Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Feb. 02, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | MERCURY GENERAL CORP | ||
Entity Central Index Key | 64,996 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 55,164,462 | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 1,508,221,904 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Investments, at fair value: | ||
Fixed maturity securities (amortized cost $2,804,275; $2,503,494) | $ 2,880,003 | $ 2,618,400 |
Equity securities (cost $313,528; $387,851) | 315,362 | 412,880 |
Short-term investments (cost $185,353; $373,180) | 185,277 | 372,542 |
Total investments | 3,380,642 | 3,403,822 |
Cash | 264,221 | 289,907 |
Receivables: | ||
Premiums | 436,621 | 390,009 |
Accrued investment income | 42,747 | 38,737 |
Other | 21,925 | 21,202 |
Total receivables | 501,293 | 449,948 |
Deferred policy acquisition costs | 201,762 | 197,202 |
Fixed assets, net | 157,131 | 158,976 |
Current income taxes | 9,041 | 503 |
Deferred income taxes | 23,231 | 0 |
Goodwill | 42,796 | 42,796 |
Other intangible assets, net | 31,702 | 35,623 |
Other assets | 16,826 | 21,512 |
Total assets | 4,628,645 | 4,600,289 |
Liabilities | ||
Losses and loss adjustment expenses | 1,146,688 | 1,091,797 |
Unearned premiums | 1,049,314 | 999,798 |
Notes payable | 290,000 | 290,000 |
Accounts payable and accrued expenses | 122,571 | 130,887 |
Deferred income taxes | 0 | 5,333 |
Other liabilities | 199,187 | 207,028 |
Total liabilities | $ 2,807,760 | $ 2,724,843 |
Commitments and contingencies | ||
Shareholders’ equity: | ||
Common stock without par value or stated value: Authorized 70,000 shares; issued and outstanding 55,164; 55,121 | $ 90,985 | $ 88,705 |
Additional paid-in capital | 8,870 | 3,804 |
Retained earnings | 1,721,030 | 1,782,937 |
Total shareholders’ equity | 1,820,885 | 1,875,446 |
Total liabilities and shareholders’ equity | $ 4,628,645 | $ 4,600,289 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Statement of Financial Position [Abstract] | ||
Amortized cost on fixed maturities trading investments | $ 2,804,275 | $ 2,503,494 |
Cost - equity security trading investments | 313,528 | 387,851 |
Cost - short-term investments | $ 185,353 | $ 373,180 |
Common Stock | ||
Common stock, no par value (in dollars per share) | $ 0 | $ 0 |
Common stock, shares authorized (in shares) | 70,000,000 | 70,000,000 |
Common stock, shares issued (in shares) | 55,164,000 | 55,121,000 |
Common stock, shares outstanding (in shares) | 55,164,000 | 55,121,000 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||
Net premiums earned | $ 2,957,897 | $ 2,796,195 | $ 2,698,187 |
Net investment income | 126,299 | 125,723 | 124,538 |
Net realized investment (losses) gains | (83,807) | 81,184 | (11,422) |
Other | 8,911 | 8,671 | 9,738 |
Total revenues | 3,009,300 | 3,011,773 | 2,821,041 |
Expenses: | |||
Losses and loss adjustment expenses | 2,145,495 | 1,986,122 | 1,962,690 |
Policy acquisition costs | 539,231 | 526,208 | 505,517 |
Other operating expenses | 250,839 | 249,381 | 219,478 |
Interest | 3,168 | 2,637 | 1,260 |
Total expenses | 2,938,733 | 2,764,348 | 2,688,945 |
Income before income taxes | 70,567 | 247,425 | 132,096 |
Income tax (benefit) expense | (3,912) | 69,476 | 19,953 |
Net income | $ 74,479 | $ 177,949 | $ 112,143 |
Net income per share: | |||
Basic (in dollars per share) | $ 1.35 | $ 3.23 | $ 2.04 |
Diluted (in dollars per share) | $ 1.35 | $ 3.23 | $ 2.04 |
Consolidated Statements Of Shar
Consolidated Statements Of Shareholders' Equity - USD ($) $ in Thousands | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] |
Beginning of year at Dec. 31, 2012 | $ 79,380 | $ 0 | $ 1,763,117 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 1,884 | (438) | ||
Share-based compensation expense | 125 | 849 | ||
Tax benefit on sales of incentive stock options | $ 202 | 202 | ||
Net income | 112,143 | 112,143 | ||
Dividends paid to shareholders | (134,776) | |||
End of year at Dec. 31, 2013 | 1,822,486 | 81,591 | 411 | 1,740,484 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 6,824 | (577) | ||
Share-based compensation expense | 142 | 3,970 | ||
Tax benefit on sales of incentive stock options | 148 | 148 | ||
Net income | 177,949 | 177,949 | ||
Dividends paid to shareholders | (135,496) | |||
End of year at Dec. 31, 2014 | 1,875,446 | 88,705 | 3,804 | 1,782,937 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Exercise of stock options | 2,111 | 0 | ||
Share-based compensation expense | 142 | 5,066 | ||
Tax benefit on sales of incentive stock options | 27 | 27 | ||
Net income | 74,479 | 74,479 | ||
Dividends paid to shareholders | (136,386) | |||
End of year at Dec. 31, 2015 | $ 1,820,885 | $ 90,985 | $ 8,870 | $ 1,721,030 |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | $ 74,479 | $ 177,949 | $ 112,143 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 26,478 | 28,054 | 30,587 |
Net realized investment losses (gains) | 83,807 | (81,184) | 11,422 |
Bond amortization, net | 21,360 | 18,918 | 12,529 |
Excess tax benefit from exercise of stock options | (27) | (148) | (202) |
Increase in premiums receivable | (41,512) | (23,934) | (20,688) |
Changes in current and deferred income taxes | (35,287) | 8,343 | 3,451 |
Increase in deferred policy acquisition costs | (4,560) | (2,736) | (8,556) |
Increase in unpaid losses and loss adjustment expenses | (36,214) | (52,813) | (2,861) |
Increase in unearned premiums | 42,552 | 46,271 | 33,098 |
(Decrease) increase in accounts payable and accrued expenses | (35,086) | 31,019 | 30,367 |
Share-based compensation | (5,208) | (4,112) | (974) |
Increase (decrease) in other payables | 18,114 | (10,988) | 12,135 |
Other, net | (1,496) | (1,954) | (10,317) |
Net cash provided by operating activities | 190,244 | 246,535 | 209,804 |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Fixed maturity securities available-for-sale in nature: Purchases | (965,701) | (542,494) | (831,796) |
Fixed maturity securities available-for-sale in nature: Sales | 260,946 | 209,680 | 228,116 |
Fixed maturity securities available-for-sale in nature: Calls or maturities | 386,644 | 330,637 | 343,628 |
Equity securities available for sale in nature: | |||
Purchases | (748,217) | (868,383) | (596,883) |
Sales | 805,417 | 745,058 | 872,997 |
Calls | 2,851 | 1,044 | 0 |
Changes in securities payable and receivable | (1,387) | 9,294 | 1,702 |
Net decrease (increase) in short-term investments and purchased options | 187,492 | (56,530) | (20,005) |
Purchase of fixed assets | (20,112) | (26,037) | (18,671) |
Sale of fixed assets | 141 | 224 | 820 |
Business acquisition, net of cash acquired | 7,771 | 0 | 0 |
Other, net | 2,473 | 3,472 | 1,741 |
Net cash used in investing activities | (81,682) | (194,035) | (18,351) |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Dividends paid to shareholders | (136,386) | (135,496) | (134,776) |
Excess tax benefit from exercise of stock options | 27 | 148 | 202 |
Proceeds from stock options exercised | 2,111 | 6,247 | 1,446 |
Proceeds from bank loan | 0 | 100,000 | 50,000 |
Net cash used in financing activities | (134,248) | (29,101) | (83,128) |
Net (decrease) increase in cash | (25,686) | 23,399 | 108,325 |
Cash: | |||
Beginning of year | 289,907 | 266,508 | 158,183 |
End of year | 264,221 | 289,907 | 266,508 |
SUPPLEMENTAL CASH FLOW DISCLOSURE | |||
Interest paid | 2,989 | 2,543 | 998 |
Income taxes paid | $ 31,390 | $ 61,139 | $ 16,503 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies General Mercury General Corporation ("Mercury General") and its subsidiaries (referred to herein collectively as the "Company") are primarily engaged in writing personal automobile insurance through 14 Insurance Companies in 13 states, principally California. The Company also writes homeowners, commercial automobile, commercial property, mechanical breakdown, fire, and umbrella insurance. The private passenger automobile line of insurance business was more than 77% of the Company’s direct premiums written in 2015 , 2014 , and 2013 , of which approximately 83% , 83% , and 81% of the private passenger automobile premiums were written in California during 2015 , 2014 , and 2013 , respectively. Premiums written represents the premiums charged on policies issued during a fiscal period, which is a statutory measure designed to determine production levels. Consolidation and Basis of Presentation The consolidated financial statements include the accounts of Mercury General Corporation and its subsidiaries: Insurance Companies Mercury Casualty Company ("MCC") Mercury National Insurance Company Mercury Insurance Company ("MIC") American Mercury Insurance Company California Automobile Insurance Company ("CAIC") American Mercury Lloyds Insurance Company (1) California General Underwriters Insurance Company, Inc. Mercury County Mutual Insurance Company (2) Mercury Insurance Company of Illinois Mercury Insurance Company of Florida Mercury Insurance Company of Georgia Mercury Indemnity Company of America Mercury Indemnity Company of Georgia Workmen's Auto Insurance Company ("WAIC") (5) Non-Insurance Companies Mercury Select Management Company, Inc. AIS Management LLC Mercury Insurance Services LLC Auto Insurance Specialists LLC Animas Funding LLC ("AFL") (3) PoliSeek AIS Insurance Solutions, Inc. Fannette Funding LLC ("FFL") (4) __________ (1) American Mercury Lloyds Insurance Company is not owned but is controlled by the Company through its attorney-in-fact, Mercury Select Management Company, Inc. (2) Mercury County Mutual Insurance Company is not owned but is controlled by the Company through a management contract. (3) Special purpose investment vehicle formed in 2013. (4) Special purpose investment vehicle formed in 2014. (5) California domiciled insurance company acquired in 2015. See Note 20. Acquisition. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP"), which differ in some respects from those filed in reports to insurance regulatory authorities. All intercompany transactions and balances have been eliminated. Certain reclassifications have been made in the 2014 consolidated financial statements to conform to the classifications in 2015. The Company did not have other comprehensive income (loss) in 2015 , 2014 and 2013 . Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates require the Company to apply complex assumptions and judgments, and often the Company must make estimates about effects of matters that are inherently uncertain and will likely change in subsequent periods. The most significant assumptions in the preparation of these consolidated financial statements relate to reserves for losses and loss adjustment expenses. Actual results could differ from those estimates. Investments The Company applies the fair value option to all fixed maturity and equity securities and short-term investments at the time an eligible items is first recognized. The primary reasons for electing the fair value option were simplification and cost benefit considerations as well as the expansion of the use of fair value measurement by the Company consistent with the long-term measurement objectives of the Financial Accounting Standards Board (the "FASB") for accounting for financial instruments. See Note 2. Fair Value of Financial Instruments for additional information on the fair value option. Gains and losses due to changes in fair value for items measured at fair value pursuant to application of the fair value option are included in net realized investment (losses) gains in the Company's consolidated statements of operations, while interest and dividend income on investment holdings are recognized on an accrual basis on each measurement date and are included in net investment income in the Company's consolidated statements of operations. Fixed maturity securities include debt securities, which may have fixed or variable principal payment schedules, may be held for indefinite periods of time, and may be used as a part of the Company’s asset/liability strategy or sold in response to changes in interest rates, anticipated prepayments, risk/reward characteristics, liquidity needs, tax planning considerations, or other economic factors. Premiums and discounts on fixed maturities are amortized using first call date and are adjusted for anticipated prepayments. Premiums and discounts on mortgage-backed securities are adjusted for anticipated prepayment using the retrospective method, with the exception of some beneficial interests in securitized financial assets, which are accounted for using the prospective method. Equity securities consist of non-redeemable preferred stocks, common stocks on which dividend income is partially tax-sheltered by the 70% corporate dividend received deduction, and an interest in private equity funds. Short-term investments include money market accounts, options, and short-term bonds that are highly rated short duration securities and redeemable within one year. Securities on Deposit As required by statute, the Company’s insurance subsidiaries have securities deposited with the Departments of Insurance or similar governmental agencies in the states in which they are licensed to operate with fair values totaling $21 million and $18 million at December 31, 2015 and 2014 , respectively. Deferred Policy Acquisition Costs Deferred policy acquisition costs consist of commissions paid to outside agents, premium taxes, salaries, and certain other underwriting costs that are incremental or directly related to the successful acquisition of new and renewal insurance contracts and are amortized over the life of the related policy in proportion to premiums earned. Deferred policy acquisition costs are limited to the amount that will remain after deducting from unearned premiums and anticipated investment income, the estimated losses and loss adjustment expenses, and the servicing costs that will be incurred as premiums are earned. The Company’s deferred policy acquisition costs are further limited by excluding those costs not directly related to the successful acquisition of insurance contracts. Deferred policy acquisition cost amortization was $539.2 million , $526.2 million , and $505.5 million during the years ended December 31, 2015 , 2014 , and 2013 , respectively. The Company does not defer advertising expenditures but expenses them as incurred. The Company recorded net advertising expense of approximately $44 million , $23 million , and $20 million during the years ended December 31, 2015 , 2014 , and 2013 , respectively. Fixed Assets Fixed assets are stated at historical cost less accumulated depreciation and amortization. The useful life for buildings is 30 to 40 years . Furniture, equipment, and purchased software are depreciated on a combination of straight-line and accelerated methods over 3 to 7 years . The Company has capitalized certain consulting costs, payroll, and payroll-related costs for employees related to computer software developed for internal use, which are amortized on a straight-line method over the estimated useful life of the software, generally not exceeding 7 years . In accordance with applicable accounting standards, capitalization ceases no later than the point at which a computer software project is substantially complete and ready for its intended use. Leasehold improvements are amortized over the shorter of the useful life of the assets or the life of the associated lease. The Company periodically assesses long-lived assets or asset groups including building and equipment, for recoverability when events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the Company identifies an indicator of impairment, the Company assesses recoverability by comparing the carrying amount of the asset to the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset. An impairment loss is recognized when the carrying amount is not recoverable and is measured as the excess of carrying value over fair value. There were no impairment charges during 2015 , 2014 , and 2013 . Goodwill and Other Intangible Assets Goodwill and other intangible assets arise as a result of business acquisitions and consist of the excess of the cost of the acquisitions over the tangible and intangible assets acquired and liabilities assumed and identifiable intangible assets acquired. Identifiable intangible assets consist of the value of customer relationships, trade names, software and technology, and favorable leases, which are all subject to amortization, and an insurance license which is not subject to amortization. The Company evaluates goodwill and other intangible assets for impairment annually or whenever events or changes in circumstances indicate that it is more likely than not that the carrying amount of goodwill and other intangible assets may exceed their implied fair values. The Company qualitatively determines whether, more likely than not, the fair value exceeds the carrying amount of a reporting unit. There are numerous assumptions and estimates underlying the qualitative assessments including future earnings, long-term strategies, and the Company’s annual planning and forecasting process. If these planned initiatives do not accomplish the targeted objectives, the assumptions and estimates underlying the qualitative assessments could be adversely affected and have a material effect upon the Company’s financial condition and results of operations. In addition, the Company evaluates other intangible assets using methods similar to those used for goodwill described above. As of December 31, 2015 and 2014 , goodwill and other intangible impairment assessments indicated that there was no impairment. Premium Revenue Recognition Premium revenue is recognized on a pro-rata basis over the terms of the policies in proportion to the amount of insurance protection provided. Premium revenue includes installment and other fees for services which are recognized in the periods in which the services are rendered. Unearned premiums represent the portion of the written premium related to the unexpired policy term. Unearned premiums are predominantly computed monthly on a pro-rata basis and are stated gross of reinsurance deductions, with the reinsurance deduction recorded in other receivables. Net premiums written, a statutory measure designed to determine production levels, were $3.00 billion , $2.84 billion , and $2.73 billion in 2015 , 2014 , and 2013 , respectively. Losses and Loss Adjustment Expenses Unpaid losses and loss adjustment expenses are determined in amounts estimated to cover incurred losses and loss adjustment expenses and established based upon the Company’s assessment of claims pending and the development of prior years’ loss liabilities. These amounts include liabilities based upon individual case estimates for reported losses and loss adjustment expenses and estimates of such amounts that are incurred but not reported. Changes in the estimated liability are charged or credited to operations as the losses and loss adjustment expenses are re-estimated. The liability is stated net of anticipated salvage and subrogation recoveries. The amount of reinsurance recoverable is included in other receivables. Estimating loss reserves is a difficult process as many factors can ultimately affect the final settlement of a claim and, therefore, the loss reserve that is required. A key assumption in estimating loss reserves is the degree to which the historical data used to analyze reserves will be predictive of ultimate claim costs on incurred claims. Changes in the regulatory and legal environments, results of litigation, medical costs, the cost of repair materials, and labor rates, among other factors, can impact this assumption. In addition, time can be a critical part of reserving determinations since the longer the span between the incidence of a loss and the payment or settlement of a claim, the more variable the ultimate settlement amount could be. Accordingly, short-tail claims, such as property damage claims, tend to be more reasonably predictable than long-tail liability claims, such as those involving the Company’s bodily injury (BI) coverages. Management believes that the liability for losses and loss adjustment expenses is adequate to cover the ultimate net cost of losses and loss adjustment expenses incurred to date. However, since the provisions for loss reserves are necessarily based upon estimates, the ultimate liability may be more or less than such provisions. The Company analyzes loss reserves quarterly primarily using the incurred loss, paid loss, claim count development, and average severity methods described below. When deciding among methods to use, the Company evaluates the credibility of each method based on the maturity of the data available and the claims settlement practices for each particular line of insurance business or coverage within a line of insurance business. The Company may also evaluate qualitative factors such as known changes in laws or legal ruling that could affect claims handling or other external environmental factors or internal factors that could affect the settlement of claims. When establishing the loss reserve, the Company will generally analyze the results from all of the methods used rather than relying on a single method. While these methods are designed to determine the ultimate losses on claims under the Company’s policies, there is inherent uncertainty in all actuarial models since they use historical data to project outcomes. The Company believes that the techniques it uses provide a reasonable basis in estimating loss reserves. • The incurred loss development method analyzes historical incurred case loss (case reserves plus paid losses) development to estimate ultimate losses. The Company applies development factors against current case incurred losses by accident period to calculate ultimate expected losses. The Company believes that the incurred loss development method provides a reasonable basis for evaluating ultimate losses, particularly in the Company’s larger, more established lines of insurance business which have a long operating history. • The average severity method analyzes historical loss payments and/or incurred losses divided by closed claims and/or total claims to calculate an estimated average cost per claim. From this, the expected ultimate average cost per claim can be estimated. The average severity method coupled with the claim count development method provide meaningful information regarding inflation and frequency trends that the Company believes is useful in establishing loss reserves. The claim count development method analyzes historical claim count development to estimate future incurred claim count development for current claims. The Company applies these development factors against current claim counts by accident period to calculate ultimate expected claim counts. • The paid loss development method analyzes historical payment patterns to estimate the amount of losses yet to be paid. The Company uses this method for losses and loss adjustment expenses. The Company analyzes catastrophe losses separately from non-catastrophe losses. For catastrophe losses, the Company determines claim counts based on claims reported and development expectations from previous catastrophes and applies an average expected loss per claim based on loss reserves established by adjusters and average losses on previous similar catastrophes. Derivative Financial Instruments The Company accounts for all derivative instruments, other than those that meet the normal purchases and sales exception, as either an asset or liability, measured at fair value, which is based on information obtained from independent parties. In addition, changes in fair value are recognized in earnings unless specific hedge accounting criteria are met. The Company’s derivative instruments include total return swaps and options sold. See Note 8. Derivative Financial Instruments. Earnings Per Share Basic earnings per share excludes dilution and reflects net income divided by the weighted average shares of common stock outstanding during the periods presented. Diluted earnings per share is based on the weighted average shares of common stock and potential dilutive securities outstanding during the periods presented. At December 31, 2015 and 2014 , potential dilutive securities consisted of outstanding stock options and restricted stock units ("RSUs") granted from the Company's 2013 Long Term Incentive Plan. See Note 16. Earnings Per Share , for the required disclosures relating to the calculation of basic and diluted earnings per share. Income Taxes Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting basis and the respective tax basis of the Company’s assets and liabilities, and expected benefits of utilizing net operating loss, capital loss, and tax-credit carryforwards. The Company assesses the likelihood that its deferred tax assets will be realized and, to the extent management does not believe these assets are more likely than not to be realized, a valuation allowance is established. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or laws is recognized in earnings in the period that includes the enactment date. At December 31, 2015 , the Company’s deferred income taxes were in a net asset position, which included a combination of ordinary and capital deferred tax benefits. In assessing the Company's ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon generating sufficient taxable income of the appropriate character within the carryback and carryforward periods available under the tax law. Management considers the reversal of deferred tax liabilities, projected future taxable income of an appropriate nature, and tax-planning strategies in making this assessment. The Company believes that through the use of prudent tax planning strategies and the generation of capital gains, sufficient income will be realized in order to maximize the full benefits of its deferred tax assets. Although realization is not assured, management believes that it is more likely than not that the Company’s deferred tax assets will be realized. Reinsurance Liabilities for unearned premiums and unpaid losses are stated in the accompanying consolidated financial statements before deductions for ceded reinsurance. The ceded amounts are immaterial and are carried in other receivables. Earned premiums are stated net of deductions for ceded reinsurance. The Insurance Companies, as primary insurers, are required to pay losses to the extent reinsurers are unable to discharge their obligations under the reinsurance agreements. Share-Based Compensation Share-based compensation expense for all share-based payment awards granted or modified is based on the estimated grant-date fair value. The Company recognizes these compensation costs on a straight-line basis over the requisite service period of the award, which is the option vesting term of four or five years for options granted prior to 2008 and four years for options granted subsequent to January 1, 2008, for only those shares expected to vest. The fair value of stock option awards is estimated using the Black-Scholes option pricing model with the grant-date assumptions and weighted-average fair values. The fair value of each restricted stock unit grant was determined based on the market price on the grant date. Compensation cost is recognized based on management’s best estimate of the performance goals that will be achieved. If such goals are not met, no compensation cost is recognized and any recognized compensation cost would be reversed. See Note 15. Share-Based Compensation for additional disclosures. Recently Issued Accounting Standards In January 2016, the FASB issued Accounting Standards Update ("ASU") 2016-01, "Financial Instruments-Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities." The amendments in this ASU update address certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01: (1) requires equity investments (except those accounted for under the equity method or those that result in the consolidation of the investee) to be measured at fair value with changes in the fair value recognized in net income; (2) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) requires the use of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and (4) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the notes to the financial statements. These amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company does not anticipate that ASU 2016-01 will have a material impact on its consolidated financial statements and related disclosures. In May 2015, the FASB issued ASU 2015-09, "Financial Services-Insurance (Topic 944) Disclosures About Short-Duration Contracts." ASU 2015-9 requires insurance entities to provide additional disclosures related to claims liabilities. The additional disclosure requirements for the annual reports include: (1) the claims development information by accident year, on a net of reinsurance basis, for the number of years for which claims incurred remain outstanding but not to exceed the most recent 10 years , and for the most recent reporting period presented, an insurer also needs to disclose the amount of total net outstanding claims for all accident years included in the claims development tables; (2) a reconciliation of claims development information and the aggregate carrying amount of the liability for unpaid claims and claim adjustment expenses; and (3) information about the claims frequency and the amount of the incurred-but-not-reported liabilities for each accident year presented. In addition, a description of the methodologies and assumptions used to determine the amounts disclosed and significant changes in methodologies and assumptions are required. The roll forward of the liability for unpaid claims and claims adjustment expenses, currently required only for annual periods, will also be required for interim periods. This standard will be effective for annual periods beginning after December 15, 2015, and interim periods within annual reporting periods beginning after December 15, 2016. Although the adoption of this standard will not have a material impact on its consolidated financial statements, the Company will expand the nature and extent of its insurance contracts disclosures. In February 2015, the FASB issued ASU 2015-02, "Consolidation (Topic 810) Amendments to the Consolidation Analysis" affecting the consolidation evaluation of limited partnerships and similar entities, fees paid to a decision maker or a service provider as a variable interest, and variable interests in a variable interest entity held by related parties of the reporting entities. The amendments are effective for annual and interim reporting periods beginning after December 15, 2015. The adoption of the new standard will not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, "Revenue Recognition (Topic 606): Revenue from Contracts with Customers." ASU 2014-09 requires entities to apply a five-step model to determine the amount and timing of revenue recognition. The model specifies, among other criteria, that revenue should be recognized when an entity transfers control of goods or services to a customer at the amount at which the entity expects to be entitled. In August 2015, the FASB issued an update which defers the effective date of this standard to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that annual reporting period. Early adoption is now permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that annual reporting period. The Company is evaluating the impact of this standard on its consolidated financial statements and related disclosures. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments The financial instruments recorded in the consolidated balance sheets include investments, receivables, options sold, total return swaps, accounts payable,and secured and unsecured notes payable. Due to their short-term maturity, the carrying values of receivables and accounts payable approximate their fair values. All investments are carried at fair value on the consolidated balance sheets. The following table presents estimated fair values of financial instruments: December 31, 2015 2014 (Amounts in thousands) Assets Investments $ 3,380,642 $ 3,403,822 Liabilities Total return swaps $ 11,525 $ 4,025 Options sold $ 260 $ 194 Secured notes $ 140,000 $ 140,000 Unsecured note $ 150,000 $ 150,000 Investments The Company applies the fair value option to all fixed maturity and equity securities and short-term investments at the time an eligible item is first recognized. The cost of investments sold is determined on a first-in and first-out method and realized gains and losses are included in net realized investment (losses) gains. See Note 3. Investments for additional information. Options Sold The Company writes covered call options through listed and over-the-counter exchanges. When the Company writes an option, an amount equal to the premium received by the Company is recorded as a liability and is subsequently adjusted to the current fair value of the option written. Premiums received from writing options that expire unexercised are treated by the Company on the expiration date as realized gains from investments. If a call option is exercised, the premium is added to the proceeds from the sale of the underlying security or currency in determining whether the Company has realized a gain or loss. The Company, as writer of an option, bears the market risk of an unfavorable change in the price of the security underlying the written option. Liabilities for covered call options of $0.3 million and $0.2 million were included in other liabilities at December 31, 2015 and 2014 , respectively. Total Return Swaps The fair values of the total return swaps reflect the estimated amounts that, upon termination of the contracts, would be received for selling an asset or paid to transfer a liability in an orderly transaction at December 31, 2015 and 2014 based on models using inputs, such as interest rate yield curves and credit spreads, observable for substantially the full term of the contract. Secured notes payable The fair value of the Company's $120 million secured note and $20 million secured note, classified as Level 2 in the fair value hierarchy described in Note 4. Fair Value Measurement, is estimated based on assumptions and inputs, such as the market value of underlying collateral and reset rates, for similarly termed notes that are observable in the market. The fair values of the secured notes approximated their carrying values. Unsecured note payable The fair value of the Company's $150.0 million unsecured n ote, classified as Level 2 in the fair value hierarchy described in Note 4. Fair Value Measurement, is based on the unadjusted quoted price for similar notes in active markets. The fair value of the unsecured note approximated its carrying value. For additional disclosures regarding methods and assumptions used in estimating fair values, see Note 4. Fair Value Measurement. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2015 | |
Investments [Abstract] | |
Investments | Investments The following table presents (losses) gains due to changes in fair value of investments that are measured at fair value pursuant to application of the fair value option: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Fixed maturity securities $ (39,304 ) $ 77,208 $ (100,703 ) Equity securities (22,988 ) (32,922 ) 56,822 Short-term investments 561 (527 ) (156 ) Total $ (61,731 ) $ 43,759 $ (44,037 ) The following table presents gross gains (losses) realized on the sales of investments: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Gross Realized Gains Gross Realized Losses Net Gross Realized Gains Gross Realized Losses Net Gross Realized Gains Gross Realized Losses Net Fixed maturity securities $ 631 $ (495 ) $ 136 $ 7,015 $ (9,734 ) $ (2,719 ) $ 9,320 $ (3,842 ) $ 5,478 Equity securities 41,305 (58,764 ) (17,459 ) 59,342 (17,705 ) 41,637 82,385 (58,297 ) 24,088 Short-term investments — (1,396 ) (1,396 ) — (1,943 ) (1,943 ) — (903 ) (903 ) Contractual Maturity At December 31, 2015 , fixed maturity holdings rated below investment grade and non-rated comprised 1.3% of total investments at fair value. Additionally, the Company owns securities that are credit enhanced by financial guarantors that are subject to uncertainty related to market perception of the guarantors’ ability to perform. Determining the estimated fair value of municipal bonds could become more difficult should markets for these securities become illiquid. The following table presents the estimated fair values of the Company's fixed maturity securities at December 31, 2015 by contractual maturity. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Estimated Fair Value (Amounts in thousands) Fixed maturity securities: Due in one year or less $ 108,775 Due after one year through five years 394,240 Due after five years through ten years 609,243 Due after ten years 1,767,745 Total $ 2,880,003 Investment Income The following table presents a summary of net investment income: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Fixed maturity securities $ 108,122 $ 104,946 $ 107,926 Equity securities 14,630 17,313 18,249 Short-term investments 9,033 8,561 2,702 Total investment income $ 131,785 $ 130,820 $ 128,877 Less: investment expense (5,486 ) (5,097 ) (4,339 ) Net investment income $ 126,299 $ 125,723 $ 124,538 |
Fair Value Measurement
Fair Value Measurement | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Fair Value Measurement | Fair Value Measurement The Company employs a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date using the exit price. Accordingly, when market observable data are not readily available, the Company’s own assumptions are set to reflect those that market participants would be presumed to use in pricing the asset or liability at the measurement date. Assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the level of judgment associated with inputs used to measure their fair value and the level of market price observability, as follows: Level 1 Unadjusted quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs are other than quoted prices in active markets, which are based on the following: • Quoted prices for similar assets or liabilities in active markets; • Quoted prices for identical or similar assets or liabilities in non-active markets; or • Either directly or indirectly observable inputs as of the reporting date. Level 3 Pricing inputs are unobservable and significant to the overall fair value measurement, and the determination of fair value requires significant management judgment or estimation. In certain cases, inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurement in its entirety. Thus, a Level 3 fair value measurement may include inputs that are observable (Level 1 or Level 2) and unobservable (Level 3). The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and consideration of factors specific to the asset or liability. The Company uses prices and inputs that are current as of the measurement date, including during periods of market disruption. In periods of market disruption, the ability to observe prices and inputs may be reduced for many instruments. This condition could cause an instrument to be reclassified from Level 1 to Level 2, or from Level 2 to Level 3. The Company recognizes transfers between levels at either the actual date of the event or a change in circumstances that caused the transfer. Summary of Significant Valuation Techniques for Financial Assets and Financial Liabilities The Company’s fair value measurements are based on the market approach, which utilizes market transaction data for the same or similar instruments. The Company obtained unadjusted fair values on 99.7% of its portfolio from an independent pricing service. For 0.3% of its portfolio, classified as Level 3, the Company obtained specific unadjusted broker quotes based on net fund value and, to a lesser extent, unobservable inputs from at least one knowledgeable outside security broker to determine the fair value as of December 31, 2015 . At December 31, 2015 and 2014 , $10.4 million and $11.7 million , respectively, of equity securities were valued based on broker quotes for underlying debt and credit instruments and an estimated benchmark spread for similar assets in active markets. Level 1 Measurements —Fair values of financial assets and financial liabilities are obtained from an independent pricing service, and are based on unadjusted quoted prices for identical assets or liabilities in active markets. Additional pricing services and closing exchange values are used as a comparison to ensure that reasonable fair values are used in pricing the investment portfolio. U.S. government bonds and agencies/Short-term bonds : Valued using unadjusted quoted market prices for identical assets in active markets. Common stock : Comprised of actively traded, exchange listed U.S. and international equity securities and valued based on unadjusted quoted prices for identical assets in active markets. Money market instruments : Valued based on unadjusted quoted prices for identical assets in active markets. Options sold/Purchased options : Comprised of free-standing exchange listed derivatives that are actively traded and valued based on quoted prices for identical instruments in active markets. Level 2 Measurements —Fair values of financial assets and financial liabilities are obtained from an independent pricing service or outside brokers, and are based on prices for similar assets or liabilities in active markets or valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Additional pricing services are used as a comparison to ensure reliable fair values are used in pricing the investment portfolio. Municipal securities : Valued based on models or matrices using inputs such as quoted prices for identical or similar assets in active markets. Mortgage-backed securities : Comprised of securities that are collateralized by residential and commercial mortgage loans and valued based on models or matrices using multiple observable inputs, such as benchmark yields, reported trades and broker/dealer quotes, for identical or similar assets in active markets. The Company had holdings of $37.3 million and $32.5 million at December 31, 2015 and 2014 , respectively, in commercial mortgage-backed securities. Corporate securities/Short-term bonds : Valued based on a multi-dimensional model using multiple observable inputs, such as benchmark yields, reported trades, broker/dealer quotes and issue spreads, for identical or similar assets in active markets. Non-redeemable preferred stock : Valued based on observable inputs, such as underlying and common stock of same issuer and appropriate spread over a comparable U.S. Treasury security, for identical or similar assets in active markets. Total return swaps : Valued based on multi-dimensional models using inputs such as interest rate yield curves, underlying debt/credit instruments and the appropriate benchmark spread for similar assets in active markets, observable for substantially the full term of the contract. Collateralized loan obligations : Valued based on underlying debt instruments and the appropriate benchmark spread for similar assets in active markets. Other asset-backed securities : Comprised of securities that are collateralized by non-mortgage assets, such as automobile loans, valued based on models or matrices using multiple observable inputs, such as benchmark yields, reported trades and broker/dealer quotes, for identical or similar assets in active markets. Secured notes payable : Valued based on underlying collateral and reset rates for similarly termed notes that are observable in the market. Unsecured notes payable : Valued based on the unadjusted quoted price for similar notes in active markets. Level 3 Measurements —Fair values of financial assets are based on inputs that are both unobservable and significant to the overall fair value measurement, including any items in which the evaluated prices obtained elsewhere were deemed to be of a distressed trading level. Collateralized debt obligations/Private equity funds : Valued based on underlying debt/credit instruments and the appropriate benchmark spread for similar assets in active markets; taking into consideration unobservable inputs related to liquidity assumptions. The Company’s financial instruments at fair value are reflected in the consolidated balance sheets on a trade-date basis. Related unrealized gains or losses are recognized in net realized investment (losses) gains in the consolidated statements of operations. Fair value measurements are not adjusted for transaction costs. The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair values: December 31, 2015 Level 1 Level 2 Level 3 Total (Amounts in thousands) Assets Fixed maturity securities: U.S. government bonds and agencies $ 22,507 $ — $ — $ 22,507 Municipal securities — 2,505,040 — 2,505,040 Mortgage-backed securities — 49,838 — 49,838 Corporate securities — 243,372 — 243,372 Collateralized loan obligations — 50,548 — 50,548 Other asset-backed securities — 8,698 — 8,698 Equity securities: Common stock 280,263 — — 280,263 Non-redeemable preferred stock — 24,668 — 24,668 Private equity funds — 0 10,431 10,431 Short-term investments: Short-term bonds 69,991 9,850 — 79,841 Money market instruments 105,436 0 — 105,436 Total assets at fair value $ 478,197 $ 2,892,014 $ 10,431 $ 3,380,642 Liabilities Notes payable: Secured Notes $ — $ 140,000 $ — $ 140,000 Unsecured Notes — 150,000 — 150,000 Other liabilities: Total return swaps — 11,525 — 11,525 Options sold 260 — — 260 Total liabilities at fair value $ 260 $ 301,525 $ — $ 301,785 December 31, 2014 Level 1 Level 2 Level 3 Total (Amounts in thousands) Assets Fixed maturity securities: U.S. government bonds and agencies $ 16,108 $ — $ — $ 16,108 Municipal securities — 2,275,455 — 2,275,455 Mortgage-backed securities — 47,691 — 47,691 Corporate securities — 256,930 — 256,930 Collateralized debt obligations — 22,216 — 22,216 Equity securities: Common stock: 372,598 — — 372,598 Non-redeemable preferred stock — 28,563 — 28,563 Private equity funds — — 11,719 11,719 Short-term investments: Short-term bonds 69,999 18,362 — 88,361 Money market instruments 284,181 — — 284,181 Total assets at fair value $ 742,886 $ 2,649,217 $ 11,719 $ 3,403,822 Liabilities Notes payable: Secured Notes $ — $ 140,000 $ — $ 140,000 Unsecured Notes — 150,000 — 150,000 Other liabilities: Total return swaps — 4,025 — 4,025 Options sold 194 — — 194 Total liabilities at fair value $ 194 $ 294,025 $ — $ 294,219 The following table presents a summary of changes in fair value of Level 3 financial assets and financial liabilities: Year Ended December 31, 2015 2014 Collateralized Debt Obligations Partnership Interest in a Private Credit Fund Collateralized Debt Obligations Partnership Interest in a Private Credit Fund (Amounts in thousands) Beginning Balance $ — $ 11,719 $ 4,302 $ 12,548 Realized losses included in earnings — (4,175 ) (755 ) (829 ) Reclassification from other assets — 2,911 — — Sales — — (3,547 ) — Settlements — (24 ) — — Ending Balance $ — $ 10,431 $ — $ 11,719 The amount of total losses for the period included in earnings attributable to assets still held at December 31 $ — $ (5,385 ) $ — $ (829 ) There were no transfers between Levels 1, 2, and 3 of financial assets and financial liabilities that were fair valued on a recurring basis in 2015 and 2014 . At December 31, 2015 , the Company did not have any nonrecurring fair value measurements of nonfinancial assets or nonfinancial liabilities. |
Fixed Assets
Fixed Assets | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Fixed Assets | Fixed Assets The following table presents the components of fixed assets: December 31, 2015 2014 (Amounts in thousands) Land $ 26,770 $ 26,770 Buildings and improvements 132,529 131,174 Furniture and equipment 109,802 107,288 Capitalized software 178,113 162,065 Leasehold improvements 9,109 8,991 456,323 436,288 Less accumulated depreciation and amortization (299,192 ) (277,312 ) Fixed assets, net $ 157,131 $ 158,976 Depreciation expense, including amortization of leasehold improvements, was $20.5 million , $22.1 million , and $24.6 million during 2015 , 2014 , and 2013 , respectively. |
Deferred Policy Acquisition Cos
Deferred Policy Acquisition Costs | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs Deferred policy acquisition costs were as follows: December 31, 2015 2014 2013 (Amounts in thousands) Balance, beginning of year $ 197,202 $ 194,466 $ 185,910 Policy acquisition costs deferred 543,791 528,944 514,073 Amortization (539,231 ) (526,208 ) (505,517 ) Balance, end of year $ 201,762 $ 197,202 $ 194,466 |
Notes Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2015 | |
Notes Payable [Abstract] | |
Notes Payable | Notes Payable Notes payable consists of the following: December 31, Lender Interest Rate Expiration 2015 2014 (Amounts in thousands) Secured credit facility Bank of America LIBOR plus 40 basis points December 3, 2017 $ 120,000 $ 120,000 Secured loan Union Bank LIBOR plus 40 basis points December 3, 2017 20,000 20,000 Unsecured credit facility Bank of America and Union Bank (1) December 3, 2019 150,000 150,000 Total $ 290,000 $ 290,000 __________ (1) On July 2, 2013, the Company entered into an unsecured $200 million five -year revolving credit facility. The interest rate on borrowings under the credit facility is based on the Company's debt to total capital ratio and ranges from LIBOR plus 112.5 basis points when the ratio is under 15% to LIBOR plus 162.5 basis points when the ratio is above 25% . Commitment fees for the undrawn portions of the credit facility range from 12.5 basis points when the ratio is under 15% to 22.5 basis points when the ratio is above 25% . Debt to capital ratio is expressed as a percentage of (i) consolidated debt to (ii) consolidated shareholders' equity plus consolidated debt. Effective December 3, 2014, the Company extended the maturity date of the unsecured credit facility from June 30, 2018 to December 3, 2019, and expanded the borrowing capacity from $200 million to $250 million . In 2015 and 2014, the interest rate was LIBOR plus 112.5 basis points on the $150 million of borrowings and 12.5 basis points on the undrawn portion of the credit facility. The interest rate was approximately 1.53% at December 31, 2015. The $120 million credit facility is secured by municipal bonds held as collateral. The collateral requirement is calculated as the fair market value of the municipal bonds held as collateral multiplied by the advance rates, which vary based on the credit quality and duration of the assets held and range between 75% and 100% of the fair value of each bond. Effective December 3, 2014, the Company extended the maturity date of the $120 million credit facility from July 31, 2016 to December 3, 2017. On December 12, 2014, the Company extended the maturity date of the $20 million bank loan from January 2, 2015 to December 3, 2017. The $20 million bank loan has collateral requirements similar to those of the $120 million credit facility. The credit facilities and bank loan contain financial covenants pertaining to minimum statutory surplus, debt to capital ratio, and risk-based capital ("RBC") ratio. The Company was in compliance with all of its loan covenants at December 31, 2015 . The aggregated maturities of notes payable are as follows: Maturity (Amounts in thousands) 2016 $ — 2017 $ 140,000 2018 $ — 2019 $ 150,000 |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Dec. 31, 2015 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Derivative Financial Instruments | Derivative Financial Instruments The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed by using derivative instruments are equity price risk and interest rate risk. Equity contracts (options sold) on various equity securities are intended to manage the price risk associated with forecasted purchases or sales of such securities. The Company also enters into derivative contracts to enhance returns on its investment portfolio. On February 13, 2014, Fannette Funding LLC ("FFL"), a special purpose investment vehicle, formed by and consolidated into the Company, entered into a total return swap agreement with Citibank. Under the total return swap agreement, FFL receives the income equivalent on underlying obligations due to Citibank and pays to Citibank interest on the outstanding notional amount of the underlying obligations. The total return swap is secured by approximately $30 million of U.S. Treasuries as collateral, which are included in short-term investments on the consolidated balance sheets. The Company paid interest equal to LIBOR plus 135 basis points on approximately $95 million of underlying obligations as of December 31, 2015 . The agreement had an initial term of one year , subject to annual renewal, and was renewed for an additional one -year term expiring February 13, 2017 , with interest equal to LIBOR plus 145 basis points. On August 9, 2013, Animas Funding LLC ("AFL"), a special purpose investment vehicle, formed by and consolidated into the Company, entered into a three -year total return swap agreement with Citibank. Under the total return swap agreement, AFL receives the income equivalent on underlying obligations due to Citibank and pays to Citibank interest equal to LIBOR plus 120 basis points on the outstanding notional amount of the underlying obligations, which was approximately $124 million as of December 31, 2015 . The total return swap is secured by approximately $40 million of U.S. Treasuries as collateral, which are included in short-term investments on the consolidated balance sheets. Fair value amounts, and (losses) gains on derivative instruments The following tables present the location and amounts of derivative fair values in the consolidated balance sheets and derivative (losses) gains in the consolidated statements of operations: Asset Derivatives Liability Derivatives December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 (Amounts in thousands) Total return swaps - Other assets $ — $ — $ — $ — Options sold - Other liabilities — — 260 194 Total return swaps - Other liabilities — — 11,525 4,025 Total derivatives $ — $ — $ 11,785 $ 4,219 (Losses) Gains Recognized in Income Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Total return swaps - Net realized investment (losses) gains $ (6,438 ) $ (2,969 ) $ 2,176 Options sold - Net realized investment gains 3,081 3,419 1,776 Interest rate contract - Other revenue — — 103 Total $ (3,357 ) $ 450 $ 4,055 Most options sold consist of covered calls. The Company writes covered calls on underlying equity positions held as an enhanced income strategy that is permitted for the Company’s insurance subsidiaries under statutory regulations. The Company manages the risk associated with covered calls through strict capital limitations and asset diversification throughout various industries. For additional disclosures regarding equity contracts, see Note 4. Fair Value Measurement. |
Other Intangible Assets
Other Intangible Assets | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Other Intangible Assets | Other Intangible Assets The following table presents the components of other intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Useful Lives (Amounts in thousands) (in years) As of December 31, 2015: Customer relationships $ 52,430 $ (34,327 ) $ 18,103 11 Trade names 15,400 (4,491 ) 10,909 24 Technology 4,300 (3,010 ) 1,290 10 Insurance license 1,400 — 1,400 Indefinite Total intangible assets, net $ 73,530 $ (41,828 ) $ 31,702 As of December 31, 2014: Customer relationships $ 51,755 $ (29,402 ) $ 22,353 11 Trade names 15,400 (3,850 ) 11,550 24 Technology 4,300 (2,580 ) 1,720 10 Total intangible assets, net $ 71,455 $ (35,832 ) $ 35,623 The Company recognized $1.4 million of other intangible assets for a state insurance license related to the acquisition of Workmen's Auto Insurance Company. See Note 20. Acquisition for the acquisition's cost allocation. Other intangible assets are reviewed annually for impairment and more frequently if potential impairment indicators exist. No impairment indicators were identified during any of the periods presented. Other intangible assets with definite useful lives are amortized on a straight-line basis over their useful lives. Other intangible assets amortization expense was $6.0 million in each of the years ended December 31, 2015 , 2014 , and 2013 . None of the intangible assets with definite useful lives are anticipated to have a residual value. The following table presents the estimated future amortization expense related to other intangible assets as of December 31, 2015 : Year Ending December 31, Amortization Expense (Amounts in thousands) 2016 $ 6,077 2017 5,349 2018 5,335 2019 4,906 2020 758 Thereafter 7,877 Total $ 30,302 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |
Income Taxes | Income Taxes Income tax provision The Company and its subsidiaries file a consolidated federal income tax return. The income tax (benefit) expense consisted of the following components: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Federal Current $ 21,942 $ 44,469 $ 30,266 Deferred (25,594 ) 20,444 (14,970 ) $ (3,652 ) $ 64,913 $ 15,296 State Current $ 943 $ 4,421 $ 5,234 Deferred (1,203 ) 142 (577 ) $ (260 ) $ 4,563 $ 4,657 Total Current $ 22,885 $ 48,890 $ 35,500 Deferred (26,797 ) 20,586 (15,547 ) Total $ (3,912 ) $ 69,476 $ 19,953 The income tax (benefit) expense reflected in the consolidated statements of operations is reconciled to the federal income tax (benefit) expense on income before income taxes based on a statutory rate of 35% as shown in the table below: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Computed tax expense at 35% $ 24,699 $ 86,598 $ 46,234 Tax-exempt interest income (26,993 ) (27,839 ) (26,381 ) Dividends received deduction (1,613 ) (2,027 ) (2,239 ) State tax expense (287 ) 3,872 4,944 Nondeductible expenses 575 9,900 190 Other, net (293 ) (1,028 ) (2,795 ) Income tax (benefit) expense $ (3,912 ) $ 69,476 $ 19,953 Deferred Income Taxes Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting basis and the respective tax basis of the Company’s assets and liabilities, and expected benefits of utilizing net operating loss, capital loss, and tax-credit carryforwards. The ultimate realization of deferred tax assets is dependent upon generating sufficient taxable income of the appropriate character within the carryback and carryforward periods available under the tax law. Management considers the reversal of deferred tax liabilities, projected future taxable income of an appropriate nature, and tax-planing strategies in making this assessment. The Company believes that through the use of prudent tax planning strategies and the generation of capital gains, sufficient income will be realized in order to maximize the full benefits of its deferred tax assets. The following table presents the significant components of the Company’s net deferred tax assets and liabilities: December 31, 2015 2014 (Amounts in thousands) Deferred tax assets: 20% of net unearned premium $ 75,406 $ 71,907 Discounting of loss reserves and salvage and subrogation recoverable for tax purposes 9,518 11,100 Write-down of impaired investments 857 942 Tax credit carryforward 36,349 31,198 Expense accruals 11,264 13,395 Other deferred tax assets 9,596 7,448 Total gross deferred tax assets 142,990 135,990 Deferred tax liabilities: Deferred acquisition costs (70,617 ) (69,021 ) Tax liability on net unrealized gain on securities carried at fair value (23,095 ) (47,333 ) Tax depreciation in excess of book depreciation (10,742 ) (9,414 ) Undistributed earnings of insurance subsidiaries (4,022 ) (4,486 ) Tax amortization in excess of book amortization (2,514 ) (1,982 ) Other deferred tax liabilities (8,769 ) (9,087 ) Total gross deferred tax liabilities (119,759 ) (141,323 ) Net deferred tax assets (liabilities) $ 23,231 $ (5,333 ) The Company had an alternative minimum tax credit carryforward balance of $36.3 million and $31.2 million at December 31, 2015 and 2014, respectively, which is not subject to expiration. Uncertainty in Income Taxes The Company recognizes tax benefits related to positions taken, or expected to be taken, on a tax return only if, the positions are "more-likely-than-not" sustainable. Once this threshold has been met, the Company’s measurement of its expected tax benefits is recognized in its financial statements. There was a $0.4 million decrease to the total amount of unrecognized tax benefits related to tax uncertainties during 2015 . The decrease was the result of tax positions taken regarding state tax apportionment issues based on management’s best judgment given the facts, circumstances and information available at the reporting date. The Company does not expect any changes in such unrecognized tax benefits to have a significant impact on its consolidated financial statements within the next 12 months . The Company and its subsidiaries file income tax returns with the Internal Revenue Service and the taxing authorities of various states. Tax years that remain subject to examination by major taxing jurisdictions are 2012 through 2014 for federal taxes and 2003 through 2014 for California state taxes. The Company is currently under examination by the California Franchise Tax Board ("FTB") for tax years 2003 through 2013. The FTB issued Notices of Proposed Assessments to the Company for tax years 2003 through 2010, which the Company formally protested. The proposed adjustments for tax years 2003 through 2006 were affirmed following an administrative protest process with the FTB examination. The Company is in settlement discussions with the FTB. If a reasonable settlement is not reached, the Company intends to pursue other options, including a formal hearing with the State Board of Equalization or litigation in superior court. Management believes that the resolution of these examinations and assessments will not have a material impact on the consolidated financial statements. The following table presents a reconciliation of the beginning and ending balances of unrecognized tax benefits: December 31, 2015 2014 (Amounts in thousands) Balance at January 1 $ 12,612 $ 10,784 Additions based on tax positions related to: Current year 932 2,277 Prior years (1,379 ) (258 ) Additions (reductions) as a result of lapse of the applicable statute of limitations — (191 ) Balance at December 31 $ 12,165 $ 12,612 As presented above, the balances of unrecognized tax benefits were $12.2 million and $12.6 million at December 31, 2015 and 2014 , respectively. Of these totals, $10.9 million and $11.1 million represent unrecognized tax benefits, net of federal tax benefit and accrued interest expense which, if recognized, would impact the Company’s effective tax rate. Management does not expect the Company's total amount of unrecognized tax benefits to materially increase within the next twelve months. The Company recognizes interest and penalties related to unrecognized tax benefits as a part of income taxes. During the years ended December 31, 2015 , 2014 , and 2013 , the Company recognized net interest and penalty expense, excluding refunds, of $112,000 , $739,000 , and $1,119,000 , respectively. The Company carried an accrued interest and penalty balance of $2,915,000 and $2,803,000 at December 31, 2015 and 2014 , respectively. |
Losses And Loss Adjustment Expe
Losses And Loss Adjustment Expenses | 12 Months Ended |
Dec. 31, 2015 | |
Insurance Loss Reserves [Abstract] | |
Losses and Loss Adjustment Expenses | Losses and Loss Adjustment Expenses The following table presents the activity in the reserves for losses and loss adjustment expenses: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Gross reserves at January 1 $ 1,091,797 $ 1,038,984 $ 1,036,123 Less reinsurance recoverable (14,484 ) (13,927 ) (12,155 ) Net reserves at January 1 1,077,313 1,025,057 1,023,968 Acquisition of WAIC reserves 18,676 — — Incurred losses and loss adjustment expenses related to: Current year 2,132,837 1,989,315 1,959,730 Prior years 12,658 (3,193 ) 2,960 Total incurred losses and loss adjustment expenses 2,145,495 1,986,122 1,962,690 Loss and loss adjustment expense payments related to: Current year 1,455,245 1,347,967 1,354,074 Prior years 654,097 585,899 607,527 Total payments 2,109,342 1,933,866 1,961,601 Net reserves at December 31 1,132,142 1,077,313 1,025,057 Reinsurance recoverable 14,546 14,484 13,927 Gross reserves at December 31 $ 1,146,688 $ 1,091,797 $ 1,038,984 The increase in the provision for insured events of prior years in 2015 of approximately $12.7 million primarily resulted from the California homeowners and automobile lines of business outside of California, which was partially offset by favorable development in the California automobile line of business. The decrease in the provision for insured events of prior years in 2014 of approximately $3.2 million primarily resulted from lower than expected loss severity on California personal automobile lines of insurance business partially offset by adverse development in other states. The increase in the provision for insured events of prior years in 2013 of approximately $3.0 million primarily resulted from Florida claims that were re-opened from prior years due to a state supreme court ruling that was adverse to the insurance industry. The Company experienced estimated pre-tax catastrophe losses and loss adjustment expenses from severe weather events of $19 million , $11 million , and $17 million in 2015 , 2014 , and 2013 , respectively. The losses in 2015 were primarily the result of severe storms outside of California, and rainstorm and wildfire losses in California. The losses in 2014 were primarily related to winter freeze events on the East Coast and severe rainstorms in California. The losses in 2013 were primarily due to tornadoes in Oklahoma and severe storms in the Midwest and the Southeast regions during the second quarter. |
Dividends
Dividends | 12 Months Ended |
Dec. 31, 2015 | |
Dividends [Abstract] | |
Dividends | Dividends The following table presents shareholder dividends paid: Year Ended December 31, 2015 2014 2013 (Amounts in thousands, except per share data) Total paid $ 136,386 $ 135,496 $ 134,776 Per share paid $ 2.4725 $ 2.4625 $ 2.4525 The Insurance Companies are subject to the financial capacity guidelines established by their domiciliary states. The payment of dividends from statutory unassigned surplus of the Insurance Companies is restricted, subject to certain statutory limitations. For 2015, the insurance subsidiaries of the Company are permitted to pay approximately $164 million in dividends to Mercury General without the prior approval of the DOI of domiciliary states. The above statutory regulations may have the effect of indirectly limiting the ability of the Company to pay shareholder dividends. During 2015 , 2014 , and 2013 , the Insurance Companies paid the Mercury General ordinary dividends of $133 million , $225 million , and $120 million , respectively. On February 5, 2016, the Board of Directors declared a $0.62 quarterly dividend payable on March 31, 2016 to shareholders of record on March 17, 2016. |
Statutory Balances and Accounti
Statutory Balances and Accounting Practices | 12 Months Ended |
Dec. 31, 2015 | |
Statutory Balances And Accounting Practices [Abstract] | |
Statutory Balances and Accounting Practices | Statutory Balances and Accounting Practices The Insurance Companies prepare their statutory-basis financial statements in conformity with accounting practices prescribed or permitted by the insurance departments of their domiciliary states. Prescribed statutory accounting practices primarily include those published as statements of statutory accounting principles by the National Association of Insurance Commissioners (the "NAIC"), as well as state laws, regulations, and general administrative rules. Permitted statutory accounting practices encompass all accounting practices not so prescribed. As of December 31, 2015 , there were no material permitted statutory accounting practices utilized by the Insurance Companies. The following table presents the statutory net income, and statutory capital and surplus of the Insurance Companies, as reported to regulatory authorities: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Statutory net income (1) $ 123,984 $ 155,654 $ 235,251 Statutory capital and surplus $ 1,451,950 $ 1,438,281 $ 1,528,682 __________ (1) Statutory net income reflects differences from GAAP net income, including changes in the fair value of the investment portfolio as a result of the application of the fair value option. The Insurance Companies must comply with minimum capital requirements under applicable state laws and regulations. The RBC formula is used by insurance regulators to monitor capital and surplus levels. It was designed to capture the widely varying elements of risks undertaken by writers of different lines of insurance business having differing risk characteristics, as well as writers of similar lines where differences in risk may be related to corporate structure, investment policies, reinsurance arrangements, and a number of other factors. The Company periodically monitors the RBC level of each of the Insurance Companies. As of December 31, 2015, 2014, and 2013, each of the Insurance Companies exceeded the minimum required RBC levels , as determined by the NAIC and adopted by the state insurance regulators. None of the Insurance Companies’ RBC ratios was less than 375% of the authorized control level RBC as of December 31, 2015 , 2014 and 2013 . Generally, an RBC ratio of 200% or less would require some form of regulatory or company action. |
Profit Sharing Plan and Annual
Profit Sharing Plan and Annual Cash Bonuses | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Compensation Arrangements [Abstract] | |
Profit Sharing Plan and Annual Cash Bonuses | Profit Sharing Plan and Annual Cash Bonuses The Company’s employees are eligible to become members of the Profit Sharing Plan (the "Plan"). The Company, at the option of the Board of Directors, may make annual contributions to the Plan, and the contributions are not to exceed the greater of the Company’s net income for the plan year or its retained earnings at that date. In addition, the annual contributions may not exceed an amount equal to 15% of the compensation paid or accrued during the year to all participants under the Plan. No contributions were made in the past three years . The Plan includes an option for employees to make salary deferrals under Section 401(k) of the Internal Revenue Code. The matching contributions, at a rate set by the Board of Directors, totaled $8.5 million , $8.0 million , and $8.1 million for 2015 , 2014 , and 2013 , respectively. The Plan also includes an employee stock ownership plan that covers substantially all employees. The Board of Directors authorizes the Plan to purchase the Company’s common stock in the open market for allocation to the Plan participants. No purchases were made during the past three years . The Company also provides annual cash bonuses to eligible employees based on performance criteria for each recipient and for the Company as a whole. The Company performance goals were based on the Company's premium growth and combined ratio. The Company paid annual cash bonuses of $20.7 million , $19.1 million , and $0.0 million in 2015 , 2014 , and 2013 , respectively. |
Share-Based Compensation
Share-Based Compensation | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Share-Based Compensation | Share-Based Compensation In February 2015, the Company adopted the 2015 Incentive Award Plan (the "2015 Plan"), replacing the 2005 Equity Incentive Plan (the "2005 Plan") which expired in January 2015. The 2015 Plan was approved at the Company's Annual Meeting of Shareholders in May 2015. A maximum of 4,900,000 shares of common stock under the 2015 Plan are authorized for issuance upon exercise of stock options, stock appreciation rights and other awards, or upon vesting of restricted or deferred stock awards. As of December 31, 2015 , only stock options and restricted stock unit awards have been granted under these plans. Beginning January 1, 2008, stock options granted, for which the Company has recognized share-based compensation expense, become exercisable at a rate of 25% per year beginning one year from the date granted, are granted at the closing price of the Company's stock on the date of grant, and expire after 10 years. Prior to January 1, 2008, stock options granted became exercisable at a rate of 20% per year. Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Cash received from stock option exercises $ 2,111 $ 6,247 $ 1,446 Compensation cost 5,208 4,112 974 Excess tax benefit 27 148 202 Stock Option Awards No stock options were awarded in 2015 and 2014 under the 2015 Plan and 2005 Plan, respectively. The fair values of stock options awarded in 2013 under the 2005 Plan were estimated on the dates of grant using a closed-form option valuation model (Black-Scholes). The following table provides the assumptions used in the calculation of grant-date fair values of stock options awarded during 2013 based on the Black-Scholes option pricing model. 2013 Weighted-average grant-date fair value $7.11 Expected volatility 33.16% - 33.18% Weighted-average expected volatility 33.17% Risk-free interest rate 0.88% - 1.60% Expected dividend yield 5.40% - 5.76% Expected term in months 72 Expected volatilities are based on historical volatility of the Company’s stock over the term of the stock options. The Company estimated the expected term of stock options, which represents the period of time that stock options granted are expected to be outstanding, by using historical exercise patterns and post-vesting termination behavior. The risk free interest rate is determined based on U.S. Treasury yields with equivalent remaining terms in effect at the time of the grant. The following table presents a summary of the stock option activity under the Company’s plans for the year ended December 31, 2015 : Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in 000’s) Outstanding at January 1, 2015 248,000 $ 49.85 Granted — Exercised (43,000) $ 49.10 Canceled or expired (37,000) $ 58.48 Outstanding at December 31, 2015 168,000 $ 48.14 3.8 $ 305 Exercisable at December 31, 2015 128,000 $ 49.58 2.7 $ 183 The aggregate intrinsic values in the table above represent the total pre-tax intrinsic value (the difference between the Company’s closing stock price and the stock option exercise price, multiplied by the number of in-the-money stock options) that would have been received by the stock option holders had all stock options been exercised on December 31, 2015 . The aggregate intrinsic values of stock options exercised were $303,000 , $1,160,000 , and $862,000 during 2015 , 2014 , and 2013 , respectively. The total fair values of stock options vested were $142,000 , $142,000 , and $146,000 during 2015 , 2014 , and 2013 , respectively. The following table presents information regarding stock options outstanding at December 31, 2015 : Options Outstanding Options Exercisable Range of Exercise Prices Number of Options Weighted-Average Remaining Contractual Life (Years) Weighted- Average Exercise Price Number of Options Weighted- Average Exercise Price $33.61-$47.61 88,000 6.1 $ 43.29 48,000 $ 43.09 $50.01-$51.51 38,000 2.0 $ 50.72 38,000 $ 50.72 $54.93-$57.50 42,000 0.8 $ 55.96 42,000 $ 55.96 As of December 31, 2015 , $202,000 of total unrecognized compensation cost related to non-vested stock options is expected to be recognized over a weighted-average remaining contractual life of 1.4 years . Restricted Stock Unit Awards Under the 2015 Plan and 2005 Plan, the Compensation Committee of the Company’s Board of Directors granted performance-based vesting restricted stock unit awards to the Company’s senior management and key employees. The following table presents the restricted stock unit grants summary at December 31, 2015 : Grant Year 2015 2014 2013 Three-year performance period ending December 31, 2017 2016 2015 Vesting shares, target (net of forfeited) 99,250 85,500 78,500 Vesting shares, maximum (net of forfeited) 186,094 160,313 176,625 The following table presents a summary of restricted stock unit awards activity during the years indicated: Year Ended December 31, 2015 2014 2013 Shares Weighted- Average Fair Value per Share Shares Weighted- Average Fair Value per Share Shares Weighted- Average Fair Value per Share Outstanding at January 1 167,000 $ 41.15 170,500 $ 39.64 169,000 $ 42.22 Granted 100,250 $ 53.80 93,500 $ 45.17 84,500 $ 36.82 Vested — — — Forfeited/Canceled (4,000) $ 43.10 (16,500) $ 43.99 (3,000) $ 36.82 Expired — $ — (80,500) $ 44.01 (80,000) $ 40.22 Outstanding at December 31 263,250 $ 45.94 167,000 $ 41.15 170,500 $ 39.64 The restricted stock units vest at the end of a three-year performance period beginning with the year of the grant, and then only if, and to the extent that, the Company’s performance during the performance period achieves the threshold established by the Compensation Committee of the Company’s Board of Directors. For 2013, 2014 and 2015 grants, vesting is based on the Company’s cumulative underwriting income, annual underwriting income, and net earned premium growth. As of December 31, 2015, 1,000 , 8,000 , and 6,000 target restricted stock units granted in 2015, 2014 and 2013, respectively, have been forfeited because the recipients were no longer employed by the Company. Expired shares represent shares that did not meet the vesting requirements. The fair value of each restricted stock unit grant was determined based on the closing price of the Company's common stock on the grant date. Compensation cost is recognized based on management’s best estimate that performance goals will be achieved. If such goals are not met, no compensation cost would be recognized and any previously recognized compensation cost would be reversed. |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Reconciliation [Abstract] | |
Earnings Per Share | Earnings Per Share The following table presents a reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations: Year Ended December 31, 2015 2014 2013 Income (Numerator) Weighted Shares (Denominator) Per-Share Amount Income (Numerator) Weighted Shares (Denominator) Per-Share Amount Income (Numerator) Weighted Shares (Denominator) Per-Share Amount (Amounts and numbers in thousands, except per-share data) Basic EPS Income available to common stockholders $ 74,479 55,157 $ 1.35 $ 177,949 55,008 $ 3.23 $ 112,143 54,947 $ 2.04 Effect of dilutive securities: Options — 15 — 12 — 17 RSUs — 37 — — — — Diluted EPS Income available to common stockholders after assumed conversions $ 74,479 55,209 $ 1.35 $ 177,949 55,020 $ 3.23 $ 112,143 54,964 $ 2.04 Potentially dilutive securities representing approximately 67,000 , 252,000 , and 359,000 shares of common stock for 2015 , 2014 , and 2013 , respectively, were excluded from the computation of diluted earnings per common share because their effect would have been anti-dilutive. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Operating Leases The Company is obligated under various non-cancellable lease agreements providing for office space, automobiles, and office equipment that expire at various dates through the year 2021 . For leases that contain predetermined escalations of the minimum rentals, the Company recognizes the related rent expense on a straight-line basis and records the difference between the recognized rental expense and amounts payable under the leases as deferred rent in other liabilities. This liability amounted to $3.6 million and $4.4 million at December 31, 2015 and 2014 , respectively. Total rent expense under these lease agreements was $16.0 million , $14.6 million , and $19.3 million for 2015 , 2014 , and 2013 , respectively. The following table presents future minimum commitments for operating leases as of December 31, 2015 : Year Ending December 31, Operating Leases (Amounts in thousands) 2016 $ 14,765 2017 11,008 2018 4,684 2019 1,006 2020 463 Thereafter 64 California Earthquake Authority ("CEA") The CEA is a quasi-governmental organization that was established to provide a market for earthquake coverage to California homeowners. The Company places all new and renewal earthquake coverage offered with its homeowners policies directly with the CEA. The Company receives a small fee for placing business with the CEA, which is recorded as other income in the consolidated statements of operations. Upon the occurrence of a major seismic event, the CEA has the ability to assess participating companies for losses. These assessments are made after CEA capital has been expended and are based upon each company’s participation percentage multiplied by the amount of the total assessment. Based upon the most recent information provided by the CEA, the Company’s maximum total exposure to CEA assessments at April 1, 2015, the most recent date at which information was available, was approximately $64.3 million . There was no assessment made in 2015. Regulatory Matters In April 2010, the California DOI ("CDI") issued a Notice of Non-Compliance ("2010 NNC") to MIC, MCC, and CAIC based on a Report of Examination of the Rating and Underwriting Practices of these companies issued by the CDI in February 2010. The 2010 NNC included allegations of 35 instances of noncompliance with applicable California insurance law and sought to require that each of MIC, MCC, and CAIC change its rating and underwriting practices to rectify the alleged noncompliance and reserved the right to seek monetary penalties. In April 2010, the Company submitted a Statement of Compliance and Notice of Defense to the CDI, in which it denied the allegations contained in the 2010 NNC and provided specific defenses to each allegation. The Company also requested a hearing in the event that the Statement of Compliance and Notice of Defense did not establish to the satisfaction of the CDI that the alleged noncompliance did not exist, and the matters described in the 2010 NNC were not able to be resolved informally with the CDI. While continuing to dispute the CDI's allegations, the Company implemented various changes requested by the CDI and engaged in settlement discussions in the interest of avoiding further litigation. On March 2, 2015, MIC, MCC and CAIC entered into an agreement with the CDI, pursuant to which all allegations in the 2010 NNC were settled for $1 million, which was subsequently paid, and the case was resolved. In March 2006, the CDI issued an Amended Notice of Non-Compliance to a Notice of Non-Compliance originally issued in February 2004 (as amended, "2004 NNC") alleging that the Company charged rates in violation of the California Insurance Code, willfully permitted its agents to charge broker fees in violation of California law, and willfully misrepresented the actual price insurance consumers could expect to pay for insurance by the amount of a fee charged by the consumer’s insurance broker. The CDI sought to impose a fine for each policy on which the Company allegedly permitted an agent to charge a broker fee, to impose a penalty for each policy on which the Company allegedly used a misleading advertisement, and to suspend certificates of authority for a period of one year. In January 2012, the administrative law judge (the "ALJ") bifurcated the 2004 NNC between (a) the CDI’s order to show cause (the "OSC"), in which the CDI asserts the false advertising allegations and accusation, and (b) the CDI’s notice of noncompliance, in which the CDI asserts the unlawful rate allegations. In February 2012, the ALJ submitted a proposed decision dismissing the NNC, based on conduct by the CDI and the Commissioner in violation of the Company's due process rights. Specifically, the ALJ found that the CDI's attorneys and the Commissioner engaged in improper ex parte communication, and commenced a rule making in order to supersede unfavorable evidentiary rulings by the ALJ. The Commissioner rejected the ALJ's proposed decision. The Company challenged the rejection in Los Angeles Superior Court in April 2012, but the challenge was unsuccessful. The Court did not rule on the merits of the ALJ's due process concerns, but merely held that the Company was required to exhaust its administrative remedies before seeking relief in the Superior Court. The case was referred back to the ALJ, and the due process issues raised by the ALJ's dismissal were preserved for later appeal. Following an evidentiary hearing in April 2013, post-hearing briefs and an unsuccessful mediation, the ALJ closed the evidentiary record on April 30, 2014. Although a proposed decision was to be submitted to the Commissioner on or before June 30, 2014, after which the Commissioner would have 100 days to accept, reject or modify the proposed decision, or required further evidence, the proposed decision was submitted on December 8, 2014. On January 7, 2015, the Commissioner adopted the ALJ's proposed decision, which became the Commissioner's adopted Order. The Company received notice of this Order on January 10, 2015. The decision and Order found that from the period July 1, 1996 through 2006, the Company's "brokers" were actually operating as "de facto agents" and that the charging of "broker fees" by these producers constituted the charging of "premium" in excess of the Company’s approved rates. The Order assessed a civil penalty in the amount of $27.6 million against the Company. The Company denies the allegations and/or findings in the Order, and believes that no monetary penalties are warranted. On February 9, 2015, the Company filed a Writ of Administrative Mandamus and Complaint for Declaratory Relief (the "Writ") in the Orange County Superior Court seeking, among other things, to require the Commissioner to vacate the Order, to stay the Order while the Superior Court action is pending, and to judicially declare as invalid the Commissioner’s interpretation of certain provisions of the California Insurance Code. Subsequent to the filing of the Writ, a consumer group petitioned and was granted the right to intervene in the Superior Court action. The court did not order a stay, and the $27.6 million assessed penalty was accrued in 2014 and paid in March 2015. The Company filed an amended Writ on September 11, 2015, adding an explicit request for a refund of the penalty, with interest. The court initially scheduled the matter for hearing on March 14, 2016, with the opening brief due October 19, 2015. The Company filed its opening brief, but the Commissioner then requested an extension of time to file an opposing brief and for the hearing on the Writ. The extension was granted, and the hearing is now scheduled for June 13, 2016. The Company intends to vigorously defend itself against the allegations, and seeks reversal of the $27.6 million assessed fine, unless a reasonable settlement can be reached. The Company has also accrued a liability for the estimated cost to continue to defend itself in the false advertising OSC. Based upon its understanding of the facts and the California Insurance Code, the Company does not expect that the ultimate resolution of the false advertising OSC will be material to the its financial position. Litigation The Company is, from time to time, named as a defendant in various lawsuits or regulatory actions incidental to its insurance business. The majority of lawsuits brought against the Company relate to insurance claims that arise in the normal course of business and are reserved for through the reserving process. For a discussion of the Company’s reserving methods, see Note 1. Summary of Significant Accounting Policies. The Company also establishes reserves for non-insurance claims related lawsuits, regulatory actions, and other contingencies when the Company believes a loss is probable and is able to estimate its potential exposure. For loss contingencies believed to be reasonably possible, the Company also discloses the nature of the loss contingency and an estimate of the possible loss, range of loss, or a statement that such an estimate cannot be made. While actual losses may differ from the amounts recorded and the ultimate outcome of the Company’s pending actions is generally not yet determinable, the Company does not believe that the ultimate resolution of currently pending legal or regulatory proceedings, either individually or in the aggregate, will have a material adverse effect on its financial condition, results of operations, or cash flows. In all cases, the Company vigorously defends itself unless a reasonable settlement appears appropriate. The Company is also involved in proceedings relating to assessments and rulings made by the FTB. See Note 10. Income Taxes. There are no environmental proceedings arising under federal, state, or local laws or regulations to be discussed. |
Risks and Uncertainties
Risks and Uncertainties | 12 Months Ended |
Dec. 31, 2015 | |
Risks and Uncertainties [Abstract] | |
Risks and Uncertainties | Risks and Uncertainties Many businesses are still experiencing the effects of uncertain conditions in the global economy and capital markets, reduced consumer spending and confidence, and continued volatility, which could adversely impact the Company’s financial condition, results of operations, and liquidity. Further, the volatility and disruptions in global capital markets could adversely affect the Company’s investment portfolio. Although the disruption in the global financial markets has moderated, not all global financial markets are functioning normally. The Company is unable to predict the impact of current and future global economic conditions on the United States, and California, where the majority of the Company’s business is produced. The Company applies the fair value option to its investment portfolio. Rapidly changing and unprecedented credit and equity market conditions could materially impact the valuation of securities as reported within the Company’s financial statements, and the period-to-period changes in value could vary significantly. Decreases in market value may have a material adverse effect on the Company’s financial condition or results of operations. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Acquisition | Pursuant to an October 22, 2014 Stock Purchase Agreement, the Company purchased all the issued and outstanding shares of Workmen’s Auto Insurance Company ("WAIC"), a California domiciled property and casualty insurance company, on January 2, 2015. WAIC is a Los Angeles-based non-standard, private passenger automobile insurance company that operates predominantly in California. The Company intends to use the WAIC non-standard automobile product to complement the Company’s preferred and standard product offerings. The Company paid $8 million in cash for the shares of WAIC, of which $2 million has been withheld in escrow for up to three years as security for any loss development on claims incurred on or prior to June 30, 2014. Based on the evaluation performed at the acquisition date and at December 31, 2015, of the claims reserves for WAIC for losses and loss adjustment expenses incurred on or prior to June 30, 2014, the Company estimates that it will recover the $2 million held in escrow and, therefore, the Company has deducted it from cash consideration to arrive at the fair value of total consideration transferred. In accordance with regulatory approval requirements, the Company made a $15 million cash capital contribution to WAIC on January 12, 2015. |
Quarterly Financial Information
Quarterly Financial Information | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Quarterly Financial Information | Quarterly Financial Information (Unaudited) The following table presents summarized quarterly financial data for 2015 and 2014 : Quarter Ended March 31 June 30 September 30 December 31 (Amounts in thousands, except per share data) 2015 Net premiums earned $ 720,737 $ 731,546 $ 745,520 $ 760,094 Change in fair value of investments pursuant to the fair value option $ (4,884 ) $ (40,783 ) $ (18,538 ) $ 2,474 Income before income taxes $ 29,859 $ 4,511 $ 12,267 $ 23,930 Net income $ 26,165 $ 9,639 $ 15,270 $ 23,405 Basic earnings per share (2) $ 0.47 $ 0.17 $ 0.28 $ 0.42 Diluted earnings per share (2) $ 0.47 $ 0.17 $ 0.28 $ 0.42 Dividends paid per share $ 0.6175 $ 0.6175 $ 0.6175 $ 0.6200 2014 Net premiums earned $ 683,701 $ 697,889 $ 705,237 $ 709,368 Change in fair value of investments pursuant to the fair value option $ 45,699 $ 41,412 $ (20,528 ) $ (22,824 ) Income (loss) before income taxes $ 102,030 $ 136,436 $ 37,120 $ (28,161 ) Net income (loss) $ 72,649 $ 94,960 $ 31,296 $ (20,956 ) Basic earnings per share $ 1.32 $ 1.73 $ 0.57 $ (0.38 ) Diluted earnings per share $ 1.32 $ 1.73 $ 0.57 $ (0.38 ) (1) Dividends paid per share $ 0.6150 $ 0.6150 $ 0.6175 $ 0.6175 __________ (1) The dilutive impact of incremental shares is excluded from net loss position in accordance with GAAP. (2) The basic and diluted earnings per share do not sum due to rounding. Net income during 2015 was primarily affected by net realized investment losses, an increase in losses and loss adjustment expenses partially offset by an increase in net premiums earned. Net income during the fourth quarter of 2015 was affected by net realized investment losses of $8.2 million as compared with net loss during the fourth quarter of 2014 which was affected by net realized investment losses of $21.6 million and by the $27.6 million penalty assessed by the California DOI and accrued by the Company in the fourth quarter of 2014. Net income during 2014 was primarily affected by the $27.6 million penalty assessed by California DOI, higher net premiums earned and increases in the fair value of the Company’s investment portfolio offset by catastrophe related losses. See Note 17. Commitments and Contingencies for "2004 NNC" discussion. The primary causes of the net loss during the fourth quarter of 2014 were the $27.6 million penalty described above, the declines in the fair value of the Company’s equity securities due to the overall decline in the equity market, and the severe rainstorms in California. Net income during 2013 was primarily affected by higher net premiums earned offset by catastrophe related losses, and declines in the fair value of the Company’s investment portfolio due to the overall decline in the municipal bond markets. Net income during 2013 was also affected by the consolidation of claims and underwriting operations located outside of California into hub locations, which resulted in approximately $10 million of pre-tax office closure costs and severance related expense during the first quarter of 2013. The primary causes of the net loss during the second quarter of 2013 were increased losses resulting from catastrophe losses due to tornadoes in Oklahoma and severe storms in the Midwest and the Southeast regions, and declines in the fair value of the Company’s municipal and equity securities due to the overall decline in the municipal and equity markets. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | Segment Information The Company is primarily engaged in writing personal automobile insurance and provides related property and casualty insurance products to its customers through 14 subsidiaries in 13 states, principally in California. The Company has one reportable business segment - the Property and Casualty business segment. Property and Casualty Lines The Property and Casualty business segment offers several insurance products to the Company’s individual customers and small business customers. These insurance products are: private passenger automobile which is the Company’s primary business, and related insurance products such as homeowners, commercial automobile and commercial property. These insurance products are primarily sold to the Company’s individual customers and small business customers, which increases retention of the Company’s private personal automobile client base. The insurance products comprising the Property and Casualty business segment are sold through the same distribution channels, mainly through independent and 100% owned insurance agents, and go through a similar underwriting process. The Company’s Chief Operating Decision Maker evaluates operating results based on pre-tax underwriting results which is calculated as net premiums earned less (i) incurred losses and loss adjustment expenses; and (ii) underwriting expenses (policy acquisition costs and other operating expenses). Expenses are allocated based on certain assumptions that are primarily related to premiums and losses. The Company’s net investment income, net realized investment (losses) gains, other income, and interest expense are excluded in evaluating pre-tax underwriting profit. The Company does not allocate its assets, including investments, or income taxes in evaluating pre-tax underwriting profit. The following table presents operating results by reportable segment for the years ended: December 31, 2015 December 31, 2014 December 31, 2013 Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total (Amounts in millions) Net premiums earned $ 2,906.6 $ 51.3 $ 2,957.9 $ 2,737.3 $ 58.9 $ 2,796.2 $ 2,638.4 $ 59.8 $ 2,698.2 Less: Incurred expenses 2,117.3 28.2 2,145.5 1,951.4 34.7 1,986.1 1,926.4 36.3 1,962.7 Underwriting expenses 770.0 20.0 790.0 749.7 25.9 775.6 701.0 23.9 724.9 Underwriting gain 19.3 3.1 22.4 36.2 (1.7 ) 34.5 11.0 (0.4 ) 10.6 Investment income 126.3 125.7 124.5 Net realized investment (losses) gains (83.8 ) 81.1 (11.4 ) Other income 8.9 8.7 9.7 Interest expense (3.2 ) (2.6 ) (1.3 ) Pre-tax income $ 70.6 $ 247.4 $ 132.1 Net income $ 74.5 $ 177.9 $ 112.1 The following table presents the Company’s direct premiums written and net premiums earned by line of insurance business for the years ended: December 31, 2015 December 31, 2014 December 31, 2013 Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total (Amounts in millions) Private passenger automobile $ 2,345.8 $ — $ 2,345.8 $ 2,223.1 $ — $ 2,223.1 $ 2,165.6 $ — $ 2,165.6 Homeowners 402.2 — 402.2 374.5 — 374.5 340.0 — 340.0 Commercial automobile 153.5 — 153.5 135.9 — 135.9 104.7 — 104.7 Other 81.6 29.8 111.4 75.4 44.3 119.7 64.4 62.8 127.2 Direct premiums written $ 2,983.1 $ 29.8 $ 3,012.9 $ 2,808.9 $ 44.3 2,853.2 $ 2,674.7 $ 62.8 $ 2,737.5 Private passenger automobile $ 2,308.6 $ — $ 2,308.6 $ 2,203.0 $ — $ 2,203.0 $ 2,163.4 $ — $ 2,163.4 Homeowners 379.7 — 379.7 347.9 — 347.9 328.5 — 328.5 Commercial automobile 144.4 — 144.4 121.8 — 121.8 88.3 — 88.3 Other 73.9 51.3 125.2 64.6 58.9 123.5 58.2 59.8 118.0 Net premiums earned $ 2,906.6 $ 51.3 $ 2,957.9 $ 2,737.3 $ 58.9 $ 2,796.2 $ 2,638.4 $ 59.8 $ 2,698.2 __________ (1) "Other" represents net premiums written and earned from an operating segment that does not meet the quantitative thresholds required to be considered a reportable segment. This operating segment offers automobile mechanical breakdown warranties which are sold through auto dealerships and credit unions. |
Summary Of Investments Other Th
Summary Of Investments Other Than Investments In Related Parties | 12 Months Ended |
Dec. 31, 2015 | |
Summary of Investments, Other than Investments in Related Parties [Abstract] | |
Summary Of Investments Other Than Investments In Related Parties | MERCURY GENERAL CORPORATION AND SUBSIDIARIES SUMMARY OF INVESTMENTS OTHER THAN INVESTMENTS IN RELATED PARTIES DECEMBER 31, 2015 Type of Investment Cost Fair Value Amounts in the Balance Sheet (Amounts in thousands) Fixed maturity securities: U.S. government bonds and agencies $ 22,542 $ 22,507 $ 22,507 Municipal securities 2,417,046 2,505,039 2,505,039 Mortgage-backed securities 49,639 49,839 49,839 Corporate securities 255,606 243,372 243,372 Collateralized loan obligations 50,710 50,548 50,548 Other asset-backed securities 8,732 8,698 8,698 Total fixed maturity securities 2,804,275 2,880,003 2,880,003 Equity securities: Common stock 275,479 280,263 280,263 Non-redeemable preferred stock 25,161 24,668 24,668 Private equity funds 12,888 10,431 10,431 Total equity securities 313,528 315,362 315,362 Short-term investments 185,353 185,277 185,277 Total investments $ 3,303,156 $ 3,380,642 $ 3,380,642 SCHEDULE I, Continued MERCURY GENERAL CORPORATION AND SUBSIDIARIES SUMMARY OF INVESTMENTS OTHER THAN INVESTMENTS IN RELATED PARTIES DECEMBER 31, 2014 Type of Investment Cost Fair Value Amounts in the Balance Sheet (Amounts in thousands) Fixed maturity securities: U.S. government bonds and agencies $ 16,028 $ 16,108 $ 16,108 Municipal securities 2,160,710 2,275,455 2,275,455 Mortgage-backed securities 45,519 47,691 47,691 Corporate securities 258,940 256,930 256,930 Collateralized loan obligations 22,297 22,216 22,216 Total fixed maturity securities 2,503,494 2,618,400 2,618,400 Equity securities: Common stock 349,839 372,598 372,598 Non-redeemable preferred stock 28,012 28,563 28,563 Private equity funds 10,000 11,719 11,719 Total equity securities 387,851 412,880 412,880 Short-term investments 373,180 372,542 372,542 Total investments $ 3,264,525 $ 3,403,822 $ 3,403,822 |
Condensed Financial Information
Condensed Financial Information of Registrant | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Financial Information of Registrant | MERCURY GENERAL CORPORATION CONDENSED FINANCIAL INFORMATION OF REGISTRANT BALANCE SHEETS December 31, 2015 2014 (Amounts in thousands) ASSETS Investments, at fair value: Fixed maturity securities (cost $557; $0) $ 571 $ — Equity securities (cost $131,217; $189,032) 127,572 182,300 Short-term investments (cost $1,144; $9,744) 1,144 9,744 Investment in subsidiaries 1,819,426 1,783,049 Total investments 1,948,713 1,975,093 Cash 20,139 52,326 Accrued investment income 208 158 Amounts receivable from affiliates 220 1,181 Current income taxes 8,894 239 Deferred income taxes 10,524 6,975 Income tax receivable from affiliates 5,917 3,482 Other assets 2,981 1,095 Total assets $ 1,997,596 $ 2,040,549 LIABILITIES AND SHAREHOLDERS’ EQUITY Notes payable $ 150,000 $ 150,000 Amounts payable to affiliates 25 97 Income tax payable to affiliates 26,439 14,728 Other liabilities 247 278 Total liabilities 176,711 165,103 Commitments and contingencies Shareholders’ equity: Common stock 90,985 88,705 Additional paid-in capital 8,870 3,804 Retained earnings 1,721,030 1,782,937 Total shareholders’ equity 1,820,885 1,875,446 Total liabilities and shareholders’ equity $ 1,997,596 $ 2,040,549 SCHEDULE II, Continued MERCURY GENERAL CORPORATION CONDENSED FINANCIAL INFORMATION OF REGISTRANT STATEMENTS OF OPERATIONS Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Revenues: Net investment income $ 4,314 $ 4,478 $ 1,293 Net realized investment (losses) gains (7,026 ) (9,428 ) 3,416 Total revenues (2,712 ) (4,950 ) 4,709 Expenses: Other operating expenses 7,526 5,971 2,924 Interest 2,127 1,746 318 Total expenses 9,653 7,717 3,242 (Loss) income before income taxes and equity in net income of subsidiaries (12,365 ) (12,667 ) 1,467 Income tax (benefit) expense (4,708 ) (100 ) 3,310 Loss before equity in net income of subsidiaries (7,657 ) (12,567 ) (1,843 ) Equity in net income of subsidiaries 82,136 190,516 113,986 Net income $ 74,479 $ 177,949 $ 112,143 SCHEDULE II, Continued MERCURY GENERAL CORPORATION CONDENSED FINANCIAL INFORMATION OF REGISTRANT STATEMENTS OF CASH FLOWS Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Cash flows from operating activities: Net cash provided by (used in) operating activities $ 548 $ (3,434 ) $ (843 ) Cash flows from investing activities: Capital contribution to subsidiaries (90,125 ) (30,125 ) (40,125 ) Distributions received from special purpose entities 8,883 6,756 — Dividends received from subsidiaries 133,000 225,000 120,000 Purchases of fixed maturity securities available for sale in nature (571 ) — — Equity securities available for sale in nature Purchases (146,236 ) (254,572 ) (25,038 ) Sales 192,005 90,422 25,798 (Decrease) in payable for securities, net — (2,489 ) 2,489 Net decrease in short-term investments 8,612 1,346 36,085 Business acquisition (6,000 ) — — Other, net 1,945 2,191 895 Net cash provided by investing activities 101,513 38,529 120,104 Cash flows from financing activities: Dividends paid to shareholders (136,386 ) (135,496 ) (134,776 ) Excess tax benefit from exercise of stock options 27 148 202 Proceeds from stock options exercised 2,111 6,247 1,446 Proceeds from bank loan — 100,000 50,000 Net cash used in financing activities (134,248 ) (29,101 ) (83,128 ) Net (decrease) increase in cash (32,187 ) 5,994 36,133 Cash: Beginning of year 52,326 46,332 10,199 End of year $ 20,139 $ 52,326 $ 46,332 SUPPLEMENTAL CASH FLOW DISCLOSURE Interest paid $ 2,153 $ 1,757 $ 318 Income taxes paid (received) $ 1,807 $ 2,112 $ (827 ) The accompanying condensed financial information should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements included in this report. Distributions received from Special Purpose Entities On February 13, 2014, Fannette Funding LLC ("FFL"), a special purpose investment vehicle, formed by and consolidated into the Company, entered into a total return swap agreement with Citibank. Under the total return swap agreement, FFL receives the income equivalent on underlying obligations due to Citibank and pays to Citibank interest on the outstanding notional amount of the underlying obligations. The total return swap is secured by approximately $30 million of U.S. Treasuries as collateral, which are included in short-term investments on the consolidated balance sheets. The Company paid interest equal to LIBOR plus 135 basis points on approximately $95 million of underlying obligations as of December 31, 2015 . The agreement had an initial term of one year , subject to annual renewal, and was renewed for an additional one -year term expiring February 13, 2017 , with interest equal to LIBOR plus 145 basis points. On August 9, 2013, Animas Funding LLC ("AFL"), a special purpose investment vehicle, formed by and consolidated into the Company, entered into a three -year total return swap agreement with Citibank. Under the total return swap agreement, AFL receives the income equivalent on underlying obligations due to Citibank and pays to Citibank interest equal to LIBOR plus 120 basis points on the outstanding notional amount of the underlying obligations, which was approximately $124 million as of December 31, 2015 . The total return swap is secured by approximately $40 million of U.S. Treasuries as collateral, which are included in short-term investments on the consolidated balance sheets. Distributions of $8.9 million and $6.8 million were received in 2015 and 2014, respectively, from these special purpose entities. Dividends received from Subsidiaries Dividends of $133,000,000 , $225,000,000 and $120,000,000 were received by Mercury General from its 100% owned insurance subsidiaries in 2015, 2014 and 2013, respectively, and are recorded as a reduction to investment in subsidiaries. Capitalization of Insurance Subsidiaries Mercury General made capital contributions to its insurance subsidiaries of $ 90,125,000 , $30,125,000 and $40,125,000 in 2015, 2014 and 2013. Business Acquisition Pursuant to an October 22, 2014 Stock Purchase Agreement, Mercury General purchased all the issued and outstanding shares of Workmen’s Auto Insurance Company ("WAIC"), a California domiciled property and casualty insurance company, on January 2, 2015. WAIC is a Los Angeles-based non-standard, private passenger automobile insurance company that operates predominantly in California. Mercury General intends to use the WAIC non-standard automobile product to complement its preferred and standard product offerings. Mercury General paid $8 million in cash for the shares of WAIC, of which $2 million has been withheld in escrow for up to three years as security for any loss development on claims incurred on or prior to June 30, 2014. Based on the evaluation performed at the acquisition date and at December 31, 2015, of the claims reserves for WAIC for losses and loss adjustment expenses incurred on or prior to June 30, 2014, Mercury General estimates that it will recover the $2 million held in escrow, and therefore deducted it from cash consideration to arrive at the fair value of total consideration transferred. In accordance with regulatory approval requirements, Mercury General made a $15 million cash capital contribution to WAIC on January 12, 2015. Notes Payable On July 2, 2013, Mercury General entered into an unsecured $200 million five -year revolving credit facility. Effective December 3, 2014, the Company expanded the borrowing capacity from $200 million to $250 million . Total borrowings were $150 million as of December 31, 2015. The interest rate was approximately 1.53% at December 31, 2015. Commitments and Contingencies The borrowings by MCC, a subsidiary, under the $120 million credit facility and $20 million bank loan are secured by approximately $180 million of municipal bonds owned by MCC, at fair value, held as collateral. The total borrowings of $140 million are guaranteed by Mercury General. Federal Income Taxes The Company files a consolidated federal income tax return for the following entities: Mercury Casualty Company Mercury County Mutual Insurance Company Mercury Insurance Company Mercury Insurance Company of Florida California Automobile Insurance Company Mercury Indemnity Company of America California General Underwriters Insurance Company, Inc. Mercury Select Management Company, Inc. Mercury Insurance Company of Illinois Mercury Insurance Services LLC Mercury Insurance Company of Georgia AIS Management LLC Mercury Indemnity Company of Georgia Auto Insurance Specialists LLC Mercury National Insurance Company PoliSeek AIS Insurance Solutions, Inc. American Mercury Insurance Company Animas Funding LLC American Mercury Lloyds Insurance Company Fannette Funding LLC Workman's Auto Insurance Company The method of allocation between the companies is subject to an agreement approved by the Board of Directors. Allocation is based upon separate return calculations with current credit for net losses incurred by the insurance subsidiaries to the extent it can be used in the current consolidated return. |
Supplemental Reinsurance Premiu
Supplemental Reinsurance Premiums | 12 Months Ended |
Dec. 31, 2015 | |
Supplementary Insurance Information [Abstract] | |
Supplemental Reinsurance Premiums | SCHEDULE IV MERCURY GENERAL CORPORATION AND SUBSIDIARIES REINSURANCE THREE YEARS ENDED DECEMBER 31, Property and Liability Insurance Earned Premiums 2015 2014 2013 (Amounts in thousands) Direct amounts $ 2,970,424 $ 2,806,889 $ 2,704,401 Ceded to other companies (12,964 ) (11,185 ) (7,059 ) Assumed 437 491 845 Net amounts $ 2,957,897 $ 2,796,195 $ 2,698,187 |
Summary of Significant Accoun31
Summary of Significant Accounting Policies (Policy) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Consolidation and Basis of Presentation | The consolidated financial statements include the accounts of Mercury General Corporation and its subsidiaries: Insurance Companies Mercury Casualty Company ("MCC") Mercury National Insurance Company Mercury Insurance Company ("MIC") American Mercury Insurance Company California Automobile Insurance Company ("CAIC") American Mercury Lloyds Insurance Company (1) California General Underwriters Insurance Company, Inc. Mercury County Mutual Insurance Company (2) Mercury Insurance Company of Illinois Mercury Insurance Company of Florida Mercury Insurance Company of Georgia Mercury Indemnity Company of America Mercury Indemnity Company of Georgia Workmen's Auto Insurance Company ("WAIC") (5) Non-Insurance Companies Mercury Select Management Company, Inc. AIS Management LLC Mercury Insurance Services LLC Auto Insurance Specialists LLC Animas Funding LLC ("AFL") (3) PoliSeek AIS Insurance Solutions, Inc. Fannette Funding LLC ("FFL") (4) __________ (1) American Mercury Lloyds Insurance Company is not owned but is controlled by the Company through its attorney-in-fact, Mercury Select Management Company, Inc. (2) Mercury County Mutual Insurance Company is not owned but is controlled by the Company through a management contract. (3) Special purpose investment vehicle formed in 2013. (4) Special purpose investment vehicle formed in 2014. (5) California domiciled insurance company acquired in 2015. See Note 20. Acquisition. The consolidated financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("GAAP"), which differ in some respects from those filed in reports to insurance regulatory authorities. All intercompany transactions and balances have been eliminated. |
Use of Estimates | The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates require the Company to apply complex assumptions and judgments, and often the Company must make estimates about effects of matters that are inherently uncertain and will likely change in subsequent periods. The most significant assumptions in the preparation of these consolidated financial statements relate to reserves for losses and loss adjustment expenses. Actual results could differ from those estimates. |
Investments | Fixed maturity securities include debt securities, which may have fixed or variable principal payment schedules, may be held for indefinite periods of time, and may be used as a part of the Company’s asset/liability strategy or sold in response to changes in interest rates, anticipated prepayments, risk/reward characteristics, liquidity needs, tax planning considerations, or other economic factors. Premiums and discounts on fixed maturities are amortized using first call date and are adjusted for anticipated prepayments. Premiums and discounts on mortgage-backed securities are adjusted for anticipated prepayment using the retrospective method, with the exception of some beneficial interests in securitized financial assets, which are accounted for using the prospective method. Equity securities consist of non-redeemable preferred stocks, common stocks on which dividend income is partially tax-sheltered by the 70% corporate dividend received deduction, and an interest in private equity funds. Short-term investments include money market accounts, options, and short-term bonds that are highly rated short duration securities and redeemable within one year. |
Deferred Policy Acquisition Costs | Deferred policy acquisition costs consist of commissions paid to outside agents, premium taxes, salaries, and certain other underwriting costs that are incremental or directly related to the successful acquisition of new and renewal insurance contracts and are amortized over the life of the related policy in proportion to premiums earned. Deferred policy acquisition costs are limited to the amount that will remain after deducting from unearned premiums and anticipated investment income, the estimated losses and loss adjustment expenses, and the servicing costs that will be incurred as premiums are earned. The Company’s deferred policy acquisition costs are further limited by excluding those costs not directly related to the successful acquisition of insurance contracts. |
Fixed Assets | Fixed assets are stated at historical cost less accumulated depreciation and amortization. The useful life for buildings is 30 to 40 years . Furniture, equipment, and purchased software are depreciated on a combination of straight-line and accelerated methods over 3 to 7 years . The Company has capitalized certain consulting costs, payroll, and payroll-related costs for employees related to computer software developed for internal use, which are amortized on a straight-line method over the estimated useful life of the software, generally not exceeding 7 years . In accordance with applicable accounting standards, capitalization ceases no later than the point at which a computer software project is substantially complete and ready for its intended use. Leasehold improvements are amortized over the shorter of the useful life of the assets or the life of the associated lease. The Company periodically assesses long-lived assets or asset groups including building and equipment, for recoverability when events or changes in circumstances indicate that their carrying amounts may not be recoverable. If the Company identifies an indicator of impairment, the Company assesses recoverability by comparing the carrying amount of the asset to the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset. An impairment loss is recognized when the carrying amount is not recoverable and is measured as the excess of carrying value over fair value. |
Goodwill And Other Intangible Assets | Goodwill and other intangible assets arise as a result of business acquisitions and consist of the excess of the cost of the acquisitions over the tangible and intangible assets acquired and liabilities assumed and identifiable intangible assets acquired. Identifiable intangible assets consist of the value of customer relationships, trade names, software and technology, and favorable leases, which are all subject to amortization, and an insurance license which is not subject to amortization. The Company evaluates goodwill and other intangible assets for impairment annually or whenever events or changes in circumstances indicate that it is more likely than not that the carrying amount of goodwill and other intangible assets may exceed their implied fair values. The Company qualitatively determines whether, more likely than not, the fair value exceeds the carrying amount of a reporting unit. There are numerous assumptions and estimates underlying the qualitative assessments including future earnings, long-term strategies, and the Company’s annual planning and forecasting process. If these planned initiatives do not accomplish the targeted objectives, the assumptions and estimates underlying the qualitative assessments could be adversely affected and have a material effect upon the Company’s financial condition and results of operations. |
Premium Revenue Recognition | Premium revenue is recognized on a pro-rata basis over the terms of the policies in proportion to the amount of insurance protection provided. Premium revenue includes installment and other fees for services which are recognized in the periods in which the services are rendered. Unearned premiums represent the portion of the written premium related to the unexpired policy term. Unearned premiums are predominantly computed monthly on a pro-rata basis and are stated gross of reinsurance deductions, with the reinsurance deduction recorded in other receivables. |
Losses And Loss Adjustment Expenses | Unpaid losses and loss adjustment expenses are determined in amounts estimated to cover incurred losses and loss adjustment expenses and established based upon the Company’s assessment of claims pending and the development of prior years’ loss liabilities. These amounts include liabilities based upon individual case estimates for reported losses and loss adjustment expenses and estimates of such amounts that are incurred but not reported. Changes in the estimated liability are charged or credited to operations as the losses and loss adjustment expenses are re-estimated. The liability is stated net of anticipated salvage and subrogation recoveries. The amount of reinsurance recoverable is included in other receivables. Estimating loss reserves is a difficult process as many factors can ultimately affect the final settlement of a claim and, therefore, the loss reserve that is required. A key assumption in estimating loss reserves is the degree to which the historical data used to analyze reserves will be predictive of ultimate claim costs on incurred claims. Changes in the regulatory and legal environments, results of litigation, medical costs, the cost of repair materials, and labor rates, among other factors, can impact this assumption. In addition, time can be a critical part of reserving determinations since the longer the span between the incidence of a loss and the payment or settlement of a claim, the more variable the ultimate settlement amount could be. Accordingly, short-tail claims, such as property damage claims, tend to be more reasonably predictable than long-tail liability claims, such as those involving the Company’s bodily injury (BI) coverages. Management believes that the liability for losses and loss adjustment expenses is adequate to cover the ultimate net cost of losses and loss adjustment expenses incurred to date. However, since the provisions for loss reserves are necessarily based upon estimates, the ultimate liability may be more or less than such provisions. The Company analyzes loss reserves quarterly primarily using the incurred loss, paid loss, claim count development, and average severity methods described below. When deciding among methods to use, the Company evaluates the credibility of each method based on the maturity of the data available and the claims settlement practices for each particular line of insurance business or coverage within a line of insurance business. The Company may also evaluate qualitative factors such as known changes in laws or legal ruling that could affect claims handling or other external environmental factors or internal factors that could affect the settlement of claims. When establishing the loss reserve, the Company will generally analyze the results from all of the methods used rather than relying on a single method. While these methods are designed to determine the ultimate losses on claims under the Company’s policies, there is inherent uncertainty in all actuarial models since they use historical data to project outcomes. The Company believes that the techniques it uses provide a reasonable basis in estimating loss reserves. • The incurred loss development method analyzes historical incurred case loss (case reserves plus paid losses) development to estimate ultimate losses. The Company applies development factors against current case incurred losses by accident period to calculate ultimate expected losses. The Company believes that the incurred loss development method provides a reasonable basis for evaluating ultimate losses, particularly in the Company’s larger, more established lines of insurance business which have a long operating history. • The average severity method analyzes historical loss payments and/or incurred losses divided by closed claims and/or total claims to calculate an estimated average cost per claim. From this, the expected ultimate average cost per claim can be estimated. The average severity method coupled with the claim count development method provide meaningful information regarding inflation and frequency trends that the Company believes is useful in establishing loss reserves. The claim count development method analyzes historical claim count development to estimate future incurred claim count development for current claims. The Company applies these development factors against current claim counts by accident period to calculate ultimate expected claim counts. • The paid loss development method analyzes historical payment patterns to estimate the amount of losses yet to be paid. The Company uses this method for losses and loss adjustment expenses. The Company analyzes catastrophe losses separately from non-catastrophe losses. For catastrophe losses, the Company determines claim counts based on claims reported and development expectations from previous catastrophes and applies an average expected loss per claim based on loss reserves established by adjusters and average losses on previous similar catastrophes. |
Derivative Financial Instruments | The Company accounts for all derivative instruments, other than those that meet the normal purchases and sales exception, as either an asset or liability, measured at fair value, which is based on information obtained from independent parties. In addition, changes in fair value are recognized in earnings unless specific hedge accounting criteria are met. The Company’s derivative instruments include total return swaps and options sold. |
Earnings per Share | Basic earnings per share excludes dilution and reflects net income divided by the weighted average shares of common stock outstanding during the periods presented. Diluted earnings per share is based on the weighted average shares of common stock and potential dilutive securities outstanding during the periods presented. |
Income Taxes | Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial reporting basis and the respective tax basis of the Company’s assets and liabilities, and expected benefits of utilizing net operating loss, capital loss, and tax-credit carryforwards. The Company assesses the likelihood that its deferred tax assets will be realized and, to the extent management does not believe these assets are more likely than not to be realized, a valuation allowance is established. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates or laws is recognized in earnings in the period that includes the enactment date. At December 31, 2015 , the Company’s deferred income taxes were in a net asset position, which included a combination of ordinary and capital deferred tax benefits. In assessing the Company's ability to realize deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon generating sufficient taxable income of the appropriate character within the carryback and carryforward periods available under the tax law. Management considers the reversal of deferred tax liabilities, projected future taxable income of an appropriate nature, and tax-planning strategies in making this assessment. The Company believes that through the use of prudent tax planning strategies and the generation of capital gains, sufficient income will be realized in order to maximize the full benefits of its deferred tax assets. Although realization is not assured, management believes that it is more likely than not that the Company’s deferred tax assets will be realized. |
Reinsurance | Liabilities for unearned premiums and unpaid losses are stated in the accompanying consolidated financial statements before deductions for ceded reinsurance. The ceded amounts are immaterial and are carried in other receivables. Earned premiums are stated net of deductions for ceded reinsurance. The Insurance Companies, as primary insurers, are required to pay losses to the extent reinsurers are unable to discharge their obligations under the reinsurance agreements. |
Share-Based Compensation | Share-based compensation expense for all share-based payment awards granted or modified is based on the estimated grant-date fair value. The Company recognizes these compensation costs on a straight-line basis over the requisite service period of the award, which is the option vesting term of four or five years for options granted prior to 2008 and four years for options granted subsequent to January 1, 2008, for only those shares expected to vest. The fair value of stock option awards is estimated using the Black-Scholes option pricing model with the grant-date assumptions and weighted-average fair values. The fair value of each restricted stock unit grant was determined based on the market price on the grant date. Compensation cost is recognized based on management’s best estimate of the performance goals that will be achieved. If such goals are not met, no compensation cost is recognized and any recognized compensation cost would be reversed. |
Recently Issued Accounting Standards | In January 2016, the FASB issued Accounting Standards Update ("ASU") 2016-01, "Financial Instruments-Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities." The amendments in this ASU update address certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01: (1) requires equity investments (except those accounted for under the equity method or those that result in the consolidation of the investee) to be measured at fair value with changes in the fair value recognized in net income; (2) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) requires the use of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and (4) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the notes to the financial statements. These amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company does not anticipate that ASU 2016-01 will have a material impact on its consolidated financial statements and related disclosures. In May 2015, the FASB issued ASU 2015-09, "Financial Services-Insurance (Topic 944) Disclosures About Short-Duration Contracts." ASU 2015-9 requires insurance entities to provide additional disclosures related to claims liabilities. The additional disclosure requirements for the annual reports include: (1) the claims development information by accident year, on a net of reinsurance basis, for the number of years for which claims incurred remain outstanding but not to exceed the most recent 10 years , and for the most recent reporting period presented, an insurer also needs to disclose the amount of total net outstanding claims for all accident years included in the claims development tables; (2) a reconciliation of claims development information and the aggregate carrying amount of the liability for unpaid claims and claim adjustment expenses; and (3) information about the claims frequency and the amount of the incurred-but-not-reported liabilities for each accident year presented. In addition, a description of the methodologies and assumptions used to determine the amounts disclosed and significant changes in methodologies and assumptions are required. The roll forward of the liability for unpaid claims and claims adjustment expenses, currently required only for annual periods, will also be required for interim periods. This standard will be effective for annual periods beginning after December 15, 2015, and interim periods within annual reporting periods beginning after December 15, 2016. Although the adoption of this standard will not have a material impact on its consolidated financial statements, the Company will expand the nature and extent of its insurance contracts disclosures. In February 2015, the FASB issued ASU 2015-02, "Consolidation (Topic 810) Amendments to the Consolidation Analysis" affecting the consolidation evaluation of limited partnerships and similar entities, fees paid to a decision maker or a service provider as a variable interest, and variable interests in a variable interest entity held by related parties of the reporting entities. The amendments are effective for annual and interim reporting periods beginning after December 15, 2015. The adoption of the new standard will not have a material impact on the Company's consolidated financial statements. In May 2014, the FASB issued ASU 2014-09, "Revenue Recognition (Topic 606): Revenue from Contracts with Customers." ASU 2014-09 requires entities to apply a five-step model to determine the amount and timing of revenue recognition. The model specifies, among other criteria, that revenue should be recognized when an entity transfers control of goods or services to a customer at the amount at which the entity expects to be entitled. In August 2015, the FASB issued an update which defers the effective date of this standard to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that annual reporting period. Early adoption is now permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that annual reporting period. The Company is evaluating the impact of this standard on its consolidated financial statements and related disclosures. |
Fair Value of Financial Instr32
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Estimated Fair Values of Financial Instruments | The following table presents estimated fair values of financial instruments: December 31, 2015 2014 (Amounts in thousands) Assets Investments $ 3,380,642 $ 3,403,822 Liabilities Total return swaps $ 11,525 $ 4,025 Options sold $ 260 $ 194 Secured notes $ 140,000 $ 140,000 Unsecured note $ 150,000 $ 150,000 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments [Abstract] | |
Gains And Losses Due To Changes In Fair Value | The following table presents (losses) gains due to changes in fair value of investments that are measured at fair value pursuant to application of the fair value option: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Fixed maturity securities $ (39,304 ) $ 77,208 $ (100,703 ) Equity securities (22,988 ) (32,922 ) 56,822 Short-term investments 561 (527 ) (156 ) Total $ (61,731 ) $ 43,759 $ (44,037 ) |
Gross Gains And Losses Realized On Sales Of Investments | ross gains (losses) realized on the sales of investments: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Gross Realized Gains Gross Realized Losses Net Gross Realized Gains Gross Realized Losses Net Gross Realized Gains Gross Realized Losses Net Fixed maturity securities $ 631 $ (495 ) $ 136 $ 7,015 $ (9,734 ) $ (2,719 ) $ 9,320 $ (3,842 ) $ 5,478 Equity securities 41,305 (58,764 ) (17,459 ) 59,342 (17,705 ) 41,637 82,385 (58,297 ) 24,088 Short-term investments — (1,396 ) (1,396 ) — (1,943 ) (1,943 ) — (903 ) (903 ) |
Estimated Fair Values Of Investments | The following table presents the estimated fair values of the Company's fixed maturity securities at December 31, 2015 by contractual maturity. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Estimated Fair Value (Amounts in thousands) Fixed maturity securities: Due in one year or less $ 108,775 Due after one year through five years 394,240 Due after five years through ten years 609,243 Due after ten years 1,767,745 Total $ 2,880,003 |
Investment Income | The following table presents a summary of net investment income: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Fixed maturity securities $ 108,122 $ 104,946 $ 107,926 Equity securities 14,630 17,313 18,249 Short-term investments 9,033 8,561 2,702 Total investment income $ 131,785 $ 130,820 $ 128,877 Less: investment expense (5,486 ) (5,097 ) (4,339 ) Net investment income $ 126,299 $ 125,723 $ 124,538 |
Fair Value Measurement (Tables)
Fair Value Measurement (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis Valuation Techniques | The following tables present information about the Company’s assets and liabilities measured at fair value on a recurring basis, and indicate the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair values: December 31, 2015 Level 1 Level 2 Level 3 Total (Amounts in thousands) Assets Fixed maturity securities: U.S. government bonds and agencies $ 22,507 $ — $ — $ 22,507 Municipal securities — 2,505,040 — 2,505,040 Mortgage-backed securities — 49,838 — 49,838 Corporate securities — 243,372 — 243,372 Collateralized loan obligations — 50,548 — 50,548 Other asset-backed securities — 8,698 — 8,698 Equity securities: Common stock 280,263 — — 280,263 Non-redeemable preferred stock — 24,668 — 24,668 Private equity funds — 0 10,431 10,431 Short-term investments: Short-term bonds 69,991 9,850 — 79,841 Money market instruments 105,436 0 — 105,436 Total assets at fair value $ 478,197 $ 2,892,014 $ 10,431 $ 3,380,642 Liabilities Notes payable: Secured Notes $ — $ 140,000 $ — $ 140,000 Unsecured Notes — 150,000 — 150,000 Other liabilities: Total return swaps — 11,525 — 11,525 Options sold 260 — — 260 Total liabilities at fair value $ 260 $ 301,525 $ — $ 301,785 December 31, 2014 Level 1 Level 2 Level 3 Total (Amounts in thousands) Assets Fixed maturity securities: U.S. government bonds and agencies $ 16,108 $ — $ — $ 16,108 Municipal securities — 2,275,455 — 2,275,455 Mortgage-backed securities — 47,691 — 47,691 Corporate securities — 256,930 — 256,930 Collateralized debt obligations — 22,216 — 22,216 Equity securities: Common stock: 372,598 — — 372,598 Non-redeemable preferred stock — 28,563 — 28,563 Private equity funds — — 11,719 11,719 Short-term investments: Short-term bonds 69,999 18,362 — 88,361 Money market instruments 284,181 — — 284,181 Total assets at fair value $ 742,886 $ 2,649,217 $ 11,719 $ 3,403,822 Liabilities Notes payable: Secured Notes $ — $ 140,000 $ — $ 140,000 Unsecured Notes — 150,000 — 150,000 Other liabilities: Total return swaps — 4,025 — 4,025 Options sold 194 — — 194 Total liabilities at fair value $ 194 $ 294,025 $ — $ 294,219 |
Summary Of Changes In Fair Value Of Level 3 Financial Assets And Financial Liabilities Held At Fair Value | The following table presents a summary of changes in fair value of Level 3 financial assets and financial liabilities: Year Ended December 31, 2015 2014 Collateralized Debt Obligations Partnership Interest in a Private Credit Fund Collateralized Debt Obligations Partnership Interest in a Private Credit Fund (Amounts in thousands) Beginning Balance $ — $ 11,719 $ 4,302 $ 12,548 Realized losses included in earnings — (4,175 ) (755 ) (829 ) Reclassification from other assets — 2,911 — — Sales — — (3,547 ) — Settlements — (24 ) — — Ending Balance $ — $ 10,431 $ — $ 11,719 The amount of total losses for the period included in earnings attributable to assets still held at December 31 $ — $ (5,385 ) $ — $ (829 ) |
Fixed Assets (Tables)
Fixed Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property, Plant and Equipment [Abstract] | |
Schedule Of Fixed Assets | : December 31, 2015 2014 (Amounts in thousands) Land $ 26,770 $ 26,770 Buildings and improvements 132,529 131,174 Furniture and equipment 109,802 107,288 Capitalized software 178,113 162,065 Leasehold improvements 9,109 8,991 456,323 436,288 Less accumulated depreciation and amortization (299,192 ) (277,312 ) Fixed assets, net $ 157,131 $ 158,976 |
Deferred Policy Acquisition C36
Deferred Policy Acquisition Costs (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Deferred Policy Acquisition Costs Disclosures [Abstract] | |
Schedule Of Deferred Policy Acquisition Costs | Deferred policy acquisition costs were as follows: December 31, 2015 2014 2013 (Amounts in thousands) Balance, beginning of year $ 197,202 $ 194,466 $ 185,910 Policy acquisition costs deferred 543,791 528,944 514,073 Amortization (539,231 ) (526,208 ) (505,517 ) Balance, end of year $ 201,762 $ 197,202 $ 194,466 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Notes Payable [Abstract] | |
Schedule of Long-term Debt Instruments | Notes payable consists of the following: December 31, Lender Interest Rate Expiration 2015 2014 (Amounts in thousands) Secured credit facility Bank of America LIBOR plus 40 basis points December 3, 2017 $ 120,000 $ 120,000 Secured loan Union Bank LIBOR plus 40 basis points December 3, 2017 20,000 20,000 Unsecured credit facility Bank of America and Union Bank (1) December 3, 2019 150,000 150,000 Total $ 290,000 $ 290,000 __________ (1) On July 2, 2013, the Company entered into an unsecured $200 million five -year revolving credit facility. The interest rate on borrowings under the credit facility is based on the Company's debt to total capital ratio and ranges from LIBOR plus 112.5 basis points when the ratio is under 15% to LIBOR plus 162.5 basis points when the ratio is above 25% . Commitment fees for the undrawn portions of the credit facility range from 12.5 basis points when the ratio is under 15% to 22.5 basis points when the ratio is above 25% . Debt to capital ratio is expressed as a percentage of (i) consolidated debt to (ii) consolidated shareholders' equity plus consolidated debt. Effective December 3, 2014, the Company extended the maturity date of the unsecured credit facility from June 30, 2018 to December 3, 2019, and expanded the borrowing capacity from $200 million to $250 million . In 2015 and 2014, the interest rate was LIBOR plus 112.5 basis points on the $150 million of borrowings and 12.5 basis points on the undrawn portion of the credit facility. The interest rate was approximately 1.53% at December 31, 2015. |
Schedule of Maturities of Long-term Debt | The aggregated maturities of notes payable are as follows: Maturity (Amounts in thousands) 2016 $ — 2017 $ 140,000 2018 $ — 2019 $ 150,000 |
Derivative Financial Instrume38
Derivative Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
General Discussion of Derivative Instruments and Hedging Activities [Abstract] | |
Summary Of Location And Amounts Of Derivative Fair Values In The Consolidated Balance Sheets | The following tables present the location and amounts of derivative fair values in the consolidated balance sheets and derivative (losses) gains in the consolidated statements of operations: Asset Derivatives Liability Derivatives December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 (Amounts in thousands) Total return swaps - Other assets $ — $ — $ — $ — Options sold - Other liabilities — — 260 194 Total return swaps - Other liabilities — — 11,525 4,025 Total derivatives $ — $ — $ 11,785 $ 4,219 |
Schedule Of Derivative Gains And Losses In The Consolidated Statements Of Operations | (Losses) Gains Recognized in Income Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Total return swaps - Net realized investment (losses) gains $ (6,438 ) $ (2,969 ) $ 2,176 Options sold - Net realized investment gains 3,081 3,419 1,776 Interest rate contract - Other revenue — — 103 Total $ (3,357 ) $ 450 $ 4,055 |
Other Intangible Assets (Tables
Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule Of Components Of Other Intangible Assets | The following table presents the components of other intangible assets: Gross Carrying Amount Accumulated Amortization Net Carrying Amount Useful Lives (Amounts in thousands) (in years) As of December 31, 2015: Customer relationships $ 52,430 $ (34,327 ) $ 18,103 11 Trade names 15,400 (4,491 ) 10,909 24 Technology 4,300 (3,010 ) 1,290 10 Insurance license 1,400 — 1,400 Indefinite Total intangible assets, net $ 73,530 $ (41,828 ) $ 31,702 As of December 31, 2014: Customer relationships $ 51,755 $ (29,402 ) $ 22,353 11 Trade names 15,400 (3,850 ) 11,550 24 Technology 4,300 (2,580 ) 1,720 10 Total intangible assets, net $ 71,455 $ (35,832 ) $ 35,623 |
Schedule Of Estimated Future Amortization Expense Related To Intangible Assets | The following table presents the estimated future amortization expense related to other intangible assets as of December 31, 2015 : Year Ending December 31, Amortization Expense (Amounts in thousands) 2016 $ 6,077 2017 5,349 2018 5,335 2019 4,906 2020 758 Thereafter 7,877 Total $ 30,302 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |
Components Of Income Tax Expense | The income tax (benefit) expense consisted of the following components: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Federal Current $ 21,942 $ 44,469 $ 30,266 Deferred (25,594 ) 20,444 (14,970 ) $ (3,652 ) $ 64,913 $ 15,296 State Current $ 943 $ 4,421 $ 5,234 Deferred (1,203 ) 142 (577 ) $ (260 ) $ 4,563 $ 4,657 Total Current $ 22,885 $ 48,890 $ 35,500 Deferred (26,797 ) 20,586 (15,547 ) Total $ (3,912 ) $ 69,476 $ 19,953 |
Reconciliation Of Income Taxes | The income tax (benefit) expense reflected in the consolidated statements of operations is reconciled to the federal income tax (benefit) expense on income before income taxes based on a statutory rate of 35% as shown in the table below: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Computed tax expense at 35% $ 24,699 $ 86,598 $ 46,234 Tax-exempt interest income (26,993 ) (27,839 ) (26,381 ) Dividends received deduction (1,613 ) (2,027 ) (2,239 ) State tax expense (287 ) 3,872 4,944 Nondeductible expenses 575 9,900 190 Other, net (293 ) (1,028 ) (2,795 ) Income tax (benefit) expense $ (3,912 ) $ 69,476 $ 19,953 |
Deferred Tax Assets And Liabilities | ignificant components of the Company’s net deferred tax assets and liabilities: December 31, 2015 2014 (Amounts in thousands) Deferred tax assets: 20% of net unearned premium $ 75,406 $ 71,907 Discounting of loss reserves and salvage and subrogation recoverable for tax purposes 9,518 11,100 Write-down of impaired investments 857 942 Tax credit carryforward 36,349 31,198 Expense accruals 11,264 13,395 Other deferred tax assets 9,596 7,448 Total gross deferred tax assets 142,990 135,990 Deferred tax liabilities: Deferred acquisition costs (70,617 ) (69,021 ) Tax liability on net unrealized gain on securities carried at fair value (23,095 ) (47,333 ) Tax depreciation in excess of book depreciation (10,742 ) (9,414 ) Undistributed earnings of insurance subsidiaries (4,022 ) (4,486 ) Tax amortization in excess of book amortization (2,514 ) (1,982 ) Other deferred tax liabilities (8,769 ) (9,087 ) Total gross deferred tax liabilities (119,759 ) (141,323 ) Net deferred tax assets (liabilities) $ 23,231 $ (5,333 ) |
Summary Of Unrecognized Tax Benefits | reconciliation of the beginning and ending balances of unrecognized tax benefits: December 31, 2015 2014 (Amounts in thousands) Balance at January 1 $ 12,612 $ 10,784 Additions based on tax positions related to: Current year 932 2,277 Prior years (1,379 ) (258 ) Additions (reductions) as a result of lapse of the applicable statute of limitations — (191 ) Balance at December 31 $ 12,165 $ 12,612 |
Losses And Loss Adjustment Ex41
Losses And Loss Adjustment Expenses (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Insurance Loss Reserves [Abstract] | |
Activity In The Reserves For Losses And Loss Adjustment Expenses | ctivity in the reserves for losses and loss adjustment expenses: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Gross reserves at January 1 $ 1,091,797 $ 1,038,984 $ 1,036,123 Less reinsurance recoverable (14,484 ) (13,927 ) (12,155 ) Net reserves at January 1 1,077,313 1,025,057 1,023,968 Acquisition of WAIC reserves 18,676 — — Incurred losses and loss adjustment expenses related to: Current year 2,132,837 1,989,315 1,959,730 Prior years 12,658 (3,193 ) 2,960 Total incurred losses and loss adjustment expenses 2,145,495 1,986,122 1,962,690 Loss and loss adjustment expense payments related to: Current year 1,455,245 1,347,967 1,354,074 Prior years 654,097 585,899 607,527 Total payments 2,109,342 1,933,866 1,961,601 Net reserves at December 31 1,132,142 1,077,313 1,025,057 Reinsurance recoverable 14,546 14,484 13,927 Gross reserves at December 31 $ 1,146,688 $ 1,091,797 $ 1,038,984 |
Dividends (Tables)
Dividends (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Dividends [Abstract] | |
Dividends Paid In Total And Per Share | The following table presents shareholder dividends paid: Year Ended December 31, 2015 2014 2013 (Amounts in thousands, except per share data) Total paid $ 136,386 $ 135,496 $ 134,776 Per share paid $ 2.4725 $ 2.4625 $ 2.4525 |
Statutory Balances and Accoun43
Statutory Balances and Accounting Practices (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Statutory Balances And Accounting Practices [Abstract] | |
Schedule Of Statutory Net Income And Capital And Surplus | The following table presents the statutory net income, and statutory capital and surplus of the Insurance Companies, as reported to regulatory authorities: Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Statutory net income (1) $ 123,984 $ 155,654 $ 235,251 Statutory capital and surplus $ 1,451,950 $ 1,438,281 $ 1,528,682 __________ (1) Statutory net income reflects differences from GAAP net income, including changes in the fair value of the investment portfolio as a result of the application of the fair value option. |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Schedule of Cash Proceeds Received from Share-based Payment Awards | Year Ended December 31, 2015 2014 2013 (Amounts in thousands) Cash received from stock option exercises $ 2,111 $ 6,247 $ 1,446 Compensation cost 5,208 4,112 974 Excess tax benefit 27 148 202 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following table provides the assumptions used in the calculation of grant-date fair values of stock options awarded during 2013 based on the Black-Scholes option pricing model. 2013 Weighted-average grant-date fair value $7.11 Expected volatility 33.16% - 33.18% Weighted-average expected volatility 33.17% Risk-free interest rate 0.88% - 1.60% Expected dividend yield 5.40% - 5.76% Expected term in months 72 |
Summary of Stock Option Activity | The following table presents a summary of the stock option activity under the Company’s plans for the year ended December 31, 2015 : Shares Weighted- Average Exercise Price Weighted- Average Remaining Contractual Term (Years) Aggregate Intrinsic Value (in 000’s) Outstanding at January 1, 2015 248,000 $ 49.85 Granted — Exercised (43,000) $ 49.10 Canceled or expired (37,000) $ 58.48 Outstanding at December 31, 2015 168,000 $ 48.14 3.8 $ 305 Exercisable at December 31, 2015 128,000 $ 49.58 2.7 $ 183 |
Schedule of Options Authorized under Stock Option Plans, by Exercise Price Range | The following table presents information regarding stock options outstanding at December 31, 2015 : Options Outstanding Options Exercisable Range of Exercise Prices Number of Options Weighted-Average Remaining Contractual Life (Years) Weighted- Average Exercise Price Number of Options Weighted- Average Exercise Price $33.61-$47.61 88,000 6.1 $ 43.29 48,000 $ 43.09 $50.01-$51.51 38,000 2.0 $ 50.72 38,000 $ 50.72 $54.93-$57.50 42,000 0.8 $ 55.96 42,000 $ 55.96 |
Summary of Grants | The following table presents the restricted stock unit grants summary at December 31, 2015 : Grant Year 2015 2014 2013 Three-year performance period ending December 31, 2017 2016 2015 Vesting shares, target (net of forfeited) 99,250 85,500 78,500 Vesting shares, maximum (net of forfeited) 186,094 160,313 176,625 |
Summary of Vested And Unvested RSU | The following table presents a summary of restricted stock unit awards activity during the years indicated: Year Ended December 31, 2015 2014 2013 Shares Weighted- Average Fair Value per Share Shares Weighted- Average Fair Value per Share Shares Weighted- Average Fair Value per Share Outstanding at January 1 167,000 $ 41.15 170,500 $ 39.64 169,000 $ 42.22 Granted 100,250 $ 53.80 93,500 $ 45.17 84,500 $ 36.82 Vested — — — Forfeited/Canceled (4,000) $ 43.10 (16,500) $ 43.99 (3,000) $ 36.82 Expired — $ — (80,500) $ 44.01 (80,000) $ 40.22 Outstanding at December 31 263,250 $ 45.94 167,000 $ 41.15 170,500 $ 39.64 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share Reconciliation [Abstract] | |
Reconciliation Of Numerators And Denominators Of Basic And Diluted Earnings Per Share | The following table presents a reconciliation of the numerators and denominators of the basic and diluted earnings per share calculations: Year Ended December 31, 2015 2014 2013 Income (Numerator) Weighted Shares (Denominator) Per-Share Amount Income (Numerator) Weighted Shares (Denominator) Per-Share Amount Income (Numerator) Weighted Shares (Denominator) Per-Share Amount (Amounts and numbers in thousands, except per-share data) Basic EPS Income available to common stockholders $ 74,479 55,157 $ 1.35 $ 177,949 55,008 $ 3.23 $ 112,143 54,947 $ 2.04 Effect of dilutive securities: Options — 15 — 12 — 17 RSUs — 37 — — — — Diluted EPS Income available to common stockholders after assumed conversions $ 74,479 55,209 $ 1.35 $ 177,949 55,020 $ 3.23 $ 112,143 54,964 $ 2.04 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
Future Minimum Commitments For Operating Leases | The following table presents future minimum commitments for operating leases as of December 31, 2015 : Year Ending December 31, Operating Leases (Amounts in thousands) 2016 $ 14,765 2017 11,008 2018 4,684 2019 1,006 2020 463 Thereafter 64 |
Quarterly Financial Informati47
Quarterly Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Data [Abstract] | |
Summary Of Quarterly Financial Data | ummarized quarterly financial data for 2015 and 2014 : Quarter Ended March 31 June 30 September 30 December 31 (Amounts in thousands, except per share data) 2015 Net premiums earned $ 720,737 $ 731,546 $ 745,520 $ 760,094 Change in fair value of investments pursuant to the fair value option $ (4,884 ) $ (40,783 ) $ (18,538 ) $ 2,474 Income before income taxes $ 29,859 $ 4,511 $ 12,267 $ 23,930 Net income $ 26,165 $ 9,639 $ 15,270 $ 23,405 Basic earnings per share (2) $ 0.47 $ 0.17 $ 0.28 $ 0.42 Diluted earnings per share (2) $ 0.47 $ 0.17 $ 0.28 $ 0.42 Dividends paid per share $ 0.6175 $ 0.6175 $ 0.6175 $ 0.6200 2014 Net premiums earned $ 683,701 $ 697,889 $ 705,237 $ 709,368 Change in fair value of investments pursuant to the fair value option $ 45,699 $ 41,412 $ (20,528 ) $ (22,824 ) Income (loss) before income taxes $ 102,030 $ 136,436 $ 37,120 $ (28,161 ) Net income (loss) $ 72,649 $ 94,960 $ 31,296 $ (20,956 ) Basic earnings per share $ 1.32 $ 1.73 $ 0.57 $ (0.38 ) Diluted earnings per share $ 1.32 $ 1.73 $ 0.57 $ (0.38 ) (1) Dividends paid per share $ 0.6150 $ 0.6150 $ 0.6175 $ 0.6175 __________ (1) The dilutive impact of incremental shares is excluded from net loss position in accordance with GAAP. (2) The basic and diluted earnings per share do not sum due to rounding. |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Reconciliation of operating results by reportable segment | The following table presents operating results by reportable segment for the years ended: December 31, 2015 December 31, 2014 December 31, 2013 Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total (Amounts in millions) Net premiums earned $ 2,906.6 $ 51.3 $ 2,957.9 $ 2,737.3 $ 58.9 $ 2,796.2 $ 2,638.4 $ 59.8 $ 2,698.2 Less: Incurred expenses 2,117.3 28.2 2,145.5 1,951.4 34.7 1,986.1 1,926.4 36.3 1,962.7 Underwriting expenses 770.0 20.0 790.0 749.7 25.9 775.6 701.0 23.9 724.9 Underwriting gain 19.3 3.1 22.4 36.2 (1.7 ) 34.5 11.0 (0.4 ) 10.6 Investment income 126.3 125.7 124.5 Net realized investment (losses) gains (83.8 ) 81.1 (11.4 ) Other income 8.9 8.7 9.7 Interest expense (3.2 ) (2.6 ) (1.3 ) Pre-tax income $ 70.6 $ 247.4 $ 132.1 Net income $ 74.5 $ 177.9 $ 112.1 |
Schedule direct premiums attributable to segment | The following table presents the Company’s direct premiums written and net premiums earned by line of insurance business for the years ended: December 31, 2015 December 31, 2014 December 31, 2013 Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total Property & Casualty Lines Other (1) Total (Amounts in millions) Private passenger automobile $ 2,345.8 $ — $ 2,345.8 $ 2,223.1 $ — $ 2,223.1 $ 2,165.6 $ — $ 2,165.6 Homeowners 402.2 — 402.2 374.5 — 374.5 340.0 — 340.0 Commercial automobile 153.5 — 153.5 135.9 — 135.9 104.7 — 104.7 Other 81.6 29.8 111.4 75.4 44.3 119.7 64.4 62.8 127.2 Direct premiums written $ 2,983.1 $ 29.8 $ 3,012.9 $ 2,808.9 $ 44.3 2,853.2 $ 2,674.7 $ 62.8 $ 2,737.5 Private passenger automobile $ 2,308.6 $ — $ 2,308.6 $ 2,203.0 $ — $ 2,203.0 $ 2,163.4 $ — $ 2,163.4 Homeowners 379.7 — 379.7 347.9 — 347.9 328.5 — 328.5 Commercial automobile 144.4 — 144.4 121.8 — 121.8 88.3 — 88.3 Other 73.9 51.3 125.2 64.6 58.9 123.5 58.2 59.8 118.0 Net premiums earned $ 2,906.6 $ 51.3 $ 2,957.9 $ 2,737.3 $ 58.9 $ 2,796.2 $ 2,638.4 $ 59.8 $ 2,698.2 __________ (1) "Other" represents net premiums written and earned from an operating segment that does not meet the quantitative thresholds required to be considered a reportable segment. This operating segment offers automobile mechanical breakdown warranties which are sold through auto dealerships and credit unions. |
Summary of Significant Accoun49
Summary of Significant Accounting Policies (Narrative) (Details) | 12 Months Ended | ||
Dec. 31, 2015USD ($)StateSubsidiary | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Summary Of Significant Accounting Policies [Line Items] | |||
Number of insurance companies | Subsidiary | 14 | ||
Number of states in which company operates | State | 13 | ||
Percentage of direct premiums written as private passenger automobile lines of insurance | 77.00% | ||
Percentage of private passenger automobile premiums written in California | 83.00% | 83.00% | 81.00% |
Percentage by which dividend income on non redeemable preferred stock, partnership, common stock is partially tax-sheltered | 70.00% | ||
Insurance companies security deposits | $ 21,000,000 | $ 18,000,000 | |
Deferred policy acquisition cost amortization | 539,231,000 | 526,208,000 | $ 505,517,000 |
Advertising expenses | 44,000,000 | 23,000,000 | 20,000,000 |
Impairment charges | 0 | 0 | 0 |
Goodwill impairment loss | 0 | 0 | |
Premiums written, net | $ 3,000,000,000 | $ 2,840,000,000 | $ 2,730,000,000 |
Options Granted Subsequent To January 1, 2008 [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Option vesting term, years | 4 years | ||
Minimum [Member] | Options Granted Prior To 2008 [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Option vesting term, years | 4 years | ||
Maximum [Member] | Options Granted Prior To 2008 [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Option vesting term, years | 5 years | ||
Building [Member] | Minimum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life, in years | 30 years | ||
Building [Member] | Maximum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life, in years | 40 years | ||
Furniture Equipment And Purchase Software [Member] | Minimum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life, in years | 3 years | ||
Furniture Equipment And Purchase Software [Member] | Maximum [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life, in years | 7 years | ||
Software [Member] | |||
Summary Of Significant Accounting Policies [Line Items] | |||
Useful life, in years | 7 years |
Fair Value of Financial Instr50
Fair Value of Financial Instruments (Narrative) (Details) - USD ($) | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Other liabilities | $ 199,187,000 | $ 207,028,000 |
Secured loan | 20,000,000 | 20,000,000 |
Liabilities fair value | 301,785,000 | 294,219,000 |
Unsecured Debt [Member] | Borrowings [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Liabilities fair value | 150,000,000 | 150,000,000 |
Level 2 [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Liabilities fair value | 301,525,000 | 294,025,000 |
Level 2 [Member] | Unsecured Debt [Member] | Borrowings [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Liabilities fair value | 150,000,000 | 150,000,000 |
Level 2 [Member] | Secured Notes One [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Secured loan | 120,000,000 | |
Level 2 [Member] | Secured Notes Two [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Secured loan | 20,000,000 | |
Call Option [Member] | ||
Fair Value, Off-balance Sheet Risks, Disclosure Information [Line Items] | ||
Other liabilities | $ 300,000 | $ 200,000 |
Fair Value of Financial Instr51
Fair Value of Financial Instruments (Estimated Fair Values Of Financial Instruments) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Assets | ||
Investments | $ 2,880,003 | |
Liabilities | ||
Options sold | 11,785 | $ 4,219 |
Liabilities fair value | 301,785 | 294,219 |
Level 2 [Member] | ||
Liabilities | ||
Liabilities fair value | 301,525 | 294,025 |
Secured Debt [Member] | Borrowings [Member] | ||
Liabilities | ||
Liabilities fair value | 140,000 | 140,000 |
Secured Debt [Member] | Borrowings [Member] | Level 2 [Member] | ||
Liabilities | ||
Liabilities fair value | 140,000 | 140,000 |
Unsecured Debt [Member] | Borrowings [Member] | ||
Liabilities | ||
Liabilities fair value | 150,000 | 150,000 |
Unsecured Debt [Member] | Borrowings [Member] | Level 2 [Member] | ||
Liabilities | ||
Liabilities fair value | 150,000 | 150,000 |
Equity Contract [Member] | ||
Liabilities | ||
Equity contracts | 11,525 | 4,025 |
Investments [Member] | ||
Assets | ||
Investments | 3,380,642 | 3,403,822 |
Secured Debt [Member] | Secured Debt [Member] | Borrowings [Member] | Level 2 [Member] | ||
Liabilities | ||
Liabilities fair value | 140,000 | |
Other liabilities [Member] | Not Designated as Hedging Instrument [Member] | Equity Contract [Member] | ||
Liabilities | ||
Options sold | $ 260 | $ 194 |
Investments (Gains And Losses D
Investments (Gains And Losses Due To Changes In Fair Value Of Investments) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | |||||||||||
Gains and losses due to changes in fair value of investments | $ 2,474 | $ (18,538) | $ (40,783) | $ (4,884) | $ (22,824) | $ (20,528) | $ 41,412 | $ 45,699 | $ (61,731) | $ 43,759 | $ (44,037) |
Fixed Maturity Securities [Member] | |||||||||||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | |||||||||||
Gains and losses due to changes in fair value of investments | (39,304) | 77,208 | (100,703) | ||||||||
Equity Securities [Member] | |||||||||||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | |||||||||||
Gains and losses due to changes in fair value of investments | (22,988) | (32,922) | 56,822 | ||||||||
Short-term Investments [Member] | |||||||||||
Schedule of Fair Value of Separate Accounts by Major Category of Investment [Line Items] | |||||||||||
Gains and losses due to changes in fair value of investments | $ 561 | $ (527) | $ (156) |
Investments (Gross Gains And Lo
Investments (Gross Gains And Losses Realized On Sales Of Investments) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Fixed Maturity Securities [Member] | |||
Investments [Line Items] | |||
Gross Realized Gains | $ 631 | $ 7,015 | $ 9,320 |
Gross Realized Losses | (495) | (9,734) | (3,842) |
Net | 136 | (2,719) | 5,478 |
Equity Securities [Member] | |||
Investments [Line Items] | |||
Gross Realized Gains | 41,305 | 59,342 | 82,385 |
Gross Realized Losses | (58,764) | (17,705) | (58,297) |
Net | (17,459) | 41,637 | 24,088 |
Short-term Investments [Member] | |||
Investments [Line Items] | |||
Gross Realized Gains | 0 | 0 | 0 |
Gross Realized Losses | (1,396) | (1,943) | (903) |
Net | $ (1,396) | $ (1,943) | $ (903) |
Investments (Estimated Fair Val
Investments (Estimated Fair Value Of Investments) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Fixed maturity securities: | |
Due in one year or less | $ 108,775 |
Due after one year through five years | 394,240 |
Due after five years through ten years | 609,243 |
Due after ten years | 1,767,745 |
Total | $ 2,880,003 |
Percentage of fixed maturities | 1.30% |
Investments (Investment Income)
Investments (Investment Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Investments [Line Items] | |||
Total investment income | $ 131,785 | $ 130,820 | $ 128,877 |
Less: Investment expense | (5,486) | (5,097) | (4,339) |
Net investment income | 126,299 | 125,723 | 124,538 |
Fixed Maturity Securities [Member] | |||
Investments [Line Items] | |||
Total investment income | 108,122 | 104,946 | 107,926 |
Equity Securities [Member] | |||
Investments [Line Items] | |||
Total investment income | 14,630 | 17,313 | 18,249 |
Short-term Investments [Member] | |||
Investments [Line Items] | |||
Total investment income | $ 9,033 | $ 8,561 | $ 2,702 |
Fair Value Measurement (Narrati
Fair Value Measurement (Narrative) (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015USD ($)broker | Dec. 31, 2014USD ($) | |
Fair Value Measurement [Line Items] | ||
Percentage of portfolio of unadjusted fair values obtained | 99.70% | |
Percentage of portfolio of specific unadjusted broker quotes obtained | 0.30% | |
Fair value of assets measured on a recurring basis | $ 3,380,642 | $ 3,403,822 |
Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 10,431 | 11,719 |
Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 2,892,014 | 2,649,217 |
Level 2 [Member] | Commercial Mortgage Backed Securities [Member] | ||
Fair Value Measurement [Line Items] | ||
Trading securities, fair value disclosure | $ 37,300 | $ 32,500 |
Minimum [Member] | ||
Fair Value Measurement [Line Items] | ||
Number of knowledgeable outside security brokers consulted to determine fair value | broker | 1 |
Fair Value Measurement (Schedul
Fair Value Measurement (Schedule Of Assets And Liabilities Measured At Fair Value On A Recurring Basis Valuation Techniques) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | $ 3,380,642 | $ 3,403,822 |
Fair value of liabilities measured on a recurring basis | 301,785 | 294,219 |
Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 478,197 | 742,886 |
Fair value of liabilities measured on a recurring basis | 260 | 194 |
Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 2,892,014 | 2,649,217 |
Fair value of liabilities measured on a recurring basis | 301,525 | 294,025 |
Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 10,431 | 11,719 |
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | US Treasury and Government [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 22,507 | 16,108 |
Fixed Maturity Securities [Member] | US Treasury and Government [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 22,507 | 16,108 |
Fixed Maturity Securities [Member] | US Treasury and Government [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | US Treasury and Government [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | US States and Political Subdivisions Debt Securities [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 2,505,040 | 2,275,455 |
Fixed Maturity Securities [Member] | US States and Political Subdivisions Debt Securities [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | US States and Political Subdivisions Debt Securities [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 2,505,040 | 2,275,455 |
Fixed Maturity Securities [Member] | US States and Political Subdivisions Debt Securities [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Collateralized Mortgage Backed Securities [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 49,838 | 47,691 |
Fixed Maturity Securities [Member] | Collateralized Mortgage Backed Securities [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Collateralized Mortgage Backed Securities [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 49,838 | 47,691 |
Fixed Maturity Securities [Member] | Collateralized Mortgage Backed Securities [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Corporate Debt Securities [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 243,372 | 256,930 |
Fixed Maturity Securities [Member] | Corporate Debt Securities [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Corporate Debt Securities [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 243,372 | 256,930 |
Fixed Maturity Securities [Member] | Corporate Debt Securities [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Collateralized Debt Obligations [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 50,548 | 22,216 |
Fixed Maturity Securities [Member] | Collateralized Debt Obligations [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Collateralized Debt Obligations [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 50,548 | 22,216 |
Fixed Maturity Securities [Member] | Collateralized Debt Obligations [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Fixed Maturity Securities [Member] | Collateralized Auto Loans [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 8,698 | |
Fixed Maturity Securities [Member] | Collateralized Auto Loans [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | |
Fixed Maturity Securities [Member] | Collateralized Auto Loans [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 8,698 | |
Fixed Maturity Securities [Member] | Collateralized Auto Loans [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | |
Equity Securities [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 280,263 | 372,598 |
Equity Securities [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 280,263 | 372,598 |
Equity Securities [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Nonredeemable Preferred Stock [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 24,668 | 28,563 |
Equity Securities [Member] | Nonredeemable Preferred Stock [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Nonredeemable Preferred Stock [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 24,668 | 28,563 |
Equity Securities [Member] | Nonredeemable Preferred Stock [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Private Equity Funds [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 10,431 | 11,719 |
Equity Securities [Member] | Private Equity Funds [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Private Equity Funds [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Equity Securities [Member] | Private Equity Funds [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 10,431 | 11,719 |
Short-term Investments [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 79,841 | 88,361 |
Short-term Investments [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 69,991 | 69,999 |
Short-term Investments [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 9,850 | 18,362 |
Short-term Investments [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Money Market Funds [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 105,436 | 284,181 |
Money Market Funds [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 105,436 | 284,181 |
Money Market Funds [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Money Market Funds [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of assets measured on a recurring basis | 0 | 0 |
Total Return Swap [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 11,525 | 4,025 |
Total Return Swap [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Total Return Swap [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 11,525 | 4,025 |
Total Return Swap [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Equity Contract [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 260 | 194 |
Equity Contract [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 260 | 194 |
Equity Contract [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Equity Contract [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Secured Debt [Member] | Borrowings [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 140,000 | 140,000 |
Secured Debt [Member] | Borrowings [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Secured Debt [Member] | Borrowings [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 140,000 | 140,000 |
Secured Debt [Member] | Borrowings [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Unsecured Debt [Member] | Borrowings [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 150,000 | 150,000 |
Unsecured Debt [Member] | Borrowings [Member] | Level 1 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 0 | 0 |
Unsecured Debt [Member] | Borrowings [Member] | Level 2 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | 150,000 | 150,000 |
Unsecured Debt [Member] | Borrowings [Member] | Level 3 [Member] | ||
Fair Value Measurement [Line Items] | ||
Fair value of liabilities measured on a recurring basis | $ 0 | $ 0 |
Fair Value Measurement (Summary
Fair Value Measurement (Summary Of Changes In Fair Value Of Level 3 Financial Assets And Financial Liabilities Held At Fair Value) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Collateralized Debt Obligations [Member] | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning Balance | $ 0 | $ 4,302 |
Realized losses included in earnings | 0 | (755) |
Reclassification from other assets | 0 | 0 |
Sales | 0 | (3,547) |
Settlements | 0 | 0 |
Ending Balance | 0 | 0 |
The amount of total losses for the period included in earnings attributable to assets still held at December 31 | 0 | 0 |
Partnership Interest in a Private Credit Fund [Member] | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning Balance | 11,719 | 12,548 |
Realized losses included in earnings | (4,175) | (829) |
Reclassification from other assets | 2,911 | 0 |
Sales | 0 | 0 |
Settlements | (24) | 0 |
Ending Balance | 10,431 | 11,719 |
The amount of total losses for the period included in earnings attributable to assets still held at December 31 | $ (5,385) | $ (829) |
Fixed Assets (Details)
Fixed Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property, Plant and Equipment [Abstract] | |||
Land | $ 26,770 | $ 26,770 | |
Buildings and improvements | 132,529 | 131,174 | |
Furniture and equipment | 109,802 | 107,288 | |
Capitalized software | 178,113 | 162,065 | |
Leasehold improvements | 9,109 | 8,991 | |
Fixed assets, gross | 456,323 | 436,288 | |
Less accumulated depreciation and amortization | (299,192) | (277,312) | |
Fixed assets, net | 157,131 | 158,976 | |
Depreciation expense | $ 20,500 | $ 22,100 | $ 24,600 |
Deferred Policy Acquisition C60
Deferred Policy Acquisition Costs (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Movement Analysis of Deferred Policy Acquisition Costs [Roll Forward] | |||
Balance, beginning of year | $ 197,202 | $ 194,466 | $ 185,910 |
Policy acquisition costs deferred | 543,791 | 528,944 | 514,073 |
Amortization | (539,231) | (526,208) | (505,517) |
Balance, end of year | $ 201,762 | $ 197,202 | $ 194,466 |
Notes Payable (Narrative) (Deta
Notes Payable (Narrative) (Details) | Jul. 02, 2013USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 03, 2014USD ($) | |
Debt Instrument [Line Items] | |||||
Loan maximum borrowing capacity | $ 200,000,000 | ||||
Revolving credit facility term | 5 years | ||||
Unsecured credit facility | [1] | $ 150,000,000 | $ 150,000,000 | ||
Secured debt, other | $ 120,000,000 | $ 120,000,000 | |||
Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Advance rate used to calculate collateral requirement | 75.00% | ||||
Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Advance rate used to calculate collateral requirement | 100.00% | ||||
Bank Of America [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 0.40% | ||||
Secured debt, other | $ 20,000,000 | ||||
Union Bank [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 0.40% | ||||
AIS [Member] | |||||
Debt Instrument [Line Items] | |||||
Secured debt, other | $ 120,000,000 | ||||
Revolving Credit Facility [Member] | |||||
Debt Instrument [Line Items] | |||||
Loan maximum borrowing capacity | $ 200,000,000 | $ 250,000,000 | |||
Revolving credit facility term | 5 years | ||||
Commitment fee on undrawn portion of facility | 0.125% | ||||
Unsecured credit facility | $ 150,000,000 | ||||
Interest rate at period end | 1.53% | ||||
Revolving Credit Facility [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt to total capital ratio | 0.15 | ||||
Commitment fee on undrawn portion of facility | 0.125% | ||||
Revolving Credit Facility [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Debt to total capital ratio | 0.25 | ||||
Commitment fee on undrawn portion of facility | 0.225% | ||||
Revolving Credit Facility [Member] | LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.125% | ||||
Revolving Credit Facility [Member] | LIBOR [Member] | Minimum [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.125% | ||||
Debt to total capital ratio | 0.15 | ||||
Revolving Credit Facility [Member] | LIBOR [Member] | Maximum [Member] | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate | 1.625% | ||||
Debt to total capital ratio | 0.25 | ||||
[1] | On July 2, 2013, the Company entered into an unsecured $200 million five-year revolving credit facility. The interest rate on borrowings under the credit facility is based on the Company's debt to total capital ratio and ranges from LIBOR plus 112.5 basis points when the ratio is under 15% to LIBOR plus 162.5 basis points when the ratio is above 25%. Commitment fees for the undrawn portions of the credit facility range from 12.5 basis points when the ratio is under 15% to 22.5 basis points when the ratio is above 25%. Debt to capital ratio is expressed as a percentage of (i) consolidated debt to (ii) consolidated shareholders' equity plus consolidated debt. Effective December 3, 2014, the Company extended the maturity date of the unsecured credit facility from June 30, 2018 to December 3, 2019, and expanded the borrowing capacity from $200 million to $250 million. In 2015 and 2014, the interest rate was LIBOR plus 112.5 basis points on the $150 million of borrowings and 12.5 basis points on the undrawn portion of the credit facility. The interest rate was approximately 1.53% at December 31, 2015. |
Notes Payable (Schedule of Long
Notes Payable (Schedule of Long-term Debt) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | |
Notes Payable [Abstract] | |||
Secured debt, other | $ 120,000 | $ 120,000 | |
Secured loan | 20,000 | 20,000 | |
Unsecured credit facility | [1] | 150,000 | 150,000 |
Notes Payable | $ 290,000 | $ 290,000 | |
[1] | On July 2, 2013, the Company entered into an unsecured $200 million five-year revolving credit facility. The interest rate on borrowings under the credit facility is based on the Company's debt to total capital ratio and ranges from LIBOR plus 112.5 basis points when the ratio is under 15% to LIBOR plus 162.5 basis points when the ratio is above 25%. Commitment fees for the undrawn portions of the credit facility range from 12.5 basis points when the ratio is under 15% to 22.5 basis points when the ratio is above 25%. Debt to capital ratio is expressed as a percentage of (i) consolidated debt to (ii) consolidated shareholders' equity plus consolidated debt. Effective December 3, 2014, the Company extended the maturity date of the unsecured credit facility from June 30, 2018 to December 3, 2019, and expanded the borrowing capacity from $200 million to $250 million. In 2015 and 2014, the interest rate was LIBOR plus 112.5 basis points on the $150 million of borrowings and 12.5 basis points on the undrawn portion of the credit facility. The interest rate was approximately 1.53% at December 31, 2015. |
Notes Payable (Schedule of Matu
Notes Payable (Schedule of Maturities of Debt) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Notes Payable [Abstract] | |
2,016 | $ 0 |
2,017 | 140,000 |
2,018 | 0 |
2,019 | $ 150,000 |
Derivative Financial Instrume64
Derivative Financial Instruments (Narrative) (Details) - Swap [Member] - USD ($) $ in Millions | Feb. 13, 2014 | Aug. 09, 2013 | Dec. 31, 2015 |
AFL [Member] | |||
Derivative Financial Instruments [Line Items] | |||
Notional amount | $ 124 | ||
Swap agreement collateral | 40 | ||
AFL [Member] | LIBOR [Member] | |||
Derivative Financial Instruments [Line Items] | |||
Basis spread on variable rate | 120000.00% | 1.20% | |
FFL [Member] | |||
Derivative Financial Instruments [Line Items] | |||
Notional amount | 95 | ||
Swap agreement collateral | $ 30 | ||
Term of swap agreement | 1 year | 3 years | |
FFL [Member] | LIBOR [Member] | |||
Derivative Financial Instruments [Line Items] | |||
Basis spread on variable rate | 1.40% | 140000.00% |
Derivative Financial Instrume65
Derivative Financial Instruments (Summary Of Location And Amounts Of Derivative Fair Values In The Consolidated Balance Sheets) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Derivative Financial Instruments [Line Items] | ||
Asset Derivatives | $ 0 | $ 0 |
Liability Derivatives | 11,785 | 4,219 |
Not Designated as Hedging Instrument [Member] | Interest rate swap agreements [Member] | Other Assets [Member] | ||
Derivative Financial Instruments [Line Items] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | 0 | 0 |
Not Designated as Hedging Instrument [Member] | Interest rate swap agreements [Member] | Other liabilities [Member] | ||
Derivative Financial Instruments [Line Items] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | 11,525 | 4,025 |
Not Designated as Hedging Instrument [Member] | Equity contracts [Member] | Other liabilities [Member] | ||
Derivative Financial Instruments [Line Items] | ||
Asset Derivatives | 0 | 0 |
Liability Derivatives | $ 260 | $ 194 |
Derivative Financial Instrume66
Derivative Financial Instruments (Schedule Of Derivative Gains And Losses In The Consolidated Statements Of Operations) (Details) - Not Designated as Hedging Instrument [Member] - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Derivative Financial Instruments [Line Items] | |||
(Losses) Gains Recognized in Income | $ (3,357) | $ 450 | $ 4,055 |
Total Return Swap [Member] | Net realized investment gains [Member] | |||
Derivative Financial Instruments [Line Items] | |||
(Losses) Gains Recognized in Income | (6,438) | (2,969) | 2,176 |
Equity contracts [Member] | Net realized investment gains [Member] | |||
Derivative Financial Instruments [Line Items] | |||
(Losses) Gains Recognized in Income | 3,081 | 3,419 | 1,776 |
Interest rate swap agreements [Member] | Other revenue (expense) [Member] | |||
Derivative Financial Instruments [Line Items] | |||
(Losses) Gains Recognized in Income | $ 0 | $ 0 | $ 103 |
Other Intangible Assets (Narrat
Other Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets amortization expense | $ 6 | $ 6 | $ 6 |
Licensing Agreements [Member] | Workmen's Auto Insurance Company [Member] | |||
Acquired Finite-Lived Intangible Assets [Line Items] | |||
Intangible assets acquired | $ 1.4 |
Other Intangible Assets (Schedu
Other Intangible Assets (Schedule Of Components Of Other Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 73,530 | $ 71,455 |
Accumulated Amortization | (41,828) | (35,832) |
Other intangible assets, net | 31,702 | 35,623 |
Favorable leases [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 1,400 | |
Other intangible assets, net | 1,400 | |
Customer relationships [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | 52,430 | 51,755 |
Accumulated Amortization | (34,327) | (29,402) |
Other intangible assets, net | $ 18,103 | $ 22,353 |
Useful Lives (in years) | 11 years | 11 years |
Trade names [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 15,400 | $ 15,400 |
Accumulated Amortization | (4,491) | (3,850) |
Other intangible assets, net | $ 10,909 | $ 11,550 |
Useful Lives (in years) | 24 years | 24 years |
Technology [Member] | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Carrying Amount | $ 4,300 | $ 4,300 |
Accumulated Amortization | (3,010) | (2,580) |
Other intangible assets, net | $ 1,290 | $ 1,720 |
Useful Lives (in years) | 10 years | 10 years |
Other Intangible Assets (Sche69
Other Intangible Assets (Schedule Of Estimated Future Amortization Expense Related To Intangible Assets) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,016 | $ 6,077 |
2,017 | 5,349 |
2,018 | 5,335 |
2,019 | 4,906 |
2,020 | 758 |
Thereafter | 7,877 |
Net Carrying Amount | $ 30,302 |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Federal statutory rate | 35.00% | ||
AMT credit carryforward balance | $ 36,300 | $ 31,200 | |
Net increase of unrecognized tax benefits | 400 | ||
Unrecognized tax benefits | 12,165 | 12,612 | $ 10,784 |
Unrecognized tax benefits that would impact effective tax rate | 10,900 | 11,100 | |
Interest and penalty expense, excluding refunds | 112 | 739 | $ 1,119 |
Accrued interest and penalty | $ 2,915 | $ 2,803 |
Income Taxes (Components Of Inc
Income Taxes (Components Of Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Federal | |||
Current | $ 21,942 | $ 44,469 | $ 30,266 |
Deferred | (25,594) | 20,444 | (14,970) |
Total | (3,652) | 64,913 | 15,296 |
State | |||
Current | 943 | 4,421 | 5,234 |
Deferred | (1,203) | 142 | (577) |
Total | (260) | 4,563 | 4,657 |
Total, Current | 22,885 | 48,890 | 35,500 |
Total, Deferred | (26,797) | 20,586 | (15,547) |
Income tax (benefit) expense | $ (3,912) | $ 69,476 | $ 19,953 |
Income Taxes (Reconciliation Of
Income Taxes (Reconciliation Of Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Components of Income Tax Expense (Benefit), Continuing Operations [Abstract] | |||
Computed tax expense at 35% | $ 24,699 | $ 86,598 | $ 46,234 |
Tax-exempt interest income | (26,993) | (27,839) | (26,381) |
Dividends received deduction | (1,613) | (2,027) | (2,239) |
State tax expense | (287) | 3,872 | 4,944 |
Nondeductible expenses | 575 | 9,900 | 190 |
Other, net | (293) | (1,028) | (2,795) |
Income tax (benefit) expense | $ (3,912) | $ 69,476 | $ 19,953 |
Income Taxes (Deferred Tax Asse
Income Taxes (Deferred Tax Assets And Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
20% of net unearned premium | $ 75,406 | $ 71,907 |
Discounting of loss reserves and salvage and subrogation recoverable for tax purposes | 9,518 | 11,100 |
Write-down of impaired investments | 857 | 942 |
Tax credit carryforward | 36,349 | 31,198 |
Expense accruals | 11,264 | 13,395 |
Other deferred tax assets | 9,596 | 7,448 |
Total gross deferred tax assets | 142,990 | 135,990 |
Deferred tax liabilities: | ||
Deferred acquisition costs | (70,617) | (69,021) |
Tax liability on net unrealized gain on securities carried at fair value | (23,095) | (47,333) |
Tax depreciation in excess of book depreciation | (10,742) | (9,414) |
Undistributed earnings of insurance subsidiaries | (4,022) | (4,486) |
Tax amortization in excess of book amortization | (2,514) | (1,982) |
Other deferred tax liabilities | (8,769) | (9,087) |
Total gross deferred tax liabilities | (119,759) | (141,323) |
Net deferred tax assets | 23,231 | |
Net deferred tax liabilities | $ 0 | $ (5,333) |
Income Taxes (Summary Of Unreco
Income Taxes (Summary Of Unrecognized Tax Benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | ||
Balance at January 1 | $ 12,612 | $ 10,784 |
Additions based on tax positions related to the current year | 932 | 2,277 |
Additions based on tax positions related to prior years | (1,379) | (258) |
Additions (reductions) as a result of lapse of the applicable statute of limitations | 0 | (191) |
Balance at December 31 | $ 12,165 | $ 12,612 |
Losses And Loss Adjustment Ex75
Losses And Loss Adjustment Expenses (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Extraordinary Item [Line Items] | |||
Prior year claims and claim adjustment expense | $ 12,658 | $ (3,193) | $ 2,960 |
Catastrophe [Member] | |||
Extraordinary Item [Line Items] | |||
Pre-tax catastrophe losses | $ 19,000 | $ 11,000 | $ 17,000 |
Losses And Loss Adjustment Ex76
Losses And Loss Adjustment Expenses (Activity In The Reserves For Losses And Loss Adjustment Expenses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||||
Gross reserves at January 1 | $ 1,091,797 | $ 1,038,984 | $ 1,036,123 | |
Less reinsurance recoverable | (14,546) | (14,484) | (13,927) | $ (12,155) |
Net reserves at January 1 | 1,077,313 | 1,025,057 | 1,023,968 | |
Acquisition of WAIC reserves | 18,676 | 0 | 0 | |
Incurred losses and loss adjustment expense related to: | ||||
Current year | 2,132,837 | 1,989,315 | 1,959,730 | |
Prior years | (12,658) | 3,193 | (2,960) | |
Total incurred losses and loss adjustment expenses | 2,145,495 | 1,986,122 | 1,962,690 | |
Loss and loss adjustment expense payments related to: | ||||
Current year | 1,455,245 | 1,347,967 | 1,354,074 | |
Prior years | 654,097 | 585,899 | 607,527 | |
Total payments | 2,109,342 | 1,933,866 | 1,961,601 | |
Net reserves at year-end | 1,132,142 | 1,077,313 | 1,025,057 | |
Reinsurance recoverable | 14,546 | 14,484 | 13,927 | |
Gross reserves at year-end | $ 1,146,688 | $ 1,091,797 | $ 1,038,984 |
Dividends (Dividends Paid In To
Dividends (Dividends Paid In Total And Per Share) (Details) - USD ($) $ / shares in Units, $ in Thousands | Feb. 05, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 |
Dividends [Abstract] | ||||
Total paid | $ 136,386 | $ 135,496 | $ 134,776 | |
Per share (in dollars per share) | $ 2.4725 | $ 2.4625 | $ 2.4525 | |
Maximum dividend payable without prior permission of DOI of states domicile | $ 164,000 | |||
Payments of ordinary dividends | $ 133,000 | $ 225,000 | $ 120,000 | |
Subsequent Event [Member] | ||||
Subsequent Event [Line Items] | ||||
Quarterly dividend declared (in dollars per share) | $ 0.62 |
Statutory Balances and Accoun78
Statutory Balances and Accounting Practices (Schedule Of Statutory Net Income And Capital And Surplus) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Statutory Balances And Accounting Practices [Abstract] | ||||
Statutory net income | [1] | $ 123,984 | $ 155,654 | $ 235,251 |
Statutory capital and surplus | $ 1,451,950 | $ 1,438,281 | $ 1,528,682 | |
RBC authorized control level | 375.00% | 375.00% | 375.00% | |
Minimum RBC authorized control level | 200.00% | 200.00% | 200.00% | |
[1] | Statutory net income reflects differences from GAAP net income, including changes in the fair value of the investment portfolio as a result of the application of the fair value option. |
Profit Sharing Plan and Annua79
Profit Sharing Plan and Annual Cash Bonuses (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Deferred Compensation Arrangements [Abstract] | |||
Maximum percentage of compensation employee is allowed to contribute | 15.00% | ||
Matching contributions | $ 8.5 | $ 8 | $ 8.1 |
Bonus expense, cash | $ 20.7 | $ 19.1 | $ 0 |
Share-Based Compensation (Narra
Share-Based Compensation (Narrative) (Details) - USD ($) $ in Thousands | Jan. 01, 2008 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2007 | Feb. 28, 2015 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Options granted during period | 0 | |||||
Intrinsic value of stock options exercised | $ 303 | $ 1,160 | $ 862 | |||
Total fair value of stock options vested | 142 | $ 142 | $ 146 | |||
Stock Options [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Unrecognized compensation cost | $ 202 | |||||
Weighted-average period of recognition, in years | 1 year 4 months 21 days | |||||
Restricted Stock And Restricted Stock Unit [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Target restricted stock granted during period | 1,000 | 8,000 | 6,000 | |||
Two Thousand Fifteen Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Common stock authorized for issuance | 4,900,000 | |||||
2005 Plan [Member] | ||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||
Percentage of stock option exercisable per year | 25.00% | 20.00% | ||||
Stock option expiration period (in years) | 10 years |
Share-Based Compensation (Share
Share-Based Compensation (Share-based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Cash received from stock option exercises | $ 2,111 | $ 6,247 | $ 1,446 |
Share-based compensation expense | 5,208 | 4,112 | 974 |
Tax benefit on sales of incentive stock options | 27 | 148 | 202 |
Common Stock [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Tax benefit on sales of incentive stock options | $ 27 | $ 148 | $ 202 |
Share-Based Compensation (Stock
Share-Based Compensation (Stock Option Valuation Assumptions) (Details) - Stock Options [Member] | 12 Months Ended |
Dec. 31, 2013$ / shares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Weighted-average grant-date fair value | $ 7.11 |
Weighted-average expected volatility | 33.17% |
Expected term | 72 months |
Minimum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 33.16% |
Risk-free interest rate | 0.88% |
Expected dividend yield | 5.40% |
Maximum [Member] | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Expected volatility | 33.18% |
Risk-free interest rate | 1.60% |
Expected dividend yield | 5.76% |
Share-Based Compensation (Summa
Share-Based Compensation (Summary Of Stock Option Activity) (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($)$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |
Outstanding Shares, Beginning balance | shares | 248,000 |
Granted, Shares | shares | 0 |
Exercised, Shares | shares | (43,000) |
Cancelled or expired, Shares | shares | (37,000) |
Outstanding Shares, Ending balance | shares | 168,000 |
Exercisable, Shares | shares | 128,000 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Roll Forward] | |
Outstanding, Weighted-Average Exercise Price, Beginning balance (in dollars per share) | $ / shares | $ 49.85 |
Granted, Weighted-Average Exercise Price (in dollars per share) | $ / shares | |
Exercised, Weighted-Average Exercise Price (in dollars per share) | $ / shares | $ 49.10 |
Canceled or Expired, Weighted-Average Exercise Price (in dollars per share) | $ / shares | 58.48 |
Outstanding, Weighted-Average Exercise Price, Ending balance (in dollars per share) | $ / shares | 48.14 |
Exercisable, Weighted-Average Exercise Price (in dollars per share) | $ / shares | $ 49.58 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | |
Outstanding, Weighted-Average Remaining Contractual Term (Years) | 3 years 9 months 21 days |
Exercisable, Weighted-Average Remaining Contractual Term (Years) | 2 years 8 months 21 days |
Outstanding, Aggregate Intrinsic Value | $ | $ 305 |
Exercisable, Aggregate Intrinsic Value | $ | $ 183 |
Share-Based Compensation (Sto84
Share-Based Compensation (Stock Option Awards) (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options Outstanding, Number of Options | 168,000 | 248,000 |
Options Outstanding, Weighted-Avg. Remaining Contractual Life (Years) | 3 years 9 months 21 days | |
Options Outstanding, Weighted-Avg. Exercise Price (in dollars per share) | $ 48.14 | $ 49.85 |
Options Exercisable, Number of Options | 128,000 | |
Options Exercisable, Weighted-Avg. Exercise Price (in dollars per share) | $ 49.58 | |
$33.61-47.61 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options Outstanding, Number of Options | 88,000 | |
Options Outstanding, Weighted-Avg. Remaining Contractual Life (Years) | 6 years 1 month 21 days | |
Options Outstanding, Weighted-Avg. Exercise Price (in dollars per share) | $ 43.29 | |
Options Exercisable, Number of Options | 48,000 | |
Options Exercisable, Weighted-Avg. Exercise Price (in dollars per share) | $ 43.09 | |
Range of Exercise Prices, lower limit (in dollars per share) | 33.61 | |
Range of Exercise Prices, upper limit (in dollars per share) | $ 47.61 | |
$50.01-51.51 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options Outstanding, Number of Options | 38,000 | |
Options Outstanding, Weighted-Avg. Remaining Contractual Life (Years) | 2 years | |
Options Outstanding, Weighted-Avg. Exercise Price (in dollars per share) | $ 50.72 | |
Options Exercisable, Number of Options | 38,000 | |
Options Exercisable, Weighted-Avg. Exercise Price (in dollars per share) | $ 50.72 | |
Range of Exercise Prices, lower limit (in dollars per share) | 50.01 | |
Range of Exercise Prices, upper limit (in dollars per share) | $ 51.51 | |
$54.93-57.50 [Member] | ||
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Options Outstanding, Number of Options | 42,000 | |
Options Outstanding, Weighted-Avg. Remaining Contractual Life (Years) | 9 months 21 days | |
Options Outstanding, Weighted-Avg. Exercise Price (in dollars per share) | $ 55.96 | |
Options Exercisable, Number of Options | 42,000 | |
Options Exercisable, Weighted-Avg. Exercise Price (in dollars per share) | $ 55.96 | |
Range of Exercise Prices, lower limit (in dollars per share) | 54.93 | |
Range of Exercise Prices, upper limit (in dollars per share) | $ 57.50 |
Share-Based Compensation Share-
Share-Based Compensation Share-Based Compensation (Summary of Grants) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Three-year performance period ending December 31, | 2,017 | 2,016 | 2,015 |
Vesting shares, target (net of forfeited) | 99,250 | 85,500 | 78,500 |
Vesting shares, maximum (net of forfeited) | 186,094 | 160,313 | 176,625 |
Share-Based Compensation (Sum86
Share-Based Compensation (Summary Of Vested And Unvested RSU) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Vesting shares, target (net of forfeited) | 99,250 | 85,500 | 78,500 |
Restricted Stock And Restricted Stock Unit [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |||
Outstanding Shares, Balance | 167,000 | 170,500 | 169,000 |
Vesting shares, target (net of forfeited) | 100,250 | 93,500 | 84,500 |
Vested, Shares | 0 | 0 | 0 |
Forfeited/Canceled | (4,000) | (16,500) | (3,000) |
Expired, Shares | 0 | (80,500) | (80,000) |
Outstanding Shares, Balance | 263,250 | 167,000 | 170,500 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward] | |||
Outstanding, Weighted-Average Fair Value per Share (in dollars per share) | $ 41.15 | $ 39.64 | $ 42.22 |
Granted, Weighted-Average Fair Value per Share (in dollars per share) | 53.80 | 45.17 | 36.82 |
Forfeited/Canceled, Weighted-Average Fair Value per Share (in dollars per share) | 43.10 | 43.99 | 36.82 |
Expired, Weighted-Average Fair Value per Share (in dollars per share) | 0 | 44.01 | 40.22 |
Outstanding, Weighted-Average Fair Value per Share (in dollars per share) | $ 45.94 | $ 41.15 | $ 39.64 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2015 | [1] | Sep. 30, 2015 | [1] | Jun. 30, 2015 | [1] | Mar. 31, 2015 | [1] | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Income (Numerator) | ||||||||||||||||
Income available to common stockholders, Basic | $ 74,479 | $ 177,949 | $ 112,143 | |||||||||||||
Income available to common stockholders after assumed conversions, Diluted | $ 74,479 | $ 177,949 | $ 112,143 | |||||||||||||
Weighted Shares (Denominator) | ||||||||||||||||
Weighted shares, basic (in shares) | 55,157 | 55,008 | 54,947 | |||||||||||||
Weighted shares, diluted (in shares) | 55,209 | 55,020 | 54,964 | |||||||||||||
Earnings Per Share Basic and Diluted, Per Share Amounts [Abstract] | ||||||||||||||||
Basic (in dollars per share) | $ 0.42 | $ 0.28 | $ 0.17 | $ 0.47 | $ (0.38) | $ 0.57 | $ 1.73 | $ 1.32 | $ 1.35 | $ 3.23 | $ 2.04 | |||||
Diluted (in dollars per share) | $ 0.42 | $ 0.28 | $ 0.17 | $ 0.47 | $ (0.38) | [1] | $ 0.57 | $ 1.73 | $ 1.32 | $ 1.35 | $ 3.23 | $ 2.04 | ||||
Common Stock [Member] | ||||||||||||||||
Earnings Per Share Basic and Diluted, Per Share Amounts [Abstract] | ||||||||||||||||
Potentially dilutive securities (in shares) | 67 | 252 | 359 | |||||||||||||
Stock Options [Member] | ||||||||||||||||
Income (Numerator) | ||||||||||||||||
Effect of dilutive securities: Options | $ 0 | $ 0 | $ 0 | |||||||||||||
Weighted Shares (Denominator) | ||||||||||||||||
Effect of dilutive securities: options (in shares) | 15 | 12 | 17 | |||||||||||||
Restricted Stock Units (RSUs) [Member] | ||||||||||||||||
Income (Numerator) | ||||||||||||||||
Effect of dilutive securities: Options | $ 0 | $ 0 | $ 0 | |||||||||||||
Weighted Shares (Denominator) | ||||||||||||||||
Effect of dilutive securities: options (in shares) | 37 | 0 | 0 | |||||||||||||
[1] | The basic and diluted earnings per share do not sum due to rounding. |
Commitments and Contingencies88
Commitments and Contingencies (Narrative) (Details) | Mar. 02, 2015USD ($) | Dec. 08, 2014USD ($) | Apr. 30, 2010instance_of_noncompliance | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) |
Loss Contingencies [Line Items] | ||||||
Deferred rent | $ 3,600,000 | $ 4,400,000 | ||||
Total rent expense | 16,000,000 | 14,600,000 | $ 19,300,000 | |||
Exposure to earthquake loss | $ 64,300,000 | |||||
Number of instances of non-compliance issued from regulatory body | instance_of_noncompliance | 35 | |||||
Litigation Settlement, Expense | $ 27,593,550 | |||||
Settlement of fine and penalty levied by California DOI | $ 27,593,550 | |||||
California Department of Insurance [Member] | ||||||
Loss Contingencies [Line Items] | ||||||
Settlement of fine and penalty levied by California DOI | $ 1,000,000 |
Commitments and Contingencies89
Commitments and Contingencies (Future Minimum Commitments For Operating Leases) (Details) $ in Thousands | Dec. 31, 2015USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2,016 | $ 14,765 |
2,017 | 11,008 |
2,018 | 4,684 |
2,019 | 1,006 |
2,020 | 463 |
Thereafter | $ 64 |
Acquisition (Details)
Acquisition (Details) - Workmen's Auto Insurance Company [Member] - USD ($) $ in Millions | Jan. 12, 2015 | Jan. 02, 2015 |
Subsequent Event [Line Items] | ||
Consideration paid in cash | $ 8 | |
Amount held in escrow | $ 2 | |
Term for escrow security payment | 3 years | |
Capital contribution amount | $ 15 |
Quarterly Financial Informati91
Quarterly Financial Information (Summary Of Quarterly Financial Information) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||||||
Quarterly Financial Data [Abstract] | ||||||||||||||||
Net premiums earned | $ 760,094 | $ 745,520 | $ 731,546 | $ 720,737 | $ 709,368 | $ 705,237 | $ 697,889 | $ 683,701 | $ 2,957,897 | $ 2,796,195 | $ 2,698,187 | |||||
Change in fair value of investments pursuant to the fair value option | 2,474 | (18,538) | (40,783) | (4,884) | (22,824) | (20,528) | 41,412 | 45,699 | (61,731) | 43,759 | (44,037) | |||||
Income before income taxes | 23,930 | 12,267 | 4,511 | 29,859 | (28,161) | 37,120 | 136,436 | 102,030 | 70,567 | 247,425 | 132,096 | |||||
Net income | $ 23,405 | $ 15,270 | $ 9,639 | $ 26,165 | $ (20,956) | $ 31,296 | $ 94,960 | $ 72,649 | $ 74,479 | $ 177,949 | $ 112,143 | |||||
Basic (in dollars per share) | $ 0.42 | [1] | $ 0.28 | [1] | $ 0.17 | [1] | $ 0.47 | [1] | $ (0.38) | $ 0.57 | $ 1.73 | $ 1.32 | $ 1.35 | $ 3.23 | $ 2.04 | |
Diluted (in dollars per share) | 0.42 | [1] | 0.28 | [1] | 0.17 | [1] | 0.47 | [1] | (0.38) | [1] | 0.57 | 1.73 | 1.32 | 1.35 | 3.23 | $ 2.04 |
Dividends paid per share | $ 0.62 | $ 0.6175 | $ 0.6175 | $ 0.6175 | $ 0.6175 | $ 0.6175 | $ 0.6150 | $ 0.6150 | $ 0.62 | $ 0.6175 | ||||||
[1] | The basic and diluted earnings per share do not sum due to rounding. |
Quarterly Financial Informati92
Quarterly Financial Information (Narrative) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||
Dec. 31, 2015 | Dec. 31, 2014 | Mar. 31, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Restructuring Cost and Reserve | ||||||
Net realized investment losses (gains) | $ 8,200,000 | $ 21,600,000 | $ 83,807,000 | $ (81,184,000) | $ 11,422,000 | |
Settlement of fine and penalty levied by California DOI | $ 27,593,550 | |||||
Employee Severance [Member] | ||||||
Restructuring Cost and Reserve | ||||||
Workforce reduction, office closure and severance expense | $ 10,000,000 |
Segment Information - Summary o
Segment Information - Summary of Operating Results by Segment (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015USD ($)State | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)StateSubsidiary | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Segment Reporting [Abstract] | |||||||||||
Number of insurance companies | Subsidiary | 14 | ||||||||||
Number of states in which company operates | State | 13 | 13 | |||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net premiums earned | $ 760,094 | $ 745,520 | $ 731,546 | $ 720,737 | $ 709,368 | $ 705,237 | $ 697,889 | $ 683,701 | $ 2,957,897 | $ 2,796,195 | $ 2,698,187 |
Losses and loss adjustment expenses | 2,145,495 | 1,986,122 | 1,962,690 | ||||||||
Underwriting expenses | 790,000 | 775,600 | 724,900 | ||||||||
Underwriting gain | 22,400 | 34,500 | 10,600 | ||||||||
Net investment income | 126,299 | 125,723 | 124,538 | ||||||||
Net realized investment (losses) gains | (8,200) | (21,600) | (83,807) | 81,184 | (11,422) | ||||||
Other | 8,911 | 8,671 | 9,738 | ||||||||
Interest Expense | (3,168) | (2,637) | (1,260) | ||||||||
Pre-tax income | 23,930 | 12,267 | 4,511 | 29,859 | (28,161) | 37,120 | 136,436 | 102,030 | 70,567 | 247,425 | 132,096 |
Net income | $ 23,405 | $ 15,270 | $ 9,639 | $ 26,165 | $ (20,956) | $ 31,296 | $ 94,960 | $ 72,649 | 74,479 | 177,949 | 112,143 |
Property and Casualty Lines [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net premiums earned | 2,906,600 | 2,737,300 | 2,638,400 | ||||||||
Losses and loss adjustment expenses | 2,117,300 | 1,951,400 | 1,926,400 | ||||||||
Underwriting expenses | 770,000 | 749,700 | 701,000 | ||||||||
Underwriting gain | 19,300 | 36,200 | 11,000 | ||||||||
Other Segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Net premiums earned | 51,300 | 58,900 | 59,800 | ||||||||
Losses and loss adjustment expenses | 28,200 | 34,700 | 36,300 | ||||||||
Underwriting expenses | 20,000 | 25,900 | 23,900 | ||||||||
Underwriting gain | $ 3,100 | $ (1,700) | $ (400) |
Segment Information - Summary94
Segment Information - Summary of Premiums Written and Earned by Segment (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | $ 3,012,900 | $ 2,853,200 | $ 2,737,500 | ||||||||
Net premiums earned | $ 760,094 | $ 745,520 | $ 731,546 | $ 720,737 | $ 709,368 | $ 705,237 | $ 697,889 | $ 683,701 | 2,957,897 | 2,796,195 | 2,698,187 |
Property and Casualty, Personal Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 2,345,800 | 2,223,100 | 2,165,600 | ||||||||
Net premiums earned | 2,308,600 | 2,203,000 | 2,163,400 | ||||||||
Property Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 402,200 | 374,500 | 340,000 | ||||||||
Net premiums earned | 379,700 | 347,900 | 328,500 | ||||||||
Property and Casualty, Commercial Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 153,500 | 135,900 | 104,700 | ||||||||
Net premiums earned | 144,400 | 121,800 | 88,300 | ||||||||
Other Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 111,400 | 119,700 | 127,200 | ||||||||
Net premiums earned | 125,200 | 123,500 | 118,000 | ||||||||
Property and Casualty Lines [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 2,983,100 | 2,808,900 | 2,674,700 | ||||||||
Net premiums earned | 2,906,600 | 2,737,300 | 2,638,400 | ||||||||
Property and Casualty Lines [Member] | Property and Casualty, Personal Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 2,345,800 | 2,223,100 | 2,165,600 | ||||||||
Net premiums earned | 2,308,600 | 2,203,000 | 2,163,400 | ||||||||
Property and Casualty Lines [Member] | Property Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 402,200 | 374,500 | 340,000 | ||||||||
Net premiums earned | 379,700 | 347,900 | 328,500 | ||||||||
Property and Casualty Lines [Member] | Property and Casualty, Commercial Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 153,500 | 135,900 | 104,700 | ||||||||
Net premiums earned | 144,400 | 121,800 | 88,300 | ||||||||
Property and Casualty Lines [Member] | Other Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 81,600 | 75,400 | 64,400 | ||||||||
Net premiums earned | 73,900 | 64,600 | 58,200 | ||||||||
Other Segments [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 29,800 | 44,300 | 62,800 | ||||||||
Net premiums earned | 51,300 | 58,900 | 59,800 | ||||||||
Other Segments [Member] | Property and Casualty, Personal Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 0 | 0 | 0 | ||||||||
Net premiums earned | 0 | 0 | 0 | ||||||||
Other Segments [Member] | Property Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 0 | 0 | 0 | ||||||||
Net premiums earned | 0 | 0 | 0 | ||||||||
Other Segments [Member] | Property and Casualty, Commercial Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 0 | 0 | 0 | ||||||||
Net premiums earned | 0 | 0 | 0 | ||||||||
Other Segments [Member] | Other Insurance Product Line [Member] | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Direct Premiums Written | 29,800 | 44,300 | 62,800 | ||||||||
Net premiums earned | $ 51,300 | $ 58,900 | $ 59,800 |
Summary Of Investments Other 95
Summary Of Investments Other Than Investments In Related Parties (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | $ 3,303,156 | $ 3,264,525 |
Fair value | 3,380,642 | 3,403,822 |
Amounts in the balance sheet | 3,380,642 | 3,403,822 |
Fixed Maturity Securities [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 2,804,275 | 2,503,494 |
Fair value | 2,880,003 | 2,618,400 |
Amounts in the balance sheet | 2,880,003 | 2,618,400 |
Fixed Maturity Securities [Member] | U.S. Government Bonds And Agencies [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 22,542 | 16,028 |
Fair value | 22,507 | 16,108 |
Amounts in the balance sheet | 22,507 | 16,108 |
Fixed Maturity Securities [Member] | Municipal Securities [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 2,417,046 | 2,160,710 |
Fair value | 2,505,039 | 2,275,455 |
Amounts in the balance sheet | 2,505,039 | 2,275,455 |
Fixed Maturity Securities [Member] | Collateralized Mortgage Backed Securities [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 49,639 | 45,519 |
Fair value | 49,839 | 47,691 |
Amounts in the balance sheet | 49,839 | 47,691 |
Fixed Maturity Securities [Member] | Corporate Debt Securities [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 255,606 | 258,940 |
Fair value | 243,372 | 256,930 |
Amounts in the balance sheet | 243,372 | 256,930 |
Fixed Maturity Securities [Member] | Collateralized Debt Obligations [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 50,710 | 22,297 |
Fair value | 50,548 | 22,216 |
Amounts in the balance sheet | 50,548 | 22,216 |
Fixed Maturity Securities [Member] | Collateralized Auto Loans [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 8,732 | |
Fair value | 8,698 | |
Amounts in the balance sheet | 8,698 | |
Equity Securities [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 313,528 | 387,851 |
Fair value | 315,362 | 412,880 |
Amounts in the balance sheet | 315,362 | 412,880 |
Equity Securities [Member] | Common Stock [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 275,479 | 349,839 |
Fair value | 280,263 | 372,598 |
Amounts in the balance sheet | 280,263 | 372,598 |
Equity Securities [Member] | Non-Redeemable Preferred Stock [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 25,161 | 28,012 |
Fair value | 24,668 | 28,563 |
Amounts in the balance sheet | 24,668 | 28,563 |
Equity Securities [Member] | Partnership Interest in a Private Credit Fund [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 12,888 | 10,000 |
Fair value | 10,431 | 11,719 |
Amounts in the balance sheet | 10,431 | 11,719 |
Short-term Investments [Member] | ||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||
Cost | 185,353 | 373,180 |
Fair value | 185,277 | 372,542 |
Amounts in the balance sheet | $ 185,277 | $ 372,542 |
Condensed Financial Informati96
Condensed Financial Information of Registrant (Schedule Of Condensed Financial Information Of Registrant, Balance Sheets) (Details) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
Investments, at fair value: | ||||
Fixed maturity securities (cost $557; $0) | $ 2,880,003 | $ 2,618,400 | ||
Equity securities (cost $131,217; $189,032) | 315,362 | 412,880 | ||
Short-term investments (cost $1,144; $9,744) | 185,277 | 372,542 | ||
Total investments | 3,380,642 | 3,403,822 | ||
Cash | 264,221 | 289,907 | $ 266,508 | $ 158,183 |
Accrued investment income | 42,747 | 38,737 | ||
Current income taxes | 9,041 | 503 | ||
Deferred income taxes | 23,231 | 0 | ||
Other assets | 16,826 | 21,512 | ||
Total assets | 4,628,645 | 4,600,289 | ||
Liabilities | ||||
Notes payable | 290,000 | 290,000 | ||
Other liabilities | 199,187 | 207,028 | ||
Total liabilities | 2,807,760 | 2,724,843 | ||
Shareholders’ equity: | ||||
Common stock | 90,985 | 88,705 | ||
Additional paid-in capital | 8,870 | 3,804 | ||
Retained earnings | 1,721,030 | 1,782,937 | ||
Total shareholders’ equity | 1,820,885 | 1,875,446 | 1,822,486 | |
Total liabilities and shareholders’ equity | 4,628,645 | 4,600,289 | ||
Amortized cost on fixed maturities trading investments | 2,804,275 | 2,503,494 | ||
Cost - equity security trading investments | 313,528 | 387,851 | ||
Cost - short-term investments | 185,353 | 373,180 | ||
Parent Company [Member] | ||||
Investments, at fair value: | ||||
Fixed maturity securities (cost $557; $0) | 571 | 0 | ||
Equity securities (cost $131,217; $189,032) | 127,572 | 182,300 | ||
Short-term investments (cost $1,144; $9,744) | 1,144 | 9,744 | ||
Investment in subsidiaries | 1,819,426 | 1,783,049 | ||
Total investments | 1,948,713 | 1,975,093 | ||
Cash | 20,139 | 52,326 | $ 46,332 | $ 10,199 |
Accrued investment income | 208 | 158 | ||
Amounts receivable from affiliates | 220 | 1,181 | ||
Current income taxes | 8,894 | 239 | ||
Deferred income taxes | 10,524 | 6,975 | ||
Income tax receivable from affiliates | 5,917 | 3,482 | ||
Other assets | 2,981 | 1,095 | ||
Total assets | 1,997,596 | 2,040,549 | ||
Liabilities | ||||
Notes payable | 150,000 | 150,000 | ||
Amounts payable to affiliates | 25 | 97 | ||
Income tax payable to affiliates | 26,439 | 14,728 | ||
Other liabilities | 247 | 278 | ||
Total liabilities | 176,711 | 165,103 | ||
Shareholders’ equity: | ||||
Common stock | 90,985 | 88,705 | ||
Additional paid-in capital | 8,870 | 3,804 | ||
Retained earnings | 1,721,030 | 1,782,937 | ||
Total shareholders’ equity | 1,820,885 | 1,875,446 | ||
Total liabilities and shareholders’ equity | 1,997,596 | 2,040,549 | ||
Amortized cost on fixed maturities trading investments | 557 | 0 | ||
Cost - equity security trading investments | 189,032 | 27,499 | ||
Cost - short-term investments | $ 9,744 | $ 11,089 |
Condensed Financial Informati97
Condensed Financial Information of Registrant (Schedule Of Condensed Financial Information Of Registrant, Statements Of Operations) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||||||||||
Net investment income | $ 126,299 | $ 125,723 | $ 124,538 | ||||||||
Net realized investment (losses) gains | $ (8,200) | $ (21,600) | (83,807) | 81,184 | (11,422) | ||||||
Total revenues | 3,009,300 | 3,011,773 | 2,821,041 | ||||||||
Expenses: | |||||||||||
Other operating expenses | 250,839 | 249,381 | 219,478 | ||||||||
Interest | 3,168 | 2,637 | 1,260 | ||||||||
Total expenses | 2,938,733 | 2,764,348 | 2,688,945 | ||||||||
Pre-tax income | 23,930 | $ 12,267 | $ 4,511 | $ 29,859 | (28,161) | $ 37,120 | $ 136,436 | $ 102,030 | 70,567 | 247,425 | 132,096 |
Income tax (benefit) expense | (3,912) | 69,476 | 19,953 | ||||||||
Net income | $ 23,405 | $ 15,270 | $ 9,639 | $ 26,165 | $ (20,956) | $ 31,296 | $ 94,960 | $ 72,649 | 74,479 | 177,949 | 112,143 |
Parent Company [Member] | |||||||||||
Revenues: | |||||||||||
Net investment income | 4,314 | 4,478 | 1,293 | ||||||||
Net realized investment (losses) gains | (7,026) | (9,428) | 3,416 | ||||||||
Total revenues | (2,712) | (4,950) | 4,709 | ||||||||
Expenses: | |||||||||||
Other operating expenses | 7,526 | 5,971 | 2,924 | ||||||||
Interest | 2,127 | 1,746 | 318 | ||||||||
Total expenses | 9,653 | 7,717 | 3,242 | ||||||||
Pre-tax income | (12,365) | (12,667) | 1,467 | ||||||||
Income tax (benefit) expense | (4,708) | (100) | 3,310 | ||||||||
Loss before equity in net income of subsidiaries | (7,657) | (12,567) | (1,843) | ||||||||
Equity in net income of subsidiaries | 82,136 | 190,516 | 113,986 | ||||||||
Net income | $ 74,479 | $ 177,949 | $ 112,143 |
Condensed Financial Informati98
Condensed Financial Information of Registrant (Schedule Of Condensed Financial Information Of Registrant, Statements Of Cash Flow) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net cash provided by (used in) operating activities | $ 190,244 | $ 246,535 | $ 209,804 |
Equity securities available for sale in nature | |||
Purchases | (965,701) | (542,494) | (831,796) |
Sales | 805,417 | 745,058 | 872,997 |
(Decrease) in payable for securities, net | (1,387) | 9,294 | 1,702 |
Business acquisition, net of cash acquired | 7,771 | 0 | 0 |
Other, net | 2,473 | 3,472 | 1,741 |
Net cash used in investing activities | (81,682) | (194,035) | (18,351) |
Cash flows from financing activities: | |||
Dividends paid to shareholders | (136,386) | (135,496) | (134,776) |
Excess tax benefit from exercise of stock options | 27 | 148 | 202 |
Proceeds from stock options exercised | 2,111 | 6,247 | 1,446 |
Proceeds from bank loan | 0 | 100,000 | 50,000 |
Net cash used in financing activities | (134,248) | (29,101) | (83,128) |
Net increase (decrease) in cash | (25,686) | 23,399 | 108,325 |
Cash: | |||
Beginning of year | 289,907 | 266,508 | 158,183 |
End of year | 264,221 | 289,907 | 266,508 |
SUPPLEMENTAL CASH FLOW DISCLOSURE | |||
Interest paid | 2,989 | 2,543 | 998 |
Income taxes paid (received) | 31,390 | 61,139 | 16,503 |
Parent Company [Member] | |||
Cash flows from operating activities: | |||
Net cash provided by (used in) operating activities | 548 | (3,434) | (843) |
Cash flows from investing activities: | |||
Capital contribution to subsidiaries | (90,125) | (30,125) | (40,125) |
Distributions received from special purpose entities | 8,883 | 6,756 | 0 |
Dividends received from subsidiaries | 133,000 | 225,000 | 120,000 |
Purchases of fixed maturity securities available for sale in nature | (571) | 0 | 0 |
Equity securities available for sale in nature | |||
Purchases | (146,236) | (254,572) | (25,038) |
Sales | 192,005 | 90,422 | 25,798 |
(Decrease) in payable for securities, net | 0 | (2,489) | 2,489 |
Net decrease in short-term investments | (8,612) | (1,346) | (36,085) |
Business acquisition, net of cash acquired | (6,000) | 0 | 0 |
Other, net | 1,945 | 2,191 | 895 |
Net cash used in investing activities | 101,513 | 38,529 | 120,104 |
Cash flows from financing activities: | |||
Dividends paid to shareholders | (136,386) | (135,496) | (134,776) |
Excess tax benefit from exercise of stock options | 27 | 148 | 202 |
Proceeds from stock options exercised | 2,111 | 6,247 | 1,446 |
Proceeds from bank loan | 0 | 100,000 | 50,000 |
Net cash used in financing activities | (134,248) | (29,101) | (83,128) |
Net increase (decrease) in cash | (32,187) | 5,994 | 36,133 |
Cash: | |||
Beginning of year | 52,326 | 46,332 | 10,199 |
End of year | 20,139 | 52,326 | 46,332 |
SUPPLEMENTAL CASH FLOW DISCLOSURE | |||
Interest paid | 2,153 | 1,757 | 318 |
Income taxes paid (received) | $ 1,807 | $ 2,112 | $ (827) |
Condensed Financial Informati99
Condensed Financial Information of Registrant Condensed Financial Information of Registrant (Narratives) (Details) - USD ($) | Jan. 12, 2015 | Jan. 02, 2015 | Feb. 13, 2014 | Aug. 09, 2013 | Jul. 02, 2013 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 03, 2014 | |
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Proceeds from special purpose investment vehicles | $ 8,900,000 | $ 6,800,000 | ||||||||
Proceeds from dividends received | 133,000,000 | 225,000,000 | $ 120,000,000 | |||||||
Capital contributions to subsidiaries | 90,125,000 | 30,125,000 | $ 40,125,000 | |||||||
Loan maximum borrowing capacity | $ 200,000,000 | |||||||||
Revolving credit facility term | 5 years | |||||||||
Credit facility | [1] | 150,000,000 | 150,000,000 | |||||||
Total borrowing guaranteed | 20,000,000 | $ 20,000,000 | ||||||||
Revolving Credit Facility [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Loan maximum borrowing capacity | $ 200,000,000 | $ 250,000,000 | ||||||||
Revolving credit facility term | 5 years | |||||||||
Credit facility | $ 150,000,000 | |||||||||
Interest rate at period end | 1.53% | |||||||||
Workmen's Auto Insurance Company [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Consideration paid in cash | $ 8,000,000 | |||||||||
Amount held in escrow | $ 2,000,000 | |||||||||
Term for escrow security payment | 3 years | |||||||||
Capital contribution amount | $ 15,000,000 | |||||||||
Mcc [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Credit facility | $ 120,000,000 | |||||||||
Bank loan | 20,000,000 | |||||||||
Municipal bonds, fair value | 180,000,000 | |||||||||
Total borrowing guaranteed | 140,000,000 | |||||||||
Swap [Member] | FFL [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Notional amount | 95,000,000 | |||||||||
Swap agreement collateral | 30,000,000 | |||||||||
Term of swap agreement | 1 year | 3 years | ||||||||
Swap [Member] | FFL [Member] | LIBOR [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Basis spread on variable rate | 1.40% | 140000.00% | ||||||||
Swap [Member] | AFL [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Notional amount | 124,000,000 | |||||||||
Swap agreement collateral | $ 40,000,000 | |||||||||
Swap [Member] | AFL [Member] | LIBOR [Member] | ||||||||||
Condensed Financial Statements, Captions [Line Items] | ||||||||||
Basis spread on variable rate | 120000.00% | 1.20% | ||||||||
[1] | On July 2, 2013, the Company entered into an unsecured $200 million five-year revolving credit facility. The interest rate on borrowings under the credit facility is based on the Company's debt to total capital ratio and ranges from LIBOR plus 112.5 basis points when the ratio is under 15% to LIBOR plus 162.5 basis points when the ratio is above 25%. Commitment fees for the undrawn portions of the credit facility range from 12.5 basis points when the ratio is under 15% to 22.5 basis points when the ratio is above 25%. Debt to capital ratio is expressed as a percentage of (i) consolidated debt to (ii) consolidated shareholders' equity plus consolidated debt. Effective December 3, 2014, the Company extended the maturity date of the unsecured credit facility from June 30, 2018 to December 3, 2019, and expanded the borrowing capacity from $200 million to $250 million. In 2015 and 2014, the interest rate was LIBOR plus 112.5 basis points on the $150 million of borrowings and 12.5 basis points on the undrawn portion of the credit facility. The interest rate was approximately 1.53% at December 31, 2015. |
Supplemental Reinsurance Pre100
Supplemental Reinsurance Premiums (Schedule of Property and Liability Insurance Earned Premiums) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Supplementary Insurance Information [Abstract] | |||||||||||
Direct amounts | $ 2,970,424 | $ 2,806,889 | $ 2,704,401 | ||||||||
Ceded to other companies | (12,964) | (11,185) | (7,059) | ||||||||
Assumed | 437 | 491 | 845 | ||||||||
Net amounts | $ 760,094 | $ 745,520 | $ 731,546 | $ 720,737 | $ 709,368 | $ 705,237 | $ 697,889 | $ 683,701 | $ 2,957,897 | $ 2,796,195 | $ 2,698,187 |