Document and Entity Information - shares |
6 Months Ended | |
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Jun. 30, 2017 |
Jul. 31, 2017 |
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Document and Entity Information [Abstract] | ||
Entity Registrant Name | MGIC INVESTMENT CORP | |
Entity Central Index Key | 0000876437 | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 370,561,601 | |
Document Fiscal Year Focus | 2017 | |
Document Fiscal Period Focus | Q2 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2017 |
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- Definition If the value is true, then the document is an amendment to previously-filed/accepted document. No definition available.
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- Definition End date of current fiscal year in the format --MM-DD. No definition available.
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- Definition This is focus fiscal period of the document report. For a first quarter 2006 quarterly report, which may also provide financial information from prior periods, the first fiscal quarter should be given as the fiscal period focus. Values: FY, Q1, Q2, Q3, Q4, H1, H2, M9, T1, T2, T3, M8, CY. No definition available.
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- Definition This is focus fiscal year of the document report in CCYY format. For a 2006 annual report, which may also provide financial information from prior periods, fiscal 2006 should be given as the fiscal year focus. Example: 2006. No definition available.
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- Definition The end date of the period reflected on the cover page if a periodic report. For all other reports and registration statements containing historical data, it is the date up through which that historical data is presented. If there is no historical data in the report, use the filing date. The format of the date is CCYY-MM-DD. No definition available.
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- Definition The type of document being provided (such as 10-K, 10-Q, 485BPOS, etc). The document type is limited to the same value as the supporting SEC submission type, or the word "Other". No definition available.
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- Definition A unique 10-digit SEC-issued value to identify entities that have filed disclosures with the SEC. It is commonly abbreviated as CIK. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Indicate number of shares or other units outstanding of each of registrant's classes of capital or common stock or other ownership interests, if and as stated on cover of related periodic report. Where multiple classes or units exist define each class/interest by adding class of stock items such as Common Class A [Member], Common Class B [Member] or Partnership Interest [Member] onto the Instrument [Domain] of the Entity Listings, Instrument. No definition available.
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- Definition Indicate "Yes" or "No" whether registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition Indicate whether the registrant is one of the following: (1) Large Accelerated Filer, (2) Accelerated Filer, (3) Non-accelerated Filer, (4) Smaller Reporting Company (Non-accelerated) or (5) Smaller Reporting Accelerated Filer. Definitions of these categories are stated in Rule 12b-2 of the Exchange Act. This information should be based on the registrant's current or most recent filing containing the related disclosure. No definition available.
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- Definition The exact name of the entity filing the report as specified in its charter, which is required by forms filed with the SEC. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Interest, dividends, rents, ancillary and other revenues earned but not yet received by the entity on its investments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Accumulated change in equity from transactions and other events and circumstances from non-owner sources, net of tax effect, at period end. Excludes Net Income (Loss), and accumulated changes in equity from transactions resulting from investments by owners and distributions to owners. Includes foreign currency translation items, certain pension adjustments, unrealized gains and losses on certain investments in debt and equity securities, other than temporary impairment (OTTI) losses related to factors other than credit losses on available-for-sale and held-to-maturity debt securities that an entity does not intend to sell and it is not more likely than not that the entity will be required to sell before recovery of the amortized cost basis, as well as changes in the fair value of derivatives related to the effective portion of a designated cash flow hedge. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Value received from shareholders in common stock-related transactions that are in excess of par value or stated value and amounts received from other stock-related transactions. Includes only common stock transactions (excludes preferred stock transactions). May be called contributed capital, capital in excess of par, capital surplus, or paid-in capital. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Sum of the carrying amounts as of the balance sheet date of all assets that are recognized. Assets are probable future economic benefits obtained or controlled by an entity as a result of past transactions or events. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of investment in debt and equity securities categorized neither as held-to-maturity nor trading. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount of debt securities categorized neither as held-to-maturity nor trading. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of equity securities categorized neither as held-to-maturity nor as trading. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Represents the caption on the face of the balance sheet to indicate that the entity has entered into (1) purchase or supply arrangements that will require expending a portion of its resources to meet the terms thereof, and (2) is exposed to potential losses or, less frequently, gains, arising from (a) possible claims against a company's resources due to future performance under contract terms, and (b) possible losses or likely gains from uncertainties that will ultimately be resolved when one or more future events that are deemed likely to occur do occur or fail to occur. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Aggregate par or stated value of issued nonredeemable common stock (or common stock redeemable solely at the option of the issuer). This item includes treasury stock repurchased by the entity. Note: elements for number of nonredeemable common shares, par value and other disclosure concepts are in another section within stockholders' equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Including the current and noncurrent portions, carrying amount of debt identified as being convertible into another form of financial instrument (typically the entity's common stock) as of the balance sheet date, which originally required full repayment more than twelve months after issuance or greater than the normal operating cycle of the company. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Including the current and noncurrent portions, the carrying value of convertible subordinated debt, as of the balance sheet date, initially scheduled to be repaid after one year or beyond the normal operating cycle if longer. This form of debt can be exchanged for a specified amount of another security, typically the entity's common stock, at the option of the issuer or the holder, and places a lender in a lien position behind debt having a higher priority of repayment in liquidation of the entity's assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Net amount of deferred policy acquisition costs capitalized on contracts remaining in force as of the balance sheet date. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of advances from the Federal Home Loan Bank (FHLB). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Sum of the carrying amounts as of the balance sheet date of all liabilities that are recognized. Liabilities are probable future sacrifices of economic benefits arising from present obligations of an entity to transfer assets or provide services to other entities in the future. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount of liabilities and equity items, including the portion of equity attributable to noncontrolling interests, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The amount needed to reflect the estimated ultimate cost of settling claims relating to casualty insurance insured events that have occurred on or before a particular date (ordinarily, the balance sheet date) and the amount needed to provide for the estimated ultimate cost required to investigate and settle claims relating to insured events that have occurred on or before a particular date (ordinarily, the balance sheet date), whether or not reported to the insurer at that date. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of assets classified as other. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of liabilities classified as other. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The carrying amount as of the balance sheet date due the entity from (a) agents and insureds, (b) uncollected premiums and (c) others, net of the allowance for doubtful accounts. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount after accumulated depreciation, depletion and amortization of physical assets used in the normal conduct of business to produce goods and services and not intended for resale. Examples include, but are not limited to, land, buildings, machinery and equipment, office equipment, and furniture and fixtures. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after valuation allowance, recoverable under reinsurance contracts for losses reported to the ceding insurer but not yet paid and amounts expected for incurred losses and settlement expenses, which have not yet been reported to the ceding insurer. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after valuation allowance, recoverable under reinsurance contracts for losses reported to and paid by the ceding insurer. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cumulative amount of the reporting entity's undistributed earnings or deficit. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Including the current and noncurrent portions, carrying value as of the balance sheet date of Notes with the highest claim on the assets of the issuer in case of bankruptcy or liquidation (with maturities initially due after one year or beyond the operating cycle if longer). Senior note holders are paid off in full before any payments are made to junior note holders. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition The amount allocated to treasury stock. Treasury stock is common and preferred shares of an entity that were issued, repurchased by the entity, and are held in its treasury. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Carrying amount of premiums written on insurance contracts that have not been earned as of the balance sheet date. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2017 |
Dec. 31, 2016 |
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Statement of Financial Position [Abstract] | ||
Fixed maturities, amortized cost | $ 4,674,965 | $ 4,717,211 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 370,557,000 | 359,400,000 |
Common stock, shares outstanding (in shares) | 370,557,000 | 340,663,000 |
Treasury stock, shares at cost (in shares) | 0 | 18,737,000 |
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- Definition This item represents the cost of debt securities, which are categorized neither as held-to-maturity nor trading, net of adjustments including accretion, amortization, collection of cash, previous other-than-temporary impairments recognized in earnings (less any cumulative-effect adjustments recognized, as defined), and fair value hedge accounting adjustments, if any. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Face amount or stated value per share of common stock. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The maximum number of common shares permitted to be issued by an entity's charter and bylaws. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Total number of common shares of an entity that have been sold or granted to shareholders (includes common shares that were issued, repurchased and remain in the treasury). These shares represent capital invested by the firm's shareholders and owners, and may be all or only a portion of the number of shares authorized. Shares issued include shares outstanding and shares held in the treasury. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Number of shares of common stock outstanding. Common stock represent the ownership interest in a corporation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Number of common and preferred shares that were previously issued and that were repurchased by the issuing entity and held in treasury on the financial statement date. This stock has no voting rights and receives no dividends. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
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Premiums written: | ||||
Direct | $ 275,245,000 | $ 282,113,000 | $ 541,068,000 | $ 547,404,000 |
Assumed | 685,000 | 182,000 | 1,973,000 | 390,000 |
Ceded | (30,096,000) | (32,280,000) | (60,505,000) | (66,498,000) |
Net premiums written | 245,834,000 | 250,015,000 | 482,536,000 | 481,296,000 |
Increase in unearned premiums, net | (14,698,000) | (18,559,000) | (22,297,000) | (28,499,000) |
Net premiums earned | 231,136,000 | 231,456,000 | 460,239,000 | 452,797,000 |
Investment income, net of expenses | 29,716,000 | 27,248,000 | 59,193,000 | 55,057,000 |
Net realized investment (losses) gains | (42,000) | 836,000 | (164,000) | 3,892,000 |
Other revenue | 2,502,000 | 3,994,000 | 4,924,000 | 10,367,000 |
Total revenues | 263,312,000 | 263,534,000 | 524,192,000 | 522,113,000 |
Losses and expenses: | ||||
Losses incurred, net | 27,339,000 | 46,590,000 | 54,958,000 | 131,602,000 |
Amortization of deferred policy acquisition costs | 2,584,000 | 2,245,000 | 4,814,000 | 4,206,000 |
Other underwriting and operating expenses, net | 38,511,000 | 35,348,000 | 79,276,000 | 75,125,000 |
Interest expense | 14,197,000 | 12,244,000 | 30,506,000 | 26,945,000 |
Loss on debt extinguishment | 65,000 | 1,868,000 | 65,000 | 15,308,000 |
Total losses and expenses | 82,696,000 | 98,295,000 | 169,619,000 | 253,186,000 |
Income before tax | 180,616,000 | 165,239,000 | 354,573,000 | 268,927,000 |
Provision for income taxes | 61,994,000 | 56,018,000 | 146,153,000 | 90,515,000 |
Net income | $ 118,622,000 | $ 109,221,000 | $ 208,420,000 | $ 178,412,000 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.32 | $ 0.32 | $ 0.59 | $ 0.52 |
Diluted (in dollars per share) | $ 0.31 | $ 0.26 | $ 0.55 | $ 0.43 |
Weighted average common shares outstanding - basic (in shares) | 366,918 | 340,678 | 354,035 | 340,411 |
Weighted average common shares outstanding - diluted (in shares) | 394,470 | 446,139 | 398,302 | 450,354 |
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- Definition Amount of written premiums assumed from other entities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The total amount of expense recognized during the period for future policy benefits, claims and claims adjustment costs, and for selling, general and administrative costs. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount of written premiums ceded to other entities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of amortization expense (reversal of expense) for deferred policy acquisition costs. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, before premiums ceded to other entities and premiums assumed by the entity, of premiums written. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition The amount of net income (loss) for the period per each share of common stock or unit outstanding during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The amount of net income (loss) for the period available to each share of common stock or common unit outstanding during the reporting period and to each share or unit that would have been outstanding assuming the issuance of common shares or units for all dilutive potential common shares or units outstanding during the reporting period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition This item represents the net total realized and unrealized gain (loss) included in earnings for the period as a result of selling or holding marketable securities categorized as trading, available-for-sale, or held-to-maturity, including the unrealized holding gain (loss) of held-to-maturity securities transferred to the trading security category and the cumulative unrealized gain (loss) which was included in other comprehensive income (a separate component of shareholders' equity) for available-for-sale securities transferred to trading securities during the period. Additionally, this item would include any gains (losses) realized during the period from the sale of investments accounted for under the cost method of accounting and losses recognized for other than temporary impairments (OTTI) of the subject investments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Difference between the fair value of payments made and the carrying amount of debt which is extinguished prior to maturity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of income (loss) from continuing operations before deduction of income tax expense (benefit) and income (loss) attributable to noncontrolling interest, and addition of income (loss) from equity method investments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after premiums ceded to other entities and premiums assumed by the entity, of decrease (increase) in unearned premiums. No definition available.
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- Definition Amount, after effect of policies assumed or ceded, of expense related to provision for policy benefits and costs incurred for property and casualty insurance contracts. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of the cost of borrowed funds accounted for as interest expense for debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after investment expense, of income earned from investments in securities and real estate. Includes, but is not limited to, real estate investment, policy loans, dividends, and interest. Excludes realized gain (loss) on investments. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of revenue and income classified as other. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Costs incurred during the period, such as those relating to general administration and policy maintenance that do not vary with and are not primarily related to the acquisition or renewal of insurance contracts. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after premiums ceded to other entities and premiums assumed by the entity, of property and casualty premiums earned. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount, after premiums ceded to other entities and premiums assumed by the entity, of premiums written. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of revenue recognized from goods sold, services rendered, insurance premiums, or other activities that constitute an earning process. Includes, but is not limited to, investment and interest income before deduction of interest expense when recognized as a component of revenue, and sales and trading gain (loss). Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The average number of shares or units issued and outstanding that are used in calculating diluted EPS or earnings per unit (EPU), determined based on the timing of issuance of shares or units in the period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Number of [basic] shares or units, after adjustment for contingently issuable shares or units and other shares or units not deemed outstanding, determined by relating the portion of time within a reporting period that common shares or units have been outstanding to the total time in that period. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2017 |
Jun. 30, 2016 |
Jun. 30, 2017 |
Jun. 30, 2016 |
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Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 118,622 | $ 109,221 | $ 208,420 | $ 178,412 |
Other comprehensive (loss) income, net of tax: | ||||
Change in unrealized investment gains and losses | 25,749 | 56,338 | 37,870 | 107,165 |
Benefit plan adjustments | (142) | (173) | (295) | (481) |
Foreign currency translation adjustment | 0 | 11 | 31 | (964) |
Other comprehensive income, net of tax | 25,607 | 56,176 | 37,606 | 105,720 |
Comprehensive income | $ 144,229 | $ 165,397 | $ 246,026 | $ 284,132 |
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- Definition Amount after tax of increase (decrease) in equity from transactions and other events and circumstances from net income and other comprehensive income, attributable to parent entity. Excludes changes in equity resulting from investments by owners and distributions to owners. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount after tax and reclassification adjustments, of appreciation (loss) in value of unsold available-for-sale securities, attributable to parent entity. Excludes amounts related to other than temporary impairment (OTTI) loss. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount, after tax and reclassification adjustment, of (increase) decrease in accumulated other comprehensive income for defined benefit plan, attributable to parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount after tax and reclassification adjustments of gain (loss) on foreign currency translation adjustments, foreign currency transactions designated and effective as economic hedges of a net investment in a foreign entity and intra-entity foreign currency transactions that are of a long-term-investment nature, attributable to parent entity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount after tax of other comprehensive income (loss) attributable to parent entity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- References No definition available.
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- Definition The amount of subsequent adjustments to additional paid in capital for convertible financial instruments where a component of equity and a component of debt are recognized. No definition available.
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- Definition Amount of increase to additional paid-in capital (APIC) from recognition of equity-based compensation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of increase in additional paid in capital (APIC) resulting from a tax benefit associated with share-based compensation plan other than an employee stock ownership plan (ESOP). Includes, but is not limited to, excess tax benefit. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition A roll forward is a reconciliation of a concept from the beginning of a period to the end of a period. No definition available.
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- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount after tax of other comprehensive income (loss) attributable to parent entity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The gross value of stock issued during the period upon the conversion of convertible securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Value of stock (or other type of equity) issued during the period as a result of any equity-based compensation plan other than an employee stock ownership plan (ESOP), net of stock value of such awards forfeited. Stock issued could result from the issuance of restricted stock, the exercise of stock options, stock issued under employee stock purchase plans, and/or other employee benefit plans. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Equity impact of the value of treasury stock (units) reissued during the period, excluding reissuance of shares (units) held in treasury used to satisfy equity-based compensation obligations exercised by the holders of such rights. Upon reissuance of shares (units) from treasury, either the common or preferred stock (unit) reissued is outstanding. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Total of all stockholders' equity (deficit) items, net of receivables from officers, directors, owners, and affiliates of the entity which are attributable to the parent. The amount of the economic entity's stockholders' equity attributable to the parent excludes the amount of stockholders' equity which is allocable to that ownership interest in subsidiary equity which is not attributable to the parent (noncontrolling interest, minority interest). This excludes temporary equity and is sometimes called permanent equity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Gain (Losses) On Extinguishment Of Debt, Cash Portion No definition available.
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- Definition The net change during the reporting period in the amount of profit commission receivable. No definition available.
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- Definition The net change during the reporting period in the amount of receivables currently due from reinsurers for ceded claims paid. No definition available.
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- Definition Payment Of Original Issue Discount, Convertible Junior Subordinated Debt No definition available.
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- Definition Payment Of Original Issue Discount Convertible Senior Notes No definition available.
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- Definition Purchase Of Convertible Junior Subordinated Debt No definition available.
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- References No definition available.
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- Definition Amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Excludes cash and cash equivalents within disposal group and discontinued operation. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of increase (decrease) in cash and cash equivalents. Cash and cash equivalents are the amount of currency on hand as well as demand deposits with banks or financial institutions. Includes other kinds of accounts that have the general characteristics of demand deposits. Also includes short-term, highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates. Includes effect from exchange rate changes. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The aggregate net amount of depreciation, amortization, and accretion recognized during an accounting period. As a noncash item, the net amount is added back to net income when calculating cash provided by or used in operations using the indirect method. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The net gain (loss) realized from the sale, exchange, redemption, or retirement of securities, not separately or otherwise categorized as trading, available-for-sale, or held-to-maturity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Difference between the fair value of payments made and the carrying amount of debt which is extinguished prior to maturity. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The increase (decrease) during the reporting period in investment income that has been earned but not yet received in cash. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The increase (decrease) during the reporting period in receivables or payables that result from buying and selling securities for the firm's own account or from acting as an agent or intermediary in the sale of securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The increase (decrease) during the reporting period in the balance sheet value of capitalized sales costs that are associated with acquiring a new insurance customers. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The increase (decrease) during the reporting period in the amounts payable to taxing authorities for taxes that are based on the reporting entity's earnings, net of amounts receivable from taxing authorities for refunds of overpayments or recoveries of income taxes. No definition available.
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- Definition Amount of increase (decrease) in liability to reflect the estimated ultimate cost of settling claims relating to insured events that have occurred on or before the balance sheet date, whether or not reported to the insurer at that date. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount of increase (decrease) in insurance liabilities classified as other. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of increase (decrease) in operating assets after deduction of operating liabilities classified as other. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The change in the premium receivable balance on the balance sheet. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The change in prepaid reinsurance premiums recorded on the balance sheet, which is needed to adjust net income to arrive at net cash flows provided by or used in operations. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The increase (decrease) during the reporting period in the amount of benefits the ceding insurer expects to recover on insurance policies ceded to other insurance entities as of the balance sheet date for all guaranteed benefit types. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of increase (decrease) unearned premiums written. Excludes portion of unearned premiums amortized into income. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of cash inflow (outflow) from financing activities, including discontinued operations. Financing activity cash flows include obtaining resources from owners and providing them with a return on, and a return of, their investment; borrowing money and repaying amounts borrowed, or settling the obligation; and obtaining and paying for other resources obtained from creditors on long-term credit. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition Amount of cash inflow (outflow) from investing activities, including discontinued operations. Investing activity cash flows include making and collecting loans and acquiring and disposing of debt or equity instruments and property, plant, and equipment and other productive assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of cash inflow (outflow) from operating activities, including discontinued operations. Operating activity cash flows include transactions, adjustments, and changes in value not defined as investing or financing activities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition The portion of profit or loss for the period, net of income taxes, which is attributable to the parent. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash outflow paid to third parties in connection with debt origination, which will be amortized over the remaining maturity period of the associated long-term debt. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of cash outflow to satisfy an employee's income tax withholding obligation as part of a net-share settlement of a share-based award. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash outflow to acquire debt securities classified as available-for-sale securities, because they are not classified as either held-to-maturity securities or trading securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash outflow to acquire equity securities classified as available-for-sale securities, because they are not classified as trading securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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- Definition The cash outflow associated with the acquisition of long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale; includes cash outflows to pay for construction of self-constructed assets. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash inflow from a debt initially having maturity due after one year or beyond the operating cycle, if longer. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of cash inflow from contractual arrangement with the lender, including but not limited to, letter of credit, standby letter of credit and revolving credit arrangements. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash inflow associated with maturities (principal being due), prepayments and calls (requests of early payments) on securities not classified as either held-to-maturity securities or trading securities which are classified as available-for-sale securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash inflow associated with the sale of debt securities classified as available-for-sale securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash inflow associated with the sale of equity securities classified as available-for-sale securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition The cash outflow from the repayment of a long-term debt instrument which can be exchanged for a specified amount of another security, typically the entity's common stock, at the option of the issuer or the holder. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- Definition Amount of cash outflow for payment of an obligation from a lender, including but not limited to, letter of credit, standby letter of credit and revolving credit arrangements. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Nature of Business and Basis of Presentation |
6 Months Ended |
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Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Business and Basis of Presentation | Nature of Business and Basis of Presentation MGIC Investment Corporation is a holding company which, through Mortgage Guaranty Insurance Corporation (“MGIC”) is principally engaged in the mortgage insurance business. We provide mortgage insurance to lenders throughout the United States and to government sponsored entities (“GSEs”) to protect against loss from defaults on low down payment residential mortgage loans. The accompanying unaudited consolidated financial statements of MGIC Investment Corporation and its wholly-owned subsidiaries have been prepared in accordance with the instructions to Form 10-Q as prescribed by the Securities and Exchange Commission (“SEC”) for interim reporting and do not include all of the other information and disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). These statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended December 31, 2016 included in our Annual Report on Form 10-K. As used below, “we,” “our” and “us” refer to MGIC Investment Corporation’s consolidated operations or to MGIC Investment Corporation, as the context requires. In the opinion of management the accompanying financial statements include all adjustments, consisting primarily of normal recurring accruals, necessary to fairly state our consolidated financial position and consolidated results of operations for the periods indicated. The consolidated results of operations for the interim period may not be indicative of the results that may be expected for the year ending December 31, 2017. Substantially all of our insurance written since 2008 has been for loans purchased by the GSEs. We operate under the Private Mortgage Insurer Eligibility Requirements ("PMIERs") of the GSEs that became effective December 31, 2015 and have been amended from time to time. The financial requirements of the PMIERs require a mortgage insurer’s "Available Assets" (generally only the most liquid assets of an insurer) to equal or exceed its "Minimum Required Assets" (which are based on an insurer's book and are calculated from tables of factors with several risk dimensions and are subject to a floor amount). Based on our interpretation of the PMIERs, as of June 30, 2017, MGIC’s Available Assets are in excess of its Minimum Required Assets; and MGIC is in compliance with the financial requirements of the PMIERs and eligible to insure loans purchased by the GSEs. Reclassifications Certain reclassifications to 2016 amounts have been made in the accompanying financial statements to conform to the 2017 presentation. Subsequent events We have considered subsequent events through the date of this filing. |
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- References No definition available.
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- Definition The entire disclosure for organization, consolidation and basis of presentation of financial statements disclosure. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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New Accounting Pronouncements |
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Jun. 30, 2017 | |||||||||||||||||
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |||||||||||||||||
New Accounting Pronouncements | New Accounting Pronouncements Adopted Accounting Standards Improvements to Employee Share-Based Compensation Accounting In March 2016, the Financial Accounting Standards Board (“FASB”) issued updated guidance that simplifies several aspects of the accounting for employee share-based compensation including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification of related amounts within the statement of cash flows. The updated guidance requires that, prospectively, all tax effects related to share-based compensation be made through the statement of operations at the time of settlement. In contrast, the previous guidance required excess tax benefits to be recognized in paid-in capital. The updated guidance also removes the requirement to delay recognition of a tax benefit until it reduces current taxes payable. This change is required to be applied on a modified retrospective basis, with a cumulative effect adjustment to opening retained earnings. Additionally, all tax related cash flows resulting from share-based compensation are to be reported as operating activities on the statement of cash flows, a change from the existing requirement to present tax benefits as an inflow from financing activities and an outflow from operating activities. Finally, for tax withholding purposes, entities will be allowed to withhold an amount of shares up to the employee’s maximum individual tax rate (as opposed to the minimum statutory tax rate) in the relevant jurisdiction without resulting in liability classification of the award. The change in tax withholding is to be applied on a modified retrospective approach. This updated guidance became effective January 1, 2017. We adopted this guidance in the first quarter of 2017 and as a result of the adoption:
Prospective Accounting Standards Stock Compensation - Scope of Modification Accounting In May 2017, the FASB issued updated guidance related to a change in the terms or conditions (modification) of a share-based award. The updated guidance provides that an entity should account for the effects of a modification unless the fair value and vesting conditions of the modified award and the classification of the award (equity or liability instrument) are the same as the original award immediately before the modification. The updated guidance addresses the current diversity in practice on applying modification accounting, as some entities evaluate whether changes to awards are substantive, which is not prescribed within the current accounting guidance. The updated guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. Early adoption is permitted, including adoption in any interim period. We are currently evaluating the impacts the adoption of this guidance will have on our consolidated financial statements, but do not expect it to have a material impact on our consolidated financial statements or disclosures. Premium Amortization on Purchased Callable Debt Securities In March 2017, the FASB issued updated guidance to amend the amortization period for certain purchased callable debt securities held at a premium shortening the amortization period to the earliest call date. Under current GAAP, there is diversity in practice in the amortization period for premiums of callable debt securities and in how the potential for exercise of a call is factored into current impairment assessments. This updated guidance aligns with how callable debt securities, in the United States, are generally quoted, priced, and traded assuming a model that incorporates consideration of calls (also referred to as “yield-to-worst” pricing). The updated guidance is effective for annual periods beginning after December 15, 2018, including interim periods within those annual periods. We are currently evaluating the impacts the adoption of this guidance will have on our consolidated financial statements, but do not expect it to have a material impact on our consolidated financial statements or disclosures. We currently account for premium amortization on our purchased callable debt securities on a yield-to-worst basis, which generally aligns with the earliest call date. Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost In March 2017, the FASB issued updated guidance that improves the reporting of net benefit cost in the financial statements. The updated guidance requires that an employer report the service cost component in the same financial statement caption as other compensation costs arising from services rendered by employees during the period. The other components of net benefit cost are required to be presented in the statement of operations separately from the service cost component and outside a subtotal of income from operations, if one is presented. Current guidance does not prescribe where the amount of net benefit cost should be presented in an employer’s statement of operations and does not require entities to disclose by line item the amount of net benefit cost that is included in the statement of operations. The updated guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods. We are currently evaluating the impacts the adoption of this guidance will have on our consolidated financial statements, but do not expect it to have a material impact on our consolidated financial statements or disclosures. Measurement of Credit Losses on Financial Instruments In June 2016, the FASB issued updated guidance that requires immediate recognition of estimated credit losses expected to occur over the remaining life of many financial instruments. Entities will be required to utilize a current expected credit losses (“CECL”) methodology that incorporates their forecasts of future economic conditions into their loss estimate unless such forecast is not reasonable and supportable, in which case the entity will revert to historical loss experience. Any allowance for CECL reduces the amortized cost basis of the financial instrument to the amount an entity expects to collect. Credit losses relating to available-for-sale fixed maturity securities are to be recorded through an allowance for credit losses, rather than a write-down of the asset, with the amount of the allowance limited to the amount by which fair value is less than amortized cost. In addition, the length of time a security has been in an unrealized loss position will no longer impact the determination of whether a credit loss exists. The updated guidance is not prescriptive about certain aspects of estimating expected credit losses, including the specific methodology to use, and therefore will require significant judgment in application. The updated guidance is effective for annual periods beginning after December 15, 2019, including interim periods within those annual periods. Early adoption is permitted for annual and interim periods in fiscal years beginning after December 15, 2018. We are currently evaluating the impacts the adoption of this guidance will have on our consolidated financial statements, but do not expect it to have a material impact on our consolidated financial statements or disclosures. Recognition and Measurement of Financial Assets and Financial Liabilities In January 2016, the FASB issued updated guidance to address the recognition, measurement, presentation, and disclosure of certain financial instruments. The updated guidance requires equity investments, except those accounted for under the equity method of accounting, that have a readily determinable fair value to be measured at fair value with changes in fair value recognized in net income. Equity investments that do not have readily determinable fair values may be remeasured at fair value either upon the occurrence of an observable price change or upon identification of an impairment. A qualitative assessment for impairment is required for equity investments without readily determinable fair values. The updated guidance also eliminates the requirement to disclose the method and significant assumptions used to estimate the fair value of financial instruments measured at amortized cost on the balance sheet. Further, the updated guidance clarifies that entities should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entities other deferred tax assets. The updated guidance is effective for annual periods beginning after December 15, 2017, including interim periods within those annual periods and will require recognition of a cumulative effect adjustment at adoption. We do not currently expect the adoption of this guidance to impact our consolidated financial position or liquidity. |
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- Definition The entire disclosure for a new accounting pronouncement that has been issued but not yet adopted. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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- References No definition available.
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Debt |
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Debt | Debt 2017 debt transactions 2% Notes On March 21, 2017, we issued an irrevocable notice of redemption in respect of our outstanding 2% Notes, with a redemption date of April 21, 2017. In April, holders of approximately $202.5 million of the outstanding principal exercised their rights to convert their notes into shares of our common stock. The remaining $5.1 million of outstanding principal was redeemed for cash. The conversions of the 2% Notes at a rate of 143.8332 shares per $1,000 principal amount resulted in the issuance of approximately 29.1 million shares of our common stock in April. The conversions and cash redemption eliminated our debt obligation. A loss on debt extinguishment of $0.07 million was recognized on the redemption of the $5.1 million of 2% Notes. No gain or loss was recognized from the conversions as the outstanding debt issuance costs associated with the conversions are included in the debt carrying value, which was credited to shareholders’ equity at the time of conversion. Credit Facility On March 21, 2017, we entered into a Credit Agreement with various lenders which provides for a $175 million unsecured revolving credit facility maturing on March 21, 2020. Revolving credit borrowings bear interest at a floating rate, which will be, at our option, either a eurocurrency rate or a base rate, in each case plus an applicable margin. The applicable margins are subject to adjustment based on our senior unsecured long-term debt rating, or if we do not have such a rating, our corporate or issuer rating. Amounts under the facility may be borrowed, repaid and reborrowed from time to time until the maturity of the revolving credit facility. Voluntary prepayments and commitment reductions are permitted at any time without fee subject to a minimum dollar requirement and, for outstanding eurocurrency loans, customary breakage costs. We are required under the Credit Agreement to pay commitment fees on the average daily amount of the unused revolving commitments of the lenders, and an annual administrative fee to the administrative agent. The Credit Agreement contains affirmative, negative and financial covenants which are customary for financings of this type, including, among other things, limits on the creation of liens, limits on the incurrence of indebtedness, restrictions on dispositions, maximum debt-to-capital ratio, minimum consolidated stockholders' equity, minimum policyholder's position of MGIC, and compliance with the financial requirements of the PMIERs. The Credit Agreement includes customary events of default for facilities of this type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default, payments of all outstanding loans may be accelerated and/or the lenders' commitments may be terminated. Upon the occurrence of certain insolvency or bankruptcy related events of default, all amounts payable under the Credit Agreements shall automatically become immediately due and payable, and the lenders' commitments will automatically terminate. In addition, upon the occurrence of certain insolvency or bankruptcy related events of default, or the failure to pay interest, principal or fees, the interest rates on all outstanding obligations will be increased. In March, we borrowed $150 million under the revolving credit facility, to fund a portion of the redemption price of the 2% Notes if holders did not elect to convert their 2% Notes. In April, we repaid the amount borrowed under the revolving credit facility because most holders elected to convert their notes. Costs incurred to enter into the Credit Agreement have been deferred and recorded as Other assets and will be amortized over the term of the Credit Agreement. 5% Notes On May 1, 2017, our 5% Notes due in 2017 (“5% Notes”) matured and we repaid the outstanding $145 million in aggregate par value, plus accrued interest with cash at our holding company. First half 2016 debt transactions 5% Notes During the first six months of 2016, we purchased $188.5 million in aggregate par value of our 5% Notes at an aggregate purchase price of $195.5 million for which we recognized losses on debt extinguishment on our consolidated statements of operations for the three and six months ended June 30, 2016. 9% Debentures In February 2016, MGIC purchased $132.7 million in aggregate par value of our 9% Debentures at a purchase price of $150.7 million. The purchase of the 9% Debentures resulted in an $8.3 million loss on debt extinguishment on the consolidated statement of operations for the six months ended June 30, 2016, which represents the difference between the fair value and the carrying value of the liability component on the purchase date. Our shareholders’ equity was separately reduced by $6.3 million related to the reacquisition of the equity component. For GAAP accounting purposes, the 9% Debentures owned by MGIC are considered retired and are eliminated in our consolidated financial statements and the underlying common stock equivalents, approximately 9.8 million shares, are not included in the computation of diluted shares. Debt obligations The par value of our long-term debt obligations and their aggregate carrying values as of June 30, 2017 and December 31, 2016 were as follows.
The 5.75% Senior Notes due 2023 (“5.75% Notes”) and 9% Convertible Junior Subordinated Debentures due in 2063 (“9% Debentures”) are obligations of our holding company, MGIC Investment Corporation, and not of its subsidiaries. The Federal Home Loan Bank Advance (the “FHLB Advance”) is an obligation of MGIC. Interest payments on our debt obligations appear below.
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- References No definition available.
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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Reinsurance |
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Reinsurance Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance | Reinsurance The reinsurance agreements we have entered into are discussed below. The effect of all of our reinsurance agreements on premiums earned and losses incurred is as follows:
Quota share reinsurance In March 2017, we entered into a quota share reinsurance agreement (“2017 QSR Transaction”) with an effective date of January 1, 2017 with a group of unaffiliated reinsurers, each with a financial strength rating of A- or better by Standard and Poor’s, A.M. Best or both. We utilize quota share reinsurance to manage our exposure to losses resulting from our mortgage guaranty insurance policies and to provide reinsurance capital credit under the PMIERs. Our 2017 QSR Transaction provides coverage on new business written January 1, 2017 through December 29, 2017 that meets certain eligibility requirements. Under the agreement we cede losses incurred and premiums on or after the effective date through December 31, 2028, at which time the agreement expires. Early termination of the agreement can be elected by us effective December 31, 2021 for a fee, or under specified scenarios for no fee upon prior written notice including if we will receive less than 90% of the full credit amount under the PMIERs for the risk ceded in any required calculation period. Our 2015 quota share reinsurance agreement (“2015 QSR Transaction”), which became effective on July 1, 2015, covers eligible risk in force written before 2017. The group of unaffiliated reinsurers under our 2015 QSR Transaction each has an insurer financial strength rating of A- or better by Standard and Poor’s Rating Services, A.M. Best or both. The 2015 QSR Transaction cedes losses incurred and premiums through December 31, 2024, at which time the agreement expires. Early termination of the agreement can be elected by us effective December 31, 2018 for a fee, or under specified scenarios for no fee upon prior written notice, including if we will receive less than 90% of the full credit amount under the PMIERs for the risk ceded in any required calculation period. The structure of both the 2017 QSR Transaction and 2015 QSR Transaction is a 30% quota share for all policies covered, with a 20% ceding commission as well as a profit commission. Generally, under the QSR Transactions, we will receive a profit commission provided that the loss ratio on the loans covered under the agreement remains below 60%. Following is a summary of our quota share reinsurance agreements, excluding captive agreements discussed below, for the three and six months ended June 30, 2017 and 2016.
Under the terms of QSR Transactions, ceded premiums, ceding commission and profit commission are settled net on a quarterly basis. The ceded premium due after deducting the related ceding commission and profit commission is reported within “Other liabilities” on the consolidated balance sheets. The reinsurance recoverable on loss reserves related to our QSR Transactions was $33.1 million as of June 30, 2017 and $31.8 million as of December 31, 2016. The reinsurance recoverable balance is secured by funds on deposit from the reinsurers which are based on the funding requirements of PMIERs that address ceded risk. Captive reinsurance In the past, MGIC also obtained captive reinsurance. In a captive reinsurance arrangement, the reinsurer is affiliated with the lender for whom MGIC provides mortgage insurance. As part of our settlement with the Consumer Financial Protection Bureau (“CFPB”) in 2013 and with the Minnesota Department of Commerce in 2015, MGIC has agreed to not enter into any new captive reinsurance agreement or reinsure any new loans under any existing captive reinsurance agreement for a period of ten years subsequent to the respective settlements. In accordance with the CFPB settlement, all of our active captive arrangements were placed into run-off. In addition, the GSEs will not approve any future reinsurance or risk sharing transaction with a mortgage enterprise or an affiliate of a mortgage enterprise. The reinsurance recoverable on loss reserves related to captive agreements was $12.0 million as of June 30, 2017, which was supported by $86.0 million of trust assets, while as of December 31, 2016, the reinsurance recoverable on loss reserves related to captive agreements was $19.0 million, which was supported by $91.0 million of trust assets. Each captive reinsurer is required to maintain a separate trust account to support its combined reinsured risk on all annual books. MGIC is the sole beneficiary of the trusts. |
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- References No definition available.
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- Definition The entire disclosure pertaining to the existence, magnitude and information about insurance that has been ceded to or assumed from another insurance company, including the methodologies and assumptions used in determining recorded amounts. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Litigation and Contingencies |
6 Months Ended |
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Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation and Contingencies | Litigation and Contingencies Before paying an insurance claim, we review the loan and servicing files to determine the appropriateness of the claim amount. When reviewing the files, we may determine that we have the right to rescind coverage on the loan. In our SEC reports, we refer to insurance rescissions and denials of claims collectively as “rescissions” and variations of that term. In addition, all of our insurance policies provide that we can reduce or deny a claim if the servicer did not comply with its obligations under our insurance policy. We call such reduction of claims “curtailments.” In recent quarters, an immaterial percentage of claims received in a quarter have been resolved by rescissions. In each of 2016 and the first half of 2017, curtailments reduced our average claim paid by approximately 5.5%. Our loss reserving methodology incorporates our estimates of future rescissions, curtailments, and reversals of rescissions and curtailments. A variance between ultimate actual rescission, curtailment and reversal rates and our estimates, as a result of the outcome of litigation, settlements or other factors, could materially affect our losses. When the insured disputes our right to rescind coverage or curtail claims, we generally engage in discussions in an attempt to settle the dispute. If we are unable to reach a settlement, the outcome of a dispute ultimately would be determined by legal proceedings. Under ASC 450-20, until a liability associated with settlement discussions or legal proceedings becomes probable and can be reasonably estimated, we consider our claim payment or rescission resolved for financial reporting purposes and do not accrue an estimated loss. Where we have determined that a loss is probable and can be reasonably estimated, we have recorded our best estimate of our probable loss. If we are not able to implement settlements we consider probable, we intend to defend MGIC vigorously against any related legal proceedings. In addition to matters for which we have recorded a probable loss, we are involved in other discussions and/or proceedings with insureds with respect to our claims paying practices. Although it is reasonably possible that when these matters are resolved we will not prevail in all cases, we are unable to make a reasonable estimate or range of estimates of the potential liability. We estimate the maximum exposure associated with matters where a loss is reasonably possible to be approximately $291 million, although we believe (but can give no assurance that) we will ultimately resolve these matters for significantly less than this amount. This estimate of our maximum exposure does not include interest or consequential or exemplary damages. Mortgage insurers, including MGIC, have been involved in litigation and regulatory actions related to alleged violations of the anti-referral fee provisions of the Real Estate Settlement Procedures Act, which is commonly known as RESPA, and the notice provisions of the Fair Credit Reporting Act, which is commonly known as FCRA. While these proceedings in the aggregate have not resulted in material liability for MGIC, there can be no assurance that the outcome of future proceedings, if any, under these laws would not have a material adverse affect on us. In addition, various regulators, including the CFPB, state insurance commissioners and state attorneys general may bring other actions seeking various forms of relief in connection with alleged violations of RESPA. The insurance law provisions of many states prohibit paying for the referral of insurance business and provide various mechanisms to enforce this prohibition. While we believe our practices are in conformity with applicable laws and regulations, it is not possible to predict the eventual scope, duration or outcome of any such reviews or investigations nor is it possible to predict their effect on us or the mortgage insurance industry. Through a non-insurance subsidiary, we utilize our underwriting skills to provide an outsourced underwriting service to our customers known as contract underwriting. As part of the contract underwriting activities, that subsidiary is responsible for the quality of the underwriting decisions in accordance with the terms of the contract underwriting agreements with customers. That subsidiary may be required to provide certain remedies to its customers if certain standards relating to the quality of our underwriting work are not met, and we have an established reserve for such future obligations. Claims for remedies may be made a number of years after the underwriting work was performed. The underwriting remedy expense for 2016 and the first half of 2017 was immaterial to our consolidated financial statements. In addition to the matters described above, we are involved in other legal proceedings in the ordinary course of business. In our opinion, based on the facts known at this time, the ultimate resolution of these ordinary course legal proceedings will not have a material adverse effect on our financial position or results of operations. See Note 11 – “Income Taxes” for a description of federal income tax contingencies. |
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- References No definition available.
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- Definition The entire disclosure for legal proceedings, legal contingencies, litigation, regulatory and environmental matters and other contingencies. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Earnings per Share |
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Earnings Per Share [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings per Share | Earnings per Share Basic earnings per share (“EPS”) is calculated by dividing net income by the weighted average number of shares of common stock outstanding. Diluted EPS includes the components of basic EPS and also gives effect to dilutive common stock equivalents. We calculate diluted EPS using the treasury stock method and if-converted method. Under the if-converted method, diluted EPS reflects the potential dilution that could occur if our convertible debt instruments result in the issuance of common stock. The determination of potentially issuable shares does not consider the satisfaction of the conversion requirements and the shares are included in the determination of diluted EPS as of the beginning of the period, if dilutive. During the quarter ended June 30, 2017, we had several debt issuances that could result in contingently issuable shares and consider each potential issuance of shares separately to reflect the maximum potential dilution. Nonetheless, our dilutive common stock equivalents may not reflect all of the contingently issuable shares that could be required to be issued upon any debt conversion. For purposes of calculating basic and diluted EPS, vested restricted stock and restricted stock units ("RSUs") are considered outstanding. The following table reconciles the numerators and denominators used to calculate basic and diluted EPS.
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- References No definition available.
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- Definition The entire disclosure for earnings per share. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Investments |
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Investments [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at June 30, 2017 and December 31, 2016 are shown below.
The FHLB Advance is secured by eligible collateral whose fair value must be maintained at 102% of the outstanding principal balance. As of June 30, 2017 that collateral is included in our total investment portfolio amount shown above with a total fair value of $165.9 million. The amortized cost and fair values of debt securities at June 30, 2017, by contractual maturity, are shown in the following table. 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. Because most asset-backed and mortgage-backed securities and collateralized loan obligations provide for periodic payments throughout their lives, they are listed in separate categories.
At June 30, 2017 and December 31, 2016, the investment portfolio had gross unrealized losses of $31.8 million and $60.6 million, respectively. For those securities in an unrealized loss position, the length of time the securities were in such a position, as measured by their month-end fair values, is as follows:
The unrealized losses in all categories of our investments at June 30, 2017 and December 31, 2016 were primarily caused by the difference in interest rates at each respective period, compared to interest rates at the time of purchase. There were 404 and 607 securities in an unrealized loss position at June 30, 2017 and December 31, 2016, respectively. During each of the three and six months ended June 30, 2017 and 2016 there were no other-than-temporary impairments (“OTTI”) recognized. The net realized investment gains (losses) on the investment portfolio are as follows:
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- References No definition available.
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- Definition The entire disclosure for investments in certain debt and equity securities. Reference 1: http://www.xbrl.org/2003/role/presentationRef
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Fair Value Measurements |
6 Months Ended |
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Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements Under the authoritative guidance, fair value is disclosed using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value and categorizes assets and liabilities into Levels 1, 2, and 3 based on inputs available to determine their fair values. To determine the fair value of securities available-for-sale in Level 1 and Level 2 of the fair value hierarchy, independent pricing sources have been utilized. One price is provided per security based on observable market data. To ensure securities are appropriately classified in the fair value hierarchy, we review the pricing techniques and methodologies of the independent pricing sources and believe that their policies adequately consider market activity, either based on specific transactions for the issue valued or based on modeling of securities with similar credit quality, duration, yield and structure that were recently traded. A variety of inputs are utilized by the independent pricing sources including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer spreads, two sided markets, benchmark securities, bids, offers and reference data including data published in market research publications. Inputs may be weighted differently for any security, and not all inputs are used for each security evaluation. Market indicators, industry and economic events are also considered. This information is evaluated using a multidimensional pricing model. This model combines all inputs to arrive at a value assigned to each security. Quality controls are performed by the independent pricing sources throughout this process, which include reviewing tolerance reports, trading information, data changes, and directional moves compared to market moves. In addition, on a quarterly basis, we perform quality controls over values received from the pricing sources which also includes reviewing tolerance reports, trading information, data changes, and directional moves compared to market moves. We have not made any adjustments to the prices obtained from the independent pricing sources. In accordance with fair value accounting guidance, we applied the following fair value hierarchy in order to measure fair value for assets and liabilities: Level 1 - Quoted prices for identical instruments in active markets that we can access. Financial assets utilizing Level 1 inputs primarily include U.S. Treasury securities and equity securities. Level 2 - Quoted prices for similar instruments in active markets that we can access; quoted prices for identical or similar instruments in markets that are not active; and inputs, other than quoted prices, that are observable in the marketplace for the instrument. The observable inputs are used in valuation models to calculate the fair value of the instruments. Financial assets utilizing Level 2 inputs primarily include obligations of U.S. government corporations and agencies, corporate bonds, mortgage-backed securities, asset-backed securities, and most municipal bonds. The independent pricing sources utilize these approaches to determine the fair value of the instruments in Level 2 of the fair value hierarchy based on type of instrument: Corporate Debt & U.S. Government and Agency Bonds are evaluated by surveying the dealer community, obtaining relevant trade data, benchmark quotes and spreads and incorporating this information into the evaluation process. Obligations of U.S. States & Political Subdivisions are evaluated by tracking, capturing, and analyzing quotes for active issues and trades reported via the Municipal Securities Rulemaking Board records. Daily briefings and reviews of current economic conditions, trading levels, spread relationships, and the slope of the yield curve provide further data for evaluation. Residential Mortgage-Backed Securities (“RMBS”) are evaluated by monitoring interest rate movements, and other pertinent data daily. Incoming market data is enriched to derive spread, yield and/or price data as appropriate, enabling known data points to be extra |