SUMMARY OF INVESTMENTS

Fair Value of Investments

A reconciliation of the amortized cost (cost for equity securities) to fair value of investments in held-to-maturity and available-for-sale fixed maturity and equity securities as of March 31, 2012 and December 31, 2011, is as follows:



March 31, 2012	(Dollars in Thousands)
Type of Investment	Cost or Amortized Cost		Gross Unrealized Appreciation		Gross Unrealized Depreciation		Fair Value
HELD-TO-MATURITY
Fixed maturities
Bonds
States, municipalities and political subdivisions	$	3,729	$	56	$	—	$	3,785
Mortgage-backed securities	305		19		—		324
Collateralized mortgage obligations	38		1		—		39
Total Held-to-Maturity Fixed Maturities	$	4,072	$	76	$	—	$	4,148
AVAILABLE-FOR-SALE
Fixed maturities
Bonds
U.S. Treasury	$	42,067	$	1,173	$	26	$	43,214
U.S. government agency	78,383		358		604		78,137
States, municipalities and political subdivisions	699,745		56,614		658		755,701
Foreign bonds	225,686		9,857		306		235,237
Public utilities	250,079		14,592		559		264,112
Corporate bonds
Energy	188,677		7,053		253		195,477
Industrials	323,822		12,014		736		335,100
Consumer goods and services	195,916		8,605		286		204,235
Health care	112,081		6,514		—		118,595
Technology, media and telecommunications	118,364		5,460		371		123,453
Financial services	287,327		9,113		1,988		294,452
Mortgage-backed securities	31,869		1,080		5		32,944
Collateralized mortgage obligations	101,826		3,641		627		104,840
Asset-backed securities	5,341		453		55		5,739
Redeemable preferred stocks	378		8		—		386
Total Available-For-Sale Fixed Maturities	$	2,661,561	$	136,535	$	6,474	$	2,791,622
Equity securities
Common stocks
Public utilities	$	7,231	$	7,059	$	141	$	14,149
Energy	5,094		7,247		—		12,341
Industrials	13,030		20,582		102		33,510
Consumer goods and services	10,373		8,239		87		18,525
Health care	8,212		9,316		157		17,371
Technology, media and telecommunications	5,367		5,242		77		10,532
Financial services	17,118		49,146		175		66,089
Nonredeemable preferred stocks	3,634		118		212		3,540
Total Available-for-Sale Equity Securities	$	70,059	$	106,949	$	951	$	176,057
Total Available-for-Sale Securities	$	2,731,620	$	243,484	$	7,425	$	2,967,679



December 31, 2011	(Dollars in Thousands)
Type of Investment	Cost or Amortized Cost		Gross Unrealized Appreciation		Gross Unrealized Depreciation		Fair Value
HELD-TO-MATURITY
Fixed maturities
Bonds
States, municipalities and political subdivisions	$	3,739	$	52	$	61	$	3,730
Mortgage-backed securities	356		25		—		381
Collateralized mortgage obligations	48		2		—		50
Total Held-to-Maturity Fixed Maturities	$	4,143	$	79	$	61	$	4,161
AVAILABLE-FOR-SALE
Fixed maturities
Bonds
U.S. Treasury	$	42,530	$	1,421	$	—	$	43,951
U.S. government agency	95,813		582		—		96,395
States, municipalities and political subdivisions	687,039		61,076		8		748,107
Foreign bonds	206,872		8,766		823		214,815
Public utilities	254,822		15,562		313		270,071
Corporate bonds
Energy	189,902		7,567		277		197,192
Industrials	285,696		10,631		650		295,677
Consumer goods and services	203,948		8,872		646		212,174
Health care	109,219		6,497		45		115,671
Technology, media and telecommunications	108,315		4,951		318		112,948
Financial services	258,526		9,075		2,300		265,301
Mortgage-backed securities	34,353		1,041		4		35,390
Collateralized mortgage obligations	79,545		3,490		184		82,851
Asset-backed securities	5,801		495		—		6,296
Redeemable preferred stocks	405		4		—		409
Total Available-For-Sale Fixed Maturities	$	2,562,786	$	140,030	$	5,568	$	2,697,248
Equity securities
Common stocks
Public utilities	$	7,231	$	7,602	$	98	$	14,735
Energy	5,094		7,116		—		12,210
Industrials	12,678		16,153		275		28,556
Consumer goods and services	10,750		7,982		168		18,564
Health care	8,212		8,008		232		15,988
Technology, media and telecommunications	5,368		4,796		146		10,018
Financial services	15,592		41,041		543		56,090
Nonredeemable preferred stocks	3,634		40		384		3,290
Total Available-for-Sale Equity Securities	$	68,559	$	92,738	$	1,846	$	159,451
Total Available-for-Sale Securities	$	2,631,345	$	232,768	$	7,414	$	2,856,699

Maturities

The amortized cost and fair value of held-to-maturity, available-for-sale and trading securities at March 31, 2012, by contractual maturity, are shown in the following table. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Asset-backed securities, mortgage-backed securities and collateralized mortgage obligations may be subject to prepayment risk and are therefore not categorized by contractual maturity.



(In Thousands)	Held-To-Maturity				Available-For-Sale				Trading
March 31, 2012	Amortized Cost		Fair Value		Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	396	$	397	$	263,128	$	267,824	$	1,891	$	1,920
Due after one year through five years	3,333		3,388		1,045,934		1,103,107		6,708		6,649
Due after five years through 10 years	—		—		1,052,661		1,114,410		1,864		1,808
Due after 10 years	—		—		160,802		162,758		4,552		4,853
Asset-backed securities	—		—		5,341		5,739		—		—
Mortgage-backed securities	305		324		31,869		32,944		—		—
Collateralized mortgage obligations	38		39		101,826		104,840		—		—
	$	4,072	$	4,148	$	2,661,561	$	2,791,622	$	15,015	$	15,230

Net Realized Investment Gains and Losses

Net realized gains (losses) on disposition of investments are computed using the specific identification method and are included in the computation of net income. A summary of net realized investment gains (losses) resulting from investment sales and calls is as follows:



	Three Months Ended March 31,
(In Thousands)	2012		2011
Net realized investment gains (losses)
Fixed maturities	$	1,531	$	1,386
Equity securities	701		1,116
Trading securities	562		316
Other long-term investments	—		(165		)
Total net realized investment gains	$	2,794	$	2,653

The proceeds and gross realized gains and losses on the sale of available-for-sale securities are as follows:



	Three Months Ended March 31,
(In Thousands)	2012		2011
Proceeds from sales	$	3,000	$	4,847
Gross realized gains	470		90
Gross realized losses	25		516

There were no sales of held-to-maturity securities during the three-month periods ended March 31, 2012 and 2011.

Our investment portfolio includes trading securities with embedded derivatives. These securities, which are primarily convertible redeemable preferred debt securities, are recorded at fair value. Income or loss, including the change in the fair value of these trading securities, is recognized currently in earnings as a component of net realized investment gains and losses. Our portfolio of trading securities had a fair value of $15.2 million and $13.5 million at March 31, 2012 and December 31, 2011, respectively.

Off-Balance Sheet Arrangements

Pursuant to an agreement with one of our limited liability partnership funds, we are contractually committed to make capital contributions up to $15.0 million, upon request by the partnership, through December 31, 2017. Our remaining potential contractual obligation was $8.7 million at March 31, 2012.

Unrealized Appreciation and Depreciation

A summary of changes in net unrealized investment appreciation (depreciation) during the reporting period is as follows:



	Three Months Ended March 31,
(In Thousands)	2012			2011
Change in net unrealized investment appreciation
Available-for-sale fixed maturities and equity securities	$	10,705		$	(5,083	)
Deferred policy acquisition costs	104			3,930
Income tax effect	(3,784		)	403
Total change in net unrealized investment appreciation, net of tax	$	7,025		$	(750	)

In the above table, the amount reported as changes in deferred policy acquisition costs for our life insurance segment represents the impact of fluctuations that occur in the interest rate environment from time to time.

We continually monitor the difference between our cost basis and the estimated fair value of our investments. Our accounting policy for impairment recognition requires other-than-temporary impairment ("OTTI") charges to be recorded when we determine that it is more likely than not that we will be unable to collect all amounts due according to the contractual terms of the fixed maturity security or that the anticipated recovery in fair value of the equity security will not occur in a reasonable amount of time. Impairment charges on investments are recorded based on the fair value of the investments at the measurement date. Factors considered in evaluating whether a decline in value is other-than-temporary include: the length of time and the extent to which fair value has been less than cost; the financial condition and near-term prospects of the issuer; our intention to hold the investment; and the likelihood that we will be required to sell the investment.

The tables on the following pages summarize our fixed maturity and equity securities that were in an unrealized loss position at March 31, 2012 and December 31, 2011. The securities are presented by the length of time they have been continuously in an unrealized loss position. It is possible that we could recognize OTTI charges in future periods on securities held at March 31, 2012, if future events or information cause us to determine that a decline in fair value is other-than-temporary.

We believe the unrealized depreciation in value of securities in our fixed maturity portfolio is primarily attributable to changes in market interest rates and not the credit quality of the issuer. We have no intent to sell and it is more likely than not that we will not be required to sell these securities until such time as the fair value recovers to at least equal our cost basis or the securities mature.

We have evaluated the unrealized losses reported for all of our equity securities at March 31, 2012, and have concluded that the duration and severity of these losses do not warrant the recognition of an OTTI charge at March 31, 2012. Our largest unrealized loss greater than 12 months on an individual equity security at March 31, 2012 was $0.1 million. We have no intention to sell any of these securities prior to a recovery in value, but will continue to monitor the fair value reported for these securities as part of our overall process to evaluate investments for OTTI recognition.



(In Thousands)
March 31, 2012	Less than 12 months					12 months or longer					Total
Type of Investment	Number of Issues	Fair Value		Gross Unrealized Depreciation		Number of Issues	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
AVAILABLE-FOR-SALE
Fixed maturities
Bonds
U.S. Treasury	5	$	3,961	$	26	—	$	—	$	—	$	3,961	$	26
U.S. government agency	19	52,880		604		—	—		—		52,880		604
States, municipalities and political subdivisions	37	19,242		658		—	—		—		19,242		658
Foreign bonds	12	23,193		285		1	836		21		24,029		306
Public utilities	15	27,734		498		1	1,159		61		28,893		559
Corporate bonds
Energy	9	24,102		253		—	—		—		24,102		253
Industrials	16	35,852		633		1	2,897		103		38,749		736
Consumer goods and services	10	15,223		267		1	1,397		19		16,620		286
Technology, media and telecommunications	7	21,860		371		—	—		—		21,860		371
Financial services	16	42,725		571		22	22,202		1,417		64,927		1,988
Mortgage-backed securities	6	636		5		—	—		—		636		5
Collateralized mortgage obligations	18	32,649		627		—	—		—		32,649		627
Asset-backed securities	1	193		55		—	—		—		193		55
Total Available-For-Sale Fixed Maturities	171	$	300,250	$	4,853	26	$	28,491	$	1,621	$	328,741	$	6,474
Equity securities
Common stocks
Public utilities	3	$	167	$	141	—	$	—	$	—	$	167	$	141
Industrials	6	497		42		6	487		60		984		102
Consumer goods and services	11	687		83		1	—		4		687		87
Health care	2	488		36		4	473		121		961		157
Technology, media and telecommunications	9	596		66		1	8		11		604		77
Financial services	2	120		17		5	940		158		1,060		175
Nonredeemable preferred stocks	2	144		1		2	1,021		211		1,165		212
Total Available-for-Sale Equity Securities	35	$	2,699	$	386	19	$	2,929	$	565	$	5,628	$	951
Total Available-for-Sale Securities	206	$	302,949	$	5,239	45	$	31,420	2,186		$	334,369	$	7,425



(In Thousands)
December 31, 2011	Less than 12 months					12 months or longer					Total
Type of Investment	Number of Issues	Fair Value		Gross Unrealized Depreciation		Number of Issues	Fair Value		Gross Unrealized Depreciation		Fair Value		Gross Unrealized Depreciation
HELD-TO-MATURITY
Fixed maturities
Bonds
States, municipalities and political subdivisions	—	$	—	$	—	1	$	473	$	61	$	473	$	61
Total Held-to-Maturity Fixed Maturities	—	$	—	$	—	1	$	473	$	61	$	473	$	61
AVAILABLE-FOR-SALE
Fixed maturities
Bonds
States, municipalities and political subdivisions	6	3,555		6		1	619		2		4,174		8
Foreign bonds	13	18,001		488		6	14,123		335		32,124		823
Public utilities	6	9,579		160		1	1,068		153		10,647		313
Corporate bonds
Energy	2	5,436		53		1	5,223		224		10,659		277
Industrials	9	25,664		359		3	8,135		291		33,799		650
Consumer goods and services	5	5,360		514		5	3,932		132		9,292		646
Health care	2	5,027		45		—	—		—		5,027		45
Technology, media and telecommunications	13	14,148		318		—	—		—		14,148		318
Financial services	23	20,073		292		26	28,892		2,008		48,965		2,300
Mortgage-backed securities	5	684		4		—	—		—		684		4
Collateralized mortgage obligations	7	4,466		141		3	5,209		43		9,675		184
Total Available-For-Sale Fixed Maturities	91	$	111,993	$	2,380	46	$	67,201	$	3,188	$	179,194	$	5,568
Equity securities
Common stocks
Public utilities	3	$	210	$	98	—	$	—	$	—	$	210	$	98
Industrials	7	975		155		8	577		120		1,552		275
Consumer goods and services	12	625		150		3	431		18		1,056		168
Health care	5	768		94		4	455		138		1,223		232
Technology, media and telecommunications	7	571		124		2	144		22		715		146
Financial services	16	1,876		319		6	746		224		2,622		543
Nonredeemable preferred stocks	3	1,171		31		2	878		353		2,049		384
Total Available-for-Sale Equity Securities	53	$	6,196	$	971	25	$	3,231	$	875	$	9,427	$	1,846
Total Available-for-Sale Securities	144	$	118,189	$	3,351	71	$	70,432	4,063		$	188,621	$	7,414
Total	144	$	118,189	$	3,351	72	$	70,905	$	4,124	$	189,094	$	7,475