Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2020 | Apr. 13, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 1-32630 | |
Entity Registrant Name | FIDELITY NATIONAL FINANCIAL, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 16-1725106 | |
Entity Address, Address Line One | 601 Riverside Avenue | |
Entity Address, City or Town | Jacksonville | |
Entity Address, State or Province | FL | |
Entity Address, Postal Zip Code | 32204 | |
City Area Code | 904 | |
Local Phone Number | 854-8100 | |
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 | |
Entity Shell Company | false | |
FNF Common Stock (in shares) | 272,013,813 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q1 | |
Entity Central Index Key | 0001331875 | |
Current Fiscal Year End Date | --12-31 | |
Common Stock | ||
Document Information [Line Items] | ||
Title of 12(b) Security | FNF Common Stock, $0.0001 par value | |
Trading Symbol | FNF | |
Security Exchange Name | NYSE | |
5.50% Notes due September 2022 | ||
Document Information [Line Items] | ||
Title of 12(b) Security | 5.50% Notes due September 2022 | |
Trading Symbol | FNF22 | |
Security Exchange Name | NYSE |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Investments: | ||
Fixed maturity securities available for sale, at fair value, at March 31, 2020 and December 31, 2019, net of allowance for credit losses of $11 and $0, respectively, and includes pledged fixed maturity securities of $423 and $410, respectively, related to secured trust deposits | $ 2,057 | $ 2,090 |
Investments in unconsolidated affiliates | 148 | 131 |
Other long-term investments | 93 | 153 |
Short-term investments, at March 31, 2020 and December 31, 2019 includes pledged short-term investments of $0 and $12, respectively, related to secured trust deposits | 1,258 | 876 |
Total investments | 4,488 | 4,384 |
Cash and cash equivalents, at March 31, 2020 and December 31, 2019 includes $306 and $384, respectively, of pledged cash related to secured trust deposits | 890 | 1,376 |
Trade and notes receivables, net of allowance of $23 and $20 at March 31, 2020 and December 31, 2019, respectively | 322 | 346 |
Goodwill | 2,726 | 2,727 |
Prepaid expenses and other assets | 397 | 432 |
Lease assets | 406 | 410 |
Other intangible assets, net | 396 | 422 |
Title plants | 404 | 404 |
Property and equipment, net | 175 | 176 |
Total assets | 10,204 | 10,677 |
Liabilities: | ||
Accounts payable and accrued liabilities | 864 | 1,094 |
Notes payable | 839 | 838 |
Reserve for title claim losses | 1,518 | 1,509 |
Secured trust deposits | 826 | 791 |
Lease liabilities | 439 | 442 |
Income taxes payable | 53 | 10 |
Deferred tax liability | 205 | 284 |
Total liabilities | 4,744 | 4,968 |
Commitments and Contingencies: | ||
Redeemable non-controlling interest by 21% minority holder of ServiceLink Holdings, LLC | 344 | 344 |
Equity: | ||
FNF common stock, $0.0001 par value; authorized 600,000,000 shares as of March 31, 2020 and December 31, 2019; outstanding of 272,418,216 and 275,563,436 as of March 31, 2020 and December 31, 2019, respectively, and issued of 292,341,256 and 292,236,476 as of March 31, 2020 and December 31, 2019, respectively | 0 | 0 |
Preferred stock, $0.0001 par value; authorized 50,000,000 shares; issued and outstanding, none | 0 | 0 |
Additional paid-in capital | 4,592 | 4,581 |
Retained earnings | 1,204 | 1,356 |
Accumulated other comprehensive earnings | 28 | 43 |
Less: Treasury stock,19,923,040 shares and 16,673,040 shares as of March 31, 2020 and December 31, 2019, respectively, at cost | (692) | (598) |
Total Fidelity National Financial, Inc. shareholders’ equity | 5,132 | 5,382 |
Non-controlling interests | (16) | (17) |
Total equity | 5,116 | 5,365 |
Total liabilities, redeemable non-controlling interest and equity | 10,204 | 10,677 |
Preferred securities | ||
Investments: | ||
Securities, at fair value | 304 | 323 |
Equity securities | ||
Investments: | ||
Securities, at fair value | $ 628 | $ 811 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Fixed maturity securities available-for-sale, allowance for credit losses | $ 11,000,000 | $ 0 |
Pledged fixed maturity securities | 423,000,000 | 410,000,000 |
Short term investments, secured trust deposits | 0 | 12,000,000 |
Pledged cash, secured trust deposits | 306,000,000 | 384,000,000 |
Trade and notes receivables, allowance | $ 23,000,000 | $ 20,000,000 |
Common stock, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock authorized (in shares) | 600,000,000 | 600,000,000 |
Common stock outstanding (in shares) | 272,418,216 | 275,563,436 |
Common stock issued (in shares) | 292,341,256 | 292,236,476 |
Preferred stock par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Preferred stock authorized (in shares) | 50,000,000 | 50,000,000 |
Preferred stock issued (in shares) | 0 | 0 |
Preferred stock outstanding (in shares) | 0 | 0 |
Treasury stock, at cost (in shares) | 19,923,040 | 16,673,040 |
ServiceLink Holdings, LLC | ||
Ownership interest | 21.00% | 21.00% |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Revenues: | ||
Direct title insurance premiums | $ 546 | $ 440 |
Agency title insurance premiums | 732 | 552 |
Escrow, title-related and other fees | 601 | 534 |
Interest and investment income | 53 | 54 |
Realized gains and losses, net | (320) | 142 |
Total revenues | 1,612 | 1,722 |
Expenses: | ||
Personnel costs | 614 | 592 |
Agent commissions | 560 | 421 |
Other operating expenses | 411 | 344 |
Depreciation and amortization | 43 | 44 |
Provision for title claim losses | 58 | 45 |
Interest expense | 12 | 12 |
Total expenses | 1,698 | 1,458 |
(Loss) earnings from continuing operations before income taxes and equity in earnings of unconsolidated affiliates | (86) | 264 |
Income tax (benefit) expense | (28) | 65 |
(Loss) earnings before equity in earnings of unconsolidated affiliates | (58) | 199 |
Equity in earnings of unconsolidated affiliates | 1 | 7 |
Net (loss) earnings | (57) | 206 |
Less: Net earnings attributable to non-controlling interests | 4 | 0 |
Net earnings attributable to common shareholders | $ (61) | $ 206 |
Earnings per share | ||
Net earnings per share attributable to shareholders, basic (in usd per share) | $ (0.22) | $ 0.75 |
Net earnings per share attributable to shareholders, diluted (in usd per share) | $ (0.22) | $ 0.74 |
Weighted average shares outstanding, basic basis (in shares) | 274 | 273 |
Weighted average shares outstanding, diluted basis (in shares) | 274 | 277 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Net (loss) earnings | $ (57) | $ 206 |
Other comprehensive (loss) earnings: | ||
Unrealized (loss) gain on investments and other financial instruments, net (excluding investments in unconsolidated affiliates | (9) | 23 |
Unrealized gain on investments in unconsolidated affiliates | 7 | 6 |
Unrealized (loss) gain on foreign currency translation | (10) | 2 |
Reclassification adjustments for change in unrealized gains and losses included in net earnings | (3) | (4) |
Other comprehensive (loss) earnings | (15) | 27 |
Comprehensive (loss) earnings | (72) | 233 |
Less: Comprehensive earnings attributable to non-controlling interests | 4 | 0 |
Comprehensive (loss) earnings attributable to Fidelity National Financial, Inc. common shareholders | $ (76) | $ 233 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Comprehensive Income [Abstract] | ||
Unrealized gain (loss) on investments and other financial instruments, tax (benefit) expense | $ (3) | $ 7 |
Unrealized gain on investments in unconsolidated affiliates tax expense | 2 | 2 |
Unrealized (loss) gain foreign currency translation, tax (benefit) expense | (3) | 1 |
Reclassification adjustments for change in unrealized gains and losses included in net earnings, tax | $ (1) | $ 1 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENT OF EQUITY - USD ($) shares in Millions, $ in Millions | Total | Common StockFNF Group Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Earnings (Loss) | Treasury Stock | Non-controlling Interests |
Beginning balance (in shares) at Dec. 31, 2018 | 290 | 14 | |||||
Beginning balance at Dec. 31, 2018 | $ 4,628 | $ 0 | $ 4,500 | $ 641 | $ (13) | $ (498) | $ (2) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options (in shares) | 0 | ||||||
Exercise of stock options | 1 | 1 | |||||
Treasury stock repurchased (in shares) | 1 | ||||||
Treasury stock repurchased | (18) | $ (18) | |||||
Other comprehensive earnings - unrealized gain on investments and other financial instruments | 23 | 23 | |||||
Other comprehensive earnings - unrealized gain on investments in unconsolidated affiliates | 6 | 6 | |||||
Other comprehensive earnings - unrealized gain (loss) on foreign Currency translation | 2 | 2 | |||||
Reclassification adjustments for change in unrealized gains and losses included in net earnings | (4) | (4) | |||||
Stock-based compensation | 9 | 9 | |||||
Dividends declared, per common share | (85) | (85) | |||||
Subsidiary dividends declared to non-controlling interests | (3) | (3) | |||||
Net (loss) earnings | 206 | 0 | |||||
Ending balance (in shares) at Mar. 31, 2019 | 290 | 15 | |||||
Ending balance at Mar. 31, 2019 | 4,765 | $ 0 | 4,510 | 762 | 14 | $ (516) | (5) |
Beginning balance at Dec. 31, 2018 | 344 | ||||||
Ending balance at Mar. 31, 2019 | 344 | ||||||
Beginning balance (in shares) at Dec. 31, 2019 | 292 | 17 | |||||
Beginning balance at Dec. 31, 2019 | 5,365 | $ 0 | 4,581 | 1,356 | 43 | $ (598) | (17) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Exercise of stock options (in shares) | 0 | ||||||
Exercise of stock options | 2 | 2 | |||||
Treasury stock repurchased (in shares) | 3 | ||||||
Treasury stock repurchased | (94) | $ (94) | |||||
Other comprehensive earnings - unrealized gain on investments and other financial instruments | (9) | (9) | |||||
Other comprehensive earnings - unrealized gain on investments in unconsolidated affiliates | 7 | 7 | |||||
Other comprehensive earnings - unrealized gain (loss) on foreign Currency translation | (10) | (10) | |||||
Reclassification adjustments for change in unrealized gains and losses included in net earnings | (3) | (3) | |||||
Stock-based compensation | 9 | 9 | |||||
Dividends declared, per common share | (91) | (91) | |||||
Subsidiary dividends declared to non-controlling interests | (3) | (3) | |||||
Net (loss) earnings | (57) | (61) | 4 | ||||
Ending balance (in shares) at Mar. 31, 2020 | 292 | 20 | |||||
Ending balance at Mar. 31, 2020 | 5,116 | $ 0 | $ 4,592 | $ 1,204 | $ 28 | $ (692) | $ (16) |
Beginning balance at Dec. 31, 2019 | 344 | ||||||
Ending balance at Mar. 31, 2020 | $ 344 |
CONDENSED CONSOLIDATED STATEM_5
CONDENSED CONSOLIDATED STATEMENT OF EQUITY (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Statement of Stockholders' Equity [Abstract] | ||
Cash dividends declared (in usd per share) | $ 0.33 | $ 0.31 |
CONDENSED CONSOLIDATED STATEM_6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash flows from operating activities: | ||
Net (loss) earnings | $ (57) | $ 206 |
Adjustments to reconcile net (loss) earnings to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 43 | 44 |
Equity in earnings of unconsolidated affiliates | (1) | (7) |
Loss on sales of investments and other assets and asset impairments, net | 8 | 0 |
Non-cash lease costs | 37 | 37 |
Operating lease payments | (38) | (37) |
Distributions from unconsolidated affiliates, return on investment | 0 | 3 |
Stock-based compensation cost | 9 | 9 |
Change in valuation of equity and preferred securities, net | 312 | (142) |
Changes in assets and liabilities, net of effects from acquisitions: | ||
Net decrease in trade receivables | 20 | 12 |
Net decrease (increase) in prepaid expenses and other assets | 23 | (76) |
Net decrease in accounts payable, accrued liabilities, deferred revenue and other | (228) | (106) |
Net increase (decrease) in reserve for title claim losses | 9 | (5) |
Net change in income taxes | (32) | 58 |
Net cash provided by (used in) operating activities | 105 | (4) |
Cash flows from investing activities: | ||
Proceeds from sales of investment securities | 106 | 194 |
Proceeds from calls and maturities of investment securities | 159 | 62 |
Proceeds from sales of property and equipment | 9 | 0 |
Fundings of Cannae Holdings Inc. note receivable | 0 | (100) |
Additions to property and equipment and capitalized software | (28) | (22) |
Purchases of investment securities | (300) | (322) |
Net (purchases of) proceeds from sales and maturities of short-term investment securities | (382) | 268 |
Additional investments in unconsolidated affiliates | (9) | (1) |
Distributions from unconsolidated affiliates, return of investment | 2 | 17 |
Net other investing activities | 4 | (2) |
Net cash (used in) provided by investing activities | (439) | 94 |
Cash flows from financing activities: | ||
Dividends paid | (90) | (85) |
Subsidiary dividends paid to non-controlling interest shareholders | (3) | (3) |
Exercise of stock options | 2 | 1 |
Net change in secured trust deposits | 35 | (113) |
Payment of contingent consideration for prior period acquisitions | (7) | (6) |
Purchases of treasury stock | (89) | (18) |
Net cash used in financing activities | (152) | (224) |
Net decrease in cash and cash equivalents | (486) | (134) |
Cash and cash equivalents at beginning of period | 1,376 | 1,257 |
Cash and cash equivalents at end of period | $ 890 | $ 1,123 |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Information | Supplemental Cash Flow Information The following supplemental cash flow information is provided with respect to certain cash payment and non-cash investing and financing activities. Three months ended March 31, 2020 2019 Cash paid for: Interest $ 22 $ 22 Income taxes 4 6 Non-cash investing and financing activities: Change in proceeds of sales of investments available for sale receivable in period $ — $ (44) Change in purchases of investments available for sale payable in period — 20 Change in treasury stock purchases payable in period 5 — Lease liabilities recognized in exchange for lease right-of-use assets 8 6 Remeasurement of lease liabilities 22 9 |
Supplemental Cash Flow Inform_2
Supplemental Cash Flow Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Supplemental Cash Flow information | The following supplemental cash flow information is provided with respect to certain cash payment and non-cash investing and financing activities. Three months ended March 31, 2020 2019 Cash paid for: Interest $ 22 $ 22 Income taxes 4 6 Non-cash investing and financing activities: Change in proceeds of sales of investments available for sale receivable in period $ — $ (44) Change in purchases of investments available for sale payable in period — 20 Change in treasury stock purchases payable in period 5 — Lease liabilities recognized in exchange for lease right-of-use assets 8 6 Remeasurement of lease liabilities 22 9 |
Supplemental Cash Flow Inform_3
Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash paid for: | ||
Interest | $ 22 | $ 22 |
Income taxes | 4 | 6 |
Non-cash investing and financing activities: | ||
Change in proceeds of sales of investments available for sale receivable in period | 0 | (44) |
Change in purchases of investments available for sale payable in period | 0 | 20 |
Change in treasury stock purchases payable in period | 5 | 0 |
Lease liabilities recognized in exchange for lease right-of-use assets | 8 | 6 |
Remeasurement of lease liabilities | $ 22 | $ 9 |
Basis of Financial Statements
Basis of Financial Statements | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | Basis of Financial Statements The financial information in this report presented for interim periods is unaudited and includes the accounts of Fidelity National Financial, Inc. and its subsidiaries (collectively, “we,” “us,” “our,” the "Company" or “FNF”) prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All adjustments made were of a normal, recurring nature. This report should be read in conjunction with our Annual Report on Form 10-K (our "Annual Report") for the year ended December 31, 2019. Description of the Business We are a leading provider of (i) title insurance, escrow and other title-related services, including trust activities, trustee sales guarantees, recordings and reconveyances and home warranty products and (ii) technology and transaction services to the real estate and mortgage industries. FNF is one of the nation’s largest title insurance companies operating through its title insurance underwriters - Fidelity National Title Insurance Company ("FNTIC"), Chicago Title Insurance Company ("Chicago Title"), Commonwealth Land Title Insurance Company ("Commonwealth Title"), Alamo Title Insurance and National Title Insurance of New York Inc. - which collectively issue more title insurance policies than any other title company in the United States. Through our subsidiary, ServiceLink Holdings, LLC ("ServiceLink"), we provide mortgage transaction services, including title-related services and facilitation of production and management of mortgage loans. For information about our reportable segments refer to Note H Segment Information . Recent Developments Pending Acquisition of FGL Holdings ("FGL") On February 7, 2020, we entered into a merger agreement as amended or otherwise supplemented from time to time, (the “Merger Agreement”) to acquire FGL (NYSE: FG) (the “FGL Merger”). Subject to the terms and conditions of the Merger Agreement, which has been approved by the board of directors of FNF, at the First Effective Time (as defined in the Merger Agreement), the ordinary shares of FGL (the “Ordinary Shares”), including all restricted Ordinary Shares (whether vested or unvested), issued and outstanding as of immediately prior to the First Effective Time (other than (i) shares owned by FGL and any of its subsidiaries or FNF and any of its subsidiaries and (ii) shares in respect of which dissenters rights have been properly exercised and perfected under Cayman law) will be converted into the right to receive $12.50 in cash or 0.2558 shares (“the Stock Consideration”) of common stock of FNF (“FNF Common Stock”), at the election of the holder thereof and subject to the proration mechanics set forth in the Merger Agreement. Pursuant to the Merger Agreement, all Ordinary Shares held by FNF and its subsidiaries will be converted into the right to receive the Stock Consideration. Each Series B Cumulative Preferred Share, all of which are held by FNF and its subsidiaries, will be converted into the right to receive a number of shares of FNF Common Stock that is equal to (i) the Liquidation Preference (as defined in the Merger Agreement) divided by (ii) the Reference Parent Common Stock Price (as defined in the Merger Agreement). Additionally, pursuant to the Merger Agreement, all options to purchase Ordinary Shares (“FGL Share Option”) and phantom unit denominated in Ordinary Shares (“FGL Phantom Unit”), in each case, outstanding immediately prior to the First Effective Time, will be canceled and converted into options to purchase FNF Common Stock and phantom units denominated in FNF Common Stock at the First Effective Time (collectively, the “Rollover Awards”), as applicable. The Rollover Awards will generally be subject to the same terms and conditions as applicable to the applicable canceled FGL Share Option or FGL Phantom Unit immediately prior to the First Effective Time, except that (i) all performance-vesting criteria will be deemed satisfied at the First Effective Time at the levels described in the Merger Agreement and such Rollover Awards will be subject only to time-based vesting conditions after the First Effective Time, and (ii) immediately prior to the First Effective Time, additional time-vesting credits will be provided to holders in respect of FGL Share Options and FGL Phantom Units granted prior to January 1, 2020, as described in the Merger Agreement. The closing of the FGL Merger is subject to certain closing conditions, including the approval by FGL stockholders, federal and state regulatory approvals, and the satisfaction of other customary closing conditions. Closing is expected in the second or third quarter of 2020. On April 27, 2020 we entered into an amendment to the Merger Agreement (the "Amendment"). See Item 5. of Part II of this Quarterly Report for further discussion of the Amendment. Term Loan In connection with the contemplated FGL Merger, on April 22, 2020, we entered into a term loan credit agreement that provides for an aggregate principal borrowing of $1.0 billion (the "Term Loan Agreement") with Bank of America, N.A, as administrative agent (in such capacity, the "Administrative Agent"), JPMorgan Chase Bank, N.A., as syndication agent, and the other lenders party thereto from time to time (the “Term Lenders”), pursuant to which the Term Lenders provided a $1 billion delayed draw term loan facility (the “Term Loan”). The Term Loan generally accrues interest based on a fluctuating rate per annum based on either (i) the base rate (which is equal to the highest of (a) the federal funds rate plus 0.5% of 1%, (b) the Administrative Agent’s "prime rate," and (c) LIBOR plus 1% (with a floor of 1.75%)), plus a margin of between 1% and 2% depending on the senior unsecured debt ratings of FNF (the “FNF Debt Rating”) or (ii) LIBOR (with a floor of 0.75%) plus a margin of between 2% and 0.03 depending on the FNF Debt Rating. In accordance with the Term Loan Agreement, the FGL Merger shall have been, or shall concurrently with the Term Loan Agreement borrowing be, consummated in accordance with the terms of the Merger Agreement. See Item 5. of Part II of this Quarterly Report for further discussion of the Term Loan Agreement. Income Tax Income tax (benefit) expense was $(28) million and $65 million in the three-month periods ended March 31, 2020 and 2019, respectively. Income tax (benefit) expense as a percentage of (loss) earnings before income taxes was 33% and 25% in the three-month periods ended March 31, 2020 and 2019, respectively. The change in income tax (benefit) expense as a percentage of (loss) earnings before income taxes in the 2020 period from the comparable period in 2019 is primarily attributable to an additional tax benefit in the current quarter of $7 million related to a 2017 amended return filed in the 2020 period. Earnings Per Share Basic earnings per share, as presented on the Condensed Consolidated Statement of Earnings, is computed by dividing net earnings available to common shareholders in a given period by the weighted average number of common shares outstanding during such period. In periods when earnings are positive, diluted earnings per share is calculated by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding plus the impact of assumed conversions of potentially dilutive securities. For periods when we recognize a net loss, diluted earnings per share is equal to basic earnings per share as the impact of assumed conversions of potentially dilutive securities is considered to be antidilutive. We have granted certain stock options, shares of restricted stock, convertible debt instruments and certain other convertible share based payments which have been treated as common share equivalents for purposes of calculating diluted earnings per share for periods in which positive earnings have been reported. Options or other instruments which provide the ability to purchase shares of our common stock that are antidilutive are excluded from the computation of diluted earnings per share. For the three months ended March 31, 2020, our basic and diluted net loss per share attributable to FNF common shareholders are the same because we generated a net loss attributable to FNF common shareholders and the assumed conversions of our potentially dilutive securities would have an antidilutive impact. There were three million antidilutive securities outstanding during the three months ended March 31, 2020. There were no antidilutive instruments outstanding during the three months ended March 31, 2019. Recent Accounting Pronouncements Adopted Pronouncements In June 2016, the FASB issued ASU No. 2016-13 Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments (Topic 326). The amendments in this ASU introduce broad changes to accounting for credit impairment of financial instruments. The primary updates include the introduction of a new current expected credit loss ("CECL") model that is based on expected rather than incurred losses and amendments to the accounting for impairment of fixed maturity securities available for sale. The method used to measure estimated credit losses for fixed maturity available-for-sale securities will be unchanged from current GAAP; however, the amendments require credit losses to be recognized through an allowance rather than as a reduction to the amortized cost of those securities. We adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost. Results for reporting period beginning after December 15, 2019 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable Generally Accepted Accounting Principles. We adopted this standard using the prospective transition approach for debt securities for which other than temporary impairment had been recognized prior to January 1, 2020. As a result, the amortized cost basis remains the same before and after the effective date of ASC 326. The effective interest rate on these debt securities was not changed. Amounts previously recognized in accumulated other comprehensive income as of January 1, 2020 relating to improvements in cash flows expected to be collected will be accreted into income over the remaining life of the asset. Recoveries of amounts previously written off relating to improvements in cash flows after January 1, 2020 will be recorded in earnings when received. We did not record a cumulative-effect adjustment to the opening balance of retained earnings upon adoption of this standard in the current quarter as the impact was not material. The overall effect of Topic 326 was not material to the Consolidated Financial Statements upon adoption. See Note D. Investments for further discussion of the adoption as it relates to our fixed maturity securities available for sale. In January 2017, the FASB issued ASU 2017-04 Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The guidance simplifies the measurement of goodwill impairment by removing step 2 of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. We have adopted this standard as of January 1, 2020 and are applying this guidance on a prospective basis. The overall effect of Topic 350 was not material to the Consolidated Financial Statements upon adoption. Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU 2019-12 Income Taxes - Simplifying the Accounting for Income Taxes (Topic 740), which simplifies various aspects of the income tax accounting guidance and will be applied using different approaches depending on what the specific amendment relates to and, for public entities, are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020. Early adoption is permitted. We do not expect this guidance to have a material impact on our Consolidated Financial Statements and related disclosures upon adoption. |
Summary of Reserve for Claims L
Summary of Reserve for Claims Losses | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Summary of Reserve for Claim Losses | Summary of Reserve for Claim Losses A summary of the reserve for claim losses follows: Three months ended March 31, 2020 2019 (Dollars in millions) Beginning balance $ 1,509 $ 1,488 Change in reinsurance recoverable (1) (1) Claim loss provision related to: Current year 58 45 Prior years — — Total title claim loss provision 58 45 Claims paid, net of recoupments related to: Current year — (1) Prior years (48) (48) Total title claims paid, net of recoupments (48) (49) Ending balance of claim loss reserve for title insurance $ 1,518 $ 1,483 Provision for title insurance claim losses as a percentage of title insurance premiums 4.5 % 4.5 % Five lawsuits have been filed by various parties against Chicago Title Company and Chicago Title Insurance Company as its alter ego (collectively, the “Named Companies”), among others. Generally, plaintiffs claim they are investors who were solicited by Gina Champion-Cain to provide funds that purportedly were to be used for high-interest, short-term loans to parties seeking to acquire California alcoholic beverage licenses. Plaintiffs contend that under California state law, alcoholic beverage license applicants are required to escrow an amount equal to the license purchase price while their applications remain pending with the State. It is further alleged that Chicago Title Company participated with Ms. Champion-Cain and her entities in a fraud scheme involving an escrow account maintained by Chicago Title Company into which the plaintiffs’ funds were deposited. The five lawsuits are as follows: On October 22, 2019, a lawsuit styled, Ovation Fin. Holdings 2 LLC, Ovation Fund Mgmt. II, LLC, Banc of California, N.A. v. Chicago Title Ins. Co., Chicago Title Co ., was filed in the United States District Court for the Southern District of California. Plaintiffs claim losses of more than $75 million as a result of the alleged fraud scheme, and also seek consequential, treble, and punitive damages. The Named Companies are defending and have filed a motion to dismiss the complaint on several grounds, or alternatively, to stay the case. On November 5, 2019, a putative class action lawsuit styled, Blake E. Allred and Melissa M. Allred v. Chicago Title Co., Chicago Title Ins. Co., Adelle E. Ducharme, Betty Elixman, Gina Champion-Cain, Joelle Hanson, Cris Torres, and Rachel Bond , was filed in the United States District Court for the Southern District of California. Plaintiffs seek class certification and consequential, treble, and punitive damages. The Named Companies are defending and have filed a motion to dismiss the complaint on several grounds, or alternatively, to stay the case. On December 13, 2019, a lawsuit styled, Kim Funding, LLC, Kim H. Peterson, Joseph J. Cohen, and ABC Funding Strategies, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman , was filed in the Superior Court of San Diego County for the State of California. Plaintiffs claim losses of more than $250 million as a result of the alleged fraud scheme, and also seek statutory, treble, and punitive damages. The Named Companies are defending and have filed a motion to dismiss the complaint on several grounds. On March 6, 2020, a lawsuit styled, Wakefield Capital, LLC, Wakefield Investments, LLC, 2Budz Holding, LLC, Doug and Kristine Heidrich, and Jeff and Heidi Orr v. Chicago Title Co. and Chicago Title Ins. Co. , was filed in the Superior Court of San Diego County for the State of California. Plaintiffs claim losses in excess of $7.8 million as a result of the alleged fraud scheme, and also seek punitive damages, recovery of attorneys’ fees, and disgorgement. The Company is investigating and will file its response on or before the due date. On March 16, 2020, a lawsuit styled, Randolph L. Levin, et al., v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, Betty Elixman, et al ., was filed in the Superior Court of San Diego County for the State of California. Plaintiffs claim losses in excess of $38 million as a result of the alleged fraud scheme, and also seek punitive damages and the recovery of attorneys’ fees. The Company is investigating and will file its response on or before the due date. In addition, the Chicago Title Company is also in receipt of a pre-suit demand for approximately $30 million from another group of alleged investors. Chicago Title Company has acknowledged receipt of the claim and is investigating. At this time, the Company is unable to ascertain its liability, if any, and is unable to make an estimate of a reasonably possible claim loss for any of these claims due to the complex nature of the claims and litigation, the early procedural status of each claim (involving unresolved questions of fact without any rulings on the merits or determinations of liability), the extent of discovery not yet conducted, potential insurance coverage, and an incomplete evaluation of possible defenses, counterclaims, crossclaims or third-party claims that may exist. Moreover, it is likely that in some instances, the claims listed above are duplicative. The Company, however, has recorded an incurred claim loss reserve for legal fees related to these matters as of March 31, 2020, which is included in its consolidated reserve for claim losses. As further information becomes available, the Company will continue to evaluate the adequacy of its consolidated reserve for claim losses. We continually upda te loss reserve estimates as new information becomes known, new loss patterns emerge or as other contributing factors are considered and incorporated into the analysis of reserve for claim losses. Estimating future title loss payments is difficult because of the complex nature of title claims, the long periods of time over which claims are paid, significantly varying dollar amounts of individual claims and other factors. Due to the uncertainty inherent in the process and to the judgment used by management, the ultimate liability may be greater or less than our current reserves. If actual claims loss development varies from what is currently expected and is not offset by other factors, it is possible that additional reserve adjustments may be required in future periods in order to maintain our recorded reserve within a reasonable range of our actuary's central estimate. |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019, respectively: March 31, 2020 Level 1 Level 2 Level 3 Total (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ — $ 278 $ — $ 278 State and political subdivisions — 92 — 92 Corporate debt securities — 1,553 14 1,567 Mortgage-backed/asset-backed securities — 63 — 63 Foreign government bonds — 57 — 57 Preferred securities 141 163 — 304 Equity securities 627 — 1 628 Other long-term investments 59 — — 59 Total assets $ 827 $ 2,206 $ 15 $ 3,048 December 31, 2019 Level 1 Level 2 Level 3 Total (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ — $ 288 $ — $ 288 State and political subdivisions — 93 — 93 Corporate debt securities — 1,570 17 1,587 Mortgage-backed/asset-backed securities — 62 — 62 Foreign government bonds — 60 — 60 Preferred securities 65 258 — 323 Equity securities 810 — 1 811 Other long-term investments — — 120 120 Total assets $ 875 $ 2,331 $ 138 $ 3,344 Our Level 2 fair value measures for preferred securities and fixed maturity securities available for sale are provided by a third-party pricing service. We utilize one firm for our preferred stock and our bond portfolios . The pricing service is a leading global provider of financial market data, analytics and related services to financial institutions. The inputs utilized in these pricing methodologies include observable measures such as benchmark yields, reported trades, broker dealer quotes, issuer spreads, two sided markets, benchmark securities, bids, offers and reference data including market research publications. We review the pricing methodologies for all of our Level 2 securities by obtaining an understanding of the valuation models and assumptions used by the third-party as well as independently comparing the resulting prices to other publicly available measures of fair value and internally developed models. The pricing methodologies used by the relevant third-party pricing services are as follows: • U.S. government and agencies: These securities are valued based on data obtained for similar securities in active markets and from inter-dealer brokers. • State and political subdivisions: These securities are valued based on data obtained for similar securities in active markets and from inter-dealer brokers. Factors considered include relevant trade information, dealer quotes and other relevant market data. • Corporate debt securities: These securities are valued based on dealer quotes and related market trading activity. Factors considered include the bond's yield, its terms and conditions, or any other feature which may influence its risk and thus marketability, as well as relative credit information and relevant sector news. • Foreign government bonds: These securities are valued based on a discounted cash flow model incorporating observable market inputs such as available broker quotes and yields of comparable securities. • Mortgage-backed/asset-backed securities: These securities are comprised of commercial mortgage-backed securities, agency mortgage-backed securities, collateralized mortgage obligations and asset-backed securities. They are valued based on available trade information, dealer quotes, cash flows, relevant indices and market data for similar assets in active markets. • Preferred securities: Preferred securities are valued by calculating the appropriate spread over a comparable U.S. Treasury security. Inputs include benchmark quotes and other relevant market data. Our Level 3 fair value measures for our other long-term investment were provided by a third-party pricing service. We utilized one firm to value our Level 3 other long-term investment. The pricing service is a leading global provider of financial market data, analytics and related services to financial institutions. We utilized the income approach and a discounted cash flow analysis in determining the fair value of our Level 3 other long-term investment. The primary unobservable input utilized in this pricing methodology is the discount rate used which is determined based on underwriting yield, credit spreads, yields on benchmark indices and comparable public company debt. The discount rate used in our determination of the fair value of our Level 3 other long-term investment as of December 31, 2019 was a range of 6.8% - 7.4% and a weighted-average of 7.0% . Base d on the total fair value of our Level 3 other long-term investment as of December 31, 2019, changes in the discount rate utilized will not result in a fair value significantly different than the amount recorded. Our remaining Level 3 fair value measures for our equity and corporate debt securities relate to multiple investments which are considered immaterial individually and in the aggregate. The following table presents a summary of the changes in the fair values of Level 3 assets, measured on a recurring basis, for the three-month periods ended March 31, 2020 and 2019. Three months ended March 31, 2020 Three months ended March 31, 2019 Other Long-Term Equity Corporate Debt Other Long-Term Corporate Debt Investment Securities Securities Total Investment Securities Total (In millions) (In millions) Fair value, beginning balance $ 120 $ 1 $ 17 $ 138 $ 101 $ 17 $ 118 Transfers out of Level 3 (59) — — (59) — (4) (4) Paid-in-kind dividends (1) 2 — — 2 1 1 2 Purchases — — — — — 5 5 Sales and maturities — — — — — (1) (1) Net valuation (loss) gain included in earnings (2) (63) — (3) (66) 5 — 5 Fair value, ending balance $ — $ 1 $ 14 $ 15 $ 107 $ 18 $ 125 _____________________________________ (1) Included in Interest and investment income on the Condensed Consolidated Statements of Earnings (2) Included in Realized gains and losses, net on the Condensed Consolidated Statements of Earnings Transfers into or out of the Level 3 fair value category occur when unobservable inputs become more or less significant to the fair value measurement or upon a change in valuation technique. For the three months ended March 31, 2020, we transferred $59 million of other long-term investments from Level 3 to Level 1 based on a change in valuation technique. For the three months ended March 31, 2019, transfers out of Level 3 are not considered material. Substantially all of the unrealized gain (loss) on investments and other financial instruments, net (excluding investments in unconsolidated affiliates) on our Condensed Consolidated Statements of Comprehensive Income relate to fixed maturity securities which are considered Level 2 fair value measures. The carrying amounts of short-term investments, accounts receivable and notes receivable approximate fair value due to their short-term nature and/or short time period since consummation. Additional information regarding the fair value of our investment portfolio is included in Note D. Investments |
Investments
Investments | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Beginning January 1, 2020, unrealized losses are evaluated to determine whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, adverse conditions specifically related to the security and changes to the rating of the security by a rating agency, among other factors, including the correlation between changes in the price of certain comparable benchmark indices and the security. If credit losses exist, an allowance for credit losses is recorded for the credit losses limited by the amount that the fair value is less than the amortized cost. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income. Such reviews are inherently uncertain and the value of the investment may not fully recover or may decline in future periods resulting in additional losses. The cost basis of fixed maturity securities available for sale includes an adjustment for amortized premium or accreted discount since the date of purchase. The fair values of our available for sale securities at March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 Cost Unrealized Unrealized Allowance for Fair Basis Gains Losses Credit Loss Value (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ 265 $ 13 $ — $ — $ 278 State and political subdivisions 90 2 — — 92 Corporate debt securities 1,547 42 (11) (11) 1,567 Mortgage-backed/asset-backed securities 60 3 — — 63 Foreign government bonds 63 — (6) — 57 Total $ 2,025 $ 60 $ (17) $ (11) $ 2,057 December 31, 2019 Cost Unrealized Unrealized Fair Basis Gains Losses Value (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ 282 $ 7 $ (1) $ 288 State and political subdivisions 90 3 — 93 Corporate debt securities 1,536 54 (3) 1,587 Mortgage-backed/asset-backed securities 60 2 — 62 Foreign government bonds 61 1 (2) 60 Total $ 2,029 $ 67 $ (6) $ 2,090 The following table presents certain information regarding contractual maturities of our fixed maturity securities at March 31, 2020: March 31, 2020 Amortized % of Fair % of Maturity Cost Total Value Total (Dollars in millions) One year or less $ 319 16 % $ 315 15 % After one year through five years 1,104 54 1,112 55 After five years through ten years 421 21 442 21 After ten years 121 6 125 6 Mortgage-backed/asset-backed securities 60 3 63 3 Total $ 2,025 100 % $ 2,057 100 % Expected maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Because of the potential for prepayment on mortgage-backed and asset-backed securities, they are not categorized by contractual maturity. Net unrealized losses on investment securities for which the allowance for credit losses has not been recorded and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2020 were as follows: March 31, 2020 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses Corporate debt securities $ 404 $ (9) $ 45 $ (2) $ 449 $ (11) Foreign government bonds 36 (2) 20 (4) 56 (6) Total temporarily impaired securities $ 440 $ (11) $ 65 $ (6) $ 505 $ (17) Unrealized losses on corporate bonds have not been recognized into income because the issuers bonds are of high credit quality (rated AA or higher), management does not intend to and it is likely that management will not be required to sell the securities prior to their anticipated recovery and the decline in fair value is largely due to changes in interest rates and other market conditions. The issuers continue to make timely principal and interest payment on the bonds. The fair value is expected to recover as the bonds approach maturity. Net unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2019, were as follows: December 31, 2019 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. government and agencies $ 62 $ (1) $ — $ — $ 62 $ (1) Corporate debt securities 98 (2) 51 (1) 149 (3) Foreign government bonds — — 33 (2) 33 (2) Total temporarily impaired securities $ 160 $ (3) $ 84 $ (3) $ 244 $ (6) During the three months ended March 31, 2020, we recorded impairment charges of $11 million related to our corporate debt securities. We recorded no impairments relating to our investments during the three months ended March 31, 2019. It is possible that future events may lead us to recognize impairment losses related to our investment portfolio and that unanticipated future events may lead us to dispose of certain investment holdings and recognize the effects of any market movements in our condensed consolidated financial statements. The following tables present realized gains and losses on investments and other assets and proceeds from the sale or maturity of investments and other assets for the three-month periods ended March 31, 2020 and 2019, respectively: Three months ended March 31, 2020 Gross Realized Gains Gross Realized Losses Allowance for Credit Losses Net Realized Gains (Losses) Gross Proceeds from Sale/Maturity (In millions) Sales and maturities of fixed maturity securities available for sale $ 12 $ (1) $ — $ 11 $ 177 Sales and maturities of preferred securities — — — — 83 Sales of equity securities — — — — — Valuation of fixed maturity securities available for sale (11) (11) — Valuation of equity securities — (205) — Valuation of preferred securities — (42) — Valuation of other long term investments — (63) — Other realized gains and losses, net — (10) 9 Total $ (11) $ (320) $ 269 Three months ended March 31, 2019 Gross Realized Gains Gross Realized Losses Net Realized Gains (Losses) Gross Proceeds from Sale/Maturity (In millions) Sales and maturities of fixed maturity securities available for sale $ 1 $ (1) $ — $ 235 Sales and maturities of preferred securities — — — 24 Sales of equity securities 4 — 4 41 Valuation of equity securities 126 — Valuation of preferred securities 11 — Valuation of other long term investments 5 — Impairment of lease assets (4) — Total $ 142 $ 300 Investment with Related Party Included in equity securities as of March 31, 2020 and December 31, 2019 are 5,706,134 shares of Cannae common stock (NYSE: CNNE) which were purchased during the fourth quarter of 2017 in connection with the split-off of our former portfolio company investments to Cannae. The fair value of our related party investment based on quoted market prices is $191 million and $212 million as of March 31, 2020 and December 31, 2019, respectively. |
Notes Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Notes Payable | Notes Payable Notes payable consists of the following: March 31, December 31, (In millions) 4.50% Notes, net of discount $ 443 $ 443 5.50% Notes, net of discount 398 398 Revolving Credit Facility (2) (3) $ 839 $ 838 At March 31, 2020, the estimated fair value of our unsecured notes payable was approximately $955 million, which was $104 million higher than its carrying value, excluding $12 million of net unamortized debt issuance costs and discount. The fair values of our unsecured notes payable are based on established market prices for the securities on March 31, 2020 and are considered Level 2 financial liabilities. On August 13, 2018, we completed an offering of $450 million in aggregate principal amount of 4.50% notes due August 2028 (the "4.50% Notes"), pursuant to Rule 144A and Regulation S under the Securities Act of 1933, as amended. The 4.50% Notes were priced at 99.252% of par to yield 4.594% annual interest. We pay interest on the 4.50% Notes semi-annually on the 15th of February and August, beginning February 15, 2019. The 4.50% Notes contain customary covenants and events of default for investment grade public debt, which primarily relate to failure to make principal or interest payments. On May 16, 2019, we completed an offering to exchange the 4.50% Notes for substantially identical notes registered pursuant to Rule 424 under the Securities Act of 1933 (the "4.50% Notes Exchange"). There were no material changes to the terms of the 4.50% Notes as a result of the 4.50% Notes Exchange and all holders of the 4.50% Notes accepted the offer to exchange. On April 27, 2017, we entered into a Fourth Amended and Restated Credit Agreement that provides for our $800 million revolving credit facility (the Revolving Credit Facility) with Bank of America, N.A., as administrative agent and the other agents party thereto (the "Restated Credit Agreement").The material terms of the Restated Credit Agreement are set forth in our Annual Report for the year ended December 31, 2019. As of March 31, 2020, there was no principal outstanding, $2 million of unamortized debt issuance costs, and $800 million of available borrowing capacity under the Revolving Credit Facility. On August 28, 2012, we completed an offering of $400 million in aggregate principal amount of 5.50% notes due September 2022 (the "5.50% Notes"), pursuant to an effective registration statement previously filed with the Securities and Exchange Commission ("SEC"). The material terms of the 5.50% Notes are set forth in our Annual Report for the year ended December 31, 2019. Gross principal maturities of notes payable at March 31, 2020 are as follows (in millions): 2020 (remaining) $ — 2021 — 2022 400 2023 — 2024 — Thereafter 450 $ 850 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Legal and Regulatory Contingencies In the ordinary course of business, we are involved in various pending and threatened litigation matters related to our operations, some of which include claims for punitive or exemplary damages. With respect to our title insurance operations, this customary litigation includes but is not limited to a wide variety of cases arising out of or related to title and escrow claims, for which we make provisions through our loss reserves. See Note B. Summary of Reserve for Claim Losses for further discussion. Additionally, like other companies, our ordinary course litigation includes a number of class action and purported class action lawsuits, which make allegations related to aspects of our operations. We believe that no actions, other than the matters discussed below, if any, depart from customary litigation incidental to our business. We review lawsuits and other legal and regulatory matters (collectively “legal proceedings”) on an ongoing basis when making accrual and disclosure decisions. When assessing reasonably possible and probable outcomes, management bases its decision on its assessment of the ultimate outcome assuming all appeals have been exhausted. For legal proceedings in which it has been determined that a loss is both probable and reasonably estimable, a liability based on known facts and which represents our best estimate has been recorded. Our accrual for legal and regulatory matters was $22 million as of March 31, 2020 and December 31, 2019. None of the amounts we have currently recorded are considered to be material to our financial condition individually or in the aggregate. Actual losses may materially differ from the amounts recorded and the ultimate outcome of our pending legal proceedings is generally not yet determinable. While some of these matters could be material to our operating results or cash flows for any particular period if an unfavorable outcome results, at present we do not believe that the ultimate resolution of currently pending legal proceedings, either individually or in the aggregate, will have a material adverse effect on our financial condition. In a class action captioned, Patterson, et al. v. Fidelity National Title Insurance Company, et al ., originally filed on October 27, 2003, and pending in the Court of Common Pleas of Allegheny County, Pennsylvania, plaintiffs allege the named Company underwriters violated Pennsylvania’s Unfair Trade Practices and Consumer Protection Law (“UTPCPL”) by failing to provide premium discounts in accordance with filed rates in refinancing transactions. Contrary to rulings in similar federal court cases that considered the rate rule and agreed with the Company’s position, the court held that the rate rule should be interpreted such that an institutional mortgage in the public record is a “proxy” for prior title insurance entitling a consumer to a discount rate when refinancing when there is a mortgage of record within the number of years required by the rate rule. The rate rule requires sufficient evidence of a prior policy, and because not all institutional mortgages were insured, the Company’s position is that a recorded first mortgage alone does not constitute sufficient evidence of an earlier policy entitling consumers to a discounted rate. The court certified the class refusing to follow prior Pennsylvania Supreme Court and appellate court decisions holding that the UTPCPL requires proof of reliance, an individual issue that precludes certification. After notice to the class, plaintiffs moved for partial summary judgment on liability, and defendants moved for summary judgment. On June 27, 2018, the court entered an order granting plaintiffs’ motion for partial summary judgment on liability, and denying the Company’s motion. The court also determined that a multiplier of 1.5, not treble, should be applied to the amount of damages, if any, proven by class members at trial, and that Plaintiffs should bear the responsibility of identifying class members and calculating damages. The Company’s requests for interlocutory appeals of both the liability and damage multiplier issues were denied. The parties executed a written settlement agreement and received preliminary approval. Notice must now be given, and the class action settlement administrator will follow the claims process. We do not believe the settlement will have a material adverse effect on our financial condition. From time to time we receive inquiries and requests for information from state insurance departments, attorneys general and other regulatory agencies about various matters relating to our business. Sometimes these take the form of civil investigative demands or subpoenas. We cooperate with all such inquiries and we have responded to or are currently responding to inquiries from multiple governmental agencies. Also, regulators and courts have been dealing with issues arising from foreclosures and related processes and documentation. Various governmental entities are studying the title insurance product, market, pricing, and business practices, and potential regulatory and legislative changes, which may materially affect our business and operations. From time to time, we are assessed fines for violations of regulations or other matters or enter into settlements with such authorities which may require us to pay fines or claims or take other actions. We do not anticipate such fines and settlements, either individually or in the aggregate, will have a material adverse effect on our financial condition. |
Dividends
Dividends | 3 Months Ended |
Mar. 31, 2020 | |
Equity [Abstract] | |
Dividends | DividendsOn April 22, 2020, our Board of Directors declared cash dividends of $0.33 per share, payable on June 30, 2020, to FNF common shareholders of record as of June 16, 2020. |
Segment Information
Segment Information | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information Summarized financial information concerning our reportable segments is shown in the following tables. As of and for the three months ended March 31, 2020: Title Corporate and Other Total (In millions) Title premiums $ 1,278 $ — $ 1,278 Other revenues 610 (9) 601 Revenues from external customers 1,888 (9) 1,879 Interest and investment income, including realized gains and losses (265) (2) (267) Total revenues 1,623 (11) 1,612 Depreciation and amortization 37 6 43 Interest expense — 12 12 Loss before income taxes and equity in earnings of unconsolidated affiliates (53) (33) (86) Income tax benefit (19) (9) (28) Loss before equity in earnings of unconsolidated affiliates (34) (24) (58) Equity in earnings of unconsolidated affiliates 1 — 1 Net loss $ (33) $ (24) $ (57) Assets $ 8,728 $ 1,476 $ 10,204 Goodwill 2,460 266 2,726 As of and for the three months ended March 31, 2019: Title Corporate and Other Total (In millions) Title premiums $ 992 $ — $ 992 Other revenues 481 53 534 Revenues from external customers 1,473 53 1,526 Interest and investment income, including realized gains and losses 190 6 196 Total revenues 1,663 59 1,722 Depreciation and amortization 39 5 44 Interest expense — 12 12 Earnings (loss) before income taxes and equity in earnings of unconsolidated affiliates 292 (28) 264 Income tax expense (benefit) 71 (6) 65 Earnings (loss) before equity in earnings of unconsolidated affiliates 221 (22) 199 Equity in earnings of unconsolidated affiliates 7 — 7 Net earnings (loss) $ 228 $ (22) $ 206 Assets $ 8,567 $ 1,080 $ 9,647 Goodwill 2,463 264 2,727 The activities in our segments include the following: • Title. This segment consists of the operations of our title insurance underwriters and related businesses. This segment provides core title insurance and escrow and other title-related services including trust activities, trustee sales guarantees, and home warranty products. This segment also includes our transaction services business, which includes other title-related services used in the production and management of mortgage loans, including mortgage loans that experience default. • Corporate and Other. This segment consists of the operations of the parent holding company, our real estate technology subsidiaries and our remaining real estate brokerage businesses. This segment also includes certain other unallocated corporate overhead expenses and eliminations of revenues and expenses between it and our Title segment. |
Revenue Recognition
Revenue Recognition | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Revenue Recognition Disaggregation of Revenue Our revenue consists of: Three months ended March 31, 2020 2019 Revenue Stream Income Statement Classification Segment Total Revenue Revenue from insurance contracts: (in millions) Direct title insurance premiums Direct title insurance premiums Title $ 546 $ 440 Agency title insurance premiums Agency title insurance premiums Title 732 552 Home warranty Escrow, title-related and other fees Title 43 41 Total revenue from insurance contracts 1,321 1,033 Revenue from contracts with customers: Escrow fees Escrow, title-related and other fees Title 221 165 Other title-related fees and income Escrow, title-related and other fees Title 159 136 ServiceLink, excluding title premiums, escrow fees, and subservicing fees Escrow, title-related and other fees Title 106 83 Real estate technology Escrow, title-related and other fees Corporate and other 27 25 Real estate brokerage Escrow, title-related and other fees Corporate and other 6 7 Other Escrow, title-related and other fees Corporate and other (42) 21 Total revenue from contracts with customers 477 437 Other revenue: Loan subservicing revenue Escrow, title-related and other fees Title 81 56 Interest and investment income Interest and investment income Various 53 54 Realized gains and losses, net Realized gains and losses, net Various (320) 142 Total revenues Total revenues $ 1,612 $ 1,722 Our Direct title insurance premiums are recognized as revenue at the time of closing of the underlying transaction as the earnings process is then considered complete. Regulation of title insurance rates varies by state. Premiums are charged to customers based on rates predetermined in coordination with each states' respective Department of Insurance. Cash associated with such revenue is typically collected at closing of the underlying real estate transaction. Premium revenues from agency title operations are recognized when the underlying title order and transaction closing, if applicable, are complete. Revenues from our home warranty business are generated from contracts with customers to provide warranty for major home appliances. Substantially all of our home warranty contracts are one year in length and revenue is recognized ratably over the term of the contract. Escrow fees and Other title-related fees and income in our Title segment are closely related to Direct title insurance premiums and are primarily associated with managing the closing of real estate transactions including the processing of funds on behalf of the transaction participants, gathering and recording the required closing documents, providing notary and home inspection services, and other real estate or title-related activities. Revenue is primarily recognized upon closing of the underlying real estate transaction or completion of services. Cash associated with such revenue is typically collected at closing. Revenues from ServiceLink, excluding its title premiums, escrow fees and loan subservicing fees primarily include revenues from real estate appraisal services and foreclosure processing and facilitation services. Revenues from real estate appraisal services are recognized when all appraisal work is complete, a final report is issued to the client and the client is billed. Revenues from foreclosure processing and facilitation services are primarily recognized upon completion of the services and when billing to the client is complete. Real estate technology revenues are primarily comprised of subscription fees for use of software provided to real estate professionals. Subscriptions are only offered on a month-by-month basis and fees are billed monthly. Revenue is recognized in the month services are provided. Real estate brokerage revenues are primarily comprised of commission revenues earned in association with the facilitation of real estate transactions and are recognized upon closing of the sale of the underlying real estate transaction. Loan subservicing revenues are generated by certain subsidiaries of ServiceLink and are associated with the servicing of mortgage loans on behalf of its customers. Revenue is recognized when the underlying work is performed and billed. Loan subservicing revenues are subject to the recognition requirements of ASC Topic 860. Interest and investment income consists primarily of interest payments received on fixed maturity security holdings and dividends received on equity and preferred security holdings. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, primarily related to revenue from our home warranty business, and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. Contract Balances The following table provides information about trade receivables and deferred revenue: March 31, 2020 December 31, 2019 (In millions) Trade receivables $ 301 $ 321 Deferred revenue (contract liabilities) 107 111 Deferred revenue is recorded primarily for our home warranty contracts. Revenues from home warranty products are recognized over the life of the policy, which is primarily one year. The unrecognized portion is recorded as deferred revenue in accounts payable and other accrued liabilities in the Condensed Consolidated Balance Sheets. During the three months ended March 31, 2020, we recognized $44 million of revenue which was included in deferred revenue at the beginning of the period. |
Basis of Financial Statements (
Basis of Financial Statements (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Financial Statements | The financial information in this report presented for interim periods is unaudited and includes the accounts of Fidelity National Financial, Inc. and its subsidiaries (collectively, “we,” “us,” “our,” the "Company" or “FNF”) prepared in accordance with U.S. generally accepted accounting principles ("GAAP") and the instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, all adjustments considered necessary for a fair presentation have been included. All adjustments made were of a normal, recurring nature. This report should be read in conjunction with our Annual Report on Form 10-K (our "Annual Report") for the year ended December 31, 2019. |
Earnings Per Share | Earnings Per Share Basic earnings per share, as presented on the Condensed Consolidated Statement of Earnings, is computed by dividing net earnings available to common shareholders in a given period by the weighted average number of common shares outstanding during such period. In periods when earnings are positive, diluted earnings per share is calculated by dividing net earnings available to common shareholders by the weighted average number of common shares outstanding plus the impact of assumed conversions of potentially dilutive securities. For periods when we recognize a net loss, diluted earnings per share is equal to basic earnings per share as the impact of assumed conversions of potentially dilutive securities is considered to be antidilutive. We have granted certain stock options, shares of restricted stock, convertible debt instruments and certain other convertible share based payments which have been treated as common share equivalents for purposes of calculating diluted earnings per share for periods in which positive earnings have been reported. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted Pronouncements In June 2016, the FASB issued ASU No. 2016-13 Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Instruments (Topic 326). The amendments in this ASU introduce broad changes to accounting for credit impairment of financial instruments. The primary updates include the introduction of a new current expected credit loss ("CECL") model that is based on expected rather than incurred losses and amendments to the accounting for impairment of fixed maturity securities available for sale. The method used to measure estimated credit losses for fixed maturity available-for-sale securities will be unchanged from current GAAP; however, the amendments require credit losses to be recognized through an allowance rather than as a reduction to the amortized cost of those securities. We adopted ASC 326 using the modified retrospective method for all financial assets measured at amortized cost. Results for reporting period beginning after December 15, 2019 are presented under ASC 326 while prior period amounts continue to be reported in accordance with previously applicable Generally Accepted Accounting Principles. We adopted this standard using the prospective transition approach for debt securities for which other than temporary impairment had been recognized prior to January 1, 2020. As a result, the amortized cost basis remains the same before and after the effective date of ASC 326. The effective interest rate on these debt securities was not changed. Amounts previously recognized in accumulated other comprehensive income as of January 1, 2020 relating to improvements in cash flows expected to be collected will be accreted into income over the remaining life of the asset. Recoveries of amounts previously written off relating to improvements in cash flows after January 1, 2020 will be recorded in earnings when received. We did not record a cumulative-effect adjustment to the opening balance of retained earnings upon adoption of this standard in the current quarter as the impact was not material. The overall effect of Topic 326 was not material to the Consolidated Financial Statements upon adoption. See Note D. Investments for further discussion of the adoption as it relates to our fixed maturity securities available for sale. In January 2017, the FASB issued ASU 2017-04 Intangibles - Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment. The guidance simplifies the measurement of goodwill impairment by removing step 2 of the goodwill impairment test, which requires the determination of the fair value of individual assets and liabilities of a reporting unit. The new guidance requires goodwill impairment to be measured as the amount by which a reporting unit’s carrying value exceeds its fair value; however, the loss recognized should not exceed the total amount of goodwill allocated to that reporting unit. We have adopted this standard as of January 1, 2020 and are applying this guidance on a prospective basis. The overall effect of Topic 350 was not material to the Consolidated Financial Statements upon adoption. Pronouncements Not Yet Adopted |
Insurance Premiums Revenue Recognition | Our Direct title insurance premiums are recognized as revenue at the time of closing of the underlying transaction as the earnings process is then considered complete. Regulation of title insurance rates varies by state. Premiums are charged to customers based on rates predetermined in coordination with each states' respective Department of Insurance. Cash associated with such revenue is typically collected at closing of the underlying real estate transaction. Premium revenues from agency title operations are recognized when the underlying title order and transaction closing, if applicable, are complete.Revenues from our home warranty business are generated from contracts with customers to provide warranty for major home appliances. Substantially all of our home warranty contracts are one year in length and revenue is recognized ratably over the term of the contract. |
Revenue Recognition, Services, Real Estate Transactions | Escrow fees and Other title-related fees and income in our Title segment are closely related to Direct title insurance premiums and are primarily associated with managing the closing of real estate transactions including the processing of funds on behalf of the transaction participants, gathering and recording the required closing documents, providing notary and home inspection services, and other real estate or title-related activities. Revenue is primarily recognized upon closing of the underlying real estate transaction or completion of services. Cash associated with such revenue is typically collected at closing. Revenues from ServiceLink, excluding its title premiums, escrow fees and loan subservicing fees primarily include revenues from real estate appraisal services and foreclosure processing and facilitation services. Revenues from real estate appraisal services are recognized when all appraisal work is complete, a final report is issued to the client and the client is billed. Revenues from foreclosure processing and facilitation services are primarily recognized upon completion of the services and when billing to the client is complete. Real estate technology revenues are primarily comprised of subscription fees for use of software provided to real estate professionals. Subscriptions are only offered on a month-by-month basis and fees are billed monthly. Revenue is recognized in the month services are provided. Real estate brokerage revenues are primarily comprised of commission revenues earned in association with the facilitation of real estate transactions and are recognized upon closing of the sale of the underlying real estate transaction. Loan subservicing revenues are generated by certain subsidiaries of ServiceLink and are associated with the servicing of mortgage loans on behalf of its customers. Revenue is recognized when the underlying work is performed and billed. Loan subservicing revenues are subject to the recognition requirements of ASC Topic 860. |
Revenue Recognition, Other | Interest and investment income consists primarily of interest payments received on fixed maturity security holdings and dividends received on equity and preferred security holdings. We do not disclose the value of unsatisfied performance obligations for (i) contracts with an original expected length of one year or less, primarily related to revenue from our home warranty business, and (ii) contracts for which we recognize revenue at the amount to which we have the right to invoice for services performed. |
Summary of Reserve for Claim Lo
Summary of Reserve for Claim Losses (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Summary of the Reserve for Claim Losses | A summary of the reserve for claim losses follows: Three months ended March 31, 2020 2019 (Dollars in millions) Beginning balance $ 1,509 $ 1,488 Change in reinsurance recoverable (1) (1) Claim loss provision related to: Current year 58 45 Prior years — — Total title claim loss provision 58 45 Claims paid, net of recoupments related to: Current year — (1) Prior years (48) (48) Total title claims paid, net of recoupments (48) (49) Ending balance of claim loss reserve for title insurance $ 1,518 $ 1,483 Provision for title insurance claim losses as a percentage of title insurance premiums 4.5 % 4.5 % |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | The following table presents the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of March 31, 2020 and December 31, 2019, respectively: March 31, 2020 Level 1 Level 2 Level 3 Total (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ — $ 278 $ — $ 278 State and political subdivisions — 92 — 92 Corporate debt securities — 1,553 14 1,567 Mortgage-backed/asset-backed securities — 63 — 63 Foreign government bonds — 57 — 57 Preferred securities 141 163 — 304 Equity securities 627 — 1 628 Other long-term investments 59 — — 59 Total assets $ 827 $ 2,206 $ 15 $ 3,048 December 31, 2019 Level 1 Level 2 Level 3 Total (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ — $ 288 $ — $ 288 State and political subdivisions — 93 — 93 Corporate debt securities — 1,570 17 1,587 Mortgage-backed/asset-backed securities — 62 — 62 Foreign government bonds — 60 — 60 Preferred securities 65 258 — 323 Equity securities 810 — 1 811 Other long-term investments — — 120 120 Total assets $ 875 $ 2,331 $ 138 $ 3,344 |
Fair Values of Level 3 Assets Measured on Recurring Basis | The following table presents a summary of the changes in the fair values of Level 3 assets, measured on a recurring basis, for the three-month periods ended March 31, 2020 and 2019. Three months ended March 31, 2020 Three months ended March 31, 2019 Other Long-Term Equity Corporate Debt Other Long-Term Corporate Debt Investment Securities Securities Total Investment Securities Total (In millions) (In millions) Fair value, beginning balance $ 120 $ 1 $ 17 $ 138 $ 101 $ 17 $ 118 Transfers out of Level 3 (59) — — (59) — (4) (4) Paid-in-kind dividends (1) 2 — — 2 1 1 2 Purchases — — — — — 5 5 Sales and maturities — — — — — (1) (1) Net valuation (loss) gain included in earnings (2) (63) — (3) (66) 5 — 5 Fair value, ending balance $ — $ 1 $ 14 $ 15 $ 107 $ 18 $ 125 _____________________________________ (1) Included in Interest and investment income on the Condensed Consolidated Statements of Earnings (2) Included in Realized gains and losses, net on the Condensed Consolidated Statements of Earnings |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Carrying Amount and Fair Value of Available-for-sale Securities | The fair values of our available for sale securities at March 31, 2020 and December 31, 2019 are as follows: March 31, 2020 Cost Unrealized Unrealized Allowance for Fair Basis Gains Losses Credit Loss Value (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ 265 $ 13 $ — $ — $ 278 State and political subdivisions 90 2 — — 92 Corporate debt securities 1,547 42 (11) (11) 1,567 Mortgage-backed/asset-backed securities 60 3 — — 63 Foreign government bonds 63 — (6) — 57 Total $ 2,025 $ 60 $ (17) $ (11) $ 2,057 December 31, 2019 Cost Unrealized Unrealized Fair Basis Gains Losses Value (In millions) Fixed maturity securities available for sale: U.S. government and agencies $ 282 $ 7 $ (1) $ 288 State and political subdivisions 90 3 — 93 Corporate debt securities 1,536 54 (3) 1,587 Mortgage-backed/asset-backed securities 60 2 — 62 Foreign government bonds 61 1 (2) 60 Total $ 2,029 $ 67 $ (6) $ 2,090 |
Investments Classified by Contractual Maturity Dates | The following table presents certain information regarding contractual maturities of our fixed maturity securities at March 31, 2020: March 31, 2020 Amortized % of Fair % of Maturity Cost Total Value Total (Dollars in millions) One year or less $ 319 16 % $ 315 15 % After one year through five years 1,104 54 1,112 55 After five years through ten years 421 21 442 21 After ten years 121 6 125 6 Mortgage-backed/asset-backed securities 60 3 63 3 Total $ 2,025 100 % $ 2,057 100 % |
Unrealized Losses on Investment Securities and Fair Value, Excluding Allowance for Credit Losses | Net unrealized losses on investment securities for which the allowance for credit losses has not been recorded and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at March 31, 2020 were as follows: March 31, 2020 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses Corporate debt securities $ 404 $ (9) $ 45 $ (2) $ 449 $ (11) Foreign government bonds 36 (2) 20 (4) 56 (6) Total temporarily impaired securities $ 440 $ (11) $ 65 $ (6) $ 505 $ (17) |
Schedule of Unrealized Losses on Investment Securities and the Fair Value | Net unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position at December 31, 2019, were as follows: December 31, 2019 Less than 12 Months 12 Months or Longer Total Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses U.S. government and agencies $ 62 $ (1) $ — $ — $ 62 $ (1) Corporate debt securities 98 (2) 51 (1) 149 (3) Foreign government bonds — — 33 (2) 33 (2) Total temporarily impaired securities $ 160 $ (3) $ 84 $ (3) $ 244 $ (6) |
Realized Gains and Losses and Proceeds From Sales on Investments and Other Assets | The following tables present realized gains and losses on investments and other assets and proceeds from the sale or maturity of investments and other assets for the three-month periods ended March 31, 2020 and 2019, respectively: Three months ended March 31, 2020 Gross Realized Gains Gross Realized Losses Allowance for Credit Losses Net Realized Gains (Losses) Gross Proceeds from Sale/Maturity (In millions) Sales and maturities of fixed maturity securities available for sale $ 12 $ (1) $ — $ 11 $ 177 Sales and maturities of preferred securities — — — — 83 Sales of equity securities — — — — — Valuation of fixed maturity securities available for sale (11) (11) — Valuation of equity securities — (205) — Valuation of preferred securities — (42) — Valuation of other long term investments — (63) — Other realized gains and losses, net — (10) 9 Total $ (11) $ (320) $ 269 Three months ended March 31, 2019 Gross Realized Gains Gross Realized Losses Net Realized Gains (Losses) Gross Proceeds from Sale/Maturity (In millions) Sales and maturities of fixed maturity securities available for sale $ 1 $ (1) $ — $ 235 Sales and maturities of preferred securities — — — 24 Sales of equity securities 4 — 4 41 Valuation of equity securities 126 — Valuation of preferred securities 11 — Valuation of other long term investments 5 — Impairment of lease assets (4) — Total $ 142 $ 300 |
Notes Payable (Tables)
Notes Payable (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Notes Payable | Notes payable consists of the following: March 31, December 31, (In millions) 4.50% Notes, net of discount $ 443 $ 443 5.50% Notes, net of discount 398 398 Revolving Credit Facility (2) (3) $ 839 $ 838 |
Schedule of Principal Maturities of Notes Payable | Gross principal maturities of notes payable at March 31, 2020 are as follows (in millions): 2020 (remaining) $ — 2021 — 2022 400 2023 — 2024 — Thereafter 450 $ 850 |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | Summarized financial information concerning our reportable segments is shown in the following tables. As of and for the three months ended March 31, 2020: Title Corporate and Other Total (In millions) Title premiums $ 1,278 $ — $ 1,278 Other revenues 610 (9) 601 Revenues from external customers 1,888 (9) 1,879 Interest and investment income, including realized gains and losses (265) (2) (267) Total revenues 1,623 (11) 1,612 Depreciation and amortization 37 6 43 Interest expense — 12 12 Loss before income taxes and equity in earnings of unconsolidated affiliates (53) (33) (86) Income tax benefit (19) (9) (28) Loss before equity in earnings of unconsolidated affiliates (34) (24) (58) Equity in earnings of unconsolidated affiliates 1 — 1 Net loss $ (33) $ (24) $ (57) Assets $ 8,728 $ 1,476 $ 10,204 Goodwill 2,460 266 2,726 As of and for the three months ended March 31, 2019: Title Corporate and Other Total (In millions) Title premiums $ 992 $ — $ 992 Other revenues 481 53 534 Revenues from external customers 1,473 53 1,526 Interest and investment income, including realized gains and losses 190 6 196 Total revenues 1,663 59 1,722 Depreciation and amortization 39 5 44 Interest expense — 12 12 Earnings (loss) before income taxes and equity in earnings of unconsolidated affiliates 292 (28) 264 Income tax expense (benefit) 71 (6) 65 Earnings (loss) before equity in earnings of unconsolidated affiliates 221 (22) 199 Equity in earnings of unconsolidated affiliates 7 — 7 Net earnings (loss) $ 228 $ (22) $ 206 Assets $ 8,567 $ 1,080 $ 9,647 Goodwill 2,463 264 2,727 |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | Our revenue consists of: Three months ended March 31, 2020 2019 Revenue Stream Income Statement Classification Segment Total Revenue Revenue from insurance contracts: (in millions) Direct title insurance premiums Direct title insurance premiums Title $ 546 $ 440 Agency title insurance premiums Agency title insurance premiums Title 732 552 Home warranty Escrow, title-related and other fees Title 43 41 Total revenue from insurance contracts 1,321 1,033 Revenue from contracts with customers: Escrow fees Escrow, title-related and other fees Title 221 165 Other title-related fees and income Escrow, title-related and other fees Title 159 136 ServiceLink, excluding title premiums, escrow fees, and subservicing fees Escrow, title-related and other fees Title 106 83 Real estate technology Escrow, title-related and other fees Corporate and other 27 25 Real estate brokerage Escrow, title-related and other fees Corporate and other 6 7 Other Escrow, title-related and other fees Corporate and other (42) 21 Total revenue from contracts with customers 477 437 Other revenue: Loan subservicing revenue Escrow, title-related and other fees Title 81 56 Interest and investment income Interest and investment income Various 53 54 Realized gains and losses, net Realized gains and losses, net Various (320) 142 Total revenues Total revenues $ 1,612 $ 1,722 |
Information about Trade Receivables and Deferred Revenue | The following table provides information about trade receivables and deferred revenue: March 31, 2020 December 31, 2019 (In millions) Trade receivables $ 301 $ 321 Deferred revenue (contract liabilities) 107 111 |
Basis of Financial Statements -
Basis of Financial Statements - Recent Developments (Details) | Apr. 22, 2020USD ($) | Feb. 07, 2020$ / shares |
Subsequent Event | Term Loan | LIBOR | ||
Business Acquisition [Line Items] | ||
Floor interest rate | 0.0075 | |
Subsequent Event | Term Loan | LIBOR | Minimum | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 2.00% | |
Subsequent Event | Term Loan | LIBOR | Maximum | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 0.03% | |
Subsequent Event | Term Loan Credit Agreement | ||
Business Acquisition [Line Items] | ||
Line of credit facility | $ 1,000,000,000 | |
Subsequent Event | Term Loan Credit Agreement | Term Loan | ||
Business Acquisition [Line Items] | ||
Line of credit facility | $ 1,000,000,000 | |
Subsequent Event | Term Loan Credit Agreement | Term Loan | Fed Funds | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 0.50% | |
Subsequent Event | Term Loan Credit Agreement | Term Loan | LIBOR | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 1.00% | |
Floor interest rate | 0.0175 | |
Subsequent Event | Term Loan Credit Agreement | Term Loan | LIBOR | Minimum | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 1.00% | |
Subsequent Event | Term Loan Credit Agreement | Term Loan | LIBOR | Maximum | ||
Business Acquisition [Line Items] | ||
Basis spread on variable rate (as percent) | 2.00% | |
FGL Holdings | ||
Business Acquisition [Line Items] | ||
Consideration, cash paid per acquiree share (in usd per share) | $ / shares | $ 12.50 | |
Stock consideration (in shares) | 0.2558 |
Basis of Financial Statements_2
Basis of Financial Statements - Income Tax (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Income tax (benefit) expense | $ (28) | $ 65 |
Income tax expense as a percentage of earnings before income taxes, percent | 33.00% | 25.00% |
Income tax benefit related to 2017 amended return | $ 7 |
Basis of Financial Statements_3
Basis of Financial Statements - Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Antidilutive instruments (in shares) | 3,000,000 | 0 |
Summary of Reserve for Claim _2
Summary of Reserve for Claim Losses - Summary of Reserve Claims (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Beginning balance | $ 1,509 | $ 1,488 |
Change in reinsurance recoverable | (1) | (1) |
Claim loss provision related to: | ||
Current year | 58 | 45 |
Prior years | 0 | 0 |
Total title claim loss provision | 58 | 45 |
Claims paid, net of recoupments related to: | ||
Current year | 0 | (1) |
Prior years | (48) | (48) |
Total title claims paid, net of recoupments | (48) | (49) |
Ending balance of claim loss reserve for title insurance | $ 1,518 | $ 1,483 |
Provision for title insurance claim losses as a percentage of title insurance premiums | 4.50% | 4.50% |
Summary of Reserve for Claim _3
Summary of Reserve for Claim Losses - Narrative (Details) $ in Millions | Mar. 16, 2020USD ($) | Mar. 06, 2020USD ($) | Dec. 13, 2019USD ($) | Oct. 22, 2019USD ($) | Mar. 31, 2020lawsuit |
Loss Contingencies [Line Items] | |||||
Number of lawsuits | lawsuit | 5 | ||||
Pending Litigation | Ovation Fin. Holdings 2 LLC, Ovation Fund Mgmt. II, LLC, Banc of California, N.A. v. Chicago Title Ins. Co., Chicago Title Co., Case No. 3:19-cv-02031-GPC-KSC | |||||
Loss Contingencies [Line Items] | |||||
Plaintiffs claim losses amount | $ 75 | ||||
Pending Litigation | Kim Funding, LLC, Kim H. Peterson, Joseph J. Cohen, and ABC Funding Strategies, LLC v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, and Betty Elixman | |||||
Loss Contingencies [Line Items] | |||||
Plaintiffs claim losses amount | $ 250 | ||||
Pending Litigation | Wakefield Capital, LLC, Wakefield Investments, LLC, 2Budz Holding, LLC, Doug and Kristine Heidrich, and Jeff and Heidi Orr v. Chicago Title Co. and Chicago Title Ins. Co. | |||||
Loss Contingencies [Line Items] | |||||
Plaintiffs claim losses amount | $ 7.8 | ||||
Pending Litigation | Randolph L. Levin, et al., v. Chicago Title Co., Chicago Title Ins. Co., Thomas Schwiebert, Adelle Ducharme, Betty Elixman, et al | |||||
Loss Contingencies [Line Items] | |||||
Plaintiffs claim losses amount | $ 38 | ||||
Threatened Litigation | |||||
Loss Contingencies [Line Items] | |||||
Plaintiffs claim losses amount | $ 30 |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Hierarchy for Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | $ 2,057 | $ 2,090 |
Total assets | 3,048 | 3,344 |
U.S. government and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 278 | 288 |
State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 92 | 93 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 1,567 | 1,587 |
Mortgage-backed/asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 63 | 62 |
Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 57 | 60 |
Preferred securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 304 | 323 |
Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 628 | 811 |
Other long-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other long-term investments | 59 | 120 |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 827 | 875 |
Level 1 | U.S. government and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 1 | State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 1 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 1 | Mortgage-backed/asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 1 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 1 | Preferred securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 141 | 65 |
Level 1 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 627 | 810 |
Level 1 | Other long-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other long-term investments | 59 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 2,206 | 2,331 |
Level 2 | U.S. government and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 278 | 288 |
Level 2 | State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 92 | 93 |
Level 2 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 1,553 | 1,570 |
Level 2 | Mortgage-backed/asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 63 | 62 |
Level 2 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 57 | 60 |
Level 2 | Preferred securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 163 | 258 |
Level 2 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Other long-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other long-term investments | 0 | 0 |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets | 15 | 138 |
Level 3 | U.S. government and agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 3 | State and political subdivisions | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 3 | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 14 | 17 |
Level 3 | Mortgage-backed/asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 3 | Foreign government bonds | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Available for sale debt securities | 0 | 0 |
Level 3 | Preferred securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Equity securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Equity securities, at fair value | 1 | 1 |
Level 3 | Other long-term investments | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Other long-term investments | $ 0 | $ 120 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Changes in Fair Value of Level 3 Assets Measured on a Recurring Basis (Details) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020USD ($)firm | Mar. 31, 2019USD ($) | Dec. 31, 2019 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Number of firms to value preferred stock and bond portfolios | firm | 1 | ||
Number of firms utilized to value Level 3 other-long term investments | firm | 1 | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers out of Level 3 | $ (59) | $ (4) | |
Other Long-Term Investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers out of Level 3 | (59) | 0 | |
Equity securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers out of Level 3 | 0 | ||
Paid-in-kind dividends | 0 | ||
Purchases | 0 | ||
Sales and maturities | 0 | ||
Net valuation (loss) gain included in earnings | 0 | ||
Corporate Debt Securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Transfers out of Level 3 | 0 | (4) | |
Level 3 | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, Beginning of period | 138 | 118 | |
Paid-in-kind dividends | 2 | 2 | |
Purchases | 0 | 5 | |
Sales and maturities | 0 | (1) | |
Net valuation (loss) gain included in earnings | (66) | 5 | |
Fair value, End of period | 15 | 125 | |
Level 3 | Other Long-Term Investments | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, Beginning of period | 120 | 101 | |
Paid-in-kind dividends | 2 | 1 | |
Purchases | 0 | 0 | |
Sales and maturities | 0 | 0 | |
Net valuation (loss) gain included in earnings | (63) | 5 | |
Fair value, End of period | 0 | 107 | |
Level 3 | Equity securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, Beginning of period | 1 | ||
Fair value, End of period | 1 | ||
Level 3 | Corporate Debt Securities | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Fair value, Beginning of period | 17 | 17 | |
Paid-in-kind dividends | 0 | 1 | |
Purchases | 0 | 5 | |
Sales and maturities | 0 | (1) | |
Net valuation (loss) gain included in earnings | (3) | 0 | |
Fair value, End of period | $ 14 | $ 18 | |
Level 3 | Measurement Input, Discount Rate | Minimum | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value, discount rate | 0.068 | ||
Level 3 | Measurement Input, Discount Rate | Maximum | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value, discount rate | 0.074 | ||
Level 3 | Measurement Input, Discount Rate | Weighted Average | |||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | |||
Fair value, discount rate | 0.070 |
Investments - Schedule of Carry
Investments - Schedule of Carrying Amount and Fair Value of Available for Sale Securities (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Fixed maturity securities available for sale: | ||
Carrying Value | $ 2,057,000,000 | $ 2,090,000,000 |
Cost Basis | 2,025,000,000 | 2,029,000,000 |
Unrealized Gains | 60,000,000 | 67,000,000 |
Unrealized Losses | (17,000,000) | (6,000,000) |
Allowance for Credit Loss | (11,000,000) | 0 |
U.S. government and agencies | ||
Fixed maturity securities available for sale: | ||
Carrying Value | 278,000,000 | 288,000,000 |
Cost Basis | 265,000,000 | 282,000,000 |
Unrealized Gains | 13,000,000 | 7,000,000 |
Unrealized Losses | 0 | (1,000,000) |
Allowance for Credit Loss | 0 | |
State and political subdivisions | ||
Fixed maturity securities available for sale: | ||
Carrying Value | 92,000,000 | 93,000,000 |
Cost Basis | 90,000,000 | 90,000,000 |
Unrealized Gains | 2,000,000 | 3,000,000 |
Unrealized Losses | 0 | 0 |
Allowance for Credit Loss | 0 | |
Corporate debt securities | ||
Fixed maturity securities available for sale: | ||
Carrying Value | 1,567,000,000 | 1,587,000,000 |
Cost Basis | 1,547,000,000 | 1,536,000,000 |
Unrealized Gains | 42,000,000 | 54,000,000 |
Unrealized Losses | (11,000,000) | (3,000,000) |
Allowance for Credit Loss | (11,000,000) | |
Mortgage-backed/asset-backed securities | ||
Fixed maturity securities available for sale: | ||
Carrying Value | 63,000,000 | 62,000,000 |
Cost Basis | 60,000,000 | 60,000,000 |
Unrealized Gains | 3,000,000 | 2,000,000 |
Unrealized Losses | 0 | 0 |
Allowance for Credit Loss | 0 | |
Foreign government bonds | ||
Fixed maturity securities available for sale: | ||
Carrying Value | 57,000,000 | 60,000,000 |
Cost Basis | 63,000,000 | 61,000,000 |
Unrealized Gains | 0 | 1,000,000 |
Unrealized Losses | (6,000,000) | $ (2,000,000) |
Allowance for Credit Loss | $ 0 |
Investments - Maturity of Fixed
Investments - Maturity of Fixed Maturity Securities (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Amortized Cost | ||
One year or less | $ 319 | |
After one year through five years | 1,104 | |
After five years through ten years | 421 | |
After ten years | 121 | |
Mortgage-backed/asset-backed securities | 60 | |
Cost Basis | $ 2,025 | $ 2,029 |
Amortized Cost, % of Total | ||
One year or less | 16.00% | |
After one year through five years | 54.00% | |
After five years through ten years | 21.00% | |
After ten years | 6.00% | |
Mortgage-backed/asset-backed securities | 3.00% | |
Total | 100.00% | |
Fair Value | ||
One year or less | $ 315 | |
After one year through five years | 1,112 | |
After five years through ten years | 442 | |
After ten years | 125 | |
Mortgage-backed/asset-backed securities | 63 | |
Total | $ 2,057 | $ 2,090 |
Fair Value, % of Total | ||
One year or less | 15.00% | |
After one year through five years | 55.00% | |
After five years through ten years | 21.00% | |
After ten years | 6.00% | |
Mortgage-backed/asset-backed securities | 3.00% | |
Total | 100.00% |
Investments - Securities in a C
Investments - Securities in a Continuous Unrealized Loss Position With No Allowance for Credit Losses (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value | ||
Less than 12 Months | $ 440 | $ 160 |
12 Months or Longer | 65 | 84 |
Fair Value, Total | 505 | 244 |
Unrealized Losses | ||
Less than 12 Months | (11) | (3) |
12 Months or Longer | (6) | (3) |
Unrealized Loss, Total | (17) | (6) |
U.S. government and agencies | ||
Fair Value | ||
Less than 12 Months | 62 | |
12 Months or Longer | 0 | |
Fair Value, Total | 62 | |
Unrealized Losses | ||
Less than 12 Months | (1) | |
12 Months or Longer | 0 | |
Unrealized Loss, Total | (1) | |
Corporate debt securities | ||
Fair Value | ||
Less than 12 Months | 98 | |
12 Months or Longer | 51 | |
Fair Value, Total | 149 | |
Unrealized Losses | ||
Less than 12 Months | (2) | |
12 Months or Longer | (1) | |
Unrealized Loss, Total | (3) | |
Corporate debt securities | No Allowance For Credit Losses | ||
Fair Value | ||
Less than 12 Months | 404 | |
12 Months or Longer | 45 | |
Fair Value, Total | 449 | |
Unrealized Losses | ||
Less than 12 Months | (9) | |
12 Months or Longer | (2) | |
Unrealized Loss, Total | (11) | |
Foreign government bonds | ||
Fair Value | ||
Less than 12 Months | 0 | |
12 Months or Longer | 33 | |
Fair Value, Total | 33 | |
Unrealized Losses | ||
Less than 12 Months | 0 | |
12 Months or Longer | (2) | |
Unrealized Loss, Total | $ (2) | |
Foreign government bonds | No Allowance For Credit Losses | ||
Fair Value | ||
Less than 12 Months | 36 | |
12 Months or Longer | 20 | |
Fair Value, Total | 56 | |
Unrealized Losses | ||
Less than 12 Months | (2) | |
12 Months or Longer | (4) | |
Unrealized Loss, Total | $ (6) |
Investments - Securities in a_2
Investments - Securities in a Continuous Unrealized Loss Position (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value | ||
Less than 12 Months | $ 440 | $ 160 |
12 Months or Longer | 65 | 84 |
Fair Value, Total | 505 | 244 |
Unrealized Losses | ||
Less than 12 Months | (11) | (3) |
12 Months or Longer | (6) | (3) |
Unrealized Loss, Total | $ (17) | (6) |
U.S. government and agencies | ||
Fair Value | ||
Less than 12 Months | 62 | |
12 Months or Longer | 0 | |
Fair Value, Total | 62 | |
Unrealized Losses | ||
Less than 12 Months | (1) | |
12 Months or Longer | 0 | |
Unrealized Loss, Total | (1) | |
Corporate debt securities | ||
Fair Value | ||
Less than 12 Months | 98 | |
12 Months or Longer | 51 | |
Fair Value, Total | 149 | |
Unrealized Losses | ||
Less than 12 Months | (2) | |
12 Months or Longer | (1) | |
Unrealized Loss, Total | (3) | |
Foreign government bonds | ||
Fair Value | ||
Less than 12 Months | 0 | |
12 Months or Longer | 33 | |
Fair Value, Total | 33 | |
Unrealized Losses | ||
Less than 12 Months | 0 | |
12 Months or Longer | (2) | |
Unrealized Loss, Total | $ (2) |
Investments - Narrative (Detail
Investments - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Investments, Debt and Equity Securities [Abstract] | ||
Impairment charges related to debt securities | $ 11 | $ 0 |
Investments - Realized Gains an
Investments - Realized Gains and Losses and Proceeds on Investments and Other Assets (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Valuation of fixed maturity securities available for sale | |||
Allowance for Credit Loss | $ (11,000,000) | $ 0 | |
Impairment of lease assets | |||
Net Realized Gains (Losses) | $ (4,000,000) | ||
Gross Proceeds from Sale/Maturity | 0 | ||
Other realized gains and losses, net | |||
Net Realized Gains (Losses) | (10,000,000) | ||
Gross Proceeds from Sale/Maturity | 9,000,000 | ||
Total | |||
Net Realized Gains (Losses) | (320,000,000) | 142,000,000 | |
Gross Proceeds from Sale/Maturity | 269,000,000 | 300,000,000 | |
Sales and maturities of fixed maturity securities available for sale | |||
Sales and maturities of fixed maturity securities available for sale | |||
Gross Realized Gains | 12,000,000 | 1,000,000 | |
Gross Realized Losses | (1,000,000) | (1,000,000) | |
Net Realized Gains (Losses) | 11,000,000 | 0 | |
Gross Proceeds from Sale/Maturity | 177,000,000 | 235,000,000 | |
Preferred securities | |||
Equity Securities, FV-NI, Realized Gain (Loss) [Abstract] | |||
Gross Realized Gains | 0 | 0 | |
Gross Realized Losses | 0 | 0 | |
Net Realized Gains (Losses) | 0 | 0 | |
Gross Proceeds from Sale/Maturity | 83,000,000 | 24,000,000 | |
Valuation Of Equity And Preferred Securities | |||
Net Realized Gains (Losses) | (42,000,000) | 11,000,000 | |
Equity securities | |||
Equity Securities, FV-NI, Realized Gain (Loss) [Abstract] | |||
Gross Realized Gains | 0 | 4,000,000 | |
Gross Realized Losses | 0 | 0 | |
Net Realized Gains (Losses) | 0 | 4,000,000 | |
Gross Proceeds from Sale/Maturity | 0 | 41,000,000 | |
Valuation Of Equity And Preferred Securities | |||
Net Realized Gains (Losses) | (205,000,000) | 126,000,000 | |
Other long-term investments | |||
Valuation of other long term investments | |||
Net Realized Gains (Losses) | $ (63,000,000) | $ 5,000,000 |
Investments - Investments with
Investments - Investments with Related Party (Details) - Cannae - Common Stock - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 |
Related Party Transaction [Line Items] | ||
Included in equity securities shares of related party (in shares) | 5,706,134 | 5,706,134 |
Fair value of shares owned of related party | $ 191 | $ 212 |
Notes Payable - Schedule of Lon
Notes Payable - Schedule of Long Term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Dec. 31, 2019 | May 16, 2019 | Aug. 13, 2018 | Aug. 28, 2012 |
Debt Instrument [Line Items] | |||||
Notes payable | $ 839 | $ 838 | |||
Unsecured notes | 4.50% Notes, net of discount | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 4.50% | 4.50% | 4.50% | ||
Notes payable | $ 443 | 443 | |||
Unsecured notes | 5.50% Notes, net of discount | |||||
Debt Instrument [Line Items] | |||||
Stated interest rate | 5.50% | 5.50% | |||
Notes payable | $ 398 | 398 | |||
Line of Credit | Revolving Credit Facility | Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Notes payable | 2 | $ 3 | |||
Unamortized debt issuance costs | $ 2 |
Notes Payable - Long Term Debt
Notes Payable - Long Term Debt Narrative (Details) $ in Millions | Mar. 31, 2020USD ($) |
Debt Instrument [Line Items] | |
Excess fair value over carrying value of long-term debt | $ 104 |
Debt issuance costs, net | 12 |
Unsecured notes | Level 2 | |
Debt Instrument [Line Items] | |
Fair value of long term debt | $ 955 |
Notes Payable - 4.50% Notes (De
Notes Payable - 4.50% Notes (Details) - Unsecured notes - 4.50 % Notes Due August 2028 - USD ($) | Mar. 31, 2020 | May 16, 2019 | Aug. 13, 2018 |
Debt Instrument [Line Items] | |||
Amount of debt instrument | $ 450,000,000 | ||
Stated interest rate | 4.50% | 4.50% | 4.50% |
Price as percent of par on offering of unsecured Notes | 99.252% | ||
Annual interest rate | 4.594% |
Notes Payable - Existing Credit
Notes Payable - Existing Credit Agreement (Details) - USD ($) | Mar. 31, 2020 | Jun. 25, 2013 |
Debt Instrument [Line Items] | ||
Outstanding principal | $ 850,000,000 | |
Revolving Credit Facility | Line of Credit | Revolving Credit Facility Due April 2022 | ||
Debt Instrument [Line Items] | ||
Line of credit facility | $ 800,000,000 | |
Outstanding principal | 0 | |
Unamortized debt issuance costs | 2,000,000 | |
Remaining borrowing capacity | $ 800,000,000 |
Notes Payable - 5.50% Notes (De
Notes Payable - 5.50% Notes (Details) - Unsecured notes - 5.50% notes due September 2022 - USD ($) | Mar. 31, 2020 | Aug. 28, 2012 |
Debt Instrument [Line Items] | ||
Aggregate principal amount | $ 400,000,000 | |
Stated interest rate | 5.50% | 5.50% |
Notes Payable - Principal Matur
Notes Payable - Principal Maturities of Notes Payable (Details) $ in Millions | Mar. 31, 2020USD ($) |
Maturities of Long-term Debt [Abstract] | |
2020 (remaining) | $ 0 |
2021 | 0 |
2022 | 400 |
2023 | 0 |
2024 | 0 |
Thereafter | 450 |
Total Long Term Debt | $ 850 |
Commitments and Contingencies -
Commitments and Contingencies - Narrative (Details) $ in Millions | Mar. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Accrual for legal and regulatory matters | $ 22 |
Dividends (Details)
Dividends (Details) - $ / shares | Apr. 23, 2020 | Mar. 31, 2020 | Mar. 31, 2019 |
Subsequent Event [Line Items] | |||
Cash dividends declared (in usd per share) | $ 0.33 | $ 0.31 | |
FNF Common Stock | Subsequent Event | |||
Subsequent Event [Line Items] | |||
Cash dividends declared (in usd per share) | $ 0.33 |
Segment Information - Schedule
Segment Information - Schedule of Segment Reporting Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Segment Reporting Information [Line Items] | |||
Title premiums | $ 1,278 | $ 992 | |
Other revenues | 601 | 534 | |
Revenues from external customers | 1,879 | 1,526 | |
Interest and investment income, including realized gains and losses | (267) | 196 | |
Total revenues | 1,612 | 1,722 | |
Depreciation and amortization | 43 | 44 | |
Interest expense | 12 | 12 | |
Loss before income taxes and equity in earnings of unconsolidated affiliates | (86) | 264 | |
Income tax benefit | (28) | 65 | |
(Loss) earnings before equity in earnings of unconsolidated affiliates | (58) | 199 | |
Equity in earnings of unconsolidated affiliates | 1 | 7 | |
Net (loss) earnings | (57) | 206 | |
Assets | 10,204 | 9,647 | $ 10,677 |
Goodwill | 2,726 | 2,727 | $ 2,727 |
Corporate and Other | |||
Segment Reporting Information [Line Items] | |||
Title premiums | 0 | 0 | |
Other revenues | (9) | 53 | |
Revenues from external customers | (9) | 53 | |
Interest and investment income, including realized gains and losses | (2) | 6 | |
Total revenues | (11) | 59 | |
Depreciation and amortization | 6 | 5 | |
Interest expense | 12 | 12 | |
Loss before income taxes and equity in earnings of unconsolidated affiliates | (33) | (28) | |
Income tax benefit | (9) | (6) | |
(Loss) earnings before equity in earnings of unconsolidated affiliates | (24) | (22) | |
Equity in earnings of unconsolidated affiliates | 0 | 0 | |
Net (loss) earnings | (24) | (22) | |
Assets | 1,476 | 1,080 | |
Goodwill | 266 | 264 | |
Operating Segments | Title | |||
Segment Reporting Information [Line Items] | |||
Title premiums | 1,278 | 992 | |
Other revenues | 610 | 481 | |
Revenues from external customers | 1,888 | 1,473 | |
Interest and investment income, including realized gains and losses | (265) | 190 | |
Total revenues | 1,623 | 1,663 | |
Depreciation and amortization | 37 | 39 | |
Interest expense | 0 | 0 | |
Loss before income taxes and equity in earnings of unconsolidated affiliates | (53) | 292 | |
Income tax benefit | (19) | 71 | |
(Loss) earnings before equity in earnings of unconsolidated affiliates | (34) | 221 | |
Equity in earnings of unconsolidated affiliates | 1 | 7 | |
Net (loss) earnings | (33) | 228 | |
Assets | 8,728 | 8,567 | |
Goodwill | $ 2,460 | $ 2,463 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ 477 | $ 437 |
Interest and investment income | 53 | 54 |
Realized gains and losses, net | (320) | 142 |
Total revenues | 1,612 | 1,722 |
Title | ||
Disaggregation of Revenue [Line Items] | ||
Loan subservicing revenue | 81 | 56 |
Title | Direct title insurance premiums | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 546 | 440 |
Title | Agency title insurance premiums | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 732 | 552 |
Title | Home warranty | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 43 | 41 |
Title | Insurance contracts | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 1,321 | 1,033 |
Title | Escrow fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 221 | 165 |
Title | Other title-related fees and income | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 159 | 136 |
Title | ServiceLink, excluding title premiums, escrow fees, and subservicing fees | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 106 | 83 |
Corporate and other | ||
Disaggregation of Revenue [Line Items] | ||
Total revenues | (11) | 59 |
Corporate and other | Real estate technology | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 27 | 25 |
Corporate and other | Real estate brokerage | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | 6 | 7 |
Corporate and other | Other | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer | $ (42) | $ 21 |
Revenue Recognition - Informati
Revenue Recognition - Information about Receivables and Deferred Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | ||
Trade receivables | $ 301 | $ 321 |
Deferred revenue (contract liabilities) | $ 107 | $ 111 |
Policy period | 1 year | |
Revenue recognized | $ 44 |