Fair Value of Financial Instruments (Tables)

6 Months Ended

Jun. 30, 2015

Carrying Value and Estimated Fair Value of Financial Instruments

A summary of the carrying value and estimated fair value of our financial instruments at June 30, 2015 and December 31, 2014 is as follows:



	June 30, 2015				December 31, 2014
	Fair Value		Carrying Value		Fair Value		Carrying Value
Assets
Investments
Fixed maturities:
Held-to-maturity securities	$	359	$	356	$	404	$	397
Available-for-sale securities	2,811,361		2,811,361		2,843,079		2,843,079
Trading securities	16,388		16,388		16,862		16,862
Equity securities:
Available-for-sale securities	244,547		244,547		245,843		245,843
Trading securities	3,599		3,599		4,066		4,066
Mortgage loans	4,388		4,082		4,559		4,199
Policy loans	5,702		5,702		5,916		5,916
Other long-term investments	50,656		50,656		50,424		50,424
Short-term investments	175		175		175		175
Cash and cash equivalents	93,382		93,382		90,574		90,574
Corporate-owned life insurance	1,148		1,148		918		918
Liabilities
Policy reserves
Annuity (accumulations) ⁽¹⁾	$	783,329	$	790,701	$	865,802	$	863,606
Annuity (benefit payments)	130,123		95,432		176,592		99,121

(1) Annuity accumulations represent deferred annuity contracts that are currently earning interest.

Financial Instruments Measured at Fair Value on Recurring Basis

The following tables present the categorization for our financial instruments measured at fair value on a recurring basis in our Consolidated Balance Sheets at June 30, 2015 and December 31, 2014:



June 30, 2015			Fair Value Measurements
Description	Total		Level 1		Level 2		Level 3
AVAILABLE-FOR-SALE
Fixed maturities:
Bonds
U.S. Treasury	$	20,915	$	—	$	20,915	$	—
U.S. government agency	267,313		—		267,313		—
States, municipalities and political subdivisions
General obligations
Midwest	165,128		—		165,128		—
Northeast	56,645		—		56,645		—
South	128,315		—		128,315		—
West	97,153		—		97,153		—
Special revenue
Midwest	148,814		—		148,384		430
Northeast	19,906		—		19,906		—
South	106,052		—		106,052		—
West	79,531		—		79,531		—
Foreign bonds	105,194		—		105,194		—
Public utilities	203,736		—		203,736		—
Corporate bonds
Energy	115,590		—		115,590		—
Industrials	222,604		—		222,604		—
Consumer goods and services	183,508		—		182,195		1,313
Health care	94,971		—		94,971		—
Technology, media and telecommunications	145,334		—		145,334		—
Financial services	261,167		—		250,536		10,631
Mortgage-backed securities	15,521		—		15,521		—
Collateralized mortgage obligations	368,008		—		368,008		—
Asset-backed securities	5,956		—		4,645		1,311
Total Available-for-Sale Fixed Maturities	$	2,811,361	$	—	$	2,797,676	$	13,685
Equity securities:
Common stocks
Public utilities	$	17,512	$	17,512	$	—	$	—
Energy	13,104		13,104		—		—
Industrials	46,670		46,668		2		—
Consumer goods and services	22,750		22,750		—		—
Health care	32,353		32,353		—		—
Technology, media and telecommunications	13,207		13,207		—		—
Financial services	94,495		90,440		77		3,978
Nonredeemable preferred stocks	4,456		556		3,900		—
Total Available-for-Sale Equity Securities	$	244,547	$	236,590	$	3,979	$	3,978



Total Available-for-Sale Securities	$	3,055,908	$	236,590	$	2,801,655	$	17,663
TRADING
Fixed maturities:
Corporate bonds
Industrials	$	3,668	$	—	$	3,668	$	—
Consumer goods and services	111		—		111		—
Health care	2,609		—		2,609		—
Technology, media and telecommunications	323		—		323		—
Financial services	5,540		—		5,540		—
Redeemable preferred stocks	4,137		4,137		—		—
Equity securities:
Energy	378		378		—		—
Consumer goods and services	1,000		1,000		—		—
Health care	328		328		—		—
Technology, media and telecommunications	365		365		—		—
Nonredeemable preferred stocks	1,528		1,528		—		—
Total Trading Securities	$	19,987	$	7,736	$	12,251	$	—
Short-Term Investments	$	175	$	175	$	—	$	—
Money Market Accounts	$	39,693	$	39,693	$	—	$	—
Corporate-Owned Life Insurance	$	1,148	$	—	$	1,148	$	—
Total Assets Measured at Fair Value	$	3,116,911	$	284,194	$	2,815,054	$	17,663



December 31, 2014			Fair Value Measurements
Description	Total		Level 1		Level 2		Level 3
AVAILABLE-FOR-SALE
Fixed maturities:
Bonds
U.S. Treasury	$	25,972	$	—	$	25,972	$	—
U.S. government agency	351,672		—		351,672		—
States, municipalities and political subdivisions
General obligations
Midwest	185,920		—		185,920		—
Northeast	61,154		—		61,154		—
South	126,220		—		126,220		—
West	78,433		—		78,433		—
Special revenue
Midwest	131,402		—		130,883		519
Northeast	12,631		—		12,631		—
South	111,222		—		111,222		—
West	71,303		—		71,303		—
Foreign bonds	140,173		—		140,173		—
Public utilities	212,357		—		212,357		—
Corporate bonds
Energy	137,133		—		137,133		—
Industrials	215,475		—		215,475		—
Consumer goods and services	177,001		—		175,682		1,319
Health care	89,035		—		89,035		—
Technology, media and telecommunications	134,529		—		134,529		—
Financial services	223,582		—		212,589		10,993
Mortgage-backed securities	17,558		—		17,558		—
Collateralized mortgage obligations	337,289		—		337,289		—
Asset-backed securities	3,018		—		1,406		1,612
Total Available-for-Sale Fixed Maturities	$	2,843,079	$	—	$	2,828,636	$	14,443
Equity securities:
Common stocks
Public utilities	$	20,290	$	20,290	$	—	$	—
Energy	13,717		13,717		—		—
Industrials	45,459		45,458		1		—
Consumer goods and services	23,314		23,314		—		—
Health care	30,356		30,356		—		—
Technology, media and telecommunications	13,995		13,995		—		—
Financial services	93,663		89,719		72		3,872
Nonredeemable preferred stocks	5,049		558		4,491		—
Total Available-for-Sale Equity Securities	$	245,843	$	237,407	$	4,564	$	3,872
Total Available-for-Sale Securities	$	3,088,922	$	237,407	$	2,833,200	$	18,315



TRADING
Fixed maturities:
Bonds
Corporate bonds
Industrials	$	3,352	$	—	$	3,352	$	—
Health care	2,425		—		2,425		—
Technology, media and telecommunications	338		—		338		—
Financial services	5,997		—		5,997		—
Redeemable preferred stocks	4,750		4,750		—		—
Equity securities:
Energy	411		411		—		—
Consumer goods and services	1,034		1,034		—		—
Health care	327		327		—		—
Technology, media and telecommunications	411		411		—		—
Nonredeemable preferred stocks	1,883		1,883		—		—
Total Trading Securities	$	20,928	$	8,816	$	12,112	$	—
Short-Term Investments	$	175	$	175	$	—	$	—
Money Market Accounts	$	28,095	$	28,095	$	—	$	—
Corporate-Owned Life Insurance	$	918	$	—	$	918	$	—
Total Assets Measured at Fair Value	$	3,139,038	$	274,493	$	2,846,230	$	18,315

Changes in Fair Value of Level 3 Securities

The following table provides a summary of the changes in fair value of our Level 3 securities for the three-month period ended June 30, 2015:



	States, municipalities and political subdivisions			Corporate bonds			Asset-backed securities			Equities		Total
Balance at March 31, 2015	$	519		$	12,199		$	1,493		$	3,978	$	18,189
Net unrealized losses⁽¹⁾	(14		)	(32		)	(48		)	—		(94		)
Disposals	(75		)	(223		)	(134		)	—		(432		)
Balance at June 30, 2015	$	430		$	11,944		$	1,311		$	3,978	$	17,663

(1) Unrealized losses are recorded as a component of comprehensive income.

The following table provides a summary of the changes in fair value of our Level 3 securities for the six-month period ended June 30, 2015:



	States, municipalities and political subdivisions			Corporate bonds			Asset-backed securities			Equities			Total
Balance at January 1, 2015	$	519		$	12,312		$	1,612		$	3,872		$	18,315
Net unrealized gains (losses)⁽¹⁾	(14		)	150			(40		)	—			96
Purchases	—			—			—			121			121
Disposals	(75		)	(518		)	(261		)	(15		)	(869		)
Balance at June 30, 2015	$	430		$	11,944		$	1,311		$	3,978		$	17,663

(1) Unrealized gains (losses) are recorded as a component of comprehensive income.