During 2019, White Mountains deployed approximately $435 million in new business opportunities. Also during 2019, White Mountains repurchased and retired $5 million of its common shares and ended the year with approximately $1.0 billion of undeployed capital.
Adjusted book value per share $ 1,263.64 $ 1,018.41 $ 887.85
Net investment income - BAM Surplus Notes 18.8 - (18.8) -
Total pricing, which reflects both gross written premiums and MSC from new business, decreased to 76 basis points in 2020, compared to 83 basis points in 2019. See “NON-GAAP FINANCIAL MEASURES” on page 63. The mix of business impacted 2020 total pricing as BAM wrote proportionally more lower-priced primary business and less higher-priced secondary market and assumed reinsurance business. Additionally, during 2020 BAM wrote more higher credit quality business, which can pressure absolute pricing but, at the same time, improve risk-adjusted pricing. Pricing in the primary market increased to 59 basis points in 2020, compared to 51 basis points in 2019, driven primarily by increased demand for insurance and wider credit spreads as a result of the COVID-19 pandemic. Pricing in the secondary and assumed reinsurance markets, which is more transaction-specific than pricing in the primary market, decreased to 197 basis points in 2020, compared to 219 basis points in 2019.
As of December 31, 2020, White Mountains’s debt service model indicated that the BAM Surplus Notes would be fully repaid between six and seven years prior to final maturity, which is generally consistent with the results of the update of the debt service model as of December 31, 2019. The debt service model assumes both par insured and total pricing gradually increase from 2021 to 2024, and flatten thereafter.
HG Global/BAM Results-Year Ended December 31, 2019 versus Year Ended December 31, 2018
Gross written premiums and MSC collected in the HG Global/BAM segment totaled $107 million in both 2019 and 2018. BAM insured $12.8 billion of municipal bonds, $10.4 billion of which were in the primary market, in 2019, compared to $12 billion of municipal bonds, $8.8 billion of which were in the primary market, in 2018. During 2019 and 2018, BAM completed assumed reinsurance transactions to insure municipal bonds with a par value of $1.1 billion and $2.2 billion, respectively.
Accrued interest receivable on BAM Surplus Notes 155.7 - (155.7) -
Total liabilities and equity $ 1,060.6 $ 560.0 $ (602.8) $ 1,017.8
Specialty Transportation: NSM’s specialty transportation controlled premium and commission and other revenues increased 7% and 10% in 2020, compared to 2019, driven primarily by rate increases and new business unit growth in the collector car and tow truck markets.
Social Services: NSM’s social services controlled premium and commission and other revenues both increased 9% in 2019, compared to 2018, driven primarily by rate increases and higher retention.
For the year ended December 31, 2020, White Mountains repurchased and retired 99,087 of its common shares for $85 million.
White Mountains’s portfolio of other long-term investments was $676 million and $326 million as of December 31, 2019 and 2018. White Mountains other long-term investments portfolio returned 6.1% in 2019. Investment returns for 2019 were driven primarily by net investment income from Kudu’s Participation Contracts and a $15 million increase in the fair value of White Mountains’s investment in PassportCard/DavidShield resulting from increases in profitability metrics in its core businesses, partially offset by losses from certain unconsolidated entities. White Mountains’s other long-term investments portfolio returned 10.0% in 2018. Investment results for 2018 were driven primarily by a $26 million increase in the fair value of White Mountains’s investment in PassportCard/DavidShield resulting from increases in profitability metrics in its core businesses, as well as strong private equity fund returns.
White Mountains also has future binding commitments to fund certain other long-term investments. These commitments, which totaled approximately $298 million as of December 31, 2020, do not have fixed funding dates and, are therefore, excluded from the table above.
During 2019, NSM borrowed $43 million of term loans under the NSM Bank Facility, which included $20 million and $23 million to fund the acquisitions of Embrace and the Renewal Rights from AIG, and $7 million of revolving credit loans. Additionally, during 2019 NSM repaid $2 million of term loans and $7 million of revolving credit loans under the NSM Bank Facility.
Total consolidated portfolio returns excluding MediaAlpha are non-GAAP financial measures that remove net investment income and net realized and unrealized investment gains from White Mountains’s investment in MediaAlpha during the twelve months ended December 31, 2020 and 2019. Subsequent to the 2019 MediaAlpha Transaction, White Mountains no longer consolidated MediaAlpha and accounted for its remaining investment in MediaAlpha at fair value. White Mountains believes these measures to be useful to management and investors by making the returns in the current period comparable to the prior periods. A reconciliation from GAAP to the reported percentages is as follows:
Periodically, White Mountains’s management reviews the recoverability of amounts recorded from the BAM Surplus Notes. As of December 31, 2020, White Mountains believes such notes and interest thereon to be fully recoverable. White Mountains’s review is based on a debt service model that forecasts operating results for BAM, and related payments on the BAM Surplus Notes, through maturity of the BAM Surplus Notes in 2042. The model depends on assumptions regarding future trends for the issuance of municipal bonds, interest rates, credit spreads, insured market penetration, competitive activity in the market for municipal bond insurance and other factors affecting the demand for and price of BAM’s municipal bond insurance.
•change in book value or adjusted book value per share or return on equity;