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ASSURANT, INC.2011 Form10-K F-15
4 Investments
In October 2010, the FASB issued amendments to existing guidance
on accounting for costs associated with acquiring or renewing insurance
contracts.  e amendments modify the de nition of the types of costs
incurred by insurance entities that can be capitalized in the acquisition
of new and renewal contracts. Under this amended guidance, acquisition
costs are de ned as costs that are directly related to the successful
acquisition of new or renewal insurance contracts.  e amendments
are e ective for  scal years, and interim periods within those  scal
years, beginning after December15, 2011.  erefore, the Company
is required to adopt this guidance on January1, 2012. Prospective
application as of the date of adoption is required; however, retrospective
application to all prior periods presented upon the date of adoption is
permitted, but not required.  e Company has chosen to adopt the
guidance retrospectively.  is will result in a reduction in our deferred
acquisition cost asset. It will also cause an increase in our liability for
future policy bene ts and expenses for certain preneed policies whose
reserves are calculated utilizing deferred acquisition costs.  ere will also
be a decrease in the amortization associated with the previously deferred
acquisition costs. We are evaluating the full e ects of implementing
the amended guidance, but we currently estimate that the cumulative
e ect adjustment that will result from our retrospective adoption will
reduce the opening balance of stockholders’ equity between $140,000
and $150,000 in the year of adoption, net of the related tax bene t.
is estimate is preliminary in nature and the actual amount of the
reduction may be above or below the range. We currently estimate
the adoption of these amendments will result in immaterial changes
in net income in 2011 and in the years preceding 2011 to which the
retrospective adoption will be applied.  e amendments are generally
more restrictive with regard to which costs can be deferred and may
impact the pattern of reported income for certain products. Due to our
overall mix of business we do not currently expect the amendments to
cause material changes to net income.
3. Business Combinations
On June21, 2011, in an all cash transaction, the Company acquired the
SureDeposit business, the leading provider of security deposit alternatives
to the multifamily housing industry, for $45,080. In connection with
the acquisition, the Company recorded $25,350 of intangible assets,
all of which are amortizable, and $19,608 of goodwill.  e primary
factor contributing to the recognition of goodwill is the future expected
growth of this business.  is acquisition expands the multifamily housing
product o ering and associated cross-selling opportunities with existing
clients for the Assurant Specialty Property segment.
ere were three acquisitions made in 2010 that individually and in
the aggregate were immaterial.
On October1, 2009, the Company acquired, through a reinsurance
agreement, a block of business from Shenandoah Life Insurance
Company (“Shenandoah”).  e Company assumed, on a coinsurance
basis, 100% of the group life, disability, dental and vision insurance
business in-force with Shenandoah.  ere were no goodwill or intangible
assets associated with this agreement.
4. Investments
e following tables show the cost or amortized cost, gross unrealized gains and losses and fair value and OTTI of our  xed maturity and equity
securities as of the dates indicated:
December31, 2011
Cost or Amortized
Cost
Gross Unrealized
Gains
Gross Unrealized
Losses Fair Value OTTI in AOCI
Fixed maturity securities:
United States Government and government agencies
and authorities $ 148,379 $ 8,987 $ (26) $ 157,340 $ —
States, municipalities and political subdivisions 832,788 96,536 (301) 929,023 —
Foreign governments 647,133 78,148 (1,368) 723,913 —
Asset-backed 30,681 2,072 (320) 32,433 1,118
Commercial mortgage-backed 82,184 5,840 — 88,024 —
Residential mortgage-backed 841,488 56,364 (633) 897,219 8,240
Corporate 7,540,776 882,628 (58,757) 8,364,647 14,313
TOTAL FIXED MATURITY SECURITIES $ 10,123,429 $ 1,130,575 $ 61,405 $ 11,192,599 $ 23,671
Equity securities:
Common stocks $ 14,037 $ 2,018 $ (54) $ 16,001 $ —
Non-redeemable preferred stocks 343,374 28,141 (25,140) 346,375 —
TOTAL EQUITY SECURITIES $ 357,411 $ 30,159 $ 25,194 $ 362,376 $