| Comprehensive Income | 7. Comprehensive Income
Comprehensive income is comprised of net income and other comprehensive income. Other comprehensive income includes the unrealized investment gains or losses on securities available for sale (net of adjustments for realized investment gains or losses) net of adjustments to DAC, VOBA and policyholder account balances. In addition, other comprehensive income includes the change in the liability for benefit plan obligations. Other comprehensive income reflects these items net of tax.
The table below provides information about comprehensive income for the third quarters and nine months ended September 30, 2011 and 2010.
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Quarter Ended
September 30 |
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Nine Months Ended
September 30 |
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2011 |
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2010 |
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2011 |
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2010 |
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Net unrealized gains (losses) arising during the year |
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$ |
57,584 |
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$ |
68,150 |
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$ |
96,657 |
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$ |
182,371 |
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Less: |
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Net realized investment gains (losses), excluding impairment losses |
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204 |
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299 |
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3,337 |
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2,934 |
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Other-than-temporary impairment losses recognized in earnings |
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(167 |
) |
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(1,080 |
) |
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(674 |
) |
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(4,129 |
) |
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Other-than-temporary impairment losses recognized in other comprehensive income |
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17 |
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170 |
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131 |
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309 |
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Net unrealized gains (losses) excluding impairment losses |
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57,530 |
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68,761 |
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93,863 |
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183,257 |
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Effect on DAC and VOBA |
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(20,189 |
) |
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(22,405 |
) |
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(27,019 |
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(57,306 |
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Policyholder account balances |
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(6,089 |
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(6,948 |
) |
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(9,600 |
) |
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(15,598 |
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Deferred income taxes |
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(10,940 |
) |
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(13,792 |
) |
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(20,037 |
) |
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(38,623 |
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Other comprehensive income |
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20,312 |
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25,616 |
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37,207 |
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71,730 |
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Net income |
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4,466 |
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4,456 |
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20,430 |
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15,479 |
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Comprehensive income |
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$ |
24,778 |
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$ |
30,072 |
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$ |
57,637 |
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$ |
87,209 |
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The following table provides accumulated balances related to each component of accumulated other comprehensive income as of September 30, 2011.
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Net
Unrealized
Gain (Loss) on
Non-Impaired
Securities |
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Net
Unrealized
Gain (Loss) on
Impaired
Securities |
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Benefit
Plan
Obligations |
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DAC/
VOBA
Impact |
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Policyholder
Account
Balances |
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Tax Effect |
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Total |
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Beginning of year |
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$ |
122,422 |
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$ |
(12,231 |
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$ |
(55,980 |
) |
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$ |
(35,538 |
) |
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$ |
(7,430 |
) |
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$ |
(3,436 |
) |
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$ |
7,807 |
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Other comprehensive income |
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93,774 |
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89 |
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- |
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(27,019 |
) |
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(9,600 |
) |
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(20,037 |
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37,207 |
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End of period |
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$ |
216,196 |
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$ |
(12,142 |
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$ |
(55,980 |
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$ |
(62,557 |
) |
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$ |
(17,030 |
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$ |
(23,473 |
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$ |
45,014 |
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