combination of our significant economic interest and related voting rights. We determined we are the primary beneficiary as a result of our power to control the entities through our significant ownership. Due to the nature of these real estate investments, the investment balance will fluctuate as we purchase and sell interests in the entities and as capital expenditures are made to improve the underlying real estate. Sponsored Investment Funds We sponsor and invest in certain investment funds for which we provide asset management services. Although our asset management fee is commensurate with the services provided and consistent with fees for similar services negotiated at arms-length, we have a variable interest for funds where our other interests are more than insignificant. The funds are VIEs as the equity holders lack power through voting rights to direct the activities of the entity that most significantly impact its economic performance. We determined we are the primary beneficiary of the VIEs where our interest in the entity is more than insignificant and we are the asset manager. Residential Mortgage Loans We invest in ABS trusts. The trusts issue various collateralized mortgage obligation certificates and purchase residential mortgage loans. The trusts are considered VIEs due to insufficient equity to sustain themselves. We concluded we are the primary beneficiary as we purchase substantially all of the certificates and have the obligation to absorb losses that could potentially be significant to the VIEs. Assets and Liabilities of Consolidated Variable Interest Entities The carrying amounts of our consolidated VIE assets, which can only be used to settle obligations of consolidated VIEs, and liabilities of consolidated VIEs for which creditors do not have recourse were as follows: December 31, 2021 December 31, 2020 Total Total Total Total assets liabilities assets liabilities (in millions) Mandatory retirement savings funds (1) $ 34,687.0 $ 34,301.8 $ 41,995.2 $ 41,527.9 Real estate (2) 709.6 36.1 499.0 21.3 Sponsored investment funds (3) 609.4 2.5 419.5 3.2 Residential mortgage loans (4) 1,263.2 20.3 319.8 — Total $ 37,269.2 $ 34,360.7 $ 43,233.5 $ 41,552.4 (1) The assets of the mandatory retirement savings funds primarily include separate account assets and equity securities. The liabilities primarily include separate account liabilities and contractholder funds. (2) The assets of the real estate VIEs primarily include real estate and cash. Liabilities primarily include other liabilities. (3) The assets of sponsored investment funds are primarily fixed maturities and equity securities, certain of which are reported with other investments, and cash. The consolidated statements of financial position included a $304.0 million and $226.8 million redeemable noncontrolling interest for sponsored investment funds as of December 31, 2021 and December 31, 2020, respectively. (4) The assets of the residential mortgage loans VIEs primarily include residential mortgage loans. The liabilities include other liabilities as of December 31, 2021. Unconsolidated Variable Interest Entities We hold a variable interest in a number of VIEs where we are not the primary beneficiary. Our investments in these VIEs are reported in fixed maturities, available-for-sale; fixed maturities, trading; equity securities and other investments in the consolidated statements of financial position and are described below. Unconsolidated VIEs include certain commercial mortgage-backed securities (“CMBS”), residential mortgage-backed pass-through securities (“RMBS”) and other ABS. All of these entities were deemed VIEs because the equity within these entities is insufficient to sustain them. We determined we are not the primary beneficiary in the entities within these categories of investments. This determination was based primarily on the fact we do not own the class of security that controls the unilateral right to replace the special servicer or equivalent function. We invest in cash collateralized debt obligations, collateralized bond obligations, collateralized loan obligations and other collateralized structures, which are VIEs due to insufficient equity to sustain the entities. We have determined we are not the primary beneficiary of these entities primarily because we do not control the economic performance of the entities and were not involved with the design of the entities or because we do not have a potentially significant variable interest in the entities for which we are the asset manager. We have invested in various VIE trusts and similar entities as a debt holder. Most of these entities are classified as VIEs due to insufficient equity to sustain them. In addition, we have an entity classified as a VIE based on the combination of our significant economic interest and lack of voting rights. We have determined we are not the primary beneficiary primarily because we do not control the economic performance of the entities and were not involved with the design of the entities. We have invested in partnerships and other funds, which are classified as VIEs. The entities are VIEs as equity holders lack the power to control the most significant activities of the entities because the equity holders do not have either the ability by a simple majority to exercise substantive kick-out rights or substantive participating rights. We have determined we are not the primary beneficiary because we do not have the power to direct the most significant activities of the entities. As previously discussed, we sponsor and invest in certain investment funds that are VIEs. We determined we are not the primary beneficiary of the VIEs for which we are the asset manager but do not have a potentially significant variable interest in the funds. We hold an equity interest in Mexican mandatory privatized social security funds in which we provide asset management services. Our equity interest in the funds is considered a variable interest. We concluded the funds are VIEs because the equity holders as a group lack decision-making ability through their voting rights. We are not the primary beneficiary of the VIEs because although we, as the asset manager, have the power to direct the activities of the VIEs, we do not have a potentially significant variable interest in the funds. The carrying value and maximum loss exposure for our unconsolidated VIEs were as follows: Maximum exposure to Asset carrying value loss (1) (in millions) December 31, 2021 Fixed maturities, available-for-sale: Corporate $ 142.1 $ 136.9 Residential mortgage-backed pass-through securities 3,152.9 3,122.3 Commercial mortgage-backed securities 5,562.2 5,436.2 Collateralized debt obligations (2) 3,559.6 3,564.7 Other debt obligations 7,560.4 7,487.8 Fixed maturities, trading: Residential mortgage-backed pass-through securities 117.4 117.4 Commercial mortgage-backed securities 25.6 25.6 Collateralized debt obligations (2) 7.5 7.5 Other debt obligations 8.2 8.2 Equity securities 115.4 115.4 Other investments: Other limited partnership and fund interests (3) 1,209.6 2,053.8 December 31, 2020 Fixed maturities, available-for-sale: Corporate $ 296.9 $ 285.7 Residential mortgage-backed pass-through securities 2,986.8 2,857.6 Commercial mortgage-backed securities 4,942.3 4,741.2 Collateralized debt obligations (2) 4,027.5 4,045.9 Other debt obligations 7,045.9 6,832.6 Fixed maturities, trading: Residential mortgage-backed pass-through securities 190.5 190.5 Commercial mortgage-backed securities 27.1 27.1 Collateralized debt obligations (2) 20.6 20.6 Other debt obligations 9.4 9.4 Equity securities 121.7 121.7 Other investments: Other limited partnership and fund interests (3) 999.1 1,739.0 (1) Our risk of loss is limited to our initial investment measured at amortized cost for fixed maturities, available-for-sale. Our risk of loss is limited to our investment measured at fair value for our fixed maturities, trading and equity securities. Our risk of loss is limited to our carrying value plus any unfunded commitments and/or guarantees and similar provisions for our other investments. A carrying value of zero is used if distributions have been received in excess of our investment, resulting in a negative carrying value for the investment. Unfunded commitments are not liabilities on our consolidated statements of financial position because we are only required to fund additional equity when called upon to do so by the general partner or investment manager . (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. (3) As of December 31, 2021 and December 31, 2020, the maximum exposure to loss for other limited partnership and fund interests includes $130.5 million and $141.2 million, respectively, of debt within certain of our managed international real estate funds that is fully secured by assets whose value exceeds the amount of the debt, but also includes recourse to the investment manager. Money Market Funds We are the investment manager for certain money market mutual funds. These types of funds are exempt from assessment under any consolidation model due to a scope exception for money market funds registered under Rule 2a-7 of the Investment Company Act of 1940 or similar funds. As of December 31, 2021 and December 31, 2020, money market mutual funds we manage held $4.8 billion and $4.4 billion in total assets, respectively. We have no contractual obligation to contribute to these funds; however, we provide support through the waiver of fees and through expense reimbursements. The amount of fees waived and expenses reimbursed was insignificant. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2021 | |
Investments | |
Investments | 4. Investments Fixed Maturities and Equity Securities The amortized cost, gross unrealized gains and losses, allowance for credit loss and fair value of fixed maturities, available-for-sale were as follows: Gross Gross Allowance Amortized unrealized unrealized for credit cost (1) gains losses loss Fair value (in millions) December 31, 2021 Fixed maturities, available-for-sale: U.S. government and agencies $ 1,978.0 $ 148.0 $ 37.4 $ — $ 2,088.6 Non-U.S. governments 851.0 133.1 2.1 — 982.0 States and political subdivisions 8,290.7 1,030.3 16.6 — 9,304.4 Corporate 42,139.2 4,044.8 224.5 15.1 45,944.4 Residential mortgage-backed pass-through securities 3,122.3 59.0 28.4 — 3,152.9 Commercial mortgage-backed securities 5,436.2 157.8 31.5 0.3 5,562.2 Collateralized debt obligations (2) 3,564.7 4.5 9.6 — 3,559.6 Other debt obligations 7,487.8 131.1 58.4 0.1 7,560.4 Total fixed maturities, available-for-sale $ 72,869.9 $ 5,708.6 $ 408.5 $ 15.5 $ 78,154.5 Gross Gross Allowance Amortized unrealized unrealized for credit cost (1) gains losses loss Fair value (in millions) December 31, 2020 Fixed maturities, available-for-sale: U.S. government and agencies $ 1,893.1 $ 228.9 $ 10.5 $ — $ 2,111.5 Non-U.S. governments 881.6 192.1 — — 1,073.7 States and political subdivisions 8,004.9 1,175.5 12.6 — 9,167.8 Corporate 41,289.9 6,160.9 95.1 0.9 47,354.8 Residential mortgage-backed pass-through securities 2,857.6 129.4 0.2 — 2,986.8 Commercial mortgage-backed securities 4,741.2 241.3 35.9 4.3 4,942.3 Collateralized debt obligations (2) 4,045.9 8.7 24.9 2.2 4,027.5 Other debt obligations 6,832.6 243.2 29.9 — 7,045.9 Total fixed maturities, available-for-sale $ 70,546.8 $ 8,380.0 $ 209.1 $ 7.4 $ 78,710.3 (1) Amortized cost excludes accrued interest receivable of $542.6 million and $552.5 million as of December 31, 2021 and December 31, 2020, respectively. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. The amortized cost and fair value of fixed maturities, available-for-sale as of December 31, 2021, by expected maturity, were as follows: Amortized cost Fair value (in millions) Due in one year or less $ 1,647.3 $ 1,666.8 Due after one year through five years 11,267.1 11,749.9 Due after five years through ten years 14,795.7 15,797.6 Due after ten years 25,548.8 29,105.1 Subtotal 53,258.9 58,319.4 Mortgage-backed and other asset-backed securities 19,611.0 19,835.1 Total $ 72,869.9 $ 78,154.5 Actual maturities may differ because borrowers may have the right to call or prepay obligations. Our portfolio is diversified by industry, issuer and asset class. Credit concentrations are managed to established limits. Net Investment Income Major components of net investment income were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Fixed maturities, available-for-sale $ 2,766.3 $ 2,660.5 $ 2,606.0 Fixed maturities, trading 19.3 18.7 23.8 Equity securities 57.7 62.8 110.5 Mortgage loans 790.2 724.7 707.0 Real estate 194.4 180.8 191.1 Policy loans 38.8 41.6 44.0 Cash and cash equivalents 4.3 17.4 65.3 Derivatives 28.2 (1.8) (2.0) Other 622.0 296.5 370.8 Total 4,521.2 4,001.2 4,116.5 Investment expenses (115.1) (110.6) (118.1) Net investment income $ 4,406.1 $ 3,890.6 $ 3,998.4 Net Realized Capital Gains and Losses Major components of net realized capital gains (losses) on investments were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Fixed maturities, available-for-sale: Gross gains $ 64.4 $ 134.2 $ 15.5 Gross losses (29.2) (48.5) (15.3) Net credit losses (1) (45.0) (22.9) (43.5) Hedging, net (9.5) (9.7) (9.3) Fixed maturities, trading (2) (33.3) 3.2 43.0 Equity securities (3) 100.0 70.5 84.5 Mortgage loans 6.5 (15.5) 3.0 Derivatives (116.9) 77.3 (120.3) Other 65.5 114.0 (10.4) Net realized capital gains (losses) $ 2.5 $ 302.6 $ (52.8) (1) Upon adoption of authoritative guidance effective January 1, 2020, net credit losses include adjustments to the credit loss valuation allowance, write-offs and recoveries on available-for-sale securities. Prior to 2020, net credit losses included net other-than-temporary impairment losses and recoveries on available-for-sale securities. (2) Unrealized gains (losses) on fixed maturities, trading still held at the reporting date were $(32.2) million, $5.3 million and $32.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. (3) Unrealized gains on equity securities still held at the reporting date were $58.6 million, $64.6 million and $61.6 million for the years ended December 31, 2021, 2020 and 2019, respectively. This excludes $28.7 million, $35.2 million and $66.9 million of unrealized gains on equity securities still held at the reporting date for the years ended December 31, 2021, 2020 and 2019, respectively, that were reported in net investment income. Proceeds from sales of investments (excluding call and maturity proceeds) in fixed maturities, available-for-sale were $2,110.9 million, $2,421.9 million and $1,654.8 million in 2021, 2020 and 2019, respectively. Allowance for Credit Loss We have a process in place to identify fixed maturity securities that could potentially require an allowance for credit loss. This process involves monitoring market events that could impact issuers’ credit ratings, business climate, management changes, litigation and government actions and other similar factors. This process also involves monitoring late payments, pricing levels, downgrades by rating agencies, key financial ratios, financial statements, revenue forecasts and cash flow projections as indicators of credit issues. Each reporting period, all securities in an unrealized loss position are reviewed to determine whether a decline in value is due to credit. Relevant facts and circumstances considered include: (1) the extent the fair value is below cost; (2) the reasons for the decline in value; (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events and (4) for structured securities, the adequacy of the expected cash flows. To the extent we determine an unrealized loss is due to credit, an allowance for credit loss is recognized through a reduction to net income. We estimate the amount of the allowance for credit loss as the difference between amortized cost and the present value of the expected cash flows of the security. The present value is determined using the best estimate cash flows discounted at the effective interest rate implicit to the security at the date of purchase or the current yield to accrete an asset-backed or floating rate security. The methodology and assumptions for establishing the best estimate cash flows vary depending on the type of security. The ABS cash flow estimates are based on security specific facts and circumstances that may include collateral characteristics, expectations of delinquency and default rates, loss severity and prepayment speeds and structural support, including subordination and guarantees. The corporate security cash flow estimates are derived from scenario-based outcomes of expected corporate restructurings or liquidations using bond specific facts and circumstances including timing, security interests and loss severity. We do not measure a credit loss allowance on accrued interest receivable because we write off the accrued interest receivable balance to net investment income in a timely manner when we have concern regarding collectability. Amounts on fixed maturities, available-for-sale deemed to be uncollectible are written off and removed from the allowance for credit loss. A write-off may also occur if we intend to sell a security or whether it is more likely than not we will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity. A rollforward of the allowance for credit loss by major security type was as follows. For the year ended December 31, 2021 Residential mortgage- backed Commercial Collateralized U.S. States and pass- mortgage- debt Other government Non-U.S. political through backed obligations debt and agencies governments subdivisions Corporate securities securities (1) obligations Total (in millions) Beginning balance $ — $ — $ — $ 0.9 $ — $ 4.3 $ 2.2 $ — $ 7.4 Additions for credit losses not previously recorded — — — 27.5 — 0.4 — 0.1 28.0 Reductions for securities sold during the period — — — (12.4) — — — — (12.4) Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period — — — — — 2.4 0.4 — 2.8 Write-offs charged against allowance — — — — — (6.8) (2.6) — (9.4) Foreign currency translation adjustment — — — (0.9) — — — — (0.9) Ending balance $ — $ — $ — $ 15.1 $ — $ 0.3 $ — $ 0.1 $ 15.5 Accrued interest written off to net investment income $ — $ — $ — $ 0.2 $ — $ — $ — $ — $ 0.2 For the year ended December 31, 2020 Residential mortgage- backed Commercial Collateralized U.S. States and pass- mortgage- debt Other government Non-U.S. political through backed obligations debt and agencies governments subdivisions Corporate securities securities (1) obligations Total (in millions) Beginning balance (2) $ — $ — $ — $ — $ — $ — $ — $ — $ — Additions for credit losses not previously recorded — — — 13.2 — 2.9 0.1 — 16.2 Reductions for securities sold during the period — — — (7.0) — — — — (7.0) Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period — — — (5.9) — 4.0 2.1 — 0.2 Write-offs charged against allowance — — — — — (2.6) — — (2.6) Foreign currency translation adjustment — — — 0.6 — — — — 0.6 Ending balance $ — $ — $ — $ 0.9 $ — $ 4.3 $ 2.2 $ — $ 7.4 (1) Primarily consists of collateralized loan obligations backed by secured corporate loans. (2) The allowance for credit loss associated with fixed maturities, available-for-sale was applied prospectively upon adoption of authoritative guidance effective January 1, 2020. We did not write off any accrued interest to net investment income during the year ended December 31, 2020. Other-Than-Temporary Impairments Prior to the implementation of authoritative guidance in 2020, we had a process in place to identify fixed maturity securities that could potentially have an impairment that is other than temporary. This process involved monitoring market events that could impact issuers’ credit ratings, business climate, management changes, litigation and government actions and other similar factors. This process also involved monitoring late payments, pricing levels, downgrades by rating agencies, key financial ratios, financial statements, revenue forecasts and cash flow projections as indicators of credit issues. Each reporting period, all securities were reviewed to determine whether an other-than-temporary decline in value existed and whether losses should be recognized. We considered relevant facts and circumstances in evaluating whether a credit or interest rate related impairment of a security was other than temporary. Relevant facts and circumstances considered include: (1) the extent and length of time the fair value was below cost; (2) the reasons for the decline in value; (3) the financial position and access to capital of the issuer, including the current and future impact of any specific events; (4) for structured securities, the adequacy of the expected cash flows and (5) our intent to sell a security or whether it is more likely than not we will be required to sell the security before the recovery of its amortized cost which, in some cases, may extend to maturity. To the extent we determined a security was deemed to be other than temporarily impaired, an impairment loss was recognized. The way in which impairment losses on fixed maturities were recognized in the financial statements was dependent on the facts and circumstances related to the specific security. If we intended to sell a security or it was more likely than not that we would be required to sell a security before the recovery of its amortized cost, we recognized an other-than-temporary impairment in net income for the difference between amortized cost and fair value. If we did not expect to recover the amortized cost basis, we did not plan to sell the security and if it was not more likely than not that we would be required to sell a security before the recovery of its amortized cost, the recognition of the other-than-temporary impairment was bifurcated. We recognized the credit loss portion in net income and the noncredit loss portion in OCI (“bifurcated OTTI”). Prior to 2020, net realized capital gains (losses) included total other-than-temporary impairment losses, net of recoveries from the sale of previously impaired securities, as follows: For the year ended December 31, 2019 (in millions) Net realized capital losses, excluding impairment losses on available-for-sale securities $ (9.3) Net other-than-temporary impairment losses on available-for-sale securities (38.3) Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified from other comprehensive income (1) (5.2) Net impairment losses on available-for-sale securities (43.5) Net realized capital losses $ (52.8) (1) Represents the net impact of (a) gains resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI and (b) losses resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold. We estimated the amount of the credit loss component of a fixed maturity security impairment as the difference between amortized cost and the present value of the expected cash flows of the security. The present value was determined using the best estimate cash flows discounted at the effective interest rate implicit to the security at the date of purchase or the current yield to accrete an asset-backed or floating rate security. The methodology and assumptions for establishing the best estimate cash flows varied depending on the type of security. The ABS cash flow estimates were based on security specific facts and circumstances that may include collateral characteristics, expectations of delinquency and default rates, loss severity and prepayment speeds and structural support, including subordination and guarantees. The corporate security cash flow estimates were derived from scenario-based outcomes of expected corporate restructurings or liquidations using bond specific facts and circumstances including timing, security interests and loss severity. The following table provides a rollforward of accumulated credit losses for fixed maturities with bifurcated credit losses prior to the implementation of new accounting guidance in 2020. The purpose of the table is to provide detail of (1) additions to the bifurcated credit loss amounts recognized in net realized capital gains (losses) during the period and (2) decrements for previously recognized bifurcated credit losses where the loss is no longer bifurcated and/or there has been a positive change in expected cash flows or accretion of the bifurcated credit loss amount. For the year ended December 31, 2019 (in millions) Beginning balance $ (117.5) Credit losses for which an other-than-temporary impairment was not previously recognized (6.8) Credit losses for which an other-than-temporary impairment was previously recognized (11.8) Reduction for credit losses previously recognized on fixed maturities now sold, paid down or intended to be sold 54.3 Net reduction for positive changes in cash flows expected to be collected and amortization (1) 0.8 Ending balance $ (81.0) (1) Amounts are recognized in net investment income. Available-for-Sale Securities in Unrealized Loss Positions Without an Allowance for Credit Loss For available-for-sale securities with unrealized losses for which an allowance for credit loss has not been recorded, the gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position were as follows: December 31, 2021 Less than Greater than or twelve months equal to twelve months Total Gross Gross Gross Fair unrealized Fair unrealized Fair unrealized value losses value losses value losses (in millions) Fixed maturities, available-for-sale(1): U.S. government and agencies $ 129.3 $ 3.4 $ 482.9 $ 34.0 $ 612.2 $ 37.4 Non-U.S. governments 57.8 2.0 — — 57.8 2.0 States and political subdivisions 690.2 10.5 102.3 6.1 792.5 16.6 Corporate 5,281.6 121.2 1,327.5 101.5 6,609.1 222.7 Residential mortgage-backed pass- through securities 1,562.6 22.2 194.9 6.3 1,757.5 28.5 Commercial mortgage-backed securities 1,297.4 15.6 299.6 15.7 1,597.0 31.3 Collateralized debt obligations (2) 1,592.5 2.8 424.4 6.7 2,016.9 9.5 Other debt obligations 3,949.9 49.4 211.0 9.0 4,160.9 58.4 Total fixed maturities, available-for-sale $ 14,561.3 $ 227.1 $ 3,042.6 $ 179.3 $ 17,603.9 $ 406.4 (1) Fair value and gross unrealized losses are excluded for available-for-sale securities for which an allowance for credit loss has been recorded. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. Of the total amounts, Principal Life Insurance Company’s (“Principal Life”) consolidated portfolio represented $15,792.6 million in available-for-sale fixed maturities with gross unrealized losses of $288.0 million. Of the available-for-sale fixed maturities within Principal Life’s consolidated portfolio in a gross unrealized loss position, 91% were investment grade (rated AAA through BBB-) with an average price of 98 (carrying value/amortized cost) as of December 31, 2021. Gross unrealized losses in our fixed maturities portfolio increased during the year ended December 31, 2021, primarily due to an increase in interest rates, partially offset by tightening of credit spreads. For those securities that had been in a continuous unrealized loss position for less than twelve months, Principal Life’s consolidated portfolio held 1,805 securities with a carrying value of $13,052.3 million and unrealized losses of $150.9 million reflecting an average price of 99 as of December 31, 2021. Of this portfolio, 90% was investment grade (rated AAA through BBB-) as of December 31, 2021, with associated unrealized losses of $138.9 million. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired. For those securities that had been in a continuous unrealized loss position greater than or equal to twelve months, Principal Life’s consolidated portfolio held 459 securities with a carrying value of $2,740.3 million and unrealized losses of $137.1 million as of December 31, 2021. The average credit rating of this portfolio was A+ with an average price of 95 as of December 31, 2021. Of the $137.1 million in unrealized losses, the corporate sector accounts for $67.1 million in unrealized losses with an average price of 95 and an average credit rating of BBB+. Furthermore, unrealized losses include $15.3 million within the commercial mortgage-backed security sector with an average of price of 95 and an average credit rating of AAA and $6.7 million within the collateralized debt obligation sector with an average price of 98 and an average credit rating of AA+. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired. Because we expected to recover our amortized cost, we did not record an allowance for credit loss on these securities as of December 31, 2021. Because it was not our intent to sell the fixed maturity available-for-sale securities with unrealized losses and it was not more likely than not that we would be required to sell these securities before recovery of the amortized cost, which may be at maturity, we did not write down these investments to fair value. December 31, 2020 Less than Greater than or twelve months equal to twelve months Total Gross Gross Gross Fair unrealized Fair unrealized Fair unrealized value losses value losses value losses (in millions) Fixed maturities, available-for-sale (1): U.S. government and agencies $ 351.1 $ 10.4 $ — $ — $ 351.1 $ 10.4 States and political subdivisions 363.5 12.5 — — 363.5 12.5 Corporate 1,578.7 54.4 267.9 40.6 1,846.6 95.0 Residential mortgage-backed pass- through securities 92.3 0.2 1.6 — 93.9 0.2 Commercial mortgage-backed securities 970.9 22.1 137.4 12.2 1,108.3 34.3 Collateralized debt obligations (2) 1,750.6 11.1 931.1 12.9 2,681.7 24.0 Other debt obligations 802.3 28.1 61.1 1.7 863.4 29.8 Total fixed maturities, available-for-sale $ 5,909.4 $ 138.8 $ 1,399.1 $ 67.4 $ 7,308.5 $ 206.2 (1) Fair value and gross unrealized losses are excluded for available-for-sale securities for which an allowance for credit loss has been recorded. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. Of the total amounts, Principal Life’s consolidated portfolio represented $7,029.6 million in available-for-sale fixed maturities with gross unrealized losses of $173.9 million. Of the available-for-sale fixed maturities within Principal Life’s consolidated portfolio in a gross unrealized loss position, 89% were investment grade (rated AAA through BBB-) with an average price of 98 (carrying value/amortized cost) as of December 31, 2020. Gross unrealized losses in our fixed maturities portfolio increased during the year ended December 31, 2020, primarily due to widening of credit spreads, partially offset by a decrease in interest rates. For those securities that had been in a continuous unrealized loss position for less than twelve months, Principal Life’s consolidated portfolio held 619 securities with a carrying value of $5,638.3 million and unrealized losses of $122.4 million reflecting an average price of 98 as of December 31, 2020. Of this portfolio, 89% was investment grade (rated AAA through BBB-) as of December 31, 2020, with associated unrealized losses of $98.4 million. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired. For those securities that had been in a continuous unrealized loss position greater than or equal to twelve months, Principal Life’s consolidated portfolio held 198 securities with a carrying value of $1,391.3 million and unrealized losses of $51.5 million as of December 31, 2020. The average credit rating of this portfolio was AA- with an average price of 96 as of December 31, 2020. Of the $51.5 million in unrealized losses, the corporate sector accounts for $24.9 million in unrealized losses with an average price of 92 and an average credit rating of BB+. Furthermore, unrealized losses include $12.9 million within the collateralized debt obligation sector with an average price of 99 and an average credit rating of AA+ and $11.9 million within commercial mortgage-backed security sector with an average of price of 92 and an average credit rating of AA+. The unrealized losses on these securities can primarily be attributed to changes in market interest rates and changes in credit spreads since the securities were acquired. Because we expected to recover our amortized cost, we did not record an allowance for credit loss on these securities as of December 31, 2020. Because it was not our intent to sell the fixed maturity available-for-sale securities with unrealized losses and it was not more likely than not that we would be required to sell these securities before recovery of the amortized cost, which may be at maturity, we did not write down these investments to fair value. Net Unrealized Gains and Losses on Available-for-Sale Securities and Derivative Instruments The net unrealized gains and losses on investments in available-for-sale securities and the net unrealized gains and losses on derivative instruments in cash flow hedge relationships are reported as separate components of stockholders’ equity. The cumulative amount of net unrealized gains and losses on available-for-sale securities and derivative instruments in cash flow hedge relationships net of adjustments related to DAC and related actuarial balances, policyholder liabilities, noncontrolling interest and applicable income taxes was as follows: December 31, 2021 December 31, 2020 (in millions) Net unrealized gains on fixed maturities, available-for-sale (1) $ 5,289.9 $ 8,193.0 Net unrealized gains on derivative instruments 80.1 38.9 Adjustments for assumed changes in amortization patterns (266.1) (437.3) Adjustments for assumed changes in policyholder liabilities (689.2) (2,603.9) Net unrealized gains on other investments and noncontrolling interest adjustments 40.5 78.0 Provision for deferred income taxes (936.0) (1,112.2) Net unrealized gains on available-for-sale securities and derivative instruments $ 3,519.2 $ 4,156.5 (1) Excludes net unrealized gains (losses) on fixed maturities, available-for-sale included in fair value hedging relationships. Financing Receivables Mortgage Loans Mortgage loans consist of commercial and residential mortgage loans. Our commercial mortgage loan portfolio consists primarily of non-recourse, fixed rate mortgages on stabilized properties. Our residential mortgage loan portfolio is composed of first lien and home equity mortgages concentrated in Chile and the United States. Commercial and residential mortgage loans are generally reported at cost adjusted for amortization of premiums and accrual of discounts, computed using the interest method and net of valuation allowances. Amortized cost excludes accrued interest receivable. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Interest income, as well as prepayment of fees and the amortization of the related premium or discount, is reported in net investment income on the consolidated statements of operations. Accrued interest receivable is reported in accrued investment income on the consolidated statements of financial position. Any changes in the loan valuation allowances are reported in net realized capital gains (losses) on the consolidated statements of operations. Further details relating to our valuation allowance are included under the caption “Financing Receivables Valuation Allowance.” Direct Financing Leases Our direct financing leases are concentrated in Chile. Our Chilean operations enter into private placement contracts for commercial, industrial and office space properties whereby our Chilean operations purchase the real estate and/or building from the seller-lessee but then lease the property back to the seller-lessee. Ownership of the property is transferred to the lessee by the end of the lease term. Direct financing leases are reported as a component of other investments in the consolidated statements of financial position. Reinsurance Recoverables Our reinsurance recoverables include amounts due from reinsurers for paid or unpaid claims, claims incurred but not reported or policy benefits. We cede life, disability, medical and long-term care insurance to other insurance companies through reinsurance. Reinsurance recoverables are reported with premiums due and other receivables in the consolidated statements of financial position. Credit Quality Information for Financing Receivables The amortized cost of our financing receivables by credit risk and vintage was as follows: As of December 31, 2021 2021 2020 2019 2018 2017 Prior Total (in millions) Commercial mortgage loans: A- and above $ 2,275.9 $ 1,722.7 $ 2,412.9 $ 2,383.3 $ 1,437.2 $ 4,334.2 $ 14,566.2 BBB+ thru BBB- 278.6 305.6 294.0 131.4 302.1 380.0 1,691.7 BB+ thru BB- 32.8 5.3 — — — 55.4 93.5 B+ and below — — — 8.8 — 34.5 43.3 Total $ 2,587.3 $ 2,033.6 $ 2,706.9 $ 2,523.5 $ 1,739.3 $ 4,804.1 $ 16,394.7 Direct financing leases: A- and above $ 11.7 $ 41.8 $ 1.4 $ 39.4 $ 16.6 $ 235.6 $ 346.5 BBB+ thru BBB- 30.2 57.9 22.0 17.9 15.5 50.2 193.7 BB+ thru BB- 50.8 13.4 1.9 — — 2.1 68.2 B+ and below 1.5 — — — — — 1.5 Total $ 94.2 $ 113.1 $ 25.3 $ 57.3 $ 32.1 $ 287.9 $ 609.9 Residential mortgage loans: Performing $ 2,039.1 $ 510.1 $ 155.6 $ 91.2 $ 102.4 $ 415.6 $ 3,314.0 Non-performing — 1.8 0.6 — 0.8 2.7 5.9 Total $ 2,039.1 $ 511.9 $ 156.2 $ 91.2 $ 103.2 $ 418.3 $ 3,319.9 Reinsurance recoverables $ 1,189.3 As of December 31, 2020 2020 2019 2018 2017 2016 Prior Total (in millions) Commercial mortgage loans: A- and above $ 1,807.6 $ 2,486.8 $ 2,464.7 $ 1,780.8 $ 1,417.8 $ 3,697.0 $ 13,654.7 BBB+ thru BBB- 149.1 194.1 352.5 262.7 75.8 499.7 1,533.9 BB+ thru BB- 23.7 69.0 — — 9.1 43.9 145.7 B+ and below 39.4 20.0 — 5.8 6.6 35.5 107.3 Total $ 2,019.8 |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | 5. Derivative Financial Instruments Derivatives are generally used to hedge or reduce exposure to market risks associated with assets held or expected to be purchased or sold and liabilities incurred or expected to be incurred. Derivatives are used to change the characteristics of our asset/liability mix consistent with our risk management activities. Derivatives are also used in asset replication strategies. Types of Derivative Instruments Interest Rate Contracts Interest rate risk is the risk we will incur economic losses due to adverse changes in interest rates. Sources of interest rate risk include the difference between the maturity and interest rate changes of assets with the liabilities they support, timing differences between the pricing of liabilities and the purchase or procurement of assets and changing cash flow profiles from original projections due to prepayment options embedded within asset and liability contracts. We use various derivatives to manage our exposure to fluctuations in interest rates. Interest rate swaps are contracts in which we agree with other parties to exchange, at specified intervals, the difference between fixed rate and/or floating rate interest amounts based upon designated market rates or rate indices and an agreed upon notional principal amount. Generally, no cash is exchanged at the outset of the contract and no principal payments are made by any party. Cash is paid or received based on the terms of the swap. We use interest rate swaps primarily to more closely match the interest rate characteristics of assets and liabilities and to mitigate the risks arising from timing mismatches between assets and liabilities (including duration mismatches). We also use interest rate swaps to hedge against changes in the value of assets we anticipate acquiring and other anticipated transactions and commitments. Interest rate swaps are used to hedge against changes in the value of the guaranteed minimum withdrawal benefit (“GMWB”) liability. The GMWB rider on our variable annuity products provides for guaranteed minimum withdrawal benefits regardless of the actual performance of various equity and/or fixed income funds available with the product. Interest rate options, including interest rate caps and interest rate floors, which can be combined to form interest rate collars, are contracts that entitle the purchaser to pay or receive the amounts, if any, by which a specified market rate exceeds a cap strike interest rate, or falls below a floor strike interest rate, respectively, at specified dates. We use interest rate options to manage prepayment risks in our assets and minimum guaranteed interest rates and lapse risks in our liabilities. A swaption is an option to enter into an interest rate swap at a future date. We have purchased swaptions to hedge interest rate exposure for certain assets and liabilities. Swaptions not only hedge against the downside risk, but also allow us to take advantage of any upside benefits. In exchange-traded futures transactions, we agree to purchase or sell a specified number of contracts, the values of which are determined by the values of designated classes of securities, and to post variation margin on a daily basis in an amount equal to the difference in the daily market values of those contracts. We enter into exchange-traded futures with regulated futures commissions merchants who are members of a trading exchange. We use exchange-traded futures to hedge against changes in value of the GMWB liability. Interest rate forwards, including to be announced (“TBA”) forwards and treasury forwards, are contracts to take delivery of a fixed income security at a specified price at a future date. TBA forwards deliver government guaranteed mortgage-backed securities and treasury forwards deliver U.S. Treasury bonds. At inception of these forward contracts we do not intend to take physical delivery. We have used TBA forwards to gain exposure to the investment risk and return of agency mortgage-backed security pools in order to reduce asset and liability duration mismatch. Treasury forwards are used to hedge against changes in the value of the GMWB liability. Foreign Exchange Contracts Foreign currency risk is the risk we will incur economic losses due to adverse fluctuations in foreign currency exchange rates. This risk arises from foreign currency-denominated funding agreements issued to nonqualified institutional investors in the international market, foreign currency-denominated fixed maturity and equity securities, and our international operations, including expected cash flows and potential acquisition and divestiture activity. We use various derivatives to manage our exposure to fluctuations in foreign currency exchange rates. Currency swaps are contracts in which we agree with other parties to exchange, at specified intervals, a series of principal and interest payments in one currency for that of another currency. Generally, the principal amount of each currency is exchanged at the beginning and termination of the currency swap by each party. The interest payments are primarily fixed-to-fixed rate; however, they may also be fixed-to-floating rate or floating-to-fixed rate. These transactions are entered into pursuant to master agreements that provide for a single net payment to be made by one counterparty for payments made in the same currency at each due date. We use currency swaps to reduce market risks from changes in currency exchange rates with respect to investments or liabilities denominated in foreign currencies that we either hold or intend to acquire or sell. Currency forwards are contracts in which we agree with other parties to deliver or receive a specified amount of an identified currency at a specified future date. Typically, the price is agreed upon at the time of the contract and payment for such a contract is made at the specified future date. We use currency forwards to reduce market risks from changes in currency exchange rates with respect to investments or liabilities denominated in foreign currencies that we either hold or intend to acquire or sell. We use currency forwards to hedge certain foreign-denominated real estate funds in our domestic operations and net equity investments in foreign operations, including certain sponsored investment funds. Currency options are contracts that give the holder the right, but not the obligation to buy or sell a specified amount of the identified currency within a limited period of time at a contracted price. The contracts are net settled in cash, based on the differential in the current foreign exchange rate and the strike price. Purchased and sold options can be combined to form a foreign currency collar where we receive a payment if the foreign exchange rate is below the purchased option strike price and make a payment if the foreign exchange rate is above the sold option strike price. We have used currency options to hedge expected cash flows from our foreign operations. Equity Contracts Equity risk is the risk that we will incur economic losses due to adverse fluctuations in common stock prices. We use various derivatives to manage our exposure to equity risk, which arises from products in which the return or interest we credit is tied to an external equity index as well as products subject to minimum contractual guarantees. We purchase equity call spreads (“option collars”) to hedge the equity participation rates promised to contractholders in conjunction with our fixed deferred annuity and universal life products that credit interest based on changes in an external equity index. We use exchange-traded futures and equity put options to hedge against changes in the value of the GMWB liability related to the GMWB rider on our variable annuity product. The premium associated with certain options is paid quarterly over the life of the option contract. We use exchange-traded futures to hedge against changes in value of the GMWB liability. Credit Contracts Credit risk relates to the uncertainty associated with the continued ability of a given obligor to make timely payments of principal and interest. We use credit default swaps to enhance the return on our investment portfolio by providing comparable exposure to fixed income securities that might not be available in the primary market. They are also used to hedge credit exposures in our investment portfolio. Credit derivatives are used to sell or buy credit protection on an identified name or names on an unfunded or synthetic basis in return for receiving or paying a quarterly premium. The premium generally corresponds to a referenced name’s credit spread at the time the agreement is executed. In cases where we sell protection, we also buy a quality cash bond to match against the credit default swap, thereby entering into a synthetic transaction replicating a cash security. When selling protection, if there is an event of default by the referenced name, as defined by the agreement, we are obligated to pay the counterparty the referenced amount of the contract and receive in return the referenced security in a principal amount equal to the notional value of the credit default swap. Other Contracts Embedded Derivatives. We offer group annuity contracts that have guaranteed separate accounts as an investment option. We also offer funds with embedded fixed rate guarantees as investment options in our defined contribution plans in Hong Kong. We have fixed deferred annuities and universal life products that credit interest based on changes in an external equity index. We also have certain variable annuity products with a GMWB rider, which allows the customer to make withdrawals of a specified annual amount, either for a fixed number of years or for the lifetime of the customer, even if the account value is fully exhausted. Declines in the equity markets may increase our exposure to benefits under contracts with the GMWB. We economically hedge the exposure in these contracts, as previously explained. Exposure Our risk of loss is typically limited to the fair value of our derivative instruments and not to the notional or contractual amounts of these derivatives. We are also exposed to credit losses in the event of nonperformance of the counterparties. Our current credit exposure is limited to the value of derivatives that have become favorable to us. This credit risk is minimized by purchasing such agreements from financial institutions with high credit ratings and by establishing and monitoring exposure limits. We also utilize various credit enhancements, including collateral and credit triggers to reduce the credit exposure to our derivative instruments. Derivatives may be exchange-traded or they may be privately negotiated contracts, which are usually referred to as over-the-counter (“OTC”) derivatives. Certain of our OTC derivatives are cleared and settled through central clearing counterparties (“OTC cleared”), while others are bilateral contracts between two counterparties (“bilateral OTC”). Our derivative transactions are generally documented under International Swaps and Derivatives Association, Inc. (“ISDA”) Master Agreements. Management believes that such agreements provide for legally enforceable set-off and close-out netting of exposures to specific counterparties. Under such agreements, in connection with an early termination of a transaction, we are permitted to set off our receivable from a counterparty against our payables to the same counterparty arising out of all included transactions. For reporting purposes, we do not offset fair value amounts of bilateral OTC derivatives for the right to reclaim cash collateral or the obligation to return cash collateral against fair value amounts recognized for derivative instruments executed with the same counterparties under master netting agreements. OTC cleared derivatives have variation margin that is legally characterized as settlement of the derivative exposure, which reduces their fair value in the consolidated statements of financial position. We posted $240.8 million and $148.3 million in cash and securities under collateral arrangements as of December 31, 2021 and December 31, 2020, respectively, to satisfy collateral and initial margin requirements associated with our derivative credit support agreements and FCM agreements. Certain of our derivative instruments contain provisions that require us to maintain an investment grade rating from each of the major credit rating agencies on our debt. If the ratings on our debt were to fall below investment grade, it would be in violation of these provisions and the counterparties to the derivative instruments could request immediate payment or demand immediate and ongoing full overnight collateralization on derivative instruments in net liability positions. The aggregate fair value, inclusive of accrued interest, of all derivative instruments with credit-risk-related contingent features that were in a liability position without regard to netting under derivative credit support annex agreements as of December 31, 2021 and December 31, 2020, was $146.3 million and $180.2 million, respectively. Cleared derivatives have contingent features that require us to post excess margin as required by the FCM. The terms surrounding excess margin vary by FCM agreement. With respect to derivatives containing collateral provisions, we posted collateral and initial margin of $240.8 million and $148.3 million as of December 31, 2021 and December 31, 2020, respectively, in the normal course of business, which reflects netting under derivative agreements. If the credit-risk-related contingent features underlying these agreements were triggered on December 31, 2021, we would be required to post an additional $48.6 million of collateral to our counterparties. As of December 31, 2021 and December 31, 2020, we had received $214.9 million and $225.2 million, respectively, of cash collateral associated with our derivative credit support annex agreements and FCM agreements, for which we recorded a corresponding liability reflecting our obligation to return the collateral. Notional amounts are used to express the extent of our involvement in derivative transactions and represent a standard measurement of the volume of our derivative activity. Notional amounts represent those amounts used to calculate contractual flows to be exchanged and are not paid or received, except for contracts such as currency swaps. Credit exposure represents the gross amount owed to us under derivative contracts as of the valuation date. The notional amounts and credit exposure of our derivative financial instruments by type were as follows: December 31, 2021 December 31, 2020 (in millions) Notional amounts of derivative instruments Interest rate contracts: Interest rate swaps $ 47,927.4 $ 44,472.1 Interest rate options 2,373.9 2,083.9 Interest rate forwards 2,181.6 1,000.0 Interest rate futures 1,774.5 188.5 Swaptions — 62.0 Foreign exchange contracts: Currency swaps 1,242.7 1,045.5 Currency forwards 1,043.6 1,115.8 Equity contracts: Equity options 2,378.2 1,857.8 Equity futures 150.4 218.1 Credit contracts: Credit default swaps 295.0 295.0 Other contracts: Embedded derivatives 10,060.8 9,953.8 Total notional amounts at end of period $ 69,428.1 $ 62,292.5 Credit exposure of derivative instruments Interest rate contracts: Interest rate swaps $ 205.9 $ 291.0 Interest rate options 24.5 51.0 Interest rate forwards 15.3 6.2 Foreign exchange contracts: Currency swaps 51.1 43.3 Currency forwards 11.3 45.4 Equity contracts: Equity options 37.3 33.2 Credit contracts: Credit default swaps 2.7 3.4 Total gross credit exposure 348.1 473.5 Less: collateral received 244.6 294.7 Net credit exposure $ 103.5 $ 178.8 The fair value of our derivative instruments classified as assets and liabilities was as follows: Derivative assets (1) Derivative liabilities (2) December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 (in millions) Derivatives designated as hedging instruments Interest rate contracts $ 4.1 $ — $ 19.0 $ 27.8 Foreign exchange contracts 48.4 21.1 17.6 44.7 Total derivatives designated as hedging instruments $ 52.5 $ 21.1 $ 36.6 $ 72.5 Derivatives not designated as hedging instruments Interest rate contracts $ 233.4 $ 339.3 $ 13.0 $ 33.0 Foreign exchange contracts 11.3 66.5 83.3 29.2 Equity contracts 37.3 33.2 90.9 49.0 Credit contracts 2.6 3.4 2.2 2.5 Other contracts — — 356.3 467.8 Total derivatives not designated as hedging instruments 284.6 442.4 545.7 581.5 Total derivative instruments $ 337.1 $ 463.5 $ 582.3 $ 654.0 (1) The fair value of derivative assets is reported with other investments on the consolidated statements of financial position. (2) The fair value of derivative liabilities is reported with other liabilities on the consolidated statements of financial position, with the exception of certain embedded derivative liabilities. Embedded derivatives with a net liability fair value of $356.3 million and $467.8 million as of December 31, 2021 and December 31, 2020, respectively, are reported with contractholder funds on the consolidated statements of financial position. Credit Derivatives Sold When we sell credit protection, we are exposed to the underlying credit risk similar to purchasing a fixed maturity security instrument. Our credit derivative contracts sold reference a single name or reference security (referred to as “single name credit default swaps”). These instruments are either referenced in an OTC credit derivative transaction or embedded within an investment structure that has been fully consolidated into our financial statements. These credit derivative transactions are subject to events of default defined within the terms of the contract, which normally consist of bankruptcy, failure to pay, or modified restructuring of the reference entity and/or issue. If a default event occurs for a reference name or security, we are obligated to pay the counterparty an amount equal to the notional amount of the credit derivative transaction. As a result, our maximum future payment is equal to the notional amount of the credit derivative. In certain cases, we also may have purchased credit protection with identical underlyings to certain of our sold protection transactions. As of December 31, 2021 and December 31, 2020, we did not purchase credit protection relating to our sold protection transactions. In certain circumstances, our potential loss could also be reduced by any amount recovered in the default proceedings of the underlying credit name. The following tables show our credit default swap protection sold by types of contract, types of referenced/underlying asset class and external agency rating for the underlying reference security. The maximum future payments are undiscounted and have not been reduced by the effect of any offsetting transactions, collateral or recourse features described above. December 31, 2021 Weighted Maximum average Notional Fair future expected life amount value payments (in years) (in millions) Single name credit default swaps Corporate debt A $ 20.0 $ 0.4 $ 20.0 3.5 BBB 110.0 1.7 110.0 3.0 Sovereign A 20.0 0.5 20.0 3.5 Total credit default swap protection sold $ 150.0 $ 2.6 $ 150.0 3.1 December 31, 2020 Weighted Maximum average Notional Fair future expected life amount value payments (in years) (in millions) Single name credit default swaps Corporate debt A $ 20.0 $ 0.5 $ 20.0 4.5 BBB 115.0 2.1 115.0 3.9 Sovereign A 20.0 0.6 20.0 4.5 BBB 15.0 0.1 15.0 1.0 Total credit default swap protection sold $ 170.0 $ 3.3 $ 170.0 3.8 Fair Value and Cash Flow Hedges Fair Value Hedges We use fixed-to-floating rate interest rate swaps to more closely align the interest rate characteristics of certain assets and have used them to align the interest rate characteristics of certain liabilities. In general, these swaps are used in asset and liability management to modify duration, which is a measure of sensitivity to interest rate changes. The net interest effect of interest rate swap transactions for derivatives in fair value hedges is recorded as an adjustment to income or expense of the underlying hedged item in our consolidated statements of operations. The following amounts were recorded on the consolidated statements of financial position related to cumulative basis adjustments for fair value hedges. The amortized cost includes the amortized cost basis and the fair value hedging basis adjustment. Cumulative amount of fair value hedging basis adjustment Line item in the consolidated statements increase/(decrease) included in the of financial position in which the Amortized cost of hedged item amortized cost of the hedged item hedged item is included December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 (in millions) Fixed maturities, available-for-sale (1): Active hedging relationships $ 1,859.9 $ 476.1 $ (7.1) $ 21.4 Discontinued hedging relationships 79.7 135.1 2.8 5.2 Total fixed maturities, available-for-sale in active or discontinued hedging relationships $ 1,939.6 $ 611.2 $ (4.3) $ 26.6 (1) These amounts include the amortized cost basis of closed portfolios used to designate last-of-layer hedging relationships in which the hedged last layer amount is expected to remain at the end of the hedging relationship. As of December 31, 2021 and December 31, 2020, the amortized cost basis of the closed portfolios used in these hedging relationships was $1,390.4 million and $0.0 million, respectively, the cumulative basis adjustments associated with these hedging relationships was $(3.9) million and $0.0 million, respectively, and the amount of the designated hedged items were $510.0 million and $0.0 million, respectively. Cash Flow Hedges We utilized floating-to-fixed rate interest rate swaps to eliminate the variability in cash flows of recognized financial assets and liabilities and forecasted transactions. We enter into currency exchange swap agreements to convert both principal and interest payments of certain foreign denominated assets and liabilities into U.S. dollar denominated fixed rate instruments to eliminate the exposure to future currency volatility on those items. The net interest effect of interest rate swap and currency swap transactions for derivatives in cash flow hedges is recorded as an adjustment to income or expense of the underlying hedged item in our consolidated statements of operations. The following table shows the effect of derivatives in cash flow hedging relationships on the consolidated statements of financial position. Amount of gain (loss) recognized in AOCI on derivatives Derivatives in cash flow for the year ended December 31, hedging relationships Related hedged item 2021 2020 2019 (in millions) Interest rate contracts Fixed maturities, available-for-sale $ — $ (3.0) $ (9.9) Interest rate contracts Investment contracts 4.1 — — Foreign exchange contracts Fixed maturities, available-for-sale 53.4 (37.1) (9.4) Total $ 57.5 $ (40.1) $ (19.3) We expect to reclassify net gains of $21.7 million from AOCI into net income in the next 12 months, which includes both net deferred gains on discontinued hedges and net gains on periodic settlements of active hedges. Actual amounts may vary from this amount as a result of market conditions. Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations The following tables show the effect of derivatives in fair value and cash flow hedging relationships and the related hedged items on the consolidated statements of operations. For the year ended December 31, 2021 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 4,406.1 $ 2.5 $ 7,097.0 $ 4,987.3 Losses on fair value hedging relationships: Interest rate contracts: Loss recognized on hedged item $ (28.7) $ — $ — $ — Gain recognized on derivatives 28.6 — — — Amortization of hedged item basis adjustments (1.8) — — — Amounts related to periodic settlements on derivatives (10.0) — — — Total loss recognized for fair value hedging relationships $ (11.9) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 15.4 $ — $ (0.1) $ — Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 1.0 — — Amounts related to periodic settlements on derivatives — — (0.4) — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 9.2 — — Amounts related to periodic settlements on derivatives 9.6 — — — Total gain (loss) recognized for cash flow hedging relationships $ 25.0 $ 10.2 $ (0.5) $ — For the year ended December 31, 2020 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 3,890.6 $ 302.6 $ 8,281.5 $ 4,646.5 Losses on fair value hedging relationships: Interest rate contracts: Gain recognized on hedged item $ 3.3 $ — $ — $ — Loss recognized on derivatives (3.8) — — — Amortization of hedged item basis adjustments (2.5) — — — Amounts related to periodic settlements on derivatives (6.2) — — — Total loss recognized for fair value hedging relationships $ (9.2) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 18.1 $ 2.7 $ (0.1) $ — Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 0.1 — — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 6.3 — — Amounts related to periodic settlements on derivatives 8.2 — — — Total gain (loss) recognized for cash flow hedging relationships $ 26.3 $ 9.1 $ (0.1) $ — For the year ended December 31, 2019 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges (losses) related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 3,998.4 $ (52.8) $ 9,905.8 $ 4,503.9 Losses on fair value hedging relationships: Interest rate contracts: Gain recognized on hedged item $ 5.7 $ — $ — $ — Loss recognized on derivatives (6.0) — — — Amortization of hedged item basis adjustments (4.2) — — — Amounts related to periodic settlements on derivatives (3.4) — — — Total loss recognized for fair value hedging relationships $ (7.9) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 19.8 $ (0.6) $ (0.1) $ (4.8) Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 0.1 — — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 9.5 — — Amounts related to periodic settlements on derivatives 7.4 — — — Total gain (loss) recognized for cash flow hedging relationships $ 27.2 $ 9.0 $ (0.1) $ (4.8) Net Investment Hedges We may take measures to hedge our net equity investments in our foreign operations from currency risk. This is accomplished with the use of currency forwards. Gains and losses associated with net investment hedges are recorded in AOCI and will be released into net income if our investment in the foreign operation is sold or substantially liquidated. The following table shows the effect of foreign exchange contracts used to hedge a portion of our net investment in certain sponsored investment funds on the consolidated financial statements. Amount of gain recognized in AOCI on derivatives for the year ended December 31, Derivatives in net investment hedging relationships 2021 2020 2019 (in millions) Foreign exchange contracts $ 2.9 $ 7.9 $ — Total $ 2.9 $ 7.9 $ — Amount of gain reclassified from AOCI into net realized capital gains (losses) for the year ended December 31, Derivatives in net investment hedging relationships 2021 2020 2019 (in millions) Foreign exchange contracts $ — $ (7.1) $ — Total $ — $ (7.1) $ — Derivatives Not Designated as Hedging Instruments Our use of futures, certain swaptions and swaps, option collars, options and forwards are effective from an economic standpoint, but they have not been designated as hedges for financial reporting purposes. As such, periodic changes in the market value of these instruments, which includes mark-to-market gains and losses as well as periodic and final settlements, primarily flow directly into net realized capital gains (losses) on the consolidated statements of operations. The following table shows the effect of derivatives not designated as hedging instruments, including fair value changes of embedded derivatives that have been bifurcated from the host contract, on the consolidated statements of operations. Amount of gain (loss) recognized in net income on derivatives for the year ended December 31, Derivatives not designated as hedging instruments 2021 2020 2019 (in millions) Interest rate contracts $ (46.6) $ 346.5 $ 218.0 Foreign exchange contracts (121.9) 54.7 (58.6) Equity contracts (81.5) (96.6) (132.9) Credit contracts 0.1 1.8 (3.6) Other contracts 103.7 (255. |
Closed Block
Closed Block | 12 Months Ended |
Dec. 31, 2021 | |
Closed Block | |
Closed Block | 6. Closed Block In connection with the 1998 MIHC formation, Principal Life formed a Closed Block to provide reasonable assurance to policyholders included therein that, after the formation of the MIHC, assets would be available to maintain dividends in aggregate in accordance with the 1997 policy dividend scales, if the experience underlying such scales continued. Assets of Principal Life were allocated to the Closed Block in an amount that produces cash flows which, together with anticipated revenue from policies and contracts included in the Closed Block, were expected to be sufficient to support the Closed Block policies. This includes, but is not limited to, provisions for payment of claims, certain expenses, charges and taxes, and to provide for continuation of policy and contract dividends in aggregate in accordance with the 1997 dividend scales, if the experience underlying such scales continues, and to allow for appropriate adjustments in such scales, if such experience changes. Due to adjustable life policies being included in the Closed Block, the Closed Block is charged with amounts necessary to properly fund for certain adjustments, such as face amount and premium increases, that are made to these policies after the Closed Block inception date. These amounts are referred to as Funding Adjustment Charges and are treated as capital transfers from the Closed Block. Assets allocated to the Closed Block inure solely to the benefit of the holders of policies included in the Closed Block. Closed Block assets and liabilities are carried on the same basis as other similar assets and liabilities. Principal Life will continue to pay guaranteed benefits under all policies, including the policies within the Closed Block, in accordance with their terms. If the assets allocated to the Closed Block, the investment cash flows from those assets and the revenues from the policies included in the Closed Block, including investment income thereon, prove to be insufficient to pay the benefits guaranteed under the policies included in the Closed Block, Principal Life will be required to make such payments from its general funds. No additional policies were added to the Closed Block, nor was the Closed Block affected in any other way, as a result of the demutualization. A policyholder dividend obligation (“PDO”) is required to be established for higher than expected earnings in the Closed Block that will need to be paid as dividends unless future performance of the Closed Block is less favorable than originally expected. A model of the Closed Block was established to produce the pattern of expected earnings, assets and liabilities in the Closed Block. These projections are utilized to determine ratios that will allow us to compare actual cumulative earnings to expected cumulative earnings and determine the amount of the PDO. As of December 31, 2021 and 2020, the PDO was $210.7 million and $298.2 million, respectively. Closed Block liabilities and assets designated to the Closed Block were as follows: December 31, 2021 December 31, 2020 (in millions) Closed Block liabilities Future policy benefits and claims $ 3,286.0 $ 3,423.2 Other policyholder funds 5.3 6.0 Policyholder dividends payable 176.6 189.0 Policyholder dividends obligation 210.7 298.2 Other liabilities 8.8 8.7 Total Closed Block liabilities 3,687.4 3,925.1 Assets designated to the Closed Block Fixed maturities, available-for-sale 2,191.6 2,353.3 Fixed maturities, trading 2.4 2.6 Equity securities 1.0 1.1 Mortgage loans 554.9 565.9 Policy loans 425.2 456.8 Other investments 48.4 61.7 Total investments 3,223.5 3,441.4 Cash and cash equivalents 19.7 23.2 Accrued investment income 32.6 35.4 Premiums due and other receivables 8.4 8.3 Deferred tax asset 24.6 24.2 Total assets designated to the Closed Block 3,308.8 3,532.5 Excess of Closed Block liabilities over assets designated to the Closed Block 378.6 392.6 Amounts included in accumulated other comprehensive income 0.6 0.9 Maximum future earnings to be recognized from Closed Block assets and liabilities $ 379.2 $ 393.5 Closed Block revenues and expenses were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Revenues Premiums and other considerations $ 196.1 $ 217.6 $ 227.6 Net investment income 137.6 143.6 154.4 Net realized capital gains (losses) (4.6) 16.0 7.4 Total revenues 329.1 377.2 389.4 Expenses Benefits, claims and settlement expenses 212.0 212.8 204.4 Dividends to policyholders 92.6 117.8 116.3 Operating expenses 2.3 2.7 2.9 Total expenses 306.9 333.3 323.6 Closed Block revenues, net of Closed Block expenses, before income taxes 22.2 43.9 65.8 Income taxes 3.9 8.4 12.9 Closed Block revenues, net of Closed Block expenses and income taxes 18.3 35.5 52.9 Funding adjustments (4.0) (2.2) (3.0) Closed Block revenues, net of Closed Block expenses, income taxes and funding adjustments $ 14.3 $ 33.3 $ 49.9 The change in maximum future earnings of the Closed Block was as follows: For the year ended December 31, 2021 2020 2019 (in millions) Beginning of year $ 393.5 $ 426.9 $ 476.8 Effects of implementation of accounting changes (1) — 0.1 — End of year 379.2 393.5 426.9 Change in maximum future earnings $ (14.3) $ (33.3) $ (49.9) (1) Includes the effects of implementation of accounting changes related to credit losses in 2020. Principal Life charges the Closed Block with U.S. federal income taxes, payroll taxes, state and local premium taxes and other state or local taxes, licenses and fees as provided in the plan of reorganization. |
Deferred Acquisition Costs
Deferred Acquisition Costs | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Acquisition Costs | |
Deferred Acquisition Costs | 7. Deferred Acquisition Costs Acquisition costs deferred and amortized were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of year $ 3,409.7 $ 3,521.3 $ 3,693.5 Costs deferred during the year 461.4 457.0 473.5 Amortized to expense during the year (1) (285.4) (388.1) (347.0) Adjustment related to unrealized (gains) losses on available-for-sale securities and derivative instruments 171.8 (180.5) (298.7) Balance at end of year $ 3,757.5 $ 3,409.7 $ 3,521.3 (1) Includes adjustments for revisions to EGPs. |
Insurance Liabilities
Insurance Liabilities | 12 Months Ended |
Dec. 31, 2021 | |
Insurance Liabilities | |
Insurance Liabilities | 8. Insurance Liabilities Contractholder Funds Major components of contractholder funds in the consolidated statements of financial position were as follows: December 31, 2021 2020 (in millions) Liabilities for investment contracts: Liabilities for individual annuities $ 10,652.3 $ 12,864.1 GICs 12,206.0 11,858.0 Funding agreements 11,685.5 9,407.3 Other investment contracts 1,593.5 1,762.4 Total liabilities for investment contracts 36,137.3 35,891.8 Universal life and other reserves 7,460.7 7,345.9 Total contractholder funds $ 43,598.0 $ 43,237.7 Our GICs and funding agreements contain provisions limiting or prohibiting early surrenders, which typically include penalties for early surrenders, minimum notice requirements or, in the case of funding agreements with survivor options, minimum pre-death holding periods and specific maximum amounts. Funding agreements include those issued directly to nonqualified institutional investors and those issued to the FHLB Des Moines under their membership funding programs. As of December 31, 2021 and 2020, $4,252.4 million and $4,252.5 million, respectively, of liabilities were outstanding with respect to issuances under the program with FHLB Des Moines. In addition, we have five separate programs where the funding agreements have been issued directly or indirectly to unconsolidated special purpose entities. Claims for principal and interest under funding agreements are afforded equal priority to claims of life insurance and annuity policyholders under insolvency provisions of Iowa Insurance Laws. Principal Life was authorized to issue up to $4.0 billion of funding agreements under a program established in 1998 to support the prospective issuance of medium term notes by an unaffiliated entity in non-U.S. markets. As of both December 31, 2021 and 2020, $75.0 million of liabilities were outstanding with respect to the issuance outstanding under this program. Principal Life was also authorized to issue up to Euro 4.0 billion (approximately USD$5.3 billion) of funding agreements under a program established in 2006 to support the prospective issuance of medium term notes by an unaffiliated entity in non-U.S. markets. The unaffiliated entity is an unconsolidated special purpose entity. As of December 31, 2021 and 2020, $0.0 million and $122.4 million, respectively, of liabilities were outstanding with respect to issuances outstanding under this program. Principal Life does not anticipate any new issuance activity under either of these programs due to the existence of the program established in 2011 described below. In addition, Principal Life was authorized to issue up to $7.0 billion of funding agreements under a program established in 2001 to support the prospective issuance of medium term notes by an unaffiliated entity in both domestic and international markets. The unaffiliated entity is an unconsolidated special purpose entity. As of both December 31, 2021 and 2020, $201.8 million of liabilities were being held with respect to issuances outstanding under this program. Principal Life does not anticipate any new issuance activity under this program, given our December 2005 termination of the dealership agreement for this program and the availability of the program established in 2011 described below. Additionally, Principal Life was authorized to issue up to $5.0 billion of funding agreements under a program that was originally established in 2011 to support the prospective issuance of medium term notes by an unaffiliated entity in both domestic and international markets. The unaffiliated entity is an unconsolidated special purpose entity. In June 2015, this program was amended to authorize issuance of up to an additional $4.0 billion in recognition of the use of nearly all $5.0 billion of existing issuance authorization. In November 2017, this program was amended to authorize issuance of up to an additional $4.0 billion. In February 2021, this program was amended to authorize issuance of up to an additional $4.0 billion. As of December 31, 2021 and 2020, $7,156.3 million and $4,755.8 million, respectively, of liabilities were being held with respect to issuances outstanding under this program. Principal Life’s payment obligations on each funding agreement issued under this program are guaranteed by PFG. The program established in 2011 is not registered with the United States Securities and Exchange Commission (“SEC”). Liability for Unpaid Claims The liability for unpaid claims is reported in future policy benefits and claims within our consolidated statements of financial position. Activity associated with unpaid claims was as follows: For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of year $ 2,534.9 $ 2,365.5 $ 2,252.7 Less: reinsurance recoverable 436.9 403.8 404.3 Net balance at beginning of year 2,098.0 1,961.7 1,848.4 Incurred: Current year 1,572.5 1,376.8 1,361.3 Prior years 7.2 26.6 0.8 Total incurred 1,579.7 1,403.4 1,362.1 Payments: Current year 1,025.0 863.8 869.4 Prior years 435.4 403.3 379.4 Total payments 1,460.4 1,267.1 1,248.8 Net balance at end of year 2,217.3 2,098.0 1,961.7 Plus: reinsurance recoverable 442.1 436.9 403.8 Balance at end of year $ 2,659.4 $ 2,534.9 $ 2,365.5 Amounts not included in the rollforward above: Claim adjustment expense liabilities $ 59.5 $ 57.8 $ 57.9 Incurred liability adjustments relating to prior years, which affected current operations during 2021, 2020 and 2019, resulted in part from developed claims for prior years being different than were anticipated when the liabilities for unpaid claims were originally estimated. These trends have been considered in establishing the current year liability for unpaid claims. Short-Duration Contracts Claims Development The following tables present undiscounted information about claims development by incurral year, including separate information about incurred claims and paid claims net of reinsurance for the periods indicated. The tables also include information on incurred but not reported claims and the cumulative number of reported claims. The tables present information for the number of years for which claims incurred typically remain outstanding, but do not exceed ten years. The data is disaggregated into groupings of claims with similar characteristics, such as duration of the claim payment period and average claim amount, and with consideration to the overall size of the groupings. Outstanding liabilities equal total net incurred claims less total net paid claims plus outstanding liabilities for net unpaid claims of prior years. LTD and Group Life Waiver Claims Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2021 2021 ($ in millions) Incurral year 2012 $ 217.9 $ 200.0 $ 191.1 $ 189.5 $ 181.8 $ 174.8 $ 173.3 $ 171.9 $ 173.1 $ 172.2 $ 0.1 6,445 2013 219.3 203.3 188.4 190.7 182.3 179.5 177.1 173.4 174.5 0.1 7,051 2014 242.2 231.4 214.4 218.1 206.2 201.9 202.0 199.3 0.1 7,603 2015 231.0 227.2 217.2 215.3 208.2 210.0 211.8 0.1 7,180 2016 229.8 228.4 219.4 219.5 214.4 218.7 0.1 6,163 2017 238.4 239.7 243.1 245.8 245.2 0.1 6,080 2018 239.4 245.1 239.2 239.8 5.0 5,763 2019 255.2 248.4 240.4 7.5 5,917 2020 252.1 231.0 3.6 5,850 2021 259.7 97.3 3,271 Total net incurred claims $ 2,192.6 Net cumulative paid claims (1) December 31, 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 (in millions) Incurral year 2012 $ 13.8 $ 55.1 $ 80.8 $ 93.7 $ 104.6 $ 112.9 $ 120.0 $ 126.1 $ 131.5 $ 136.3 2013 12.5 55.0 81.4 97.0 106.4 116.4 123.2 129.0 134.9 2014 16.1 66.0 96.3 111.8 122.3 132.4 140.8 147.2 2015 16.9 67.0 98.0 114.6 126.8 137.1 146.5 2016 16.2 70.6 105.6 124.9 136.8 147.2 2017 17.8 76.5 115.0 135.9 151.7 2018 20.1 79.9 115.7 135.7 2019 19.2 79.7 117.5 2020 20.6 78.8 2021 19.8 Total net paid claims 1,215.6 All outstanding liabilities for unpaid claims prior to 2012 net of reinsurance 242.0 Total outstanding liabilities for unpaid claims net of reinsurance $ 1,219.0 (1) 2012-2020 unaudited. Dental, Vision, STD, Critical Illness and Accident Claims Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2020 2021 2021 2021 ($ in millions) Incurral year 2020 $ 679.8 $ 663.7 $ — 3,079,517 2021 826.0 49.2 3,564,753 Total net incurred claims $ 1,489.7 Net cumulative paid claims (1) December 31, 2020 2021 (in millions) Incurral year 2020 $ 609.5 $ 663.2 2021 753.4 Total net paid claims 1,416.6 All outstanding liabilities for unpaid claims prior to 2020 net of reinsurance — Total outstanding liabilities for unpaid claims net of reinsurance $ 73.1 (1) 2020 unaudited. Group Life Claims Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2020 2021 2021 2021 ($ in millions) Incurral year 2020 $ 270.6 $ 278.2 $ 0.9 6,251 2021 317.6 27.3 6,274 Total net incurred claims $ 595.8 Net cumulative paid claims (1) December 31, 2020 2021 (in millions) Incurral year 2020 $ 219.3 $ 276.5 2021 243.9 Total net paid claims 520.4 All outstanding liabilities for unpaid claims prior to 2020 net of reinsurance 4.8 Total outstanding liabilities for unpaid claims net of reinsurance $ 80.2 (1) 2020 unaudited. Reconciliation of Unpaid Claims to Liability for Unpaid Claims Our reconciliation of net outstanding liabilities for unpaid claims of short-duration contracts to the liability for unpaid claims follows: December 31, 2021 Dental, Vision, STD, LTD and Group Life Critical Illness and Waiver Accident Group Life Consolidated (in millions) Net outstanding liabilities for unpaid claims $ 1,219.0 $ 73.1 $ 80.2 $ 1,372.3 Reconciling items: Reinsurance recoverable on unpaid claims 46.5 — — 46.5 Impact of discounting (208.0) — — (208.0) Liability for unpaid claims - short-duration contracts $ 1,057.5 $ 73.1 $ 80.2 1,210.8 Insurance contracts other than short-duration 1,448.6 Liability for unpaid claims $ 2,659.4 Claim Duration and Payout Our historical average percentage of claims paid in each year from incurral was as follows: December 31, 2021 (1) Dental, Vision, STD, LTD and Group Life Critical Illness and Year Waiver Accident Group Life 1 7.9 % 91.8 % 80.3 % 2 24.6 8.0 17.7 3 15.3 4 8.3 5 5.8 6 5.0 7 4.2 8 3.4 9 3.3 10 2.7 (1) Unaudited. Discounting The following table provides the carrying amount of liabilities reported at present value for short-duration contract unpaid claims. We use a range of discount rates to derive the present value of the unpaid claims. The ranges of discount rates as well as the aggregate amount of discount deducted to derive the liabilities for unpaid claims and interest accretion recognized are also disclosed. Interest accretion is included in benefits, claims and settlement expenses within our consolidated statements of operations. Dental, Vision, STD, LTD and Group Life Critical Illness and Waiver Accident Group Life ($ in millions) Carrying amount of liabilities for unpaid claims December 31, 2021 $ 1,057.5 $ 73.1 $ 80.2 December 31, 2020 1,047.6 70.4 54.1 Range of discount rates December 31, 2021 2.8 - 7.0 % — - — % — - — % December 31, 2020 2.8 - 7.0 — - — — - — Aggregate amount of discount December 31, 2021 $ 208.0 $ — $ — December 31, 2020 214.5 — — Interest accretion For the year ended: December 31, 2021 $ 33.8 $ — $ — December 31, 2020 33.9 — — December 31, 2019 34.2 — — |
Debt
Debt | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Debt | 9. Debt Short-Term Debt The components of short-term debt were as follows: December 31, 2021 Financing Short-term debt Obligor/Applicant structure Maturity Capacity outstanding (in millions) PFG, Principal Financial Services, Inc. (“PFS”) and Principal Life as co-borrowers Credit facility November 2023 $ 600.0 $ — PFG, PFS, Principal Life and Principal Financial Services V (UK) Ltd as co-borrowers Credit facility November 2023 200.0 — Unsecured Principal International Chile (1) lines of credit 145.6 79.8 Total $ 945.6 $ 79.8 December 31, 2020 Financing Short-term debt Obligor/Applicant structure Maturity Capacity outstanding (in millions) PFG, PFS and Principal Life as co-borrowers Credit facility November 2023 $ 600.0 $ — PFG, PFS, Principal Life and Principal Financial Services V (UK) Ltd as co-borrowers Credit facility November 2023 200.0 — Unsecured Principal International Chile (1) lines of credit 186.6 84.7 Total $ 986.6 $ 84.7 (1) The unsecured lines of credit can be used for repurchase agreements or other borrowings. Each line has a maturity of less than one year . Our revolving credit facilities are committed and available for general corporate purposes. These credit facilities also provide 100% back-stop support for our commercial paper program, of which we had no outstanding balances as of December 31, 2021 and 2020. The weighted-average interest rate on short-term borrowings as of December 31, 2021 and 2020, was 3.2% and 3.4%, respectively. Long-Term Debt The components of long-term debt were as follows: December 31, 2021 Principal Net unamortized discount, premium and debt issuance costs Carrying amount (in millions) 3.3% notes payable, due 2022 $ 300.0 $ (0.3) $ 299.7 3.125% notes payable, due 2023 300.0 (0.4) 299.6 3.4% notes payable, due 2025 400.0 (1.7) 398.3 3.1% notes payable, due 2026 350.0 (1.9) 348.1 3.7% notes payable, due 2029 500.0 (5.0) 495.0 2.125% notes payable, due 2030 600.0 (4.1) 595.9 6.05% notes payable, due 2036 505.6 (2.3) 503.3 4.625% notes payable, due 2042 300.0 (3.0) 297.0 4.35% notes payable, due 2043 300.0 (3.0) 297.0 4.3% notes payable, due 2046 300.0 (3.1) 296.9 Floating rate notes payable, due 2055 400.0 (4.6) 395.4 Non-recourse mortgages and notes payable 53.7 0.3 54.0 Total long-term debt $ 4,309.3 $ (29.1) $ 4,280.2 December 31, 2020 Principal Net unamortized discount, premium and debt issuance costs Carrying amount (in millions) 3.3% notes payable, due 2022 $ 300.0 $ (0.7) $ 299.3 3.125% notes payable, due 2023 300.0 (0.7) 299.3 3.4% notes payable, due 2025 400.0 (2.2) 397.8 3.1% notes payable, due 2026 350.0 (2.1) 347.9 3.7% notes payable, due 2029 500.0 (5.5) 494.5 2.125% notes payable, due 2030 600.0 (4.6) 595.4 6.05% notes payable, due 2036 505.6 (2.5) 503.1 4.625% notes payable, due 2042 300.0 (3.1) 296.9 4.35% notes payable, due 2043 300.0 (3.1) 296.9 4.3% notes payable, due 2046 300.0 (3.2) 296.8 Floating rate notes payable, due 2055 400.0 (4.7) 395.3 Non-recourse mortgages and notes payable 55.5 0.5 56.0 Total long-term debt $ 4,311.1 $ (31.9) $ 4,279.2 Net discount, premium and issuance costs associated with issuing these notes are amortized to expense over the respective terms using the interest method. On June 12, 2020, we issued $500.0 million of senior notes at a discount. On August 3, 2020, we issued an additional $100.0 million of senior notes at a premium. These notes bear interest at 2.125% and will mature in 2030. Interest on the notes is payable semi-annually on June 15 and December 15 each year, beginning on December 15, 2020. The proceeds from these notes were used for general corporate purposes. On May 7, 2019, we issued $500.0 million of senior notes. The notes bear interest at 3.7% and will mature in 2029. Interest on the notes is payable semi-annually on May 15 and November 15 each year, beginning on November 15, 2019. The proceeds from these notes, along with available cash, were used to fund the acquisition of the Acquired Business. On November 10, 2016, we issued $650.0 million of senior notes. We issued a $350.0 million series of notes that bear interest at 3.1% and will mature in 2026 and a $300.0 million series of notes that bear interest at 4.3% and will mature in 2046. Interest on the notes is payable semi-annually on May 15 and November 15 each year, beginning on May 15, 2017. The proceeds from these notes were used to redeem our notes payable due in 2017 and 2019. We incurred a one-time cost to extinguish this debt before the scheduled maturity date. On May 7, 2015, we issued $400.0 million of senior notes. The notes bear interest at 3.4% and will mature in 2025. Interest on the notes is payable semi-annually on May 15 and November 15 each year, beginning on November 15, 2015. In addition, on May 7, 2015, we issued $400.0 million of junior subordinated notes, which are subordinated to all our senior debt. The notes became callable in 2020 and have a maturity date in 2055. The notes initially bore a fixed rate of interest at 4.7% and converted to a floating rate at the date the notes became callable. Interest on the notes is payable semi-annually on May 15 and November 15 each year. After the call date the notes bear interest at 3-month LIBOR plus 3.044%, reset quarterly and payable in arrears in February, May, August and November each year. We have the right to defer interest payments on the junior subordinated notes for up to 5 years without resulting in a default, during which time interest will be compounded. The proceeds from these notes were used to redeem preferred stock, with the remainder available for general corporate purposes. On November 16, 2012, we issued $900.0 million of senior notes. We issued a $300.0 million series of notes that bore interest at 1.85% and were to mature in 2017. These notes were repaid following our November 2016 debt issuance. We issued a $300.0 million series of notes that bear interest at 3.125% and will mature in 2023 and a $300.0 million series of notes that bear interest at 4.35% and will mature in 2043. Interest on the notes is payable semi-annually on May 15 and November 15 each year, beginning on May 15, 2013. The proceeds were used to fund our acquisition of Cuprum. On September 5, 2012, we issued $600.0 million of senior notes. We issued a $300.0 million series of notes that bear interest at 3.3% and will mature in 2022 and a $300.0 million series of notes that bear interest at 4.625% and will mature in 2042. Interest on the notes is payable semi-annually on March 15 and September 15 each year, beginning on March 15, 2013. The proceeds were used for the repayment of the $400.0 million aggregate principal amount of notes due in 2014 and to partially fund our acquisition of Cuprum. On October 16 and December 5, 2006, we issued $500.0 million and $100.0 million, respectively, of senior notes. The notes bear interest at a rate of 6.05% per year. Interest on the notes is payable semi-annually on April 15 The non-recourse mortgages and notes payable are primarily financings for real estate developments. Outstanding principal balances as of December 31, 2021, ranged from $3.1 million to $14.4 million per development with interest rates ranging from 3.5% to 4.8%. Outstanding principal balances as of December 31, 2020, ranged from $3.1 million to $15.1 million per development with interest rates ranging from 3.5% to 4.8%. Outstanding debt is secured by the underlying real estate properties, which were reported as real estate on our consolidated statements of financial position with a carrying value of $198.3 million and $194.1 million as of December 31, 2021 and 2020, respectively. As of December 31, 2021, future annual maturities of long-term debt were as follows (in millions): Year ending December 31: 2022 $ 301.8 2023 324.2 2024 17.5 2025 398.7 2026 354.7 Thereafter 2,883.3 Total future maturities of long-term debt $ 4,280.2 Contingent Funding Agreements for Senior Debt Issuance On March 8, 2018, we entered into two contingent funding agreements: (1) a 10-year contingent funding agreement with a Delaware trust (“2028 Trust”) formed by us in connection with the sale by the trust of $400.0 million pre-capitalized trust securities redeemable February 15, 2028 (“2028 P-Caps”) in a Rule 144A private placement and (2) a 30-year contingent funding agreement with a Delaware trust (“2048 Trust”) formed by us in connection with the sale by the trust of $350.0 million pre-capitalized trust securities redeemable February 15, 2048 (“2048 P-Caps”) in a Rule 144A private placement. The trusts invested the proceeds from the sale of the 2028 P-Caps and 2048 P-Caps in a portfolio of principal and interest strips of U.S. Treasury securities. The contingent funding agreements provide us a put option that gives us the right to sell at any time: (1) to the 2028 Trust up to $400.0 million of its 4.111% Senior Notes due 2028 (“4.111% Senior Notes”) and (2) to the 2048 Trust up to $350.0 million of its 4.682% Senior Notes due 2048 (“4.682% Senior Notes”) and receive in exchange a corresponding amount of the principal and interest strips of U.S. Treasury securities held by the trusts. The 4.111% Senior Notes and 4.682% Senior Notes will not be issued unless and until a put option is exercised. We agreed to pay a semi-annual put premium of 1.275% and 1.580% per annum on the unexercised portion of the put option to the 2028 Trust and 2048 Trust, respectively, and to reimburse the trusts for expenses. The put option premiums are recorded in operating expenses in the consolidated statements of operations. The 4.111% Senior Notes and 4.682% Senior Notes will be fully, irrevocably and unconditionally guaranteed by PFS. In addition, our obligations under the put option agreement and the expense reimbursement agreement with the trusts are also guaranteed by PFS. The contingent funding agreements with the trusts provide us with a source of liquid assets, which could be used to meet future financial obligations or to provide additional capital. The put options described above will be exercised automatically in full if we fail to make certain payments to the trusts, including any failure to pay the put option premium or expense reimbursements when due, if such failure is not cured within 30 days, and upon certain bankruptcy events involving us or PFS. We are also required to exercise the put option in full: (i) if we reasonably believe that our consolidated shareholders’ equity, calculated in accordance with U.S. GAAP but excluding AOCI and noncontrolling interest, has fallen below $4.0 billion, subject to adjustment in certain cases; (ii) upon the occurrence of an event of default under the 4.111% Senior Notes and 4.682% Senior Notes; and (iii) if certain events occur relating to each trust’s status as an “investment company” under the Investment Company Act of 1940. In addition, we are required to purchase from the trusts any principal and interest strips of U.S. Treasury securities that are due and not paid. We have an unlimited right to unwind a prior voluntary exercise of the put options by repurchasing all of the 4.111% Senior Notes and 4.682% Senior Notes held by the trusts in exchange for a corresponding amount of principal and interest strips of U.S. Treasury securities. If the put options have been fully exercised, the 4.111% Senior Notes and 4.682% Senior Notes issued may be redeemed by us prior to their maturity at par or, if greater, at a make-whole redemption price, in each case plus accrued and unpaid interest to the date of redemption. The 2028 P-Caps are to be redeemed by the 2028 Trust on February 15, 2028, or upon any early redemption of the 4.111% Senior Notes. The 2048 P-Caps are to be redeemed by the 2048 Trust on February 15, 2048, or upon any early redemption of the 4.682% Senior Notes. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Income Taxes | 10. Income Taxes Income Taxes (Benefits) Our income taxes (benefits) were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Current income taxes (benefits): U.S. federal $ 110.3 $ 15.8 $ 31.9 State 19.4 5.0 18.1 Foreign 38.3 55.4 45.6 Tax benefit of operating loss carryforward (1.2) (3.3) (3.0) Total current income taxes 166.8 72.9 92.6 Deferred income taxes (benefits): U.S. federal 154.6 143.6 108.6 State 16.6 11.5 6.9 Foreign (11.8) 37.0 41.1 Total deferred income taxes 159.4 192.1 156.6 Income taxes $ 326.2 $ 265.0 $ 249.2 Our income before income taxes was as follows: For the year ended December 31, 2021 2020 2019 (in millions) Domestic $ 1,889.1 $ 1,323.2 $ 1,351.9 Foreign 194.5 370.3 341.4 Total income before income taxes $ 2,083.6 $ 1,693.5 $ 1,693.3 Effective Income Tax Rate Our provision for income taxes may not have the customary relationship of taxes to income. A reconciliation between the U.S. corporate income tax rate and the effective income tax rate was as follows: For the year ended December 31, 2021 2020 2019 U.S. corporate income tax rate 21 % 21 % 21 % Dividends received deduction (4) (4) (5) Tax credits (2) (3) (3) Impact of equity method presentation (1) (1) (2) State income taxes 1 1 1 Local country permanent tax adjustments — — 1 Other 1 2 2 Effective income tax rate 16 % 16 % 15 % Unrecognized Tax Benefits Our changes in unrecognized tax benefits were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of period $ 46.9 $ 61.6 $ 42.1 Additions based on tax positions related to the current year 1.8 1.3 0.1 Additions for tax positions of prior years — 17.4 23.1 Reductions for tax positions related to the current year (3.2) (3.2) (3.2) Reductions for tax positions of prior years — — (0.5) Settlements — (14.5) — Expired statute of limitations — (15.7) — Balance at end of period (1) $ 45.5 $ 46.9 $ 61.6 (1) If recognized, $1.6 million of the above amount of unrecognized tax benefits would reduce our 2021 effective income tax rate. We recognize interest and penalties related to uncertain tax positions in operating expenses within the consolidated statements of operations. As of December 31, 2021, 2020 and 2019, we had recognized $1.2 million, $1.1 million and $0.9 million of accumulated pre-tax interest and penalties related to unrecognized tax benefits, respectively. We do not believe there is a reasonable possibility the total amount of the unrecognized tax benefits will significantly increase or decrease in the next twelve months considering recent settlements and the status of current and pending Internal Revenue Service (“IRS”) examinations. Net Deferred Income Taxes Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Our significant components of net deferred income taxes were as follows: December 31, 2021 2020 (in millions) Deferred income tax assets: Insurance liabilities $ — $ 552.4 Net operating and capital loss carryforwards 68.2 69.2 Tax credit carryforwards — 4.6 Employee benefits 377.9 389.1 Other deferred income tax assets — 62.2 Gross deferred income tax assets 446.1 1,077.5 Valuation allowance (28.0) (18.4) Total deferred income tax assets 418.1 1,059.1 Deferred income tax liabilities: Deferred acquisition costs (582.3) (522.6) Investments, including derivatives (304.2) (402.0) Net unrealized gains on available-for-sale securities (1,118.1) (1,762.1) Real estate (141.6) (158.5) Intangible assets (408.0) (387.5) Insurance liabilities (44.2) — Other deferred income tax liabilities (54.9) (43.4) Total deferred income tax liabilities (2,653.3) (3,276.1) Total net deferred income tax liabilities $ (2,235.2) $ (2,217.0) Our net deferred income taxes by jurisdiction were as follows: December 31, 2021 2020 (in millions) Deferred income tax assets: State $ 61.2 $ 81.1 Foreign 23.8 32.7 Net deferred income tax assets 85.0 113.8 Deferred income tax liabilities: U.S. federal (2,023.6) (2,011.8) Foreign (296.6) (319.0) Net deferred income tax liabilities (2,320.2) (2,330.8) Total net deferred income tax liabilities $ (2,235.2) $ (2,217.0) In management’s judgment, total deferred income tax assets are more likely than not to be realized. Included in the deferred income tax asset are tax carryforwards available to offset future taxable income or income taxes. As of December 31, 2021 and 2020, we had tax credit carryforwards for U.S. federal income tax purposes of $0.0 million and $4.6 million, respectively. Foreign and general business tax credit carryovers were generated during and since the period we utilized net operating losses, primarily attributable to our captive reinsurance companies that joined our consolidated U.S. federal income tax return beginning in 2012 and 2013. Alternative minimum tax credit carryforwards became refundable for the 2018 tax year under the 2020 CARES Act and were fully recovered. In addition, the foreign tax and general business credit carryforwards were fully utilized in 2020 and 2021, respectively. As of December 31, 2021 and 2020, domestic state net operating loss carryforwards were $267.3 million and $269.5 million, respectively, and will expire between 2032 and 2040. As of December 31, 2021 and 2020, foreign net operating loss carryforwards were $164.1 million and $170.3 million, respectively, with some expiring in 2021 while others never expire. We maintain valuation allowances by jurisdiction against the deferred income tax assets related to some of these carryforwards and other items, as utilization of these income tax benefits fail the more likely than not criteria in certain jurisdictions. As of December 31, 2021 and 2020, valuation allowances of $28.0 million and $18.4 million, respectively, had been recorded against the income tax benefits associated primarily with foreign net operating loss carryforwards. Adjustments to the valuation allowance will be made if there is a change in management’s assessment of the amount of the deferred income tax assets that are more likely than not to be realized. The effects of tax legislation on deferred taxes are recognized in the period of enactment. The State of Iowa coupled with the Internal Revenue Code effective January 1, 2019, and subsequently issued interpretative guidance in the fourth quarter of 2019 on application of the U.S. Global Intangible Low Taxed Income rules. The State of Iowa’s interpretation resulted in an $11.1 million increase in total income tax expense for adjustments to deferred tax assets and liabilities in our 2019 financial statements. Iowa legislation was enacted on June 29, 2020 to de-couple from the federal application of the U.S. Global Intangible Low Taxed Income rules effective retroactively to January 1, 2019; therefore, the above-mentioned increase in total income tax expense reported in 2019 was reversed in 2020. Deferred tax liabilities are recognized for taxes payable on the unremitted earnings from foreign operations of our subsidiaries, except where it is our intention to indefinitely reinvest a portion or all of these undistributed earnings. As of December 31, 2021 and 2020, any applicable taxes that would be due upon repatriation were not provided on approximately $912.8 million and $997.4 million, respectively, of such accumulated but undistributed earnings from operations of foreign subsidiaries. We currently do not intend to repatriate these unremitted earnings because we have several liquidity options to fund our domestic operations and obligations. These options include investing and financing activities, such as issuing debt, as well as cash flow and dividends from domestic operations. As of December 31, 2021 and 2020, it was not practicable to determine the amount of the unrecognized deferred tax liability that would arise if foreign earnings were remitted, due to the complexity of our international holding company structure, and other significant tax attributes and varying state tax laws. Taxes on remittances would be limited to foreign currency gains or losses, foreign withholding taxes and state income taxes, which we would anticipate to be immaterial. As of December 31, 2021, deferred taxes were also not provided on the approximately $106.2 million of excess book carrying value over tax basis with respect to the original investment in our foreign subsidiaries. A tax liability will be recognized when we no longer plan to indefinitely reinvest a portion or all of these earnings or when we plan to sell a portion or all of our ownership interest. Other Tax Information Income tax returns are filed in U.S. federal jurisdiction as well as various states and foreign jurisdictions where we and one or more of our subsidiaries conduct business. Although determined by jurisdiction, with few exceptions our tax uncertainties relate primarily to U.S. federal income tax matters. The IRS has completed examination of our consolidated U.S. federal income tax returns for years prior to 2015. IRS claims for refund for tax years 2004 through 2008, following settlement of a partnership matter with the Department of Justice in March 2019, were finalized in 2020 and have been received in full as of December 31, 2021. IRS claims for refund filed for tax years 2006 through 2008 were received in September 2020. In 2019, an IRS 30-day letter on examination of tax years 2009 through 2012 was received, the proposed adjustments found acceptable, and associated tax settlements subsequently occurred in 2020 prior to expiration of the extended statute of limitations. As of December 31, 2021 and 2020, we had $12.7 million and $54.6 million, respectively, of current income tax receivables associated with outstanding audit issues. The IRS is currently auditing our U.S. federal income tax returns for tax years 2015-2018. The U.S. federal statute of limitations expired for years prior to 2009, except for pending audit issues. The extended statute expired on June 30, 2021, for 2009 through 2012 although effectively settled, and the original statute has expired for both 2013 and 2014. Tax years 2015 and forward remain open through statute extensions or the normal statute of limitations. The ultimate settlement of earlier tax years can be adjusted into subsequent tax years regardless of statute status. We do not expect the results of these audits, subsequent related adjustments or developments in other tax areas for all open tax years to significantly change the possible increase in the amount of unrecognized tax benefits, but the outcome of tax reviews is uncertain and unforeseen results can occur. We believe we have adequate defenses against, or sufficient provisions for, contested issues, but final resolution could take several years depending on whether legal remedies are pursued. Consequently, we do not believe issues that might arise in tax years subsequent to 2014 will have a material impact on our net income. |
Employee and Agent Benefits
Employee and Agent Benefits | 12 Months Ended |
Dec. 31, 2021 | |
Employee and Agent Benefits | |
Employee and Agent Benefits | 11. Employee and Agent Benefits We provide a U.S. qualified defined benefit pension plan, covering U.S. employees that meet certain eligibility requirements and certain agents contracted on or before December 31, 2018. A final average pay benefit formula has been in place for plan participants employed prior to January 1, 2002. For agents, this formula ended on December 31, 2018, and for employees the formula will end on December 31, 2022. The final average pay benefit is based on the years of service and generally the employee’s or agent’s average annual compensation during the last five years prior to the earliest of termination, retirement or the formula end date. A cash balance benefit was added on January 1, 2002. A participant’s cash balance account is credited with an amount based on the participant’s salary, age and service. These credits accrue with interest. For plan participants hired on and after January 1, 2002, only the cash balance benefit applies. For pre-2002 participants, the pension benefit earned prior to the final average pay formula end date is the greater of the final average pay benefit or the cash balance benefit earned before the end date. They will also earn a new cash balance benefit for service after the formula end date. In addition, we sponsor non-qualified defined benefit plans subject to Section 409A of the Internal Revenue Code. This plan is for certain highly compensated employees and agents to replace the benefit that cannot be provided by the qualified defined benefit pension plan due to IRS limits. These nonqualified plans generally parallel the qualified plan but offer different payment options. No agent will become a new participant in the nonqualified plan after December 31, 2018. We provide certain health care, life insurance and long-term care benefits for retired employees, their beneficiaries and covered dependents (“other postretirement benefits”). While virtually all U.S. employees continue to have access to the post-retirement health care and life insurance benefits, only those U.S. employees that were hired prior to January 1, 2002, and retired prior to January 1, 2011, (post-65 medical) or January 1, 2020, (life insurance and pre-65 medical) were eligible to receive subsidized benefits. All others pay the full cost of coverage. The long-term care plan was subsidized only for those who retired prior to January 1, 2000, and is no longer accessible. The subsidy level for all benefits varies by plan, age, service and retirement date. The funding policy for all employee benefit plans is to fund the cost of providing pension benefits in the years that the employees and agents are providing service, taking into account the funding status of the trust. For the qualified defined benefit plan, this policy will be subject to an amount no lower than the minimum annual contribution required under the Employee Retirement Income Security Act (“ERISA”), and, generally, not greater than the maximum amount that can be deducted for U.S. federal income tax purposes. While we designate assets to cover the computed liability of the nonqualified pension plan, the assets are not included as part of the asset balances presented in this footnote as they do not qualify as plan assets in accordance with U.S. GAAP. Obligations and Funded Status The plans’ combined funded status, reconciled to amounts recognized in the consolidated statements of financial position, was as follows: Other postretirement Pension benefits benefits December 31, December 31, 2021 2020 2021 2020 (in millions) Change in benefit obligation Benefit obligation at beginning of year $ (4,210.2) $ (3,692.1) $ (108.0) $ (101.4) Service cost (83.2) (72.7) — — Interest cost (103.3) (117.3) (2.2) (2.8) Actuarial gain (loss) 75.8 (462.4) 7.6 (11.7) Participant contributions — — (6.1) (6.0) Benefits paid 137.2 134.3 13.5 12.8 Plan amendments — — — 1.0 Other — — (0.1) 0.1 Benefit obligation at end of year $ (4,183.7) $ (4,210.2) $ (95.3) $ (108.0) Change in plan assets Fair value of plan assets at beginning of year $ 3,373.5 $ 2,926.0 $ 780.6 $ 732.8 Actual return on plan assets 208.7 521.3 1.6 53.1 Employer contribution 105.1 60.5 1.5 1.5 Participant contributions — — 6.1 6.0 Benefits paid (137.2) (134.3) (13.5) (12.8) Assets re-designated for non-retiree benefits — — (656.5) — Fair value of plan assets at end of year $ 3,550.1 $ 3,373.5 $ 119.8 $ 780.6 Amount recognized in statement of financial position Other assets $ — $ — $ 24.5 $ 675.5 Other liabilities (633.6) (836.7) — (2.9) Total $ (633.6) $ (836.7) $ 24.5 $ 672.6 Amount recognized in accumulated other comprehensive (income) loss Total net actuarial (gain) loss $ 588.0 $ 760.0 $ (26.7) $ (22.8) Prior service benefit (104.2) (121.0) (6.2) (7.3) Pre-tax accumulated other comprehensive (income) loss $ 483.8 $ 639.0 $ (32.9) $ (30.1) The accumulated benefit obligation for all defined benefit pension plans was $4,149.3 million and $4,136.5 million as of December 31, 2021 and 2020, respectively. Employer contributions to the pension plans include contributions made directly to the qualified pension plan assets and contributions from corporate assets to pay nonqualified pension benefits. Benefits paid from the pension plans include both qualified and nonqualified plan benefits. Nonqualified pension plan assets are not included as part of the asset balances presented in this footnote. The nonqualified pension plan assets are held in Rabbi trusts for the benefit of all nonqualified plan participants. The assets held in a Rabbi trust are available to satisfy the claims of general creditors only in the event of bankruptcy. Therefore, these assets are fully consolidated in our consolidated statements of financial position and are not reflected in our funded status as they do not qualify as plan assets under U.S. GAAP. The market value of assets held in these trusts was $386.3 million and $394.8 million as of December 31, 2021 and 2020, respectively. Pension Plan Changes and Plan Gains/Losses For the year ended December 31, 2021, the pension plans had an actuarial gain primarily due to an increase in discount rate offset by changes in actuarial assumptions. For the year ended December 31, 2020, the pension plans had an actuarial loss primarily due to a decrease in the discount rate and change in actuarial assumptions. Other Postretirement Plan Changes and Plan Gains/Losses For the year ended December 31, 2021, the other postretirement benefit plans had an actuarial gain primarily due to an increase in the discount rate and actual, along with projected, medical claim costs being lower than previously expected. For the year ended December 31, 2020, the other postretirement benefit plans had an actuarial loss primarily due to a decrease in the discount rate and a higher than expected number of retirees electing medical coverage with the elimination of subsidized benefits. Effective January 1, 2021, $656.5 million of assets in excess of the expected liability to cover the postretirement medical benefits for retirees were re-designated for non-retiree benefits. The elections were made pursuant to plan provisions, which provide for assets in excess of 125% of expected liabilities to fund other benefits covered under the plans. The re-designated assets, net of associated tax receivable impacts related to a tax adjustment to accumulated other comprehensive income, are not included as part of the asset balances presented in the footnote as they no longer qualify as plan assets in accordance with U.S. GAAP. The re-designated assets are included in equity securities and other investments on our consolidated statements of financial position beginning January 1, 2021. Information for Pension Plans With an Accumulated Benefit Obligation in Excess of Plan Assets For 2021 and 2020, both the qualified and nonqualified plans had accumulated benefit obligations in excess of plan assets. As noted previously, the nonqualified plans have assets that are deposited in trusts that fail to meet the U.S. GAAP requirements to be included in plan assets; however, these assets are included in our consolidated statements of financial position. December 31, 2021 2020 (in millions) Projected benefit obligation $ 4,183.7 $ 4,210.2 Accumulated benefit obligation 4,149.3 4,136.5 Fair value of plan assets 3,550.1 3,373.5 Information for Other Postretirement Benefit Plans With an Accumulated Postretirement Benefit Obligation in Excess of Plan Assets December 31, 2021 2020 (in millions) Accumulated postretirement benefit obligation $ — $ 2.9 Fair value of plan assets — — Components of Net Periodic Benefit Cost Pension benefits Other postretirement benefits For the year ended December 31, 2021 2020 2019 2021 2020 2019 (in millions) Service cost $ 83.2 $ 72.7 $ 66.0 $ — $ — $ — Interest cost 103.3 117.3 126.5 2.2 2.8 3.7 Expected return on plan assets (182.7) (156.8) (148.8) (4.8) (36.0) (33.2) Amortization of prior service benefit (16.8) (16.8) (11.3) (1.1) (1.0) (1.2) Recognized net actuarial (gain) loss 70.2 75.4 70.1 (0.5) — 0.1 Net periodic benefit cost (income) $ 57.2 $ 91.8 $ 102.5 $ (4.2) $ (34.2) $ (30.6) The components of net periodic benefit cost including the service cost component are included in operating expenses on the consolidated statements of operations. The pension plans’ actuarial gains and losses are amortized using a straight-line amortization method over the average remaining service period of plan participants. The other postretirement plans use a straight-line amortization over the average future lifetime of its remaining covered group of retirees. For the qualified pension plan, gains and losses are amortized without use of the 10% allowable corridor. For the nonqualified pension plans and other postretirement benefit plans, the corridors allowed are used. Pension benefits Other postretirement benefits For the year ended December 31, 2021 2020 2021 2020 (in millions) Other changes recognized in accumulated other comprehensive (income) loss Net actuarial (gain) loss $ (101.8) $ 97.9 $ (4.4) $ (5.4) Prior service benefit — — — (1.0) Amortization of gain (loss) (70.2) (75.4) 0.5 — Amortization of prior service benefit 16.8 16.8 1.1 1.0 Total recognized in pre-tax accumulated other comprehensive (income) loss $ (155.2) $ 39.3 $ (2.8) $ (5.4) Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss $ (98.0) $ 131.1 $ (7.0) $ (39.6) Net actuarial (gain) loss and net prior service cost benefit have been recognized in AOCI. Assumptions Weighted-average assumptions used to determine benefit obligations as disclosed under the Obligations and Funded Status section Pension benefits For the year ended December 31, 2021 2020 Discount rate 2.75 % 2.50 % Interest crediting rate - cash balance benefit 5.00 % 5.00 % Rate of compensation increase 4.59 % 4.41 % Other postretirement benefits For the year ended December 31, 2021 2020 Discount rate 2.50 % 2.10 % Rate of compensation increase N/A N/A Weighted average assumptions used to determine net periodic benefit cost Pension benefits For the year ended December 31, 2021 2020 2019 Discount rate (1) 2.50 % 3.25 % 3.70 % Expected long-term return on plan assets 5.55 % 5.60 % 5.95 % Interest crediting rate - cash balance benefit 5.00 % 5.00 % — % Rate of compensation increase: Cash balance benefit 4.92 % 4.95 % 4.94 % Traditional benefit 2.96 % 2.98 % 2.73 % Other postretirement benefits For the year ended December 31, 2021 2020 2019 Discount rate (2) 2.10 % 2.95 % 3.95 % Expected long-term return on plan assets 4.25 % 4.94 % 5.19 % Rate of compensation increase N/A N/A N/A (1) During the second quarter of 2019, we amended The Principal Pension Plan and The Principal Financial Group Nonqualified Defined Benefit Plan for Employees to end traditional benefit accruals as of December 31, 2022, and begin cash balance accruals January 1, 2023. We remeasured the associated plan assets and pension benefit obligations as of May 31, 2019. A discount rate of 4.15% was used until the remeasurement date at which time a discount rate of 3.70% was used. (2) During the second quarter 2020, subsidy increases provided under the long-term care plan were capped at 5% per calendar year. This change was remeasured as of March 31, 2020. A discount rate of 2.95% was used until the remeasurement date at which time a discount rate of 2.90% was used. The assumed salary growth rates used to project benefits for the projected benefit obligation are age-based for home office employees. The rate labeled cash balance benefit (relative to employees accruing a cash balance) is the lifecount-weighted average rate of salary growth in the coming year only, as the impact of salary assumption for cash balance benefits are limited to the upcoming year service cost. The rate labeled traditional benefit (relative to employees still accruing a final average pay benefit) is the lifecount-weighted average (at each age) of the single annual growth rate at the age that is equivalent to applying the scale from that age to assumed termination or retirement ages. For the December 31, 2021, pension benefit obligation and going forward, one average rate of compensation increase is disclosed for all participants as the traditional benefit is frozen as of December 31, 2022. For the pension benefits, the discount rate is determined by projecting future benefit payments inherent in the projected benefit obligation and discounting those cash flows using a spot yield curve for high quality corporate bonds. The plans’ expected benefit payments are discounted to determine a present value using the yield curve and the discount rate is the level rate that produces the same present value. The expected return on plan assets is the long-term rate we expect to be earned based on the long-term investment policy of the plans and the various classes of invested funds. A weighted average rate was developed based on those overall rates and the target asset allocation of the plans. For other postretirement benefits, the discount rate is determined by projecting future benefit payments inherent in the accumulated postretirement benefit obligation and discounting those cash flows using a spot yield curve for high quality corporate bonds. The plans’ expected benefit payments are discounted to determine a present value using the yield curve and the discount rate is the level rate that produces the same present value. The 4.25% expected long-term return on plan assets for 2021 was based on the weighted average expected long-term asset returns for the plans. The expected long-term rates for the home office medical/life, agent medical/life and post-65 medical plans were 4.25%, 4.25% and 4.25%, respectively. Assumed Health Care Cost Trend Rates Used to Determine Net Periodic Benefit Cost December 31, 2021 2020 Health care cost trend rate assumed for next year under age 65 7.00 % 6.75 % Health care cost trend rate assumed for next year age 65 and over 6.50 % 6.00 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.50 % 4.50 % Year that the rate reaches the ultimate trend rate (under age 65) 2030 2029 Year that the rate reaches the ultimate trend rate (65 and older) 2029 2026 Pension Plan and Other Postretirement Benefit Plan Assets Fair value is defined as the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date (an exit price). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels. ● Level 1 – Fair values are based on unadjusted quoted prices in active markets for identical assets. ● Level 2 – Fair values are based on inputs other than quoted prices within Level 1 that are observable for the asset, either directly or indirectly. ● Level 3 – Fair values are based on significant unobservable inputs for the asset. Our pension plan assets consist of investments in pooled separate accounts and single client separate accounts. Net asset value (“NAV”) of the pooled separate accounts is calculated in a manner consistent with U.S. GAAP for investment companies and is determinative of their fair value. Several of the pooled separate accounts invest in publicly quoted mutual funds or actively managed stocks. The fair value of the underlying mutual funds or stocks is used to determine the NAV of the separate account, which is not publicly quoted. Some of the pooled separate accounts also invest in fixed income securities. The fair value of the underlying securities is based on quoted prices of similar assets and used to determine the NAV of the separate account. Some of the pooled separate accounts invest in real estate properties. The fair value is based on discounted cash flow valuation models that utilize public real estate market data inputs such as transaction prices, market rent growth, vacancy levels, leasing absorption, market capitalization rates and discount rates. The single client separate accounts invest in fixed income securities, hedge funds, a pooled separate account investment and other assets. The fixed income securities include U.S. Treasury bonds for which the fair value is based on quoted prices of identical assets in active markets. The fair value of the other fixed income securities is determined either from prices obtained from third party pricing vendors who use observable market information to determine prices or from internal models using substantially all observable inputs or a matrix pricing valuation approach. The hedge funds are measured at fair value using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy. The NAV of the pooled separate account investment is calculated in a manner consistent with U.S. GAAP for investment companies and is determinative of its fair value. The carrying amounts of other assets, which are highly liquid in nature, are used to approximate fair value. Our other postretirement benefit plan assets consist of cash, investments in fixed income security portfolios and investments in equity security portfolios. Because of the nature of cash, its carrying amount approximates fair value. The fair value of fixed income investment funds, U.S. equity portfolios and international equity portfolios is based on quoted prices in active markets for identical assets. Pension Plan Assets The fair value of the qualified pension plan’s assets by asset category as of the most recent measurement date was as follows: December 31, 2021 Assets Amount Fair value hierarchy level measured at measured at fair value net asset value Level 1 Level 2 Level 3 (in millions) Asset category Pooled separate account investments: U.S. large cap equity portfolios (1) $ 422.5 $ — $ — $ 422.5 $ — U.S. small/mid cap equity portfolios (2) 65.9 — — 65.9 — Balanced asset portfolios (3) 119.0 — — 119.0 — International equity portfolios (4) 252.5 — — 252.5 — Real estate investment portfolios (5) 239.6 — — 239.6 — Single client separate account investments: Fixed income securities: U.S. government and agencies 451.2 — 451.2 — — States and political subdivisions 31.2 — — 31.2 — Corporate 1,678.1 — — 1,678.1 — Commercial mortgage-backed securities 18.2 — — 18.2 — Other debt obligations 9.2 — — 9.2 — Hedge funds (6) 175.7 175.7 — — — Pooled separate account investment (7) 79.3 — — 79.3 — Other (8) 7.7 — — 7.7 — Total $ 3,550.1 $ 175.7 $ 451.2 $ 2,923.2 $ — December 31, 2020 Assets Amount Fair value hierarchy level measured at measured at fair value net asset value Level 1 Level 2 Level 3 (in millions) Asset category Pooled separate account investments: U.S. large cap equity portfolios (1) $ 712.2 $ — $ — $ 712.2 $ — U.S. small/mid cap equity portfolios (2) 121.6 — — 121.6 — Balanced asset portfolios (3) 103.7 — — 103.7 — International equity portfolios (4) 459.6 — — 459.6 — Real estate investment portfolios (5) 195.1 — — 195.1 — Single client separate account investments: Fixed income securities: U.S. government and agencies 297.5 — 297.5 — — States and political subdivisions 28.0 — — 28.0 — Corporate 1,223.1 — — 1,223.1 — Commercial mortgage-backed securities 13.6 — — 13.6 — Other debt obligations 6.4 — — 6.4 — Hedge funds (6) 155.8 155.8 — — — Pooled separate account investment (7) 55.1 — — 55.1 — Other (8) 1.8 — — 1.8 — Total $ 3,373.5 $ 155.8 $ 297.5 $ 2,920.2 $ — (1) The portfolios invest primarily in publicly traded equity securities of large U.S. companies. (2) The portfolios invest primarily in publicly traded equity securities of mid-sized and small U.S. companies. (3) The portfolios are a combination of underlying fixed income and equity investment options. These investment options may include balanced, asset allocation, target-date and target-risk investment options. Although typically lower risk than investment options that invest solely in equities, all investment options in this category have the potential to lose value. (4) The portfolios invest primarily in publicly traded equity securities of non-U.S. companies. (5) The portfolio invests primarily in U.S. commercial real estate properties through a separate account. (6) The hedge funds have varying investment strategies that also have a variety of redemption terms and conditions. We do not have unfunded commitments associated with these hedge funds. (7) The single client separate accounts invest in a money market pooled separate account. (8) Includes cash and net (payables)/receivables for the single client separate accounts. We have established an investment policy that provides the investment objectives and guidelines for the pension plan. Our investment strategy is to achieve the following: ● Obtain a reasonable long-term return consistent with the level of risk assumed and at a cost of operation within prudent levels. Performance benchmarks are monitored. ● Ensure sufficient liquidity to meet the emerging benefit liabilities for the plan. ● Provide for diversification of assets in an effort to avoid the risk of large losses and maximize the investment return to the pension plan consistent with market and economic risk. In administering the qualified pension plan’s asset allocation strategy, we consider the projected liability stream of benefit payments, the relationship between current and projected assets of the plan and the projected actuarial liabilities streams, the historical performance of capital markets adjusted for the perception of future short- and long-term capital market performance and the perception of future economic conditions. According to our investment policy, the target asset allocation for the qualified plan is: Asset category Target allocation Fixed income security portfolios 25 % - 80 % Equity portfolios 5 % - 60 % Real estate investment portfolios 10 % Alternatives 0 % - 5 % Other Postretirement Benefit Plan Assets The fair value of the other postretirement benefit plans’ assets by asset category as of the most recent measurement date was as follows: December 31, 2021 Assets Fair value hierarchy level measured at fair value Level 1 Level 2 Level 3 (in millions) Asset category Cash and cash equivalents $ 0.6 $ 0.6 $ — $ — Fixed income security portfolios (1) 57.7 57.7 — — U.S. equity portfolios (2) 42.8 42.8 — — International equity portfolios (3) 18.7 18.7 — — Total $ 119.8 $ 119.8 $ — $ — December 31, 2020 Assets Fair value hierarchy level measured at fair value Level 1 Level 2 Level 3 (in millions) Asset category Cash and cash equivalents $ 0.5 $ 0.5 $ — $ — Fixed income security portfolios (1) 625.2 605.9 19.3 — U.S. equity portfolios (2) 103.5 38.2 65.3 — International equity portfolios (3) 51.4 18.4 33.0 — Total $ 780.6 $ 663.0 $ 117.6 $ — (1) The portfolios invest in various fixed income securities, primarily of U.S. origin. These include, but are not limited to, corporate bonds, residential mortgage-backed securities, commercial mortgage-backed securities, U.S. Treasury securities, agency securities, asset-backed securities and collateralized mortgage obligations. (2) The portfolios invest primarily in publicly traded equity securities of large U.S. companies. (3) The portfolios invest primarily in publicly traded equity securities of non-U.S. companies. As of December 31, 2020, $117.6 million of assets in cash, fixed income security portfolios, U.S. equity portfolios and international equity portfolios were included in a trust owned life insurance contract. Effective January 1, 2021, these assets were redesignated for other welfare benefits. The investment strategies for the other postretirement benefit plans are similar to those employed by the qualified pension plan. According to our investment policy, the target asset allocation for the other postretirement benefit plans is: Asset category Target allocation Fixed income security portfolios 50 % U.S. equity portfolios 35 % International equity portfolios 15 % Contributions Our funding policy for the qualified pension plan is to fund the plan annually in an amount at least equal to the minimum annual contribution required under ERISA and, generally, not greater than the maximum amount that can be deducted for U.S. federal income tax purposes. We do not anticipate contributions will be needed to satisfy the minimum funding requirements of ERISA for our qualified plan. We are unable to estimate the amount that may be contributed, but it is possible that we may fund the plans in 2022 up to $75.0 million. This includes funding for both our qualified and nonqualified pension plans. While we designate assets to cover the computed liability of the nonqualified plan, the assets are not included as part of the asset balances presented in this footnote as they do not qualify as plan assets in accordance with U.S. GAAP. We may contribute to our other postretirement benefit plans in 2022 pending future analysis. Estimated Future Benefit Payments The estimated future benefit payments, which reflect expected future service, are: Other postretirement benefits (gross benefit payments, including Pension benefits prescription drug benefits) (in millions) Year ending December 31: 2022 $ 173.6 $ 14.5 2023 166.4 13.3 2024 178.6 12.2 2025 182.0 11.0 2026 192.5 9.7 2027-2031 1,087.3 35.9 The above table reflects the total estimated future benefits to be paid from the plan, including both our share of the benefit cost and the participants’ share of the cost, which is funded by their contributions to the plan. The assumptions used in calculating the estimated future benefit payments are the same as those used to measure the benefit obligation for the year ended December 31, 2021. Defined Benefit Pension Plans Supplemental Information Certain key summary data is shown below separately for qualified and nonqualified plans. For the year ended December 31, 2021 2020 Qualified Nonqualified Qualified Nonqualified Plan Plan Total Plan Plan Total (in millions) Amount recognized in statement of financial position Other assets $ — $ — $ — $ — $ — $ — Other liabilities (108.4) (525.2) (633.6) (294.9) (541.8) (836.7) Total $ (108.4) $ (525.2) $ (633.6) $ (294.9) $ (541.8) $ (836.7) Amount recognized in accumulated other comprehensive loss Total net actuarial loss $ 415.5 $ 172.5 $ 588.0 $ 563.5 $ 196.5 $ 760.0 Prior service benefit (85.2) (19.0) (104.2) (97.8) (23.2) (121.0) Pre-tax accumulated other comprehensive loss $ 330.3 $ 153.5 $ 483.8 $ 465.7 $ 173.3 $ 639.0 Components of net periodic benefit cost Service cost $ 76.2 $ 7.0 $ 83.2 $ 66.1 $ 6.6 $ 72.7 Interest cost 90.1 13.2 103.3 101.2 16.1 117.3 Expected return on plan assets (182.7) — (182.7) (156.8) — (156.8) Amortization of prior service benefit (12.6) (4.2) (16.8) (12.6) (4.2) (16.8) Recognized net actuarial loss 52.8 17.4 70.2 59.9 15.5 75.4 Net periodic benefit cost $ 23.8 $ 33.4 $ 57.2 $ 57.8 $ 34.0 $ 91.8 Other changes recognized in accumulated other comprehensive (income) loss Net actuarial (gain) loss $ (95.3) $ (6.5) $ (101.8) $ 55.7 $ 42.2 $ 97.9 Amortization of net loss (52.8) (17.4) (70.2) (59.8) (15.6) (75.4) Amortization of prior service benefit 12.6 4.2 16.8 12.6 4.2 16.8 Total recognized in pre-tax accumulated other comprehensive (income) loss $ (135.5) $ (19.7) $ (155.2) $ 8.5 $ 30.8 $ 39.3 Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss $ (111.7) $ 13.7 $ (98.0) $ 66.3 $ 64.8 $ 131.1 Defined Contribution and Deferred Compensation Plans In addition, we have defined contribution plans that are generally available to all U.S. employees and agents. Eligible participants could not contribute more than $19,500 of their compensation to the plans in 2021. Effective January 1, 2006, we made several changes to the retirement programs. In general, the pension and supplemental executive retirement plan benefit formulas were reduced and the 401(k) matching contribution was increased. Employees who were ages 47 or older with at least ten years of service on December 31, 2005, could elect to retain the prior benefit provisions and forgo receipt of the additional matching contributions. The employees who elected to retain the prior benefit provisions are referred to as “Grandfathered Choice Participants.” We match the Grandfathered Choice Participant’s contribution at a 50% contribution rate up to a maximum matching contribution of 3% of the participant’s compensation. Fo |
Contingencies, Guarantees, Inde
Contingencies, Guarantees, Indemnifications and Leases | 12 Months Ended |
Dec. 31, 2021 | |
Contingencies, Guarantees, Indemnifications and Leases | |
Contingencies, Guarantees, Indemnifications and Leases | 12. Contingencies, Guarantees, Indemnifications and Leases Litigation and Regulatory Contingencies We are regularly involved in litigation, both as a defendant and as a plaintiff, but primarily as a defendant. Litigation naming us as a defendant ordinarily arises out of our business operations as a provider of asset management and accumulation products and services, individual life insurance, specialty benefits insurance and our investment activities. Some of the lawsuits may be class actions, or purport to be, and some may include claims for unspecified or substantial punitive and treble damages. We may discuss such litigation in one of three ways. We accrue a charge to income and disclose legal matters for which the chance of loss is probable and for which the amount of loss can be reasonably estimated. We may disclose contingencies for which the chance of loss is reasonably possible and provide an estimate of the possible loss or range of loss or a statement that such an estimate cannot be made. Finally, we may voluntarily disclose loss contingencies for which the chance of loss is remote in order to provide information concerning matters that potentially expose us to possible losses. In addition, regulatory bodies such as state insurance departments, the SEC, the Financial Industry Regulatory Authority (“FINRA”), the Department of Labor (“DOL”) and other regulatory agencies in the U.S. and in international locations in which we do business, regularly make inquiries and conduct examinations or investigations concerning our compliance with, among other things, insurance laws, securities laws, ERISA and laws governing the activities of broker-dealers. We receive requests from regulators and other governmental authorities relating to industry issues and may receive additional requests, including subpoenas and interrogatories, in the future. On November 12, 2014, Frederick Rozo filed a class action lawsuit in the United States District Court for the Southern District of Iowa against Principal Life and us. We were later dismissed as a defendant. The Plaintiff alleged that defendants breached fiduciary duties and engaged in prohibited transactions under ERISA in connection with a general account guaranteed product known as the Principal Fixed Income Option (“PFIO”). On May 12, 2017, the district court certified a nationwide class of participants and beneficiaries who had funds invested in one of the PFIO contracts. On September 25, 2018, the district court granted Principal Life’s motion for summary judgment. On February 3, 2020, the Eighth Circuit Court of Appeals reversed that ruling and remanded the case back to the district court. A bench trial was held before the district court November 3-10, 2020. The court issued its ruling on April 8, 2021, and found in favor of Principal Life on all claims. The Plaintiff has appealed this ruling to the Eighth Circuit Court of Appeals. Principal Life will continue to aggressively defend the case. While the outcome of any pending or future litigation or regulatory matter cannot be predicted, management does not believe any such matter will have a material adverse effect on our business or financial position. As of December 31, 2021, we had no estimated loss accrued related to the legal matter discussed above because we believe the chance of loss from this matter is not probable and the amount of loss cannot be reasonably estimated. To the extent such matters present a reasonably possible chance of loss, we are generally not able to estimate the possible loss or range of loss associated therewith. The outcome of such matters is always uncertain and unforeseen results can occur. It is possible that such outcomes could require us to pay damages or make other expenditures or establish accruals in amounts that we could not estimate at December 31, 2021. Guarantees and Indemnifications In the normal course of business, we have provided guarantees to third parties primarily related to former subsidiaries and joint ventures. The terms of these agreements range in duration and often are not explicitly defined. The maximum exposure under these agreements as of December 31, 2021, was approximately $102.0 million. At inception, the fair value of such guarantees was insignificant. In addition, we believe the likelihood is remote that material payments will be required. Therefore, any liability accrued within our consolidated statements of financial position is insignificant. Should we be required to perform under these guarantees, we generally could recover a portion of the loss from third parties through recourse provisions included in agreements with such parties, the sale of assets held as collateral that can be liquidated in the event performance is required under the guarantees or other recourse generally available to us; therefore, such guarantees would not result in a material adverse effect on our business or financial position. While the likelihood is remote, such outcomes could materially affect net income in a particular quarter or annual period. Furthermore, in connection with our contingent funding agreements, we are required to purchase any principal and interest strips of U.S. Treasury securities that are due and not paid from the associated unconsolidated trusts. The maximum exposure under these agreements as of December 31, 2021, was $750.0 million. See Note 9, Debt, for further details. We manage mandatory privatized social security funds in Chile. By regulation, we have a required minimum guarantee on the funds’ relative return. Because the guarantee has no limitation with respect to duration or amount, the maximum exposure of the guarantee in the future is indeterminable. We are also subject to various other indemnification obligations issued in conjunction with divestitures, acquisitions and financing transactions whose terms range in duration and often are not explicitly defined. Certain portions of these indemnifications may be capped, while other portions are not subject to such limitations; therefore, the overall maximum amount of the obligation under the indemnifications cannot be reasonably estimated. At inception, the fair value of such indemnifications was insignificant. In addition, we believe the likelihood is remote that material payments will be required. Therefore, any liability accrued within our consolidated statements of financial position is insignificant. While we are unable to estimate with certainty the ultimate legal and financial liability with respect to these indemnifications, we believe that performance under these indemnifications would not result in a material adverse effect on our business or financial position. While the likelihood is remote, performance under these indemnifications could materially affect net income in a particular quarter or annual period. Guaranty Funds Under state insurance guaranty fund laws, insurers doing business in a state can be assessed, up to prescribed limits, for certain obligations of insolvent insurance companies to policyholders and claimants. A state’s fund assesses its members based on their pro rata market share of written premiums in the state for the classes of insurance for which the insolvent insurer was engaged. Some states permit member insurers to recover assessments paid through full or partial premium tax offsets. We accrue liabilities for guaranty fund assessments when an assessment is probable, can be reasonably estimated and when the event obligating us to pay has occurred. While we cannot predict the amount and timing of any future assessments, we have established reserves we believe are adequate for assessments relating to insurance companies that are currently subject to insolvency proceedings. As of December 31, 2021 and 2020, the liability balance for guaranty fund assessments, which is not discounted, was $21.0 million and $21.1 million, respectively, and was reported within other liabilities in the consolidated statements of financial position. As of December 31, 2021 and 2020, $9.7 million and $9.6 million, respectively, related to premium tax offsets were included in premiums due and other receivables in the consolidated statements of financial position. Leases As a lessee, we lease office space, data processing equipment, office furniture and office equipment under various operating leases. We also lease buildings and hardware storage equipment under finance leases. Lease assets and liabilities are recognized at the commencement of a lease based on the present value of lease payments over the lease term. We generally use our incremental borrowing rate based on the information available at the lease commencement date to determine the present value of lease payments. Lease term may include options to extend or terminate the lease when it is reasonably certain we will exercise the option. Leases with an initial term of twelve months or less are not recorded on the consolidated statements of financial position. We recognize lease expense for leases on a straight-line basis over the lease term. Some of our lease agreements include payments for property taxes, insurance, utilities or common area maintenance, which are not based on an index or rate. These payments are recognized in net income in the period in which the obligation has occurred. We sublease certain office space to third parties, which are primarily operating leases. We record sublease income on a straight-line basis over the lease term. The lease assets and liabilities were as follows: December 31, 2021 2020 (in millions) Assets Operating lease assets (1) $ 210.5 $ 234.9 Finance lease assets (1) 94.2 49.5 Total lease assets $ 304.7 $ 284.4 Liabilities Operating lease liabilities (2) $ 209.9 $ 231.4 Finance lease liabilities (2) 94.8 50.1 Total lease liabilities $ 304.7 $ 281.5 (1) Operating and finance lease assets are primarily reported within property and equipment on the consolidated statements of financial position. (2) Operating and finance lease liabilities are reported within other liabilities on the consolidated statements of financial position. The lease cost was as follows: For the year ended December 31, 2021 2020 2019 (in millions) Finance lease cost (1): Amortization of right-of-use assets $ 30.5 $ 20.5 $ 14.6 Interest on lease liabilities 1.0 1.0 1.0 Operating lease cost (1) 66.6 58.7 55.8 Other lease cost (1) (2) 10.8 8.6 8.0 Sublease income (3) (1.7) (1.6) (1.7) Total lease cost $ 107.2 $ 87.2 $ 77.7 (1) Finance, operating and other lease costs are primarily included in operating expenses on the consolidated statements of operations. (2) Other lease cost primarily reflects variable and short-term lease costs. (3) Sublease income is included in fees and other revenues on the consolidated statements of operations. Payments for operating leases for the years ended December 31, 2021, 2020 and 2019, were $63.0 million, $71.6 million and $56.1 million, respectively. Payments for finance leases for the years ended December 31, 2021, 2020 and 2019, were $31.4 million, $21.2 million and $15.1 million, respectively. The following represents future payments due by period for lease obligations: Operating leases Finance leases Total (in millions) For the twelve months ending December 31: 2022 $ 55.6 $ 32.8 $ 88.4 2023 46.5 31.4 77.9 2024 34.3 23.7 58.0 2025 27.9 7.9 35.8 2026 22.7 0.5 23.2 2027 and thereafter 47.2 — 47.2 Total lease payments 234.2 96.3 330.5 Less: interest 24.3 1.5 25.8 Present value of lease liabilities $ 209.9 $ 94.8 $ 304.7 The weighted-average remaining lease term and weighted-average discount rates were as follows: For the year ended December 31, 2021 2020 2019 Weighted-average remaining lease term (in years): Operating leases 6.5 6.7 6.7 Finance leases 3.2 3.0 2.6 Weighted-average discount rate: Operating leases 3.4 % 3.2 % 3.9 % Finance leases 1.0 % 1.8 % 2.7 % |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity | |
Stockholders' Equity | 13. Stockholders’ Equity Common Stock Dividends For the year ended December 31, 2021 2020 2019 Dividends declared per common share $ 2.44 $ 2.24 $ 2.18 Reconciliation of Outstanding Common Shares For the year ended December 31, 2021 2020 2019 (in millions) Beginning balance 273.3 276.6 279.5 Shares issued 3.0 2.6 2.6 Treasury stock acquired (14.6) (5.9) (5.5) Ending balance 261.7 273.3 276.6 In November 2018, our Board of Directors (“Board”) authorized a share repurchase program of up to $500.0 million of our outstanding common stock, which was completed in February 2020. In February 2020, our Board authorized a share repurchase program of up to $900.0 million of our outstanding common stock, which has no expiration date. In June 2021, our Board authorized a share repurchase program of up to $1.2 billion of our outstanding common stock, which has no expiration date. In January 2022, our Board authorized a $1.6 billion increase to the June 2021 share repurchase program authorization, which has no expiration date. See Note 20, Subsequent Events, for further details. Shares repurchased under these programs are accounted for as treasury stock, carried at cost and reflected as a reduction to stockholders’ equity. Other Comprehensive Income (Loss) For the year ended December 31, 2021 Pre-Tax Tax After-Tax (in millions) Net unrealized losses on available-for-sale securities during the period $ (2,960.0) $ 665.4 $ (2,294.6) Reclassification adjustment for losses included in net income (1) 19.4 (5.1) 14.3 Adjustments for assumed changes in amortization patterns 171.4 (36.0) 135.4 Adjustments for assumed changes in policyholder liabilities 1,913.1 (439.1) 1,474.0 Net unrealized losses on available-for-sale securities (856.1) 185.2 (670.9) Net unrealized gains on derivative instruments during the period 66.7 (14.0) 52.7 Reclassification adjustment for gains included in net income (3) (25.5) 5.4 (20.1) Adjustments for assumed changes in amortization patterns (0.2) — (0.2) Adjustments for assumed changes in policyholder liabilities 1.6 (0.4) 1.2 Net unrealized gains on derivative instruments 42.6 (9.0) 33.6 Foreign currency translation adjustment during the period (267.9) (5.6) (273.5) Reclassification adjustment for losses included in net income (4) 19.3 — 19.3 Foreign currency translation adjustment (248.6) (5.6) (254.2) Unrecognized postretirement benefit obligation during the period 106.5 (28.5) 78.0 Amortization of amounts included in net periodic benefit cost (5) 51.8 (14.0) 37.8 Net unrecognized postretirement benefit obligation 158.3 (42.5) 115.8 Other comprehensive loss $ (903.8) $ 128.1 $ (775.7) For the year ended December 31, 2020 Pre-Tax Tax After-Tax (in millions) Net unrealized gains on available-for-sale securities during the period $ 3,441.4 $ (728.7) $ 2,712.7 Reclassification adjustment for gains included in net income (1) (52.9) 12.6 (40.3) Adjustments for assumed changes in amortization patterns (179.0) 37.6 (141.4) Adjustments for assumed changes in policyholder liabilities (1,478.2) 323.7 (1,154.5) Net unrealized gains on available-for-sale securities 1,731.3 (354.8) 1,376.5 Net unrealized losses on derivative instruments during the period (28.1) 6.5 (21.6) Reclassification adjustment for gains included in net income (3) (27.1) 5.1 (22.0) Adjustments for assumed changes in amortization patterns 2.7 (0.5) 2.2 Adjustments for assumed changes in policyholder liabilities 7.8 (1.6) 6.2 Net unrealized losses on derivative instruments (44.7) 9.5 (35.2) Foreign currency translation adjustment during the period (11.7) (2.6) (14.3) Reclassification adjustment for losses included in net income (4) 43.0 1.9 44.9 Foreign currency translation adjustment 31.3 (0.7) 30.6 Unrecognized postretirement benefit obligation during the period (91.9) 24.9 (67.0) Amortization of amounts included in net periodic benefit cost (5) 57.6 (15.5) 42.1 Net unrecognized postretirement benefit obligation (34.3) 9.4 (24.9) Other comprehensive income $ 1,683.6 $ (336.6) $ 1,347.0 For the year ended December 31, 2019 Pre-Tax Tax After-Tax (in millions) Net unrealized gains on available-for-sale securities during the period $ 4,414.1 $ (947.0) $ 3,467.1 Reclassification adjustment for losses included in net income (1) 47.4 (9.7) 37.7 Adjustments for assumed changes in amortization patterns (293.0) 61.5 (231.5) Adjustments for assumed changes in policyholder liabilities (847.7) 190.5 (657.2) Net unrealized gains on available-for-sale securities 3,320.8 (704.7) 2,616.1 Noncredit component of impairment losses on fixed maturities, available-for-sale during the period 5.2 (1.1) 4.1 Adjustments for assumed changes in amortization patterns (1.4) 0.3 (1.1) Noncredit component of impairment losses on fixed maturities, available-for-sale (2) 3.8 (0.8) 3.0 Net unrealized losses on derivative instruments during the period (0.5) — (0.5) Reclassification adjustment for gains included in net income (3) (23.9) 4.9 (19.0) Adjustments for assumed changes in amortization patterns 3.1 (0.6) 2.5 Adjustments for assumed changes in policyholder liabilities 7.9 (1.9) 6.0 Net unrealized losses on derivative instruments (13.4) 2.4 (11.0) Foreign currency translation adjustment during the period (112.3) 7.5 (104.8) Reclassification adjustment for losses included in net income (4) 26.1 — 26.1 Foreign currency translation adjustment (86.2) 7.5 (78.7) Unrecognized postretirement benefit obligation during the period 43.6 (8.6) 35.0 Amortization of amounts included in net periodic benefit cost (5) 57.7 (15.4) 42.3 Net unrecognized postretirement benefit obligation 101.3 (24.0) 77.3 Other comprehensive income $ 3,326.3 $ (719.6) $ 2,606.7 (1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in net realized capital gains (losses) on the consolidated statements of operations. (2) Prior to 2020, represents the net impact of (1) unrealized gains resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold and (2) unrealized losses resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI. (3) See Note 5, Derivative Financial Instruments, under the caption “Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations” for further details. (4) The 2021 pre-tax reclassification adjustment related to the release of cumulative translation adjustment from the dissolution of foreign subsidiaries. The 2020 pre-tax reclassification adjustment primarily related to the release of the cumulative translation adjustment from the dissolution of a foreign subsidiary and the net impact of deconsolidated sponsored investment funds and associated net investment hedges. The 2019 pre-tax reclassification adjustment primarily related to deconsolidated sponsored investment funds. The adjustments were reported in net realized capital gains (losses) on the consolidated statements of operations. For the years ended December 31, 2020 and 2019, $8.7 million and $5.7 million, respectively, of this reclassification relates to noncontrolling interest and is reported in net income attributable to noncontrolling interest on the consolidated statements of operations. (5) Amount is comprised of amortization of prior service cost (benefit) and recognized net actuarial (gain) loss, which is reported in operating expenses on the consolidated statements of operations. See Note 11, Employee and Agent Benefits, under the caption “Components of Net Periodic Benefit Cost” for further details. Accumulated Other Comprehensive Income Noncredit Net unrealized component of Net unrealized Foreign Unrecognized Accumulated gains on impairment losses gains currency postretirement other available-for-sale on fixed maturities on derivative translation benefit comprehensive securities (1) available-for-sale (2) instruments adjustment obligation income (in millions) Balances as of January 1, 2019 $ 190.0 $ (47.1) $ 64.4 $ (1,259.5) $ (512.9) $ (1,565.1) Other comprehensive income during the period, net of adjustments 2,578.3 — 8.0 (102.7) 35.0 2,518.6 Amounts reclassified from AOCI 37.7 3.0 (19.0) 20.4 42.3 84.4 Other comprehensive income 2,616.0 3.0 (11.0) (82.3) 77.3 2,603.0 Balances as of December 31, 2019 2,806.0 (44.1) 53.4 (1,341.8) (435.6) 1,037.9 Other comprehensive income during the period, net of adjustments 1,416.7 — (13.2) (7.3) (67.0) 1,329.2 Amounts reclassified from AOCI (40.3) — (22.0) 36.2 42.1 16.0 Other comprehensive income 1,376.4 — (35.2) 28.9 (24.9) 1,345.2 Effects of implementation of accounting change related to credit losses, net (44.1) 44.1 — — — — Balances as of December 31, 2020 4,138.3 — 18.2 (1,312.9) (460.5) 2,383.1 Other comprehensive loss during the period, net of adjustments (685.2) — 53.7 (270.0) 78.0 (823.5) Amounts reclassified from AOCI 14.3 — (20.1) 19.3 37.8 51.3 Other comprehensive loss (670.9) — 33.6 (250.7) 115.8 (772.2) Balances as of December 31, 2021 $ 3,467.4 $ — $ 51.8 $ (1,563.6) $ (344.7) $ 1,610.9 (1) Net unrealized losses on available-for-sale debt securities for which an allowance for credit loss has been recorded were $2.1 million and $2.9 million as of December 31, 2021 and 2020, respectively. (2) Prior to the implementation of authoritative guidance in 2020, the noncredit component of impairment losses on fixed maturities, available-for-sale was included as a separate component of stockholders’ equity. Noncontrolling Interest Interests held by unaffiliated parties in consolidated entities are reflected in noncontrolling interest, which represents the noncontrolling partners’ share of the underlying net assets of our consolidated subsidiaries. Noncontrolling interest that is not redeemable is reported in the equity section of the consolidated statements of financial position. The noncontrolling interest holders in certain of our consolidated entities maintain an equity interest that is redeemable at the option of the holder, which may be exercised on varying dates. Since redemption of the noncontrolling interest is outside of our control, this interest is excluded from stockholders’ equity and reported separately as redeemable noncontrolling interest on the consolidated statements of financial position. Our redeemable noncontrolling interest primarily relates to consolidated sponsored investment funds for which interests are redeemed at fair value from the net assets of the funds. For our redeemable noncontrolling interest related to other consolidated subsidiaries, redemptions are required to be purchased at fair value or a value based on a formula that management intended to reasonably approximate fair value based on a fixed multiple of earnings over a measurement period. The carrying value of the redeemable noncontrolling interest is compared to the redemption value at each reporting period. Any adjustments to the carrying amount of the redeemable noncontrolling interest for changes in redemption value prior to exercise of the redemption option are determined after the attribution of net income or loss of the subsidiary and are recognized in the redemption value as they occur. Adjustments to the carrying value of redeemable noncontrolling interest result in adjustments to additional paid-in capital and/or retained earnings. Adjustments are recorded in retained earnings to the extent the redemption value of the redeemable noncontrolling interest exceeds its fair value and will impact the numerator in our earnings per share calculations. All other adjustments to the redeemable noncontrolling interest are recorded in additional paid-in capital. Following is a reconciliation of the changes in the redeemable noncontrolling interest (in millions): For the year ended December 31, 2021 2020 2019 (in millions) Beginning balance $ 255.6 $ 264.9 $ 391.2 Net income attributable to redeemable noncontrolling interest 17.5 7.5 33.6 Redeemable noncontrolling interest of deconsolidated entities (1) (37.4) (91.9) (505.4) Contributions from redeemable noncontrolling interest 166.8 136.2 402.1 Distributions to redeemable noncontrolling interest (66.8) (62.0) (66.3) Purchase of subsidiary shares from redeemable noncontrolling interest (6.1) — (1.1) Change in redemption value of redeemable noncontrolling interest 3.1 0.2 5.4 Stock-based compensation attributable to redeemable noncontrolling interest — 0.1 0.1 Other comprehensive income (loss) attributable to redeemable noncontrolling interest (0.2) 0.6 5.3 Ending balance $ 332.5 $ 255.6 $ 264.9 (1) We deconsolidated certain sponsored investment funds as they no longer met the requirements for consolidation. Dividend Limitations The declaration and payment of our common stock dividends is subject to the discretion of our Board of Directors and will depend on our overall financial condition, results of operations, capital levels, cash requirements, future prospects, receipt of dividends or other distributions from Principal Life (as described below), risk management considerations and other factors deemed relevant by the Board. No significant restrictions limit the payment of dividends by us, except those generally applicable to corporations incorporated in Delaware. Under Iowa law, Principal Life may pay dividends or make other distributions only from the earned surplus arising from its business and must receive the prior approval of the Commissioner of Insurance of the State of Iowa (“the Commissioner”) to pay stockholder dividends or make any other distribution if such distribution would exceed certain statutory limitations. Iowa law gives the Commissioner discretion to disapprove requests for distributions in excess of these limitations. Extraordinary dividends include those made, together with dividends and other distributions, within the preceding twelve months that exceed the greater of (i) 10% of Principal Life’s statutory policyholder surplus as of the previous year-end or (ii) the statutory net gain from operations from the previous calendar year, not to exceed earned surplus. Based on this limitation and 2021 statutory results, Principal Life could pay approximately $961.7 million in ordinary stockholder dividends in 2022 without prior regulatory approval. However, because the dividend test is based on dividends previously paid over rolling 12-month periods, if paid before a specified date during 2022, some or all of such dividends may be extraordinary and require regulatory approval. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Measurements | |
Fair Value Measurements | 14. Fair Value Measurements We use fair value measurements to record fair value of certain assets and liabilities and to estimate fair value of financial instruments not recorded at fair value but required to be disclosed at fair value. Certain financial instruments, particularly policyholder liabilities other than investment contracts, are excluded from these fair value disclosure requirements. Valuation Hierarchy Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price). The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three levels. The level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety considering factors specific to the asset or liability. ● Level 1 – Fair values are based on unadjusted quoted prices in active markets for identical assets or liabilities. ● Level 2 – Fair values are based on inputs other than quoted prices within Level 1 that are observable for the asset or liability, either directly or indirectly. ● Level 3 – Fair values are based on at least one significant unobservable input for the asset or liability. Determination of Fair Value The following discussion describes the valuation methodologies and inputs used for assets and liabilities measured at fair value on a recurring basis. The techniques utilized in estimating the fair value of financial instruments are reliant on the assumptions used. Care should be exercised in deriving conclusions about our business, its value or financial position based on the fair value information of financial instruments presented below. Fair value estimates are made based on available market information and judgments about the financial instrument at a specific point in time. Such estimates do not consider the tax impact of the realization of unrealized gains or losses. In addition, the disclosed fair value may not be realized in the immediate settlement of the financial instrument. We validate prices through an investment analyst review process, which includes validation through direct interaction with external sources, review of recent trade activity or use of internal models. In circumstances where broker quotes are used to value an instrument, we generally receive one non-binding quote. Broker quotes are validated through an investment analyst review process, which includes validation through direct interaction with external sources and use of internal models or other relevant information. We did not make any significant changes to our valuation processes during 2021. Fixed Maturities Fixed maturities include bonds, ABS, redeemable preferred stock and certain non-redeemable preferred securities. When available, the fair value of fixed maturities is based on quoted prices of identical assets in active markets. These are reflected in Level 1 and primarily include U.S. Treasury bonds and actively traded redeemable corporate preferred securities. When quoted prices of identical assets in active markets are not available, our first priority is to obtain prices from third party pricing vendors. We have regular interaction with these vendors to ensure we understand their pricing methodologies and to confirm they are utilizing observable market information. Their methodologies vary by asset class and include inputs such as estimated cash flows, benchmark yields, reported trades, broker quotes, credit quality, industry events and economic events. Fixed maturities with validated prices from pricing services, which includes the majority of our public fixed maturities in all asset classes, are generally reflected in Level 2. Also included in Level 2 are corporate bonds when quoted market prices are not available, for which an internal model using substantially all observable inputs or a matrix pricing valuation approach is used. In the matrix approach, securities are grouped into pricing categories that vary by sector, rating and average life. Each pricing category is assigned a risk spread based on studies of observable public market data from the investment professionals assigned to specific security classes. The expected cash flows of the security are then discounted back at the current Treasury curve plus the appropriate risk spread. Although the matrix valuation approach provides a fair valuation of each pricing category, the valuation of an individual security within each pricing category may also be impacted by company specific factors. If we are unable to price a fixed maturity security using prices from third party pricing vendors or other sources specific to the asset class, we may obtain a broker quote or utilize an internal pricing model specific to the asset utilizing relevant market information, to the extent available and where at least one significant unobservable input is utilized. These are reflected in Level 3 in the fair value hierarchy and can include fixed maturities across all asset classes. As of December 31, 2021, approximately 1% of our total fixed maturities were Level 3 securities valued using internal pricing models. The primary inputs, by asset class, for valuations of the majority of our Level 2 investments from third party pricing vendors or our internal pricing valuation approach are described below. U.S. Government and Agencies/Non-U.S. Governments States and Political Subdivisions Corporate RMBS, CMBS, Collateralized Debt Obligations and Other Debt Obligations Equity Securities Equity securities include mutual funds, common stock, non-redeemable preferred stock and required regulatory investments. Fair values of equity securities are determined using quoted prices in active markets for identical assets when available, which are reflected in Level 1. When quoted prices are not available, we may utilize internal valuation methodologies appropriate for the specific asset that use observable inputs such as underlying share prices or the NAV, which are reflected in Level 2. Fair values might also be determined using broker quotes or through the use of internal models or analysis that incorporate significant assumptions deemed appropriate given the circumstances and consistent with what other market participants would use when pricing such securities, which are reflected in Level 3. Derivatives The fair values of exchange-traded derivatives are determined through quoted market prices, which are reflected in Level 1. Exchange-traded derivatives include futures that are settled daily, which reduces their fair value in the consolidated statements of financial position. The fair values of OTC cleared derivatives are determined through market prices published by the clearinghouses, which are reflected in Level 2. The clearinghouses utilize the secured overnight financing rate (“SOFR”) curve in their valuation. Variation margin associated with OTC cleared derivatives is settled daily, which reduces their fair value in the consolidated statements of financial position. The fair values of bilateral OTC derivative instruments are determined using either pricing valuation models that utilize market observable inputs or broker quotes. The majority of our bilateral OTC derivatives are valued with models that use market observable inputs, which are reflected in Level 2. Significant inputs include contractual terms, interest rates, currency exchange rates, credit spread curves, equity prices and volatilities. These valuation models consider projected discounted cash flows, relevant swap curves and appropriate implied volatilities. Certain bilateral OTC derivatives utilize unobservable market data, primarily independent broker quotes that are nonbinding quotes based on models that do not reflect the result of market transactions, which are reflected in Level 3. Our non-cleared derivative contracts are generally documented under ISDA Master Agreements, which provide for legally enforceable set-off and close-out netting of exposures to specific counterparties. Collateral arrangements are bilateral and based on current ratings of each entity. We utilize the SOFR curve to value our positions. Counterparty credit risk is routinely monitored to ensure our adjustment for nonperformance risk is appropriate. Our centrally cleared derivative contracts are conducted with regulated centralized clearinghouses, which provide for daily exchange of cash collateral or variation margin equal to the difference in the daily market values of those contracts that eliminates the nonperformance risk on these trades. Interest Rate Contracts. Foreign Exchange Contracts. Equity Contracts. Credit Contracts. Other Investments Other investments reported at fair value include invested assets of consolidated sponsored investment funds, unconsolidated sponsored investment funds, other investment funds reported at fair value, equity method real estate investments for which the fair value option was elected and certain redeemable and nonredeemable preferred stock. In addition, in 2019 we had commercial mortgage loans of a consolidated VIE for which the fair value option was elected. Invested assets of consolidated sponsored investment funds include equity securities, fixed maturities and derivative assets, for which fair values are determined as previously described, and are reflected in Level 1 and Level 2. The fair value of unconsolidated sponsored investment funds and other investment funds is determined using the NAV of the fund. The NAV of the fund represents the price at which we would be able to initiate a transaction. Investments for which the NAV represents a quoted price in an active market for identical assets are reflected in Level 1. Investments that do not have a quoted price in an active market are reflected in Level 2. Commercial mortgage loans of a consolidated VIE were valued using the more observable fair value of the liabilities of the consolidated collateralized financing entity under the measurement alternative guidance and were reflected in Level 2. The liabilities were affiliated so were not reflected in our consolidated results. The trust was unwound in the third quarter of 2019. Equity method real estate investments for which the fair value option was elected were reflected in Level 3. The equity method real estate investments consisted of underlying real estate and debt. The real estate fair value was estimated using a discounted cash flow valuation model that utilized public real estate market data inputs such as transaction prices, market rents, vacancy levels, leasing absorption, market cap rates and discount rates. The debt fair value was estimated using a discounted cash flow analysis based on our incremental borrowing rate for similar borrowing arrangements. The last equity method real estate investment for which the fair value option was elected was sold in the third quarter of 2021. The fair value of certain redeemable and nonredeemable preferred stock is based on an internal model using unobservable inputs, which is reflected in Level 3. The redeemable preferred stock was sold in the third quarter of 2020. Cash Equivalents Certain cash equivalents are reported at fair value on a recurring basis and include money market instruments and other short-term investments with maturities of three months or less. Fair values of these cash equivalents may be determined using public quotations, when available, which are reflected in Level 1. When public quotations are not available, because of the highly liquid nature of these assets, carrying amounts may be used to approximate fair values, which are reflected in Level 2. Separate Account Assets Separate account assets include equity securities, debt securities, cash equivalents and derivative instruments, for which fair values are determined as previously described, and are reflected in Level 1, Level 2 and Level 3. Separate account assets also include commercial mortgage loans, for which the fair value is estimated by discounting the expected total cash flows using market rates that are applicable to the yield, credit quality and maturity of the loans. The market clearing spreads vary based on mortgage type, weighted average life, rating and liquidity. These are reflected in Level 3. Finally, separate account assets include real estate, for which the fair value is estimated using discounted cash flow valuation models that utilize various public real estate market data inputs. In addition, each property is appraised annually by an independent appraiser. The real estate included in separate account assets is recorded net of related mortgage encumbrances for which the fair value is estimated using discounted cash flow analysis based on our incremental borrowing rate for similar borrowing arrangements. The real estate within the separate accounts is reflected in Level 3. Investment and Universal Life Contracts Certain universal life, annuity and other investment contracts include embedded derivatives that have been bifurcated from the host contract and are measured at fair value on a recurring basis, which are reflected in Level 3. The key assumptions for calculating the fair value of the embedded derivative liabilities are market assumptions (such as equity market returns, interest rate levels, market volatility and correlations) and policyholder behavior assumptions (such as lapse, mortality, utilization and withdrawal patterns). Risk margins are included in the policyholder behavior assumptions. The assumptions are based on a combination of historical data and actuarial judgment. The embedded derivative liabilities are valued using models that incorporate a spread reflecting our own creditworthiness. The assumption for our own nonperformance risk for investment contracts and any embedded derivatives bifurcated from certain universal life, annuity and investment contracts is based on the current market credit spreads for debt-like instruments we have issued and are available in the market. Other Liabilities Derivative liabilities of consolidated sponsored investment funds are reported at fair value within other liabilities. Fair values of these derivatives are determined as previously described and are reflected in Level 2. Assets and Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis were as follows: December 31, 2021 Assets/ Amount (liabilities) measured at Fair value hierarchy level measured at net asset fair value value (4) Level 1 Level 2 Level 3 (in millions) Assets Fixed maturities, available-for-sale: U.S. government and agencies $ 2,088.6 $ — $ 1,716.5 $ 372.1 $ — Non-U.S. governments 982.0 — 0.6 981.4 — States and political subdivisions 9,304.4 — — 9,209.6 94.8 Corporate 45,944.4 — 41.5 45,068.6 834.3 Residential mortgage-backed pass-through securities 3,152.9 — — 3,152.9 — Commercial mortgage-backed securities 5,562.2 — — 5,543.0 19.2 Collateralized debt obligations (1) 3,559.6 — — 3,473.8 85.8 Other debt obligations 7,560.4 — — 7,518.3 42.1 Total fixed maturities, available-for-sale 78,154.5 — 1,758.6 75,319.7 1,076.2 Fixed maturities, trading 422.2 — 0.5 416.8 4.9 Equity securities 2,347.2 — 1,027.5 1,319.7 — Derivative assets (2) 337.1 — — 336.5 0.6 Other investments 896.2 92.7 395.3 406.1 2.1 Cash equivalents 1,117.8 — 14.2 1,103.6 — Sub-total excluding separate account assets 83,275.0 92.7 3,196.1 78,902.4 1,083.8 Separate account assets 182,345.4 8,942.9 115,261.7 57,195.5 945.3 Total assets $ 265,620.4 $ 9,035.6 $ 118,457.8 $ 136,097.9 $ 2,029.1 Liabilities Investment and universal life contracts (3) $ (356.3) $ — $ — $ — $ (356.3) Derivative liabilities (2) (226.0) — — (225.4) (0.6) Other liabilities (0.7) — — (0.7) — Total liabilities $ (583.0) $ — $ — $ (226.1) $ (356.9) Net assets $ 265,037.4 $ 9,035.6 $ 118,457.8 $ 135,871.8 $ 1,672.2 December 31, 2020 Assets/ Amount (liabilities) measured at Fair value hierarchy level measured at net asset fair value value (4) Level 1 Level 2 Level 3 (in millions) Assets Fixed maturities, available-for-sale: U.S. government and agencies $ 2,111.5 $ — $ 1,768.3 $ 343.2 $ — Non-U.S. governments 1,073.7 — 1.1 1,072.6 — States and political subdivisions 9,167.8 — — 9,167.8 — Corporate 47,354.8 — — 47,064.0 290.8 Residential mortgage-backed pass-through securities 2,986.8 — — 2,986.8 — Commercial mortgage-backed securities 4,942.3 — — 4,929.1 13.2 Collateralized debt obligations (1) 4,027.5 — — 4,000.3 27.2 Other debt obligations 7,045.9 — — 7,016.7 29.2 Total fixed maturities, available-for-sale 78,710.3 — 1,769.4 76,580.5 360.4 Fixed maturities, trading 532.1 — 0.5 531.6 — Equity securities 2,013.4 — 659.7 1,353.7 — Derivative assets (2) 463.5 — — 462.9 0.6 Other investments 746.3 75.7 252.8 385.9 31.9 Cash equivalents 1,466.4 — 38.3 1,428.1 — Sub-total excluding separate account assets 83,932.0 75.7 2,720.7 80,742.7 392.9 Separate account assets 175,951.4 155.8 102,550.5 64,351.9 8,893.2 Total assets $ 259,883.4 $ 231.5 $ 105,271.2 $ 145,094.6 $ 9,286.1 Liabilities Investment and universal life contracts (3) $ (467.8) $ — $ — $ — $ (467.8) Derivative liabilities (2) (186.1) — — (180.4) (5.7) Other liabilities (0.4) — — (0.4) — Total liabilities $ (654.3) $ — $ — $ (180.8) $ (473.5) Net assets $ 259,229.1 $ 231.5 $ 105,271.2 $ 144,913.8 $ 8,812.6 (1) Primarily consists of collateralized loan obligations backed by secured corporate loans. (2) Within the consolidated statements of financial position, derivative assets are reported with other investments and derivative liabilities are reported with other liabilities. The amounts are presented gross in the tables above to reflect the presentation on the consolidated statements of financial position; however, are presented net for purposes of the rollforward in the Changes in Level 3 Fair Value Measurements tables. Refer to Note 5, Derivative Financial Instruments, for further information on fair value by class of derivative instruments. (3) Includes bifurcated embedded derivatives that are reported at net asset (liability) fair value within the same line item in the consolidated statements of financial position in which the host contract is reported. (4) Certain investments are measured at fair value using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy. Other investments using the NAV practical expedient consist of certain fund interests that are restricted until maturity with unfunded commitments totaling $10.2 million and $15.1 million as of December 31, 2021 and December 31, 2020, respectively. Separate account assets using the NAV practical expedient consist of hedge funds and a real estate fund with varying investment strategies that also have a variety of redemption terms and conditions. We do not have unfunded commitments associated with these funds. Changes in Level 3 Fair Value Measurements The reconciliation for all assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) was as follows: For the year ended December 31, 2021 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2021 (2) income (3) (4) Level 3 Level 3 2021 (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ — $ — $ 12.8 $ (0.4) $ 82.4 $ — $ 94.8 Corporate 290.8 (21.9) 7.8 381.8 175.8 — 834.3 Commercial mortgage-backed securities 13.2 (1.0) (0.4) 7.4 — — 19.2 Collateralized debt obligations 27.2 (2.0) 1.6 420.7 74.1 (435.8) 85.8 Other debt obligations 29.2 — 0.4 16.9 20.6 (25.0) 42.1 Total fixed maturities, available-for-sale 360.4 (24.9) 22.2 826.4 352.9 (460.8) 1,076.2 Fixed maturities, trading — — — 4.9 — — 4.9 Other investments 31.9 12.5 (1.3) (41.0) — — 2.1 Separate account assets (1) 8,893.2 313.1 — (8,261.0) — — 945.3 Liabilities Investment and universal life contracts (467.8) 81.7 0.2 29.6 — — (356.3) Derivatives Net derivative assets (liabilities) (5.1) (6.9) — 12.0 — — — For the year ended December 31, 2020 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2020 (2) income (3) (4) Level 3 Level 3 2020 (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 81.7 $ (0.9) $ 5.2 $ 118.0 $ 342.0 $ (255.2) $ 290.8 Commercial mortgage-backed securities 12.9 (1.3) 1.4 (0.1) 0.3 — 13.2 Collateralized debt obligations 199.0 (2.3) (21.9) 183.0 — (330.6) 27.2 Other debt obligations 91.3 — (1.4) (37.9) 46.1 (68.9) 29.2 Total fixed maturities, available-for-sale 384.9 (4.5) (16.7) 263.0 388.4 (654.7) 360.4 Fixed maturities, trading 0.3 — — — — (0.3) — Other investments 39.0 6.3 (2.9) (10.5) — — 31.9 Separate account assets (1) 8,968.0 463.7 — (538.5) — — 8,893.2 Liabilities Investment and universal life contracts (214.2) (254.9) (0.3) 1.6 — — (467.8) Derivatives Net derivative assets (liabilities) 13.0 11.8 — (3.4) — (26.5) (5.1) For the year ended December 31, 2019 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2019 (2) income (3) (4) Level 3 Level 3 2019 (in millions) Assets Fixed maturities, available-for-sale: Non-U.S. governments $ 4.6 $ — $ — $ (4.6) $ — $ — $ — Corporate 57.9 — 2.5 17.2 4.1 — 81.7 Commercial mortgage-backed securities 9.5 (3.8) 3.4 2.4 3.7 (2.3) 12.9 Collateralized debt obligations 8.3 (2.6) 0.9 122.5 69.9 — 199.0 Other debt obligations 58.5 — 0.8 100.0 8.3 (76.3) 91.3 Total fixed maturities, available-for-sale 138.8 (6.4) 7.6 237.5 86.0 (78.6) 384.9 Fixed maturities, trading — — — 0.3 — — 0.3 Other investments 17.2 6.0 — 5.8 10.0 — 39.0 Separate account assets (1) 8,615.5 739.9 — (214.2) — (173.2) 8,968.0 Liabilities Investment and universal life contracts (45.2) (145.5) (0.2) (23.3) — — (214.2) Derivatives Net derivative assets (liabilities) 3.1 (0.8) — 10.7 — — 13.0 (1) Gains and losses for separate account assets do not impact net income as the change in value of separate account assets is offset by a change in value of separate account liabilities. Foreign currency translation adjustments related to the Principal International segment separate account assets are recorded in AOCI and are offset by foreign currency translation adjustments of the corresponding separate account liabilities. (2) Both realized gains (losses) and mark-to-market unrealized gains (losses) are generally reported in net realized capital gains (losses) within the consolidated statements of operations. Realized and unrealized gains (losses) on certain securities with an investment objective to realize economic value through mark-to-market changes are reported in net investment income within the consolidated statements of operations. Changes in unrealized gains (losses) included in net income relating to positions still held were : For the year ended December 31, 2021 2020 2019 (in millions) Assets Fixed maturities, available-for-sale: Corporate $ (4.6) $ — $ — Commercial mortgage-backed securities (1.0) (1.2) (2.9) Collateralized debt obligations (2.0) (2.2) (2.6) Total fixed maturities, available-for-sale (7.6) (3.4) (5.5) Other investments 12.5 5.3 6.0 Separate account assets 90.5 385.5 697.1 Liabilities Investment and universal life contracts 80.3 (262.1) (146.0) Derivatives Net derivative assets (liabilities) (0.6) 9.9 5.3 (3) Changes in unrealized gains (losses) included in OCI, including foreign currency translation adjustments related to our Principal International segment, relating to positions still held were : For the year ended December 31, 2021 2020 (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ 12.8 $ — Corporate (0.7) 11.9 Commercial mortgage-backed securities (0.4) 1.5 Collateralized debt obligations 1.9 (0.3) Total fixed maturities, available-for-sale 13.6 13.1 Other investments (1.3) (2.9) Liabilities Investment and universal life contracts 0.2 (0.3) (4) Gross purchases, sales, issuances and settlements were: For the year ended December 31, 2021 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ — $ — $ — $ (0.4) $ (0.4) Corporate 626.6 (84.3) — (160.5) 381.8 Commercial mortgage-backed securities 7.7 — — (0.3) 7.4 Collateralized debt obligations 446.0 — — (25.3) 420.7 Other debt obligations 45.1 — — (28.2) 16.9 Total fixed maturities, available-for-sale 1,125.4 (84.3) — (214.7) 826.4 Fixed maturities, trading 4.9 — — — 4.9 Other investments — (41.0) — — (41.0) Separate account assets (5) 38.5 (8,206.2) (191.5) 98.2 (8,261.0) Liabilities Investment and universal life contracts — — (16.4) 46.0 29.6 Derivatives Net derivative assets (liabilities) — 12.0 — — 12.0 For the year ended December 31, 2020 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 169.2 $ (5.5) $ — $ (45.7) $ 118.0 Commercial mortgage-backed securities — — — (0.1) (0.1) Collateralized debt obligations 182.5 — — 0.5 183.0 Other debt obligations 14.3 — — (52.2) (37.9) Total fixed maturities, available-for-sale 366.0 (5.5) — (97.5) 263.0 Other investments 0.5 (11.0) — — (10.5) Separate account assets (5) 309.2 (658.2) (396.1) 206.6 (538.5) Liabilities Investment and universal life contracts — — (23.0) 24.6 1.6 Derivatives Net derivative assets (liabilities) — (3.4) — — (3.4) For the year ended December 31, 2019 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: Non-U.S. governments $ — $ — $ — $ (4.6) $ (4.6) Corporate 41.9 (1.4) — (23.3) 17.2 Commercial mortgage-backed securities 2.4 — — — 2.4 Collateralized debt obligations 124.7 — — (2.2) 122.5 Other debt obligations 107.7 — — (7.7) 100.0 Total fixed maturities, available-for-sale 276.7 (1.4) — (37.8) 237.5 Fixed maturities, trading 0.5 — — (0.2) 0.3 Other investments 10.7 (4.9) — — 5.8 Separate account assets (5) 279.1 (526.4) (280.4) 313.5 (214.2) Liabilities Investment and universal life contracts — — (33.4) 10.1 (23.3) Derivatives Net derivative assets (liabilities) 1.9 8.8 — — 10.7 (5) Issuances and settlements include amounts related to mortgage encumbrances associated with real estate in our separate accounts. Transfers Transfers of assets and liabilities measured at fair value on a recurring basis between fair value hierarchy levels were as follows: For the year ended December 31, 2021 Transfers out Transfers out Transfers out Transfers out of Level 1 into of Level 2 into of Level 3 into of Level 3 into Level 3 Level 3 Level 1 Level 2 (in millions) Assets Fixed maturities, available-for-sale: State and political subdivisions $ — $ 82.4 $ — $ — Corporate — 175.8 — — Collateralized debt obligations — 74.1 — 435.8 Other debt obligations — 20.6 — 25.0 Total fixed maturities, available-for-sale — 352.9 — 460.8 For the year ended December 31, 2020 Transfers out Transfers out Transfers out Transfers out of Level 1 into of Level 2 into |
Statutory Insurance Financial I
Statutory Insurance Financial Information | 12 Months Ended |
Dec. 31, 2021 | |
Statutory Insurance Financial Information | |
Statutory Insurance Financial Information | 15. Statutory Insurance Financial Information Principal Life, the largest indirect subsidiary of PFG, prepares statutory financial statements in accordance with the accounting practices prescribed or permitted by the Insurance Division of the Department of Commerce of the State of Iowa (the “Iowa Insurance Division”). The Iowa Insurance Division recognizes only statutory accounting practices prescribed or permitted by the State of Iowa for determining and reporting the financial condition and results of operations of an insurance company to determine its solvency under the Iowa Insurance Law. The National Association of Insurance Commissioners’ (“NAIC”) Accounting Practices and Procedures Manual has been adopted as a component of prescribed practices by the State of Iowa. The Commissioner has the right to permit other specific practices that deviate from prescribed practices. Statutory accounting practices differ from U.S. GAAP primarily due to charging policy acquisition costs to expense as incurred, establishing reserves using different actuarial assumptions, valuing investments on a different basis and not admitting certain assets, including certain net deferred income tax assets. Principal Life cedes certain term and universal life insurance statutory reserves to our affiliated reinsurance subsidiaries on a funds withheld coinsurance basis. The reserves are secured by cash, invested assets and financing provided by highly rated third parties. As of December 31, 2021 and 2020, our affiliated reinsurance subsidiaries assumed statutory reserves of $10,085.7 million and $8,978.2 million from Principal Life, respectively. In the states of Vermont and Delaware, the affiliated reinsurers had permitted and prescribed practices allowing for the admissibility of certain assets backing these reserves. As of December 31, 2021 and 2020, assets admitted under these practices totaled $4,146.0 million and $3,731.0 million, respectively. Life and health insurance companies are subject to certain risk-based capital (“RBC”) requirements as specified by the NAIC. Under those requirements, the amount of capital and surplus maintained by a life and health insurance company is to be determined based on the various risk factors related to it. As of December 31, 2021, Principal Life met the minimum RBC requirements. Statutory net income and statutory capital and surplus of Principal Life were as follows: As of or for the year ended December 31, 2021 2020 2019 (in millions) Statutory net income $ 864.0 $ 915.9 $ 989.3 Statutory capital and surplus 5,375.2 5,682.4 5,193.4 |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Segment Information | 16. Segment Information We provide financial products and services through the following segments: Retirement and Income Solutions, Principal Global Investors, Principal International and U.S. Insurance Solutions. In addition, we have a Corporate segment. The segments are managed and reported separately because they provide different products and services, have different strategies or have different markets and distribution channels. The Retirement and Income Solutions segment provides retirement and related financial products and services primarily to businesses, their employees and other individuals. The segment is organized into Retirement and Income Solutions – Fee, which includes full service accumulation, trust services, individual variable annuities, the pieces of the Institutional Retirement & Trust (“IRT”) business of Wells Fargo Bank, N.A. (“Acquired Business”) that have not yet migrated to Principal (migration of retirement business completed in the second quarter of 2021; remaining migration to be completed in early 2022) and acquisition, integration and migration expenses associated with the purchase of the Acquired Business; and Retirement and Income Solutions – Spread, which includes individual fixed annuities, investment only, pension risk transfer and banking services. The Principal Global Investors segment provides asset management services to our asset accumulation business, our insurance operations, the Corporate segment and third party clients. This segment also includes our mutual fund business. The Principal International segment has operations in Latin America (Brazil, Chile and Mexico) and Asia (China, Hong Kong Special Administrative Region, India and Southeast Asia). We focus on locations with large middle classes, favorable demographics and growing long-term savings, ideally with voluntary or mandatory pension markets. We entered these locations through acquisitions, start-up operations and joint ventures. The U.S. Insurance Solutions segment focuses on solutions for small-to-medium sized businesses and their employees. The segment is organized into Specialty Benefits insurance, which provides group dental and vision insurance, individual and group disability insurance, critical illness, accident, group life insurance and non-medical fee-for-service claims administration; and Individual Life insurance, which provides universal life, variable universal life, indexed universal life and traditional life insurance. Our Corporate segment manages the assets representing capital that has not been allocated to any other segment. Financial results of the Corporate segment primarily reflect our financing activities (including financing costs), income on capital not allocated to other segments, inter-segment eliminations, income tax risks and certain income, expenses and other adjustments not allocated to the segments based on the nature of such items. Results of Principal Securities, Inc. (“PSI”), our retail broker-dealer and registered investment advisor (“RIA”); RobustWealth, our financial technology company; and our exited group medical and long-term care insurance businesses are reported in this segment. Management uses segment pre-tax operating earnings in evaluating performance, which is consistent with the financial results provided to and discussed with securities analysts. We determine segment pre-tax operating earnings by adjusting U.S. GAAP income before income taxes for pre-tax net realized capital gains (losses), as adjusted, pre-tax other adjustments that management believes are not indicative of overall operating trends and certain adjustments related to equity method investments and noncontrolling interest. While these items may be significant components in understanding and assessing the consolidated financial performance, management believes the presentation of pre-tax operating earnings enhances the understanding of our results of operations by highlighting pre-tax earnings attributable to the normal, ongoing operations of the business. The pre-tax net realized capital gains (losses), as adjusted, excluded from pre-tax operating earnings reflects consolidated U.S. GAAP pre-tax net realized capital gains (losses) excluding the following items that are included in pre-tax operating earnings: ● Periodic settlements and accruals on derivative instruments not designated as hedging instruments, ● Certain market value adjustments of derivatives and embedded derivatives and ● Certain market value adjustments of derivative instruments used to economically hedge embedded derivatives. Pre-tax net realized capital gains (losses), as adjusted, are further adjusted for: ● Amortization of hedge accounting book value adjustments for certain discontinued hedges, ● Certain hedge accounting market value revenue adjustments, ● Certain market value adjustments to fee revenues, ● Pre-tax net realized capital gains (losses) adjustments related to equity method investments, ● Pre-tax net realized capital gains (losses) adjustments related to sponsored investment funds, ● Recognition of deferred front-end fee revenues for sales charges on retirement and life insurance products and services, ● Related changes in the amortization pattern of DAC and related actuarial balances, ● Certain hedge accounting market value expense adjustments and ● Net realized capital gains (losses) distributed. Segment operating revenues reflect consolidated U.S. GAAP total revenues excluding: ● Net realized capital gains (losses), except periodic settlements and accruals on derivatives not designated as hedging instruments and certain market value adjustments of derivative instruments used to economically hedge embedded derivatives, and their impact on: ● Amortization of hedge accounting book value adjustments for certain discontinued hedges, ● Certain hedge accounting market value revenue adjustments, ● Certain market value adjustments to fee revenues, ● Pre-tax net realized capital gains (losses) adjustments related to equity method investments, ● Pre-tax net realized capital gains (losses) adjustments related to sponsored investment funds and ● Recognition of deferred front-end fee revenues for sales charges on retirement and life insurance products and services. ● Pre-tax other adjustments and income taxes of equity method investments and ● Pre-tax other adjustments management believes are not indicative of overall operating trends. The accounting policies of the segments are consistent with the accounting policies for the consolidated financial statements, with the exception of: (1) pension and OPEB cost allocations, (2) certain expenses deemed to benefit the entire organization and (3) income tax allocations. For purposes of determining pre-tax operating earnings, the segments are allocated the service component of pension and other postretirement benefit costs. The Corporate segment reflects the non-service components of pension and other postretirement benefit costs as assumptions are established and funding decisions are managed from a company-wide perspective. Additionally, the Corporate segment reflects expenses that benefit the entire organization for which the segments are not able to influence the spend. This includes expenses such as public company costs, executive management costs, acquisition and disposition costs, among others. The Corporate segment functions to absorb the risk inherent in interpreting and applying tax law. For purposes of determining non-GAAP operating earnings, the segments are allocated tax adjustments consistent with the positions we took on tax returns. The Corporate segment results reflect any differences between the tax returns and the estimated resolution of any disputes. The following tables summarize select financial information by segment, including operating revenues for our products and services, and reconcile segment totals to those reported in the consolidated financial statements: December 31, 2021 December 31, 2020 (in millions) Assets: Retirement and Income Solutions $ 221,993.8 $ 207,288.4 Principal Global Investors 2,445.1 2,294.3 Principal International 42,812.4 51,707.6 U.S. Insurance Solutions 33,222.6 31,438.9 Corporate 4,183.3 3,898.5 Total consolidated assets $ 304,657.2 $ 296,627.7 For the year ended December 31, 2021 2020 2019 (in millions) Operating revenues by segment: Retirement and Income Solutions: Retirement and Income Solutions – Fee $ 2,322.7 $ 2,149.8 $ 2,003.0 Retirement and Income Solutions – Spread 4,187.3 5,353.7 6,951.4 Total Retirement and Income Solutions (1) 6,510.0 7,503.5 8,954.4 Principal Global Investors (2) 1,828.0 1,539.1 1,505.8 Principal International 1,351.8 1,096.8 1,523.2 U.S. Insurance Solutions: Specialty Benefits insurance 2,709.6 2,525.4 2,493.6 Individual Life insurance 2,057.2 1,955.0 1,955.6 Eliminations (0.2) (0.2) (0.2) Total U.S. Insurance Solutions 4,766.6 4,480.2 4,449.0 Corporate 1.8 (39.7) (39.3) Total segment operating revenues 14,458.2 14,579.9 16,393.1 Net realized capital gains (losses), net of related revenue adjustments (164.0) 195.3 (98.5) Adjustments related to equity method investments (31.5) (33.5) (72.5) Total revenues per consolidated statements of operations $ 14,262.7 $ 14,741.7 $ 16,222.1 Pre-tax operating earnings (losses) by segment: Retirement and Income Solutions $ 1,141.2 $ 966.9 $ 874.0 Principal Global Investors 708.4 512.9 483.3 Principal International 309.0 243.6 390.7 U.S. Insurance Solutions 470.8 239.9 521.6 Corporate (368.0) (326.4) (380.3) Total segment pre-tax operating earnings 2,261.4 1,636.9 1,889.3 Pre-tax net realized capital gains (losses), as adjusted (3) (179.8) 63.6 (140.9) Adjustments related to equity method investments and noncontrolling interest 2.0 (7.0) (55.1) Income before income taxes per consolidated statements of operations $ 2,083.6 $ 1,693.5 $ 1,693.3 (1) Reflects inter-segment revenues of $413.1 million, $342.6 million and $357.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. (2) Reflects inter-segment revenues of $308.9 million, $273.8 million and $264.9 million for the years ended December 31, 2021, 2020 and 2019, respectively. (3) Pre-tax net realized capital gains (losses), as adjusted, is derived as follows: For the year ended December 31, 2021 2020 2019 (in millions) Net realized capital gains (losses) $ 2.5 $ 302.6 $ (52.8) Derivative and hedging-related revenue adjustments (160.3) (132.9) (80.4) Market value adjustments to fee revenues (0.6) (1.6) — Adjustments related to equity method investments (24.0) (1.5) 2.6 Adjustments related to sponsored investment funds 21.3 17.3 23.6 Recognition of front-end fee revenue (2.9) 11.4 8.5 Net realized capital gains (losses), net of related revenue adjustments (164.0) 195.3 (98.5) Amortization of deferred acquisition costs and other actuarial balances 11.1 (26.8) (40.8) Capital gains distributed (106.7) (49.9) (68.2) Market value adjustments of embedded derivatives 79.8 (55.0) 66.6 Pre-tax net realized capital gains (losses), as adjusted (a) $ (179.8) $ 63.6 $ (140.9) (a) As adjusted before noncontrolling interest capital gains (losses). The following is a summary of income tax expense (benefit) allocated to our segments for purposes of determining non-GAAP operating earnings. Segment income taxes are reconciled to income taxes reported on our consolidated statements of operations. For the year ended December 31, 2021 2020 2019 (in millions) Income tax expense (benefit) by segment: Retirement and Income Solutions $ 130.1 $ 106.6 $ 71.8 Principal Global Investors 192.3 141.9 121.8 Principal International 69.8 62.0 106.8 U.S. Insurance Solutions 92.3 47.9 101.8 Corporate (70.7) (87.9) (82.0) Total segment income taxes from operating earnings 413.8 270.5 320.2 Tax expense (benefit) related to net realized capital losses, as adjusted (56.2) 28.2 1.3 Certain adjustments related to equity method investments and noncontrolling interest (31.4) (33.7) (72.3) Total income taxes per consolidated statements of operations $ 326.2 $ 265.0 $ 249.2 The following is a summary of depreciation and amortization expense allocated to our segments for purposes of determining pre-tax operating earnings. Segment depreciation and amortization is reconciled to depreciation and amortization included in operating expenses in our consolidated statements of operations. For the year ended December 31, 2021 2020 2019 (in millions) Depreciation and amortization expense by segment: Retirement and Income Solutions $ 81.7 $ 69.1 $ 48.2 Principal Global Investors 21.1 21.6 18.9 Principal International 57.3 56.0 58.6 U.S. Insurance Solutions 24.2 25.1 25.0 Corporate 23.7 14.8 16.1 Total depreciation and amortization expense included in our consolidated statements of operations $ 208.0 $ 186.6 $ 166.8 |
Revenues from Contracts with Cu
Revenues from Contracts with Customers | 12 Months Ended |
Dec. 31, 2021 | |
Revenues from Contracts with Customers | |
Revenues from Contracts with Customers | 17. Revenues from Contracts with Customers The following tables summarize disaggregation of revenues from contracts with customers, including select financial information by segment, and reconcile totals to those reported in the consolidated financial statements. Revenues from contracts with customers are included in fees and other revenues on the consolidated statements of operations. For the year ended December 31, 2021 2020 2019 (in millions) Revenue from contracts with customers by segment: Retirement and Income Solutions: Retirement and Income Solutions – Fee $ 580.2 $ 591.2 $ 455.5 Retirement and Income Solutions – Spread 9.9 8.6 9.3 Total Retirement and Income Solutions 590.1 599.8 464.8 Principal Global Investors 1,787.9 1,511.2 1,456.7 Principal International 492.7 439.2 462.2 U.S. Insurance Solutions: Specialty Benefits insurance 14.9 14.8 14.9 Individual Life insurance 60.6 48.6 51.2 Eliminations (0.2) (0.2) (0.2) Total U.S. Insurance Solutions 75.3 63.2 65.9 Corporate 204.1 154.9 160.4 Total segment revenue from contracts with customers 3,150.1 2,768.3 2,610.0 Adjustments for fees and other revenues not within the scope of revenue recognition guidance (1) 1,866.0 1,733.0 1,791.4 Pre-tax other adjustments (2) (3.5) 9.8 8.5 Total fees and other revenues per consolidated statements of operations $ 5,012.6 $ 4,511.1 $ 4,409.9 (1) Fees and other revenues not within the scope of the revenue recognition guidance primarily represent revenue on contracts accounted for under the financial instruments or insurance contracts standards. (2) Pre-tax other adjustments relate to the recognition of deferred front-end fee revenues for sales charges on retirement and life insurance products and certain market value adjustments to fee revenues. Retirement and Income Solutions - Fee Retirement and Income Solutions - Fee offers service and trust agreements for defined contribution retirement plans, including 401(k) plans, 403(b) plans, and employee stock ownership plans. The investment components of these service agreements are in the form of mutual fund offerings. In addition, plan sponsor retirement plan trust and custody services are also available through an affiliated trust company. With the Acquired Business, services and trust agreements are also offered to non-retirement customers including insurance companies, endowments and other financial institutions. Fees and other revenues are earned for administrative activities performed for the defined contribution retirement plans including recordkeeping and reporting as well as trust and custody, asset management and investment services. Fees and other revenues are earned for administrative activities performed for non-retirement plan customers including trust and custody services, defined benefit administration and investment management activities. The majority of these activities are performed daily over time. Fee-for-service transactions are also provided upon client request. These services are considered distinct or grouped into a bundle until a distinct performance obligation is identified. Some performance obligations are considered a series of distinct services, which are substantially the same and have the same pattern of transfer to the customer. Fees and other revenues can be based on a fixed contractual rate for these services or can be variable based upon contractual rates applied to the market value of the client’s investment portfolio each day. If the consideration for this series of performance obligations is based on daily market value, it is considered variable each day as the services are performed over time. The consideration becomes unconstrained and thus recognized as revenue for each day’s series of distinct services once the market value of the clients’ investment portfolios is determined at market close or carried over at the end of the day for days when the market is closed. Additionally, fixed fees and other revenues are recognized point-in-time as fee-for-service transactions upon completion. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Administrative service fee revenue $ 576.7 $ 589.2 $ 453.7 Other fee revenue 3.5 2.0 1.8 Total revenues from contracts with customers 580.2 591.2 455.5 Fees and other revenues not within the scope of revenue recognition guidance 1,299.6 1,130.4 1,139.0 Total fees and other revenues 1,879.8 1,721.6 1,594.5 Premiums and other considerations 0.5 5.0 3.5 Net investment income 442.4 423.2 405.0 Total operating revenues $ 2,322.7 $ 2,149.8 $ 2,003.0 Retirement and Income Solutions - Spread Retirement and Income Solutions – Spread offers individual retirement accounts (“IRAs”) through Principal Bank, which are primarily funded by retirement savings rolled over from qualified retirement plans. The IRAs are held in savings accounts, money market accounts and certificates of deposit. Revenues are earned through fees as the performance of establishing and maintaining IRA accounts is completed. Fee-for-service transactions are also provided upon client request. The establishment fees and annual maintenance fees are accrued into earnings over a period of time using the average account life. Upfront and recurring bank fees are related to performance obligations that have the same pattern of transfer to the customer and are recognized in income over time with control transferred to the customers utilizing the output method. These fees are based on a fixed contractual rate. Fixed fees and other revenues are also recognized point-in-time as fee-for-service transactions upon completion. Additionally, commission income is earned on advisory services provided to customers. The revenues are earned over time as the service is performed based upon contractual rates applied to the market value of the clients’ portfolios. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Deposit account fee revenue $ 9.2 $ 8.4 $ 9.3 Commission income 0.7 0.2 — Total revenues from contracts with customers 9.9 8.6 9.3 Fees and other revenues not within the scope of revenue recognition guidance 7.9 9.5 13.9 Total fees and other revenues 17.8 18.1 23.2 Premiums and other considerations 1,883.1 3,216.0 4,859.2 Net investment income 2,286.4 2,119.6 2,069.0 Total operating revenues $ 4,187.3 $ 5,353.7 $ 6,951.4 Principal Global Investors Fees and other revenues earned for asset management, investment advisory and distribution services provided to institutional and retail clients are based largely upon contractual rates applied to the specified amounts of the clients’ portfolios. Each service is a distinct performance obligation, or a series of distinct services that are a single performance obligation in that the services are substantially the same and have the same pattern of transfer to the customer. Fees and other revenues received for performance obligations such as asset management and other services are typically recognized over time utilizing the output method as the service is performed. Performance fees and transaction fees on certain accounts are recognized in income when the probability of significant reversal will not occur upon resolution of the uncertainty, which could be based on a variety of factors such as market performance or other internal metrics. Asset management fees are accrued each month based on the fee terms within the applicable agreement and are generally billed quarterly when values used for the calculation are available. Management fees and performance fees are variable consideration as they are subject to fluctuation based on assets under management (“AUM”) and other constraints. These fees are not recognized until unconstrained at the end of each reporting period. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Management fee revenue $ 1,514.1 $ 1,298.4 $ 1,239.1 Other fee revenue 273.8 212.8 217.6 Total revenues from contracts with customers 1,787.9 1,511.2 1,456.7 Fees and other revenues not within the scope of revenue recognition guidance 36.2 22.3 38.5 Total fees and other revenues 1,824.1 1,533.5 1,495.2 Net investment income 3.9 5.6 10.6 Total operating revenues $ 1,828.0 $ 1,539.1 $ 1,505.8 Principal International Fees and other revenues are earned for asset management and distribution services provided to retail and institutional clients in addition to trustee and/or administrative services performed for retirement savings plans. Each service is considered a distinct performance obligation; however, if the services are not distinct on their own, we combine them into a distinct bundle or we have a series of distinct services that are substantially the same and have the same pattern of transfer to the customer. Fees and other revenues are typically based upon contractual rates applied to the market value of the clients’ investment portfolios and are considered variable consideration. The transaction price generally includes the amount determined at the end of the reporting period, whereby fees are deducted from the clients’ investment portfolios and are recognized as revenue when no longer constrained and satisfied as the services are performed over time utilizing the output method. In addition, payments to customers can take the form of an incentive given by us to entice the customer to purchase its goods or services. Incentives offered to customers are recognized as part of the transaction price as a reduction of revenue either over the period the customer remains in order to receive the incentive or monthly throughout the life of the contract. Incentive-based fees are recognized in income when the probability of significant reversal will not occur upon the resolution of the uncertainty, which is based on market performance. Fees for managing customers’ mandatory retirement savings accounts in Chile are collected with each monthly deposit made by our customers. If a customer stops contributing before retirement age, we collect no fees but services are still provided. We recognize revenue from these contracts as services are performed over the life of the contract and review annually. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Management fee revenue $ 484.4 $ 435.3 $ 459.3 Other fee revenue 8.3 3.9 2.9 Total revenues from contracts with customers 492.7 439.2 462.2 Fees and other revenues not within the scope of revenue recognition guidance 4.1 5.6 6.3 Total fees and other revenues 496.8 444.8 468.5 Premiums and other considerations 127.5 156.6 393.3 Net investment income 727.5 495.4 661.4 Total operating revenues $ 1,351.8 $ 1,096.8 $ 1,523.2 Revenues from contracts with customers by region: Latin America $ 362.6 $ 323.5 $ 351.5 Asia 128.8 115.9 111.0 Principal International corporate / regional offices 2.6 0.9 0.9 Eliminations (1.3) (1.1) (1.2) Total revenues from contracts with customers $ 492.7 $ 439.2 $ 462.2 U.S. Insurance Solutions Fees and other revenues are earned for administrative services performed including recordkeeping and reporting services for fee-for-service products, nonqualified benefit plans, separate accounts and dental networks. Services within contracts are not distinct on their own; however, we combine the services into a distinct bundle and account for the bundle as a single performance obligation, which is satisfied over time utilizing the output method as services are rendered. The transaction price corresponds with the performance completed to date, for which the value is recognized as revenue during the period. Variability of consideration is resolved at the end of each period and payments are due when billed. Commission income is earned through sponsored brokerage services. Performance obligations are satisfied at a point in time, upon delivery of a placed case, and the transaction price calculated per the compensation schedule is recognized as revenue. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Specialty Benefits insurance: Administrative service fees $ 14.9 $ 14.8 $ 14.9 Total revenues from contracts with customers 14.9 14.8 14.9 Fees and other revenues not within the scope of revenue recognition guidance 19.0 19.3 19.6 Total fees and other revenues 33.9 34.1 34.5 Premiums and other considerations 2,496.4 2,330.7 2,292.7 Net investment income 179.3 160.6 166.4 Total operating revenues $ 2,709.6 $ 2,525.4 $ 2,493.6 Individual Life insurance: Administrative service fees $ 26.7 $ 21.8 $ 24.3 Commission income 33.9 26.8 26.9 Total revenues from contracts with customers 60.6 48.6 51.2 Fees and other revenues not within the scope of revenue recognition guidance 859.2 849.8 875.9 Total fees and other revenues 919.8 898.4 927.1 Premiums and other considerations 334.0 329.1 317.9 Net investment income 803.4 727.5 710.6 Total operating revenues $ 2,057.2 $ 1,955.0 $ 1,955.6 Corporate Fees and other revenues are earned on the performance of selling and servicing of securities and related products offered through PSI, an introducing broker-dealer registered with the FINRA. PSI enters into selling and distribution agreements with the obligation to sell or distribute the securities products, such as mutual funds, annuities and products sold through RIAs, to individual clients in return for front-end sales charges, 12b-1 service fees, annuity fees and asset-based fees. Front-end sales charges, 12b-1 fees and annuity fees are related to a single sale and are earned at the time of sale. PSI also enters into agreements with individual customers to provide securities trade execution and custody through a brokerage services platform in return for ticket charge and other service fee revenue. These services are bundled as one single distinct service referred to as brokerage services. This revenue is related to distinct transactions and is earned at a point in time. PSI also enters into agreements with individual customers to provide trade execution, clearing services, custody services and investment research services through our proprietary offered fee-based products. These services are bundled as one single distinct service referred to as advisory services. In addition, for outside RIA business PSI performs sales and distribution services only. The revenues are earned over time as the service is performed utilizing the output method. A majority of our revenue is based upon contractual rates applied to the market value of the clients’ portfolios and considered variable consideration. The Corporate segment also includes inter-segment eliminations of fees and other revenues. The types of revenues from contracts with customers were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Commission income $ 388.9 $ 316.6 $ 320.2 Other fee revenue 68.8 59.1 46.1 Eliminations (253.6) (220.8) (205.9) Total revenues from contracts with customers 204.1 154.9 160.4 Fees and other revenues not within the scope of revenue recognition guidance (360.0) (303.9) (301.8) Total fees and other revenues (155.9) (149.0) (141.4) Net investment income 157.7 109.3 102.1 Total operating revenues $ 1.8 $ (39.7) $ (39.3) Contract Costs Sales compensation and other incremental costs of obtaining a contract are capitalized and amortized over the period of contract benefit if the costs are expected to be recovered. The contract cost asset, which is included in other assets on the consolidated statements of financial position, was $193.1 million and $173.0 million as of December 31, 2021 and December 31, 2020, respectively. We apply the practical expedient for certain costs where we recognize the incremental costs of obtaining these contracts as an expense when incurred if the amortization period of the assets is one year or less. These costs, along with costs that are not deferrable, are included in operating expenses on the consolidated statements of operations. Deferred contract costs consist primarily of commissions and variable compensation. We amortize capitalized contract costs on a straight-line basis over the expected contract life, reflecting lapses as they are incurred. Deferred contract costs are subject to impairment testing on an annual basis, or when a triggering event occurs that could warrant an impairment. To the extent future revenues less future maintenance expenses are not adequate to cover the asset balance, an impairment is recognized. For the years ended December 31, 2021, 2020 and 2019, $32.4 million, $24.8 million and $24.4 million, respectively, of amortization expense was recorded in operating expenses on the consolidated statements of operations and no impairment loss was recognized in relation to the costs capitalized. |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2021 | |
Stock-Based Compensation Plans | |
Stock-Based Compensation Plans | 18. Stock-Based Compensation Plans As of December 31, 2021, we had the 2021 Stock Incentive Plan, the 2020 Directors Stock Plan, the 2014 Stock Incentive Plan, the Employee Stock Purchase Plan, the 2014 Directors Stock Plan, the Amended and Restated 2010 Stock Incentive Plan, the 2005 Directors Stock Plan, the Stock Incentive Plan and the Directors Stock Plan (“Stock-Based Compensation Plans”). No new grants will be made under the 2020 Directors Stock Plan, the 2014 Stock Incentive Plan, the 2014 Directors Stock Plan, the Amended and Restated 2010 Stock Incentive Plan, the 2005 Directors Stock Plan, the Stock Incentive Plan or the Directors Stock Plan. Under the terms of the 2021 Stock Incentive Plan grants may be nonqualified stock options, incentive stock options qualifying under Section 422 of the Internal Revenue Code, restricted stock, restricted stock units, stock appreciation rights, performance shares, performance units or other stock-based awards. To date, we have not granted any incentive stock options, restricted stock or performance units under any plans. As part of our fair value process, for each stock-based compensation plan, we assess the impact of material nonpublic information on our share price or expected volatility, as applicable, at the time of grant. No awards in 2021 required a fair value adjustment. As of December 31, 2021, the maximum number of new shares of common stock available for grant under the 2021 Stock Incentive Plan was 24.4 million. For awards with graded vesting, we use an accelerated expense attribution method. The compensation cost that was charged against net income for stock-based awards granted under the Stock-Based Compensation Plans was as follows: For the year ended December 31, 2021 2020 2019 (in millions) Compensation cost $ 95.2 $ 86.7 $ 78.7 Related income tax benefit 19.9 17.1 16.8 Capitalized as part of an asset 1.4 1.5 1.7 Nonqualified Stock Options Nonqualified stock options were granted to certain employees under the 2014 Stock Incentive Plan, the Amended and Restated 2010 Stock Incentive Plan and the Stock Incentive Plan. Options outstanding were granted at an exercise price equal to the fair market value of our common stock on the date of grant and expire ten years after the grant date. These options have graded vesting over a three-year period, except in the case of specific types of terminations. Total options granted were 0.8 million, 1.4 million and 1.2 million during 2021, 2020 and 2019, respectively. The following is a summary of the status of all of our stock option plans: Weighted- average Number of options exercise price Intrinsic value (in millions) (in millions) Options outstanding as of January 1, 2021 6.5 $ 49.52 Granted 0.8 58.68 Exercised 1.0 41.92 Canceled 0.1 56.93 Options outstanding as of December 31, 2021 6.2 $ 51.89 $ 126.9 Options vested or expected to vest as of December 31, 2021 6.2 $ 51.88 $ 126.7 Options exercisable as of December 31, 2021 4.6 $ 50.76 $ 99.2 The total intrinsic value of stock options exercised was $23.5 million, $3.4 million and $2.4 million during 2021, 2020, and 2019, respectively. The following is a summary of weighted-average remaining contractual lives for stock options outstanding and the range of exercise prices on the stock options as of December 31, 2021: Weighted- Number of options average remaining Range of exercise prices outstanding contractual life (in millions) $27.46 - $48.11 1.4 2.5 $48.12 - $52.41 1.6 7.0 $52.42 - $55.89 1.1 7.2 $55.90 - $62.75 0.8 9.1 $62.76 - $63.98 1.3 5.7 $27.46 - $63.98 6.2 The weighted-average remaining contractual lives for stock options exercisable is approximately 6.0 years as of December 31, 2021. The fair value of stock options is estimated using the Black-Scholes option pricing model. The following is a summary of the assumptions used in this model for the stock options granted during the period: For the year ended December 31, Options 2021 2020 2019 Expected volatility 34.2 % 25.7 % 23.3 % Expected term (in years) 7.0 7.0 7.0 Risk-free interest rate 1.2 % 1.3 % 2.6 % Expected dividend yield 3.82 % 4.33 % 4.07 % Weighted average estimated fair value $ 15.67 $ 9.64 $ 10.00 We determine expected volatility based on a combination of historical volatility using daily price observations and implied volatility from traded options on our common stock. We believe that incorporating both historical and implied volatility into our expected volatility assumption calculation better reflects market expectations. The expected term represents the period of time that options granted are expected to be outstanding. We determine expected term using historical exercise and employee termination data. The risk-free rate for periods within the expected term of the option is based on the U.S. Treasury risk-free interest rate in effect at the time of grant. The dividend yield is based on historical dividend distributions compared to the closing price of our common shares on the grant date. As of December 31, 2021, we had $3.0 million of total unrecognized compensation cost related to nonvested stock options. The cost is expected to be recognized over a weighted-average service period of approximately 1.8 years. Cash received from stock options exercised under these share-based payment arrangements during 2021, 2020 and 2019 was $42.2 million, $4.4 million and $3.4 million, respectively. The actual tax benefits realized for the tax deductions for options exercised under these share-based payment arrangements during 2021, 2020 and 2019 was $9.1 million, $1.4 million and $0.5 million, respectively. Performance Share Awards We granted performance share awards to certain employees under the 2014 Stock Incentive Plan and the Amended and Restated 2010 Stock Incentive Plan. The performance share awards are treated as an equity award and are paid in shares. Whether the performance shares are earned depends upon the participant’s continued employment through the performance period (except in the case of specific types of terminations) and our performance against three-year goals set at the beginning of the performance period. Performance goals based on various factors must be achieved for any of the performance shares to be earned. If the performance requirements are not met, the performance shares will be forfeited, no compensation cost will be recognized and any previously recognized compensation cost will be reversed. These awards have no maximum contractual term. Dividend equivalents are credited on performance shares outstanding as of the record date. These dividend equivalents are only paid on the shares released. Total performance share awards granted were 0.2 million, 0.3 million and 0.2 million in 2021, 2020 and 2019, respectively. The following is a summary of activity for the nonvested performance share awards: Number of Weighted- performance average grant-date share awards fair value (in millions) Nonvested performance share awards as of January 1, 2021 0.7 $ 55.28 Granted 0.2 58.68 Vested 0.1 63.98 Canceled 0.1 62.16 Nonvested performance share awards as of December 31, 2021 0.7 $ 54.37 The total intrinsic value of performance share awards vested was $4.7 million, $8.7 million and $17.6 million during 2021, 2020 and 2019, respectively. Performance share awards above represent initial target awards and do not reflect potential increases or decreases resulting from the final performance results to be determined at the end of the respective performance period. The actual number of common shares to be awarded at the end of each performance period will range between 0% and 150% of the initial target awards. The fair value of performance share awards is determined based on the closing stock price of our common shares on the grant date. The weighted-average grant-date fair value of performance share awards granted during 2021, 2020 and 2019 was $58.68, $51.73 and $53.09, respectively. As of December 31, 2021, we had $5.9 million of total unrecognized compensation cost related to nonvested performance share awards granted. The cost is expected to be recognized over a weighted-average service period of approximately 1.7 years. Actual tax benefits realized for the tax deductions for performance share awards paid out under these share-based payment arrangements for 2021, 2020 and 2019 was $1.8 million, $3.0 million and $3.3 million, respectively. Restricted Stock Units We issue restricted stock units under the 2021 Stock Incentive Plan, 2020 Directors Stock Plan, 2014 Stock Incentive Plan, the 2014 Directors Stock Plan, the Amended and Restated 2010 Stock Incentive Plan, the 2005 Directors Stock Plan, the Stock Incentive Plan, and the Directors Stock Plan. Restricted stock units are treated as an equity award and are paid in shares. These awards have no maximum contractual term. Dividend equivalents are credited on restricted stock units outstanding as of the record date. These dividend equivalents are only paid on the shares released. Restricted stock units granted were 1.1 million, 1.1 million and 1.1 million in 2021, 2020 and 2019, respectively. Restricted stock units were issued to certain employees and agents pursuant to the 2021 Stock Incentive Plan, 2014 Stock Incentive Plan, the Amended and Restated 2010 Stock Incentive Plan and Stock Incentive Plan. Under these plans, awards have graded or cliff vesting over a three-year service period. When service for PFG ceases (except in the case of specific types of terminations), all vesting stops and unvested units are forfeited. Pursuant to the 2021 Stock Incentive Plan, 2020 Directors Stock Plan, 2014 Directors Stock Plan and the 2005 Directors Stock Plan, restricted stock units are granted to each non-employee director in office immediately following each annual meeting of stockholders and, at the discretion of the Nominating and Governance Committee, to each person who becomes a member of the Board other than on the date of the annual meeting of stockholders. Under these plans, awards are granted on an annual basis and cliff vest after a one-year service period. When service to PFG ceases, all vesting stops and unvested units are forfeited. The following is a summary of activity for the nonvested restricted stock units: Number of Weighted- restricted average grant-date stock units fair value (in millions) Nonvested restricted stock units as of January 1, 2021 2.8 $ 54.86 Granted 1.1 59.17 Vested 0.8 62.01 Canceled 0.1 55.50 Nonvested restricted stock units as of December 31, 2021 3.0 $ 54.50 The total intrinsic value of restricted stock units vested was $51.7 million, $41.2 million and $64.0 during 2021, 2020 and 2019, respectively. The fair value of restricted stock units is determined based on the closing stock price of our common shares on the grant date. The weighted-average grant-date fair value of restricted stock units granted during 2021, 2020 and 2019 was $59.17, $50.49 and $53.17, respectively. As of December 31, 2021, we had $52.0 million of total unrecognized compensation cost related to nonvested restricted stock unit awards granted under these plans. The cost is expected to be recognized over a weighted-average period of approximately 1.7 years. The actual tax benefits realized for the tax deductions for restricted stock unit payouts under these share-based payment arrangements for 2021, 2020 and 2019 was $17.8 million, $14.6 million and $13.2 million, respectively. Employee Stock Purchase Plan Under our Employee Stock Purchase Plan, participating employees have the opportunity to purchase shares of our common stock on a quarterly basis. Employees may purchase up to $25,000 in stock value annually. Employees were able to purchase shares of our common stock at a price equal to 85% of the shares’ fair market value as of the beginning or end of the purchase period, whichever was lower, through 2021. Beginning January 2022, employees may purchase shares of our common stock at a price equal to 90% of the shares’ fair market value as of the end of the purchase period. Under the Employee Stock Purchase Plan, employees purchased 1.0 million, 1.4 million and 0.9 million shares during 2021, 2020 and 2019, respectively. We recognize compensation expense for the fair value of the discount granted to employees participating in the employee stock purchase plan in the period of grant. Shares of the Employee Stock Purchase Plan are treated as an equity award. The weighted-average fair value of the discount on the stock purchased was $15.64, $11.33 and $11.37 during 2021, 2020 and 2019, respectively. The total intrinsic value of the Employee Stock Purchase Plan shares settled was $15.3 million, $15.5 million and $9.7 million during 2021, 2020 and 2019, respectively. Cash received from shares issued under these share-based payment arrangements for 2021, 2020 and 2019 was $46.5 million, $37.8 million and $36.2 million, respectively. The actual tax benefit realized for the tax deductions for the settlement of the share-based payment arrangements for 2021, 2020 and 2019 was $1.3 million, $0.9 million and $0.9 million, respectively. As of December 31, 2021, a total of 4.0 million of new shares were available to be made issuable by us for this plan. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Common Share | |
Earnings Per Common Share | 19. Earnings Per Common Share The computations of the basic and diluted per share amounts were as follows: For the year ended December 31, 2021 2020 2019 (in millions, except per share data) Net income $ 1,757.4 $ 1,428.5 $ 1,444.1 Subtract: Net income attributable to noncontrolling interest 46.8 32.7 49.9 Total $ 1,710.6 $ 1,395.8 $ 1,394.2 Weighted-average shares outstanding: Basic 269.0 274.7 278.6 Dilutive effects: Stock options 1.3 0.3 0.9 Restricted stock units 2.1 1.5 1.4 Performance share awards 0.5 0.1 0.1 Diluted 272.9 276.6 281.0 Net income per common share: Basic $ 6.36 $ 5.08 $ 5.00 Diluted $ 6.27 $ 5.05 $ 4.96 The calculation of diluted earnings per share for the years ended December 31, 2021, 2020 and 2019, excludes the incremental effect related to certain outstanding stock-based compensation grants due to their anti-dilutive effect. |
Subsequent Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2021 | |
Subsequent Event | |
Subsequent Event | 20. Subsequent Event On January 31, 2022, we entered into a Master Transaction Agreement with Sutton Cayman, Ltd., a limited company organized under the laws of the Cayman Islands and an affiliate of Talcott Resolution Life, Inc., a subsidiary of Sixth Street, pursuant to which we will cede 100% of our in-force U.S. retail fixed annuity and universal life insurance with secondary guarantee blocks of business (the “Reinsurance Transaction”). The Reinsurance Transaction will be structured through 100% coinsurance with funds withheld. We will retain administration of the ceded business. Additionally, Principal Global Investors, LLC will be appointed as investment adviser with respect to the management of all transferred commercial mortgage loans and private credit assets. The Reinsurance Transaction is expected to close during the second quarter of 2022 with economics effective as of January 1, 2022, subject to regulatory approval. The deployable proceeds from the Reinsurance Transaction and additional transactions designed to improve the capital efficiency of the in-force U.S. individual life insurance business will be returned to shareholders through share repurchases. Our Board of Directors approved a $1.6 billion increase to the $1.1 billion that remained available under our existing share repurchase authorization as of December 31, 2021. |
Schedule I - Summary of Investm
Schedule I - Summary of Investments - Other Than Investments in Related Parties | 12 Months Ended |
Dec. 31, 2021 | |
Schedule I - Summary of Investments - Other Than Investments in Related Parties | |
Schedule I - Summary of Investments - Other Than Investments in Related Parties | Schedule I - Summary of Investments - Other Than Investments in Related Parties December 31, 2021 Amount as shown in the consolidated statement of Fair financial Type of Investment Cost value position (in millions) Fixed maturities, available-for-sale: U.S. Treasury securities and obligations of U.S. government corporations and agencies $ 1,978.0 $ 2,088.6 $ 2,088.6 States, municipalities and political subdivisions 8,290.7 9,304.4 9,304.4 Foreign governments 851.0 982.0 982.0 Public utilities 5,226.7 5,695.8 5,695.8 Redeemable preferred stock 99.1 101.0 101.0 All other corporate bonds 36,813.4 40,147.6 40,147.6 Residential mortgage-backed pass-through securities 3,122.3 3,152.9 3,152.9 Commercial mortgage-backed securities 5,436.2 5,562.2 5,562.2 Collateralized debt obligations 3,564.7 3,559.6 3,559.6 Other debt obligations 7,487.8 7,560.4 7,560.4 Total fixed maturities, available-for-sale 72,869.9 78,154.5 78,154.5 Fixed maturities, trading 422.2 422.2 422.2 Equity securities: Banks, trust and insurance companies 886.9 886.9 886.9 Public utilities 7.5 7.5 7.5 Industrial, miscellaneous and all other 854.7 854.7 854.7 Other corporate 465.2 465.2 465.2 Non-redeemable preferred stock 132.9 132.9 132.9 Total equity securities 2,347.2 2,347.2 2,347.2 Mortgage loans 19,668.7 XXXX 19,668.7 Real estate, net: Real estate acquired in satisfaction of debt 14.8 XXXX 14.8 Other real estate 2,060.6 XXXX 2,060.6 Policy loans 759.6 XXXX 759.6 Other investments 5,478.3 XXXX 5,478.3 Total investments $ 103,621.3 XXXX $ 108,905.9 |
Schedule II - Condensed Financi
Schedule II - Condensed Financial Information of Registrant (Parent Only) | 12 Months Ended |
Dec. 31, 2021 | |
Schedule II - Condensed Financial Information of Registrant (Parent Only) | |
Schedule II - Condensed Financial Information of Registrant (Parent Only) | Schedule II - Condensed Financial Information of Registrant (Parent Only) Statements of Financial Position December 31, 2021 2020 (in millions) Assets Fixed maturities, available-for-sale $ 1,051.9 $ 813.2 Fixed maturities, trading 109.0 178.8 Other investments 10.4 63.7 Cash and cash equivalents 320.3 302.4 Income taxes receivable 20.4 7.4 Deferred income taxes 320.9 371.2 Amounts receivable from subsidiaries 5.5 4.7 Other assets 27.1 27.1 Investment in unconsolidated entities 18,932.4 19,714.3 Total assets $ 20,797.9 $ 21,482.8 Liabilities Long-term debt $ 4,226.2 $ 4,223.3 Accrued investment payable 25.3 25.3 Pension liability 473.2 668.9 Other liabilities 3.8 6.4 Total liabilities 4,728.5 4,923.9 Stockholders’ equity Common stock, par value $0.01 per share; 2,500 million shares authorized; 484.9 million and 481.9 million shares issued as of 2021 and 2020; 261.7 million and 273.3 million shares outstanding as of 2021 and 2020 4.8 4.8 Additional paid-in capital 10,495.0 10,321.6 Retained earnings 12,884.5 11,838.0 Accumulated other comprehensive income 1,610.9 2,383.1 Treasury stock, at cost (223.2 million and 208.6 million shares as of 2021 and 2020) (8,925.8) (7,988.6) Total stockholders’ equity attributable to Principal Financial Group, Inc. 16,069.4 16,558.9 Total liabilities and stockholders’ equity $ 20,797.9 $ 21,482.8 See accompanying notes. Statements of Operations For the year ended December 31, 2021 2020 2019 (in millions) Revenues Net investment income $ 18.6 $ 13.3 $ 19.4 Net realized capital gains (losses) (14.9) 7.0 12.3 Total revenues 3.7 20.3 31.7 Expenses Other operating costs and expenses 160.9 200.0 210.9 Total expenses 160.9 200.0 210.9 Loss before income taxes (157.2) (179.7) (179.2) Income tax benefits (35.6) (46.1) (44.2) Equity in the net income of subsidiaries 1,832.2 1,529.4 1,529.2 Net income attributable to Principal Financial Group, Inc. $ 1,710.6 $ 1,395.8 $ 1,394.2 See accompanying notes. Statements of Cash Flows For the year ended December 31, 2021 2020 2019 (in millions) Operating activities Net income $ 1,710.6 $ 1,395.8 $ 1,394.2 Adjustments to reconcile net income to net cash provided by (used in) operating activities: Net realized capital (gains) losses 14.9 (7.0) (12.3) Stock-based compensation 1.6 1.4 1.3 Equity in the net income of subsidiaries (1,832.2) (1,529.4) (1,529.2) Changes in: Net cash flows for trading securities and equity securities with operating intent 66.1 88.4 48.7 Current and deferred income tax benefits (4.8) (13.5) (31.0) Other (34.5) 49.1 135.4 Net cash provided by (used in) operating activities (78.3) (15.2) 7.1 Investing activities Fixed maturities available-for-sale and equity securities with intent to hold: Purchases (462.3) (736.5) (251.5) Maturities 190.2 193.7 200.0 Net purchases of property and equipment (0.1) (0.1) (0.1) Net change in other investments 46.7 (50.0) (34.0) Dividends and returns of capital received from unconsolidated entities 1,826.3 799.1 494.2 Net cash provided by investing activities 1,600.8 206.2 408.6 Financing activities Issuance of common stock 86.7 42.8 37.7 Acquisition of treasury stock (937.2) (307.0) (281.0) Dividends to common stockholders (654.1) (614.5) (606.0) Issuance of long-term debt — 595.2 493.6 Net cash used in financing activities (1,504.6) (283.5) (355.7) Net increase (decrease) in cash and cash equivalents 17.9 (92.5) 60.0 Cash and cash equivalents at beginning of year 302.4 394.9 334.9 Cash and cash equivalents at end of year $ 320.3 $ 302.4 $ 394.9 See accompanying notes. (1) Basis of Presentation The accompanying condensed financial information should be read in conjunction with the consolidated financial statements and notes thereto of Principal Financial Group, Inc. In the parent company only financial statements, our investment in unconsolidated entities is stated at cost plus equity in undistributed earnings of subsidiaries. Principal Financial Group, Inc. sponsors nonqualified benefit plans for select employees and agents and is responsible for the obligations of these plans. Nonqualified plan assets are held in Rabbi trusts for the benefit of all nonqualified plan participants. The invested assets and benefit plan liabilities reported in the statements of financial position exclude amounts held in these trusts. The Rabbi trusts had $889.0 million and $801.7 million of plan assets and $732.9 million and $653.3 million of benefit plan liabilities as of December 31, 2021 and 2020, respectively. (2) Dividends and Returns of Capital Received from Unconsolidated Entities The parent company received cash dividends and returns of capital totaling $1,826.3 million, $799.1 million and $494.2 million from subsidiaries in 2021, 2020 and 2019, respectively. |
Schedule III - Supplementary In
Schedule III - Supplementary Insurance Information | 12 Months Ended |
Dec. 31, 2021 | |
Schedule III - Supplementary Insurance Information | |
Schedule III - Supplementary Insurance Information | Schedule III - Supplementary Insurance Information As of December 31, 2021 and 2020 and for each of the years ended December 31, 2021, 2020 and 2019 Contractholder Deferred Future policy and other acquisition benefits and policyholder Segment costs claims funds (in millions) 2021: Retirement and Income Solutions $ 819.4 $ 27,716.5 $ 35,941.4 Principal Global Investors — — — Principal International 8.4 3,813.5 1,047.2 U.S. Insurance Solutions 2,929.7 12,262.1 8,039.6 Corporate — 156.0 (359.2) Total $ 3,757.5 $ 43,948.1 $ 44,669.0 2020: Retirement and Income Solutions $ 730.4 $ 28,134.1 $ 35,576.0 Principal Global Investors — — — Principal International 11.2 5,109.5 1,167.3 U.S. Insurance Solutions 2,668.1 11,800.3 7,909.5 Corporate — 163.3 (355.7) Total $ 3,409.7 $ 45,207.2 $ 44,297.1 Schedule III - Supplementary Insurance Information - (continued) As of December 31, 2021 and 2020 and for each of the years ended December 31, 2021, 2020 and 2019 Amortization of Premiums and Net Benefits, claims deferred Other other investment and settlement acquisition operating Segment considerations income (1) expenses costs expenses (1) (in millions) 2021: Retirement and Income Solutions $ 1,883.6 $ 2,674.4 $ 3,450.1 $ 116.7 $ 1,715.2 Principal Global Investors — 3.9 — — 1,128.6 Principal International 127.5 631.1 610.0 1.2 469.1 U.S. Insurance Solutions 2,830.4 917.1 3,031.7 167.5 998.2 Corporate — 179.6 5.2 — 390.8 Total $ 4,841.5 $ 4,406.1 $ 7,097.0 $ 285.4 $ 4,701.9 2020: Retirement and Income Solutions $ 3,221.0 $ 2,457.9 $ 4,899.4 $ 82.2 $ 1,578.2 Principal Global Investors — 5.6 — — 1,029.6 Principal International 156.6 446.8 440.7 1.2 416.8 U.S. Insurance Solutions 2,659.8 850.6 2,937.2 304.7 936.9 Corporate — 129.7 4.2 — 296.9 Total $ 6,037.4 $ 3,890.6 $ 8,281.5 $ 388.1 $ 4,258.4 2019: Retirement and Income Solutions $ 4,862.7 $ 2,420.4 $ 6,527.8 $ 87.8 $ 1,403.5 Principal Global Investors — 10.1 — — 1,028.5 Principal International 393.3 575.9 728.3 1.3 436.0 U.S. Insurance Solutions 2,610.6 854.5 2,639.2 257.9 946.5 Corporate — 137.5 10.5 — 342.4 Total $ 7,866.6 $ 3,998.4 $ 9,905.8 $ 347.0 $ 4,156.9 (1) Allocations of net investment income and certain operating expenses are based on a number of assumptions and estimates. Reported operating results would change by segment if different methods were applied. |
Schedule IV - Reinsurance
Schedule IV - Reinsurance | 12 Months Ended |
Dec. 31, 2021 | |
Schedule IV - Reinsurance | |
Schedule IV - Reinsurance | Schedule IV - Reinsurance As of December 31, 2021, 2020 and 2019 and for each of the years then ended Percentage Ceded to Assumed of amount Gross other from other assumed amount companies companies Net amount to net ($ in millions) 2021: Life insurance in force $ 667,509.8 $ 383,937.7 $ 787.8 $ 284,359.9 0.3 % Premiums: Life insurance and annuities $ 3,323.3 $ 494.9 $ 1.5 $ 2,829.9 0.1 % Accident and health insurance 2,167.3 155.7 — 2,011.6 — % Total $ 5,490.6 $ 650.6 $ 1.5 $ 4,841.5 — % 2020: Life insurance in force $ 626,155.6 $ 377,308.2 $ 904.1 $ 249,751.5 0.4 % Premiums: Life insurance and annuities $ 4,608.7 $ 453.1 $ 1.7 $ 4,157.3 — % Accident and health insurance 2,036.7 156.6 — 1,880.1 — % Total $ 6,645.4 $ 609.7 $ 1.7 $ 6,037.4 — % 2019: Life insurance in force $ 577,735.3 $ 368,583.0 $ 999.5 $ 210,151.8 0.5 % Premiums: Life insurance and annuities $ 6,424.8 $ 407.5 $ 1.6 $ 6,018.9 — % Accident and health insurance 2,003.3 155.6 — 1,847.7 — % Total $ 8,428.1 $ 563.1 $ 1.6 $ 7,866.6 — % |
Nature of Operations and Sign_2
Nature of Operations and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations and Significant Accounting Policies | |
Basis of Presentation - Policy | Basis of Presentation The accompanying consolidated financial statements include the accounts of PFG and all other entities in which we directly or indirectly have a controlling financial interest as well as those variable interest entities (“VIEs”) in which we are the primary beneficiary. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”). All significant intercompany accounts and transactions have been eliminated. Uncertainties, including those associated with the novel coronavirus (“COVID-19”), may impact our business, results of operations, financial condition and liquidity. Our use of estimates and assumptions affect amounts reported and disclosed and includes, but is not limited to, the fair value of investments in the absence of quoted market values, investment impairments and valuation allowances, the fair value of derivatives, deferred acquisition costs (“DAC”) and other actuarial balances, measurement of goodwill and intangible assets, the liability for future policy benefits and claims, the value of pension and other postretirement benefits and accounting for income taxes and the valuation of deferred tax assets. Our estimates and assumptions could change in the future as more information becomes known about the impact of COVID-19. Our results of operations and financial condition may also be impacted by other uncertainties including evolving regulatory, legislative and standard-setter accounting interpretations and guidance. Certain reclassifications have been made to prior periods relating to the significant components of net deferred income taxes to conform to the current presentation. See Note 10, Income Taxes, under the caption “Net Deferred Income Taxes.” |
Consolidation - Policy | Consolidation We have relationships with various special purpose entities and other legal entities that must be evaluated to determine if the entities meet the criteria of a VIE or a voting interest entity (“VOE”). This assessment is performed by reviewing contractual, ownership and other rights, including involvement of related parties, and requires use of judgment. First, we determine if we hold a variable interest in an entity by assessing if we have the right to receive expected losses and expected residual returns of the entity. If we hold a variable interest, then the entity is assessed to determine if it is a VIE. An entity is a VIE if the equity at risk is not sufficient to support its activities, if the equity holders lack a controlling financial interest or if the entity is structured with non-substantive voting rights. In addition to the previous criteria, if the entity is a limited partnership or similar entity, it is a VIE if the limited partners do not have the power to direct the entity’s most significant activities through substantive kick-out rights or participating rights. A VIE is evaluated to determine the primary beneficiary. The primary beneficiary of a VIE is the enterprise with (1) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (2) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. When we are the primary beneficiary, we are required to consolidate the entity in our financial statements. We reassess our involvement with VIEs on a quarterly basis. For further information about VIEs, refer to Note 3, Variable Interest Entities. If an entity is not a VIE, it is considered a VOE. VOEs are generally consolidated if we own a greater than 50% voting interest. If we determine our involvement in an entity no longer meets the requirements for consolidation under either the VIE or VOE models, the entity is deconsolidated. Entities in which we have management influence over the operating and financing decisions but are not required to consolidate, other than investments accounted for at fair value under the fair value option, are reported using the equity method. |
Recent Accounting Pronouncements - Policy | Recent Accounting Pronouncements Description Date of adoption Effect on our consolidated financial statements or other significant matters Standards not yet adopted: Targeted improvements to the accounting for long-duration insurance contracts This authoritative guidance updates certain requirements in the accounting for long-duration insurance and annuity contracts. 1. The assumptions used to calculate the liability for future policy benefits on traditional and limited-payment contracts will be reviewed and updated periodically. Cash flow assumptions will be reviewed at least annually and updated when necessary with the impact recognized in net income. Discount rate assumptions are prescribed as the current upper-medium grade (low credit risk) fixed income instrument yield and will be updated quarterly with the impact recognized in other comprehensive income (“OCI”). 2. Market risk benefits, which are contracts or contract features that provide protection to the policyholder from capital market risk and expose us to other-than-nominal capital market risk, are measured at fair value. The periodic change in fair value is recognized in net income with the exception of the periodic change in fair value related to our own nonperformance risk, which is recognized in OCI. 3. DAC and other actuarial balances for all insurance and annuity contracts will be amortized on a constant basis over the expected term of the related contracts. 4. Additional disclosures are required, including disaggregated rollforwards of significant insurance liabilities and other account balances as well as disclosures about significant inputs, judgments, assumptions and methods used in measurement. The guidance for the liability for future policy benefits for traditional and limited-payment contracts and DAC will be applied on a modified retrospective basis; that is, to contracts in force as of the beginning of the earliest period presented based on their existing carrying amounts. An entity may elect to apply the changes retrospectively. The guidance for market risk benefits will be applied retrospectively. Early adoption is permitted. January 1, 2023 Our implementation and evaluation process to date includes, but is not limited to the following: ● ● ● ● ● ● ● ● ● ● This guidance will significantly change how we account for many of our insurance and annuity products. As we progress through our implementation, we will be able to better assess the impact to our consolidated financial statements. Description Date of adoption Effect on our consolidated financial statements or other significant matters Standards adopted: Simplifying the accounting for income taxes This authoritative guidance simplifies the accounting for income taxes by removing certain exceptions, including exceptions related to the incremental approach for intraperiod tax allocation, calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. Also, the guidance clarifies the accounting for franchise taxes, transactions that result in a step-up in the tax basis of goodwill and enacted changes in tax laws or rates. It specifies that an entity is not required to allocate the consolidated amount of current and deferred tax expense to a legal entity that is not subject to tax in its separate financial statements, although an entity may elect to do so. The guidance will be applied based on varying transition methods defined by amendment. Early adoption is permitted. January 1, 2021 This guidance did not have a material impact on our consolidated financial statements. Facilitation of the effects of reference rate reform on financial reporting This authoritative guidance provides optional expedients and exceptions for contracts and hedging relationships affected by reference rate reform. An entity may elect not to apply certain modification accounting requirements to contracts affected by reference rate reform and instead account for the modified contract as a continuation of the existing contract. Also, an entity may apply optional expedients to continue hedge accounting for hedging relationships in which the critical terms change due to reference rate reform. This guidance eases the financial reporting impacts of reference rate reform on contracts and hedging relationships and is effective until December 31, 2022. March 12, 2020 We adopted the guidance upon issuance prospectively and elected the applicable optional expedients and exceptions for contracts and hedging relationships impacted by reference rate reform through December 31, 2022. The guidance did not have an impact on our consolidated financial statements upon adoption. Goodwill impairment testing This authoritative guidance simplifies how an entity is required to test goodwill for impairment by eliminating Step 2 (which measures a goodwill impairment loss by comparing the implied fair value of a reporting unit’s goodwill to the carrying amount of that goodwill) from the goodwill impairment test. A goodwill impairment loss will be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. Entities will continue to have the option to perform a qualitative assessment to determine if a quantitative impairment test is necessary. January 1, 2020 This guidance reduces complexity and costs associated with performing a Step 2 test, should one be needed in the future. This guidance did not have a material impact on our consolidated financial statements at adoption. Credit losses This authoritative guidance requires entities to use a current expected credit loss (“CECL”) model to measure impairment for most financial assets that are not recorded at fair value through net income. Under the CECL model, an entity will estimate lifetime expected credit losses considering available relevant information about historical events, current conditions and reasonable and supportable forecasts. The CECL model does not apply to available-for-sale debt securities; however, the credit loss calculation and subsequent recoveries for available-for-sale securities are required to be recorded through an allowance. This guidance also expands the required credit loss disclosures. January 1, 2020 We adopted the guidance using the modified retrospective approach. A cumulative effect adjustment of $8.4 million was recorded as a decrease to retained earnings. We recorded an offsetting increase in the allowance for credit loss for mortgage loans, reinsurance recoverables and commitments and a decrease for deferred tax impacts. See Note 4, Investments, for further details. Description Date of adoption Effect on our consolidated financial statements or other significant matters Implementation costs in a cloud computing arrangement that is a service contract This authoritative guidance aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. This guidance can be applied either retrospectively or prospectively. January 1, 2019 The effective date of the guidance was January 1, 2020; however, we elected to early-adopt this guidance on a prospective basis, effective January 1, 2019. This guidance did not have a material impact on our consolidated financial statements. Nonemployee share-based payment accounting This authoritative guidance simplifies the accounting for share-based payments to nonemployees by generally aligning it with the accounting for share-based payments to employees. Under the guidance, the measurement of equity-classified nonemployee awards will be fixed at the grant date, where previously the measurement was fixed at performance completion date. The guidance will be applied to equity-classified nonemployee awards for which a measurement date has not been established as of the date of adoption. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. Leases This authoritative guidance requires lessee recognition of lease assets and lease liabilities on the consolidated statements of financial position. The concept of an operating lease, where the lease assets and liabilities are not reported on the consolidated statements of financial position, is eliminated under the new guidance. For lessors, the guidance modifies lease classification criteria and accounting for certain types of leases. Other key aspects of the guidance relate to the removal of the current real estate-specific guidance and new presentation and disclosure requirements. Lessees and lessors are required to recognize and measure leases using a modified retrospective approach, which includes certain optional practical expedients that may be elected. We elected the alternative transition method, which allows entities to initially apply the new standard at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings in the period of adoption. January 1, 2019 We adopted the guidance using the modified retrospective approach. A cumulative effect adjustment of $4.0 million was recorded as an increase to retained earnings. See Note 12, Contingencies, Guarantees, Indemnifications and Leases, for further details. Targeted improvements to accounting for hedging activities This authoritative guidance updated certain recognition and measurement requirements for hedge accounting. The objective of the guidance is to more closely align the economics of a company’s risk management activities in its financial results and reduce the complexity of applying hedge accounting. The updates included the expansion of hedging strategies that are eligible for hedge accounting, elimination of the separate measurement and reporting of hedge ineffectiveness, presentation of the changes in the fair value of the hedging instrument in the same consolidated statement of operations line as the earnings effect of the hedged item and simplification of hedge effectiveness assessments. This guidance also included new disclosures. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. See Note 5, Derivative Financial Instruments, for further details. Description Date of adoption Effect on our consolidated financial statements or other significant matters Premium amortization on purchased callable debt securities This authoritative guidance applies to entities that hold certain non-contingently callable debt securities, where the amortized cost basis is at a premium to the price repayable by the issuer at the earliest call date. Under the guidance the premium will be amortized to the first call date. January 1, 2019 This guidance did not have a material impact on our consolidated financial statements. When we adopt new accounting standards, we have a process in place to perform a thorough review of the pronouncement, identify the financial statement and system impacts and create an implementation plan among our impacted business units to ensure we are compliant with the pronouncement on the date of adoption. This includes having effective processes and controls in place to support the reported amounts. Each of the standards listed above is in varying stages in our implementation process based on its issuance and adoption dates. We are on track to implement guidance by the respective effective dates. |
Use of Estimates in the Preparation of Financial Statements - Policy | Use of Estimates in the Preparation of Financial Statements The preparation of our consolidated financial statements and accompanying notes requires management to make estimates and assumptions that affect the amounts reported and disclosed. These estimates and assumptions could change in the future as more information becomes known, which could impact the amounts reported and disclosed in the consolidated financial statements and accompanying notes. The most critical estimates include those used in determining: ● the fair value of investments in the absence of quoted market values; ● investment impairments and valuation allowances; ● the fair value of and accounting for derivatives; ● the DAC and other actuarial balances where the amortization is based on estimated gross profits (“EGPs”); ● the measurement of goodwill, indefinite lived intangible assets, finite lived intangible assets and related impairments or amortization, if any; ● the liability for future policy benefits and claims; ● the value of our pension and other postretirement benefit obligations and ● accounting for income taxes and the valuation of deferred tax assets. A description of such critical estimates is incorporated within the discussion of the related accounting policies that follow. In applying these policies, management makes subjective and complex judgments that frequently require estimates about matters that are inherently uncertain. Actual results could differ from these estimates. |
Closed Block - Policy | Closed Block Principal Life Insurance Company (“Principal Life”) operates a closed block (“Closed Block”) for the benefit of individual participating dividend-paying policies in force at the time of the 1998 mutual insurance holding company (“MIHC”) formation. See Note 6, Closed Block, for further details. |
Cash and Cash Equivalents - Policy | Cash and Cash Equivalents Cash and cash equivalents include cash on hand, money market instruments and other debt issues with a maturity date of three months or less when purchased. |
Investments - Policy | Investments Fixed maturities include bonds, asset-backed securities (“ABS”), redeemable preferred stock and certain non-redeemable preferred securities. Equity securities include mutual funds, common stock, non-redeemable preferred stock and required regulatory investments. We classify fixed maturities as either available-for-sale or trading at the time of the purchase and, accordingly, carry them at fair value. Equity securities are also carried at fair value. See Note 14, Fair Value Measurements, for methodologies related to the determination of fair value. Unrealized gains and losses related to fixed maturities, available-for-sale, excluding those in fair value hedging relationships, are reflected in stockholders’ equity, net of adjustments associated with DAC and related actuarial balances, derivatives in cash flow hedge relationships and applicable income taxes. Mark-to-market adjustments on certain equity securities and mark-to-market adjustments on certain fixed maturities, trading are reflected in net realized capital gains (losses). Unrealized gains and losses related to hedged portions of fixed maturities, available-for-sale in fair value hedging relationships are reflected in net investment income. Mark-to-market adjustments related to certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reflected in net investment income. The amortized cost of fixed maturities includes cost adjusted for amortization of premiums and discounts, computed using the interest method. The amortized cost of fixed maturities, available-for-sale is adjusted for changes in fair value of the hedged portions of securities in fair value hedging relationships and excludes accrued interest receivable. Accrued interest receivable is reported in accrued investment income on the consolidated statements of financial position. Beginning in 2020, fixed maturities, available-for-sale are subject to an allowance for credit loss and changes in the allowance are reported in net income as a component of net realized capital gains (losses). Prior to 2020, the amortized cost of fixed maturities classified as available-for-sale was adjusted for declines in value that were other than temporary. Prior to 2020, impairments in value deemed to be other than temporary were primarily reported in net income as a component of net realized capital gains (losses), with noncredit impairment losses for certain fixed maturities, available-for-sale reported in OCI. Interest income, as well as prepayment fees and the amortization of the related premium or discount, is reported in net investment income. For loan-backed and structured securities, we recognize income using a constant effective yield based on currently anticipated cash flows. Commercial and residential mortgage loans are generally reported at cost adjusted for amortization of premiums and accrual of discounts, computed using the interest method and net of valuation allowances. Amortized cost excludes accrued interest receivable. Interest income is accrued on the principal amount of the loan based on the loan’s contractual interest rate. Interest income, as well as prepayment of fees and the amortization of the related premium or discount, is reported in net investment income on the consolidated statements of operations. Accrued interest receivable is reported in accrued investment income on the consolidated statements of financial position. Any changes in the loan valuation allowances are reported in net realized capital gains (losses) on the consolidated statements of operations. See Note 4, Investments, for further details of our valuation allowance. Our commercial and residential mortgage loan portfolios can include loans that have been modified. We assess loan modifications on a case-by-case basis to evaluate whether a troubled debt restructuring (“TDR”) has occurred. In response to COVID-19, the Coronavirus Aid, Relief and Economic Security Act, which was subsequently amended by the Consolidated Appropriations Act, 2021, (collectively the “CARES Act”) provides a temporary suspension of TDR accounting for certain COVID-19 related loan modifications where the loan was not more than 30 days past due as of December 31, 2019. We elected the TDR relief in the CARES Act beginning in the second quarter of 2020. The CARES Act TDR relief does not apply to modifications completed subsequent to the earlier of 60 days after the national emergency related to COVID-19 ends, or January 1, 2022. In addition, the Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus (As Revised on April 7, 2020) (“Interagency Statement”) provides additional guidance to determine if a short-term COVID-19 related loan modification is a TDR. We consider the CARES Act and the Interagency Statement when assessing loan modifications to determine whether a TDR has occurred. See Note 4, Investments, under the caption “Mortgage Loan Modifications” for further details. Real estate investments are reported at cost less accumulated depreciation. The initial cost bases of properties acquired through loan foreclosures are the lower of the fair market values of the properties at the time of foreclosure or the outstanding loan balance. Buildings and land improvements are generally depreciated on the straight-line method over the estimated useful life of improvements and tenant improvement costs are depreciated on the straight-line method over the term of the related lease. We recognize impairment losses for properties when indicators of impairment are present and a property’s expected undiscounted cash flows are not sufficient to recover the property’s carrying value. In such cases, the cost basis of the property is reduced to fair value. Real estate expected to be disposed is carried at the lower of cost or fair value, less cost to sell, with valuation allowances established accordingly and depreciation no longer recognized. The carrying amount of real estate held for sale was $88.7 million and $2.0 million as of December 31, 2021 and 2020, respectively. Any impairment losses and any changes in valuation allowances are reported in net income. Net realized capital gains and losses on sales of investments are determined on the basis of specific identification. In general, in addition to realized capital gains and losses on investment sales and periodic settlements on derivatives not designated as hedges, we report gains and losses related to the following in net realized capital gains (losses) on the consolidated statements of operations: mark-to-market adjustments on certain equity securities, mark-to-market adjustments on certain fixed maturities, trading, mark-to-market adjustments on sponsored investment funds, mark-to-market adjustments on derivatives not designated as hedges, cash flow hedge gains (losses) when the hedged item impacts realized capital gains (losses), changes in the valuation allowance for fixed maturities, available-for-sale and certain financing receivables, impairments of real estate held for investment, impairments of equity method investments and, prior to 2020, other-than-temporary impairments of securities and subsequent realized recoveries. Investment gains and losses on sales of certain real estate held for sale due to investment strategy and mark-to-market adjustments on certain securities carried at fair value with an investment objective to realize economic value through mark-to-market changes are reported as net investment income and are excluded from net realized capital gains (losses). Policy loans and certain other investments are reported at cost. Interests in unconsolidated entities, joint ventures and partnerships are generally accounted for using the equity method. We have other investments reported at fair value or for which the fair value option has been elected in prior periods. See Note 14, Fair Value Measurements, for detail on these investments. |
Derivatives - Policy | Derivatives Overview Derivatives are financial instruments whose values are derived from interest rates, foreign exchange rates, financial indices or the values of securities. Derivatives generally used by us include swaps, options, futures and forwards. Derivative positions are either assets or liabilities in the consolidated statements of financial position and are measured at fair value, generally by obtaining quoted market prices or through the use of pricing models. See Note 14, Fair Value Measurements, for policies related to the determination of fair value. Fair values can be affected by changes in interest rates, foreign exchange rates, financial indices, values of securities, credit spreads, and market volatility and liquidity. Accounting and Financial Statement Presentation We designate derivatives as either: (a) a hedge of the exposure to changes in the fair value of a recognized asset or liability or an unrecognized firm commitment, including those denominated in a foreign currency (“fair value hedge”); (b) a hedge of a forecasted transaction or the exposure to variability of cash flows to be received or paid related to a recognized asset or liability, including those denominated in a foreign currency (“cash flow hedge”); (c) a hedge of a net investment in a foreign operation or (d) a derivative not designated as a hedging instrument. Our accounting for the ongoing changes in fair value of a derivative depends on the intended use of the derivative and the designation, as described above, and is determined when the derivative contract is entered into or at the time of redesignation. Hedge accounting is used for derivatives that are specifically designated in advance as hedges and that reduce our exposure to an indicated risk by having a high correlation between changes in the value of the derivatives and the items being hedged at both the inception of the hedge and throughout the hedge period. Cash flows associated with derivatives are included within operating and financing activities in the consolidated statements of cash flows. Fair Value Hedges. Cash Flow Hedges. Net Investment in a Foreign Operation Hedge. Non-Hedge Derivatives. Hedge Documentation and Effectiveness Testing. hedge is determined to be highly effective, the hedge may still result in a mismatch between the change in the fair value of the hedging instrument and the change in the fair value of the hedged item attributable to the hedged risk. We use qualitative and quantitative methods to assess hedge effectiveness. Qualitative methods may include monitoring changes to terms and conditions and counterparty credit ratings. Quantitative methods may include statistical tests including regression analysis and minimum variance and dollar offset techniques. For last-of-layer method hedges, the assessment of hedge effectiveness includes confirming we expect the hedged last layer amount to be outstanding at the end of the hedging relationship. Termination of Hedge Accounting. If it is determined that a derivative no longer qualifies as an effective hedge, the derivative will continue to be carried on the consolidated statements of financial position at its fair value, with changes in fair value recognized prospectively in net realized capital gains (losses). The asset or liability under a fair value hedge will no longer be adjusted for changes in fair value pursuant to hedging rules and the existing basis adjustment is amortized to the consolidated statements of operations line associated with the asset or liability. If a last-of-layer method hedging relationship is discontinued, the outstanding basis adjustment is allocated to the individual assets in the closed portfolio and those amounts are amortized consistent with the amortization of other discounts or premiums associated with those assets. The component of AOCI related to discontinued cash flow hedges that are no longer highly effective is amortized to the consolidated statements of operations consistent with the net income impacts of the original hedged cash flows. If a cash flow hedge is discontinued because it is probable the hedged forecasted transaction will not occur, the deferred gain or loss is immediately reclassified from AOCI into net income. Embedded Derivatives. |
Contractholder and Policyholder Liabilities - Policy | Contractholder and Policyholder Liabilities Contractholder and policyholder liabilities (contractholder funds, future policy benefits and claims and other policyholder funds) include reserves for investment contracts, individual and group annuities that provide periodic income payments, universal life insurance, variable universal life insurance, indexed universal life insurance, term life insurance, participating traditional individual life insurance, group dental and vision insurance, group critical illness, group accident, group short-term and long-term disability insurance, group life insurance, individual disability insurance and long-term care insurance. It also includes a provision for dividends on participating policies. Investment contracts are contractholders’ funds on deposit with us and generally include reserves for pension and annuity contracts. Reserves on investment contracts are equal to the cumulative deposits less any applicable charges and withdrawals plus credited interest. Reserves for universal life, variable universal life and indexed universal life insurance contracts are equal to cumulative deposits less charges plus credited interest, which represents the account balances that accrue to the benefit of the policyholders. We hold additional reserves on certain long-duration contracts where benefit features result in gains in early years followed by losses in later years; universal life, variable universal life and indexed universal life insurance contracts that contain no lapse guarantee features; and annuities with guaranteed minimum death benefits. Reserves for individual and group annuities that provide periodic income payments, nonparticipating term life insurance and disability income contracts are computed on a basis of assumed investment yield, mortality, morbidity and expenses, including a provision for adverse deviation, which generally varies by plan, year of issue and policy duration. Investment yield is based on our experience. Mortality, morbidity and withdrawal rate assumptions are based on our experience and are periodically reviewed against both industry standards and experience. For long-duration insurance contracts, significant changes in experience or assumptions may require us to provide for expected future losses on a product by establishing premium deficiency reserves. Premium deficiency reserves may also be established for short-duration contracts to provide for expected future losses. Reserves for participating life insurance contracts are based on the net level premium reserve for death and endowment policy benefits. This net level premium reserve is calculated based on dividend fund interest rates and mortality rates guaranteed in calculating the cash surrender values described in the contract. Participating business represented approximately 4%, 5% and 6% of our life insurance in force and 18%, 20% and 23% of the number of life insurance policies in force as of December 31, 2021, 2020 and 2019, respectively. Participating business represented approximately 22%, 24% and 21% of life insurance premiums for the years ended December 31, 2021, 2020 and 2019, respectively. The amount of dividends to policyholders is declared annually by Principal Life’s Board of Directors. The amount of dividends to be paid to policyholders is determined after consideration of several factors including interest, mortality, morbidity and other expense experience for the year and judgment as to the appropriate level of statutory surplus to be retained by Principal Life. At the end of the reporting period, Principal Life establishes a dividend liability for the pro rata portion of the dividends expected to be paid on or before the next policy anniversary date. Some of our policies and contracts require payment of fees or other policyholder assessments in advance for services that will be rendered over the estimated lives of the policies and contracts. These payments are established as unearned revenue liabilities upon receipt and included in other policyholder funds in the consolidated statements of financial position. These unearned revenue reserves are amortized to net income over the estimated lives of these policies and contracts in relation to the emergence of EGPs. Short-Duration Contracts We include the following group products in our short-duration insurance contracts disclosures: long-term disability (“LTD”), group life waiver, dental, vision, short-term disability (“STD”), critical illness, accident and group life. Future policy benefits and claims include reserves for group life and disability insurance that provide periodic income payments. These reserves are computed using assumptions of mortality, morbidity and investment performance. These assumptions are based on our experience, industry results, emerging trends and future expectations. Future policy benefits and claims also include reserves for incurred but unreported group disability, dental, vision, critical illness, accident and life insurance claims. We recognize claims costs in the period the service was provided to our policyholders. However, claims costs incurred in a particular period are not known with certainty until after we receive, process and pay the claims. We determine the amount of this liability using actuarial methods based on historical claim payment patterns as well as emerging cost trends, where applicable, to determine our estimate of claim liabilities. We have defined claim frequency as follows for each short-duration product: ● LTD: Claim frequency is based on submitted reserve claim counts. ● Group Life Waiver: Claim frequency is based on submitted reserve claim counts, consistent with LTD. ● Dental and Vision: Claim frequency is based on the claim form, which may include one or more procedures. ● STD, Critical Illness and Accident: Claim frequency is based on submitted claims. ● Group Life: Claim frequency is based on submitted life claims (lives, not coverages). We did not make any significant changes to our methodologies or assumptions used to calculate the liability for unpaid claims for short-duration contracts during 2021. Liability for Unpaid Claims The liability for unpaid claims for both long-duration and short-duration contracts is an estimate of the ultimate net cost of reported and unreported losses not yet settled. This liability is estimated using actuarial analyses and case basis evaluations. Although considerable variability is inherent in such estimates, we believe the liability for unpaid claims is adequate. These estimates are continually reviewed and, as adjustments to this liability become necessary, such adjustments are reflected in net income. Our liability for unpaid claims does not include any allocated claim adjustment expenses. We incur claim adjustment expenses for both long-duration and short-duration contracts that cannot be allocated to a specific claim. Our claim adjustment expense liability is estimated using actuarial analyses based on historical trends of expenses and expected claim runout patterns. See Note 8, Insurance Liabilities, under the caption “Liability for Unpaid Claims” for further details. |
Recognition of Premiums and Other Considerations, Fees and Other Revenues and Benefits - Policy | Recognition of Premiums and Other Considerations, Fees and Other Revenues and Benefits Products with fixed and guaranteed premiums and benefits consist principally of whole life and term life insurance policies and individual disability income. Premiums from these products are recognized as premium revenue when due. Related policy benefits and expenses for individual life products are associated with earned premiums and result in the recognition of profits over the expected term of the policies and contracts. Immediate annuities with life contingencies include products with fixed and guaranteed annuity considerations and benefits and consist principally of group and individual single premium annuities with life contingencies. Annuity considerations from these products are recognized as premium revenue. However, the collection of these annuity considerations does not represent the completion of the earnings process, as we establish annuity reserves using estimates for mortality and investment assumptions, which include provision for adverse deviation as required by U.S. GAAP. We anticipate profits to emerge over the life of the annuity products as we earn investment income, pay benefits and release reserves. Group life, dental, vision, critical illness, accident and disability premiums are generally recorded as premium revenue over the term of the coverage. Certain group contracts contain experience premium refund provisions based on a pre-defined formula that reflects their claim experience. Experience premium refunds reduce revenue over the term of the coverage and are adjusted to reflect current experience. Related policy benefits and expenses are associated with earned premiums and result in the recognition of profits over the term of the policies and contracts. Fees for contracts providing claim processing or other administrative services are recorded as revenue over the period the service is provided. Universal life-type policies are insurance contracts with terms that are not fixed. Amounts received as payments for such contracts are not reported as premium revenues. Revenues for universal life-type insurance contracts consist of policy charges for the cost of insurance, policy initiation and administration, surrender charges and other fees that have been assessed against policy account values and investment income. Policy benefits and claims that are charged to expense include interest credited to contracts and benefit claims incurred in the period in excess of related policy account balances. Investment contracts do not subject us to significant risks arising from policyholder mortality or morbidity and consist primarily of guaranteed investment contracts (“GICs”), funding agreements and certain deferred annuities. Amounts received as payments for investment contracts are established as investment contract liability balances and are not reported as premium revenues. Revenues for investment contracts consist of investment income and policy administration charges. Investment contract benefits that are charged to expense include benefit claims incurred in the period in excess of related investment contract liability balances and interest credited to investment contract liability balances. Fees and other revenues are earned for asset management, investment advisory and distribution services provided to retail and institutional clients based largely upon contractual rates applied to the specified amounts in the clients’ portfolios, which include various platforms such as mutual funds, collective investment trusts and business trusts. Additionally, fees and other revenues are earned for administrative services performed including recordkeeping, trust and custody and reporting services for retirement savings plans, insurance companies, endowments and other financial institutions and other products. Fees and other revenues received for performance of asset management and administrative services are recognized as revenue when earned, typically when the service is performed. Fees for managing customers’ mandatory retirement savings accounts in Chile are collected with each monthly deposit made by our customers. If a customer stops contributing before retirement age, we collect no fees but services are still provided. We recognize revenue from these long-term service contracts as services are performed over the life of the contract. |
Deferred Acquisition Costs - Policy | Deferred Acquisition Costs Incremental direct costs of contract acquisition as well as certain costs directly related to acquisition activities (underwriting, policy issuance and processing, medical and inspection and sales force contract selling) for the successful acquisition of new and renewal insurance policies and investment contract business are capitalized to the extent recoverable. Commissions and other incremental direct costs for the acquisition of long-term service contracts are also capitalized to the extent recoverable. Maintenance costs and acquisition costs that are not deferrable are charged to net income as incurred. DAC for universal life-type insurance contracts and certain investment contracts are amortized over the expected lifetime of the contracts in relation to EGPs or, in certain circumstances, estimated gross revenues (“EGR”). This amortization is adjusted in the current period when EGPs or EGRs are revised. EGRs include similar assumptions as the revenue component of EGPs and the changes of future estimates and reflection of actual experience and market conditions is done in the same manner as EGPs. For individual variable universal life insurance, individual variable annuities and group annuities that have separate account U.S. equity investment options, we utilize a mean reversion methodology (reversion to the mean assumption), a common industry practice, to determine the future domestic equity market growth rate assumption used for the calculation of EGPs. DAC for participating life insurance policies are amortized in proportion to estimated gross margins (“EGM”) rather than EGPs. EGMs include similar assumption items as EGPs. We stopped selling participating business in the early 2000s. Some products allow for underwritten death benefit increases and cost of living adjustments, resulting in a small amount of new DAC each year, and the amortization schedules are modified as appropriate. DAC for non-participating term life insurance and individual disability policies are amortized over the premium-paying period of the related policies using assumptions consistent with those used in computing policyholder liabilities. Once these assumptions are made for a given policy or group of policies, they will not be changed over the life of the policy unless a loss recognition event occurs. DAC on insurance policies and investment contracts are subject to recoverability testing at the time of policy issue and loss recognition testing on an annual basis, or when an event occurs that may warrant loss recognition. If loss recognition or impairment is necessary, DAC would be written off to the extent it is determined that future policy premiums and investment income or gross profits are not adequate to cover related losses and expenses. DAC on short-duration group benefits policies are amortized over the estimated term of the underlying contracts. |
Deferred Acquisition Costs on Internal Replacements - Policy | Deferred Acquisition Costs on Internal Replacements All insurance and investment contract modifications and replacements are reviewed to determine if the internal replacement results in a substantially changed contract. If so, the acquisition costs, sales inducements and unearned revenue associated with the new contract are deferred and amortized over the lifetime of the new contract. In addition, the existing DAC, sales inducement costs and unearned revenue balances associated with the replaced contract are written off. If an internal replacement results in a substantially unchanged contract, the acquisition costs, sales inducements and unearned revenue associated with the new contract are immediately recognized in the period incurred. In addition, the existing DAC, sales inducement costs or unearned revenue balance associated with the replaced contract is not written off, but instead is carried over to the new contract. |
Long-Term Debt - Policy | Long-Term Debt Long-term debt includes notes payable, nonrecourse mortgages and other debt with a maturity date greater than one year at the date of issuance. Current maturities of long-term debt are classified as long-term debt in our consolidated statements of financial position. Long-term debt is primarily recorded at the unpaid principal balance, net of unamortized discount, premium and issuance costs. |
Reinsurance - Policy | Reinsurance We enter into reinsurance agreements with other companies in the normal course of business in order to limit losses and minimize exposure to significant risks. Assets and liabilities related to reinsurance ceded are reported on a gross basis. Premiums and expenses are reported net of reinsurance ceded. The cost of reinsurance related to long-duration contracts is accounted for over the life of the underlying reinsured policies using assumptions consistent with those used to account for the underlying policies. We are contingently liable with respect to reinsurance ceded to other companies in the event the reinsurer is unable to meet the obligations it has assumed. As of December 31, 2021 and 2020, we had $1,186.6 million and $1,095.3 million of net ceded reinsurance recoverables, respectively, which does not reflect potentially offsetting impacts of collateral. The reinsurance recoverable is recognized in premiums due and other receivables on the consolidated statements of financial position. As of December 31, 2021 and 2020, $578.0 million, or 95%, and $506.3 million, or 97%, were with our five largest ceded reinsurers, respectively. The effects of reinsurance on premiums and other considerations and policy and contract benefits were as follows: For the year ended December 31, 2021 2020 2019 (in millions) Premiums and other considerations: Direct $ 5,492.1 $ 6,647.1 $ 8,429.7 Ceded (650.6) (609.7) (563.1) Net premiums and other considerations $ 4,841.5 $ 6,037.4 $ 7,866.6 Benefits, claims and settlement expenses: Direct $ 7,766.2 $ 8,810.1 $ 10,486.7 Ceded (669.2) (528.6) (580.9) Net benefits, claims and settlement expenses $ 7,097.0 $ 8,281.5 $ 9,905.8 |
Separate Accounts - Policy | Separate Accounts The separate accounts are legally segregated and are not subject to the claims that arise out of any of our other business. The client, rather than us, directs the investments and bears the investment risk of these funds. The separate account assets represent the fair value of funds that are separately administered by us for contracts with equity, real estate and fixed income investments and are presented as a summary total within the consolidated statements of financial position. An equivalent amount is reported as separate account liabilities, which represent the obligation to return the monies to the client. We receive fees for mortality, withdrawal and expense risks, as well as administrative, maintenance and investment advisory services that are included in the consolidated statements of operations. Net deposits, net investment income and realized and unrealized capital gains and losses of the separate accounts are not reflected in the consolidated statements of operations. Separate account assets and separate account liabilities include certain international retirement accumulation products where the segregated funds and associated obligation to the client are consolidated within our financial statements. We have determined that summary totals are the most meaningful presentation for these funds. As of December 31, 2021 and December 31, 2020, the separate accounts included a separate account valued at $95.1 million and $80.4 million, respectively, which primarily included shares of our stock that were allocated and issued to eligible participants of qualified employee benefit plans administered by us as part of the policy credits issued under our 2001 demutualization. These shares are included in both basic and diluted earnings per share calculations. In the consolidated statements of financial position, the separate account shares are recorded at fair value and are reported as separate account assets with a corresponding separate account liability. Changes in fair value of the separate account shares are reflected in both the separate account assets and separate account liabilities and do not impact our results of operations. |
Income Taxes - Policy | Income Taxes We file a U.S. consolidated income tax return that includes all of our qualifying subsidiaries. In addition, we file income tax returns in all states and foreign jurisdictions in which we conduct business. Our policy of allocating income tax expenses and benefits to companies in the group is generally based upon pro rata contribution of taxable income or operating losses. We are taxed at corporate rates on taxable income based on existing tax laws. Current income taxes are charged or credited to net income based upon amounts estimated to be payable or recoverable as a result of taxable operations for the current year. Deferred income taxes are provided for the tax effect of temporary differences in the financial reporting and income tax bases of assets and liabilities, net operating loss carryforwards and tax credit carryforwards using enacted income tax rates and laws. The effect on deferred income tax assets and deferred income tax liabilities of a change in tax rates is recognized in net income in the period in which the change is enacted. Subsequent to a change in tax rates and laws, any stranded tax effects remaining in AOCI will be released only if an entire portfolio is liquidated, sold or extinguished. |
Foreign Exchange - Policy | Foreign Exchange Assets and liabilities of our foreign subsidiaries and affiliates denominated in non-U.S. dollars, where the U.S. dollar is not the functional currency, are translated into U.S. dollar equivalents at the year-end spot foreign exchange rates. Resulting translation adjustments are reported as a component of stockholders’ equity, along with any related hedge and tax effects. Revenues and expenses for these entities are translated at the average exchange rates. Revenue, expense and other foreign currency transaction and translation adjustments that affect cash flows are reported in net income, along with related hedge and tax effects. |
Goodwill and Other Intangibles - Policy | Goodwill and Other Intangibles Goodwill and other intangible assets include the cost of acquired subsidiaries in excess of the fair value of the net tangible assets recorded in connection with acquisitions. Goodwill and indefinite lived intangible assets are not amortized. Rather, they are tested for impairment during the third quarter each year, or more frequently if events or changes in circumstances indicate that the asset might be impaired. Goodwill is tested at the reporting unit level, which is the same level as or one level below the operating segment, if financial information is prepared and regularly reviewed by management at that level. Once goodwill has been assigned to a reporting unit, it is no longer associated with a particular acquisition; therefore, all of the activities within a reporting unit, whether acquired or organically grown, are available to support the goodwill value. Impairment testing for indefinite-lived intangible assets primarily consists of a qualitative assessment to determine if a quantitative assessment is needed for a comparison of the fair value of the intangible asset with its carrying value. Intangible assets with a finite useful life are amortized as related benefits emerge and are reviewed periodically for indicators of impairment in value. If facts and circumstances suggest possible impairment, the sum of the estimated undiscounted future cash flows expected to result from the use of the asset is compared to the current carrying value of the asset. If the undiscounted future cash flows are less than the carrying value, an impairment loss is recognized for the excess of the carrying amount of assets over their fair value. |
Earnings Per Common Share - Policy | Earnings Per Common Share Basic earnings per common share is calculated by dividing net income available to common stockholders by the weighted-average number of common shares outstanding for the period and excludes the dilutive effect of equity awards. Diluted earnings per common share reflects the potential dilution that could occur if dilutive securities, such as options and non-vested stock grants, were exercised or resulted in the issuance of common stock. |
Nature of Operations and Sign_3
Nature of Operations and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Nature of Operations and Significant Accounting Policies | |
Effects of Reinsurance on Premiums and Other Considerations and Policy and Contract Benefits (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Premiums and other considerations: Direct $ 5,492.1 $ 6,647.1 $ 8,429.7 Ceded (650.6) (609.7) (563.1) Net premiums and other considerations $ 4,841.5 $ 6,037.4 $ 7,866.6 Benefits, claims and settlement expenses: Direct $ 7,766.2 $ 8,810.1 $ 10,486.7 Ceded (669.2) (528.6) (580.9) Net benefits, claims and settlement expenses $ 7,097.0 $ 8,281.5 $ 9,905.8 |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Goodwill and Other Intangible Assets | |
Goodwill (Table) | Retirement Principal U.S. and Income Global Principal Insurance Solutions Investors International Solutions Corporate Consolidated (in millions) Balance as of January 1, 2020 $ 675.9 $ 317.5 $ 642.8 $ 56.6 $ 1.0 $ 1,693.8 Foreign currency — 3.4 13.8 — — 17.2 Balance as of December 31, 2020 675.9 320.9 656.6 56.6 1.0 1,711.0 Goodwill disposed (1) — — (2.3) — — (2.3) Impairment (2) — — — — (1.0) (1.0) Foreign currency — (2.5) (77.6) — — (80.1) Balance as of December 31, 2021 $ 675.9 $ 318.4 $ 576.7 $ 56.6 $ — $ 1,627.6 (1) Relates to the sale of our India asset management business. (2) Relates to the buyout of the minority interest in RobustWealth, Inc. (“RobustWealth”) and realignment of the business. |
Finite Lived Intangible Assets (Table) | December 31, 2021 2020 (in millions) Gross carrying value $ 1,262.8 $ 1,338.2 Accumulated amortization 432.1 405.6 Net carrying value $ 830.7 $ 932.6 |
Other Finite Lived Intangible Assets Estimated Amortization Expense (Table) | Year ending December 31: 2022 $ 71.1 2023 68.3 2024 67.0 2025 60.7 2026 56.6 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Variable Interest Entities | |
Carrying Amounts of Assets and Liabilities of Consolidated Variable Interest Entities (Table) | December 31, 2021 December 31, 2020 Total Total Total Total assets liabilities assets liabilities (in millions) Mandatory retirement savings funds (1) $ 34,687.0 $ 34,301.8 $ 41,995.2 $ 41,527.9 Real estate (2) 709.6 36.1 499.0 21.3 Sponsored investment funds (3) 609.4 2.5 419.5 3.2 Residential mortgage loans (4) 1,263.2 20.3 319.8 — Total $ 37,269.2 $ 34,360.7 $ 43,233.5 $ 41,552.4 (1) The assets of the mandatory retirement savings funds primarily include separate account assets and equity securities. The liabilities primarily include separate account liabilities and contractholder funds. (2) The assets of the real estate VIEs primarily include real estate and cash. Liabilities primarily include other liabilities. (3) The assets of sponsored investment funds are primarily fixed maturities and equity securities, certain of which are reported with other investments, and cash. The consolidated statements of financial position included a $304.0 million and $226.8 million redeemable noncontrolling interest for sponsored investment funds as of December 31, 2021 and December 31, 2020, respectively. (4) The assets of the residential mortgage loans VIEs primarily include residential mortgage loans. The liabilities include other liabilities as of December 31, 2021. |
Asset Carrying Value and Maximum Loss Exposure of Unconsolidated Variable Interest Entities (Table) | Maximum exposure to Asset carrying value loss (1) (in millions) December 31, 2021 Fixed maturities, available-for-sale: Corporate $ 142.1 $ 136.9 Residential mortgage-backed pass-through securities 3,152.9 3,122.3 Commercial mortgage-backed securities 5,562.2 5,436.2 Collateralized debt obligations (2) 3,559.6 3,564.7 Other debt obligations 7,560.4 7,487.8 Fixed maturities, trading: Residential mortgage-backed pass-through securities 117.4 117.4 Commercial mortgage-backed securities 25.6 25.6 Collateralized debt obligations (2) 7.5 7.5 Other debt obligations 8.2 8.2 Equity securities 115.4 115.4 Other investments: Other limited partnership and fund interests (3) 1,209.6 2,053.8 December 31, 2020 Fixed maturities, available-for-sale: Corporate $ 296.9 $ 285.7 Residential mortgage-backed pass-through securities 2,986.8 2,857.6 Commercial mortgage-backed securities 4,942.3 4,741.2 Collateralized debt obligations (2) 4,027.5 4,045.9 Other debt obligations 7,045.9 6,832.6 Fixed maturities, trading: Residential mortgage-backed pass-through securities 190.5 190.5 Commercial mortgage-backed securities 27.1 27.1 Collateralized debt obligations (2) 20.6 20.6 Other debt obligations 9.4 9.4 Equity securities 121.7 121.7 Other investments: Other limited partnership and fund interests (3) 999.1 1,739.0 (1) Our risk of loss is limited to our initial investment measured at amortized cost for fixed maturities, available-for-sale. Our risk of loss is limited to our investment measured at fair value for our fixed maturities, trading and equity securities. Our risk of loss is limited to our carrying value plus any unfunded commitments and/or guarantees and similar provisions for our other investments. A carrying value of zero is used if distributions have been received in excess of our investment, resulting in a negative carrying value for the investment. Unfunded commitments are not liabilities on our consolidated statements of financial position because we are only required to fund additional equity when called upon to do so by the general partner or investment manager . (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. (3) As of December 31, 2021 and December 31, 2020, the maximum exposure to loss for other limited partnership and fund interests includes $130.5 million and $141.2 million, respectively, of debt within certain of our managed international real estate funds that is fully secured by assets whose value exceeds the amount of the debt, but also includes recourse to the investment manager. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Investments | |
Available-for-Sale Securities (Table) | Gross Gross Allowance Amortized unrealized unrealized for credit cost (1) gains losses loss Fair value (in millions) December 31, 2021 Fixed maturities, available-for-sale: U.S. government and agencies $ 1,978.0 $ 148.0 $ 37.4 $ — $ 2,088.6 Non-U.S. governments 851.0 133.1 2.1 — 982.0 States and political subdivisions 8,290.7 1,030.3 16.6 — 9,304.4 Corporate 42,139.2 4,044.8 224.5 15.1 45,944.4 Residential mortgage-backed pass-through securities 3,122.3 59.0 28.4 — 3,152.9 Commercial mortgage-backed securities 5,436.2 157.8 31.5 0.3 5,562.2 Collateralized debt obligations (2) 3,564.7 4.5 9.6 — 3,559.6 Other debt obligations 7,487.8 131.1 58.4 0.1 7,560.4 Total fixed maturities, available-for-sale $ 72,869.9 $ 5,708.6 $ 408.5 $ 15.5 $ 78,154.5 Gross Gross Allowance Amortized unrealized unrealized for credit cost (1) gains losses loss Fair value (in millions) December 31, 2020 Fixed maturities, available-for-sale: U.S. government and agencies $ 1,893.1 $ 228.9 $ 10.5 $ — $ 2,111.5 Non-U.S. governments 881.6 192.1 — — 1,073.7 States and political subdivisions 8,004.9 1,175.5 12.6 — 9,167.8 Corporate 41,289.9 6,160.9 95.1 0.9 47,354.8 Residential mortgage-backed pass-through securities 2,857.6 129.4 0.2 — 2,986.8 Commercial mortgage-backed securities 4,741.2 241.3 35.9 4.3 4,942.3 Collateralized debt obligations (2) 4,045.9 8.7 24.9 2.2 4,027.5 Other debt obligations 6,832.6 243.2 29.9 — 7,045.9 Total fixed maturities, available-for-sale $ 70,546.8 $ 8,380.0 $ 209.1 $ 7.4 $ 78,710.3 (1) Amortized cost excludes accrued interest receivable of $542.6 million and $552.5 million as of December 31, 2021 and December 31, 2020, respectively. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. |
Fixed Maturities Available-for-Sale by Contractual Maturity (Table) | Amortized cost Fair value (in millions) Due in one year or less $ 1,647.3 $ 1,666.8 Due after one year through five years 11,267.1 11,749.9 Due after five years through ten years 14,795.7 15,797.6 Due after ten years 25,548.8 29,105.1 Subtotal 53,258.9 58,319.4 Mortgage-backed and other asset-backed securities 19,611.0 19,835.1 Total $ 72,869.9 $ 78,154.5 |
Net Investment Income (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Fixed maturities, available-for-sale $ 2,766.3 $ 2,660.5 $ 2,606.0 Fixed maturities, trading 19.3 18.7 23.8 Equity securities 57.7 62.8 110.5 Mortgage loans 790.2 724.7 707.0 Real estate 194.4 180.8 191.1 Policy loans 38.8 41.6 44.0 Cash and cash equivalents 4.3 17.4 65.3 Derivatives 28.2 (1.8) (2.0) Other 622.0 296.5 370.8 Total 4,521.2 4,001.2 4,116.5 Investment expenses (115.1) (110.6) (118.1) Net investment income $ 4,406.1 $ 3,890.6 $ 3,998.4 |
Net Realized Capital Gains and Losses (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Fixed maturities, available-for-sale: Gross gains $ 64.4 $ 134.2 $ 15.5 Gross losses (29.2) (48.5) (15.3) Net credit losses (1) (45.0) (22.9) (43.5) Hedging, net (9.5) (9.7) (9.3) Fixed maturities, trading (2) (33.3) 3.2 43.0 Equity securities (3) 100.0 70.5 84.5 Mortgage loans 6.5 (15.5) 3.0 Derivatives (116.9) 77.3 (120.3) Other 65.5 114.0 (10.4) Net realized capital gains (losses) $ 2.5 $ 302.6 $ (52.8) (1) Upon adoption of authoritative guidance effective January 1, 2020, net credit losses include adjustments to the credit loss valuation allowance, write-offs and recoveries on available-for-sale securities. Prior to 2020, net credit losses included net other-than-temporary impairment losses and recoveries on available-for-sale securities. (2) Unrealized gains (losses) on fixed maturities, trading still held at the reporting date were $(32.2) million, $5.3 million and $32.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. (3) Unrealized gains on equity securities still held at the reporting date were $58.6 million, $64.6 million and $61.6 million for the years ended December 31, 2021, 2020 and 2019, respectively. This excludes $28.7 million, $35.2 million and $66.9 million of unrealized gains on equity securities still held at the reporting date for the years ended December 31, 2021, 2020 and 2019, respectively, that were reported in net investment income. |
Allowance for credit loss (Tables) | For the year ended December 31, 2021 Residential mortgage- backed Commercial Collateralized U.S. States and pass- mortgage- debt Other government Non-U.S. political through backed obligations debt and agencies governments subdivisions Corporate securities securities (1) obligations Total (in millions) Beginning balance $ — $ — $ — $ 0.9 $ — $ 4.3 $ 2.2 $ — $ 7.4 Additions for credit losses not previously recorded — — — 27.5 — 0.4 — 0.1 28.0 Reductions for securities sold during the period — — — (12.4) — — — — (12.4) Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period — — — — — 2.4 0.4 — 2.8 Write-offs charged against allowance — — — — — (6.8) (2.6) — (9.4) Foreign currency translation adjustment — — — (0.9) — — — — (0.9) Ending balance $ — $ — $ — $ 15.1 $ — $ 0.3 $ — $ 0.1 $ 15.5 Accrued interest written off to net investment income $ — $ — $ — $ 0.2 $ — $ — $ — $ — $ 0.2 For the year ended December 31, 2020 Residential mortgage- backed Commercial Collateralized U.S. States and pass- mortgage- debt Other government Non-U.S. political through backed obligations debt and agencies governments subdivisions Corporate securities securities (1) obligations Total (in millions) Beginning balance (2) $ — $ — $ — $ — $ — $ — $ — $ — $ — Additions for credit losses not previously recorded — — — 13.2 — 2.9 0.1 — 16.2 Reductions for securities sold during the period — — — (7.0) — — — — (7.0) Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period — — — (5.9) — 4.0 2.1 — 0.2 Write-offs charged against allowance — — — — — (2.6) — — (2.6) Foreign currency translation adjustment — — — 0.6 — — — — 0.6 Ending balance $ — $ — $ — $ 0.9 $ — $ 4.3 $ 2.2 $ — $ 7.4 (1) Primarily consists of collateralized loan obligations backed by secured corporate loans. (2) The allowance for credit loss associated with fixed maturities, available-for-sale was applied prospectively upon adoption of authoritative guidance effective January 1, 2020. |
Other-Than-Temporary Impairment Losses, Net of Recoveries (Table) | For the year ended December 31, 2019 (in millions) Net realized capital losses, excluding impairment losses on available-for-sale securities $ (9.3) Net other-than-temporary impairment losses on available-for-sale securities (38.3) Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified from other comprehensive income (1) (5.2) Net impairment losses on available-for-sale securities (43.5) Net realized capital losses $ (52.8) (1) Represents the net impact of (a) gains resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI and (b) losses resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold. |
Other-Than-Temporary Impairment, Credit Losses Recognized in Earnings (Table) | For the year ended December 31, 2019 (in millions) Beginning balance $ (117.5) Credit losses for which an other-than-temporary impairment was not previously recognized (6.8) Credit losses for which an other-than-temporary impairment was previously recognized (11.8) Reduction for credit losses previously recognized on fixed maturities now sold, paid down or intended to be sold 54.3 Net reduction for positive changes in cash flows expected to be collected and amortization (1) 0.8 Ending balance $ (81.0) (1) Amounts are recognized in net investment income. |
Available-for-Sale Securities in Unrealized Loss Positions Without an Allowance for Credit Loss (Table) | December 31, 2021 Less than Greater than or twelve months equal to twelve months Total Gross Gross Gross Fair unrealized Fair unrealized Fair unrealized value losses value losses value losses (in millions) Fixed maturities, available-for-sale(1): U.S. government and agencies $ 129.3 $ 3.4 $ 482.9 $ 34.0 $ 612.2 $ 37.4 Non-U.S. governments 57.8 2.0 — — 57.8 2.0 States and political subdivisions 690.2 10.5 102.3 6.1 792.5 16.6 Corporate 5,281.6 121.2 1,327.5 101.5 6,609.1 222.7 Residential mortgage-backed pass- through securities 1,562.6 22.2 194.9 6.3 1,757.5 28.5 Commercial mortgage-backed securities 1,297.4 15.6 299.6 15.7 1,597.0 31.3 Collateralized debt obligations (2) 1,592.5 2.8 424.4 6.7 2,016.9 9.5 Other debt obligations 3,949.9 49.4 211.0 9.0 4,160.9 58.4 Total fixed maturities, available-for-sale $ 14,561.3 $ 227.1 $ 3,042.6 $ 179.3 $ 17,603.9 $ 406.4 (1) Fair value and gross unrealized losses are excluded for available-for-sale securities for which an allowance for credit loss has been recorded. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. December 31, 2020 Less than Greater than or twelve months equal to twelve months Total Gross Gross Gross Fair unrealized Fair unrealized Fair unrealized value losses value losses value losses (in millions) Fixed maturities, available-for-sale (1): U.S. government and agencies $ 351.1 $ 10.4 $ — $ — $ 351.1 $ 10.4 States and political subdivisions 363.5 12.5 — — 363.5 12.5 Corporate 1,578.7 54.4 267.9 40.6 1,846.6 95.0 Residential mortgage-backed pass- through securities 92.3 0.2 1.6 — 93.9 0.2 Commercial mortgage-backed securities 970.9 22.1 137.4 12.2 1,108.3 34.3 Collateralized debt obligations (2) 1,750.6 11.1 931.1 12.9 2,681.7 24.0 Other debt obligations 802.3 28.1 61.1 1.7 863.4 29.8 Total fixed maturities, available-for-sale $ 5,909.4 $ 138.8 $ 1,399.1 $ 67.4 $ 7,308.5 $ 206.2 (1) Fair value and gross unrealized losses are excluded for available-for-sale securities for which an allowance for credit loss has been recorded. (2) Primarily consists of collateralized loan obligations backed by secured corporate loans. |
Net Unrealized Gains and Losses on Available-for-Sale Securities and Derivative Instruments (Table) | December 31, 2021 December 31, 2020 (in millions) Net unrealized gains on fixed maturities, available-for-sale (1) $ 5,289.9 $ 8,193.0 Net unrealized gains on derivative instruments 80.1 38.9 Adjustments for assumed changes in amortization patterns (266.1) (437.3) Adjustments for assumed changes in policyholder liabilities (689.2) (2,603.9) Net unrealized gains on other investments and noncontrolling interest adjustments 40.5 78.0 Provision for deferred income taxes (936.0) (1,112.2) Net unrealized gains on available-for-sale securities and derivative instruments $ 3,519.2 $ 4,156.5 (1) Excludes net unrealized gains (losses) on fixed maturities, available-for-sale included in fair value hedging relationships. |
Financing Receivable Credit Quality Indicators (Table) | As of December 31, 2021 2021 2020 2019 2018 2017 Prior Total (in millions) Commercial mortgage loans: A- and above $ 2,275.9 $ 1,722.7 $ 2,412.9 $ 2,383.3 $ 1,437.2 $ 4,334.2 $ 14,566.2 BBB+ thru BBB- 278.6 305.6 294.0 131.4 302.1 380.0 1,691.7 BB+ thru BB- 32.8 5.3 — — — 55.4 93.5 B+ and below — — — 8.8 — 34.5 43.3 Total $ 2,587.3 $ 2,033.6 $ 2,706.9 $ 2,523.5 $ 1,739.3 $ 4,804.1 $ 16,394.7 Direct financing leases: A- and above $ 11.7 $ 41.8 $ 1.4 $ 39.4 $ 16.6 $ 235.6 $ 346.5 BBB+ thru BBB- 30.2 57.9 22.0 17.9 15.5 50.2 193.7 BB+ thru BB- 50.8 13.4 1.9 — — 2.1 68.2 B+ and below 1.5 — — — — — 1.5 Total $ 94.2 $ 113.1 $ 25.3 $ 57.3 $ 32.1 $ 287.9 $ 609.9 Residential mortgage loans: Performing $ 2,039.1 $ 510.1 $ 155.6 $ 91.2 $ 102.4 $ 415.6 $ 3,314.0 Non-performing — 1.8 0.6 — 0.8 2.7 5.9 Total $ 2,039.1 $ 511.9 $ 156.2 $ 91.2 $ 103.2 $ 418.3 $ 3,319.9 Reinsurance recoverables $ 1,189.3 As of December 31, 2020 2020 2019 2018 2017 2016 Prior Total (in millions) Commercial mortgage loans: A- and above $ 1,807.6 $ 2,486.8 $ 2,464.7 $ 1,780.8 $ 1,417.8 $ 3,697.0 $ 13,654.7 BBB+ thru BBB- 149.1 194.1 352.5 262.7 75.8 499.7 1,533.9 BB+ thru BB- 23.7 69.0 — — 9.1 43.9 145.7 B+ and below 39.4 20.0 — 5.8 6.6 35.5 107.3 Total $ 2,019.8 $ 2,769.9 $ 2,817.2 $ 2,049.3 $ 1,509.3 $ 4,276.1 $ 15,441.6 Direct financing leases: A- and above $ 43.9 $ 1.6 $ 42.6 $ 19.2 $ 15.3 $ 202.9 $ 325.5 BBB+ thru BBB- 94.9 5.5 11.3 18.4 3.0 35.5 168.6 BB+ thru BB- 13.3 — — — — 1.9 15.2 B+ and below 57.6 22.5 11.9 — 1.0 108.5 201.5 Total $ 209.7 $ 29.6 $ 65.8 $ 37.6 $ 19.3 $ 348.8 $ 710.8 Residential mortgage loans: Performing $ 699.1 $ 336.7 $ 167.0 $ 165.1 $ 167.6 $ 398.7 $ 1,934.2 Non-performing — 2.0 0.8 1.4 0.4 12.7 17.3 Total $ 699.1 $ 338.7 $ 167.8 $ 166.5 $ 168.0 $ 411.4 $ 1,951.5 Reinsurance recoverables $ 1,098.0 |
Non-Accrual Financing Receivables (Table) | December 31, 2021 Amortized cost Beginning Ending of nonaccrual amortized cost amortized cost assets without on nonaccrual on nonaccrual a valuation status status allowance (in millions) Commercial mortgage loans $ 10.7 $ 13.2 $ — Residential mortgage loans 10.8 4.0 0.7 Total $ 21.5 $ 17.2 $ 0.7 December 31, 2020 Amortized cost Beginning Ending of nonaccrual amortized cost amortized cost assets without on nonaccrual on nonaccrual a valuation status status allowance (in millions) Commercial mortgage loans $ 5.0 $ 10.7 $ — Residential mortgage loans 6.8 10.8 0.7 Total $ 11.8 $ 21.5 $ 0.7 |
Financing Receivables Aging (Table) | December 31, 2021 Amortized cost 90 days or 90 days or 30-59 days 60-89 days more past Total more and past due past due due past due Current Total (1) accruing (in millions) Commercial mortgage loans $ 0.7 $ — $ 7.1 $ 7.8 $ 16,386.9 $ 16,394.7 $ 2.7 Direct financing leases — 1.9 0.7 2.6 607.3 609.9 0.7 Residential mortgage loans 59.2 9.6 5.2 74.0 3,245.9 3,319.9 1.9 Total $ 59.9 $ 11.5 $ 13.0 $ 84.4 $ 20,240.1 $ 20,324.5 $ 5.3 December 31, 2020 Amortized cost 90 days or 90 days or 30-59 days 60-89 days more past Total more and past due past due due past due Current Total (1) accruing (in millions) Commercial mortgage loans $ 42.1 $ 9.2 $ 12.0 $ 63.3 $ 15,378.3 $ 15,441.6 $ 1.3 Direct financing leases — 3.2 — 3.2 707.6 710.8 — Residential mortgage loans 66.6 8.8 10.9 86.3 1,865.2 1,951.5 6.5 Total $ 108.7 $ 21.2 $ 22.9 $ 152.8 $ 17,951.1 $ 18,103.9 $ 7.8 (1) As of both December 31, 2021 and December 31, 2020, no reinsurance recoverables were considered past due. |
Financing Receivables Valuation Allowance (Table) | For the year ended December 31, 2021 Direct Commercial financing Residential Reinsurance mortgage loans leases mortgage loans recoverables Total (in millions) Beginning balance $ 43.2 $ 0.1 $ 6.9 $ 2.7 $ 52.9 Provision (1) 1.0 0.4 (8.0) — (6.6) Charge-offs — — (0.5) — (0.5) Recoveries — — 3.6 — 3.6 Foreign currency translation adjustment (0.3) (0.1) — — (0.4) Ending balance $ 43.9 $ 0.4 $ 2.0 $ 2.7 $ 49.0 For the year ended December 31, 2020 Direct Commercial financing Residential Reinsurance mortgage loans leases mortgage loans recoverables Total (in millions) Beginning balance (3) $ 27.3 $ — $ 3.3 $ 2.5 $ 33.1 Provision (2) 15.5 0.1 1.5 0.2 17.3 Charge-offs — — (0.9) — (0.9) Recoveries — — 2.8 — 2.8 Foreign currency translation adjustment 0.4 — 0.2 — 0.6 Ending balance $ 43.2 $ 0.1 $ 6.9 $ 2.7 $ 52.9 Commercial Residential Total (in millions) For the year ended December 31, 2019 (4) Beginning balance $ 24.3 $ 3.1 $ 27.4 Provision 0.2 (3.2) (3.0) Charge-offs — (0.6) (0.6) Recoveries — 3.2 3.2 Ending balance $ 24.5 $ 2.5 $ 27.0 Allowance ending balance by basis of impairment method: Individually evaluated for impairment $ — $ 1.4 $ 1.4 Collectively evaluated for impairment 24.5 1.1 25.6 Allowance ending balance $ 24.5 $ 2.5 $ 27.0 Loan balance by basis of impairment method: Individually evaluated for impairment $ — $ 11.4 $ 11.4 Collectively evaluated for impairment 15,017.2 1,485.3 16,502.5 Loan ending balance $ 15,017.2 $ 1,496.7 $ 16,513.9 (1) During the year ended December 31, 2021, certain valuation allowances for residential mortgage loans were released. This release was a result of further adjustments to our current and forecasted environmental factors management believed to be relevant as global economic activity improved from previously adverse impacts due to COVID-19. (2) During the year ended December 31, 2020, COVID-19 adversely impacted global economic activity and contributed to significant volatility in financial markets. As a result, certain current and forecasted environmental factors management believed to be relevant were adjusted, resulting in an increase in the valuation allowance for commercial and residential mortgage loans and direct financing leases. (3) Upon adoption of authoritative guidance effective January 1, 2020, we updated accounting policies and methodology, adjusted the commercial and residential mortgage loan valuation allowance and established a valuation allowance for reinsurance recoverables. See Note 1, Nature of Operations and Significant Accounting Policies under the caption, “Recent Accounting Pronouncements” for further details. (4) Prior to the implementation of authoritative guidance in 2020, only commercial and residential mortgage loans were included in the allowance rollforward and the allowance was based on either individual or collective evaluation. |
Mortgage Loans Purchased and Sold (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Commercial mortgage loans: Purchased $ 118.2 $ 166.8 $ 200.5 Sold 73.8 7.6 1.6 Residential mortgage loans: Purchased (1) 2,370.9 1,151.1 489.2 Sold 88.9 117.4 70.7 (1) Includes mortgage loans purchased by residential mortgage loan VIEs established in 2021 and 2020. |
Commercial Mortgage Loans by Geographic Distribution and Property Type Distribution (Table) | December 31, 2021 December 31, 2020 Amortized Percent Amortized Percent cost of total cost of total ($ in millions) Geographic distribution New England $ 585.6 3.6 % $ 593.9 3.8 % Middle Atlantic 4,536.5 27.7 4,438.2 28.8 East North Central 623.9 3.8 572.6 3.7 West North Central 338.6 2.1 267.5 1.7 South Atlantic 2,464.9 15.0 2,368.9 15.3 East South Central 378.9 2.3 316.6 2.1 West South Central 1,243.7 7.6 1,315.9 8.5 Mountain 925.6 5.6 936.2 6.1 Pacific 4,864.4 29.7 4,183.0 27.1 International 432.6 2.6 448.8 2.9 Total $ 16,394.7 100.0 % $ 15,441.6 100.0 % Property type distribution Office $ 4,789.8 29.3 % $ 4,491.7 29.0 % Retail 1,622.1 9.9 1,815.3 11.8 Industrial 2,966.4 18.1 2,488.7 16.1 Apartments 6,234.3 38.0 5,958.0 38.6 Hotel 85.7 0.5 89.4 0.6 Mixed use/other 696.4 4.2 598.5 3.9 Total $ 16,394.7 100.0 % $ 15,441.6 100.0 % |
Minority Interests in Unconsolidated Entities-Balance Sheet (Table) | December 31, 2021 2020 (in millions) Total assets $ 177,429.0 $ 155,724.1 Total liabilities 72,001.3 73,438.2 Total equity $ 105,427.7 $ 82,285.9 Net investment in unconsolidated entities (1) $ 2,162.5 $ 1,912.9 |
Minority Interests in Unconsolidated Entities-Income Statement (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Total revenues $ 21,769.6 $ 14,989.0 $ 17,802.2 Net income 15,638.5 7,757.0 7,938.3 Our share of net income of unconsolidated entities (1) 383.0 143.9 222.5 (1) Our most significant equity investee is Brasilprev Seguros e Previdencia, a co-managed joint venture in Brazil. |
Financial Assets Subject to Netting Agreements (Table) | Gross amounts not offset in the consolidated statements of financial position Gross amount of recognized Financial Collateral assets (1) instruments (2) received Net amount (in millions) December 31, 2021 Derivative assets $ 337.1 $ (100.1) $ (229.7) $ 7.3 Reverse repurchase agreements 16.4 — (16.4) — Total $ 353.5 $ (100.1) $ (246.1) $ 7.3 December 31, 2020 Derivative assets $ 463.5 $ (132.5) $ (293.5) $ 37.5 Reverse repurchase agreements 63.7 — (63.7) — Total $ 527.2 $ (132.5) $ (357.2) $ 37.5 (1) The gross amount of recognized derivative and reverse repurchase agreement assets are reported with other investments and cash and cash equivalents, respectively, on the consolidated statements of financial position. The gross amounts of derivative and reverse repurchase agreement assets are not netted against offsetting liabilities for presentation on the consolidated statements of financial position. (2) Represents amount of offsetting derivative liabilities that are subject to an enforceable master netting agreement or similar agreement that are not netted against the gross derivative assets for presentation on the consolidated statements of financial position. |
Financial Liabilities Subject to Netting Agreements (Table) | Gross amounts not offset in the consolidated statements of financial position Gross amount of recognized Financial Collateral liabilities (1) instruments (2) pledged Net amount (in millions) December 31, 2021 Derivative liabilities $ 225.3 $ (100.1) $ (115.2) $ 10.0 December 31, 2020 Derivative liabilities $ 186.2 $ (132.5) $ (45.7) $ 8.0 (1) The gross amount of recognized derivative liabilities is reported with other liabilities on the consolidated statements of financial position. The above excludes $357.0 million and $467.8 million of derivative liabilities as of December 31, 2021 and December 31, 2020, respectively, which are primarily embedded derivatives that are not subject to master netting agreements or similar agreements. The gross amounts of derivative liabilities are not netted against offsetting assets for presentation on the consolidated statements of financial position. (2) Represents amount of offsetting derivative assets that are subject to an enforceable master netting agreement or similar agreement that are not netted against the gross derivative liabilities for presentation on the consolidated statements of financial position. |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Derivative Financial Instruments | |
Derivative Financial Instruments, Exposure (Table) | December 31, 2021 December 31, 2020 (in millions) Notional amounts of derivative instruments Interest rate contracts: Interest rate swaps $ 47,927.4 $ 44,472.1 Interest rate options 2,373.9 2,083.9 Interest rate forwards 2,181.6 1,000.0 Interest rate futures 1,774.5 188.5 Swaptions — 62.0 Foreign exchange contracts: Currency swaps 1,242.7 1,045.5 Currency forwards 1,043.6 1,115.8 Equity contracts: Equity options 2,378.2 1,857.8 Equity futures 150.4 218.1 Credit contracts: Credit default swaps 295.0 295.0 Other contracts: Embedded derivatives 10,060.8 9,953.8 Total notional amounts at end of period $ 69,428.1 $ 62,292.5 Credit exposure of derivative instruments Interest rate contracts: Interest rate swaps $ 205.9 $ 291.0 Interest rate options 24.5 51.0 Interest rate forwards 15.3 6.2 Foreign exchange contracts: Currency swaps 51.1 43.3 Currency forwards 11.3 45.4 Equity contracts: Equity options 37.3 33.2 Credit contracts: Credit default swaps 2.7 3.4 Total gross credit exposure 348.1 473.5 Less: collateral received 244.6 294.7 Net credit exposure $ 103.5 $ 178.8 |
Derivative Financial Instruments, Fair Value Disclosures (Table) | Derivative assets (1) Derivative liabilities (2) December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 (in millions) Derivatives designated as hedging instruments Interest rate contracts $ 4.1 $ — $ 19.0 $ 27.8 Foreign exchange contracts 48.4 21.1 17.6 44.7 Total derivatives designated as hedging instruments $ 52.5 $ 21.1 $ 36.6 $ 72.5 Derivatives not designated as hedging instruments Interest rate contracts $ 233.4 $ 339.3 $ 13.0 $ 33.0 Foreign exchange contracts 11.3 66.5 83.3 29.2 Equity contracts 37.3 33.2 90.9 49.0 Credit contracts 2.6 3.4 2.2 2.5 Other contracts — — 356.3 467.8 Total derivatives not designated as hedging instruments 284.6 442.4 545.7 581.5 Total derivative instruments $ 337.1 $ 463.5 $ 582.3 $ 654.0 (1) The fair value of derivative assets is reported with other investments on the consolidated statements of financial position. (2) The fair value of derivative liabilities is reported with other liabilities on the consolidated statements of financial position, with the exception of certain embedded derivative liabilities. Embedded derivatives with a net liability fair value of $356.3 million and $467.8 million as of December 31, 2021 and December 31, 2020, respectively, are reported with contractholder funds on the consolidated statements of financial position. |
Credit Derivatives Sold (Table) | December 31, 2021 Weighted Maximum average Notional Fair future expected life amount value payments (in years) (in millions) Single name credit default swaps Corporate debt A $ 20.0 $ 0.4 $ 20.0 3.5 BBB 110.0 1.7 110.0 3.0 Sovereign A 20.0 0.5 20.0 3.5 Total credit default swap protection sold $ 150.0 $ 2.6 $ 150.0 3.1 December 31, 2020 Weighted Maximum average Notional Fair future expected life amount value payments (in years) (in millions) Single name credit default swaps Corporate debt A $ 20.0 $ 0.5 $ 20.0 4.5 BBB 115.0 2.1 115.0 3.9 Sovereign A 20.0 0.6 20.0 4.5 BBB 15.0 0.1 15.0 1.0 Total credit default swap protection sold $ 170.0 $ 3.3 $ 170.0 3.8 |
Fair Value Hedges (Table) | Cumulative amount of fair value hedging basis adjustment Line item in the consolidated statements increase/(decrease) included in the of financial position in which the Amortized cost of hedged item amortized cost of the hedged item hedged item is included December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020 (in millions) Fixed maturities, available-for-sale (1): Active hedging relationships $ 1,859.9 $ 476.1 $ (7.1) $ 21.4 Discontinued hedging relationships 79.7 135.1 2.8 5.2 Total fixed maturities, available-for-sale in active or discontinued hedging relationships $ 1,939.6 $ 611.2 $ (4.3) $ 26.6 (1) These amounts include the amortized cost basis of closed portfolios used to designate last-of-layer hedging relationships in which the hedged last layer amount is expected to remain at the end of the hedging relationship. As of December 31, 2021 and December 31, 2020, the amortized cost basis of the closed portfolios used in these hedging relationships was $1,390.4 million and $0.0 million, respectively, the cumulative basis adjustments associated with these hedging relationships was $(3.9) million and $0.0 million, respectively, and the amount of the designated hedged items were $510.0 million and $0.0 million, respectively. |
Cash Flow Hedges (Table) | Amount of gain (loss) recognized in AOCI on derivatives Derivatives in cash flow for the year ended December 31, hedging relationships Related hedged item 2021 2020 2019 (in millions) Interest rate contracts Fixed maturities, available-for-sale $ — $ (3.0) $ (9.9) Interest rate contracts Investment contracts 4.1 — — Foreign exchange contracts Fixed maturities, available-for-sale 53.4 (37.1) (9.4) Total $ 57.5 $ (40.1) $ (19.3) |
Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations (Table) | For the year ended December 31, 2021 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 4,406.1 $ 2.5 $ 7,097.0 $ 4,987.3 Losses on fair value hedging relationships: Interest rate contracts: Loss recognized on hedged item $ (28.7) $ — $ — $ — Gain recognized on derivatives 28.6 — — — Amortization of hedged item basis adjustments (1.8) — — — Amounts related to periodic settlements on derivatives (10.0) — — — Total loss recognized for fair value hedging relationships $ (11.9) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 15.4 $ — $ (0.1) $ — Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 1.0 — — Amounts related to periodic settlements on derivatives — — (0.4) — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 9.2 — — Amounts related to periodic settlements on derivatives 9.6 — — — Total gain (loss) recognized for cash flow hedging relationships $ 25.0 $ 10.2 $ (0.5) $ — For the year ended December 31, 2020 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 3,890.6 $ 302.6 $ 8,281.5 $ 4,646.5 Losses on fair value hedging relationships: Interest rate contracts: Gain recognized on hedged item $ 3.3 $ — $ — $ — Loss recognized on derivatives (3.8) — — — Amortization of hedged item basis adjustments (2.5) — — — Amounts related to periodic settlements on derivatives (6.2) — — — Total loss recognized for fair value hedging relationships $ (9.2) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 18.1 $ 2.7 $ (0.1) $ — Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 0.1 — — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 6.3 — — Amounts related to periodic settlements on derivatives 8.2 — — — Total gain (loss) recognized for cash flow hedging relationships $ 26.3 $ 9.1 $ (0.1) $ — For the year ended December 31, 2019 Benefits, Net investment Net realized claims and income related capital gains settlement to hedges (losses) related to expenses of fixed hedges of fixed related to Operating maturities, maturities, hedges of expenses available- available- investment related to for-sale for-sale contracts hedges of debt (in millions) Total amounts of consolidated statement of operations line items in which the effects of fair value and cash flow hedges are reported $ 3,998.4 $ (52.8) $ 9,905.8 $ 4,503.9 Losses on fair value hedging relationships: Interest rate contracts: Gain recognized on hedged item $ 5.7 $ — $ — $ — Loss recognized on derivatives (6.0) — — — Amortization of hedged item basis adjustments (4.2) — — — Amounts related to periodic settlements on derivatives (3.4) — — — Total loss recognized for fair value hedging relationships $ (7.9) $ — $ — $ — Gains (losses) on cash flow hedging relationships: Interest rate contracts: Gain (loss) reclassified from AOCI on derivatives $ 19.8 $ (0.6) $ (0.1) $ (4.8) Gain reclassified from AOCI as a result that a forecasted transaction is no longer probable of occurring — 0.1 — — Foreign exchange contracts: Gain reclassified from AOCI on derivatives — 9.5 — — Amounts related to periodic settlements on derivatives 7.4 — — — Total gain (loss) recognized for cash flow hedging relationships $ 27.2 $ 9.0 $ (0.1) $ (4.8) |
Net Investment Hedges (Table) | Amount of gain recognized in AOCI on derivatives for the year ended December 31, Derivatives in net investment hedging relationships 2021 2020 2019 (in millions) Foreign exchange contracts $ 2.9 $ 7.9 $ — Total $ 2.9 $ 7.9 $ — Amount of gain reclassified from AOCI into net realized capital gains (losses) for the year ended December 31, Derivatives in net investment hedging relationships 2021 2020 2019 (in millions) Foreign exchange contracts $ — $ (7.1) $ — Total $ — $ (7.1) $ — |
Derivatives Not Designated as Hedging Instruments (Table) | Amount of gain (loss) recognized in net income on derivatives for the year ended December 31, Derivatives not designated as hedging instruments 2021 2020 2019 (in millions) Interest rate contracts $ (46.6) $ 346.5 $ 218.0 Foreign exchange contracts (121.9) 54.7 (58.6) Equity contracts (81.5) (96.6) (132.9) Credit contracts 0.1 1.8 (3.6) Other contracts 103.7 (255.5) (168.1) Total $ (146.2) $ 50.9 $ (145.2) |
Closed Block (Tables)
Closed Block (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Closed Block | |
Closed Block Liabilities and Assets Designated to the Closed Block (Table) | December 31, 2021 December 31, 2020 (in millions) Closed Block liabilities Future policy benefits and claims $ 3,286.0 $ 3,423.2 Other policyholder funds 5.3 6.0 Policyholder dividends payable 176.6 189.0 Policyholder dividends obligation 210.7 298.2 Other liabilities 8.8 8.7 Total Closed Block liabilities 3,687.4 3,925.1 Assets designated to the Closed Block Fixed maturities, available-for-sale 2,191.6 2,353.3 Fixed maturities, trading 2.4 2.6 Equity securities 1.0 1.1 Mortgage loans 554.9 565.9 Policy loans 425.2 456.8 Other investments 48.4 61.7 Total investments 3,223.5 3,441.4 Cash and cash equivalents 19.7 23.2 Accrued investment income 32.6 35.4 Premiums due and other receivables 8.4 8.3 Deferred tax asset 24.6 24.2 Total assets designated to the Closed Block 3,308.8 3,532.5 Excess of Closed Block liabilities over assets designated to the Closed Block 378.6 392.6 Amounts included in accumulated other comprehensive income 0.6 0.9 Maximum future earnings to be recognized from Closed Block assets and liabilities $ 379.2 $ 393.5 |
Closed Block Revenues and Expenses (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Revenues Premiums and other considerations $ 196.1 $ 217.6 $ 227.6 Net investment income 137.6 143.6 154.4 Net realized capital gains (losses) (4.6) 16.0 7.4 Total revenues 329.1 377.2 389.4 Expenses Benefits, claims and settlement expenses 212.0 212.8 204.4 Dividends to policyholders 92.6 117.8 116.3 Operating expenses 2.3 2.7 2.9 Total expenses 306.9 333.3 323.6 Closed Block revenues, net of Closed Block expenses, before income taxes 22.2 43.9 65.8 Income taxes 3.9 8.4 12.9 Closed Block revenues, net of Closed Block expenses and income taxes 18.3 35.5 52.9 Funding adjustments (4.0) (2.2) (3.0) Closed Block revenues, net of Closed Block expenses, income taxes and funding adjustments $ 14.3 $ 33.3 $ 49.9 |
Change in Maximum Future Earnings of the Closed Block (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Beginning of year $ 393.5 $ 426.9 $ 476.8 Effects of implementation of accounting changes (1) — 0.1 — End of year 379.2 393.5 426.9 Change in maximum future earnings $ (14.3) $ (33.3) $ (49.9) (1) Includes the effects of implementation of accounting changes related to credit losses in 2020. |
Deferred Acquisition Costs (Tab
Deferred Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Deferred Acquisition Costs | |
Deferred Acquisition Costs Rollforward (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of year $ 3,409.7 $ 3,521.3 $ 3,693.5 Costs deferred during the year 461.4 457.0 473.5 Amortized to expense during the year (1) (285.4) (388.1) (347.0) Adjustment related to unrealized (gains) losses on available-for-sale securities and derivative instruments 171.8 (180.5) (298.7) Balance at end of year $ 3,757.5 $ 3,409.7 $ 3,521.3 (1) Includes adjustments for revisions to EGPs. |
Insurance Liabilities (Tables)
Insurance Liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Contractholder Funds (Table) | December 31, 2021 2020 (in millions) Liabilities for investment contracts: Liabilities for individual annuities $ 10,652.3 $ 12,864.1 GICs 12,206.0 11,858.0 Funding agreements 11,685.5 9,407.3 Other investment contracts 1,593.5 1,762.4 Total liabilities for investment contracts 36,137.3 35,891.8 Universal life and other reserves 7,460.7 7,345.9 Total contractholder funds $ 43,598.0 $ 43,237.7 |
Liability for Unpaid Claims (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of year $ 2,534.9 $ 2,365.5 $ 2,252.7 Less: reinsurance recoverable 436.9 403.8 404.3 Net balance at beginning of year 2,098.0 1,961.7 1,848.4 Incurred: Current year 1,572.5 1,376.8 1,361.3 Prior years 7.2 26.6 0.8 Total incurred 1,579.7 1,403.4 1,362.1 Payments: Current year 1,025.0 863.8 869.4 Prior years 435.4 403.3 379.4 Total payments 1,460.4 1,267.1 1,248.8 Net balance at end of year 2,217.3 2,098.0 1,961.7 Plus: reinsurance recoverable 442.1 436.9 403.8 Balance at end of year $ 2,659.4 $ 2,534.9 $ 2,365.5 Amounts not included in the rollforward above: Claim adjustment expense liabilities $ 59.5 $ 57.8 $ 57.9 |
Reconciliation of unpaid claims to liability for unpaid claims (Table) | December 31, 2021 Dental, Vision, STD, LTD and Group Life Critical Illness and Waiver Accident Group Life Consolidated (in millions) Net outstanding liabilities for unpaid claims $ 1,219.0 $ 73.1 $ 80.2 $ 1,372.3 Reconciling items: Reinsurance recoverable on unpaid claims 46.5 — — 46.5 Impact of discounting (208.0) — — (208.0) Liability for unpaid claims - short-duration contracts $ 1,057.5 $ 73.1 $ 80.2 1,210.8 Insurance contracts other than short-duration 1,448.6 Liability for unpaid claims $ 2,659.4 |
Claim Duration and Payout (Table) | December 31, 2021 (1) Dental, Vision, STD, LTD and Group Life Critical Illness and Year Waiver Accident Group Life 1 7.9 % 91.8 % 80.3 % 2 24.6 8.0 17.7 3 15.3 4 8.3 5 5.8 6 5.0 7 4.2 8 3.4 9 3.3 10 2.7 (1) Unaudited. |
Discounting (Table) | Dental, Vision, STD, LTD and Group Life Critical Illness and Waiver Accident Group Life ($ in millions) Carrying amount of liabilities for unpaid claims December 31, 2021 $ 1,057.5 $ 73.1 $ 80.2 December 31, 2020 1,047.6 70.4 54.1 Range of discount rates December 31, 2021 2.8 - 7.0 % — - — % — - — % December 31, 2020 2.8 - 7.0 — - — — - — Aggregate amount of discount December 31, 2021 $ 208.0 $ — $ — December 31, 2020 214.5 — — Interest accretion For the year ended: December 31, 2021 $ 33.8 $ — $ — December 31, 2020 33.9 — — December 31, 2019 34.2 — — |
Long-Term Disability/Group Life Waiver | |
Claims Development (Table) | Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2021 2021 ($ in millions) Incurral year 2012 $ 217.9 $ 200.0 $ 191.1 $ 189.5 $ 181.8 $ 174.8 $ 173.3 $ 171.9 $ 173.1 $ 172.2 $ 0.1 6,445 2013 219.3 203.3 188.4 190.7 182.3 179.5 177.1 173.4 174.5 0.1 7,051 2014 242.2 231.4 214.4 218.1 206.2 201.9 202.0 199.3 0.1 7,603 2015 231.0 227.2 217.2 215.3 208.2 210.0 211.8 0.1 7,180 2016 229.8 228.4 219.4 219.5 214.4 218.7 0.1 6,163 2017 238.4 239.7 243.1 245.8 245.2 0.1 6,080 2018 239.4 245.1 239.2 239.8 5.0 5,763 2019 255.2 248.4 240.4 7.5 5,917 2020 252.1 231.0 3.6 5,850 2021 259.7 97.3 3,271 Total net incurred claims $ 2,192.6 Net cumulative paid claims (1) December 31, 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 (in millions) Incurral year 2012 $ 13.8 $ 55.1 $ 80.8 $ 93.7 $ 104.6 $ 112.9 $ 120.0 $ 126.1 $ 131.5 $ 136.3 2013 12.5 55.0 81.4 97.0 106.4 116.4 123.2 129.0 134.9 2014 16.1 66.0 96.3 111.8 122.3 132.4 140.8 147.2 2015 16.9 67.0 98.0 114.6 126.8 137.1 146.5 2016 16.2 70.6 105.6 124.9 136.8 147.2 2017 17.8 76.5 115.0 135.9 151.7 2018 20.1 79.9 115.7 135.7 2019 19.2 79.7 117.5 2020 20.6 78.8 2021 19.8 Total net paid claims 1,215.6 All outstanding liabilities for unpaid claims prior to 2012 net of reinsurance 242.0 Total outstanding liabilities for unpaid claims net of reinsurance $ 1,219.0 (1) 2012-2020 unaudited. |
Dental/Vision/Short-Term Disability/Critical Illness/Accident | |
Claims Development (Table) | Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2020 2021 2021 2021 ($ in millions) Incurral year 2020 $ 679.8 $ 663.7 $ — 3,079,517 2021 826.0 49.2 3,564,753 Total net incurred claims $ 1,489.7 Net cumulative paid claims (1) December 31, 2020 2021 (in millions) Incurral year 2020 $ 609.5 $ 663.2 2021 753.4 Total net paid claims 1,416.6 All outstanding liabilities for unpaid claims prior to 2020 net of reinsurance — Total outstanding liabilities for unpaid claims net of reinsurance $ 73.1 (1) 2020 unaudited. |
Group Life | |
Claims Development (Table) | Incurred Cumulative but not number of reported reported Net incurred claims (1) claims claims December 31, 2020 2021 2021 2021 ($ in millions) Incurral year 2020 $ 270.6 $ 278.2 $ 0.9 6,251 2021 317.6 27.3 6,274 Total net incurred claims $ 595.8 Net cumulative paid claims (1) December 31, 2020 2021 (in millions) Incurral year 2020 $ 219.3 $ 276.5 2021 243.9 Total net paid claims 520.4 All outstanding liabilities for unpaid claims prior to 2020 net of reinsurance 4.8 Total outstanding liabilities for unpaid claims net of reinsurance $ 80.2 (1) 2020 unaudited. |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Debt | |
Short-Term Debt (Table) | December 31, 2021 Financing Short-term debt Obligor/Applicant structure Maturity Capacity outstanding (in millions) PFG, Principal Financial Services, Inc. (“PFS”) and Principal Life as co-borrowers Credit facility November 2023 $ 600.0 $ — PFG, PFS, Principal Life and Principal Financial Services V (UK) Ltd as co-borrowers Credit facility November 2023 200.0 — Unsecured Principal International Chile (1) lines of credit 145.6 79.8 Total $ 945.6 $ 79.8 December 31, 2020 Financing Short-term debt Obligor/Applicant structure Maturity Capacity outstanding (in millions) PFG, PFS and Principal Life as co-borrowers Credit facility November 2023 $ 600.0 $ — PFG, PFS, Principal Life and Principal Financial Services V (UK) Ltd as co-borrowers Credit facility November 2023 200.0 — Unsecured Principal International Chile (1) lines of credit 186.6 84.7 Total $ 986.6 $ 84.7 (1) The unsecured lines of credit can be used for repurchase agreements or other borrowings. Each line has a maturity of less than one year . |
Long-Term Debt (Table) | December 31, 2021 Principal Net unamortized discount, premium and debt issuance costs Carrying amount (in millions) 3.3% notes payable, due 2022 $ 300.0 $ (0.3) $ 299.7 3.125% notes payable, due 2023 300.0 (0.4) 299.6 3.4% notes payable, due 2025 400.0 (1.7) 398.3 3.1% notes payable, due 2026 350.0 (1.9) 348.1 3.7% notes payable, due 2029 500.0 (5.0) 495.0 2.125% notes payable, due 2030 600.0 (4.1) 595.9 6.05% notes payable, due 2036 505.6 (2.3) 503.3 4.625% notes payable, due 2042 300.0 (3.0) 297.0 4.35% notes payable, due 2043 300.0 (3.0) 297.0 4.3% notes payable, due 2046 300.0 (3.1) 296.9 Floating rate notes payable, due 2055 400.0 (4.6) 395.4 Non-recourse mortgages and notes payable 53.7 0.3 54.0 Total long-term debt $ 4,309.3 $ (29.1) $ 4,280.2 December 31, 2020 Principal Net unamortized discount, premium and debt issuance costs Carrying amount (in millions) 3.3% notes payable, due 2022 $ 300.0 $ (0.7) $ 299.3 3.125% notes payable, due 2023 300.0 (0.7) 299.3 3.4% notes payable, due 2025 400.0 (2.2) 397.8 3.1% notes payable, due 2026 350.0 (2.1) 347.9 3.7% notes payable, due 2029 500.0 (5.5) 494.5 2.125% notes payable, due 2030 600.0 (4.6) 595.4 6.05% notes payable, due 2036 505.6 (2.5) 503.1 4.625% notes payable, due 2042 300.0 (3.1) 296.9 4.35% notes payable, due 2043 300.0 (3.1) 296.9 4.3% notes payable, due 2046 300.0 (3.2) 296.8 Floating rate notes payable, due 2055 400.0 (4.7) 395.3 Non-recourse mortgages and notes payable 55.5 0.5 56.0 Total long-term debt $ 4,311.1 $ (31.9) $ 4,279.2 |
Future Annual Maturities of Long-Term Debt (Table) | As of December 31, 2021, future annual maturities of long-term debt were as follows (in millions): Year ending December 31: 2022 $ 301.8 2023 324.2 2024 17.5 2025 398.7 2026 354.7 Thereafter 2,883.3 Total future maturities of long-term debt $ 4,280.2 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Income Taxes | |
Income Tax Expense (Benefit) from Continuing Operations (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Current income taxes (benefits): U.S. federal $ 110.3 $ 15.8 $ 31.9 State 19.4 5.0 18.1 Foreign 38.3 55.4 45.6 Tax benefit of operating loss carryforward (1.2) (3.3) (3.0) Total current income taxes 166.8 72.9 92.6 Deferred income taxes (benefits): U.S. federal 154.6 143.6 108.6 State 16.6 11.5 6.9 Foreign (11.8) 37.0 41.1 Total deferred income taxes 159.4 192.1 156.6 Income taxes $ 326.2 $ 265.0 $ 249.2 |
Income Before Income Taxes, Domestic and Foreign (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Domestic $ 1,889.1 $ 1,323.2 $ 1,351.9 Foreign 194.5 370.3 341.4 Total income before income taxes $ 2,083.6 $ 1,693.5 $ 1,693.3 |
Reconciliation Between U.S. Corporate Income Tax Rate and Effective Income Tax Rate from Continuing Operations (Table) | For the year ended December 31, 2021 2020 2019 U.S. corporate income tax rate 21 % 21 % 21 % Dividends received deduction (4) (4) (5) Tax credits (2) (3) (3) Impact of equity method presentation (1) (1) (2) State income taxes 1 1 1 Local country permanent tax adjustments — — 1 Other 1 2 2 Effective income tax rate 16 % 16 % 15 % |
Changes in Unrecognized Tax Benefits (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Balance at beginning of period $ 46.9 $ 61.6 $ 42.1 Additions based on tax positions related to the current year 1.8 1.3 0.1 Additions for tax positions of prior years — 17.4 23.1 Reductions for tax positions related to the current year (3.2) (3.2) (3.2) Reductions for tax positions of prior years — — (0.5) Settlements — (14.5) — Expired statute of limitations — (15.7) — Balance at end of period (1) $ 45.5 $ 46.9 $ 61.6 (1) If recognized, $1.6 million of the above amount of unrecognized tax benefits would reduce our 2021 effective income tax rate. We recognize interest and penalties related to uncertain tax positions in operating expenses within the consolidated statements of operations. |
Components of Net Deferred Income Taxes (Table) | December 31, 2021 2020 (in millions) Deferred income tax assets: Insurance liabilities $ — $ 552.4 Net operating and capital loss carryforwards 68.2 69.2 Tax credit carryforwards — 4.6 Employee benefits 377.9 389.1 Other deferred income tax assets — 62.2 Gross deferred income tax assets 446.1 1,077.5 Valuation allowance (28.0) (18.4) Total deferred income tax assets 418.1 1,059.1 Deferred income tax liabilities: Deferred acquisition costs (582.3) (522.6) Investments, including derivatives (304.2) (402.0) Net unrealized gains on available-for-sale securities (1,118.1) (1,762.1) Real estate (141.6) (158.5) Intangible assets (408.0) (387.5) Insurance liabilities (44.2) — Other deferred income tax liabilities (54.9) (43.4) Total deferred income tax liabilities (2,653.3) (3,276.1) Total net deferred income tax liabilities $ (2,235.2) $ (2,217.0) |
Net Deferred Income Taxes by Jurisdiction (Table) | December 31, 2021 2020 (in millions) Deferred income tax assets: State $ 61.2 $ 81.1 Foreign 23.8 32.7 Net deferred income tax assets 85.0 113.8 Deferred income tax liabilities: U.S. federal (2,023.6) (2,011.8) Foreign (296.6) (319.0) Net deferred income tax liabilities (2,320.2) (2,330.8) Total net deferred income tax liabilities $ (2,235.2) $ (2,217.0) |
Employee and Agent Benefits (Ta
Employee and Agent Benefits (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Defined Benefit Plans and Other Postretirement Benefit Plans | |
Components of Net Periodic Benefit Cost (Income) (Table) | Pension benefits Other postretirement benefits For the year ended December 31, 2021 2020 2019 2021 2020 2019 (in millions) Service cost $ 83.2 $ 72.7 $ 66.0 $ — $ — $ — Interest cost 103.3 117.3 126.5 2.2 2.8 3.7 Expected return on plan assets (182.7) (156.8) (148.8) (4.8) (36.0) (33.2) Amortization of prior service benefit (16.8) (16.8) (11.3) (1.1) (1.0) (1.2) Recognized net actuarial (gain) loss 70.2 75.4 70.1 (0.5) — 0.1 Net periodic benefit cost (income) $ 57.2 $ 91.8 $ 102.5 $ (4.2) $ (34.2) $ (30.6) |
Obligations and Funded Status (Table) | Other postretirement Pension benefits benefits December 31, December 31, 2021 2020 2021 2020 (in millions) Change in benefit obligation Benefit obligation at beginning of year $ (4,210.2) $ (3,692.1) $ (108.0) $ (101.4) Service cost (83.2) (72.7) — — Interest cost (103.3) (117.3) (2.2) (2.8) Actuarial gain (loss) 75.8 (462.4) 7.6 (11.7) Participant contributions — — (6.1) (6.0) Benefits paid 137.2 134.3 13.5 12.8 Plan amendments — — — 1.0 Other — — (0.1) 0.1 Benefit obligation at end of year $ (4,183.7) $ (4,210.2) $ (95.3) $ (108.0) Change in plan assets Fair value of plan assets at beginning of year $ 3,373.5 $ 2,926.0 $ 780.6 $ 732.8 Actual return on plan assets 208.7 521.3 1.6 53.1 Employer contribution 105.1 60.5 1.5 1.5 Participant contributions — — 6.1 6.0 Benefits paid (137.2) (134.3) (13.5) (12.8) Assets re-designated for non-retiree benefits — — (656.5) — Fair value of plan assets at end of year $ 3,550.1 $ 3,373.5 $ 119.8 $ 780.6 Amount recognized in statement of financial position Other assets $ — $ — $ 24.5 $ 675.5 Other liabilities (633.6) (836.7) — (2.9) Total $ (633.6) $ (836.7) $ 24.5 $ 672.6 Amount recognized in accumulated other comprehensive (income) loss Total net actuarial (gain) loss $ 588.0 $ 760.0 $ (26.7) $ (22.8) Prior service benefit (104.2) (121.0) (6.2) (7.3) Pre-tax accumulated other comprehensive (income) loss $ 483.8 $ 639.0 $ (32.9) $ (30.1) |
Amounts Recognized in Net Periodic Benefit Cost and Accumulated Other Comprehensive (Income) Loss (Table) | Pension benefits Other postretirement benefits For the year ended December 31, 2021 2020 2021 2020 (in millions) Other changes recognized in accumulated other comprehensive (income) loss Net actuarial (gain) loss $ (101.8) $ 97.9 $ (4.4) $ (5.4) Prior service benefit — — — (1.0) Amortization of gain (loss) (70.2) (75.4) 0.5 — Amortization of prior service benefit 16.8 16.8 1.1 1.0 Total recognized in pre-tax accumulated other comprehensive (income) loss $ (155.2) $ 39.3 $ (2.8) $ (5.4) Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss $ (98.0) $ 131.1 $ (7.0) $ (39.6) |
Weighted-Average Assumptions Used to Determine Benefit Obligations (Table) | Pension benefits For the year ended December 31, 2021 2020 Discount rate 2.75 % 2.50 % Interest crediting rate - cash balance benefit 5.00 % 5.00 % Rate of compensation increase 4.59 % 4.41 % Other postretirement benefits For the year ended December 31, 2021 2020 Discount rate 2.50 % 2.10 % Rate of compensation increase N/A N/A |
Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost (Table) | Pension benefits For the year ended December 31, 2021 2020 2019 Discount rate (1) 2.50 % 3.25 % 3.70 % Expected long-term return on plan assets 5.55 % 5.60 % 5.95 % Interest crediting rate - cash balance benefit 5.00 % 5.00 % — % Rate of compensation increase: Cash balance benefit 4.92 % 4.95 % 4.94 % Traditional benefit 2.96 % 2.98 % 2.73 % Other postretirement benefits For the year ended December 31, 2021 2020 2019 Discount rate (2) 2.10 % 2.95 % 3.95 % Expected long-term return on plan assets 4.25 % 4.94 % 5.19 % Rate of compensation increase N/A N/A N/A (1) During the second quarter of 2019, we amended The Principal Pension Plan and The Principal Financial Group Nonqualified Defined Benefit Plan for Employees to end traditional benefit accruals as of December 31, 2022, and begin cash balance accruals January 1, 2023. We remeasured the associated plan assets and pension benefit obligations as of May 31, 2019. A discount rate of 4.15% was used until the remeasurement date at which time a discount rate of 3.70% was used. (2) During the second quarter 2020, subsidy increases provided under the long-term care plan were capped at 5% per calendar year. This change was remeasured as of March 31, 2020. A discount rate of 2.95% was used until the remeasurement date at which time a discount rate of 2.90% was used. |
Assumed Health Care Cost Trend Rates (Table) | December 31, 2021 2020 Health care cost trend rate assumed for next year under age 65 7.00 % 6.75 % Health care cost trend rate assumed for next year age 65 and over 6.50 % 6.00 % Rate to which the cost trend rate is assumed to decline (the ultimate trend rate) 4.50 % 4.50 % Year that the rate reaches the ultimate trend rate (under age 65) 2030 2029 Year that the rate reaches the ultimate trend rate (65 and older) 2029 2026 |
Estimated Future Benefit Payments (Table) | Other postretirement benefits (gross benefit payments, including Pension benefits prescription drug benefits) (in millions) Year ending December 31: 2022 $ 173.6 $ 14.5 2023 166.4 13.3 2024 178.6 12.2 2025 182.0 11.0 2026 192.5 9.7 2027-2031 1,087.3 35.9 |
Defined Benefit Pension Plans Supplemental Information (Table) | For the year ended December 31, 2021 2020 Qualified Nonqualified Qualified Nonqualified Plan Plan Total Plan Plan Total (in millions) Amount recognized in statement of financial position Other assets $ — $ — $ — $ — $ — $ — Other liabilities (108.4) (525.2) (633.6) (294.9) (541.8) (836.7) Total $ (108.4) $ (525.2) $ (633.6) $ (294.9) $ (541.8) $ (836.7) Amount recognized in accumulated other comprehensive loss Total net actuarial loss $ 415.5 $ 172.5 $ 588.0 $ 563.5 $ 196.5 $ 760.0 Prior service benefit (85.2) (19.0) (104.2) (97.8) (23.2) (121.0) Pre-tax accumulated other comprehensive loss $ 330.3 $ 153.5 $ 483.8 $ 465.7 $ 173.3 $ 639.0 Components of net periodic benefit cost Service cost $ 76.2 $ 7.0 $ 83.2 $ 66.1 $ 6.6 $ 72.7 Interest cost 90.1 13.2 103.3 101.2 16.1 117.3 Expected return on plan assets (182.7) — (182.7) (156.8) — (156.8) Amortization of prior service benefit (12.6) (4.2) (16.8) (12.6) (4.2) (16.8) Recognized net actuarial loss 52.8 17.4 70.2 59.9 15.5 75.4 Net periodic benefit cost $ 23.8 $ 33.4 $ 57.2 $ 57.8 $ 34.0 $ 91.8 Other changes recognized in accumulated other comprehensive (income) loss Net actuarial (gain) loss $ (95.3) $ (6.5) $ (101.8) $ 55.7 $ 42.2 $ 97.9 Amortization of net loss (52.8) (17.4) (70.2) (59.8) (15.6) (75.4) Amortization of prior service benefit 12.6 4.2 16.8 12.6 4.2 16.8 Total recognized in pre-tax accumulated other comprehensive (income) loss $ (135.5) $ (19.7) $ (155.2) $ 8.5 $ 30.8 $ 39.3 Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss $ (111.7) $ 13.7 $ (98.0) $ 66.3 $ 64.8 $ 131.1 |
Pension benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans | |
Accumulated Benefit Obligation in Excess of Plan Assets (Table) | December 31, 2021 2020 (in millions) Projected benefit obligation $ 4,183.7 $ 4,210.2 Accumulated benefit obligation 4,149.3 4,136.5 Fair value of plan assets 3,550.1 3,373.5 |
Fair Value of Plan Assets (Table) | December 31, 2021 Assets Amount Fair value hierarchy level measured at measured at fair value net asset value Level 1 Level 2 Level 3 (in millions) Asset category Pooled separate account investments: U.S. large cap equity portfolios (1) $ 422.5 $ — $ — $ 422.5 $ — U.S. small/mid cap equity portfolios (2) 65.9 — — 65.9 — Balanced asset portfolios (3) 119.0 — — 119.0 — International equity portfolios (4) 252.5 — — 252.5 — Real estate investment portfolios (5) 239.6 — — 239.6 — Single client separate account investments: Fixed income securities: U.S. government and agencies 451.2 — 451.2 — — States and political subdivisions 31.2 — — 31.2 — Corporate 1,678.1 — — 1,678.1 — Commercial mortgage-backed securities 18.2 — — 18.2 — Other debt obligations 9.2 — — 9.2 — Hedge funds (6) 175.7 175.7 — — — Pooled separate account investment (7) 79.3 — — 79.3 — Other (8) 7.7 — — 7.7 — Total $ 3,550.1 $ 175.7 $ 451.2 $ 2,923.2 $ — December 31, 2020 Assets Amount Fair value hierarchy level measured at measured at fair value net asset value Level 1 Level 2 Level 3 (in millions) Asset category Pooled separate account investments: U.S. large cap equity portfolios (1) $ 712.2 $ — $ — $ 712.2 $ — U.S. small/mid cap equity portfolios (2) 121.6 — — 121.6 — Balanced asset portfolios (3) 103.7 — — 103.7 — International equity portfolios (4) 459.6 — — 459.6 — Real estate investment portfolios (5) 195.1 — — 195.1 — Single client separate account investments: Fixed income securities: U.S. government and agencies 297.5 — 297.5 — — States and political subdivisions 28.0 — — 28.0 — Corporate 1,223.1 — — 1,223.1 — Commercial mortgage-backed securities 13.6 — — 13.6 — Other debt obligations 6.4 — — 6.4 — Hedge funds (6) 155.8 155.8 — — — Pooled separate account investment (7) 55.1 — — 55.1 — Other (8) 1.8 — — 1.8 — Total $ 3,373.5 $ 155.8 $ 297.5 $ 2,920.2 $ — (1) The portfolios invest primarily in publicly traded equity securities of large U.S. companies. (2) The portfolios invest primarily in publicly traded equity securities of mid-sized and small U.S. companies. (3) The portfolios are a combination of underlying fixed income and equity investment options. These investment options may include balanced, asset allocation, target-date and target-risk investment options. Although typically lower risk than investment options that invest solely in equities, all investment options in this category have the potential to lose value. (4) The portfolios invest primarily in publicly traded equity securities of non-U.S. companies. (5) The portfolio invests primarily in U.S. commercial real estate properties through a separate account. (6) The hedge funds have varying investment strategies that also have a variety of redemption terms and conditions. We do not have unfunded commitments associated with these hedge funds. (7) The single client separate accounts invest in a money market pooled separate account. (8) Includes cash and net (payables)/receivables for the single client separate accounts. |
Target Asset Allocation (Table) | Asset category Target allocation Fixed income security portfolios 25 % - 80 % Equity portfolios 5 % - 60 % Real estate investment portfolios 10 % Alternatives 0 % - 5 % |
Other postretirement benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans | |
Accumulated Benefit Obligation in Excess of Plan Assets (Table) | December 31, 2021 2020 (in millions) Accumulated postretirement benefit obligation $ — $ 2.9 Fair value of plan assets — — |
Fair Value of Plan Assets (Table) | December 31, 2021 Assets Fair value hierarchy level measured at fair value Level 1 Level 2 Level 3 (in millions) Asset category Cash and cash equivalents $ 0.6 $ 0.6 $ — $ — Fixed income security portfolios (1) 57.7 57.7 — — U.S. equity portfolios (2) 42.8 42.8 — — International equity portfolios (3) 18.7 18.7 — — Total $ 119.8 $ 119.8 $ — $ — December 31, 2020 Assets Fair value hierarchy level measured at fair value Level 1 Level 2 Level 3 (in millions) Asset category Cash and cash equivalents $ 0.5 $ 0.5 $ — $ — Fixed income security portfolios (1) 625.2 605.9 19.3 — U.S. equity portfolios (2) 103.5 38.2 65.3 — International equity portfolios (3) 51.4 18.4 33.0 — Total $ 780.6 $ 663.0 $ 117.6 $ — (1) The portfolios invest in various fixed income securities, primarily of U.S. origin. These include, but are not limited to, corporate bonds, residential mortgage-backed securities, commercial mortgage-backed securities, U.S. Treasury securities, agency securities, asset-backed securities and collateralized mortgage obligations. (2) The portfolios invest primarily in publicly traded equity securities of large U.S. companies. (3) The portfolios invest primarily in publicly traded equity securities of non-U.S. companies. |
Target Asset Allocation (Table) | Asset category Target allocation Fixed income security portfolios 50 % U.S. equity portfolios 35 % International equity portfolios 15 % |
Contingencies, Guarantees, In_2
Contingencies, Guarantees, Indemnifications and Leases (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Contingencies, Guarantees, Indemnifications and Leases | |
Lease Assets and Liabilities (Table) | December 31, 2021 2020 (in millions) Assets Operating lease assets (1) $ 210.5 $ 234.9 Finance lease assets (1) 94.2 49.5 Total lease assets $ 304.7 $ 284.4 Liabilities Operating lease liabilities (2) $ 209.9 $ 231.4 Finance lease liabilities (2) 94.8 50.1 Total lease liabilities $ 304.7 $ 281.5 (1) Operating and finance lease assets are primarily reported within property and equipment on the consolidated statements of financial position. (2) Operating and finance lease liabilities are reported within other liabilities on the consolidated statements of financial position. |
Lease Cost (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Finance lease cost (1): Amortization of right-of-use assets $ 30.5 $ 20.5 $ 14.6 Interest on lease liabilities 1.0 1.0 1.0 Operating lease cost (1) 66.6 58.7 55.8 Other lease cost (1) (2) 10.8 8.6 8.0 Sublease income (3) (1.7) (1.6) (1.7) Total lease cost $ 107.2 $ 87.2 $ 77.7 (1) Finance, operating and other lease costs are primarily included in operating expenses on the consolidated statements of operations. (2) Other lease cost primarily reflects variable and short-term lease costs. (3) Sublease income is included in fees and other revenues on the consolidated statements of operations. |
Future Payments Due by Period for Lease Obligations (Table) | Operating leases Finance leases Total (in millions) For the twelve months ending December 31: 2022 $ 55.6 $ 32.8 $ 88.4 2023 46.5 31.4 77.9 2024 34.3 23.7 58.0 2025 27.9 7.9 35.8 2026 22.7 0.5 23.2 2027 and thereafter 47.2 — 47.2 Total lease payments 234.2 96.3 330.5 Less: interest 24.3 1.5 25.8 Present value of lease liabilities $ 209.9 $ 94.8 $ 304.7 |
Weighted-Average Remaining Lease Term and Weighted-Average Discount Rates (Table) | For the year ended December 31, 2021 2020 2019 Weighted-average remaining lease term (in years): Operating leases 6.5 6.7 6.7 Finance leases 3.2 3.0 2.6 Weighted-average discount rate: Operating leases 3.4 % 3.2 % 3.9 % Finance leases 1.0 % 1.8 % 2.7 % |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stockholders' Equity | |
Common Stock Dividends (Table) | For the year ended December 31, 2021 2020 2019 Dividends declared per common share $ 2.44 $ 2.24 $ 2.18 |
Reconciliation of Outstanding Common Shares (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Beginning balance 273.3 276.6 279.5 Shares issued 3.0 2.6 2.6 Treasury stock acquired (14.6) (5.9) (5.5) Ending balance 261.7 273.3 276.6 |
Other Comprehensive Income (Loss) (Table) | For the year ended December 31, 2021 Pre-Tax Tax After-Tax (in millions) Net unrealized losses on available-for-sale securities during the period $ (2,960.0) $ 665.4 $ (2,294.6) Reclassification adjustment for losses included in net income (1) 19.4 (5.1) 14.3 Adjustments for assumed changes in amortization patterns 171.4 (36.0) 135.4 Adjustments for assumed changes in policyholder liabilities 1,913.1 (439.1) 1,474.0 Net unrealized losses on available-for-sale securities (856.1) 185.2 (670.9) Net unrealized gains on derivative instruments during the period 66.7 (14.0) 52.7 Reclassification adjustment for gains included in net income (3) (25.5) 5.4 (20.1) Adjustments for assumed changes in amortization patterns (0.2) — (0.2) Adjustments for assumed changes in policyholder liabilities 1.6 (0.4) 1.2 Net unrealized gains on derivative instruments 42.6 (9.0) 33.6 Foreign currency translation adjustment during the period (267.9) (5.6) (273.5) Reclassification adjustment for losses included in net income (4) 19.3 — 19.3 Foreign currency translation adjustment (248.6) (5.6) (254.2) Unrecognized postretirement benefit obligation during the period 106.5 (28.5) 78.0 Amortization of amounts included in net periodic benefit cost (5) 51.8 (14.0) 37.8 Net unrecognized postretirement benefit obligation 158.3 (42.5) 115.8 Other comprehensive loss $ (903.8) $ 128.1 $ (775.7) For the year ended December 31, 2020 Pre-Tax Tax After-Tax (in millions) Net unrealized gains on available-for-sale securities during the period $ 3,441.4 $ (728.7) $ 2,712.7 Reclassification adjustment for gains included in net income (1) (52.9) 12.6 (40.3) Adjustments for assumed changes in amortization patterns (179.0) 37.6 (141.4) Adjustments for assumed changes in policyholder liabilities (1,478.2) 323.7 (1,154.5) Net unrealized gains on available-for-sale securities 1,731.3 (354.8) 1,376.5 Net unrealized losses on derivative instruments during the period (28.1) 6.5 (21.6) Reclassification adjustment for gains included in net income (3) (27.1) 5.1 (22.0) Adjustments for assumed changes in amortization patterns 2.7 (0.5) 2.2 Adjustments for assumed changes in policyholder liabilities 7.8 (1.6) 6.2 Net unrealized losses on derivative instruments (44.7) 9.5 (35.2) Foreign currency translation adjustment during the period (11.7) (2.6) (14.3) Reclassification adjustment for losses included in net income (4) 43.0 1.9 44.9 Foreign currency translation adjustment 31.3 (0.7) 30.6 Unrecognized postretirement benefit obligation during the period (91.9) 24.9 (67.0) Amortization of amounts included in net periodic benefit cost (5) 57.6 (15.5) 42.1 Net unrecognized postretirement benefit obligation (34.3) 9.4 (24.9) Other comprehensive income $ 1,683.6 $ (336.6) $ 1,347.0 For the year ended December 31, 2019 Pre-Tax Tax After-Tax (in millions) Net unrealized gains on available-for-sale securities during the period $ 4,414.1 $ (947.0) $ 3,467.1 Reclassification adjustment for losses included in net income (1) 47.4 (9.7) 37.7 Adjustments for assumed changes in amortization patterns (293.0) 61.5 (231.5) Adjustments for assumed changes in policyholder liabilities (847.7) 190.5 (657.2) Net unrealized gains on available-for-sale securities 3,320.8 (704.7) 2,616.1 Noncredit component of impairment losses on fixed maturities, available-for-sale during the period 5.2 (1.1) 4.1 Adjustments for assumed changes in amortization patterns (1.4) 0.3 (1.1) Noncredit component of impairment losses on fixed maturities, available-for-sale (2) 3.8 (0.8) 3.0 Net unrealized losses on derivative instruments during the period (0.5) — (0.5) Reclassification adjustment for gains included in net income (3) (23.9) 4.9 (19.0) Adjustments for assumed changes in amortization patterns 3.1 (0.6) 2.5 Adjustments for assumed changes in policyholder liabilities 7.9 (1.9) 6.0 Net unrealized losses on derivative instruments (13.4) 2.4 (11.0) Foreign currency translation adjustment during the period (112.3) 7.5 (104.8) Reclassification adjustment for losses included in net income (4) 26.1 — 26.1 Foreign currency translation adjustment (86.2) 7.5 (78.7) Unrecognized postretirement benefit obligation during the period 43.6 (8.6) 35.0 Amortization of amounts included in net periodic benefit cost (5) 57.7 (15.4) 42.3 Net unrecognized postretirement benefit obligation 101.3 (24.0) 77.3 Other comprehensive income $ 3,326.3 $ (719.6) $ 2,606.7 (1) Pre-tax reclassification adjustments relating to available-for-sale securities are reported in net realized capital gains (losses) on the consolidated statements of operations. (2) Prior to 2020, represents the net impact of (1) unrealized gains resulting from reclassification of previously recognized noncredit impairment losses from OCI to net realized capital gains (losses) for fixed maturities with bifurcated OTTI that had additional credit losses or fixed maturities that previously had bifurcated OTTI that have now been sold or are intended to be sold and (2) unrealized losses resulting from reclassification of noncredit impairment losses for fixed maturities with bifurcated OTTI from net realized capital gains (losses) to OCI. (3) See Note 5, Derivative Financial Instruments, under the caption “Effect of Fair Value and Cash Flow Hedges on Consolidated Statements of Operations” for further details. (4) The 2021 pre-tax reclassification adjustment related to the release of cumulative translation adjustment from the dissolution of foreign subsidiaries. The 2020 pre-tax reclassification adjustment primarily related to the release of the cumulative translation adjustment from the dissolution of a foreign subsidiary and the net impact of deconsolidated sponsored investment funds and associated net investment hedges. The 2019 pre-tax reclassification adjustment primarily related to deconsolidated sponsored investment funds. The adjustments were reported in net realized capital gains (losses) on the consolidated statements of operations. For the years ended December 31, 2020 and 2019, $8.7 million and $5.7 million, respectively, of this reclassification relates to noncontrolling interest and is reported in net income attributable to noncontrolling interest on the consolidated statements of operations. (5) Amount is comprised of amortization of prior service cost (benefit) and recognized net actuarial (gain) loss, which is reported in operating expenses on the consolidated statements of operations. See Note 11, Employee and Agent Benefits, under the caption “Components of Net Periodic Benefit Cost” for further details. |
Accumulated Other Comprehensive Income (Loss) (Table) | Noncredit Net unrealized component of Net unrealized Foreign Unrecognized Accumulated gains on impairment losses gains currency postretirement other available-for-sale on fixed maturities on derivative translation benefit comprehensive securities (1) available-for-sale (2) instruments adjustment obligation income (in millions) Balances as of January 1, 2019 $ 190.0 $ (47.1) $ 64.4 $ (1,259.5) $ (512.9) $ (1,565.1) Other comprehensive income during the period, net of adjustments 2,578.3 — 8.0 (102.7) 35.0 2,518.6 Amounts reclassified from AOCI 37.7 3.0 (19.0) 20.4 42.3 84.4 Other comprehensive income 2,616.0 3.0 (11.0) (82.3) 77.3 2,603.0 Balances as of December 31, 2019 2,806.0 (44.1) 53.4 (1,341.8) (435.6) 1,037.9 Other comprehensive income during the period, net of adjustments 1,416.7 — (13.2) (7.3) (67.0) 1,329.2 Amounts reclassified from AOCI (40.3) — (22.0) 36.2 42.1 16.0 Other comprehensive income 1,376.4 — (35.2) 28.9 (24.9) 1,345.2 Effects of implementation of accounting change related to credit losses, net (44.1) 44.1 — — — — Balances as of December 31, 2020 4,138.3 — 18.2 (1,312.9) (460.5) 2,383.1 Other comprehensive loss during the period, net of adjustments (685.2) — 53.7 (270.0) 78.0 (823.5) Amounts reclassified from AOCI 14.3 — (20.1) 19.3 37.8 51.3 Other comprehensive loss (670.9) — 33.6 (250.7) 115.8 (772.2) Balances as of December 31, 2021 $ 3,467.4 $ — $ 51.8 $ (1,563.6) $ (344.7) $ 1,610.9 (1) Net unrealized losses on available-for-sale debt securities for which an allowance for credit loss has been recorded were $2.1 million and $2.9 million as of December 31, 2021 and 2020, respectively. (2) Prior to the implementation of authoritative guidance in 2020, the noncredit component of impairment losses on fixed maturities, available-for-sale was included as a separate component of stockholders’ equity. |
Redeemable Noncontrolling Interest (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Beginning balance $ 255.6 $ 264.9 $ 391.2 Net income attributable to redeemable noncontrolling interest 17.5 7.5 33.6 Redeemable noncontrolling interest of deconsolidated entities (1) (37.4) (91.9) (505.4) Contributions from redeemable noncontrolling interest 166.8 136.2 402.1 Distributions to redeemable noncontrolling interest (66.8) (62.0) (66.3) Purchase of subsidiary shares from redeemable noncontrolling interest (6.1) — (1.1) Change in redemption value of redeemable noncontrolling interest 3.1 0.2 5.4 Stock-based compensation attributable to redeemable noncontrolling interest — 0.1 0.1 Other comprehensive income (loss) attributable to redeemable noncontrolling interest (0.2) 0.6 5.3 Ending balance $ 332.5 $ 255.6 $ 264.9 (1) We deconsolidated certain sponsored investment funds as they no longer met the requirements for consolidation. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Fair Value Measurements | |
Fair Value (Table) | December 31, 2021 Assets/ Amount (liabilities) measured at Fair value hierarchy level measured at net asset fair value value (4) Level 1 Level 2 Level 3 (in millions) Assets Fixed maturities, available-for-sale: U.S. government and agencies $ 2,088.6 $ — $ 1,716.5 $ 372.1 $ — Non-U.S. governments 982.0 — 0.6 981.4 — States and political subdivisions 9,304.4 — — 9,209.6 94.8 Corporate 45,944.4 — 41.5 45,068.6 834.3 Residential mortgage-backed pass-through securities 3,152.9 — — 3,152.9 — Commercial mortgage-backed securities 5,562.2 — — 5,543.0 19.2 Collateralized debt obligations (1) 3,559.6 — — 3,473.8 85.8 Other debt obligations 7,560.4 — — 7,518.3 42.1 Total fixed maturities, available-for-sale 78,154.5 — 1,758.6 75,319.7 1,076.2 Fixed maturities, trading 422.2 — 0.5 416.8 4.9 Equity securities 2,347.2 — 1,027.5 1,319.7 — Derivative assets (2) 337.1 — — 336.5 0.6 Other investments 896.2 92.7 395.3 406.1 2.1 Cash equivalents 1,117.8 — 14.2 1,103.6 — Sub-total excluding separate account assets 83,275.0 92.7 3,196.1 78,902.4 1,083.8 Separate account assets 182,345.4 8,942.9 115,261.7 57,195.5 945.3 Total assets $ 265,620.4 $ 9,035.6 $ 118,457.8 $ 136,097.9 $ 2,029.1 Liabilities Investment and universal life contracts (3) $ (356.3) $ — $ — $ — $ (356.3) Derivative liabilities (2) (226.0) — — (225.4) (0.6) Other liabilities (0.7) — — (0.7) — Total liabilities $ (583.0) $ — $ — $ (226.1) $ (356.9) Net assets $ 265,037.4 $ 9,035.6 $ 118,457.8 $ 135,871.8 $ 1,672.2 December 31, 2020 Assets/ Amount (liabilities) measured at Fair value hierarchy level measured at net asset fair value value (4) Level 1 Level 2 Level 3 (in millions) Assets Fixed maturities, available-for-sale: U.S. government and agencies $ 2,111.5 $ — $ 1,768.3 $ 343.2 $ — Non-U.S. governments 1,073.7 — 1.1 1,072.6 — States and political subdivisions 9,167.8 — — 9,167.8 — Corporate 47,354.8 — — 47,064.0 290.8 Residential mortgage-backed pass-through securities 2,986.8 — — 2,986.8 — Commercial mortgage-backed securities 4,942.3 — — 4,929.1 13.2 Collateralized debt obligations (1) 4,027.5 — — 4,000.3 27.2 Other debt obligations 7,045.9 — — 7,016.7 29.2 Total fixed maturities, available-for-sale 78,710.3 — 1,769.4 76,580.5 360.4 Fixed maturities, trading 532.1 — 0.5 531.6 — Equity securities 2,013.4 — 659.7 1,353.7 — Derivative assets (2) 463.5 — — 462.9 0.6 Other investments 746.3 75.7 252.8 385.9 31.9 Cash equivalents 1,466.4 — 38.3 1,428.1 — Sub-total excluding separate account assets 83,932.0 75.7 2,720.7 80,742.7 392.9 Separate account assets 175,951.4 155.8 102,550.5 64,351.9 8,893.2 Total assets $ 259,883.4 $ 231.5 $ 105,271.2 $ 145,094.6 $ 9,286.1 Liabilities Investment and universal life contracts (3) $ (467.8) $ — $ — $ — $ (467.8) Derivative liabilities (2) (186.1) — — (180.4) (5.7) Other liabilities (0.4) — — (0.4) — Total liabilities $ (654.3) $ — $ — $ (180.8) $ (473.5) Net assets $ 259,229.1 $ 231.5 $ 105,271.2 $ 144,913.8 $ 8,812.6 (1) Primarily consists of collateralized loan obligations backed by secured corporate loans. (2) Within the consolidated statements of financial position, derivative assets are reported with other investments and derivative liabilities are reported with other liabilities. The amounts are presented gross in the tables above to reflect the presentation on the consolidated statements of financial position; however, are presented net for purposes of the rollforward in the Changes in Level 3 Fair Value Measurements tables. Refer to Note 5, Derivative Financial Instruments, for further information on fair value by class of derivative instruments. (3) Includes bifurcated embedded derivatives that are reported at net asset (liability) fair value within the same line item in the consolidated statements of financial position in which the host contract is reported. (4) Certain investments are measured at fair value using the NAV per share (or its equivalent) practical expedient and have not been classified in the fair value hierarchy. Other investments using the NAV practical expedient consist of certain fund interests that are restricted until maturity with unfunded commitments totaling $10.2 million and $15.1 million as of December 31, 2021 and December 31, 2020, respectively. Separate account assets using the NAV practical expedient consist of hedge funds and a real estate fund with varying investment strategies that also have a variety of redemption terms and conditions. We do not have unfunded commitments associated with these funds. |
Reconciliation for All Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Table) | For the year ended December 31, 2021 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2021 (2) income (3) (4) Level 3 Level 3 2021 (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ — $ — $ 12.8 $ (0.4) $ 82.4 $ — $ 94.8 Corporate 290.8 (21.9) 7.8 381.8 175.8 — 834.3 Commercial mortgage-backed securities 13.2 (1.0) (0.4) 7.4 — — 19.2 Collateralized debt obligations 27.2 (2.0) 1.6 420.7 74.1 (435.8) 85.8 Other debt obligations 29.2 — 0.4 16.9 20.6 (25.0) 42.1 Total fixed maturities, available-for-sale 360.4 (24.9) 22.2 826.4 352.9 (460.8) 1,076.2 Fixed maturities, trading — — — 4.9 — — 4.9 Other investments 31.9 12.5 (1.3) (41.0) — — 2.1 Separate account assets (1) 8,893.2 313.1 — (8,261.0) — — 945.3 Liabilities Investment and universal life contracts (467.8) 81.7 0.2 29.6 — — (356.3) Derivatives Net derivative assets (liabilities) (5.1) (6.9) — 12.0 — — — For the year ended December 31, 2020 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2020 (2) income (3) (4) Level 3 Level 3 2020 (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 81.7 $ (0.9) $ 5.2 $ 118.0 $ 342.0 $ (255.2) $ 290.8 Commercial mortgage-backed securities 12.9 (1.3) 1.4 (0.1) 0.3 — 13.2 Collateralized debt obligations 199.0 (2.3) (21.9) 183.0 — (330.6) 27.2 Other debt obligations 91.3 — (1.4) (37.9) 46.1 (68.9) 29.2 Total fixed maturities, available-for-sale 384.9 (4.5) (16.7) 263.0 388.4 (654.7) 360.4 Fixed maturities, trading 0.3 — — — — (0.3) — Other investments 39.0 6.3 (2.9) (10.5) — — 31.9 Separate account assets (1) 8,968.0 463.7 — (538.5) — — 8,893.2 Liabilities Investment and universal life contracts (214.2) (254.9) (0.3) 1.6 — — (467.8) Derivatives Net derivative assets (liabilities) 13.0 11.8 — (3.4) — (26.5) (5.1) For the year ended December 31, 2019 Beginning Net Ending asset/ Total realized/unrealized purchases, asset/ (liability) gains (losses) sales, (liability) balance Included Included in issuances balance as of in net other and Transfers Transfers as of January 1, income comprehensive settlements into out of December 31, 2019 (2) income (3) (4) Level 3 Level 3 2019 (in millions) Assets Fixed maturities, available-for-sale: Non-U.S. governments $ 4.6 $ — $ — $ (4.6) $ — $ — $ — Corporate 57.9 — 2.5 17.2 4.1 — 81.7 Commercial mortgage-backed securities 9.5 (3.8) 3.4 2.4 3.7 (2.3) 12.9 Collateralized debt obligations 8.3 (2.6) 0.9 122.5 69.9 — 199.0 Other debt obligations 58.5 — 0.8 100.0 8.3 (76.3) 91.3 Total fixed maturities, available-for-sale 138.8 (6.4) 7.6 237.5 86.0 (78.6) 384.9 Fixed maturities, trading — — — 0.3 — — 0.3 Other investments 17.2 6.0 — 5.8 10.0 — 39.0 Separate account assets (1) 8,615.5 739.9 — (214.2) — (173.2) 8,968.0 Liabilities Investment and universal life contracts (45.2) (145.5) (0.2) (23.3) — — (214.2) Derivatives Net derivative assets (liabilities) 3.1 (0.8) — 10.7 — — 13.0 (1) Gains and losses for separate account assets do not impact net income as the change in value of separate account assets is offset by a change in value of separate account liabilities. Foreign currency translation adjustments related to the Principal International segment separate account assets are recorded in AOCI and are offset by foreign currency translation adjustments of the corresponding separate account liabilities. (2) Both realized gains (losses) and mark-to-market unrealized gains (losses) are generally reported in net realized capital gains (losses) within the consolidated statements of operations. Realized and unrealized gains (losses) on certain securities with an investment objective to realize economic value through mark-to-market changes are reported in net investment income within the consolidated statements of operations. Changes in unrealized gains (losses) included in net income relating to positions still held were : For the year ended December 31, 2021 2020 2019 (in millions) Assets Fixed maturities, available-for-sale: Corporate $ (4.6) $ — $ — Commercial mortgage-backed securities (1.0) (1.2) (2.9) Collateralized debt obligations (2.0) (2.2) (2.6) Total fixed maturities, available-for-sale (7.6) (3.4) (5.5) Other investments 12.5 5.3 6.0 Separate account assets 90.5 385.5 697.1 Liabilities Investment and universal life contracts 80.3 (262.1) (146.0) Derivatives Net derivative assets (liabilities) (0.6) 9.9 5.3 (3) Changes in unrealized gains (losses) included in OCI, including foreign currency translation adjustments related to our Principal International segment, relating to positions still held were : For the year ended December 31, 2021 2020 (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ 12.8 $ — Corporate (0.7) 11.9 Commercial mortgage-backed securities (0.4) 1.5 Collateralized debt obligations 1.9 (0.3) Total fixed maturities, available-for-sale 13.6 13.1 Other investments (1.3) (2.9) Liabilities Investment and universal life contracts 0.2 (0.3) (4) Gross purchases, sales, issuances and settlements were: For the year ended December 31, 2021 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: States and political subdivisions $ — $ — $ — $ (0.4) $ (0.4) Corporate 626.6 (84.3) — (160.5) 381.8 Commercial mortgage-backed securities 7.7 — — (0.3) 7.4 Collateralized debt obligations 446.0 — — (25.3) 420.7 Other debt obligations 45.1 — — (28.2) 16.9 Total fixed maturities, available-for-sale 1,125.4 (84.3) — (214.7) 826.4 Fixed maturities, trading 4.9 — — — 4.9 Other investments — (41.0) — — (41.0) Separate account assets (5) 38.5 (8,206.2) (191.5) 98.2 (8,261.0) Liabilities Investment and universal life contracts — — (16.4) 46.0 29.6 Derivatives Net derivative assets (liabilities) — 12.0 — — 12.0 For the year ended December 31, 2020 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 169.2 $ (5.5) $ — $ (45.7) $ 118.0 Commercial mortgage-backed securities — — — (0.1) (0.1) Collateralized debt obligations 182.5 — — 0.5 183.0 Other debt obligations 14.3 — — (52.2) (37.9) Total fixed maturities, available-for-sale 366.0 (5.5) — (97.5) 263.0 Other investments 0.5 (11.0) — — (10.5) Separate account assets (5) 309.2 (658.2) (396.1) 206.6 (538.5) Liabilities Investment and universal life contracts — — (23.0) 24.6 1.6 Derivatives Net derivative assets (liabilities) — (3.4) — — (3.4) For the year ended December 31, 2019 Net purchases, sales, issuances Purchases Sales Issuances Settlements and settlements (in millions) Assets Fixed maturities, available-for-sale: Non-U.S. governments $ — $ — $ — $ (4.6) $ (4.6) Corporate 41.9 (1.4) — (23.3) 17.2 Commercial mortgage-backed securities 2.4 — — — 2.4 Collateralized debt obligations 124.7 — — (2.2) 122.5 Other debt obligations 107.7 — — (7.7) 100.0 Total fixed maturities, available-for-sale 276.7 (1.4) — (37.8) 237.5 Fixed maturities, trading 0.5 — — (0.2) 0.3 Other investments 10.7 (4.9) — — 5.8 Separate account assets (5) 279.1 (526.4) (280.4) 313.5 (214.2) Liabilities Investment and universal life contracts — — (33.4) 10.1 (23.3) Derivatives Net derivative assets (liabilities) 1.9 8.8 — — 10.7 (5) Issuances and settlements include amounts related to mortgage encumbrances associated with real estate in our separate accounts. |
Transfers (Table) | For the year ended December 31, 2021 Transfers out Transfers out Transfers out Transfers out of Level 1 into of Level 2 into of Level 3 into of Level 3 into Level 3 Level 3 Level 1 Level 2 (in millions) Assets Fixed maturities, available-for-sale: State and political subdivisions $ — $ 82.4 $ — $ — Corporate — 175.8 — — Collateralized debt obligations — 74.1 — 435.8 Other debt obligations — 20.6 — 25.0 Total fixed maturities, available-for-sale — 352.9 — 460.8 For the year ended December 31, 2020 Transfers out Transfers out Transfers out Transfers out of Level 1 into of Level 2 into of Level 3 into of Level 3 into Level 3 Level 3 Level 1 Level 2 (in millions) Assets Fixed maturities, available-for-sale: Corporate $ — $ 342.0 $ — $ 255.2 Commercial mortgage-backed securities — 0.3 — — Collateralized debt obligations — — — 330.6 Other debt obligations — 46.1 — 68.9 Total fixed maturities, available-for-sale — 388.4 — 654.7 Fixed maturities, trading — — — 0.3 Derivatives Net derivative assets (liabilities) — — — 26.5 For the year ended December 31, 2019 Transfers out Transfers out Transfers out Transfers out of Level 1 into of Level 2 into of Level 3 into of Level 3 into Level 3 Level 3 Level 1 Level 2 (in millions) Assets Fixed maturities, available-for- sale: Corporate $ — $ 4.1 $ — $ — Commercial mortgage-backed securities — 3.7 — 2.3 Collateralized debt obligations — 69.9 — — Other debt obligations — 8.3 — 76.3 Total fixed maturities, available-for-sale — 86.0 — 78.6 Other investments — 10.0 — — Separate account assets — — — 173.2 |
Quantitative Information about Level 3 Fair Value Measurements (Table) | December 31, 2021 Assets / (liabilities) measured at Valuation Unobservable Input/range of Weighted fair value technique(s) input description inputs average (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 829.9 Discounted cash flow Discount rate (1) 0.9 %- 15.5 % 6.8 % Illiquidity premium 0 basis points ("bps")- 70 bps 6 bps Market comparables Potential loss severity 39.4 % 39.4 % Probability of default 100.0 % 100.0 % Commercial mortgage-backed securities 3.5 Discounted cash flow Discount rate (1) 3.7 % 3.7 % Collateralized debt obligations 45.9 Discounted cash flow Discount rate (1) 3.0 %- 5.3 % 4.0 % Illiquidity premium 0 bps- 385 bps 255 bps Other debt obligations 22.1 Discounted cash flow Discount rate (1) 3.0 %- 10.0 % 3.3 % Illiquidity premium 225 bps- 500 bps 237 bps Fixed maturities, trading 4.9 Discounted cash flow Discount rate (1) 7.5 % 7.5 % Other investments 0.6 Market comparables - other investments Revenue multiples (2) 6.8 x- 9.1 x 8.0 x Separate account assets 946.0 Discounted cash flow - mortgage loans Discount rate (1) 1.4 % 1.4 % Credit spread rate 120 bps 120 bps Discounted cash flow - real estate Discount rate (1) 5.3 %- 10.0 % 6.6 % Terminal capitalization rate 4.3 %- 9.3 % 5.6 % Average market rent growth rate 1.6 %- 3.6 % 2.7 % Discounted cash flow - real estate debt Loan to value 40.1 %- 58.5 % 46.0 % Market interest rate 2.5 %- 3.1 % 2.7 % Liabilities Investment and universal life contracts (6) (356.3) Discounted cash flow Long duration interest rate 1.8 %- 1.9 % (3) 1.9 % Long-term equity market volatility 18.0 %- 32.5 % 22.1 % Nonperformance risk 0.3 %- 1.1 % 0.9 % Utilization rate See note (4) Lapse rate 0.0 %- 17.0 % 5.1 % Mortality rate See note (5) December 31, 2020 Assets / (liabilities) measured at Valuation Unobservable Input/range of Weighted fair value technique(s) input description inputs average (in millions) Assets Fixed maturities, available-for-sale: Corporate $ 286.1 Discounted cash flow Discount rate (1) 0.9 %- 11.7 % 7.3 % Illiquidity premium 0 bps- 60 bps 19 bps Comparability adjustment 0 bps- 769 bps 359 bps Potential loss severity 54.6 % 54.6 % Probability of default 100.0 % 100.0 % Commercial mortgage-backed securities 1.1 Discounted cash flow Probability of default 100.0 % 100.0 % Potential loss severity 78.4 % 78.4 % Collateralized debt obligations 0.7 Discounted cash flow Potential loss severity 40.5 % 40.5 % Probability of default 100.0 % 100.0 % Other debt obligations 0.8 Discounted cash flow Discount rate (1) 10.0 % 10.0 % Illiquidity premium 500 bps 500 bps Other investments 30.4 Discounted cash flow - other investments Discount rate (1) 25.0 %- 30.0 % 27.5 % Terminal earnings before interest, taxes, depreciation and amortization multiple 3.8 x- 4.7 x 4.2 x Market comparables - other investments Revenue multiples (2) 6.0 x- 8.0 x 7.0 x Discounted cash flow - real estate Discount rate (1) 6.5 % 6.5 % Terminal capitalization rate 5.3 % 5.3 % Average market rent growth rate 2.6 % 2.6 % Discounted cash flow - real estate debt Loan to value 52.6 % 52.6 % Credit spread 3.3 % 3.3 % Separate account assets 8,893.2 Discounted cash flow - mortgage loans Discount rate (1) 1.2 % 1.2 % Illiquidity premium 60 bps 60 bps Credit spread rate 110 bps 110 bps Discounted cash flow - real estate Discount rate (1) 5.6 %- 11.9 % 6.9 % Terminal capitalization rate 4.5 %- 9.3 % 5.7 % Average market rent growth rate 1.5 %- 4.8 % 3.0 % Discounted cash flow - real estate debt Loan to value 6.3 %- 74.2 % 47.5 % Market interest rate 2.0 %- 5.0 % 3.4 % Liabilities Investment and universal life contracts (6) (467.8) Discounted cash flow Long duration interest rate 1.2 %- 1.4 % (3) 1.3 % Long-term equity market volatility 17.6 %- 26.9 % 19.6 % Nonperformance risk 0.1 %- 1.4 % 0.9 % Utilization rate See note (4) Lapse rate 0.0 %- 16.0 % 5.8 % Mortality rate See note (5) (1) Represents market comparable interest rate or an index adjusted rate used as the base rate in the discounted cash flow analysis prior to any illiquidity or other adjustments, where applicable. (2) Revenue multiples are amounts used when we have determined market participants would use such multiples to value the investments. (3) Represents the range of rate curves used in the valuation analysis that we have determined market participants would use when pricing the instrument. Derived from interpolation between various observable swap rates. (4) This input factor is the number of contractholders taking withdrawals as well as the amount and timing of the withdrawals and a range does not provide a meaningful presentation. (5) This input is based on an appropriate industry mortality table and a range does not provide a meaningful presentation. (6) Includes bifurcated embedded derivatives that are reported at net asset (liability) fair value within the same line item in the consolidated statements of financial position in which the host contract is reported. |
Fair Value Option (Table) | December 31, 2021 December 31, 2020 (in millions) Real estate ventures (1) Fair value $ — $ 28.5 (1) Reported with other investments in the consolidated statements of financial position. For the year ended December 31, 2021 2020 2019 (in millions) Commercial mortgage loans of consolidated VIEs Change in fair value pre-tax gain (loss) (1) (2) $ — $ — $ 0.1 Interest income (3) — — 0.3 Real estate ventures Change in fair value pre-tax gain (4) 12.5 5.3 6.0 (1) None of the change in fair value related to instrument-specific credit risk. (2) Reported in net realized capital gains (losses) on the consolidated statements of operations. (3) Reported in net investment income on the consolidated statements of operations and recorded based on the effective interest rates as determined at the closing of the loan. (4) Reported in net investment income on the consolidated statements of operations. |
Financial Instruments Not Reported at Fair Value (Table) | December 31, 2021 Fair value hierarchy level Carrying amount Fair value Level 1 Level 2 Level 3 (in millions) Assets (liabilities) Mortgage loans $ 19,668.7 $ 20,602.7 $ — $ — $ 20,602.7 Policy loans 759.6 952.9 — — 952.9 Other investments 304.0 294.8 — 198.6 96.2 Cash and cash equivalents 1,214.2 1,214.2 1,197.8 16.4 — Investment contracts (35,810.4) (36,088.6) — (7,454.3) (28,634.3) Short-term debt (79.8) (79.8) — (79.8) — Long-term debt (4,280.2) (4,793.1) — (4,755.1) (38.0) Separate account liabilities (165,098.7) (164,028.9) — — (164,028.9) Bank deposits (1) (373.3) (372.8) — (372.8) — Cash collateral payable (214.9) (214.9) (214.9) — — December 31, 2020 Fair value hierarchy level Carrying amount Fair value Level 1 Level 2 Level 3 (in millions) Assets (liabilities) Mortgage loans $ 17,343.0 $ 18,762.6 $ — $ — $ 18,762.6 Policy loans 784.0 1,037.7 — — 1,037.7 Other investments 347.2 338.5 — 247.1 91.4 Cash and cash equivalents 1,383.4 1,383.4 1,369.7 13.7 — Investment contracts (35,449.9) (36,738.7) — (5,276.9) (31,461.8) Short-term debt (84.7) (84.7) — (84.7) — Long-term debt (4,279.2) (4,949.9) — (4,908.7) (41.2) Separate account liabilities (160,316.4) (159,129.2) — — (159,129.2) Bank deposits (1) (423.5) (429.7) — (429.7) — Cash collateral payable (224.6) (224.6) (224.6) — — (1) Excludes deposit liabilities without defined or contractual maturities. |
Statutory Insurance Financial_2
Statutory Insurance Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Statutory Insurance Financial Information | |
Statutory Net Income and Statutory Capital and Surplus of Principal Life (Table) | As of or for the year ended December 31, 2021 2020 2019 (in millions) Statutory net income $ 864.0 $ 915.9 $ 989.3 Statutory capital and surplus 5,375.2 5,682.4 5,193.4 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Segment Information | |
Reconciliation of Assets from Segment to Consolidated (Table) | December 31, 2021 December 31, 2020 (in millions) Assets: Retirement and Income Solutions $ 221,993.8 $ 207,288.4 Principal Global Investors 2,445.1 2,294.3 Principal International 42,812.4 51,707.6 U.S. Insurance Solutions 33,222.6 31,438.9 Corporate 4,183.3 3,898.5 Total consolidated assets $ 304,657.2 $ 296,627.7 |
Reconciliation of Operating Revenues and Pre-tax Operating Earnings (Losses) by Segment (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Operating revenues by segment: Retirement and Income Solutions: Retirement and Income Solutions – Fee $ 2,322.7 $ 2,149.8 $ 2,003.0 Retirement and Income Solutions – Spread 4,187.3 5,353.7 6,951.4 Total Retirement and Income Solutions (1) 6,510.0 7,503.5 8,954.4 Principal Global Investors (2) 1,828.0 1,539.1 1,505.8 Principal International 1,351.8 1,096.8 1,523.2 U.S. Insurance Solutions: Specialty Benefits insurance 2,709.6 2,525.4 2,493.6 Individual Life insurance 2,057.2 1,955.0 1,955.6 Eliminations (0.2) (0.2) (0.2) Total U.S. Insurance Solutions 4,766.6 4,480.2 4,449.0 Corporate 1.8 (39.7) (39.3) Total segment operating revenues 14,458.2 14,579.9 16,393.1 Net realized capital gains (losses), net of related revenue adjustments (164.0) 195.3 (98.5) Adjustments related to equity method investments (31.5) (33.5) (72.5) Total revenues per consolidated statements of operations $ 14,262.7 $ 14,741.7 $ 16,222.1 Pre-tax operating earnings (losses) by segment: Retirement and Income Solutions $ 1,141.2 $ 966.9 $ 874.0 Principal Global Investors 708.4 512.9 483.3 Principal International 309.0 243.6 390.7 U.S. Insurance Solutions 470.8 239.9 521.6 Corporate (368.0) (326.4) (380.3) Total segment pre-tax operating earnings 2,261.4 1,636.9 1,889.3 Pre-tax net realized capital gains (losses), as adjusted (3) (179.8) 63.6 (140.9) Adjustments related to equity method investments and noncontrolling interest 2.0 (7.0) (55.1) Income before income taxes per consolidated statements of operations $ 2,083.6 $ 1,693.5 $ 1,693.3 (1) Reflects inter-segment revenues of $413.1 million, $342.6 million and $357.8 million for the years ended December 31, 2021, 2020 and 2019, respectively. (2) Reflects inter-segment revenues of $308.9 million, $273.8 million and $264.9 million for the years ended December 31, 2021, 2020 and 2019, respectively. (3) Pre-tax net realized capital gains (losses), as adjusted, is derived as follows: For the year ended December 31, 2021 2020 2019 (in millions) Net realized capital gains (losses) $ 2.5 $ 302.6 $ (52.8) Derivative and hedging-related revenue adjustments (160.3) (132.9) (80.4) Market value adjustments to fee revenues (0.6) (1.6) — Adjustments related to equity method investments (24.0) (1.5) 2.6 Adjustments related to sponsored investment funds 21.3 17.3 23.6 Recognition of front-end fee revenue (2.9) 11.4 8.5 Net realized capital gains (losses), net of related revenue adjustments (164.0) 195.3 (98.5) Amortization of deferred acquisition costs and other actuarial balances 11.1 (26.8) (40.8) Capital gains distributed (106.7) (49.9) (68.2) Market value adjustments of embedded derivatives 79.8 (55.0) 66.6 Pre-tax net realized capital gains (losses), as adjusted (a) $ (179.8) $ 63.6 $ (140.9) (a) As adjusted before noncontrolling interest capital gains (losses). |
Reconciliation of Other Significant Reconciling Items from Segments to Consolidated (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Income tax expense (benefit) by segment: Retirement and Income Solutions $ 130.1 $ 106.6 $ 71.8 Principal Global Investors 192.3 141.9 121.8 Principal International 69.8 62.0 106.8 U.S. Insurance Solutions 92.3 47.9 101.8 Corporate (70.7) (87.9) (82.0) Total segment income taxes from operating earnings 413.8 270.5 320.2 Tax expense (benefit) related to net realized capital losses, as adjusted (56.2) 28.2 1.3 Certain adjustments related to equity method investments and noncontrolling interest (31.4) (33.7) (72.3) Total income taxes per consolidated statements of operations $ 326.2 $ 265.0 $ 249.2 |
Reconciliation of Depreciation and Amortization Expense from Segments to Consolidated (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Depreciation and amortization expense by segment: Retirement and Income Solutions $ 81.7 $ 69.1 $ 48.2 Principal Global Investors 21.1 21.6 18.9 Principal International 57.3 56.0 58.6 U.S. Insurance Solutions 24.2 25.1 25.0 Corporate 23.7 14.8 16.1 Total depreciation and amortization expense included in our consolidated statements of operations $ 208.0 $ 186.6 $ 166.8 |
Revenues from Contracts with _2
Revenues from Contracts with Customers (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Revenue from contracts with customers by segment: Retirement and Income Solutions: Retirement and Income Solutions – Fee $ 580.2 $ 591.2 $ 455.5 Retirement and Income Solutions – Spread 9.9 8.6 9.3 Total Retirement and Income Solutions 590.1 599.8 464.8 Principal Global Investors 1,787.9 1,511.2 1,456.7 Principal International 492.7 439.2 462.2 U.S. Insurance Solutions: Specialty Benefits insurance 14.9 14.8 14.9 Individual Life insurance 60.6 48.6 51.2 Eliminations (0.2) (0.2) (0.2) Total U.S. Insurance Solutions 75.3 63.2 65.9 Corporate 204.1 154.9 160.4 Total segment revenue from contracts with customers 3,150.1 2,768.3 2,610.0 Adjustments for fees and other revenues not within the scope of revenue recognition guidance (1) 1,866.0 1,733.0 1,791.4 Pre-tax other adjustments (2) (3.5) 9.8 8.5 Total fees and other revenues per consolidated statements of operations $ 5,012.6 $ 4,511.1 $ 4,409.9 (1) Fees and other revenues not within the scope of the revenue recognition guidance primarily represent revenue on contracts accounted for under the financial instruments or insurance contracts standards. (2) Pre-tax other adjustments relate to the recognition of deferred front-end fee revenues for sales charges on retirement and life insurance products and certain market value adjustments to fee revenues. |
Retirement and Income Solutions | Retirement and Income Solutions - Fee | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Administrative service fee revenue $ 576.7 $ 589.2 $ 453.7 Other fee revenue 3.5 2.0 1.8 Total revenues from contracts with customers 580.2 591.2 455.5 Fees and other revenues not within the scope of revenue recognition guidance 1,299.6 1,130.4 1,139.0 Total fees and other revenues 1,879.8 1,721.6 1,594.5 Premiums and other considerations 0.5 5.0 3.5 Net investment income 442.4 423.2 405.0 Total operating revenues $ 2,322.7 $ 2,149.8 $ 2,003.0 |
Retirement and Income Solutions | Retirement and Income Solutions - Spread | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Deposit account fee revenue $ 9.2 $ 8.4 $ 9.3 Commission income 0.7 0.2 — Total revenues from contracts with customers 9.9 8.6 9.3 Fees and other revenues not within the scope of revenue recognition guidance 7.9 9.5 13.9 Total fees and other revenues 17.8 18.1 23.2 Premiums and other considerations 1,883.1 3,216.0 4,859.2 Net investment income 2,286.4 2,119.6 2,069.0 Total operating revenues $ 4,187.3 $ 5,353.7 $ 6,951.4 |
Principal Global Investors | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Management fee revenue $ 1,514.1 $ 1,298.4 $ 1,239.1 Other fee revenue 273.8 212.8 217.6 Total revenues from contracts with customers 1,787.9 1,511.2 1,456.7 Fees and other revenues not within the scope of revenue recognition guidance 36.2 22.3 38.5 Total fees and other revenues 1,824.1 1,533.5 1,495.2 Net investment income 3.9 5.6 10.6 Total operating revenues $ 1,828.0 $ 1,539.1 $ 1,505.8 |
Principal International | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Management fee revenue $ 484.4 $ 435.3 $ 459.3 Other fee revenue 8.3 3.9 2.9 Total revenues from contracts with customers 492.7 439.2 462.2 Fees and other revenues not within the scope of revenue recognition guidance 4.1 5.6 6.3 Total fees and other revenues 496.8 444.8 468.5 Premiums and other considerations 127.5 156.6 393.3 Net investment income 727.5 495.4 661.4 Total operating revenues $ 1,351.8 $ 1,096.8 $ 1,523.2 Revenues from contracts with customers by region: Latin America $ 362.6 $ 323.5 $ 351.5 Asia 128.8 115.9 111.0 Principal International corporate / regional offices 2.6 0.9 0.9 Eliminations (1.3) (1.1) (1.2) Total revenues from contracts with customers $ 492.7 $ 439.2 $ 462.2 |
U.S. Insurance Solutions | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Specialty Benefits insurance: Administrative service fees $ 14.9 $ 14.8 $ 14.9 Total revenues from contracts with customers 14.9 14.8 14.9 Fees and other revenues not within the scope of revenue recognition guidance 19.0 19.3 19.6 Total fees and other revenues 33.9 34.1 34.5 Premiums and other considerations 2,496.4 2,330.7 2,292.7 Net investment income 179.3 160.6 166.4 Total operating revenues $ 2,709.6 $ 2,525.4 $ 2,493.6 Individual Life insurance: Administrative service fees $ 26.7 $ 21.8 $ 24.3 Commission income 33.9 26.8 26.9 Total revenues from contracts with customers 60.6 48.6 51.2 Fees and other revenues not within the scope of revenue recognition guidance 859.2 849.8 875.9 Total fees and other revenues 919.8 898.4 927.1 Premiums and other considerations 334.0 329.1 317.9 Net investment income 803.4 727.5 710.6 Total operating revenues $ 2,057.2 $ 1,955.0 $ 1,955.6 |
Corporate | |
Revenues from Contracts with Customers | |
Disaggregation of Revenues from Contracts with Customers (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Commission income $ 388.9 $ 316.6 $ 320.2 Other fee revenue 68.8 59.1 46.1 Eliminations (253.6) (220.8) (205.9) Total revenues from contracts with customers 204.1 154.9 160.4 Fees and other revenues not within the scope of revenue recognition guidance (360.0) (303.9) (301.8) Total fees and other revenues (155.9) (149.0) (141.4) Net investment income 157.7 109.3 102.1 Total operating revenues $ 1.8 $ (39.7) $ (39.3) |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Stock-Based Compensation Plans | |
Stock-Based Compensation Disclosures (Table) | For the year ended December 31, 2021 2020 2019 (in millions) Compensation cost $ 95.2 $ 86.7 $ 78.7 Related income tax benefit 19.9 17.1 16.8 Capitalized as part of an asset 1.4 1.5 1.7 |
Nonqualified Stock Options Status (Table) | Weighted- average Number of options exercise price Intrinsic value (in millions) (in millions) Options outstanding as of January 1, 2021 6.5 $ 49.52 Granted 0.8 58.68 Exercised 1.0 41.92 Canceled 0.1 56.93 Options outstanding as of December 31, 2021 6.2 $ 51.89 $ 126.9 Options vested or expected to vest as of December 31, 2021 6.2 $ 51.88 $ 126.7 Options exercisable as of December 31, 2021 4.6 $ 50.76 $ 99.2 |
Nonqualified Stock Options Remaining Contractual Lives and Range of Exercise Prices (Table) | Weighted- Number of options average remaining Range of exercise prices outstanding contractual life (in millions) $27.46 - $48.11 1.4 2.5 $48.12 - $52.41 1.6 7.0 $52.42 - $55.89 1.1 7.2 $55.90 - $62.75 0.8 9.1 $62.76 - $63.98 1.3 5.7 $27.46 - $63.98 6.2 |
Nonqualified Stock Options Fair Value (Table) | For the year ended December 31, Options 2021 2020 2019 Expected volatility 34.2 % 25.7 % 23.3 % Expected term (in years) 7.0 7.0 7.0 Risk-free interest rate 1.2 % 1.3 % 2.6 % Expected dividend yield 3.82 % 4.33 % 4.07 % Weighted average estimated fair value $ 15.67 $ 9.64 $ 10.00 |
Nonvested Performance Share Awards Activity (Table) | Number of Weighted- performance average grant-date share awards fair value (in millions) Nonvested performance share awards as of January 1, 2021 0.7 $ 55.28 Granted 0.2 58.68 Vested 0.1 63.98 Canceled 0.1 62.16 Nonvested performance share awards as of December 31, 2021 0.7 $ 54.37 |
Nonvested Restricted Stock Units Activity (Table) | Number of Weighted- restricted average grant-date stock units fair value (in millions) Nonvested restricted stock units as of January 1, 2021 2.8 $ 54.86 Granted 1.1 59.17 Vested 0.8 62.01 Canceled 0.1 55.50 Nonvested restricted stock units as of December 31, 2021 3.0 $ 54.50 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Earnings Per Common Share | |
Earnings Per Common Share (Table) | For the year ended December 31, 2021 2020 2019 (in millions, except per share data) Net income $ 1,757.4 $ 1,428.5 $ 1,444.1 Subtract: Net income attributable to noncontrolling interest 46.8 32.7 49.9 Total $ 1,710.6 $ 1,395.8 $ 1,394.2 Weighted-average shares outstanding: Basic 269.0 274.7 278.6 Dilutive effects: Stock options 1.3 0.3 0.9 Restricted stock units 2.1 1.5 1.4 Performance share awards 0.5 0.1 0.1 Diluted 272.9 276.6 281.0 Net income per common share: Basic $ 6.36 $ 5.08 $ 5.00 Diluted $ 6.27 $ 5.05 $ 4.96 |
Nature of Operations and Sign_4
Nature of Operations and Significant Accounting Policies - Recent Accounting Pronouncements (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Recent Accounting Pronouncements | ||||
Stockholders' Equity | $ 16,125.8 | $ 16,617.3 | $ 14,685.8 | $ 11,456 |
Retained earnings (accumulated deficit) | ||||
Recent Accounting Pronouncements | ||||
Stockholders' Equity | $ 12,884.5 | $ 11,838 | 11,074.3 | 10,290.2 |
ASU 2016-13 - CECL | Effects of implementation of accounting change | ||||
Recent Accounting Pronouncements | ||||
Stockholders' Equity | (8.4) | |||
ASU 2016-13 - CECL | Retained earnings (accumulated deficit) | Effects of implementation of accounting change | ||||
Recent Accounting Pronouncements | ||||
Stockholders' Equity | $ (8.4) | |||
ASU 2016-02 - Leases | Effects of implementation of accounting change | ||||
Recent Accounting Pronouncements | ||||
Stockholders' Equity | 4 | |||
ASU 2016-02 - Leases | Retained earnings (accumulated deficit) | Effects of implementation of accounting change | ||||
Recent Accounting Pronouncements | ||||
Stockholders' Equity | $ 4 |
Nature of Operations and Sign_5
Nature of Operations and Significant Accounting Policies - Cash and Cash Equivalents, Investments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Cash and Cash Equivalents | ||
Maximum maturity period when purchased for investments to be included in cash and cash equivalents | 3 months | |
Investments | ||
Real estate held for sale | $ 88.7 | $ 2 |
Nature of Operations and Sign_6
Nature of Operations and Significant Accounting Policies - Contractholder and Policyholder Liabilities (Details) - Individual Life insurance | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Contractholder and Policyholder Liabilities | |||
Participating business as a percentage of life insurance in force (as a percent) | 4.00% | 5.00% | 6.00% |
Participating business as a percentage of life insurance policies in force (as a percent) | 18.00% | 20.00% | 23.00% |
Participating business as a percentage of life insurance premiums (as a percent) | 22.00% | 24.00% | 21.00% |
Nature of Operations and Sign_7
Nature of Operations and Significant Accounting Policies - Other Various Policies (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021USD ($)Counterparty | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Long-Term Debt | |||
Minimum maturity period at date of issuance for debt to be classified as long-term | 1 year | ||
Reinsurance | |||
Net ceded reinsurance recoverables related to claims received | $ 1,186.6 | $ 1,095.3 | |
Amount of net ceded reinsurance recoverables related to claims received with five largest ceded reinsurers | $ 578 | $ 506.3 | |
Percentage of net ceded reinsurance recoverables related to claims received with five largest ceded reinsurers (as a percent) | 95.00% | 97.00% | |
Number of largest ceded reinsurers | Counterparty | 5 | ||
Premiums and other considerations: | |||
Premiums and other considerations, Direct | $ 5,492.1 | $ 6,647.1 | $ 8,429.7 |
Premiums and other considerations, Ceded | (650.6) | (609.7) | (563.1) |
Premiums and other considerations | 4,841.5 | 6,037.4 | 7,866.6 |
Benefits, claims and settlement expenses: | |||
Benefits, claims and settlement expenses, Direct | 7,766.2 | 8,810.1 | 10,486.7 |
Benefits, claims and settlement expenses, Ceded | (669.2) | (528.6) | (580.9) |
Benefits, claims and settlement expenses | 7,097 | 8,281.5 | $ 9,905.8 |
Separate Accounts | |||
Separate account that primarily includes shares of Principal Financial Group, Inc. stock that were allocated and issued to eligible participants of qualified employee benefit plans as part of the 2001 demutualization | $ 95.1 | $ 80.4 |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Changes in Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Changes in Goodwill | ||
Beginning balance, Goodwill | $ 1,711 | $ 1,693.8 |
Goodwill disposed | (2.3) | |
Impairment | (1) | |
Foreign currency, Goodwill | (80.1) | 17.2 |
Ending balance, Goodwill | 1,627.6 | 1,711 |
Retirement and Income Solutions | ||
Changes in Goodwill | ||
Beginning balance, Goodwill | 675.9 | 675.9 |
Ending balance, Goodwill | 675.9 | 675.9 |
Principal Global Investors | ||
Changes in Goodwill | ||
Beginning balance, Goodwill | 320.9 | 317.5 |
Foreign currency, Goodwill | (2.5) | 3.4 |
Ending balance, Goodwill | 318.4 | 320.9 |
Principal International | ||
Changes in Goodwill | ||
Beginning balance, Goodwill | 656.6 | 642.8 |
Goodwill disposed | (2.3) | |
Foreign currency, Goodwill | (77.6) | 13.8 |
Ending balance, Goodwill | 576.7 | 656.6 |
U.S. Insurance Solutions | ||
Changes in Goodwill | ||
Beginning balance, Goodwill | 56.6 | 56.6 |
Ending balance, Goodwill | 56.6 | 56.6 |
Corporate | ||
Changes in Goodwill | ||
Beginning balance, Goodwill | 1 | 1 |
Impairment | $ (1) | |
Ending balance, Goodwill | $ 1 |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Finite-Lived Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Finite Lived Intangible Asset Disclosures | |||
Weighted average remaining expected life of finite lived intangible assets | 17 years | ||
Gross carrying amount | $ 1,262.8 | $ 1,338.2 | |
Accumulated amortization | 432.1 | 405.6 | |
Net carrying amount | 830.7 | 932.6 | |
Amortization expense for intangible assets with finite useful lives | 75.3 | 73.5 | $ 62.8 |
Estimated amortization expense for the next five years | |||
Year 1: Finite lived intangible assets amortization | 71.1 | ||
Year 2: Finite lived intangible assets amortization | 68.3 | ||
Year 3: Finite lived intangible assets amortization | 67 | ||
Year 4: Finite lived intangible assets amortization | 60.7 | ||
Year 5: Finite lived intangible assets amortization | 56.6 | ||
Other finite lived intangible assets | |||
Finite Lived Intangible Asset Disclosures | |||
Amortization expense for intangible assets with finite useful lives | $ 15 | $ 18.7 |
Goodwill and Other Intangible_5
Goodwill and Other Intangible Assets - Indefinite-Lived Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Indefinite Lived Intangible Assets | ||
Net carrying amount of unamortized indefinite lived intangible assets | $ 769.9 | $ 790.4 |
WM Advisors, Inc. | ||
Indefinite Lived Intangible Assets | ||
Net carrying amount of unamortized indefinite lived intangible assets | $ 608 | $ 608 |
Variable Interest Entities - Co
Variable Interest Entities - Consolidated VIEs (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | $ 304,657.2 | $ 296,627.7 | ||
Total liabilities | 288,198.9 | 279,754.8 | ||
Redeemable noncontrolling interest | 332.5 | 255.6 | $ 264.9 | $ 391.2 |
Aggregate consolidated variable interest entities | ||||
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | 37,269.2 | 43,233.5 | ||
Total liabilities | 34,360.7 | 41,552.4 | ||
Redeemable noncontrolling interest | 304 | 226.8 | ||
Mandatory retirement savings funds | ||||
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | 34,687 | 41,995.2 | ||
Total liabilities | 34,301.8 | 41,527.9 | ||
Real estate VIE | ||||
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | 709.6 | 499 | ||
Total liabilities | 36.1 | 21.3 | ||
Sponsored investment funds | ||||
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | 609.4 | 419.5 | ||
Total liabilities | 2.5 | 3.2 | ||
Redeemable noncontrolling interest | 304 | 226.8 | ||
Residential mortgage loans VIE | ||||
Carrying amounts of consolidated VIE assets and liabilities | ||||
Total assets | 1,263.2 | $ 319.8 | ||
Total liabilities | $ 20.3 |
Variable Interest Entities - Un
Variable Interest Entities - Unconsolidated VIEs (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | $ 304,657.2 | $ 296,627.7 |
Money Market Funds | ||
Total assets of unconsolidated money market mutual funds | 4,800 | 4,400 |
Corporate debt securities | Available-for-sale | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 142.1 | 296.9 |
Maximum exposure to loss | 136.9 | 285.7 |
Residential mortgage-backed pass-through securities | Available-for-sale | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 3,152.9 | 2,986.8 |
Maximum exposure to loss | 3,122.3 | 2,857.6 |
Residential mortgage-backed pass-through securities | Trading | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 117.4 | 190.5 |
Maximum exposure to loss | 117.4 | 190.5 |
Commercial mortgage-backed securities | Available-for-sale | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 5,562.2 | 4,942.3 |
Maximum exposure to loss | 5,436.2 | 4,741.2 |
Commercial mortgage-backed securities | Trading | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 25.6 | 27.1 |
Maximum exposure to loss | 25.6 | 27.1 |
Collateralized debt obligations | Available-for-sale | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 3,559.6 | 4,027.5 |
Maximum exposure to loss | 3,564.7 | 4,045.9 |
Collateralized debt obligations | Trading | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 7.5 | 20.6 |
Maximum exposure to loss | 7.5 | 20.6 |
Other debt obligations | Available-for-sale | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 7,560.4 | 7,045.9 |
Maximum exposure to loss | 7,487.8 | 6,832.6 |
Other debt obligations | Trading | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 8.2 | 9.4 |
Maximum exposure to loss | 8.2 | 9.4 |
Equity securities | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 115.4 | 121.7 |
Maximum exposure to loss | 115.4 | 121.7 |
Other investments: Other limited partnership and fund interests | Variable Interest Entity | ||
Unconsolidated Variable Interest Entity disclosures | ||
Asset carrying value | 1,209.6 | 999.1 |
Maximum exposure to loss | 2,053.8 | 1,739 |
Fully secured debt of international real estate funds with recourse to the investment manager, included in maximum loss exposure | $ 130.5 | $ 141.2 |
Investments - Fixed Maturities
Investments - Fixed Maturities and Equity Securities (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Available-for-sale securities | ||
Amortized cost, fixed maturities | $ 72,869.9 | $ 70,546.8 |
Gross unrealized gains, fixed maturities | 5,708.6 | 8,380 |
Gross unrealized losses, fixed maturities | 408.5 | 209.1 |
Allowance, fixed maturities | 15.5 | 7.4 |
Fair value, fixed maturities | 78,154.5 | 78,710.3 |
Accrued interest receivable | 542.6 | 552.5 |
U.S. government and agencies | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 1,978 | 1,893.1 |
Gross unrealized gains, fixed maturities | 148 | 228.9 |
Gross unrealized losses, fixed maturities | 37.4 | 10.5 |
Fair value, fixed maturities | 2,088.6 | 2,111.5 |
Non-U.S. governments | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 851 | 881.6 |
Gross unrealized gains, fixed maturities | 133.1 | 192.1 |
Gross unrealized losses, fixed maturities | 2.1 | |
Fair value, fixed maturities | 982 | 1,073.7 |
States and political subdivisions | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 8,290.7 | 8,004.9 |
Gross unrealized gains, fixed maturities | 1,030.3 | 1,175.5 |
Gross unrealized losses, fixed maturities | 16.6 | 12.6 |
Fair value, fixed maturities | 9,304.4 | 9,167.8 |
Corporate debt securities | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 42,139.2 | 41,289.9 |
Gross unrealized gains, fixed maturities | 4,044.8 | 6,160.9 |
Gross unrealized losses, fixed maturities | 224.5 | 95.1 |
Allowance, fixed maturities | 15.1 | 0.9 |
Fair value, fixed maturities | 45,944.4 | 47,354.8 |
Residential mortgage-backed pass-through securities | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 3,122.3 | 2,857.6 |
Gross unrealized gains, fixed maturities | 59 | 129.4 |
Gross unrealized losses, fixed maturities | 28.4 | 0.2 |
Fair value, fixed maturities | 3,152.9 | 2,986.8 |
Commercial mortgage-backed securities | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 5,436.2 | 4,741.2 |
Gross unrealized gains, fixed maturities | 157.8 | 241.3 |
Gross unrealized losses, fixed maturities | 31.5 | 35.9 |
Allowance, fixed maturities | 0.3 | 4.3 |
Fair value, fixed maturities | 5,562.2 | 4,942.3 |
Collateralized debt obligations | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 3,564.7 | 4,045.9 |
Gross unrealized gains, fixed maturities | 4.5 | 8.7 |
Gross unrealized losses, fixed maturities | 9.6 | 24.9 |
Allowance, fixed maturities | 2.2 | |
Fair value, fixed maturities | 3,559.6 | 4,027.5 |
Other debt obligations | ||
Available-for-sale securities | ||
Amortized cost, fixed maturities | 7,487.8 | 6,832.6 |
Gross unrealized gains, fixed maturities | 131.1 | 243.2 |
Gross unrealized losses, fixed maturities | 58.4 | 29.9 |
Allowance, fixed maturities | 0.1 | |
Fair value, fixed maturities | $ 7,560.4 | $ 7,045.9 |
Investments - Amortization by E
Investments - Amortization by Expected Maturity (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Amortized cost of fixed maturities available-for-sale | ||
Due in one year or less | $ 1,647.3 | |
Due after one year through five years | 11,267.1 | |
Due after five years through ten years | 14,795.7 | |
Due after ten years | 25,548.8 | |
Subtotal | 53,258.9 | |
Mortgage-backed and other asset-backed securities | 19,611 | |
Amortized cost, fixed maturities | 72,869.9 | $ 70,546.8 |
Fair value of fixed maturities available-for-sale | ||
Due in one year or less | 1,666.8 | |
Due after one year through five years | 11,749.9 | |
Due after five years through ten years | 15,797.6 | |
Due after ten years | 29,105.1 | |
Subtotal | 58,319.4 | |
Mortgage-backed and other asset-backed securities | 19,835.1 | |
Fair value, fixed maturities | $ 78,154.5 | $ 78,710.3 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Major categories of net investment income | |||
Gross investment income (loss) | $ 4,521.2 | $ 4,001.2 | $ 4,116.5 |
Investment expenses | (115.1) | (110.6) | (118.1) |
Net investment income (loss) | 4,406.1 | 3,890.6 | 3,998.4 |
Fixed maturities | Available-for-sale | |||
Major categories of net investment income | |||
Gross investment income (loss) | 2,766.3 | 2,660.5 | 2,606 |
Fixed maturities | Trading | |||
Major categories of net investment income | |||
Gross investment income (loss) | 19.3 | 18.7 | 23.8 |
Equity securities | |||
Major categories of net investment income | |||
Gross investment income (loss) | 57.7 | 62.8 | 110.5 |
Mortgage loans | |||
Major categories of net investment income | |||
Gross investment income (loss) | 790.2 | 724.7 | 707 |
Real estate | |||
Major categories of net investment income | |||
Gross investment income (loss) | 194.4 | 180.8 | 191.1 |
Policy loans | |||
Major categories of net investment income | |||
Gross investment income (loss) | 38.8 | 41.6 | 44 |
Cash and cash equivalents | |||
Major categories of net investment income | |||
Gross investment income (loss) | 4.3 | 17.4 | 65.3 |
Derivatives | |||
Major categories of net investment income | |||
Gross investment income (loss) | 28.2 | (1.8) | (2) |
Other investment types | |||
Major categories of net investment income | |||
Gross investment income (loss) | $ 622 | $ 296.5 | $ 370.8 |
Investments - Net Realized Capi
Investments - Net Realized Capital Gains and Losses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Major components of net realized capital gains (losses) on investments | |||
Fixed maturities, available-for-sale: Gross gains | $ 64.4 | $ 134.2 | $ 15.5 |
Fixed maturities, available-for-sale: Gross losses | (29.2) | (48.5) | (15.3) |
Fixed maturities, available-for-sale: Net credit recoveries (losses) | (45) | (22.9) | |
Fixed maturities, available-for-sale: Net credit recoveries (losses) | (43.5) | ||
Fixed maturities, available-for-sale: Hedging, net | (9.5) | (9.7) | (9.3) |
Fixed maturities, trading | (33.3) | 3.2 | 43 |
Equity securities | 100 | 70.5 | 84.5 |
Mortgage loans gains (losses) | 6.5 | (15.5) | 3 |
Derivative net realized capital gains (losses) | (116.9) | 77.3 | (120.3) |
Other gains (losses) | 65.5 | 114 | (10.4) |
Net realized capital gains (losses) | 2.5 | 302.6 | (52.8) |
Unrealized gains (losses) on fixed maturities, trading | (32.2) | 5.3 | 32.8 |
Unrealized gains (losses) on equity securities | 58.6 | 64.6 | 61.6 |
Unrealized gains (losses) on equity securities reported in net investment income | 28.7 | 35.2 | 66.9 |
Proceeds from sales of investments | |||
Proceeds from sales of investments in fixed maturities, available-for-sale | $ 2,110.9 | $ 2,421.9 | $ 1,654.8 |
Investments - Allowance for Cre
Investments - Allowance for Credit Loss (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Rollforward of the allowance for credit loss by major security type | ||
Beginning balance | $ 7.4 | |
Additions for credit losses not previously recorded | 28 | $ 16.2 |
Reductions for securities sold during the period | (12.4) | (7) |
Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period | 2.8 | 0.2 |
Write-offs charged against allowance | (9.4) | (2.6) |
Foreign currency translation adjustment | (0.9) | 0.6 |
Ending balance | 15.5 | 7.4 |
Accrued interest written off to net investment income | 0.2 | |
Corporate debt securities | ||
Rollforward of the allowance for credit loss by major security type | ||
Beginning balance | 0.9 | |
Additions for credit losses not previously recorded | 27.5 | 13.2 |
Reductions for securities sold during the period | (12.4) | (7) |
Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period | (5.9) | |
Foreign currency translation adjustment | (0.9) | 0.6 |
Ending balance | 15.1 | 0.9 |
Accrued interest written off to net investment income | 0.2 | |
Commercial mortgage-backed securities | ||
Rollforward of the allowance for credit loss by major security type | ||
Beginning balance | 4.3 | |
Additions for credit losses not previously recorded | 0.4 | 2.9 |
Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period | 2.4 | 4 |
Write-offs charged against allowance | (6.8) | (2.6) |
Ending balance | 0.3 | 4.3 |
Collateralized debt obligations | ||
Rollforward of the allowance for credit loss by major security type | ||
Beginning balance | 2.2 | |
Additions for credit losses not previously recorded | 0.1 | |
Additional increases (decreases) for credit losses on securities with an allowance recorded in the previous period | 0.4 | 2.1 |
Write-offs charged against allowance | (2.6) | |
Ending balance | $ 2.2 | |
Other debt obligations | ||
Rollforward of the allowance for credit loss by major security type | ||
Additions for credit losses not previously recorded | 0.1 | |
Ending balance | $ 0.1 |
Investments - Other-Than-Tempor
Investments - Other-Than-Temporary Impairments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other-than-temporary impairment losses, net of recoveries | |||
Net realized capital gains (losses), excluding impairment losses on available-for-sale securities | $ (9.3) | ||
Net other-than-temporary impairment (losses) recoveries on available-for-sale securities | (38.3) | ||
Other-than-temporary impairment losses on fixed maturities, available-for-sale reclassified to (from) other comprehensive income | (5.2) | ||
Net impairment (losses) recoveries on available-for-sale securities | (43.5) | ||
Net realized capital gains (losses) | $ 2.5 | $ 302.6 | $ (52.8) |
Investments - Accumulated Credi
Investments - Accumulated Credit Losses for Fixed Maturities with Bifurcated Credit Losses (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Other-Than-Temporary Impairment Credit Losses Recognized in Net Income - Rollforward | |
Beginning balance | $ (117.5) |
Credit losses for which an other-than-temporary impairment was not previously recognized | (6.8) |
Credit losses for which an other-than-temporary impairment was previously recognized | (11.8) |
Reduction for credit losses previously recognized on fixed maturities now sold, paid down or intended to be sold | 54.3 |
Net reduction (increase) for positive changes in cash flows expected to be collected and amortization | 0.8 |
Ending balance | $ (81) |
Investments - Gross Unrealized
Investments - Gross Unrealized Losses for Fixed Maturities (Details) $ in Millions | Dec. 31, 2021USD ($)item | Dec. 31, 2020USD ($)item |
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | $ 14,561.3 | $ 5,909.4 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 227.1 | 138.8 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 3,042.6 | 1,399.1 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 179.3 | 67.4 |
Fixed maturities, Total, Fair value | 17,603.9 | 7,308.5 |
Fixed maturities, Total, Gross unrealized losses | 406.4 | 206.2 |
U.S. government and agencies | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 129.3 | 351.1 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 3.4 | 10.4 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 482.9 | |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 34 | |
Fixed maturities, Total, Fair value | 612.2 | 351.1 |
Fixed maturities, Total, Gross unrealized losses | 37.4 | 10.4 |
Non-U.S. governments | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 57.8 | |
Fixed maturities, Less than twelve months, Gross unrealized losses | 2 | |
Fixed maturities, Total, Fair value | 57.8 | |
Fixed maturities, Total, Gross unrealized losses | 2 | |
States and political subdivisions | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 690.2 | 363.5 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 10.5 | 12.5 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 102.3 | |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 6.1 | |
Fixed maturities, Total, Fair value | 792.5 | 363.5 |
Fixed maturities, Total, Gross unrealized losses | 16.6 | 12.5 |
Corporate debt securities | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 5,281.6 | 1,578.7 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 121.2 | 54.4 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 1,327.5 | 267.9 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 101.5 | 40.6 |
Fixed maturities, Total, Fair value | 6,609.1 | 1,846.6 |
Fixed maturities, Total, Gross unrealized losses | 222.7 | 95 |
Residential mortgage-backed pass-through securities | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 1,562.6 | 92.3 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 22.2 | 0.2 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 194.9 | 1.6 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 6.3 | |
Fixed maturities, Total, Fair value | 1,757.5 | 93.9 |
Fixed maturities, Total, Gross unrealized losses | 28.5 | 0.2 |
Commercial mortgage-backed securities | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 1,297.4 | 970.9 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 15.6 | 22.1 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 299.6 | 137.4 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 15.7 | 12.2 |
Fixed maturities, Total, Fair value | 1,597 | 1,108.3 |
Fixed maturities, Total, Gross unrealized losses | 31.3 | 34.3 |
Collateralized debt obligations | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 1,592.5 | 1,750.6 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 2.8 | 11.1 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 424.4 | 931.1 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 6.7 | 12.9 |
Fixed maturities, Total, Fair value | 2,016.9 | 2,681.7 |
Fixed maturities, Total, Gross unrealized losses | 9.5 | 24 |
Other debt obligations | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 3,949.9 | 802.3 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 49.4 | 28.1 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 211 | 61.1 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 9 | 1.7 |
Fixed maturities, Total, Fair value | 4,160.9 | 863.4 |
Fixed maturities, Total, Gross unrealized losses | 58.4 | 29.8 |
Principal Life Insurance Company | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Less than twelve months, Fair value | 13,052.3 | 5,638.3 |
Fixed maturities, Less than twelve months, Gross unrealized losses | 150.9 | 122.4 |
Fixed maturities, Greater than or equal to twelve months, Fair value | 2,740.3 | 1,391.3 |
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | 137.1 | 51.5 |
Fixed maturities, Total, Fair value | 15,792.6 | 7,029.6 |
Fixed maturities, Total, Gross unrealized losses | $ 288 | $ 173.9 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Qualitative Disclosure | ||
Available-for-sale Securities in Unrealized Loss Positions, Qualitative Disclosure, Percent Investment Grade (as a percent) | 91.00% | 89.00% |
Available-for-sale Securities in Unrealized Loss Positions, Qualitative Disclosure, Average Price (percent of carrying value to amortized cost) | 98.00% | 98.00% |
Available-for-sale Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Less Than Twelve Months | item | 1,805 | 619 |
Available-for-sale Securities in Unrealized Loss Positions, Average Price, Less Than Twelve Months (percent of carrying value to amortized cost) | 99.00% | 98.00% |
Available-for-sale Securities in Unrealized Loss Positions, Percent Investment Grade, Less Than Twelve Months (as a percent) | 90.00% | 89.00% |
Available-for-sale Securities in Unrealized Loss Position, Aggregate Losses On Investment Grade Investments, Less Than Twelve Months | $ 138.9 | $ 98.4 |
Available-for-sale Securities in Unrealized Loss Positions, Qualitative Disclosure, Number of Positions, Twelve Months or Longer | item | 459 | 198 |
Available-for-sale Securities in Unrealized Loss Positions, Average Price, Twelve Months or Longer (percent of carrying value to amortized cost) | 95.00% | 96.00% |
Principal Life Insurance Company | Corporate debt securities | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | $ 67.1 | $ 24.9 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Qualitative Disclosure | ||
Available-for-sale Securities in Unrealized Loss Positions, Average Price, Twelve Months or Longer (percent of carrying value to amortized cost) | 95.00% | 92.00% |
Principal Life Insurance Company | Commercial mortgage-backed securities | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | $ 15.3 | $ 11.9 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Qualitative Disclosure | ||
Available-for-sale Securities in Unrealized Loss Positions, Average Price, Twelve Months or Longer (percent of carrying value to amortized cost) | 95.00% | 92.00% |
Principal Life Insurance Company | Collateralized debt obligations | ||
Gross Unrealized Losses for Fixed Maturities | ||
Fixed maturities, Greater than or equal to twelve months, Gross unrealized losses | $ 6.7 | $ 12.9 |
Available-for-sale Securities, Continuous Unrealized Loss Position, Qualitative Disclosure | ||
Available-for-sale Securities in Unrealized Loss Positions, Average Price, Twelve Months or Longer (percent of carrying value to amortized cost) | 98.00% | 99.00% |
Investments - Net Unrealized Ga
Investments - Net Unrealized Gains and Losses on Available-for-Sale Securities and Derivative Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Net Unrealized Gains and Losses on Available-for-Sale Securities and Derivative Instruments | ||
Net unrealized gains (losses) on fixed maturities, available-for-sale | $ 5,289.9 | $ 8,193 |
Net unrealized gains (losses) on derivative instruments | 80.1 | 38.9 |
Adjustments for assumed changes in amortization patterns | (266.1) | (437.3) |
Adjustments for assumed changes in policyholder liabilities | (689.2) | (2,603.9) |
Net unrealized gains (losses) on other investments and noncontrolling interest adjustments | 40.5 | 78 |
Provision for deferred income tax benefits (taxes) | (936) | (1,112.2) |
Net unrealized gains (losses) on available-for-sale securities and derivative instruments | $ 3,519.2 | $ 4,156.5 |
Investments - Mortgage Loan Cre
Investments - Mortgage Loan Credit Monitoring (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Financing Receivable, Credit Quality Indicator | |||
Mortgage loans, Total amortized cost | $ 20,324.5 | $ 18,103.9 | $ 16,513.9 |
Reinsurance recoverables | 1,189.3 | 1,098 | |
Accrued interest receivable | 542.6 | 552.5 | |
Commercial mortgage loans | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 2,587.3 | ||
2020 | 2,033.6 | 2,019.8 | |
2019 | 2,706.9 | 2,769.9 | |
2018 | 2,523.5 | 2,817.2 | |
2017 | 1,739.3 | 2,049.3 | |
2016 | 1,509.3 | ||
Prior | 4,804.1 | 4,276.1 | |
Mortgage loans, Total amortized cost | 16,394.7 | 15,441.6 | 15,017.2 |
Accrued interest receivable | 60.7 | 60 | |
Commercial mortgage loans | A- and above | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 2,275.9 | ||
2020 | 1,722.7 | 1,807.6 | |
2019 | 2,412.9 | 2,486.8 | |
2018 | 2,383.3 | 2,464.7 | |
2017 | 1,437.2 | 1,780.8 | |
2016 | 1,417.8 | ||
Prior | 4,334.2 | 3,697 | |
Mortgage loans, Total amortized cost | 14,566.2 | 13,654.7 | |
Commercial mortgage loans | BBB+ thru BBB- | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 278.6 | ||
2020 | 305.6 | 149.1 | |
2019 | 294 | 194.1 | |
2018 | 131.4 | 352.5 | |
2017 | 302.1 | 262.7 | |
2016 | 75.8 | ||
Prior | 380 | 499.7 | |
Mortgage loans, Total amortized cost | 1,691.7 | 1,533.9 | |
Commercial mortgage loans | BB+ thru BB- | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 32.8 | ||
2020 | 5.3 | 23.7 | |
2019 | 69 | ||
2016 | 9.1 | ||
Prior | 55.4 | 43.9 | |
Mortgage loans, Total amortized cost | 93.5 | 145.7 | |
Commercial mortgage loans | B+ and below | |||
Financing Receivable, Credit Quality Indicator | |||
2020 | 39.4 | ||
2019 | 20 | ||
2018 | 8.8 | ||
2017 | 5.8 | ||
2016 | 6.6 | ||
Prior | 34.5 | 35.5 | |
Mortgage loans, Total amortized cost | 43.3 | 107.3 | |
Direct financing leases | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 94.2 | ||
2020 | 113.1 | 209.7 | |
2019 | 25.3 | 29.6 | |
2018 | 57.3 | 65.8 | |
2017 | 32.1 | 37.6 | |
2016 | 19.3 | ||
Prior | 287.9 | 348.8 | |
Mortgage loans, Total amortized cost | 609.9 | 710.8 | |
Accrued interest receivable | 1.2 | 0.5 | |
Direct financing leases | A- and above | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 11.7 | ||
2020 | 41.8 | 43.9 | |
2019 | 1.4 | 1.6 | |
2018 | 39.4 | 42.6 | |
2017 | 16.6 | 19.2 | |
2016 | 15.3 | ||
Prior | 235.6 | 202.9 | |
Mortgage loans, Total amortized cost | 346.5 | 325.5 | |
Direct financing leases | BBB+ thru BBB- | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 30.2 | ||
2020 | 57.9 | 94.9 | |
2019 | 22 | 5.5 | |
2018 | 17.9 | 11.3 | |
2017 | 15.5 | 18.4 | |
2016 | 3 | ||
Prior | 50.2 | 35.5 | |
Mortgage loans, Total amortized cost | 193.7 | 168.6 | |
Direct financing leases | BB+ thru BB- | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 50.8 | ||
2020 | 13.4 | 13.3 | |
2019 | 1.9 | ||
Prior | 2.1 | 1.9 | |
Mortgage loans, Total amortized cost | 68.2 | 15.2 | |
Direct financing leases | B+ and below | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 1.5 | ||
2020 | 57.6 | ||
2019 | 22.5 | ||
2018 | 11.9 | ||
2016 | 1 | ||
Prior | 108.5 | ||
Mortgage loans, Total amortized cost | 1.5 | 201.5 | |
Residential mortgage loans | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 2,039.1 | ||
2020 | 511.9 | 699.1 | |
2019 | 156.2 | 338.7 | |
2018 | 91.2 | 167.8 | |
2017 | 103.2 | 166.5 | |
2016 | 168 | ||
Prior | 418.3 | 411.4 | |
Mortgage loans, Total amortized cost | 3,319.9 | 1,951.5 | $ 1,496.7 |
Accrued interest receivable | 16.7 | 2 | |
Residential mortgage loans | Performing | |||
Financing Receivable, Credit Quality Indicator | |||
2021 | 2,039.1 | ||
2020 | 510.1 | 699.1 | |
2019 | 155.6 | 336.7 | |
2018 | 91.2 | 167 | |
2017 | 102.4 | 165.1 | |
2016 | 167.6 | ||
Prior | 415.6 | 398.7 | |
Mortgage loans, Total amortized cost | 3,314 | 1,934.2 | |
Residential mortgage loans | Non-performing | |||
Financing Receivable, Credit Quality Indicator | |||
2020 | 1.8 | ||
2019 | 0.6 | 2 | |
2018 | 0.8 | ||
2017 | 0.8 | 1.4 | |
2016 | 0.4 | ||
Prior | 2.7 | 12.7 | |
Mortgage loans, Total amortized cost | $ 5.9 | $ 17.3 | |
Mortgage loans, Days delinquent to be considered non-performing | 90 days |
Investments - Financing Receiva
Investments - Financing Receivable, Non-Accrual and Aging (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Non-accrual status | $ 17.2 | $ 21.5 | $ 11.8 |
Financing receivables, Non-accrual assets without a valuation allowance | 0.7 | 0.7 | |
Financing receivables, Nonaccrual, Interest Income | 0.5 | 0 | |
Financing receivables, Total amortized cost | 20,324.5 | 18,103.9 | 16,513.9 |
Recorded investment 90 days or more past due and accruing | 5.3 | 7.8 | |
Reinsurance recoverables | 1,189.3 | 1,098 | |
Current | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 20,240.1 | 17,951.1 | |
Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 84.4 | 152.8 | |
Reinsurance recoverables | 0 | 0 | |
30 to 59 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 59.9 | 108.7 | |
60 to 89 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 11.5 | 21.2 | |
90 Days or More Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 13 | 22.9 | |
Commercial mortgage loans | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Non-accrual status | 13.2 | 10.7 | 5 |
Financing receivables, Total amortized cost | 16,394.7 | 15,441.6 | 15,017.2 |
Recorded investment 90 days or more past due and accruing | 2.7 | 1.3 | |
Commercial mortgage loans | Current | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 16,386.9 | 15,378.3 | |
Commercial mortgage loans | Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 7.8 | 63.3 | |
Commercial mortgage loans | 30 to 59 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 0.7 | 42.1 | |
Commercial mortgage loans | 60 to 89 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 9.2 | ||
Commercial mortgage loans | 90 Days or More Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 7.1 | 12 | |
Direct financing leases | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 609.9 | 710.8 | |
Recorded investment 90 days or more past due and accruing | 0.7 | ||
Direct financing leases | Current | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 607.3 | 707.6 | |
Direct financing leases | Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 2.6 | 3.2 | |
Direct financing leases | 60 to 89 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 1.9 | 3.2 | |
Direct financing leases | 90 Days or More Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 0.7 | ||
Residential mortgage loans | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Non-accrual status | 4 | 10.8 | 6.8 |
Financing receivables, Non-accrual assets without a valuation allowance | 0.7 | 0.7 | |
Financing receivables, Total amortized cost | 3,319.9 | 1,951.5 | $ 1,496.7 |
Recorded investment 90 days or more past due and accruing | 1.9 | 6.5 | |
Residential mortgage loans | Current | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 3,245.9 | 1,865.2 | |
Residential mortgage loans | Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 74 | 86.3 | |
Residential mortgage loans | 30 to 59 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 59.2 | 66.6 | |
Residential mortgage loans | 60 to 89 Days Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | 9.6 | 8.8 | |
Residential mortgage loans | 90 Days or More Past Due | |||
Financing receivables, non-accrual and aging disclosures | |||
Financing receivables, Total amortized cost | $ 5.2 | $ 10.9 |
Investments - Mortgage Loan Val
Investments - Mortgage Loan Valuation Allowance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Changes in financing receivable valuation allowance | |||
Beginning balance, Financing receivable valuation allowance | $ 52.9 | $ 33.1 | $ 27.4 |
Provision: Financing receivable valuation allowance | (6.6) | 17.3 | (3) |
Charge-offs: Financing receivable valuation allowance | (0.5) | (0.9) | (0.6) |
Recoveries: Financing receivable valuation allowance | 3.6 | 2.8 | 3.2 |
Effect of exchange rates: Financing receivable valuation allowance | (0.4) | 0.6 | |
Ending balance, Financing receivable valuation allowance | 49 | 52.9 | 27 |
Individually evaluated for impairment, Financing receivable valuation allowance | 1.4 | ||
Collectively evaluated for impairment, Financing receivable valuation allowance | 25.6 | ||
Individually evaluated for impairment, Financing receivable | 11.4 | ||
Collectively evaluated for impairment, Financing receivable | 16,502.5 | ||
Financing receivables, Total amortized cost | $ 20,324.5 | 18,103.9 | 16,513.9 |
Commercial mortgage loans | |||
Financing receivable valuation allowance disclosures | |||
Mortgage loans, Days delinquent to be analyzed for valuation allowance | 60 days | ||
Changes in financing receivable valuation allowance | |||
Beginning balance, Financing receivable valuation allowance | $ 43.2 | 27.3 | 24.3 |
Provision: Financing receivable valuation allowance | 1 | 15.5 | 0.2 |
Effect of exchange rates: Financing receivable valuation allowance | (0.3) | 0.4 | |
Ending balance, Financing receivable valuation allowance | 43.9 | 43.2 | 24.5 |
Collectively evaluated for impairment, Financing receivable valuation allowance | 24.5 | ||
Collectively evaluated for impairment, Financing receivable | 15,017.2 | ||
Financing receivables, Total amortized cost | 16,394.7 | 15,441.6 | 15,017.2 |
Direct financing leases | |||
Changes in financing receivable valuation allowance | |||
Beginning balance, Financing receivable valuation allowance | 0.1 | ||
Provision: Financing receivable valuation allowance | 0.4 | 0.1 | |
Effect of exchange rates: Financing receivable valuation allowance | (0.1) | ||
Ending balance, Financing receivable valuation allowance | 0.4 | 0.1 | |
Financing receivables, Total amortized cost | $ 609.9 | 710.8 | |
Residential mortgage loans | |||
Financing receivable valuation allowance disclosures | |||
Mortgage loans, Days delinquent to be analyzed for valuation allowance | 60 days | ||
Changes in financing receivable valuation allowance | |||
Beginning balance, Financing receivable valuation allowance | $ 6.9 | 3.3 | 3.1 |
Provision: Financing receivable valuation allowance | (8) | 1.5 | (3.2) |
Charge-offs: Financing receivable valuation allowance | (0.5) | (0.9) | (0.6) |
Recoveries: Financing receivable valuation allowance | 3.6 | 2.8 | 3.2 |
Effect of exchange rates: Financing receivable valuation allowance | 0.2 | ||
Ending balance, Financing receivable valuation allowance | 2 | 6.9 | 2.5 |
Individually evaluated for impairment, Financing receivable valuation allowance | 1.4 | ||
Collectively evaluated for impairment, Financing receivable valuation allowance | 1.1 | ||
Individually evaluated for impairment, Financing receivable | 11.4 | ||
Collectively evaluated for impairment, Financing receivable | 1,485.3 | ||
Financing receivables, Total amortized cost | 3,319.9 | 1,951.5 | $ 1,496.7 |
Reinsurance recoverables | |||
Changes in financing receivable valuation allowance | |||
Beginning balance, Financing receivable valuation allowance | 2.7 | 2.5 | |
Provision: Financing receivable valuation allowance | 0.2 | ||
Ending balance, Financing receivable valuation allowance | $ 2.7 | $ 2.7 |
Investments - Mortgage Loans (D
Investments - Mortgage Loans (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 20,324.5 | $ 18,103.9 | $ 16,513.9 |
Commercial mortgage loans | |||
Mortgage loan disclosures | |||
Mortgage loans, purchased | 118.2 | 166.8 | 200.5 |
Mortgage loans, sold | 73.8 | 7.6 | 1.6 |
Mortgage loans, Total amortized cost | $ 16,394.7 | $ 15,441.6 | 15,017.2 |
Percent of mortgage loans (as a percent) | 100.00% | 100.00% | |
Commercial mortgage loans | Office | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 4,789.8 | $ 4,491.7 | |
Percent of mortgage loans (as a percent) | 29.30% | 29.00% | |
Commercial mortgage loans | Retail | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 1,622.1 | $ 1,815.3 | |
Percent of mortgage loans (as a percent) | 9.90% | 11.80% | |
Commercial mortgage loans | Industrial | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 2,966.4 | $ 2,488.7 | |
Percent of mortgage loans (as a percent) | 18.10% | 16.10% | |
Commercial mortgage loans | Apartments | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 6,234.3 | $ 5,958 | |
Percent of mortgage loans (as a percent) | 38.00% | 38.60% | |
Commercial mortgage loans | Hotel | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 85.7 | $ 89.4 | |
Percent of mortgage loans (as a percent) | 0.50% | 0.60% | |
Commercial mortgage loans | Mixed use/other | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 696.4 | $ 598.5 | |
Percent of mortgage loans (as a percent) | 4.20% | 3.90% | |
Commercial mortgage loans | New England | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 585.6 | $ 593.9 | |
Percent of mortgage loans (as a percent) | 3.60% | 3.80% | |
Commercial mortgage loans | Middle Atlantic | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 4,536.5 | $ 4,438.2 | |
Percent of mortgage loans (as a percent) | 27.70% | 28.80% | |
Commercial mortgage loans | East North Central | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 623.9 | $ 572.6 | |
Percent of mortgage loans (as a percent) | 3.80% | 3.70% | |
Commercial mortgage loans | West North Central | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 338.6 | $ 267.5 | |
Percent of mortgage loans (as a percent) | 2.10% | 1.70% | |
Commercial mortgage loans | South Atlantic | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 2,464.9 | $ 2,368.9 | |
Percent of mortgage loans (as a percent) | 15.00% | 15.30% | |
Commercial mortgage loans | East South Central | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 378.9 | $ 316.6 | |
Percent of mortgage loans (as a percent) | 2.30% | 2.10% | |
Commercial mortgage loans | West South Central | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 1,243.7 | $ 1,315.9 | |
Percent of mortgage loans (as a percent) | 7.60% | 8.50% | |
Commercial mortgage loans | Mountain | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 925.6 | $ 936.2 | |
Percent of mortgage loans (as a percent) | 5.60% | 6.10% | |
Commercial mortgage loans | Pacific | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 4,864.4 | $ 4,183 | |
Percent of mortgage loans (as a percent) | 29.70% | 27.10% | |
Commercial mortgage loans | International | |||
Mortgage loan disclosures | |||
Mortgage loans, Total amortized cost | $ 432.6 | $ 448.8 | |
Percent of mortgage loans (as a percent) | 2.60% | 2.90% | |
Residential mortgage loans | |||
Mortgage loan disclosures | |||
Mortgage loans, purchased | $ 2,370.9 | $ 1,151.1 | 489.2 |
Mortgage loans, sold | 88.9 | 117.4 | 70.7 |
Mortgage loans, Total amortized cost | $ 3,319.9 | $ 1,951.5 | $ 1,496.7 |
Investments - Real Estate (Deta
Investments - Real Estate (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Real estate | |||
Depreciation expense on invested real estate | $ 67.4 | $ 65.3 | $ 60 |
Accumulated depreciation on invested real estate | $ 652 | $ 591.2 |
Investments - Other Investments
Investments - Other Investments (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Summarized financial information of unconsolidated entities | ||||
Total assets | $ 304,657.2 | $ 296,627.7 | ||
Total liabilities | 288,198.9 | 279,754.8 | ||
Total stockholders' equity | 16,125.8 | 16,617.3 | $ 14,685.8 | $ 11,456 |
Total revenues | 14,262.7 | 14,741.7 | 16,222.1 | |
Net income (loss) | 1,757.4 | 1,428.5 | 1,444.1 | |
Other Types of Investments | ||||
Cash surrender value of company owned life insurance | 1,032.1 | 973.6 | ||
Certain sponsored investment funds carried at fair value | 801.4 | 638.8 | ||
Unconsolidated entities | ||||
Summarized financial information of unconsolidated entities | ||||
Total assets | 177,429 | 155,724.1 | ||
Total liabilities | 72,001.3 | 73,438.2 | ||
Total stockholders' equity | 105,427.7 | 82,285.9 | ||
Net investment in unconsolidated entities | 2,162.5 | 1,912.9 | ||
Total revenues | 21,769.6 | 14,989 | 17,802.2 | |
Net income (loss) | 15,638.5 | 7,757 | 7,938.3 | |
Our share of net income of unconsolidated entities | $ 383 | $ 143.9 | $ 222.5 |
Investments - Securities Posted
Investments - Securities Posted as Collateral (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Securities Posted as Collateral | ||
Commercial mortgage loans and residential first lien mortgages posted as collateral associated with obligation under funding agreements with the Federal Home Loan Bank of Des Moines | $ 5,195.9 | $ 4,604.9 |
Fixed maturities available-for-sale and trading securities posted as collateral for a reinsurance arrangement, derivative credit support annex (collateral) agreements, Futures Commission Merchant agreements, a lending arrangement and an obligation under funding agreements with Federal Home Loan Bank of Des Moines | 2,589.3 | 2,563.9 |
Securities posted as collateral eligible to be sold or repledged | $ 186 | $ 133.4 |
Investments - Balance Sheet Off
Investments - Balance Sheet Offsetting, Assets (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Financial Asset Offsetting | ||
Gross amount of recognized assets subject to netting agreements | $ 353.5 | $ 527.2 |
Amount of liabilities that offset the gross amount of assets subject to netting agreements not offset in statement of financial position | (100.1) | (132.5) |
Collateral received, financial assets | (246.1) | (357.2) |
Net amount of assets subject to netting agreements | 7.3 | 37.5 |
Derivative assets | ||
Financial Asset Offsetting | ||
Gross amount of recognized assets subject to netting agreements | 337.1 | 463.5 |
Amount of liabilities that offset the gross amount of assets subject to netting agreements not offset in statement of financial position | (100.1) | (132.5) |
Collateral received, financial assets | (229.7) | (293.5) |
Net amount of assets subject to netting agreements | 7.3 | 37.5 |
Reverse repurchase agreements | ||
Financial Asset Offsetting | ||
Gross amount of recognized assets subject to netting agreements | 16.4 | 63.7 |
Collateral received, financial assets | $ (16.4) | $ (63.7) |
Investments - Balance Sheet O_2
Investments - Balance Sheet Offsetting, Liabilities (Details) - Derivative liabilities - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Financial Liability Offsetting | ||
Gross amount of recognized liabilities subject to netting agreements | $ 225.3 | $ 186.2 |
Amount of assets that offset the gross amount of liabilities subject to netting agreements not offset in statement of financial position | (100.1) | (132.5) |
Collateral pledged, financial liabilities | (115.2) | (45.7) |
Net amount of liabilities subject to netting agreements | 10 | 8 |
Gross amount of liabilities not subject to netting agreements | $ 357 | $ 467.8 |
Derivative Financial Instrume_3
Derivative Financial Instruments - Notional Amounts and Credit Exposure (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Derivative Financial Instruments, exposure | ||
Cash and securities posted under collateral arrangements associated with derivative credit support agreements and Futures Commission Merchant agreements | $ 240.8 | $ 148.3 |
Aggregate fair value of all derivative instruments with credit-risk-related contingent features that were in a liability position | 146.3 | 180.2 |
Collateral and initial margin posted supporting derivatives with credit-risk-related contingent features that were in a liability position | 240.8 | 148.3 |
Additional collateral required to be posted if derivative credit-risk-related contingent features were triggered | 48.6 | |
Cash collateral received associated with derivative credit support annex agreements and Futures Commission Merchant agreements | 214.9 | 225.2 |
Notional amount | 69,428.1 | 62,292.5 |
Gross credit exposure | 348.1 | 473.5 |
Less: collateral received | 244.6 | 294.7 |
Net credit exposure | 103.5 | 178.8 |
Interest rate swaps | ||
Derivative Financial Instruments, exposure | ||
Cash exchanged under contract | 0 | |
Principal payments made under contract | 0 | |
Notional amount | 47,927.4 | 44,472.1 |
Gross credit exposure | 205.9 | 291 |
Interest rate options | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 2,373.9 | 2,083.9 |
Gross credit exposure | 24.5 | 51 |
Interest rate forwards | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 2,181.6 | 1,000 |
Gross credit exposure | 15.3 | 6.2 |
Interest rate futures | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 1,774.5 | 188.5 |
Swaptions | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 62 | |
Currency swaps | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 1,242.7 | 1,045.5 |
Gross credit exposure | 51.1 | 43.3 |
Currency forwards | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 1,043.6 | 1,115.8 |
Gross credit exposure | 11.3 | 45.4 |
Equity options | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 2,378.2 | 1,857.8 |
Gross credit exposure | 37.3 | 33.2 |
Equity futures | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 150.4 | 218.1 |
Credit default swaps | ||
Derivative Financial Instruments, exposure | ||
Notional amount | 295 | 295 |
Gross credit exposure | 2.7 | 3.4 |
Embedded derivative financial instruments | ||
Derivative Financial Instruments, exposure | ||
Notional amount | $ 10,060.8 | $ 9,953.8 |
Derivative Financial Instrume_4
Derivative Financial Instruments - Fair Value of Derivatives (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Derivatives, fair value disclosures | ||
Derivative instruments, assets | $ 337.1 | $ 463.5 |
Derivative instruments, liabilities | 582.3 | 654 |
Fair value of embedded derivative liabilities reported with contractholder funds | 356.3 | 467.8 |
Derivatives designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 52.5 | 21.1 |
Derivative instruments, liabilities | 36.6 | 72.5 |
Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 284.6 | 442.4 |
Derivative instruments, liabilities | 545.7 | 581.5 |
Interest rate contracts | Derivatives designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 4.1 | |
Derivative instruments, liabilities | 19 | 27.8 |
Interest rate contracts | Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 233.4 | 339.3 |
Derivative instruments, liabilities | 13 | 33 |
Foreign exchange contracts | Derivatives designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 48.4 | 21.1 |
Derivative instruments, liabilities | 17.6 | 44.7 |
Foreign exchange contracts | Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 11.3 | 66.5 |
Derivative instruments, liabilities | 83.3 | 29.2 |
Equity contracts | Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 37.3 | 33.2 |
Derivative instruments, liabilities | 90.9 | 49 |
Credit contracts | Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, assets | 2.6 | 3.4 |
Derivative instruments, liabilities | 2.2 | 2.5 |
Other contracts | Derivatives not designated as hedging instruments | ||
Derivatives, fair value disclosures | ||
Derivative instruments, liabilities | $ 356.3 | $ 467.8 |
Derivative Financial Instrume_5
Derivative Financial Instruments - Credit Derivatives Sold (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Credit default swaps | ||
Credit derivatives sold disclosures | ||
Notional amount | $ 150 | $ 170 |
Fair value | 2.6 | 3.3 |
Maximum future payments | $ 150 | $ 170 |
Weighted average expected life | 3 years 1 month 6 days | 3 years 9 months 18 days |
Single name credit default swaps | Corporate debt securities | A | ||
Credit derivatives sold disclosures | ||
Notional amount | $ 20 | $ 20 |
Fair value | 0.4 | 0.5 |
Maximum future payments | $ 20 | $ 20 |
Weighted average expected life | 3 years 6 months | 4 years 6 months |
Single name credit default swaps | Corporate debt securities | BBB | ||
Credit derivatives sold disclosures | ||
Notional amount | $ 110 | $ 115 |
Fair value | 1.7 | 2.1 |
Maximum future payments | $ 110 | $ 115 |
Weighted average expected life | 3 years | 3 years 10 months 24 days |
Single name credit default swaps | Sovereign | A | ||
Credit derivatives sold disclosures | ||
Notional amount | $ 20 | $ 20 |
Fair value | 0.5 | 0.6 |
Maximum future payments | $ 20 | $ 20 |
Weighted average expected life | 3 years 6 months | 4 years 6 months |
Single name credit default swaps | Sovereign | BBB | ||
Credit derivatives sold disclosures | ||
Notional amount | $ 15 | |
Fair value | 0.1 | |
Maximum future payments | $ 15 | |
Weighted average expected life | 1 year |
Derivative Financial Instrume_6
Derivative Financial Instruments - Fair Value Hedges (Details) - Fixed maturities, available-for-sale - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Fair Value Hedges | ||
Amortized cost of hedged item - Active hedging relationships | $ 1,859.9 | $ 476.1 |
Amortized cost of hedged item - Discontinued hedging relationships | 79.7 | 135.1 |
Amortized cost of hedged item - Active or discontinued hedging relationships | 1,939.6 | 611.2 |
Cumulative amount of fair value hedging basis adjustment - Active hedging relationships | (7.1) | 21.4 |
Cumulative amount of fair value hedging basis adjustment - Discontinued hedging relationships | 2.8 | 5.2 |
Cumulative amount of fair value hedging basis adjustment - Active or discontinued hedging relationships | (4.3) | 26.6 |
Amortized cost basis of closed portfolio used in last-of-layer hedging relationship | 1,390.4 | 0 |
Cumulative basis adjustments associated with last-of-layer hedging relationship | (3.9) | 0 |
Amount of hedged item in last-of-layer hedging relationship | $ 510 | $ 0 |
Derivative Financial Instrume_7
Derivative Financial Instruments - Cash Flow Hedges (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Cash Flow Hedges | |||
Amount of gain (loss) recognized in AOCI on derivatives in cash flow hedging relationships | $ 57.5 | $ (40.1) | $ (19.3) |
Net gains (losses) expected to be reclassified from accumulated OCI into net income in the next 12 months | 21.7 | ||
Interest rate contracts | Fixed maturities, available-for-sale | |||
Cash Flow Hedges | |||
Amount of gain (loss) recognized in AOCI on derivatives in cash flow hedging relationships | (3) | (9.9) | |
Interest rate contracts | Investment contracts | |||
Cash Flow Hedges | |||
Amount of gain (loss) recognized in AOCI on derivatives in cash flow hedging relationships | 4.1 | ||
Foreign exchange contracts | Fixed maturities, available-for-sale | |||
Cash Flow Hedges | |||
Amount of gain (loss) recognized in AOCI on derivatives in cash flow hedging relationships | $ 53.4 | $ (37.1) | $ (9.4) |
Derivative Financial Instrume_8
Derivative Financial Instruments - Effect of Hedges on Consolidated Statements of Operations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Gains (losses) recognized for hedging relationships | |||
Net investment income (loss) | $ 4,406.1 | $ 3,890.6 | $ 3,998.4 |
Net realized capital gains (losses) | 2.5 | 302.6 | (52.8) |
Benefits, claims and settlement expenses | 7,097 | 8,281.5 | 9,905.8 |
Operating expenses | 4,987.3 | 4,646.5 | 4,503.9 |
Fair Value Hedges | Interest rate contracts | Net investment income | |||
Gains (losses) recognized for hedging relationships | |||
Gain (loss) recognized on hedged item | (28.7) | 3.3 | 5.7 |
Gain (loss) recognized on derivatives | 28.6 | (3.8) | (6) |
Amortization of hedged item basis adjustments | (1.8) | (2.5) | (4.2) |
Amounts related to periodic settlements on derivatives | (10) | (6.2) | (3.4) |
Total gain (loss) recognized for hedging relationships | (11.9) | (9.2) | (7.9) |
Cash Flow Hedges | Net investment income | |||
Gains (losses) recognized for hedging relationships | |||
Total gain (loss) recognized for hedging relationships | 25 | 26.3 | 27.2 |
Cash Flow Hedges | Net realized capital gains (losses) | |||
Gains (losses) recognized for hedging relationships | |||
Total gain (loss) recognized for hedging relationships | 10.2 | 9.1 | 9 |
Cash Flow Hedges | Benefits, claims and settlement expenses | |||
Gains (losses) recognized for hedging relationships | |||
Total gain (loss) recognized for hedging relationships | (0.5) | (0.1) | (0.1) |
Cash Flow Hedges | Operating expense | |||
Gains (losses) recognized for hedging relationships | |||
Total gain (loss) recognized for hedging relationships | (4.8) | ||
Cash Flow Hedges | Interest rate contracts | Gain (loss) reclassified from AOCI on derivatives | |||
Gains (losses) recognized for hedging relationships | |||
Net investment income (loss) | 15.4 | 18.1 | 19.8 |
Net realized capital gains (losses) | 2.7 | (0.6) | |
Benefits, claims and settlement expenses | 0.1 | 0.1 | 0.1 |
Operating expenses | 4.8 | ||
Cash Flow Hedges | Interest rate contracts | Net realized capital gains (losses) | |||
Gains (losses) recognized for hedging relationships | |||
Gain (loss) reclassified from AOCI into net income as a result that a forecasted transaction is no longer probable of occurring | 1 | 0.1 | 0.1 |
Cash Flow Hedges | Interest rate contracts | Benefits, claims and settlement expenses | |||
Gains (losses) recognized for hedging relationships | |||
Amounts related to periodic settlements on derivatives | (0.4) | ||
Cash Flow Hedges | Foreign exchange contracts | Gain (loss) reclassified from AOCI on derivatives | |||
Gains (losses) recognized for hedging relationships | |||
Net realized capital gains (losses) | 9.2 | 6.3 | 9.5 |
Cash Flow Hedges | Foreign exchange contracts | Net investment income | |||
Gains (losses) recognized for hedging relationships | |||
Amounts related to periodic settlements on derivatives | 9.6 | 8.2 | $ 7.4 |
Net investment hedging relationships | |||
Gains (losses) recognized for hedging relationships | |||
Amount of gain (loss) recognized in accumulated OCI on derivatives | 2.9 | 7.9 | |
Net investment hedging relationships | Gain (loss) reclassified from AOCI on derivatives | |||
Gains (losses) recognized for hedging relationships | |||
Net realized capital gains (losses) | (7.1) | ||
Net investment hedging relationships | Foreign exchange contracts | |||
Gains (losses) recognized for hedging relationships | |||
Amount of gain (loss) recognized in accumulated OCI on derivatives | $ 2.9 | 7.9 | |
Net investment hedging relationships | Foreign exchange contracts | Gain (loss) reclassified from AOCI on derivatives | |||
Gains (losses) recognized for hedging relationships | |||
Net realized capital gains (losses) | $ (7.1) |
Derivative Financial Instrume_9
Derivative Financial Instruments - Derivatives Not Designated as Hedging Instruments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | $ (146.2) | $ 50.9 | $ (145.2) |
Interest rate contracts | |||
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | (46.6) | 346.5 | 218 |
Foreign exchange contracts | |||
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | (121.9) | 54.7 | (58.6) |
Equity contracts | |||
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | (81.5) | (96.6) | (132.9) |
Credit contracts | |||
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | 0.1 | 1.8 | (3.6) |
Other contracts | |||
Effect of derivatives not designated as hedging instruments on the consolidated statements of operations | |||
Amount of gain (loss) recognized in net income on derivatives | $ 103.7 | $ (255.5) | $ (168.1) |
Closed Block - Assets and Liabi
Closed Block - Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Closed Block liabilities and assets designated to the Closed Block | ||||
Closed Block liabilities: Policyholder dividends obligation | $ 210.7 | $ 298.2 | ||
Closed Block liabilities | ||||
Closed Block liabilities: Future policy benefits and claims | 3,286 | 3,423.2 | ||
Closed Block liabilities: Other policyholder funds | 5.3 | 6 | ||
Closed Block liabilities: Policyholder dividends payable | 176.6 | 189 | ||
Closed Block liabilities: Policyholder dividends obligation | 210.7 | 298.2 | ||
Closed Block liabilities: Other liabilities | 8.8 | 8.7 | ||
Total Closed Block liabilities | 3,687.4 | 3,925.1 | ||
Assets designated to the Closed Block | ||||
Closed Block assets: Fixed maturities, available-for-sale | 2,191.6 | 2,353.3 | ||
Closed Block assets: Fixed maturities, trading | 2.4 | 2.6 | ||
Closed Block assets: Equity securities | 1 | 1.1 | ||
Closed Block assets: Mortgage loans | 554.9 | 565.9 | ||
Closed Block assets: Policy loans | 425.2 | 456.8 | ||
Closed Block assets: Other investments | 48.4 | 61.7 | ||
Closed Block assets: Total investments | 3,223.5 | 3,441.4 | ||
Closed Block assets: Cash and cash equivalents | 19.7 | 23.2 | ||
Closed Block assets: Accrued investment income | 32.6 | 35.4 | ||
Closed Block assets: Premiums due and other receivables | 8.4 | 8.3 | ||
Closed Block assets: Deferred tax asset | 24.6 | 24.2 | ||
Total assets designated to the Closed Block | 3,308.8 | 3,532.5 | ||
Excess of Closed Block liabilities over assets designated to the Closed Block | 378.6 | 392.6 | ||
Amounts included in accumulated other comprehensive income (loss) | 0.6 | 0.9 | ||
Maximum future earnings to be recognized from Closed Block assets and liabilities | $ 379.2 | $ 393.5 | $ 426.9 | $ 476.8 |
Closed Block - Revenues and Exp
Closed Block - Revenues and Expenses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Closed Block: Premiums and other considerations | $ 196.1 | $ 217.6 | $ 227.6 |
Closed Block: Net investment income (loss) | 137.6 | 143.6 | 154.4 |
Closed Block: Net realized capital gains (losses) | (4.6) | 16 | 7.4 |
Closed Block: Total revenues | 329.1 | 377.2 | 389.4 |
Expenses | |||
Closed Block: Benefits, claims and settlement expenses | 212 | 212.8 | 204.4 |
Closed Block: Dividends to policyholders | 92.6 | 117.8 | 116.3 |
Closed Block: Operating expenses | 2.3 | 2.7 | 2.9 |
Closed Block: Total expenses | 306.9 | 333.3 | 323.6 |
Closed Block revenues, net of Closed Block expenses, before income taxes | 22.2 | 43.9 | 65.8 |
Closed Block: Income taxes (benefits) | 3.9 | 8.4 | 12.9 |
Closed Block revenues, net of Closed Block expenses and income taxes | 18.3 | 35.5 | 52.9 |
Funding adjustment charges | (4) | (2.2) | (3) |
Closed Block revenues, net of Closed Block expenses, income taxes and funding adjustments | $ 14.3 | $ 33.3 | $ 49.9 |
Closed Block - Change in Maximu
Closed Block - Change in Maximum Future Earnings (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Change in maximum future earnings of the Closed Block | |||
Maximum future earnings to be recognized from Closed Block assets and liabilities, Beginning of year | $ 393.5 | $ 426.9 | $ 476.8 |
Effects of implementation of accounting changes | 0.1 | ||
Maximum future earnings to be recognized from Closed Block assets and liabilities, End of year | 379.2 | 393.5 | 426.9 |
Closed Block revenues, net of Closed Block expenses, income taxes and funding adjustment charges | $ (14.3) | $ (33.3) | $ (49.9) |
Deferred Acquisition Costs (Det
Deferred Acquisition Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Change in deferred acquisition costs | |||
Balance at beginning of year, deferred acquisition costs | $ 3,409.7 | $ 3,521.3 | $ 3,693.5 |
Costs deferred during the year | 461.4 | 457 | 473.5 |
Amortization of deferred acquisition costs | (285.4) | (388.1) | (347) |
Adjustment related to unrealized (gains) losses on available-for-sale securities and derivative instruments | 171.8 | (180.5) | (298.7) |
Balance at end of year, deferred acquisition costs | $ 3,757.5 | $ 3,409.7 | $ 3,521.3 |
Insurance Liabilities - Compone
Insurance Liabilities - Components of Contractholder Funds (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Liabilities for investment contracts: | ||
Liabilities for individual annuities | $ 10,652.3 | $ 12,864.1 |
GICs | 12,206 | 11,858 |
Funding agreements | 11,685.5 | 9,407.3 |
Other investment contracts | 1,593.5 | 1,762.4 |
Total liabilities for investment contracts | 36,137.3 | 35,891.8 |
Universal life and other reserves | 7,460.7 | 7,345.9 |
Contractholder funds | $ 43,598 | $ 43,237.7 |
Insurance Liabilities - Contrac
Insurance Liabilities - Contractholder Funding Agreements (Details) $ in Millions, € in Billions | 12 Months Ended | |||||||||
Dec. 31, 2021USD ($)item | Feb. 28, 2021USD ($) | Dec. 31, 2020USD ($) | Nov. 30, 2017USD ($) | Jun. 30, 2015USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2006USD ($) | Dec. 31, 2006EUR (€) | Dec. 31, 2001USD ($) | Dec. 31, 1998USD ($) | |
Funding agreement disclosures | ||||||||||
Funding agreements | $ 11,685.5 | $ 9,407.3 | ||||||||
Principal Life Insurance Company | ||||||||||
Funding agreement disclosures | ||||||||||
Number of separate funding agreement programs | item | 5 | |||||||||
Principal Life Insurance Company | FHLB Des Moines funding agreement program | ||||||||||
Funding agreement disclosures | ||||||||||
Funding agreements | $ 4,252.4 | 4,252.5 | ||||||||
Principal Life Insurance Company | 1998 Funding agreement program | ||||||||||
Funding agreement disclosures | ||||||||||
Maximum authorized amount of funding agreements to be issued | $ 4,000 | |||||||||
Funding agreements | 75 | 75 | ||||||||
Principal Life Insurance Company | 2006 Funding agreement program | ||||||||||
Funding agreement disclosures | ||||||||||
Maximum authorized amount of funding agreements to be issued | $ 5,300 | € 4 | ||||||||
Funding agreements | 0 | 122.4 | ||||||||
Principal Life Insurance Company | 2001 Funding agreement program | ||||||||||
Funding agreement disclosures | ||||||||||
Maximum authorized amount of funding agreements to be issued | $ 7,000 | |||||||||
Funding agreements | 201.8 | |||||||||
Principal Life Insurance Company | 2011 Funding agreement program | ||||||||||
Funding agreement disclosures | ||||||||||
Maximum authorized amount of funding agreements to be issued | $ 5,000 | |||||||||
Funding agreements | $ 7,156.3 | $ 4,755.8 | ||||||||
Additional maximum authorized amount of funding agreements to be issued | $ 4,000 | $ 4,000 | $ 4,000 | |||||||
Amount of funding agreement authorization used at time additional amount authorized | $ 5,000 |
Insurance Liabilities - Liabili
Insurance Liabilities - Liability for Unpaid Claims (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Change in unpaid claims | |||
Balance at beginning of period, unpaid claims | $ 2,534.9 | $ 2,365.5 | $ 2,252.7 |
Balance at beginning of period, reinsurance recoverables for unpaid claims | 436.9 | 403.8 | 404.3 |
Net balance at beginning of period, unpaid claims | 2,098 | 1,961.7 | 1,848.4 |
Incurred: | |||
Incurred: Current year | 1,572.5 | 1,376.8 | 1,361.3 |
Incurred: Prior years | 7.2 | 26.6 | 0.8 |
Total incurred | 1,579.7 | 1,403.4 | 1,362.1 |
Payments: | |||
Payments: Current year | 1,025 | 863.8 | 869.4 |
Payments: Prior years | 435.4 | 403.3 | 379.4 |
Total payments | 1,460.4 | 1,267.1 | 1,248.8 |
Net balance at end of period, unpaid claims | 2,217.3 | 2,098 | 1,961.7 |
Balance at end of period, reinsurance recoverables for unpaid claims | 442.1 | 436.9 | 403.8 |
Balance at end of period, unpaid claims | 2,659.4 | 2,534.9 | 2,365.5 |
Amount not included in the rollforward above: | |||
Claim adjustment expense liabilities | $ 59.5 | $ 57.8 | $ 57.9 |
Insurance Liabilities - Claims
Insurance Liabilities - Claims Development Tables (Details) $ in Millions | Dec. 31, 2021USD ($)claim | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) |
Claims Development | ||||||||||
Total outstanding liabilities for unpaid claims net of reinsurance | $ 1,372.3 | |||||||||
Long-Term Disability/Group Life Waiver | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 2,192.6 | |||||||||
Net cumulative paid claims | 1,215.6 | |||||||||
Liability for unpaid claims net, not separately presented | 242 | |||||||||
Total outstanding liabilities for unpaid claims net of reinsurance | 1,219 | |||||||||
Long-Term Disability/Group Life Waiver | Incurral year 2012 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 172.2 | $ 173.1 | $ 171.9 | $ 173.3 | $ 174.8 | $ 181.8 | $ 189.5 | $ 191.1 | $ 200 | $ 217.9 |
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 6,445 | |||||||||
Net cumulative paid claims | $ 136.3 | 131.5 | 126.1 | 120 | 112.9 | 104.6 | 93.7 | 80.8 | 55.1 | $ 13.8 |
Long-Term Disability/Group Life Waiver | Incurral year 2013 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 174.5 | 173.4 | 177.1 | 179.5 | 182.3 | 190.7 | 188.4 | 203.3 | 219.3 | |
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 7,051 | |||||||||
Net cumulative paid claims | $ 134.9 | 129 | 123.2 | 116.4 | 106.4 | 97 | 81.4 | 55 | $ 12.5 | |
Long-Term Disability/Group Life Waiver | Incurral year 2014 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 199.3 | 202 | 201.9 | 206.2 | 218.1 | 214.4 | 231.4 | 242.2 | ||
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 7,603 | |||||||||
Net cumulative paid claims | $ 147.2 | 140.8 | 132.4 | 122.3 | 111.8 | 96.3 | 66 | $ 16.1 | ||
Long-Term Disability/Group Life Waiver | Incurral year 2015 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 211.8 | 210 | 208.2 | 215.3 | 217.2 | 227.2 | 231 | |||
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 7,180 | |||||||||
Net cumulative paid claims | $ 146.5 | 137.1 | 126.8 | 114.6 | 98 | 67 | $ 16.9 | |||
Long-Term Disability/Group Life Waiver | Incurral year 2016 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 218.7 | 214.4 | 219.5 | 219.4 | 228.4 | 229.8 | ||||
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 6,163 | |||||||||
Net cumulative paid claims | $ 147.2 | 136.8 | 124.9 | 105.6 | 70.6 | $ 16.2 | ||||
Long-Term Disability/Group Life Waiver | Incurral year 2017 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 245.2 | 245.8 | 243.1 | 239.7 | 238.4 | |||||
Incurred but not reported claims | $ 0.1 | |||||||||
Cumulative number of reported claims | claim | 6,080 | |||||||||
Net cumulative paid claims | $ 151.7 | 135.9 | 115 | 76.5 | $ 17.8 | |||||
Long-Term Disability/Group Life Waiver | Incurral year 2018 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 239.8 | 239.2 | 245.1 | 239.4 | ||||||
Incurred but not reported claims | $ 5 | |||||||||
Cumulative number of reported claims | claim | 5,763 | |||||||||
Net cumulative paid claims | $ 135.7 | 115.7 | 79.9 | $ 20.1 | ||||||
Long-Term Disability/Group Life Waiver | Incurral year 2019 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 240.4 | 248.4 | 255.2 | |||||||
Incurred but not reported claims | $ 7.5 | |||||||||
Cumulative number of reported claims | claim | 5,917 | |||||||||
Net cumulative paid claims | $ 117.5 | 79.7 | $ 19.2 | |||||||
Long-Term Disability/Group Life Waiver | Incurral year 2020 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 231 | 252.1 | ||||||||
Incurred but not reported claims | $ 3.6 | |||||||||
Cumulative number of reported claims | claim | 5,850 | |||||||||
Net cumulative paid claims | $ 78.8 | 20.6 | ||||||||
Long-Term Disability/Group Life Waiver | Incurral year 2021 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 259.7 | |||||||||
Incurred but not reported claims | $ 97.3 | |||||||||
Cumulative number of reported claims | claim | 3,271 | |||||||||
Net cumulative paid claims | $ 19.8 | |||||||||
Dental/Vision/Short-Term Disability/Critical Illness/Accident | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 1,489.7 | |||||||||
Net cumulative paid claims | 1,416.6 | |||||||||
Total outstanding liabilities for unpaid claims net of reinsurance | 73.1 | |||||||||
Dental/Vision/Short-Term Disability/Critical Illness/Accident | Incurral year 2020 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | $ 663.7 | 679.8 | ||||||||
Cumulative number of reported claims | claim | 3,079,517 | |||||||||
Net cumulative paid claims | $ 663.2 | 609.5 | ||||||||
Dental/Vision/Short-Term Disability/Critical Illness/Accident | Incurral year 2021 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 826 | |||||||||
Incurred but not reported claims | $ 49.2 | |||||||||
Cumulative number of reported claims | claim | 3,564,753 | |||||||||
Net cumulative paid claims | $ 753.4 | |||||||||
Group Life | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 595.8 | |||||||||
Net cumulative paid claims | 520.4 | |||||||||
Liability for unpaid claims net, not separately presented | 4.8 | |||||||||
Total outstanding liabilities for unpaid claims net of reinsurance | 80.2 | |||||||||
Group Life | Incurral year 2020 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 278.2 | 270.6 | ||||||||
Incurred but not reported claims | $ 0.9 | |||||||||
Cumulative number of reported claims | claim | 6,251 | |||||||||
Net cumulative paid claims | $ 276.5 | $ 219.3 | ||||||||
Group Life | Incurral year 2021 | ||||||||||
Claims Development | ||||||||||
Net incurred claims | 317.6 | |||||||||
Incurred but not reported claims | $ 27.3 | |||||||||
Cumulative number of reported claims | claim | 6,274 | |||||||||
Net cumulative paid claims | $ 243.9 |
Insurance Liabilities - Reconci
Insurance Liabilities - Reconciliation of Unpaid Claims to Liability for Unpaid Claims Table (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities for unpaid claims | $ 1,372.3 | |||
Reconciling items | ||||
Reinsurance recoverable on unpaid claims | 46.5 | |||
Impact of discounting | (208) | |||
Liability for unpaid claims - short duration contracts | 1,210.8 | |||
Insurance contracts other than short duration | 1,448.6 | |||
Liability for unpaid claims | 2,659.4 | $ 2,534.9 | $ 2,365.5 | $ 2,252.7 |
Long-Term Disability/Group Life Waiver | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities for unpaid claims | 1,219 | |||
Reconciling items | ||||
Reinsurance recoverable on unpaid claims | 46.5 | |||
Impact of discounting | (208) | (214.5) | ||
Liability for unpaid claims - short duration contracts | 1,057.5 | 1,047.6 | ||
Dental/Vision/Short-Term Disability/Critical Illness/Accident | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities for unpaid claims | 73.1 | |||
Reconciling items | ||||
Liability for unpaid claims - short duration contracts | 73.1 | 70.4 | ||
Group Life | ||||
Short-duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | ||||
Net outstanding liabilities for unpaid claims | 80.2 | |||
Reconciling items | ||||
Liability for unpaid claims - short duration contracts | $ 80.2 | $ 54.1 |
Insurance Liabilities - Claim D
Insurance Liabilities - Claim Duration and Payout Table (Details) | Dec. 31, 2021 |
Long-Term Disability/Group Life Waiver | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 7.90% |
Year 2 | 24.60% |
Year 3 | 15.30% |
Year 4 | 8.30% |
Year 5 | 5.80% |
Year 6 | 5.00% |
Year 7 | 4.20% |
Year 8 | 3.40% |
Year 9 | 3.30% |
Year 10 | 2.70% |
Dental/Vision/Short-Term Disability/Critical Illness/Accident | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 91.80% |
Year 2 | 8.00% |
Group Life | |
Short-duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 80.30% |
Year 2 | 17.70% |
Insurance Liabilities - Discoun
Insurance Liabilities - Discounting Table (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Carrying amount of liabilities for unpaid claims | $ 1,210.8 | ||
Aggregate amount of discount | 208 | ||
Long-Term Disability/Group Life Waiver | |||
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Carrying amount of liabilities for unpaid claims | 1,057.5 | $ 1,047.6 | |
Aggregate amount of discount | 208 | 214.5 | |
Interest accretion | $ 33.8 | $ 33.9 | $ 34.2 |
Long-Term Disability/Group Life Waiver | Minimum | |||
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Discount rate | 2.80% | 2.80% | |
Long-Term Disability/Group Life Waiver | Maximum | |||
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Discount rate | 7.00% | 7.00% | |
Dental/Vision/Short-Term Disability/Critical Illness/Accident | |||
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Carrying amount of liabilities for unpaid claims | $ 73.1 | $ 70.4 | |
Group Life | |||
Short-duration Insurance Contracts, Discounted Liabilities [Line Items] | |||
Carrying amount of liabilities for unpaid claims | $ 80.2 | $ 54.1 |
Debt - Short-Term Debt (Details
Debt - Short-Term Debt (Details) - USD ($) $ in Millions | 24 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Short-Term Debt | ||
Credit facilities | $ 945.6 | $ 986.6 |
Short-term debt | $ 79.8 | $ 84.7 |
Weighted-average interest rates on short-term borrowings (as a percent) | 3.20% | 3.40% |
Credit facility maturing November 2023 | PFG, PFS, Principal Life as co-borrowers | ||
Short-Term Debt | ||
Credit facilities | $ 600 | $ 600 |
Credit facility maturing November 2023 | PFG, PFS, Principal Life and Principal Financial Services V (UK) LTD as co-borrowers | ||
Short-Term Debt | ||
Credit facilities | 200 | 200 |
Unsecured lines of credit | Principal International Chile | ||
Short-Term Debt | ||
Credit facilities | 145.6 | 186.6 |
Short-term debt | $ 79.8 | 84.7 |
Unsecured lines of credit | Maximum | Principal International Chile | ||
Short-Term Debt | ||
Term of credit facility | 1 year | |
Commercial paper | ||
Short-Term Debt | ||
Support provided by back-stop facility for commercial paper program (as a percent) | 100.00% | |
Back-stop facility outstanding balances | $ 0 | $ 0 |
Debt - Components of Long-Term
Debt - Components of Long-Term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Long-Term Debt | ||
Long-term debt principal | $ 4,309.3 | $ 4,311.1 |
Net unamortized discount, premium and debt issuance costs | (29.1) | (31.9) |
Long-term debt carrying amount | $ 4,280.2 | $ 4,279.2 |
3.3% notes payable, due 2022 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.30% | 3.30% |
Long-term debt principal | $ 300 | $ 300 |
Net unamortized discount, premium and debt issuance costs | (0.3) | (0.7) |
Long-term debt carrying amount | $ 299.7 | $ 299.3 |
3.125% notes payable, due 2023 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.125% | 3.125% |
Long-term debt principal | $ 300 | $ 300 |
Net unamortized discount, premium and debt issuance costs | (0.4) | (0.7) |
Long-term debt carrying amount | $ 299.6 | $ 299.3 |
3.4% notes payable, due 2025 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.40% | 3.40% |
Long-term debt principal | $ 400 | $ 400 |
Net unamortized discount, premium and debt issuance costs | (1.7) | (2.2) |
Long-term debt carrying amount | $ 398.3 | $ 397.8 |
3.1% notes payable, due 2026 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.10% | 3.10% |
Long-term debt principal | $ 350 | $ 350 |
Net unamortized discount, premium and debt issuance costs | (1.9) | (2.1) |
Long-term debt carrying amount | $ 348.1 | $ 347.9 |
3.7% notes payable, due 2029 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.70% | 3.70% |
Long-term debt principal | $ 500 | $ 500 |
Net unamortized discount, premium and debt issuance costs | (5) | (5.5) |
Long-term debt carrying amount | $ 495 | $ 494.5 |
2.125% notes payable, due 2030 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 2.125% | 2.125% |
Long-term debt principal | $ 600 | $ 600 |
Net unamortized discount, premium and debt issuance costs | (4.1) | (4.6) |
Long-term debt carrying amount | $ 595.9 | $ 595.4 |
6.05% notes payable, due 2036 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 6.05% | 6.05% |
Long-term debt principal | $ 505.6 | $ 505.6 |
Net unamortized discount, premium and debt issuance costs | (2.3) | (2.5) |
Long-term debt carrying amount | $ 503.3 | $ 503.1 |
4.625% notes payable, due 2042 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.625% | 4.625% |
Long-term debt principal | $ 300 | $ 300 |
Net unamortized discount, premium and debt issuance costs | (3) | (3.1) |
Long-term debt carrying amount | $ 297 | $ 296.9 |
4.35% notes payable, due 2043 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.35% | 4.35% |
Long-term debt principal | $ 300 | $ 300 |
Net unamortized discount, premium and debt issuance costs | (3) | (3.1) |
Long-term debt carrying amount | $ 297 | $ 296.9 |
4.3% notes payable, due 2046 | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.30% | 4.30% |
Long-term debt principal | $ 300 | $ 300 |
Net unamortized discount, premium and debt issuance costs | (3.1) | (3.2) |
Long-term debt carrying amount | 296.9 | 296.8 |
Floating rate notes payable, due 2055 | ||
Long-Term Debt | ||
Long-term debt principal | 400 | 400 |
Net unamortized discount, premium and debt issuance costs | (4.6) | (4.7) |
Long-term debt carrying amount | 395.4 | 395.3 |
Non-recourse mortgages and notes payable | ||
Long-Term Debt | ||
Long-term debt principal | 53.7 | 55.5 |
Net unamortized discount, premium and debt issuance costs | 0.3 | 0.5 |
Long-term debt carrying amount | $ 54 | $ 56 |
Debt - Senior Notes and Junior
Debt - Senior Notes and Junior Subordinated Notes (Details) - USD ($) $ in Millions | May 07, 2015 | Sep. 05, 2012 | Dec. 31, 2016 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Aug. 03, 2020 | Jun. 12, 2020 | May 07, 2019 | Nov. 10, 2016 | Nov. 16, 2012 | Dec. 05, 2006 | Oct. 16, 2006 |
Long-Term Debt | |||||||||||||
Principal repayments of long-term debt | $ 1.8 | $ 65.8 | $ 32.2 | ||||||||||
Maximum | Junior subordinated notes | |||||||||||||
Long-Term Debt | |||||||||||||
Years interest payments on debt can be deferred | 5 years | ||||||||||||
3.1% notes payable, due 2026 and 4.3% notes payable, due 2046 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 650 | ||||||||||||
3.1% notes payable, due 2026 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 3.10% | 3.10% | |||||||||||
3.1% notes payable, due 2026 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 350 | ||||||||||||
Interest rate (as a percent) | 3.10% | ||||||||||||
4.3% notes payable, due 2046 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 4.30% | 4.30% | |||||||||||
4.3% notes payable, due 2046 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 4.30% | ||||||||||||
3.4% notes payable, due 2025 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 3.40% | 3.40% | |||||||||||
3.4% notes payable, due 2025 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 400 | ||||||||||||
Interest rate (as a percent) | 3.40% | ||||||||||||
4.7% notes payable, due 2055 | Junior subordinated notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 400 | ||||||||||||
Interest rate (as a percent) | 4.70% | ||||||||||||
Reference rate for floating rate of debt instrument | 3-month LIBOR | ||||||||||||
Spread added to floating reference interest rate (as a percent) | 3.044% | ||||||||||||
1.85% notes payable, due 2017; 3.125% notes payable, due 2023; and 4.35% notes payable, due 2043 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 900 | ||||||||||||
1.85% notes payable, due 2017 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 1.85% | ||||||||||||
3.125% notes payable, due 2023 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 3.125% | 3.125% | |||||||||||
3.125% notes payable, due 2023 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 3.125% | ||||||||||||
4.35% notes payable, due 2043 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 4.35% | 4.35% | |||||||||||
4.35% notes payable, due 2043 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 4.35% | ||||||||||||
3.3% notes payable, due 2022 and 4.625% notes payable, due 2042 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 600 | ||||||||||||
3.3% notes payable, due 2022 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 3.30% | 3.30% | |||||||||||
3.3% notes payable, due 2022 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 3.30% | ||||||||||||
4.625% notes payable, due 2042 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 4.625% | 4.625% | |||||||||||
4.625% notes payable, due 2042 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 300 | ||||||||||||
Interest rate (as a percent) | 4.625% | ||||||||||||
7.875% notes payable, due 2014 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Principal repayments of long-term debt | $ 400 | ||||||||||||
6.05% notes payable, due 2036 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 6.05% | 6.05% | |||||||||||
6.05% notes payable, due 2036 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Principal repayments of long-term debt | $ 94.4 | ||||||||||||
6.05% notes payable, due 2036, issued in October 2006 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 500 | ||||||||||||
Interest rate (as a percent) | 6.05% | ||||||||||||
6.05% notes payable, due 2036, issued in December 2006 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 100 | ||||||||||||
Interest rate (as a percent) | 6.05% | ||||||||||||
3.7% notes payable, due 2029 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 3.70% | 3.70% | |||||||||||
3.7% notes payable, due 2029 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 500 | ||||||||||||
Interest rate (as a percent) | 3.70% | ||||||||||||
2.125% notes payable, due 2030 | |||||||||||||
Long-Term Debt | |||||||||||||
Interest rate (as a percent) | 2.125% | 2.125% | |||||||||||
2.125% notes payable, due 2030 | Senior notes | |||||||||||||
Long-Term Debt | |||||||||||||
Long-term debt issued | $ 100 | $ 500 | |||||||||||
Interest rate (as a percent) | 2.125% | 2.125% |
Debt - Non-Recourse Mortgages a
Debt - Non-Recourse Mortgages and Notes Payable (Details) - Non-recourse mortgages and notes payable - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Long-Term Debt | ||
Outstanding principal balances per real estate development, low end of range | $ 3.1 | $ 3.1 |
Outstanding principal balances per real estate development, high end of range | 14.4 | 15.1 |
Real estate | $ 198.3 | $ 194.1 |
Minimum | ||
Long-Term Debt | ||
Interest rate (as a percent) | 3.50% | 3.50% |
Maximum | ||
Long-Term Debt | ||
Interest rate (as a percent) | 4.80% | 4.80% |
Debt - Future Maturities of Lon
Debt - Future Maturities of Long-Term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Future maturities of long-term debt | ||
Year 1: Long-term debt maturities | $ 301.8 | |
Year 2: Long-term debt maturities | 324.2 | |
Year 3: Long-term debt maturities | 17.5 | |
Year 4: Long-term debt maturities | 398.7 | |
Year 5: Long-term debt maturities | 354.7 | |
Year 6 and thereafter: Long-term debt maturities | 2,883.3 | |
Long-term debt carrying amount | $ 4,280.2 | $ 4,279.2 |
Debt - Contingent Funding Agree
Debt - Contingent Funding Agreements (Details) $ in Millions | Mar. 08, 2018USD ($)item |
Contingent funding agreements | |
Long-Term Debt | |
Number of contingent funding agreements | item | 2 |
Period failure to make payments to trust can be cured before automatic exercise of put options | 30 days |
Minimum shareholders' equity excluding AOCI and NCI, to avoid automatic exercise of options | $ 4,000 |
10-year contingent funding agreement | 2028 Trust | |
Long-Term Debt | |
Term of contingent funding agreement | 10 years |
Semi-annual put premium (as a percent) | 1.275% |
10-year contingent funding agreement | 2028 Trust | Senior Notes due 2028 | |
Long-Term Debt | |
Amount of notes issuable under option | $ 400 |
Interest rate (as a percent) | 4.111% |
30-year contingent funding agreement | 2048 Trust | |
Long-Term Debt | |
Term of contingent funding agreement | 30 years |
Annual put premium (as a percent) | 1.58% |
30-year contingent funding agreement | 2048 Trust | Senior Notes due 2048 | |
Long-Term Debt | |
Amount of notes issuable under option | $ 350 |
Interest rate (as a percent) | 4.682% |
2028 Trust | |
Long-Term Debt | |
Pre-capitalized trust securities sold | $ 400 |
2048 Trust | |
Long-Term Debt | |
Pre-capitalized trust securities sold | $ 350 |
Income Taxes - Income Tax Expen
Income Taxes - Income Tax Expense and Income Before Income Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Income Taxes | |||
Current income taxes (benefits): U.S. federal | $ 110.3 | $ 15.8 | $ 31.9 |
Current income taxes (benefits): State | 19.4 | 5 | 18.1 |
Current income taxes (benefits): Foreign | 38.3 | 55.4 | 45.6 |
Current income taxes (benefits): Tax benefit of operating loss carryforwards | (1.2) | (3.3) | (3) |
Total current income taxes (benefits) | 166.8 | 72.9 | 92.6 |
Deferred income taxes (benefits): U.S. federal | 154.6 | 143.6 | 108.6 |
Deferred income taxes (benefits): State | 16.6 | 11.5 | 6.9 |
Deferred income taxes (benefits): Foreign | (11.8) | 37 | 41.1 |
Total deferred income taxes (benefits) | 159.4 | 192.1 | 156.6 |
Income taxes (benefits) | 326.2 | 265 | 249.2 |
Income (loss) before income taxes | |||
Income (loss) before income taxes - domestic | 1,889.1 | 1,323.2 | 1,351.9 |
Income (loss) before income taxes - foreign | 194.5 | 370.3 | 341.4 |
Income before income taxes | $ 2,083.6 | $ 1,693.5 | $ 1,693.3 |
Income Taxes - Effective Income
Income Taxes - Effective Income Tax Rate (Details) | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation between the U.S. corporate income tax rate and the effective income tax rate from continuing operations | |||
U.S. corporate income tax rate (as a percent) | 21.00% | 21.00% | 21.00% |
Dividends received deduction (as a percent) | (4.00%) | (4.00%) | (5.00%) |
Tax credits (as a percent) | (2.00%) | (3.00%) | (3.00%) |
Impact of equity method presentation (as a percent) | (1.00%) | (1.00%) | (2.00%) |
State income taxes (as a percent) | 1.00% | 1.00% | 1.00% |
Local country permanent tax adjustments (as a percent) | 1.00% | ||
Other income tax rate impacts (as a percent) | 1.00% | 2.00% | 2.00% |
Effective income tax rate (as a percent) | 16.00% | 16.00% | 15.00% |
Income Taxes - Unrecognized Tax
Income Taxes - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Changes in Unrecognized Tax Benefits | |||
Beginning balance, Unrecognized tax benefits | $ 46.9 | $ 61.6 | $ 42.1 |
Additions based on tax positions related to the current year | 1.8 | 1.3 | 0.1 |
Additions for tax positions of prior years | 17.4 | 23.1 | |
Reductions for tax positions related to the current year | (3.2) | (3.2) | (3.2) |
Reductions for tax positions of prior years | (0.5) | ||
Settlements | (14.5) | ||
Expired statute of limitations | (15.7) | ||
Ending balance, Unrecognized tax benefits | 45.5 | 46.9 | 61.6 |
Amount of unrecognized tax benefits that would reduce the effective income tax rate, if recognized | 1.6 | ||
Accumulated pre-tax interest and penalties related to unrecognized tax benefits | $ 1.2 | $ 1.1 | $ 0.9 |
Income Taxes - Deferred Income
Income Taxes - Deferred Income Taxes and Other (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2021 | Dec. 31, 2020 | |
Deferred income tax assets: | |||
Insurance liabilities | $ 552.4 | ||
Net operating and capital loss carryforwards | $ 68.2 | 69.2 | |
Tax credit carryforwards | 4.6 | ||
Employee benefits | 377.9 | 389.1 | |
Other deferred income tax assets | 62.2 | ||
Gross deferred income tax assets | 446.1 | 1,077.5 | |
Valuation allowance | (28) | (18.4) | |
Total deferred income tax assets | 418.1 | 1,059.1 | |
Deferred income tax liabilities: | |||
Deferred income tax liabilities: Deferred acquisition costs | (582.3) | (522.6) | |
Investments, including derivative assets | (304.2) | (402) | |
Net unrealized gains on available-for-sale securities | (1,118.1) | (1,762.1) | |
Deferred income tax liabilities: Real estate | (141.6) | (158.5) | |
Intangible assets | (408) | (387.5) | |
Insurance liabilities | (44.2) | ||
Other deferred income tax liabilities | (54.9) | (43.4) | |
Total deferred income tax liabilities | (2,653.3) | (3,276.1) | |
Total net deferred income tax liabilities | (2,235.2) | (2,217) | |
Net deferred income taxes by jurisdiction | |||
Net deferred income tax assets | 85 | 113.8 | |
Net deferred income tax liabilities | (2,320.2) | (2,330.8) | |
Total net deferred income tax liabilities | (2,235.2) | (2,217) | |
Deferred income tax disclosures | |||
Adjustments to deferred tax assets and liabilities | $ 11.1 | ||
Accumulated but undistributed earnings from operations of foreign subsidiaries for which U.S. federal and state deferred income taxes have not been provided | 912.8 | 997.4 | |
Excess book carrying value over tax basis with respect to the original investment of foreign subsidiaries for which U.S. federal and state deferred income taxes have not been provided | 106.2 | ||
Current income tax receivables associated with outstanding audit issues | |||
Current income tax (receivables) payables associated with outstanding audit issues | (12.7) | (54.6) | |
U.S. Federal | |||
Deferred income tax assets: | |||
Tax credit carryforwards | 0 | 4.6 | |
Net deferred income taxes by jurisdiction | |||
Net deferred income tax liabilities | (2,023.6) | (2,011.8) | |
State | |||
Net deferred income taxes by jurisdiction | |||
Net deferred income tax assets | 61.2 | 81.1 | |
Deferred income tax disclosures-operating loss carryforwards | |||
Net operating loss carryforwards | 267.3 | 269.5 | |
Foreign | |||
Net deferred income taxes by jurisdiction | |||
Net deferred income tax assets | 23.8 | 32.7 | |
Net deferred income tax liabilities | (296.6) | (319) | |
Deferred income tax disclosures-operating loss carryforwards | |||
Net operating loss carryforwards | 164.1 | 170.3 | |
Valuation allowances on income tax benefits primarily associated with foreign net operating loss carryforwards | $ 28 | $ 18.4 |
Employee and Agent Benefits - P
Employee and Agent Benefits - Plan Information (Details) | 12 Months Ended |
Dec. 31, 2021 | |
Pension benefits | |
Defined Benefit Plan Disclosures | |
Period of employment used to calculate average annual compensation for the final average pay benefit | 5 years |
Employee and Agent Benefits - B
Employee and Agent Benefits - Benefit Obligation and Funded Status (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Pension benefits | |||
Change in benefit obligation | |||
Benefit obligation at beginning of year | $ (4,210.2) | $ (3,692.1) | |
Service cost | (83.2) | (72.7) | $ (66) |
Interest cost | (103.3) | (117.3) | (126.5) |
Actuarial gain (loss) | 75.8 | (462.4) | |
Benefits paid | 137.2 | 134.3 | |
Benefit obligation at end of year | (4,183.7) | (4,210.2) | (3,692.1) |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 3,373.5 | 2,926 | |
Actual return on plan assets | 208.7 | 521.3 | |
Employer contribution | 105.1 | 60.5 | |
Benefits paid | (137.2) | (134.3) | |
Fair value of plan assets at end of year | 3,550.1 | 3,373.5 | 2,926 |
Amount recognized in statement of financial position | |||
Amount recognized in other liabilities | (633.6) | (836.7) | |
Total assets (liabilities) recognized in statement of financial position | (633.6) | (836.7) | |
Amount recognized in accumulated other comprehensive (income) loss | |||
Total net actuarial (gain) loss | 588 | 760 | |
Prior service (benefit) cost | (104.2) | (121) | |
Pre-tax accumulated other comprehensive (income) loss | 483.8 | 639 | |
Additional defined benefit plan disclosures | |||
Accumulated benefit obligation | 4,149.3 | 4,136.5 | |
Market value of assets held in Rabbi trusts for benefit of nonqualified pension plan participants | 386.3 | 394.8 | |
Other postretirement benefits | |||
Change in benefit obligation | |||
Benefit obligation at beginning of year | (108) | (101.4) | |
Interest cost | (2.2) | (2.8) | (3.7) |
Actuarial gain (loss) | 7.6 | (11.7) | |
Participant contributions | (6.1) | (6) | |
Benefits paid | 13.5 | 12.8 | |
Plan amendments | 1 | ||
Other changes in benefit obligation | (0.1) | 0.1 | |
Benefit obligation at end of year | (95.3) | (108) | (101.4) |
Change in plan assets | |||
Fair value of plan assets at beginning of year | 780.6 | 732.8 | |
Actual return on plan assets | 1.6 | 53.1 | |
Employer contribution | 1.5 | 1.5 | |
Participant contributions | 6.1 | 6 | |
Benefits paid | (13.5) | (12.8) | |
Assets re-designated for non-retiree benefits | 656.5 | ||
Fair value of plan assets at end of year | 119.8 | 780.6 | $ 732.8 |
Amount recognized in statement of financial position | |||
Amount recognized in other assets | 24.5 | 675.5 | |
Amount recognized in other liabilities | (2.9) | ||
Total assets (liabilities) recognized in statement of financial position | 24.5 | 672.6 | |
Amount recognized in accumulated other comprehensive (income) loss | |||
Total net actuarial (gain) loss | (26.7) | (22.8) | |
Prior service (benefit) cost | (6.2) | (7.3) | |
Pre-tax accumulated other comprehensive (income) loss | $ (32.9) | $ (30.1) |
Employee and Agent Benefits - O
Employee and Agent Benefits - Other Postretirement Plan Changes and Plan Gains Losses (Details) - Other postretirement benefits $ in Millions | Jan. 01, 2021USD ($) |
Defined Benefit Plan Disclosures | |
Amount of assets in excess of expected liability for retirees, re-designated for non-retiree benefits | $ 656.5 |
Percentage of assets in excess of expected liabilities to fund other benefits covered under the plans | 125.00% |
Employee and Agent Benefits - A
Employee and Agent Benefits - ABO in Excess of Plan Assets (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Pension benefits | ||
Information for Defined Benefit Plans With an Accumulated Benefit Obligation in Excess of Plan Assets | ||
Projected benefit obligation for defined benefit plans with an accumulated benefit obligation in excess of plan assets | $ 4,183.7 | $ 4,210.2 |
Accumulated benefit obligation for defined benefit plans with an accumulated benefit obligation in excess of plan assets | 4,149.3 | 4,136.5 |
Fair value of plan assets for defined benefit plans with an accumulated benefit obligation in excess of plan assets | $ 3,550.1 | 3,373.5 |
Other postretirement benefits | ||
Information for Defined Benefit Plans With an Accumulated Benefit Obligation in Excess of Plan Assets | ||
Accumulated benefit obligation for defined benefit plans with an accumulated benefit obligation in excess of plan assets | $ 2.9 |
Employee and Agent Benefits - N
Employee and Agent Benefits - Net Periodic Benefit Cost (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Plan actuarial gain and loss amortization disclosures | |||
Allowable corridor not used for amortization of actuarial gains and losses of qualified pension plan (as a percent) | 10.00% | ||
Pension benefits | |||
Components of Net Periodic Benefit Cost (Income) | |||
Service cost | $ 83.2 | $ 72.7 | $ 66 |
Interest cost | $ 103.3 | $ 117.3 | $ 126.5 |
Interest cost, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Expected return on plan assets | $ (182.7) | $ (156.8) | $ (148.8) |
Expected return on plan assets, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Amortization of prior service (benefit) cost | $ (16.8) | $ (16.8) | $ (11.3) |
Amortization of prior service (benefit) cost, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Recognized net actuarial (gain) loss | $ 70.2 | $ 75.4 | $ 70.1 |
Recognized net actuarial (gain) loss, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Net periodic benefit cost (income) | $ 57.2 | $ 91.8 | $ 102.5 |
Other changes recognized in accumulated other comprehensive (income) loss | |||
Net actuarial (gain) loss | (101.8) | 97.9 | |
Amortization of gain (loss) | (70.2) | (75.4) | |
Amortization of prior service benefit (cost) | 16.8 | 16.8 | |
Total recognized in pre-tax accumulated other comprehensive (income) loss | (155.2) | 39.3 | |
Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss | (98) | 131.1 | |
Other postretirement benefits | |||
Components of Net Periodic Benefit Cost (Income) | |||
Interest cost | $ 2.2 | $ 2.8 | $ 3.7 |
Interest cost, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Expected return on plan assets | $ (4.8) | $ (36) | $ (33.2) |
Expected return on plan assets, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Amortization of prior service (benefit) cost | $ (1.1) | $ (1) | $ (1.2) |
Amortization of prior service (benefit) cost, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Recognized net actuarial (gain) loss | $ (0.5) | $ 0.1 | |
Recognized net actuarial (gain) loss, location on consolidated statements of operations | Operating expenses | Operating expenses | Operating expenses |
Net periodic benefit cost (income) | $ (4.2) | $ (34.2) | $ (30.6) |
Other changes recognized in accumulated other comprehensive (income) loss | |||
Net actuarial (gain) loss | (4.4) | (5.4) | |
Prior service (benefit) cost | (1) | ||
Amortization of gain (loss) | 0.5 | ||
Amortization of prior service benefit (cost) | 1.1 | 1 | |
Total recognized in pre-tax accumulated other comprehensive (income) loss | (2.8) | (5.4) | |
Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss | $ (7) | $ (39.6) |
Employee and Agent Benefits - W
Employee and Agent Benefits - Weighted Average Assumptions (Details) | 3 Months Ended | 5 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||
Jun. 30, 2020 | Mar. 31, 2020 | May 31, 2019 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Pension benefits | ||||||||
Weighted-average assumptions used to determine benefit obligations as disclosed under the Obligations and Funded Status section | ||||||||
Discount rate: Benefit obligation (as a percent) | 2.50% | 2.75% | 2.50% | |||||
Interest crediting rate - cash balance benefit | 5.00% | 5.00% | 5.00% | |||||
Rate of compensation increase: Benefit obligation (as a percent) | 4.41% | 4.59% | 4.41% | |||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Discount rate: Net periodic benefit cost (as a percent) | 4.15% | 3.70% | 2.50% | 3.25% | 3.70% | |||
Expected long-term return on plan assets: Net periodic benefit cost (as a percent) | 5.55% | 5.60% | 5.95% | |||||
Interest crediting rate - cash balance benefit | 5.00% | 5.00% | ||||||
Pension benefits, Cash balance benefit | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Rate of compensation increase: Net periodic benefit cost (as a percent) | 4.92% | 4.95% | 4.94% | |||||
Pension benefits, Traditional benefit | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Rate of compensation increase: Net periodic benefit cost (as a percent) | 2.96% | 2.98% | 2.73% | |||||
Other postretirement benefits | ||||||||
Weighted-average assumptions used to determine benefit obligations as disclosed under the Obligations and Funded Status section | ||||||||
Discount rate: Benefit obligation (as a percent) | 2.10% | 2.50% | 2.10% | |||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Discount rate: Net periodic benefit cost (as a percent) | 2.95% | 2.90% | 2.10% | 2.95% | 3.95% | |||
Expected long-term return on plan assets: Net periodic benefit cost (as a percent) | 4.25% | 4.94% | 5.19% | |||||
Assumed Health Care Cost Trend Rates | ||||||||
Health care cost trend rate assumed for next year under age 65 (as a percent) | 6.75% | 7.00% | 6.75% | |||||
Health care cost trend rate assumed for next year age 65 and over (as a percent) | 6.00% | 6.50% | 6.00% | |||||
Rate to which the health care cost trend rate is assumed to decline (the ultimate trend rate) (as a percent) | 4.50% | 4.50% | 4.50% | |||||
Year that the health care cost trend rate reaches the ultimate trend rate under age 65 (calendar year) | 2030 | 2029 | ||||||
Year that the health care cost trend rate reaches the ultimate trend rate age 65 and over (calendar year) | 2029 | 2026 | ||||||
Home office medical and life plans | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Expected long-term return on plan assets: Net periodic benefit cost (as a percent) | 4.25% | |||||||
Agent medical and life plans | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Expected long-term return on plan assets: Net periodic benefit cost (as a percent) | 4.25% | |||||||
Long-term care plans | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Subsidy increase cap allowed per calendar year (as a percent) | 5.00% | |||||||
Post-65 medical plans | ||||||||
Weighted-average assumptions used to determine net periodic benefit cost | ||||||||
Expected long-term return on plan assets: Net periodic benefit cost (as a percent) | 4.25% |
Employee and Agent Benefits - F
Employee and Agent Benefits - Fair Value of Plan Assets (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Pension benefits | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | $ 3,550.1 | $ 3,373.5 | $ 2,926 |
Pension benefits | Qualified benefit plans | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 3,550.1 | 3,373.5 | |
Pension benefits | Qualified benefit plans | Pooled separate account investments | U.S. large cap equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 422.5 | 712.2 | |
Pension benefits | Qualified benefit plans | Pooled separate account investments | U.S. small/mid cap equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 65.9 | 121.6 | |
Pension benefits | Qualified benefit plans | Pooled separate account investments | Balanced asset allocation portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 119 | 103.7 | |
Pension benefits | Qualified benefit plans | Pooled separate account investments | International equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 252.5 | 459.6 | |
Pension benefits | Qualified benefit plans | Pooled separate account investments | Real estate investment portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 239.6 | 195.1 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | U.S. government and agencies | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 451.2 | 297.5 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | States and political subdivisions | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 31.2 | 28 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Corporate debt securities | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 1,678.1 | 1,223.1 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Commercial mortgage-backed securities | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 18.2 | 13.6 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Other debt obligations | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 9.2 | 6.4 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Hedge funds | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 175.7 | 155.8 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Pooled separate account investment | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 79.3 | 55.1 | |
Pension benefits | Qualified benefit plans | Single client separate account investments | Other | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 7.7 | 1.8 | |
Pension benefits | Qualified benefit plans | Amount measured at net asset value | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 175.7 | 155.8 | |
Pension benefits | Qualified benefit plans | Amount measured at net asset value | Single client separate account investments | Hedge funds | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 175.7 | 155.8 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 1 | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 451.2 | 297.5 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 1 | Single client separate account investments | U.S. government and agencies | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 451.2 | 297.5 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 2,923.2 | 2,920.2 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Pooled separate account investments | U.S. large cap equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 422.5 | 712.2 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Pooled separate account investments | U.S. small/mid cap equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 65.9 | 121.6 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Pooled separate account investments | Balanced asset allocation portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 119 | 103.7 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Pooled separate account investments | International equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 252.5 | 459.6 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Pooled separate account investments | Real estate investment portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 239.6 | 195.1 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | States and political subdivisions | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 31.2 | 28 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | Corporate debt securities | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 1,678.1 | 1,223.1 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | Commercial mortgage-backed securities | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 18.2 | 13.6 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | Other debt obligations | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 9.2 | 6.4 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | Pooled separate account investment | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 79.3 | 55.1 | |
Pension benefits | Qualified benefit plans | Fair value hierarchy Level 2 | Single client separate account investments | Other | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 7.7 | 1.8 | |
Other postretirement benefits | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 119.8 | 780.6 | $ 732.8 |
Fair value of plan assets included in trust owned life insurance contract | 117.6 | ||
Other postretirement benefits | Cash and cash equivalents | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 0.6 | 0.5 | |
Other postretirement benefits | Fixed income security portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 57.7 | 625.2 | |
Other postretirement benefits | U.S. equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 42.8 | 103.5 | |
Other postretirement benefits | International equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 18.7 | 51.4 | |
Other postretirement benefits | Fair value hierarchy Level 1 | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 119.8 | 663 | |
Other postretirement benefits | Fair value hierarchy Level 1 | Cash and cash equivalents | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 0.6 | 0.5 | |
Other postretirement benefits | Fair value hierarchy Level 1 | Fixed income security portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 57.7 | 605.9 | |
Other postretirement benefits | Fair value hierarchy Level 1 | U.S. equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 42.8 | 38.2 | |
Other postretirement benefits | Fair value hierarchy Level 1 | International equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | $ 18.7 | 18.4 | |
Other postretirement benefits | Fair value hierarchy Level 2 | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 117.6 | ||
Other postretirement benefits | Fair value hierarchy Level 2 | Fixed income security portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 19.3 | ||
Other postretirement benefits | Fair value hierarchy Level 2 | U.S. equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | 65.3 | ||
Other postretirement benefits | Fair value hierarchy Level 2 | International equity portfolios | |||
Defined benefit plan, fair value of plan assets | |||
Fair value of plan assets | $ 33 |
Employee and Agent Benefits - T
Employee and Agent Benefits - Target Plan Asset Allocation (Details) | Dec. 31, 2021 |
Pension benefits | Qualified benefit plans | Fixed income security portfolios | Minimum | |
Asset category target allocation | |
Asset category target allocation | 25.00% |
Pension benefits | Qualified benefit plans | Fixed income security portfolios | Maximum | |
Asset category target allocation | |
Asset category target allocation | 80.00% |
Pension benefits | Qualified benefit plans | Equity portfolios | Minimum | |
Asset category target allocation | |
Asset category target allocation | 5.00% |
Pension benefits | Qualified benefit plans | Equity portfolios | Maximum | |
Asset category target allocation | |
Asset category target allocation | 60.00% |
Pension benefits | Qualified benefit plans | Real estate investment portfolios | |
Asset category target allocation | |
Asset category target allocation | 10.00% |
Pension benefits | Qualified benefit plans | Alternatives | Minimum | |
Asset category target allocation | |
Asset category target allocation | 0.00% |
Pension benefits | Qualified benefit plans | Alternatives | Maximum | |
Asset category target allocation | |
Asset category target allocation | 5.00% |
Other postretirement benefits | U.S. equity portfolios | |
Asset category target allocation | |
Asset category target allocation | 35.00% |
Other postretirement benefits | International equity portfolios | |
Asset category target allocation | |
Asset category target allocation | 15.00% |
Other postretirement benefits | Fixed income security portfolios | |
Asset category target allocation | |
Asset category target allocation | 50.00% |
Employee and Agent Benefits - C
Employee and Agent Benefits - Contributions and Estimated Future Benefit Payments (Details) $ in Millions | Dec. 31, 2021USD ($) |
Pension benefits | |
Estimated Future Benefit Payments | |
Estimated future benefit payments, Year 1 | $ 173.6 |
Estimated future benefit payments, Year 2 | 166.4 |
Estimated future benefit payments, Year 3 | 178.6 |
Estimated future benefit payments, Year 4 | 182 |
Estimated future benefit payments, Year 5 | 192.5 |
Estimated future benefit payments, Years 6-10 | 1,087.3 |
Pension benefits | Maximum | |
Contributions | |
Possible contributions to be made during the next fiscal year to the qualified and nonqualified pension plans combined | 75 |
Other postretirement benefits | |
Estimated Future Benefit Payments | |
Estimated future benefit payments, Year 1 | 14.5 |
Estimated future benefit payments, Year 2 | 13.3 |
Estimated future benefit payments, Year 3 | 12.2 |
Estimated future benefit payments, Year 4 | 11 |
Estimated future benefit payments, Year 5 | 9.7 |
Estimated future benefit payments, Years 6-10 | $ 35.9 |
Employee and Agent Benefits - S
Employee and Agent Benefits - Supplemental Information, Qualified and Nonqualified Plans (Details) - Pension benefits - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Amount recognized in statement of financial position | |||
Amount recognized in other liabilities | $ (633.6) | $ (836.7) | |
Total assets (liabilities) recognized in statement of financial position | (633.6) | (836.7) | |
Amount recognized in accumulated other comprehensive (income) loss | |||
Total net actuarial (gain) loss | 588 | 760 | |
Prior service (benefit) cost | (104.2) | (121) | |
Pre-tax accumulated other comprehensive (income) loss | 483.8 | 639 | |
Components of Net Periodic Benefit Cost (Income) | |||
Service cost | 83.2 | 72.7 | $ 66 |
Interest cost | 103.3 | 117.3 | 126.5 |
Expected return on plan assets | (182.7) | (156.8) | (148.8) |
Amortization of prior service (benefit) cost | (16.8) | (16.8) | (11.3) |
Recognized net actuarial (gain) loss | 70.2 | 75.4 | 70.1 |
Net periodic benefit cost (income) | 57.2 | 91.8 | $ 102.5 |
Other changes recognized in accumulated other comprehensive (income) loss | |||
Net actuarial (gain) loss | (101.8) | 97.9 | |
Amortization of gain (loss) | (70.2) | (75.4) | |
Amortization of prior service benefit (cost) | 16.8 | 16.8 | |
Total recognized in pre-tax accumulated other comprehensive (income) loss | (155.2) | 39.3 | |
Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss | (98) | 131.1 | |
Qualified benefit plans | |||
Amount recognized in statement of financial position | |||
Amount recognized in other liabilities | (108.4) | (294.9) | |
Total assets (liabilities) recognized in statement of financial position | (108.4) | (294.9) | |
Amount recognized in accumulated other comprehensive (income) loss | |||
Total net actuarial (gain) loss | 415.5 | 563.5 | |
Prior service (benefit) cost | (85.2) | (97.8) | |
Pre-tax accumulated other comprehensive (income) loss | 330.3 | 465.7 | |
Components of Net Periodic Benefit Cost (Income) | |||
Service cost | 76.2 | 66.1 | |
Interest cost | 90.1 | 101.2 | |
Expected return on plan assets | (182.7) | (156.8) | |
Amortization of prior service (benefit) cost | (12.6) | (12.6) | |
Recognized net actuarial (gain) loss | 52.8 | 59.9 | |
Net periodic benefit cost (income) | 23.8 | 57.8 | |
Other changes recognized in accumulated other comprehensive (income) loss | |||
Net actuarial (gain) loss | (95.3) | 55.7 | |
Amortization of gain (loss) | (52.8) | (59.8) | |
Amortization of prior service benefit (cost) | 12.6 | 12.6 | |
Total recognized in pre-tax accumulated other comprehensive (income) loss | (135.5) | 8.5 | |
Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss | (111.7) | 66.3 | |
Nonqualified benefit plans | |||
Amount recognized in statement of financial position | |||
Amount recognized in other liabilities | (525.2) | (541.8) | |
Total assets (liabilities) recognized in statement of financial position | (525.2) | (541.8) | |
Amount recognized in accumulated other comprehensive (income) loss | |||
Total net actuarial (gain) loss | 172.5 | 196.5 | |
Prior service (benefit) cost | (19) | (23.2) | |
Pre-tax accumulated other comprehensive (income) loss | 153.5 | 173.3 | |
Components of Net Periodic Benefit Cost (Income) | |||
Service cost | 7 | 6.6 | |
Interest cost | 13.2 | 16.1 | |
Amortization of prior service (benefit) cost | (4.2) | (4.2) | |
Recognized net actuarial (gain) loss | 17.4 | 15.5 | |
Net periodic benefit cost (income) | 33.4 | 34 | |
Other changes recognized in accumulated other comprehensive (income) loss | |||
Net actuarial (gain) loss | (6.5) | 42.2 | |
Amortization of gain (loss) | (17.4) | (15.6) | |
Amortization of prior service benefit (cost) | 4.2 | 4.2 | |
Total recognized in pre-tax accumulated other comprehensive (income) loss | (19.7) | 30.8 | |
Total recognized in net periodic benefit cost and pre-tax accumulated other comprehensive (income) loss | $ 13.7 | $ 64.8 |
Employee and Agent Benefits - D
Employee and Agent Benefits - Defined Contribution and Deferred Compensation Plans (Details) - USD ($) shares in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Contribution Plan Disclosures | |||
Number of common stock shares allocated participants in the employee stock ownership plan | 2 | 2.3 | |
Fair value of employee stock ownership plan | $ 146,100,000 | $ 115,100,000 | |
Pension benefits | Qualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Maximum amount of compensation eligible participants could contribute to defined contribution plans | 19,500 | ||
Amount contributed by the employer to defined contribution plans | 60,500,000 | 56,700,000 | $ 55,300,000 |
Pension benefits | Nonqualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Amount contributed by the employer to defined contribution plans | $ 3,400,000 | $ 3,100,000 | $ 3,200,000 |
Grandfathered Choice Participant | Qualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Eligibility age to be able to elect to retain benefits in defined contribution plan | 47 years | ||
Minimum years of service to be able to elect to retain benefits in defined contribution plan | 10 years | ||
Contribution rate of employer to match participant's contributions (as a percent) | 50.00% | ||
Maximum percent of participant's compensation matched by employer (as a percent) | 3.00% | ||
Grandfathered Choice Participant | Nonqualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Contribution rate of employer to match participant's contributions (as a percent) | 50.00% | ||
Maximum percent of participant's compensation matched by employer (as a percent) | 3.00% | ||
All other participants | Qualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Contribution rate of employer to match participant's contributions (as a percent) | 75.00% | ||
Maximum percent of participant's compensation matched by employer (as a percent) | 6.00% | ||
All other participants | Nonqualified benefit plans | |||
Defined Contribution Plan Disclosures | |||
Contribution rate of employer to match participant's contributions (as a percent) | 75.00% | ||
Maximum percent of participant's compensation matched by employer (as a percent) | 6.00% |
Contingencies, Guarantees, In_3
Contingencies, Guarantees, Indemnifications and Leases - Guarantees and Indemnifications (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Guaranty Funds | ||
Undiscounted liability balance for guaranty fund assessments | $ 21 | $ 21.1 |
Premium tax offsets | 9.7 | $ 9.6 |
Guarantees to third parties primarily related to former subsidiaries and joint ventures | ||
Guarantees and Indemnifications | ||
Maximum exposure under guarantees | 102 | |
Guarantees related to P-Caps contingent funding agreements | ||
Guarantees and Indemnifications | ||
Maximum exposure under guarantees | 750 | |
Lawsuit alleging breach of fiduciary duty related to PFIO | ||
Loss contingencies - disclosures | ||
Estimated losses accrued related to legal matters | $ 0 |
Contingencies, Guarantees, In_4
Contingencies, Guarantees, Indemnifications and Leases - Leases (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Assets | |||
Operating lease assets | $ 210.5 | $ 234.9 | |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | |
Finance lease assets | $ 94.2 | $ 49.5 | |
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | |
Total lease assets | $ 304.7 | $ 284.4 | |
Liabilities | |||
Operating lease liabilities | $ 209.9 | $ 231.4 | |
Operating Lease, Liability, Statement of Financial Position [Extensible List] | Other Liabilities | Other Liabilities | |
Finance lease liabilities | $ 94.8 | $ 50.1 | |
Finance Lease, Liability, Statement of Financial Position [Extensible List] | Other Liabilities | Other Liabilities | |
Total lease liabilities | $ 304.7 | $ 281.5 | |
Finance lease cost: | |||
Amortization of right-of-use assets | 30.5 | 20.5 | $ 14.6 |
Interest on lease liabilities | 1 | 1 | 1 |
Operating lease cost | 66.6 | 58.7 | 55.8 |
Other lease cost | 10.8 | 8.6 | 8 |
Sublease income | (1.7) | (1.6) | (1.7) |
Total lease cost | 107.2 | 87.2 | 77.7 |
Payments for operating leases | 63 | 71.6 | 56.1 |
Payments for finance leases | 31.4 | 21.2 | $ 15.1 |
Operating leases, payments due for the twelve months ending December 31: | |||
2022 | 55.6 | ||
2023 | 46.5 | ||
2024 | 34.3 | ||
2025 | 27.9 | ||
2026 | 22.7 | ||
2027 and thereafter | 47.2 | ||
Total lease payments | 234.2 | ||
Less: interest | 24.3 | ||
Present value of lease liabilities | 209.9 | 231.4 | |
Finance leases, payments due for the twelve months ending December 31: | |||
2022 | 32.8 | ||
2023 | 31.4 | ||
2024 | 23.7 | ||
2025 | 7.9 | ||
2026 | 0.5 | ||
Total lease payments | 96.3 | ||
Less: interest | 1.5 | ||
Present value of lease liabilities | 94.8 | 50.1 | |
Total leases, payments due for the twelve months ending December 31: | |||
2022 | 88.4 | ||
2023 | 77.9 | ||
2024 | 58 | ||
2025 | 35.8 | ||
2026 | 23.2 | ||
2027 and thereafter | 47.2 | ||
Total lease payments | 330.5 | ||
Less: interest | 25.8 | ||
Present value of lease liabilities | $ 304.7 | $ 281.5 | |
Weighted-average remaining lease term and weighted-average discount rates | |||
Weighted average remaining lease term, Operating leases | 6 years 6 months | 6 years 8 months 12 days | 6 years 8 months 12 days |
Weighted average remaining lease term, Finance leases | 3 years 2 months 12 days | 3 years | 2 years 7 months 6 days |
Weighted-average discount rate, Operating leases | 3.40% | 3.20% | 3.90% |
Weighted-average discount rate, Finance leases | 1.00% | 1.80% | 2.70% |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock Dividends and Reconciliation of Outstanding Common Shares (Details) - Common stock - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 1 Months Ended | 12 Months Ended | |||||
Jan. 31, 2022 | Jun. 30, 2021 | Feb. 29, 2020 | Nov. 30, 2018 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Common Stock Dividends | |||||||
Dividends declared per common share (in dollars per share) | $ 2.44 | $ 2.24 | $ 2.18 | ||||
Reconciliation of Outstanding Common Shares | |||||||
Outstanding shares at beginning of period | 261.7 | 273.3 | 276.6 | 279.5 | |||
Shares issued | 3 | 2.6 | 2.6 | ||||
Treasury stock acquired | (14.6) | (5.9) | (5.5) | ||||
Outstanding shares at end of period | 261.7 | 273.3 | 276.6 | ||||
Common stock share repurchase disclosures | |||||||
Share repurchase program, maximum authorized amount (in dollars) | $ 1,600 | $ 1,200 | $ 900 | $ 500 |
Stockholders' Equity - Other Co
Stockholders' Equity - Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss), pre-tax | $ (903.8) | $ 1,683.6 | $ 3,326.3 |
Other comprehensive income (loss), tax | 128.1 | (336.6) | (719.6) |
Other comprehensive income (loss) | (775.7) | 1,347 | 2,606.7 |
Net unrealized gains (losses) on available-for-sale securities including NCI | |||
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss) before reclassifications, pre-tax | (2,960) | 3,441.4 | 4,414.1 |
Adjustments for assumed changes in amortization patterns, pre-tax | 171.4 | (179) | (293) |
Adjustments for assumed changes in policyholder liabilities, pre-tax | 1,913.1 | (1,478.2) | (847.7) |
Other comprehensive income (loss), pre-tax | (856.1) | 1,731.3 | 3,320.8 |
Other comprehensive income (loss) before reclassifications, tax | 665.4 | (728.7) | (947) |
Reclassification from accumulated other comprehensive income, tax | (5.1) | 12.6 | (9.7) |
Adjustments for assumed changes in amortization patterns, tax | (36) | 37.6 | 61.5 |
Adjustments for assumed changes in policyholder liabilities, tax | (439.1) | 323.7 | 190.5 |
Other comprehensive income (loss), tax | 185.2 | (354.8) | (704.7) |
Other comprehensive income (loss) before reclassifications, after-tax | (2,294.6) | 2,712.7 | 3,467.1 |
Reclassification from accumulated other comprehensive income, after-tax | 14.3 | (40.3) | 37.7 |
Adjustments for assumed changes in amortization patterns, after-tax | 135.4 | (141.4) | (231.5) |
Adjustments for assumed changes in policyholder liabilities, after-tax | 1,474 | (1,154.5) | (657.2) |
Other comprehensive income (loss) | (670.9) | 1,376.5 | 2,616.1 |
Net unrealized gains (losses) on available-for-sale securities including NCI | Net realized capital gains (losses) | |||
Other Comprehensive Income (Loss) | |||
Reclassification from accumulated other comprehensive income, pre-tax | 19.4 | (52.9) | 47.4 |
Net unrealized gains (losses) on derivative instruments including NCI | |||
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss) before reclassifications, pre-tax | 66.7 | (28.1) | (0.5) |
Reclassification from accumulated other comprehensive income, pre-tax | (25.5) | (27.1) | (23.9) |
Adjustments for assumed changes in amortization patterns, pre-tax | (0.2) | 2.7 | 3.1 |
Adjustments for assumed changes in policyholder liabilities, pre-tax | 1.6 | 7.8 | 7.9 |
Other comprehensive income (loss), pre-tax | 42.6 | (44.7) | (13.4) |
Other comprehensive income (loss) before reclassifications, tax | (14) | 6.5 | |
Reclassification from accumulated other comprehensive income, tax | 5.4 | 5.1 | 4.9 |
Adjustments for assumed changes in amortization patterns, tax | (0.5) | (0.6) | |
Adjustments for assumed changes in policyholder liabilities, tax | (0.4) | (1.6) | (1.9) |
Other comprehensive income (loss), tax | (9) | 9.5 | 2.4 |
Other comprehensive income (loss) before reclassifications, after-tax | 52.7 | (21.6) | (0.5) |
Reclassification from accumulated other comprehensive income, after-tax | (20.1) | (22) | (19) |
Adjustments for assumed changes in amortization patterns, after-tax | (0.2) | 2.2 | 2.5 |
Adjustments for assumed changes in policyholder liabilities, after-tax | 1.2 | 6.2 | 6 |
Other comprehensive income (loss) | 33.6 | (35.2) | (11) |
Foreign currency translation adjustment relating to noncontrolling interest | Net income attributable to noncontrolling interest | |||
Other Comprehensive Income (Loss) | |||
Reclassification from accumulated other comprehensive income, pre-tax | 8.7 | 5.7 | |
Foreign currency translation adjustment including NCI | |||
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss) before reclassifications, pre-tax | (267.9) | (11.7) | (112.3) |
Other comprehensive income (loss), pre-tax | (248.6) | 31.3 | (86.2) |
Other comprehensive income (loss) before reclassifications, tax | (5.6) | (2.6) | 7.5 |
Reclassification from accumulated other comprehensive income, tax | 1.9 | ||
Other comprehensive income (loss), tax | (5.6) | (0.7) | 7.5 |
Other comprehensive income (loss) before reclassifications, after-tax | (273.5) | (14.3) | (104.8) |
Reclassification from accumulated other comprehensive income, after-tax | 19.3 | 44.9 | 26.1 |
Other comprehensive income (loss) | (254.2) | 30.6 | (78.7) |
Foreign currency translation adjustment including NCI | Net realized capital gains (losses) | |||
Other Comprehensive Income (Loss) | |||
Reclassification from accumulated other comprehensive income, pre-tax | 19.3 | 43 | 26.1 |
Unrecognized postretirement benefit obligation including NCI | |||
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss) before reclassifications, pre-tax | 106.5 | (91.9) | 43.6 |
Other comprehensive income (loss), pre-tax | 158.3 | (34.3) | 101.3 |
Other comprehensive income (loss) before reclassifications, tax | (28.5) | 24.9 | (8.6) |
Reclassification from accumulated other comprehensive income, tax | (14) | (15.5) | (15.4) |
Other comprehensive income (loss), tax | (42.5) | 9.4 | (24) |
Other comprehensive income (loss) before reclassifications, after-tax | 78 | (67) | 35 |
Reclassification from accumulated other comprehensive income, after-tax | 37.8 | 42.1 | 42.3 |
Other comprehensive income (loss) | 115.8 | (24.9) | 77.3 |
Unrecognized postretirement benefit obligation including NCI | Operating expense | |||
Other Comprehensive Income (Loss) | |||
Reclassification from accumulated other comprehensive income, pre-tax | $ 51.8 | $ 57.6 | 57.7 |
Noncredit component of impairment losses on fixed maturities available-for-sale including NCI | |||
Other Comprehensive Income (Loss) | |||
Other comprehensive income (loss) before reclassifications, pre-tax | 5.2 | ||
Adjustments for assumed changes in amortization patterns, pre-tax | (1.4) | ||
Other comprehensive income (loss), pre-tax | 3.8 | ||
Other comprehensive income (loss) before reclassifications, tax | (1.1) | ||
Adjustments for assumed changes in amortization patterns, tax | 0.3 | ||
Other comprehensive income (loss), tax | (0.8) | ||
Other comprehensive income (loss) before reclassifications, after-tax | 4.1 | ||
Adjustments for assumed changes in amortization patterns, after-tax | (1.1) | ||
Other comprehensive income (loss) | $ 3 |
Stockholders' Equity - AOCI and
Stockholders' Equity - AOCI and Noncontrolling Interest (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | ||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | $ 16,558.9 | |||
Purchase of subsidiary shares from noncontrolling interest | [1] | (18.1) | $ (1.4) | $ (0.6) |
Balances | 16,069.4 | 16,558.9 | ||
Change in redeemable noncontrolling interest rollforward | ||||
Redeemable noncontrolling interest, balance at beginning of period | 255.6 | 264.9 | 391.2 | |
Net income (loss) attributable to redeemable noncontrolling interest | 17.5 | 7.5 | 33.6 | |
Contributions from redeemable noncontrolling interest | 166.8 | 136.2 | 402.1 | |
Distributions to redeemable noncontrolling interest | (66.8) | (62) | (66.3) | |
Purchase of subsidiary shares from redeemable noncontrolling interest | (6.1) | (1.1) | ||
Change in redemption value of redeemable noncontrolling interest | 3.1 | 0.2 | 5.4 | |
Other comprehensive income (loss) attributable to redeemable noncontrolling interest | (0.2) | 0.6 | 5.3 | |
Redeemable noncontrolling interest, balance at end of period | 332.5 | 255.6 | 264.9 | |
Redeemable noncontrolling interest of deconsolidated entities | (37.4) | (91.9) | (505.4) | |
Stock-based compensation attributable to redeemable noncontrolling interest | 0.1 | 0.1 | ||
Accumulated other comprehensive income (loss) | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | 2,383.1 | 1,037.9 | (1,565.1) | |
Other comprehensive income (loss) during the period, net of adjustments | (823.5) | 1,329.2 | 2,518.6 | |
Amounts reclassified from accumulated other comprehensive income (loss) | 51.3 | 16 | 84.4 | |
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | (772.2) | 1,345.2 | 2,603 | |
Balances | 1,610.9 | 2,383.1 | 1,037.9 | |
Net unrealized gains (losses) on available-for-sale securities | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | 4,138.3 | 2,806 | 190 | |
Other comprehensive income (loss) during the period, net of adjustments | (685.2) | 1,416.7 | 2,578.3 | |
Amounts reclassified from accumulated other comprehensive income (loss) | 14.3 | (40.3) | 37.7 | |
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | (670.9) | 1,376.4 | 2,616 | |
Balances | 3,467.4 | 4,138.3 | 2,806 | |
Net unrealized losses on available-for-sale debt securities with allowance for credit losses | 2.1 | 2.9 | ||
Net unrealized gains (losses) on available-for-sale securities | ASU 2016-13 - CECL | Effects of implementation of accounting change | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | (44.1) | |||
Balances | (44.1) | |||
Noncredit component of impairment losses on fixed maturities available-for-sale | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | (44.1) | (47.1) | ||
Amounts reclassified from accumulated other comprehensive income (loss) | 3 | |||
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | 3 | |||
Balances | (44.1) | |||
Noncredit component of impairment losses on fixed maturities available-for-sale | ASU 2016-13 - CECL | Effects of implementation of accounting change | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | 44.1 | |||
Balances | 44.1 | |||
Net unrealized gains (losses) on derivative instruments | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | 18.2 | 53.4 | 64.4 | |
Other comprehensive income (loss) during the period, net of adjustments | 53.7 | (13.2) | 8 | |
Amounts reclassified from accumulated other comprehensive income (loss) | (20.1) | (22) | (19) | |
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | 33.6 | (35.2) | (11) | |
Balances | 51.8 | 18.2 | 53.4 | |
Foreign currency translation adjustment | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | (1,312.9) | (1,341.8) | (1,259.5) | |
Other comprehensive income (loss) during the period, net of adjustments | (270) | (7.3) | (102.7) | |
Amounts reclassified from accumulated other comprehensive income (loss) | 19.3 | 36.2 | 20.4 | |
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | (250.7) | 28.9 | (82.3) | |
Balances | (1,563.6) | (1,312.9) | (1,341.8) | |
Unrecognized postretirement benefit obligations | ||||
Change in accumulated other comprehensive income (loss) rollforward | ||||
Balances | (460.5) | (435.6) | (512.9) | |
Other comprehensive income (loss) during the period, net of adjustments | 78 | (67) | 35 | |
Amounts reclassified from accumulated other comprehensive income (loss) | 37.8 | 42.1 | 42.3 | |
Other comprehensive income (loss) attributable to Principal Financial Group, Inc. | 115.8 | (24.9) | 77.3 | |
Balances | $ (344.7) | $ (460.5) | $ (435.6) | |
[1] | Excludes amounts attributable to redeemable noncontrolling interest. See Note 13, Stockholders’ Equity, for further details. |
Stockholders' Equity - Dividend
Stockholders' Equity - Dividend Limitations (Details) - Principal Life Insurance Company Only $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Dividend Limitations | |
Dividend limitation as percentage of statutory policyholder surplus (as a percent) | 10.00% |
Dividends that can be paid in upcoming calendar year without exceeding statutory limitation | $ 961.7 |
Fair Value Measurements - Asset
Fair Value Measurements - Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | $ 78,154.5 | $ 78,710.3 |
Fixed maturities, trading | 422.2 | 532.1 |
Equity securities | 2,347.2 | 2,013.4 |
Derivative instruments, assets | 337.1 | 463.5 |
Separate account assets | 182,345.4 | 175,951.4 |
Investment and universal life contracts | $ (356.3) | (467.8) |
Fixed maturities valued using internal pricing models | ||
Fixed maturities classified as Level 3 assets, percent valued using internal pricing models (as a percent) | 1.00% | |
Amount measured at net asset value | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Unfunded commitments of investments measured using NAV | $ 10.2 | 15.1 |
U.S. government and agencies | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 2,088.6 | 2,111.5 |
Non-U.S. governments | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 982 | 1,073.7 |
States and political subdivisions | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 9,304.4 | 9,167.8 |
Corporate debt securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 45,944.4 | 47,354.8 |
Residential mortgage-backed pass-through securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,152.9 | 2,986.8 |
Commercial mortgage-backed securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 5,562.2 | 4,942.3 |
Collateralized debt obligations | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,559.6 | 4,027.5 |
Other debt obligations | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 7,560.4 | 7,045.9 |
Recurring Fair Value Measurements | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 78,154.5 | 78,710.3 |
Fixed maturities, trading | 422.2 | 532.1 |
Equity securities | 2,347.2 | 2,013.4 |
Derivative instruments, assets | 337.1 | 463.5 |
Other investments | 896.2 | 746.3 |
Cash equivalents | 1,117.8 | 1,466.4 |
Sub-total excluding separate account assets | 83,275 | 83,932 |
Separate account assets | 182,345.4 | 175,951.4 |
Total assets | 265,620.4 | 259,883.4 |
Investment and universal life contracts | (356.3) | (467.8) |
Derivative liabilities | (226) | (186.1) |
Other liabilities | (0.7) | (0.4) |
Total liabilities | (583) | (654.3) |
Net assets (liabilities) | 265,037.4 | 259,229.1 |
Recurring Fair Value Measurements | Amount measured at net asset value | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Other investments | 92.7 | 75.7 |
Sub-total excluding separate account assets | 92.7 | 75.7 |
Separate account assets | 8,942.9 | 155.8 |
Total assets | 9,035.6 | 231.5 |
Net assets (liabilities) | 9,035.6 | 231.5 |
Recurring Fair Value Measurements | Fair value hierarchy Level 1 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 1,758.6 | 1,769.4 |
Fixed maturities, trading | 0.5 | 0.5 |
Equity securities | 1,027.5 | 659.7 |
Other investments | 395.3 | 252.8 |
Cash equivalents | 14.2 | 38.3 |
Sub-total excluding separate account assets | 3,196.1 | 2,720.7 |
Separate account assets | 115,261.7 | 102,550.5 |
Total assets | 118,457.8 | 105,271.2 |
Net assets (liabilities) | 118,457.8 | 105,271.2 |
Recurring Fair Value Measurements | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 75,319.7 | 76,580.5 |
Fixed maturities, trading | 416.8 | 531.6 |
Equity securities | 1,319.7 | 1,353.7 |
Derivative instruments, assets | 336.5 | 462.9 |
Other investments | 406.1 | 385.9 |
Cash equivalents | 1,103.6 | 1,428.1 |
Sub-total excluding separate account assets | 78,902.4 | 80,742.7 |
Separate account assets | 57,195.5 | 64,351.9 |
Total assets | 136,097.9 | 145,094.6 |
Derivative liabilities | (225.4) | (180.4) |
Other liabilities | (0.7) | (0.4) |
Total liabilities | (226.1) | (180.8) |
Net assets (liabilities) | 135,871.8 | 144,913.8 |
Recurring Fair Value Measurements | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 1,076.2 | 360.4 |
Fixed maturities, trading | 4.9 | |
Derivative instruments, assets | 0.6 | 0.6 |
Other investments | 2.1 | 31.9 |
Sub-total excluding separate account assets | 1,083.8 | 392.9 |
Separate account assets | 945.3 | 8,893.2 |
Total assets | 2,029.1 | 9,286.1 |
Investment and universal life contracts | (356.3) | (467.8) |
Derivative liabilities | (0.6) | (5.7) |
Total liabilities | (356.9) | (473.5) |
Net assets (liabilities) | 1,672.2 | 8,812.6 |
Recurring Fair Value Measurements | U.S. government and agencies | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 2,088.6 | 2,111.5 |
Recurring Fair Value Measurements | U.S. government and agencies | Fair value hierarchy Level 1 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 1,716.5 | 1,768.3 |
Recurring Fair Value Measurements | U.S. government and agencies | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 372.1 | 343.2 |
Recurring Fair Value Measurements | Non-U.S. governments | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 982 | 1,073.7 |
Recurring Fair Value Measurements | Non-U.S. governments | Fair value hierarchy Level 1 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 0.6 | 1.1 |
Recurring Fair Value Measurements | Non-U.S. governments | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 981.4 | 1,072.6 |
Recurring Fair Value Measurements | States and political subdivisions | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 9,304.4 | 9,167.8 |
Recurring Fair Value Measurements | States and political subdivisions | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 9,209.6 | 9,167.8 |
Recurring Fair Value Measurements | States and political subdivisions | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 94.8 | |
Recurring Fair Value Measurements | Corporate debt securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 45,944.4 | 47,354.8 |
Recurring Fair Value Measurements | Corporate debt securities | Fair value hierarchy Level 1 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 41.5 | |
Recurring Fair Value Measurements | Corporate debt securities | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 45,068.6 | 47,064 |
Recurring Fair Value Measurements | Corporate debt securities | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 834.3 | 290.8 |
Recurring Fair Value Measurements | Residential mortgage-backed pass-through securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,152.9 | 2,986.8 |
Recurring Fair Value Measurements | Residential mortgage-backed pass-through securities | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,152.9 | 2,986.8 |
Recurring Fair Value Measurements | Commercial mortgage-backed securities | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 5,562.2 | 4,942.3 |
Recurring Fair Value Measurements | Commercial mortgage-backed securities | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 5,543 | 4,929.1 |
Recurring Fair Value Measurements | Commercial mortgage-backed securities | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 19.2 | 13.2 |
Recurring Fair Value Measurements | Collateralized debt obligations | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,559.6 | 4,027.5 |
Recurring Fair Value Measurements | Collateralized debt obligations | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 3,473.8 | 4,000.3 |
Recurring Fair Value Measurements | Collateralized debt obligations | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 85.8 | 27.2 |
Recurring Fair Value Measurements | Other debt obligations | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 7,560.4 | 7,045.9 |
Recurring Fair Value Measurements | Other debt obligations | Fair value hierarchy Level 2 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | 7,518.3 | 7,016.7 |
Recurring Fair Value Measurements | Other debt obligations | Fair value hierarchy Level 3 | ||
Assets (liabilities) measured at fair value on a recurring basis | ||
Fixed maturities, available-for-sale | $ 42.1 | $ 29.2 |
Fair Value Measurements - Chang
Fair Value Measurements - Changes in Level 3 Fair Value Measurements (Details) - Recurring Fair Value Measurements - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, net derivative assets (liabilities) | $ (5.1) | $ 13 | $ 3.1 |
Total realized/unrealized gains (losses) included in net income, net derivative assets (liabilities) | (6.9) | 11.8 | (0.8) |
Net purchases, sales, issuances and settlements, net derivative assets (liabilities) | 12 | (3.4) | 10.7 |
Transfers out of Level 3, net derivative assets (liabilities) | (26.5) | ||
Ending balance, net derivative assets (liabilities) | (5.1) | 13 | |
Changes in unrealized gains (losses) included in net income relating to positions still held, net derivative assets (liabilities) | (0.6) | 9.9 | 5.3 |
Gross purchases, sales, issuances and settlements | |||
Purchases, net derivative assets (liabilities) | 1.9 | ||
Sales, net derivative assets (liabilities) | 12 | (3.4) | 8.8 |
Net purchases, sales, issuances and settlements, net derivative assets (liabilities) | 12 | (3.4) | 10.7 |
Investment and universal life contracts | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, liabilities | (467.8) | (214.2) | (45.2) |
Total realized/unrealized gains (losses) included in net income, liabilities | 81.7 | (254.9) | (145.5) |
Total realized/unrealized gains (losses) included in other comprehensive income, liabilities | 0.2 | (0.3) | (0.2) |
Net purchases, sales, issuances and settlements, liabilities | 29.6 | 1.6 | (23.3) |
Ending balance, liabilities | (356.3) | (467.8) | (214.2) |
Changes in unrealized gains (losses) included in net income relating to positions still held, liabilities | 80.3 | (262.1) | (146) |
Changes in unrealized gains (losses) included in OCI relating to positions still held, liabilities | 0.2 | (0.3) | |
Gross purchases, sales, issuances and settlements | |||
Issuances, liabilities | (16.4) | (23) | (33.4) |
Settlements, liabilities | 46 | 24.6 | 10.1 |
Net purchases, sales, issuances and settlements, liabilities | 29.6 | 1.6 | (23.3) |
Fixed maturities | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 360.4 | 384.9 | 138.8 |
Total realized/unrealized gains (losses) included in net income, assets | (24.9) | (4.5) | (6.4) |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | 22.2 | (16.7) | 7.6 |
Net purchases, sales, issuances and settlements, assets | 826.4 | 263 | 237.5 |
Transfers into Level 3, assets | 352.9 | 388.4 | 86 |
Transfers out of Level 3, assets | (460.8) | (654.7) | (78.6) |
Ending balance, assets | 1,076.2 | 360.4 | 384.9 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | (7.6) | (3.4) | (5.5) |
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | 13.6 | 13.1 | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 1,125.4 | 366 | 276.7 |
Sales, assets | (84.3) | (5.5) | (1.4) |
Settlements, assets | (214.7) | (97.5) | (37.8) |
Net purchases, sales, issuances and settlements, assets | 826.4 | 263 | 237.5 |
Fixed maturities | Trading | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 0.3 | ||
Net purchases, sales, issuances and settlements, assets | 4.9 | 0.3 | |
Transfers out of Level 3, assets | (0.3) | ||
Ending balance, assets | 4.9 | 0.3 | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 4.9 | 0.5 | |
Settlements, assets | (0.2) | ||
Net purchases, sales, issuances and settlements, assets | 4.9 | 0.3 | |
Non-U.S. governments | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 4.6 | ||
Net purchases, sales, issuances and settlements, assets | (4.6) | ||
Gross purchases, sales, issuances and settlements | |||
Settlements, assets | (4.6) | ||
Net purchases, sales, issuances and settlements, assets | (4.6) | ||
States and political subdivisions | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Total realized/unrealized gains (losses) included in other comprehensive income, assets | 12.8 | ||
Net purchases, sales, issuances and settlements, assets | (0.4) | ||
Transfers into Level 3, assets | 82.4 | ||
Ending balance, assets | 94.8 | ||
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | 12.8 | ||
Gross purchases, sales, issuances and settlements | |||
Settlements, assets | (0.4) | ||
Net purchases, sales, issuances and settlements, assets | (0.4) | ||
Corporate debt securities | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 290.8 | 81.7 | 57.9 |
Total realized/unrealized gains (losses) included in net income, assets | (21.9) | (0.9) | |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | 7.8 | 5.2 | 2.5 |
Net purchases, sales, issuances and settlements, assets | 381.8 | 118 | 17.2 |
Transfers into Level 3, assets | 175.8 | 342 | 4.1 |
Transfers out of Level 3, assets | (255.2) | ||
Ending balance, assets | 834.3 | 290.8 | 81.7 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | (4.6) | ||
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | (0.7) | 11.9 | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 626.6 | 169.2 | 41.9 |
Sales, assets | (84.3) | (5.5) | (1.4) |
Settlements, assets | (160.5) | (45.7) | (23.3) |
Net purchases, sales, issuances and settlements, assets | 381.8 | 118 | 17.2 |
Commercial mortgage-backed securities | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 13.2 | 12.9 | 9.5 |
Total realized/unrealized gains (losses) included in net income, assets | (1) | (1.3) | (3.8) |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | (0.4) | 1.4 | 3.4 |
Net purchases, sales, issuances and settlements, assets | 7.4 | (0.1) | 2.4 |
Transfers into Level 3, assets | 0.3 | 3.7 | |
Transfers out of Level 3, assets | (2.3) | ||
Ending balance, assets | 19.2 | 13.2 | 12.9 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | (1) | (1.2) | (2.9) |
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | (0.4) | 1.5 | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 7.7 | 2.4 | |
Settlements, assets | (0.3) | (0.1) | |
Net purchases, sales, issuances and settlements, assets | 7.4 | (0.1) | 2.4 |
Collateralized debt obligations | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 27.2 | 199 | 8.3 |
Total realized/unrealized gains (losses) included in net income, assets | (2) | (2.3) | (2.6) |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | 1.6 | (21.9) | 0.9 |
Net purchases, sales, issuances and settlements, assets | 420.7 | 183 | 122.5 |
Transfers into Level 3, assets | 74.1 | 69.9 | |
Transfers out of Level 3, assets | (435.8) | (330.6) | |
Ending balance, assets | 85.8 | 27.2 | 199 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | (2) | (2.2) | (2.6) |
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | 1.9 | (0.3) | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 446 | 182.5 | 124.7 |
Settlements, assets | (25.3) | 0.5 | (2.2) |
Net purchases, sales, issuances and settlements, assets | 420.7 | 183 | 122.5 |
Other debt obligations | Available-for-sale | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 29.2 | 91.3 | 58.5 |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | 0.4 | (1.4) | 0.8 |
Net purchases, sales, issuances and settlements, assets | 16.9 | (37.9) | 100 |
Transfers into Level 3, assets | 20.6 | 46.1 | 8.3 |
Transfers out of Level 3, assets | (25) | (68.9) | (76.3) |
Ending balance, assets | 42.1 | 29.2 | 91.3 |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 45.1 | 14.3 | 107.7 |
Settlements, assets | (28.2) | (52.2) | (7.7) |
Net purchases, sales, issuances and settlements, assets | 16.9 | (37.9) | 100 |
Other investments | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 31.9 | 39 | 17.2 |
Total realized/unrealized gains (losses) included in net income, assets | 12.5 | 6.3 | 6 |
Total realized/unrealized gains (losses) included in other comprehensive income, assets | (1.3) | (2.9) | |
Net purchases, sales, issuances and settlements, assets | (41) | (10.5) | 5.8 |
Transfers into Level 3, assets | 10 | ||
Ending balance, assets | 2.1 | 31.9 | 39 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | 12.5 | 5.3 | 6 |
Changes in unrealized gains (losses) included in OCI relating to positions still held, assets | (1.3) | (2.9) | |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 0.5 | 10.7 | |
Sales, assets | (41) | (11) | (4.9) |
Net purchases, sales, issuances and settlements, assets | (41) | (10.5) | 5.8 |
Separate account assets | |||
Changes in Level 3 fair value measurements rollforward, assets and liabilities | |||
Beginning balance, assets | 8,893.2 | 8,968 | 8,615.5 |
Total realized/unrealized gains (losses) included in net income, assets | 313.1 | 463.7 | 739.9 |
Net purchases, sales, issuances and settlements, assets | (8,261) | (538.5) | (214.2) |
Transfers out of Level 3, assets | (173.2) | ||
Ending balance, assets | 945.3 | 8,893.2 | 8,968 |
Changes in unrealized gains (losses) included in net income relating to positions still held, assets | 90.5 | 385.5 | 697.1 |
Gross purchases, sales, issuances and settlements | |||
Purchases, assets | 38.5 | 309.2 | 279.1 |
Sales, assets | (8,206.2) | (658.2) | (526.4) |
Issuances, assets | (191.5) | (396.1) | (280.4) |
Settlements, assets | 98.2 | 206.6 | 313.5 |
Net purchases, sales, issuances and settlements, assets | $ (8,261) | $ (538.5) | $ (214.2) |
Fair Value Measurements - Trans
Fair Value Measurements - Transfers (Details) - Recurring Fair Value Measurements - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 3 into Level 2, net derivative assets (liabilities) | $ 26.5 | ||
Other investments | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | $ 10 | ||
Fixed maturities, trading | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 3 into Level 2 | 0.3 | ||
Separate account assets | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 3 into Level 2 | 173.2 | ||
Available-for-sale | Fixed maturities | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | $ 352.9 | 388.4 | 86 |
Transfers out of Level 3 into Level 2 | 460.8 | 654.7 | 78.6 |
Available-for-sale | States and political subdivisions | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | 82.4 | ||
Available-for-sale | Corporate debt securities | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | 175.8 | 342 | 4.1 |
Transfers out of Level 3 into Level 2 | 255.2 | ||
Available-for-sale | Commercial mortgage-backed securities | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | 0.3 | 3.7 | |
Transfers out of Level 3 into Level 2 | 2.3 | ||
Available-for-sale | Collateralized debt obligations | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | 74.1 | 69.9 | |
Transfers out of Level 3 into Level 2 | 435.8 | 330.6 | |
Available-for-sale | Other debt obligations | |||
Fair Value Hierarchy Levels Transfers | |||
Transfers out of Level 2 into Level 3 | 20.6 | 46.1 | 8.3 |
Transfers out of Level 3 into Level 2 | $ 25 | $ 68.9 | $ 76.3 |
Fair Value Measurements - Quant
Fair Value Measurements - Quantitative Information for Level 3 Measurements (Details) - Recurring Fair Value Measurements $ in Millions | Dec. 31, 2021USD ($)item | Dec. 31, 2020USD ($)item |
Unobservable inputs | ||
Assets measured at fair value | $ | $ 265,620.4 | $ 259,883.4 |
Liabilities measured at fair value | $ | (583) | (654.3) |
Fair value hierarchy Level 3 | ||
Unobservable inputs | ||
Assets measured at fair value | $ | 2,029.1 | 9,286.1 |
Liabilities measured at fair value | $ | (356.9) | (473.5) |
Fair value hierarchy Level 3 | Investment and universal life contracts | ||
Unobservable inputs | ||
Liabilities measured at fair value | $ | $ (356.3) | $ (467.8) |
Embedded derivative, Valuation technique | Discounted cash flow | Discounted cash flow |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long duration interest rate | Minimum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.018 | 0.012 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long duration interest rate | Maximum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.019 | 0.014 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long duration interest rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.013 | |
Embedded derivative, Input | 0.019 | |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long-term equity market volatility | Minimum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.180 | 0.176 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long-term equity market volatility | Maximum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.325 | 0.269 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Long-term equity market volatility | Weighted average input | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.221 | 0.196 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Non-performance risk | Minimum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.003 | 0.001 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Non-performance risk | Maximum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.011 | 0.014 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Non-performance risk | Weighted average input | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.009 | 0.009 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Lapse rate | Minimum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0 | 0 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Lapse rate | Maximum | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.170 | 0.160 |
Fair value hierarchy Level 3 | Investment and universal life contracts | Discounted cash flow | Lapse rate | Weighted average input | ||
Unobservable inputs | ||
Embedded derivative, Input | 0.051 | 0.058 |
Fair value hierarchy Level 3 | Fixed maturities | Trading | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 4.9 | |
Fair value hierarchy Level 3 | Fixed maturities | Trading | Discounted cash flow | Discount rate | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 7.5 | |
Fair value hierarchy Level 3 | Fixed maturities | Trading | Discounted cash flow | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 7.5 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 829.9 | $ 286.1 |
Fixed maturities, available-for-sale, Valuation technique | Discounted cash flow | Discounted cash flow |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Discount rate | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.009 | 0.009 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Discount rate | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.155 | 0.117 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.068 | 0.073 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Illiquidity premium | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0 | 0 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Illiquidity premium | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0070 | 0.0060 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Illiquidity premium | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0006 | 0.0019 |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Comparability adjustment | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Comparability adjustment | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0769 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Comparability adjustment | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0359 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Probability of default | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Probability of default | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Potential loss severity | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.546 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Discounted cash flow | Potential loss severity | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.546 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Market comparables | Probability of default | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Market comparables | Probability of default | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Market comparables | Potential loss severity | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.394 | |
Fair value hierarchy Level 3 | Corporate debt securities | Available-for-sale | Market comparables | Potential loss severity | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.394 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 3.5 | $ 1.1 |
Fixed maturities, available-for-sale, Valuation technique | Discounted cash flow | Discounted cash flow |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Discount rate | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.037 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.037 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Probability of default | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Probability of default | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Potential loss severity | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.784 | |
Fair value hierarchy Level 3 | Commercial mortgage-backed securities | Available-for-sale | Discounted cash flow | Potential loss severity | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.784 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 45.9 | $ 0.7 |
Fixed maturities, available-for-sale, Valuation technique | Discounted cash flow | Discounted cash flow |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.030 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.053 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.040 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0385 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0255 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Probability of default | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Probability of default | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 1 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Potential loss severity | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.405 | |
Fair value hierarchy Level 3 | Collateralized debt obligations | Available-for-sale | Discounted cash flow | Potential loss severity | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.405 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 22.1 | $ 0.8 |
Fixed maturities, available-for-sale, Valuation technique | Discounted cash flow | Discounted cash flow |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Discount rate | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.100 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.030 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.100 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.033 | 0.100 |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0500 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Minimum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0225 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Maximum | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0500 | |
Fair value hierarchy Level 3 | Other debt obligations | Available-for-sale | Discounted cash flow | Illiquidity premium | Weighted average input | ||
Unobservable inputs | ||
Fixed maturities, available-for-sale, Input | 0.0237 | 0.0500 |
Fair value hierarchy Level 3 | Other investments | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 0.6 | $ 30.4 |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Discount rate | Minimum | ||
Unobservable inputs | ||
Other investments, Input | 0.250 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Discount rate | Maximum | ||
Unobservable inputs | ||
Other investments, Input | 0.300 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.275 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Terminal earnings before interest, taxes, depreciation and amortization multiple | Minimum | ||
Unobservable inputs | ||
Other investments, Input | 3.8 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Terminal earnings before interest, taxes, depreciation and amortization multiple | Maximum | ||
Unobservable inputs | ||
Other investments, Input | 4.7 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, other investments | Terminal earnings before interest, taxes, depreciation and amortization multiple | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 4.2 | |
Fair value hierarchy Level 3 | Other investments | Market comparables | Revenue multiples | Minimum | ||
Unobservable inputs | ||
Other investments, Input | 6.8 | 6 |
Fair value hierarchy Level 3 | Other investments | Market comparables | Revenue multiples | Maximum | ||
Unobservable inputs | ||
Other investments, Input | 9.1 | 8 |
Fair value hierarchy Level 3 | Other investments | Market comparables | Revenue multiples | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 8 | 7 |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Discount rate | ||
Unobservable inputs | ||
Other investments, Input | 0.065 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.065 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Terminal capitalization rate | ||
Unobservable inputs | ||
Other investments, Input | 0.053 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Terminal capitalization rate | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.053 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Average market rent growth rate | ||
Unobservable inputs | ||
Other investments, Input | 0.026 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate | Average market rent growth rate | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.026 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate debt | Credit spread rate | ||
Unobservable inputs | ||
Other investments, Input | 0.033 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate debt | Credit spread rate | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.033 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate debt | Loan to value | ||
Unobservable inputs | ||
Other investments, Input | 0.526 | |
Fair value hierarchy Level 3 | Other investments | Discounted cash flow, real estate debt | Loan to value | Weighted average input | ||
Unobservable inputs | ||
Other investments, Input | 0.526 | |
Fair value hierarchy Level 3 | Separate account assets | ||
Unobservable inputs | ||
Assets measured at fair value | $ | $ 946 | $ 8,893.2 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Discount rate | ||
Unobservable inputs | ||
Separate account assets, Input | 0.014 | 0.012 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.014 | 0.012 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Illiquidity premium | ||
Unobservable inputs | ||
Separate account assets, Input | 0.0060 | |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Illiquidity premium | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.0060 | |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Credit spread rate | ||
Unobservable inputs | ||
Separate account assets, Input | 0.0120 | 0.0110 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, mortgage loans | Credit spread rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.0120 | 0.0110 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Discount rate | Minimum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.053 | 0.056 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Discount rate | Maximum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.100 | 0.119 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Discount rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.066 | 0.069 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Terminal capitalization rate | Minimum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.043 | 0.045 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Terminal capitalization rate | Maximum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.093 | 0.093 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Terminal capitalization rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.056 | 0.057 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Average market rent growth rate | Minimum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.016 | 0.015 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Average market rent growth rate | Maximum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.036 | 0.048 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate | Average market rent growth rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.027 | 0.030 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Loan to value | Minimum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.401 | 0.063 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Loan to value | Maximum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.585 | 0.742 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Loan to value | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.460 | 0.475 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Market interest rate | Minimum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.025 | 0.020 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Market interest rate | Maximum | ||
Unobservable inputs | ||
Separate account assets, Input | 0.031 | 0.050 |
Fair value hierarchy Level 3 | Separate account assets | Discounted cash flow, real estate debt | Market interest rate | Weighted average input | ||
Unobservable inputs | ||
Separate account assets, Input | 0.027 | 0.034 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Option on Consolidated VIEs and Equity Method Investments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Commercial Mortgage Loans of Consolidated VIEs | |||
Fair Value Option, Quantitative Disclosures | |||
Pre-tax gain (loss) due to change in fair value of assets and liabilities for which the fair value option was elected | $ 0.1 | ||
Interest income | 0.3 | ||
Real Estate Ventures | |||
Fair Value Option, Quantitative Disclosures | |||
Fair value of assets for which fair value option was elected | $ 28.5 | ||
Pre-tax gain (loss) due to change in fair value of assets and liabilities for which the fair value option was elected | $ 12.5 | $ 5.3 | $ 6 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Instruments Not Reported at Fair Value (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Assets (liabilities) | ||
Mortgage loans | $ 19,668.7 | $ 17,343 |
Policy loans | 759.6 | 784 |
Short-term debt | (79.8) | (84.7) |
Long-term debt | (4,280.2) | (4,279.2) |
Carrying amount | ||
Assets (liabilities) | ||
Mortgage loans | 19,668.7 | 17,343 |
Policy loans | 759.6 | 784 |
Other investments | 304 | 347.2 |
Cash and cash equivalents not required to be reported at fair value | 1,214.2 | 1,383.4 |
Investment contracts | (35,810.4) | (35,449.9) |
Short-term debt | (79.8) | (84.7) |
Long-term debt | (4,280.2) | (4,279.2) |
Separate account liabilities | (165,098.7) | (160,316.4) |
Bank deposits | (373.3) | (423.5) |
Cash collateral payable | (214.9) | (224.6) |
Assets (liabilities) measured at fair value | ||
Assets (liabilities) | ||
Mortgage loans | 20,602.7 | 18,762.6 |
Policy loans | 952.9 | 1,037.7 |
Other investments | 294.8 | 338.5 |
Cash and cash equivalents not required to be reported at fair value | 1,214.2 | 1,383.4 |
Investment contracts | (36,088.6) | (36,738.7) |
Short-term debt | (79.8) | (84.7) |
Long-term debt | (4,793.1) | (4,949.9) |
Separate account liabilities | (164,028.9) | (159,129.2) |
Bank deposits | (372.8) | (429.7) |
Cash collateral payable | (214.9) | (224.6) |
Assets (liabilities) measured at fair value | Fair value hierarchy Level 1 | ||
Assets (liabilities) | ||
Cash and cash equivalents not required to be reported at fair value | 1,197.8 | 1,369.7 |
Cash collateral payable | (214.9) | (224.6) |
Assets (liabilities) measured at fair value | Fair value hierarchy Level 2 | ||
Assets (liabilities) | ||
Other investments | 198.6 | 247.1 |
Cash and cash equivalents not required to be reported at fair value | 16.4 | 13.7 |
Investment contracts | (7,454.3) | (5,276.9) |
Short-term debt | (79.8) | (84.7) |
Long-term debt | (4,755.1) | (4,908.7) |
Bank deposits | (372.8) | (429.7) |
Assets (liabilities) measured at fair value | Fair value hierarchy Level 3 | ||
Assets (liabilities) | ||
Mortgage loans | 20,602.7 | 18,762.6 |
Policy loans | 952.9 | 1,037.7 |
Other investments | 96.2 | 91.4 |
Investment contracts | (28,634.3) | (31,461.8) |
Long-term debt | (38) | (41.2) |
Separate account liabilities | $ (164,028.9) | $ (159,129.2) |
Statutory Insurance Financial_3
Statutory Insurance Financial Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Statutory disclosures | |||
Statutory reserves assumed by affiliated reinsurance subsidiaries | $ 10,085.7 | $ 8,978.2 | |
Admitted assets under prescribed and permitted statutory accounting practices | 4,146 | 3,731 | |
Statutory net income | 864 | 915.9 | $ 989.3 |
Statutory capital and surplus | $ 5,375.2 | $ 5,682.4 | $ 5,193.4 |
Segment Information - Reconcili
Segment Information - Reconciliation of Segment Assets to Consolidated (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Segment Information: Assets | ||
Total assets | $ 304,657.2 | $ 296,627.7 |
Retirement and Income Solutions | ||
Segment Information: Assets | ||
Total assets | 221,993.8 | 207,288.4 |
Principal Global Investors | ||
Segment Information: Assets | ||
Total assets | 2,445.1 | 2,294.3 |
Principal International | ||
Segment Information: Assets | ||
Total assets | 42,812.4 | 51,707.6 |
U.S. Insurance Solutions | ||
Segment Information: Assets | ||
Total assets | 33,222.6 | 31,438.9 |
Corporate | ||
Segment Information: Assets | ||
Total assets | $ 4,183.3 | $ 3,898.5 |
Segment Information - Reconci_2
Segment Information - Reconciliation of Segment Operating Revenues and Earnings to Consolidated (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Net realized capital gains (losses), net of related revenue adjustments | $ (164) | $ 195.3 | $ (98.5) |
Total revenues | 14,262.7 | 14,741.7 | 16,222.1 |
Pre-tax net realized capital gains (losses), as adjusted | (179.8) | 63.6 | (140.9) |
Income before income taxes | 2,083.6 | 1,693.5 | 1,693.3 |
Retirement and Income Solutions | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Inter-segment revenues | 413.1 | 342.6 | 357.8 |
Principal Global Investors | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Inter-segment revenues | 308.9 | 273.8 | 264.9 |
Operating Segments | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 14,458.2 | 14,579.9 | 16,393.1 |
Pre-tax operating earnings (losses) | 2,261.4 | 1,636.9 | 1,889.3 |
Operating Segments | Retirement and Income Solutions | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 6,510 | 7,503.5 | 8,954.4 |
Pre-tax operating earnings (losses) | 1,141.2 | 966.9 | 874 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Fee | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 2,322.7 | 2,149.8 | 2,003 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Spread | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 4,187.3 | 5,353.7 | 6,951.4 |
Operating Segments | Principal Global Investors | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 1,828 | 1,539.1 | 1,505.8 |
Pre-tax operating earnings (losses) | 708.4 | 512.9 | 483.3 |
Operating Segments | Principal International | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 1,351.8 | 1,096.8 | 1,523.2 |
Pre-tax operating earnings (losses) | 309 | 243.6 | 390.7 |
Operating Segments | U.S. Insurance Solutions | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 4,766.6 | 4,480.2 | 4,449 |
Pre-tax operating earnings (losses) | 470.8 | 239.9 | 521.6 |
Operating Segments | U.S. Insurance Solutions | Specialty Benefits insurance | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 2,709.6 | 2,525.4 | 2,493.6 |
Operating Segments | U.S. Insurance Solutions | Individual Life insurance | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 2,057.2 | 1,955 | 1,955.6 |
Operating Segments | U.S. Insurance Solutions | Eliminations | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | (0.2) | (0.2) | (0.2) |
Operating Segments | Corporate | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Operating revenues | 1.8 | (39.7) | (39.3) |
Pre-tax operating earnings (losses) | (368) | (326.4) | (380.3) |
Reconciling Items | |||
Operating Revenue And Profit (Loss) From Segments To Consolidated | |||
Net realized capital gains (losses), net of related revenue adjustments | (164) | 195.3 | (98.5) |
Adjustments related to equity method investments | (31.5) | (33.5) | (72.5) |
Pre-tax net realized capital gains (losses), as adjusted | (179.8) | 63.6 | (140.9) |
Earnings adjustments related to equity method investments and noncontrolling interest | $ 2 | $ (7) | $ (55.1) |
Segment Information - Net Reali
Segment Information - Net Realized Capital Gains (Losses) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Information: Net realized capital gains (losses), as adjusted | |||
Net realized capital gains (losses) | $ 2.5 | $ 302.6 | $ (52.8) |
Derivative and hedging-related revenue adjustments | (160.3) | (132.9) | (80.4) |
Market value adjustments to fee revenues | (0.6) | (1.6) | |
Adjustments related to equity method investments | (24) | (1.5) | 2.6 |
Adjustments related to sponsored investment funds | 21.3 | 17.3 | 23.6 |
Recognition of front-end fee revenue | (2.9) | 11.4 | 8.5 |
Net realized capital gains (losses), net of related revenue adjustments | (164) | 195.3 | (98.5) |
Amortization of deferred acquisition costs and other actuarial balances | 11.1 | (26.8) | (40.8) |
Capital (gains) losses distributed | (106.7) | (49.9) | (68.2) |
Market value adjustments of embedded derivatives | 79.8 | (55) | 66.6 |
Pre-tax net realized capital gains (losses), as adjusted | $ (179.8) | $ 63.6 | $ (140.9) |
Segment Information - Income Ta
Segment Information - Income Tax Expense by Segment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Information: Income tax expense (benefit) | |||
Income taxes (benefits) | $ 326.2 | $ 265 | $ 249.2 |
Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | 413.8 | 270.5 | 320.2 |
Reconciling Items | |||
Segment Information: Income tax expense (benefit) | |||
Tax expense (benefit) related to net realized capital gains (losses), as adjusted | (56.2) | 28.2 | 1.3 |
Tax expense (benefit) associated with certain adjustments related to equity method investments and noncontrolling interest | (31.4) | (33.7) | (72.3) |
Retirement and Income Solutions | Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | 130.1 | 106.6 | 71.8 |
Principal Global Investors | Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | 192.3 | 141.9 | 121.8 |
Principal International | Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | 69.8 | 62 | 106.8 |
U.S. Insurance Solutions | Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | 92.3 | 47.9 | 101.8 |
Corporate | Operating Segments | |||
Segment Information: Income tax expense (benefit) | |||
Total segment income tax expense (benefit) from operating earnings (losses) | $ (70.7) | $ (87.9) | $ (82) |
Segment Information - Depreciat
Segment Information - Depreciation and Amortization Expense by Segment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | $ 208 | $ 186.6 | $ 166.8 |
Retirement and Income Solutions | |||
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | 81.7 | 69.1 | 48.2 |
Principal Global Investors | |||
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | 21.1 | 21.6 | 18.9 |
Principal International | |||
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | 57.3 | 56 | 58.6 |
U.S. Insurance Solutions | |||
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | 24.2 | 25.1 | 25 |
Corporate | |||
Segment Information: Depreciation and amortization expense | |||
Depreciation and amortization expense | $ 23.7 | $ 14.8 | $ 16.1 |
Revenues from Contracts with _3
Revenues from Contracts with Customers - Disaggregation by Segment (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total fees and other revenues per consolidated statements of operations | $ 5,012.6 | $ 4,511.1 | $ 4,409.9 |
Operating Segments | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 3,150.1 | 2,768.3 | 2,610 |
Operating Segments | Retirement and Income Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 590.1 | 599.8 | 464.8 |
Operating Segments | Principal Global Investors | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 1,787.9 | 1,511.2 | 1,456.7 |
Fees and other revenues not within the scope of revenue recognition guidance | 36.2 | 22.3 | 38.5 |
Total fees and other revenues per consolidated statements of operations | 1,824.1 | 1,533.5 | 1,495.2 |
Operating Segments | Principal International | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 492.7 | 439.2 | 462.2 |
Fees and other revenues not within the scope of revenue recognition guidance | 4.1 | 5.6 | 6.3 |
Total fees and other revenues per consolidated statements of operations | 496.8 | 444.8 | 468.5 |
Operating Segments | U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 75.3 | 63.2 | 65.9 |
Operating Segments | Corporate | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 204.1 | 154.9 | 160.4 |
Fees and other revenues not within the scope of revenue recognition guidance | (360) | (303.9) | (301.8) |
Total fees and other revenues per consolidated statements of operations | (155.9) | (149) | (141.4) |
Operating Segments | Retirement and Income Solutions - Fee | Retirement and Income Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 580.2 | 591.2 | 455.5 |
Fees and other revenues not within the scope of revenue recognition guidance | 1,299.6 | 1,130.4 | 1,139 |
Total fees and other revenues per consolidated statements of operations | 1,879.8 | 1,721.6 | 1,594.5 |
Operating Segments | Retirement and Income Solutions - Spread | Retirement and Income Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 9.9 | 8.6 | 9.3 |
Fees and other revenues not within the scope of revenue recognition guidance | 7.9 | 9.5 | 13.9 |
Total fees and other revenues per consolidated statements of operations | 17.8 | 18.1 | 23.2 |
Operating Segments | Specialty Benefits insurance | U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 14.9 | 14.8 | 14.9 |
Fees and other revenues not within the scope of revenue recognition guidance | 19 | 19.3 | 19.6 |
Total fees and other revenues per consolidated statements of operations | 33.9 | 34.1 | 34.5 |
Operating Segments | Individual Life insurance | U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | 60.6 | 48.6 | 51.2 |
Fees and other revenues not within the scope of revenue recognition guidance | 859.2 | 849.8 | 875.9 |
Total fees and other revenues per consolidated statements of operations | 919.8 | 898.4 | 927.1 |
Operating Segments | U.S. Insurance Solutions Eliminations | U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total segment revenue from contracts with customers | (0.2) | (0.2) | (0.2) |
Reconciling Items | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Fees and other revenues not within the scope of revenue recognition guidance | 1,866 | 1,733 | 1,791.4 |
Pre-tax other adjustments | $ (3.5) | $ 9.8 | $ 8.5 |
Revenues from Contracts with _4
Revenues from Contracts with Customers - Disaggregation within Segments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total fees and other revenues | $ 5,012.6 | $ 4,511.1 | $ 4,409.9 |
Premiums and other considerations | 4,841.5 | 6,037.4 | 7,866.6 |
Net investment income (loss) | 4,406.1 | 3,890.6 | 3,998.4 |
Retirement and Income Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Premiums and other considerations | 1,883.6 | 3,221 | 4,862.7 |
Net investment income (loss) | 2,674.4 | 2,457.9 | 2,420.4 |
Principal Global Investors | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Net investment income (loss) | 3.9 | 5.6 | 10.1 |
Principal International | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Premiums and other considerations | 127.5 | 156.6 | 393.3 |
Net investment income (loss) | 631.1 | 446.8 | 575.9 |
U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Premiums and other considerations | 2,830.4 | 2,659.8 | 2,610.6 |
Net investment income (loss) | 917.1 | 850.6 | 854.5 |
Corporate | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Net investment income (loss) | 179.6 | 129.7 | 137.5 |
Operating Segments | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 3,150.1 | 2,768.3 | 2,610 |
Total operating revenues | 14,458.2 | 14,579.9 | 16,393.1 |
Operating Segments | Retirement and Income Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 590.1 | 599.8 | 464.8 |
Total operating revenues | 6,510 | 7,503.5 | 8,954.4 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Fee | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 580.2 | 591.2 | 455.5 |
Fees and other revenues not within the scope of revenue recognition guidance | 1,299.6 | 1,130.4 | 1,139 |
Total fees and other revenues | 1,879.8 | 1,721.6 | 1,594.5 |
Premiums and other considerations | 0.5 | 5 | 3.5 |
Net investment income (loss) | 442.4 | 423.2 | 405 |
Total operating revenues | 2,322.7 | 2,149.8 | 2,003 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Fee | Administrative service fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 576.7 | 589.2 | 453.7 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Fee | Other fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 3.5 | 2 | 1.8 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Spread | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 9.9 | 8.6 | 9.3 |
Fees and other revenues not within the scope of revenue recognition guidance | 7.9 | 9.5 | 13.9 |
Total fees and other revenues | 17.8 | 18.1 | 23.2 |
Premiums and other considerations | 1,883.1 | 3,216 | 4,859.2 |
Net investment income (loss) | 2,286.4 | 2,119.6 | 2,069 |
Total operating revenues | 4,187.3 | 5,353.7 | 6,951.4 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Spread | Deposit account fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 9.2 | 8.4 | 9.3 |
Operating Segments | Retirement and Income Solutions | Retirement and Income Solutions - Spread | Commission income | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 0.7 | 0.2 | |
Operating Segments | Principal Global Investors | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 1,787.9 | 1,511.2 | 1,456.7 |
Fees and other revenues not within the scope of revenue recognition guidance | 36.2 | 22.3 | 38.5 |
Total fees and other revenues | 1,824.1 | 1,533.5 | 1,495.2 |
Net investment income (loss) | 3.9 | 5.6 | 10.6 |
Total operating revenues | 1,828 | 1,539.1 | 1,505.8 |
Operating Segments | Principal Global Investors | Management fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 1,514.1 | 1,298.4 | 1,239.1 |
Operating Segments | Principal Global Investors | Other fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 273.8 | 212.8 | 217.6 |
Operating Segments | Principal International | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 492.7 | 439.2 | 462.2 |
Fees and other revenues not within the scope of revenue recognition guidance | 4.1 | 5.6 | 6.3 |
Total fees and other revenues | 496.8 | 444.8 | 468.5 |
Premiums and other considerations | 127.5 | 156.6 | 393.3 |
Net investment income (loss) | 727.5 | 495.4 | 661.4 |
Total operating revenues | 1,351.8 | 1,096.8 | 1,523.2 |
Operating Segments | Principal International | Latin America | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 362.6 | 323.5 | 351.5 |
Operating Segments | Principal International | Asia | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 128.8 | 115.9 | 111 |
Operating Segments | Principal International | Principal International Corporate / Regional Office | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 2.6 | 0.9 | 0.9 |
Operating Segments | Principal International | Geographical Eliminations | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | (1.3) | (1.1) | (1.2) |
Operating Segments | Principal International | Management fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 484.4 | 435.3 | 459.3 |
Operating Segments | Principal International | Other fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 8.3 | 3.9 | 2.9 |
Operating Segments | U.S. Insurance Solutions | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 75.3 | 63.2 | 65.9 |
Total operating revenues | 4,766.6 | 4,480.2 | 4,449 |
Operating Segments | U.S. Insurance Solutions | Specialty Benefits insurance | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 14.9 | 14.8 | 14.9 |
Fees and other revenues not within the scope of revenue recognition guidance | 19 | 19.3 | 19.6 |
Total fees and other revenues | 33.9 | 34.1 | 34.5 |
Premiums and other considerations | 2,496.4 | 2,330.7 | 2,292.7 |
Net investment income (loss) | 179.3 | 160.6 | 166.4 |
Total operating revenues | 2,709.6 | 2,525.4 | 2,493.6 |
Operating Segments | U.S. Insurance Solutions | Specialty Benefits insurance | Administrative service fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 14.9 | 14.8 | 14.9 |
Operating Segments | U.S. Insurance Solutions | Individual Life insurance | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 60.6 | 48.6 | 51.2 |
Fees and other revenues not within the scope of revenue recognition guidance | 859.2 | 849.8 | 875.9 |
Total fees and other revenues | 919.8 | 898.4 | 927.1 |
Premiums and other considerations | 334 | 329.1 | 317.9 |
Net investment income (loss) | 803.4 | 727.5 | 710.6 |
Total operating revenues | 2,057.2 | 1,955 | 1,955.6 |
Operating Segments | U.S. Insurance Solutions | Individual Life insurance | Administrative service fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 26.7 | 21.8 | 24.3 |
Operating Segments | U.S. Insurance Solutions | Individual Life insurance | Commission income | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 33.9 | 26.8 | 26.9 |
Operating Segments | Corporate | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 204.1 | 154.9 | 160.4 |
Fees and other revenues not within the scope of revenue recognition guidance | (360) | (303.9) | (301.8) |
Total fees and other revenues | (155.9) | (149) | (141.4) |
Net investment income (loss) | 157.7 | 109.3 | 102.1 |
Total operating revenues | 1.8 | (39.7) | (39.3) |
Operating Segments | Corporate | Other fee revenue | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 68.8 | 59.1 | 46.1 |
Operating Segments | Corporate | Commission income | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | 388.9 | 316.6 | 320.2 |
Operating Segments | Corporate | Revenue by type - Eliminations | |||
Revenues from Contracts with Customers - Disaggregation of Revenues | |||
Total revenues from contracts with customers | $ (253.6) | $ (220.8) | $ (205.9) |
Revenues from Contracts with _5
Revenues from Contracts with Customers - Contract Costs (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Contract costs | |||
Contract cost asset | $ 193.1 | $ 173 | |
Practical expedient, incremental costs of obtaining a contract | true | ||
Impairment loss for contract cost asset | $ 0 | 0 | $ 0 |
Amortization expense of contract cost asset | $ 32.4 | $ 24.8 | $ 24.4 |
Stock-Based Compensation Plan_2
Stock-Based Compensation Plans - Stock-Based Awards (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | May 20, 2014 | |
Stock-Based Compensation Plans | ||||
Stock-Based Compensation Plans - Disclosures | ||||
Compensation cost | $ 95.2 | $ 86.7 | $ 78.7 | |
Related income tax benefit | 19.9 | 17.1 | 16.8 | |
Capitalized as part of an asset | $ 1.4 | $ 1.5 | $ 1.7 | |
2020 Directors Stock Plan, the 2014 Stock Incentive Plan, the 2014 Directors Stock Plan, the Amended and Restated 2010 Stock Incentive Plan, the 2005 Directors Stock Plan, the Stock Incentive Plan or the Directors Stock Plan | ||||
Stock-Based Compensation Plans - Disclosures | ||||
Number of shares that will be granted | 0 | |||
2021 Stock Incentive Plan | ||||
Stock-Based Compensation Plans - Disclosures | ||||
Maximum number of new shares of common stock available for grant (in shares) | 24.4 |
Stock-Based Compensation Plan_3
Stock-Based Compensation Plans - Nonqualified Stock Options, Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
2014 Stock Incentive Plan, Amended and Restated 2010 Stock Incentive Plan and Stock Incentive Plan | |||
Stock-Based Compensation Plans - Disclosures | |||
Option expiration period | 10 years | ||
Vesting period | 3 years | ||
Change in options outstanding | |||
Options granted (in shares) | 0.8 | 1.4 | 1.2 |
Nonqualified Stock Options | |||
Change in options outstanding | |||
Options outstanding at beginning of period (in shares) | 6.5 | ||
Options granted (in shares) | 0.8 | ||
Options exercised (in shares) | 1 | ||
Options canceled (in shares) | 0.1 | ||
Options outstanding at end of period (in shares) | 6.2 | 6.5 | |
Options vested or expected to vest at end of period (in shares) | 6.2 | ||
Options exercisable at end of period (in shares) | 4.6 | ||
Options outstanding at beginning of period, Weighted-average exercise price (in dollars per share) | $ 49.52 | ||
Options granted, Weighted-average exercise price (in dollars per share) | 58.68 | ||
Options exercised, Weighted-average exercise price (in dollars per share) | 41.92 | ||
Options canceled weighted-average exercise price (in dollars per share) | 56.93 | ||
Options outstanding at end of period, Weighted-average exercise price (in dollars per share) | 51.89 | $ 49.52 | |
Options vested or expected to vest at end of period, Weighted-average exercise price (in dollars per share) | 51.88 | ||
Options exercisable at end of period, Weighted-average exercise price (in dollars per share) | $ 50.76 | ||
Options outstanding at end of period, Intrinsic value | $ 126.9 | ||
Options vested or expected to vest at end of period, Intrinsic value | 126.7 | ||
Options exercisable at end of period, Intrinsic value | 99.2 | ||
Total intrinsic value of options exercised | $ 23.5 | $ 3.4 | $ 2.4 |
Stock-Based Compensation Plan_4
Stock-Based Compensation Plans - Nonqualified Stock Options, Range of Exercise Prices (Details) - Nonqualified Stock Options - $ / shares shares in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Number of options outstanding (in shares) | 6.2 | 6.5 |
Weighted-average remaining contractual life for stock options exercisable | 6 years | |
Range of exercise prices, Range 1 | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 27.46 | |
Upper limit of exercise price range (in dollars per share) | $ 48.11 | |
Number of options outstanding (in shares) | 1.4 | |
Weighted-average remaining contractual life | 2 years 6 months | |
Range of exercise prices, Range 2 | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 48.12 | |
Upper limit of exercise price range (in dollars per share) | $ 52.41 | |
Number of options outstanding (in shares) | 1.6 | |
Weighted-average remaining contractual life | 7 years | |
Range of exercise prices, Range 3 | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 52.42 | |
Upper limit of exercise price range (in dollars per share) | $ 55.89 | |
Number of options outstanding (in shares) | 1.1 | |
Weighted-average remaining contractual life | 7 years 2 months 12 days | |
Range of exercise prices, Range 4 | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 55.90 | |
Upper limit of exercise price range (in dollars per share) | $ 62.75 | |
Number of options outstanding (in shares) | 0.8 | |
Weighted-average remaining contractual life | 9 years 1 month 6 days | |
Range of exercise prices, Range 5 | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 62.76 | |
Upper limit of exercise price range (in dollars per share) | $ 63.98 | |
Number of options outstanding (in shares) | 1.3 | |
Weighted-average remaining contractual life | 5 years 8 months 12 days | |
Range of exercise prices, Total Range | ||
Summary of weighted-average remaining contractual lives for stock options outstanding and range of exercise prices | ||
Lower limit of exercise price range (in dollars per share) | $ 27.46 | |
Upper limit of exercise price range (in dollars per share) | $ 63.98 | |
Number of options outstanding (in shares) | 6.2 |
Stock-Based Compensation Plan_5
Stock-Based Compensation Plans - Nonqualified Stock Options, Assumptions and Other Disclosures (Details) - Nonqualified Stock Options - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Stock-Based Compensation Plans - Disclosures | |||
Options granted (in shares) | 0.8 | ||
Assumptions used to estimate fair value of stock options granted during period | |||
Weighted-average expected volatility (as a percent) | 34.20% | 25.70% | 23.30% |
Weighted-average expected term | 7 years | 7 years | 7 years |
Weighted-average risk-free interest rate (as a percent) | 1.20% | 1.30% | 2.60% |
Weighted-average expected dividend yield (as a percent) | 3.82% | 4.33% | 4.07% |
Weighted-average estimated fair value of stock options granted (in dollars per share) | $ 15.67 | $ 9.64 | $ 10 |
Other nonqualified stock option disclosures | |||
Unrecognized compensation costs | $ 3 | ||
Weighted-average service period over which unrecognized compensation costs will be recognized | 1 year 9 months 18 days | ||
Cash received from stock options exercised | $ 42.2 | $ 4.4 | $ 3.4 |
Tax benefits realized for the tax deductions from options exercised | $ 9.1 | $ 1.4 | $ 0.5 |
Stock-Based Compensation Plan_6
Stock-Based Compensation Plans - Performance Share Awards and Restricted Stock Units (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Performance Share Awards | |||
Stock-Based Compensation Plans - Disclosures | |||
Performance period for goals | 3 years | ||
Change in nonvested units outstanding | |||
Awards or units outstanding at beginning of period (in shares) | 0.7 | ||
Awards or units granted (in shares) | 0.2 | 0.3 | 0.2 |
Awards or units vested (in shares) | 0.1 | ||
Awards or units canceled (in shares) | 0.1 | ||
Awards or units outstanding at end of period (in shares) | 0.7 | 0.7 | |
Awards or units outstanding at beginning of period, Weighted-average grant-date fair value (in dollars per share) | $ 55.28 | ||
Awards or units granted, Weighted-average grant-date fair value (in dollars per share) | 58.68 | $ 51.73 | $ 53.09 |
Awards or units vested, Weighted-average grant-date fair value (in dollars per share) | 63.98 | ||
Awards or units canceled, Weighted-average grant-date fair value (in dollars per share) | 62.16 | ||
Awards or units outstanding at end of period, Weighted-average grant-date fair value (in dollars per share) | $ 54.37 | $ 55.28 | |
Other award and unit disclosures | |||
Intrinsic value from awards or units vested | $ 4.7 | $ 8.7 | $ 17.6 |
Lower limit multiple of initial target awards (as a percent) | 0.00% | ||
Upper limit multiple of initial target awards (as a percent) | 150.00% | ||
Unrecognized compensation costs | $ 5.9 | ||
Weighted-average service period over which unrecognized compensation costs will be recognized | 1 year 8 months 12 days | ||
Tax benefits realized for the tax deductions from awards or units paid out | $ 1.8 | $ 3 | $ 3.3 |
Restricted Stock Units | |||
Change in nonvested units outstanding | |||
Awards or units outstanding at beginning of period (in shares) | 2.8 | ||
Awards or units granted (in shares) | 1.1 | 1.1 | 1.1 |
Awards or units vested (in shares) | 0.8 | ||
Awards or units canceled (in shares) | 0.1 | ||
Awards or units outstanding at end of period (in shares) | 3 | 2.8 | |
Awards or units outstanding at beginning of period, Weighted-average grant-date fair value (in dollars per share) | $ 54.86 | ||
Awards or units granted, Weighted-average grant-date fair value (in dollars per share) | 59.17 | $ 50.49 | $ 53.17 |
Awards or units vested, Weighted-average grant-date fair value (in dollars per share) | 62.01 | ||
Awards or units canceled, Weighted-average grant-date fair value (in dollars per share) | 55.50 | ||
Awards or units outstanding at end of period, Weighted-average grant-date fair value (in dollars per share) | $ 54.50 | $ 54.86 | |
Other award and unit disclosures | |||
Intrinsic value from awards or units vested | $ 51.7 | $ 41.2 | $ 64 |
Unrecognized compensation costs | $ 52 | ||
Weighted-average service period over which unrecognized compensation costs will be recognized | 1 year 8 months 12 days | ||
Tax benefits realized for the tax deductions from awards or units paid out | $ 17.8 | $ 14.6 | $ 13.2 |
2014 Stock Incentive Plan, Amended and Restated 2010 Stock Incentive Plan and Stock Incentive Plan | |||
Other award and unit disclosures | |||
Vesting period | 3 years | ||
2014 Stock Incentive Plan, Amended and Restated 2010 Stock Incentive Plan and Stock Incentive Plan | Restricted Stock Units | |||
Other award and unit disclosures | |||
Vesting period | 3 years | ||
2021 Stock Incentive Plan, 2020 Directors Stock Plan, 2014 Directors Stock Plan and 2005 Directors Stock Plan | Restricted Stock Units | |||
Other award and unit disclosures | |||
Vesting period | 1 year |
Stock-Based Compensation Plan_7
Stock-Based Compensation Plans - Employee Stock Purchase Plan (Details) - Employee Stock Purchase Plan - USD ($) $ / shares in Units, shares in Millions | Jan. 01, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Stock-Based Compensation Plans - Disclosures | ||||
Maximum value of company common stock that can be purchased by an employee per year | $ 25,000 | |||
Employee purchase price as a percent of fair market value (as a percent) | 90.00% | 85.00% | ||
Share purchases under employee stock purchase plan (in shares) | 1 | 1.4 | 0.9 | |
Weighted-average fair value of discount on employee stock purchase plan (in dollars per share) | $ 15.64 | $ 11.33 | $ 11.37 | |
Intrinsic value from shares settled | $ 15,300,000 | $ 15,500,000 | $ 9,700,000 | |
Cash received from shares issued | 46,500,000 | 37,800,000 | 36,200,000 | |
Tax benefits realized from the settlement of share-based payment arrangements | $ 1,300,000 | $ 900,000 | $ 900,000 | |
Shares available to be issued under employee stock purchase plan (in shares) | 4 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Net income (loss) | $ 1,757.4 | $ 1,428.5 | $ 1,444.1 |
Subtract: | |||
Net income (losses) attributable to noncontrolling interest | 46.8 | 32.7 | 49.9 |
Total | $ 1,710.6 | $ 1,395.8 | $ 1,394.2 |
Weighted-average shares outstanding: | |||
Basic | 269 | 274.7 | 278.6 |
Dilutive effects: | |||
Diluted | 272.9 | 276.6 | 281 |
Net income (loss) per common share: | |||
Basic | $ 6.36 | $ 5.08 | $ 5 |
Diluted | $ 6.27 | $ 5.05 | $ 4.96 |
Nonqualified Stock Options | |||
Dilutive effects: | |||
Stock-based compensation awards | 1.3 | 0.3 | 0.9 |
Restricted Stock Units | |||
Dilutive effects: | |||
Stock-based compensation awards | 2.1 | 1.5 | 1.4 |
Performance Share Awards | |||
Dilutive effects: | |||
Stock-based compensation awards | 0.5 | 0.1 | 0.1 |
Subsequent Event (Details)
Subsequent Event (Details) - USD ($) $ in Billions | Jan. 31, 2022 | Jan. 31, 2022 | Dec. 31, 2021 |
Subsequent Event [Line Items] | |||
Share repurchase program, remaining available amount under June 2021 plan (in dollars) | $ 1.1 | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Share repurchase program, maximum authorized amount (in dollars) | $ 1.6 | ||
Subsequent Event | Master Transaction Agreement ("Reinsurance Transaction") | Reinsurance | Sutton Cayman, Ltd. | |||
Subsequent Event [Line Items] | |||
Reinsured percentage | 100.00% | ||
Subsequent Event | Master Transaction Agreement ("Reinsurance Transaction") | Coinsurance With Funds Withheld | Sutton Cayman, Ltd. | |||
Subsequent Event [Line Items] | |||
Reinsured percentage | 100.00% |
Schedule I - Summary of Inves_2
Schedule I - Summary of Investments - Other Than Investments in Related Parties (Details) $ in Millions | Dec. 31, 2021USD ($) |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | $ 103,621.3 |
Amount as shown in the Consolidated Statement of Financial Position | 108,905.9 |
Fixed maturities | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 72,869.9 |
Value | 78,154.5 |
Amount as shown in the Consolidated Statement of Financial Position | 78,154.5 |
Fixed maturities | Trading | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 422.2 |
Value | 422.2 |
Amount as shown in the Consolidated Statement of Financial Position | 422.2 |
U.S. government and agencies | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 1,978 |
Value | 2,088.6 |
Amount as shown in the Consolidated Statement of Financial Position | 2,088.6 |
States and political subdivisions | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 8,290.7 |
Value | 9,304.4 |
Amount as shown in the Consolidated Statement of Financial Position | 9,304.4 |
Non-U.S. governments | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 851 |
Value | 982 |
Amount as shown in the Consolidated Statement of Financial Position | 982 |
Public utilities | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 5,226.7 |
Value | 5,695.8 |
Amount as shown in the Consolidated Statement of Financial Position | 5,695.8 |
Redeemable preferred stock | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 99.1 |
Value | 101 |
Amount as shown in the Consolidated Statement of Financial Position | 101 |
All other corporate bonds | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 36,813.4 |
Value | 40,147.6 |
Amount as shown in the Consolidated Statement of Financial Position | 40,147.6 |
Residential mortgage-backed pass-through securities | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 3,122.3 |
Value | 3,152.9 |
Amount as shown in the Consolidated Statement of Financial Position | 3,152.9 |
Commercial mortgage-backed securities | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 5,436.2 |
Value | 5,562.2 |
Amount as shown in the Consolidated Statement of Financial Position | 5,562.2 |
Collateralized debt obligations | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 3,564.7 |
Value | 3,559.6 |
Amount as shown in the Consolidated Statement of Financial Position | 3,559.6 |
Other debt obligations | Available-for-sale | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 7,487.8 |
Value | 7,560.4 |
Amount as shown in the Consolidated Statement of Financial Position | 7,560.4 |
Equity securities | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 2,347.2 |
Value | 2,347.2 |
Amount as shown in the Consolidated Statement of Financial Position | 2,347.2 |
Common stocks: Banks, trust and insurance companies | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 886.9 |
Value | 886.9 |
Amount as shown in the Consolidated Statement of Financial Position | 886.9 |
Common stocks: Public Utilities | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 7.5 |
Value | 7.5 |
Amount as shown in the Consolidated Statement of Financial Position | 7.5 |
Common stocks: Industrial, miscellaneous and all other | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 854.7 |
Value | 854.7 |
Amount as shown in the Consolidated Statement of Financial Position | 854.7 |
Other corporate | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 465.2 |
Value | 465.2 |
Amount as shown in the Consolidated Statement of Financial Position | 465.2 |
Non-redeemable preferred stock | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 132.9 |
Value | 132.9 |
Amount as shown in the Consolidated Statement of Financial Position | 132.9 |
Mortgage loans | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 19,668.7 |
Amount as shown in the Consolidated Statement of Financial Position | 19,668.7 |
Real estate acquired in satisfaction of debt | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 14.8 |
Amount as shown in the Consolidated Statement of Financial Position | 14.8 |
Other real estate | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 2,060.6 |
Amount as shown in the Consolidated Statement of Financial Position | 2,060.6 |
Policy loans | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 759.6 |
Amount as shown in the Consolidated Statement of Financial Position | 759.6 |
Investments: Other investments | |
Summary of Investments - Other Than Investments in Related Parties | |
Cost | 5,478.3 |
Amount as shown in the Consolidated Statement of Financial Position | $ 5,478.3 |
Schedule II - Condensed Finan_2
Schedule II - Condensed Financial Information of Registrant (Parent Only) - Statements of Financial Position (Details) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Assets | ||
Fixed maturities, available-for-sale | $ 78,154.5 | $ 78,710.3 |
Fixed maturities, trading | 422.2 | 532.1 |
Other investments | 5,478.3 | 5,126.8 |
Cash and Cash Equivalents | 2,332 | 2,849.8 |
Deferred income taxes | 85 | 113.8 |
Total assets | 304,657.2 | 296,627.7 |
Liabilities | ||
Long-term debt | 4,280.2 | 4,279.2 |
Total liabilities | 288,198.9 | 279,754.8 |
Stockholders' equity | ||
Common stock, par value $0.01 per share; 2,500.0 million shares authorized; 484.9 million and 481.9 million shares issued as of 2021 and 2020; 261.7 million and 273.3 million shares outstanding as of 2021 and 2020 | 4.8 | 4.8 |
Additional paid-in capital | 10,495 | 10,321.6 |
Retained earnings | 12,884.5 | 11,838 |
Accumulated other comprehensive income | 1,610.9 | 2,383.1 |
Treasury stock, at cost (223.2 million and 208.6 million shares as of 2021 and 2020) | (8,925.8) | (7,988.6) |
Total stockholders' equity attributable to Principal Financial Group, Inc. | 16,069.4 | 16,558.9 |
Total liabilities and stockholders' equity | 304,657.2 | 296,627.7 |
Principal Financial Group, Inc. Parent Only | Legal Entities | ||
Assets | ||
Fixed maturities, available-for-sale | 1,051.9 | 813.2 |
Fixed maturities, trading | 109 | 178.8 |
Other investments | 10.4 | 63.7 |
Cash and Cash Equivalents | 320.3 | 302.4 |
Income taxes receivable | 20.4 | 7.4 |
Deferred income taxes | 320.9 | 371.2 |
Amounts receivable from subsidiaries | 5.5 | 4.7 |
Other assets | 27.1 | 27.1 |
Investment in unconsolidated entities | 18,932.4 | 19,714.3 |
Total assets | 20,797.9 | 21,482.8 |
Liabilities | ||
Long-term debt | 4,226.2 | 4,223.3 |
Accrued investment payable | 25.3 | 25.3 |
Pension liability | 473.2 | 668.9 |
Other liabilities | 3.8 | 6.4 |
Total liabilities | 4,728.5 | 4,923.9 |
Stockholders' equity | ||
Common stock, par value $0.01 per share; 2,500.0 million shares authorized; 484.9 million and 481.9 million shares issued as of 2021 and 2020; 261.7 million and 273.3 million shares outstanding as of 2021 and 2020 | 4.8 | 4.8 |
Additional paid-in capital | 10,495 | 10,321.6 |
Retained earnings | 12,884.5 | 11,838 |
Accumulated other comprehensive income | 1,610.9 | 2,383.1 |
Treasury stock, at cost (223.2 million and 208.6 million shares as of 2021 and 2020) | (8,925.8) | (7,988.6) |
Total stockholders' equity attributable to Principal Financial Group, Inc. | 16,069.4 | 16,558.9 |
Total liabilities and stockholders' equity | $ 20,797.9 | $ 21,482.8 |
Schedule II - Condensed Finan_3
Schedule II - Condensed Financial Information of Registrant (Parent Only) - Statements of Financial Position - Parenthetical (Details) - $ / shares shares in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Condensed Financial Statements, Captions [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, authorized (in shares) | 2,500 | 2,500 |
Common stock, issued (in shares) | 484.9 | 481.9 |
Common stock, outstanding (in shares) | 261.7 | 273.3 |
Treasury stock (in shares) | 223.2 | 208.6 |
Principal Financial Group, Inc. Parent Only | Legal Entities | ||
Condensed Financial Statements, Captions [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | |
Common stock, authorized (in shares) | 2,500 | |
Common stock, issued (in shares) | 484.9 | 481.9 |
Common stock, outstanding (in shares) | 261.7 | 273.3 |
Treasury stock (in shares) | 223.2 | 208.6 |
Schedule II - Condensed Finan_4
Schedule II - Condensed Financial Information of Registrant (Parent Only) - Statements of Operations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Revenues | |||
Net investment income (loss) | $ 4,406.1 | $ 3,890.6 | $ 3,998.4 |
Net realized capital gains (losses) | 2.5 | 302.6 | (52.8) |
Total revenues | 14,262.7 | 14,741.7 | 16,222.1 |
Expenses | |||
Other operating costs and expenses | 4,987.3 | 4,646.5 | 4,503.9 |
Total expenses | 12,179.1 | 13,048.2 | 14,528.8 |
Loss before income taxes | 2,083.6 | 1,693.5 | 1,693.3 |
Income taxes (benefits) | 326.2 | 265 | 249.2 |
Net income (loss) attributable to Principal Financial Group, Inc. | 1,710.6 | 1,395.8 | 1,394.2 |
Principal Financial Group, Inc. Parent Only | Legal Entities | |||
Revenues | |||
Net investment income (loss) | 18.6 | 13.3 | 19.4 |
Net realized capital gains (losses) | (14.9) | 7 | 12.3 |
Total revenues | 3.7 | 20.3 | 31.7 |
Expenses | |||
Other operating costs and expenses | 160.9 | 200 | 210.9 |
Total expenses | 160.9 | 200 | 210.9 |
Loss before income taxes | (157.2) | (179.7) | (179.2) |
Income taxes (benefits) | (35.6) | (46.1) | (44.2) |
Equity in the net income (loss) of subsidiaries | 1,832.2 | 1,529.4 | 1,529.2 |
Net income (loss) attributable to Principal Financial Group, Inc. | $ 1,710.6 | $ 1,395.8 | $ 1,394.2 |
Schedule II - Condensed Finan_5
Schedule II - Condensed Financial Information of Registrant (Parent Only) - Statements of Cash Flows (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Operating activities | |||
Net income (loss) | $ 1,757.4 | $ 1,428.5 | $ 1,444.1 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Net realized capital (gains) losses | (2.5) | (302.6) | 52.8 |
Stock-based compensation | 96.1 | 87.6 | 82.6 |
Changes in: | |||
Net cash flows for trading securities and equity securities with operating intent | 99.9 | 144.2 | (53.8) |
Current and deferred income taxes (benefits) | 160.2 | 442.5 | 211.2 |
Other | (15.3) | 110.4 | 11.1 |
Net cash provided by (used in) operating activities | 3,218.8 | 3,738.6 | 5,493.2 |
Investing activities | |||
Fixed maturities available-for-sale and equity securities with intent to hold: Purchases | (16,625.5) | (15,713.4) | (14,137.1) |
Fixed maturities available-for-sale and equity securities with intent to hold: Maturities | 10,960 | 8,819.5 | 7,064.2 |
Net (purchases) sales of property and equipment | (129.9) | (108.8) | (132.4) |
Net change in other investments | (107) | (66.4) | (489.1) |
Net cash provided by (used in) investing activities | (5,658.1) | (5,025.8) | (7,688.5) |
Financing activities | |||
Issuance of common stock | 86.7 | 42.8 | 37.7 |
Acquisition of treasury stock | (937.2) | (307) | (281) |
Dividends to common stockholders | (654.1) | (614.5) | (606) |
Issuance of long-term debt | 608.9 | 504.9 | |
Net cash provided by (used in) financing activities | 1,921.5 | 1,621.1 | 1,733.7 |
Net increase (decrease) in cash and cash equivalents | (517.8) | 333.9 | (461.6) |
Cash and cash equivalents at beginning of period | 2,849.8 | 2,515.9 | 2,977.5 |
Cash and cash equivalents at end of period | 2,332 | 2,849.8 | 2,515.9 |
Principal Financial Group, Inc. Parent Only | Legal Entities | |||
Operating activities | |||
Net income (loss) | 1,710.6 | 1,395.8 | 1,394.2 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||
Net realized capital (gains) losses | 14.9 | (7) | (12.3) |
Stock-based compensation | 1.6 | 1.4 | 1.3 |
Equity in the net (income) loss of subsidiaries | (1,832.2) | (1,529.4) | (1,529.2) |
Changes in: | |||
Net cash flows for trading securities and equity securities with operating intent | 66.1 | 88.4 | 48.7 |
Current and deferred income taxes (benefits) | (4.8) | (13.5) | (31) |
Other | (34.5) | 49.1 | 135.4 |
Net cash provided by (used in) operating activities | (78.3) | (15.2) | 7.1 |
Investing activities | |||
Fixed maturities available-for-sale and equity securities with intent to hold: Purchases | (462.3) | (736.5) | (251.5) |
Fixed maturities available-for-sale and equity securities with intent to hold: Maturities | 190.2 | 193.7 | 200 |
Net (purchases) sales of property and equipment | (0.1) | (0.1) | (0.1) |
Net change in other investments | 46.7 | (50) | (34) |
Dividends and returns of capital received from unconsolidated entities | 1,826.3 | 799.1 | 494.2 |
Net cash provided by (used in) investing activities | 1,600.8 | 206.2 | 408.6 |
Financing activities | |||
Issuance of common stock | 86.7 | 42.8 | 37.7 |
Acquisition of treasury stock | (937.2) | (307) | (281) |
Dividends to common stockholders | (654.1) | (614.5) | (606) |
Issuance of long-term debt | 595.2 | 493.6 | |
Net cash provided by (used in) financing activities | (1,504.6) | (283.5) | (355.7) |
Net increase (decrease) in cash and cash equivalents | 17.9 | (92.5) | 60 |
Cash and cash equivalents at beginning of period | 302.4 | 394.9 | 334.9 |
Cash and cash equivalents at end of period | $ 320.3 | $ 302.4 | $ 394.9 |
Schedule II - Condensed Finan_6
Schedule II - Condensed Financial Information of Registrant (Parent Only) - Financial Statement Footnotes (Details) - Principal Financial Group, Inc. Parent Only - Legal Entities - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Dividends and Returns of Capital Received from (Contributed to) Unconsolidated Entities | |||
Dividends and returns of capital received from unconsolidated entities | $ 1,826.3 | $ 799.1 | $ 494.2 |
Nonqualified benefit plans | |||
Condensed Financial Statements, Captions [Line Items] | |||
Assets held in Rabbi trusts | 889 | 801.7 | |
Liabilities held in Rabbi trusts | $ 732.9 | $ 653.3 |
Schedule III - Supplementary _2
Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Supplementary Insurance Information | ||||
Deferred acquisition costs | $ 3,757.5 | $ 3,409.7 | $ 3,521.3 | $ 3,693.5 |
Future policy benefits and claims | 43,948.1 | 45,207.2 | ||
Contractholder and other policyholder funds | 44,669 | 44,297.1 | ||
Premiums and other considerations | 4,841.5 | 6,037.4 | 7,866.6 | |
Net investment income (loss) | 4,406.1 | 3,890.6 | 3,998.4 | |
Benefits, claims and settlement expenses | 7,097 | 8,281.5 | 9,905.8 | |
Amortization of deferred acquisition costs | 285.4 | 388.1 | 347 | |
Other operating expenses | 4,701.9 | 4,258.4 | 4,156.9 | |
Retirement and Income Solutions | ||||
Supplementary Insurance Information | ||||
Deferred acquisition costs | 819.4 | 730.4 | ||
Future policy benefits and claims | 27,716.5 | 28,134.1 | ||
Contractholder and other policyholder funds | 35,941.4 | 35,576 | ||
Premiums and other considerations | 1,883.6 | 3,221 | 4,862.7 | |
Net investment income (loss) | 2,674.4 | 2,457.9 | 2,420.4 | |
Benefits, claims and settlement expenses | 3,450.1 | 4,899.4 | 6,527.8 | |
Amortization of deferred acquisition costs | 116.7 | 82.2 | 87.8 | |
Other operating expenses | 1,715.2 | 1,578.2 | 1,403.5 | |
Principal Global Investors | ||||
Supplementary Insurance Information | ||||
Net investment income (loss) | 3.9 | 5.6 | 10.1 | |
Other operating expenses | 1,128.6 | 1,029.6 | 1,028.5 | |
Principal International | ||||
Supplementary Insurance Information | ||||
Deferred acquisition costs | 8.4 | 11.2 | ||
Future policy benefits and claims | 3,813.5 | 5,109.5 | ||
Contractholder and other policyholder funds | 1,047.2 | 1,167.3 | ||
Premiums and other considerations | 127.5 | 156.6 | 393.3 | |
Net investment income (loss) | 631.1 | 446.8 | 575.9 | |
Benefits, claims and settlement expenses | 610 | 440.7 | 728.3 | |
Amortization of deferred acquisition costs | 1.2 | 1.2 | 1.3 | |
Other operating expenses | 469.1 | 416.8 | 436 | |
U.S. Insurance Solutions | ||||
Supplementary Insurance Information | ||||
Deferred acquisition costs | 2,929.7 | 2,668.1 | ||
Future policy benefits and claims | 12,262.1 | 11,800.3 | ||
Contractholder and other policyholder funds | 8,039.6 | 7,909.5 | ||
Premiums and other considerations | 2,830.4 | 2,659.8 | 2,610.6 | |
Net investment income (loss) | 917.1 | 850.6 | 854.5 | |
Benefits, claims and settlement expenses | 3,031.7 | 2,937.2 | 2,639.2 | |
Amortization of deferred acquisition costs | 167.5 | 304.7 | 257.9 | |
Other operating expenses | 998.2 | 936.9 | 946.5 | |
Corporate | ||||
Supplementary Insurance Information | ||||
Future policy benefits and claims | 156 | 163.3 | ||
Contractholder and other policyholder funds | (359.2) | (355.7) | ||
Net investment income (loss) | 179.6 | 129.7 | 137.5 | |
Benefits, claims and settlement expenses | 5.2 | 4.2 | 10.5 | |
Other operating expenses | $ 390.8 | $ 296.9 | $ 342.4 |
Schedule IV - Reinsurance (Deta
Schedule IV - Reinsurance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Life insurance in force | |||
Life insurance in force gross amount | $ 667,509.8 | $ 626,155.6 | $ 577,735.3 |
Life insurance in force ceded to other companies | 383,937.7 | 377,308.2 | 368,583 |
Life insurance in force assumed from other companies | 787.8 | 904.1 | 999.5 |
Life insurance in force net amount | $ 284,359.9 | $ 249,751.5 | $ 210,151.8 |
Life insurance in force, percentage of amount assumed to net (as a percent) | 0.30% | 0.40% | 0.50% |
Premiums: | |||
Premiums gross amount | $ 5,490.6 | $ 6,645.4 | $ 8,428.1 |
Premiums ceded to other companies | 650.6 | 609.7 | 563.1 |
Premiums assumed from other companies | 1.5 | 1.7 | 1.6 |
Premiums net amount | 4,841.5 | 6,037.4 | 7,866.6 |
Life insurance and annuities | |||
Premiums: | |||
Premiums gross amount | 3,323.3 | 4,608.7 | 6,424.8 |
Premiums ceded to other companies | 494.9 | 453.1 | 407.5 |
Premiums assumed from other companies | 1.5 | 1.7 | 1.6 |
Premiums net amount | $ 2,829.9 | 4,157.3 | 6,018.9 |
Premiums percentage of amount assumed to net (as a percent) | 0.10% | ||
Accident and health insurance | |||
Premiums: | |||
Premiums gross amount | $ 2,167.3 | 2,036.7 | 2,003.3 |
Premiums ceded to other companies | 155.7 | 156.6 | 155.6 |
Premiums net amount | $ 2,011.6 | $ 1,880.1 | $ 1,847.7 |