We offer various benefits to our employees including a noncontributory defined benefit pension plan, an employee/retiree health and dental benefit plan, a profit-sharing plan and an employee stock ownership plan.

We offer a noncontributory defined benefit pension plan in which all of our employees are eligible to participate after they have completed one year of service, attained 21 years of age and have met the hourly service requirements. Retirement benefits under our pension plan are based on the number of years of service and level of compensation. Our policy to fund the pension plan on a current basis to not less than the minimum amounts required by the Employee Retirement Income Security Act of 1974, as amended, and the Internal Revenue Code of 1986, as amended, is to assure that plan assets will be adequate to provide retirement benefits. We estimate that we will contribute approximately $10,000 to the pension plan in 2020.

We also offer a health and dental benefit plan to all of our eligible employees and retirees that consists of two programs: (1) the self-funded employee health and dental benefit plan and (2) the self-funded (pre-65) and fully-funded (post-65) retiree health and dental benefit plan (the "post-retirement benefit plan"). Effective January 1, 2017, there was a plan amendment, which included the following changes: eliminated the pre-65 retirement plan with a $500 hundred dollar deductible; for retirements after January 1, 2017, the retiree will pay 50 percent of the

lower cost supplemental plan if they are 65 or older and 100 percent of the premium if less than 65; and removed spousal coverage after the death of the participant. The financial impact of the changes were reflected in accumulated other comprehensive income at December 31, 2016. Effective January 1, 2019, there was a plan amendment, which requires spouses to pay 100 percent of the medical, dental & vision premiums and the subsidy for the post-65 retirees is based off the lowest cost Medicare Supplement Plan (Plan 1). The financial impact of the changes were reflected in accumulated other comprehensive income at December 31, 2019.

The post-retirement benefit plan provides health and dental benefits to our retirees (and covered dependents) who have met the service and participation requirements stipulated by the post-retirement benefit plan. The third party administrators for the post-retirement benefit plan are responsible for making medical and dental care benefit payments. Participants are required to submit claims for reimbursement or payment to the claims administrator within twelve months after the end of the calendar year in which the charges were incurred. An unfunded benefit obligation is reported for the post-retirement benefit plan in the accompanying Consolidated Balance Sheets.

Our investment policy and objective for the pension plan is to generate long-term capital growth and income by way of a diversified investment portfolio along with appropriate employer contributions, which will allow us to provide for the pension plan's benefit obligation.

We have an internal investment/retirement committee, which includes our Chief Executive Officer, Chief Investment Officer, and Chief Operating Officer, all of whom receive monthly information on the value of the pension plan assets and their performance. Quarterly, the committee meets to review and discuss the performance of the pension plan assets as well as the allocation of investments within the pension plan.

As of December 31, 2019, we had six external investment managers that are allowed to exercise investment discretion, subject to limitations, if any, established by the investment/retirement committee. We utilize multiple investment managers in order to maximize the pension plan's investment return while mitigating risk. None of our investment managers uses leverage in managing the pension plan. Annually, the investment/retirement committee meets with each investment manager to review the investment manager's goals, objectives and the performance of the assets they manage. The decision to establish or terminate a relationship with an investment manager is at the discretion of our investment/retirement committee.

We consider historical experience for comparable investments and the target allocations we have established for the various asset categories of the pension plan to determine the expected long-term rate of return, which is an assumption as to the average rate of earnings expected on the pension plan funds invested, or to be invested, by the pension plan, to provide for the settlement of benefits included in the projected pension benefit obligation. Investment securities, in general, are exposed to various risks, such as fluctuating interest rates, credit standing of

the issuer of the security and overall market volatility. Annually, we perform an analysis of expected long-term rates of return based on the composition and allocation of our pension plan assets and recent economic conditions.



									Target
Pension Plan Assets	2019		% of Total		2018		% of Total		Allocation
Fixed maturity securities - corporate bonds	$	13,250	6.7	%	$	10,051	6.1	%	0	%	-	15	%
Redeemable preferred stock	2,929		1.5		2,697		1.6		0	%	-	10	%
Equity securities	117,117		58.7		86,586		52.5		50	%	-	70	%
Pooled separate accounts
Core plus bond separate account fund	20,505		10.3		20,222		12.3		0	%	-	40	%
U.S. property separate account fund	22,114		11.1		20,841		12.6		0	%	-	25	%
Arbitrage fund	9,245		4.6		8,716		5.3		0	%	-	10	%
United Life annuity	10,855		5.4		10,339		6.3		5	%	-	10	%
Cash and cash equivalents	3,451		1.7		5,367		3.3		0	%	-	10	%
Total plan assets	$	199,466	100.0	%	$	164,819	100.0	%

The investment return expectations for the pension plan are used to develop the asset allocation based on the specific needs of the pension plan. Accordingly, equity securities comprise the largest portion of our pension plan assets, as they yield the highest rate of return. The United Life annuity, which is the fifth largest asset category and was originally written by our former life insurance subsidiary in 1976, provides a guaranteed rate of return. The interest rate on the group annuity contract is determined annually.

The availability of assets held in cash and cash equivalents enables the pension plan to mitigate market risk that is associated with other types of investments and allows the pension plan to maintain liquidity both for the purpose of making future benefit payments to participants and their beneficiaries and for future investment opportunities.

Investments in equity securities are stated at fair value based upon quoted market prices reported on recognized securities exchanges on the last business day of the year. Purchases and sales of securities are recorded as of the trade date.

recent trading activity of the underlying security in the financial markets. These securities represent various taxable bonds held by the pension plan. These securities categorized as Level 2 are valued in the same manner as described in Part II, Item 8, Note 3 "Fair Value of Financial Instruments" and have the same controls in place.

The pension plan invests in two pooled separate account funds, a core plus bond separate account fund and a U.S. property separate account fund. Investments in the core plus bond separate account fund are stated at fair value as provided by the administrator of the fund based on the fair value of the underlying assets owned by the fund. The fair value measurement is classified within Level 2 of the fair value hierarchy. The fair value of the investments in the U.S. property separate account fund is provided by the administrator of the fund based on the net asset value of the fund. The net asset value is based on the fair value of the underlying properties included in the fund. The fair value of the underlying properties are based on property appraisals conducted by an independent third party. The fair value measurement is classified within Level 3 of the fair value hierarchy. We have not adjusted the net asset value provided by the custodian for either fund.

The fair value of the arbitrage fund is determined based on its net asset value, which is obtained from the custodian and determined monthly with issuances and redemptions of units of the fund made, based on the net asset value per unit as determined on the valuation date. We have not adjusted the net asset value provided by the custodian.

The United Life group annuity contract, which is a deposit administration contract, is stated at contract value as determined by United Life. Under the group annuity contract, the plan's investment account is credited with compound interest on the average account balance for the year. The interest rate is equivalent to the ratio of net investment income to mean assets of United Life, net of investment expenses.

Cash and cash equivalents primarily consist of insured cash and money market funds held with various financial institutions. Interest is earned on a daily basis. The fair value of these funds approximates their cost basis due to their short-term nature.



			Fair Value Measurements
Description	December 31, 2019		Level 1		Level 2		Level 3
Fixed maturity securities - corporate bonds	$	13,250	$	—	$	13,250	$	—
Redeemable preferred stock	2,929		2,929		—		—
Equity securities	117,117		117,117		—		—
Pooled separate accounts
Core plus bond separate account fund	20,505		—		20,505		—
U.S. property separate account fund	22,114		—		—		22,114
Arbitrage fund	9,245		—		9,245		—
Money market funds	3,448		3,448		—		—
Total assets measured at fair value	$	188,608	$	123,494	$	43,000	$	22,114



			Fair Value Measurements
Description	December 31, 2018		Level 1		Level 2		Level 3
Fixed maturity securities - corporate bonds	$	10,051	$	—	$	10,051	$	—
Redeemable preferred stock	2,697		2,697		—		—
Equity securities	86,586		86,586		—		—
Pooled separate accounts
Core plus bond separate account fund	20,222		—		20,222		—
U.S. property separate account fund	20,841		—		—		20,841
Arbitrage fund	8,716		—		8,716		—
Money market funds	5,364		5,364		—		—
Total assets measured at fair value	$	154,477	$	94,647	$	38,989	$	20,841

The fair value of fixed maturity securities categorized as Level 2 is determined by management based on fair value information reported in the custodial statements, which is derived from recent trading activity of the underlying security in the financial markets. These securities represent various taxable bonds held by the pension plan. These securities categorized as Level 2 are valued in the same manner as described in Part II, Item 8, Note 3 "Fair Value of Financial Instruments" and have the same controls in place.

The fair value of the arbitrage fund and bond and mortgage pooled separate account fund are categorized as Level 2 since there are no restrictions as to the pension plan's ability to redeem its investment at the net asset value of the fund as of the reporting date.

The preparation of financial statements in conformity with GAAP requires us to make various estimates and assumptions that affect the reporting of net periodic benefit cost, plan assets and plan obligations for each plan at the date of the financial statements. Actual results could differ from these estimates. One significant estimate relates to the calculation of the benefit obligation for each plan. We annually establish the discount rate, which is an estimate of the interest rate at which these benefits could be effectively settled, that is used to determine the present value of the respective plan's benefit obligations as of December 31. In estimating the discount rate, we look to rates of return on high-quality, fixed-income investments currently available and expected to be available during the period to maturity of the respective plan's benefit obligations.

In October 2014, the Society of Actuaries finalized a new mortality table and a new mortality improvement scale. The mortality improvement scale was further refined by the Society of Actuaries in 2015, 2016 and 2017. In October 2018, the mortality assumption has been updated to reflect the annual historical U.S. mortality data to 2016 published by the Society of Actuaries. These updated tables reflect improved life expectancies and an expectation that the trend will continue. We have reviewed these updated tables and have updated the mortality assumptions based on this information and also based on research provided by our external actuaries. We will continue to monitor mortality assumptions and make changes as appropriate to reflect additional research and our resulting best estimate of future mortality rates.



Weighted-average assumptions as of	Pension Benefits				Post-retirement Benefits
December 31,	2019		2018		2019		2018
Discount rate	3.32	%	4.18	%	3.32	%	4.18	%
Rate of compensation increase	3.00		3.00		N/A		N/A



Weighted-average assumptions as of	Pension Benefits						Post-retirement Benefits
January 1,	2019		2018		2017		2019		2018		2017
Discount rate	4.18	%	3.65	%	4.17	%	4.18	%	3.65	%	4.17	%
Expected long-term rate of return on plan assets	6.70		6.70		7.50		N/A		N/A		N/A
Rate of compensation increase	3.00		3.00		3.00		N/A		N/A		N/A



	Health Care Benefits				Dental Claims
Years Ended December 31,	2019		2018		2019		2018
Health care cost trend rates assumed for next year	6.75	%	6.75	%	4.00	%	4.00	%
Rate to which the health care trend rate is assumed to decline (ultimate trend rate)	4.50	%	4.50	%	N/A		N/A
Year that the rate reaches the ultimate trend rate	2030		2029		N/A		N/A

Assumed health care cost trend rates have a significant effect on the amounts reported for the post-retirement benefit plan. A 1.0 percent change in assumed health care cost trend rates would have the following effects:



	Pension Benefits						Post-retirement Benefits
Years Ended December 31,	2019			2018			2019			2018
Reconciliation of benefit obligation
Benefit obligation at beginning of year	$	202,156		$	208,349		$	30,973		$	55,728
Service cost	7,989			8,701			1,823			2,998
Interest cost	8,320			7,500			1,274			2,009
Actuarial loss (gain)	39,598			(17,535		)	(1,806		)	(12,094		)
Adjustment for plan amendment	—			—			—			(16,159		)
Benefit payments	(5,689		)	(4,859		)	(1,263		)	(1,509		)
Benefit obligation at end of year ⁽¹⁾	$	252,374		$	202,156		$	31,001		$	30,973
Reconciliation of fair value of plan assets
Fair value of plan assets at beginning of year	$	164,819		$	157,644		$	—		$	—
Actual return on plan assets	36,336			(4,366		)	—			—
Employer contributions	4,000			16,400			1,263			1,509
Benefit payments	(5,689		)	(4,859		)	(1,263		)	(1,509		)
Fair value of plan assets at end of year	$	199,466		$	164,819		$	—		$	—
Funded status at end of year	$	(52,908	)	$	(37,337	)	$	(31,001	)	$	(30,973	)

The following table displays the effect that the unrecognized prior service cost and unrecognized actuarial loss of our plans had on accumulated other comprehensive income ("AOCI"), as reported in the accompanying Consolidated Balance Sheets:



	Pension Benefits				Post-retirement Benefits
Years Ended December 31	2019		2018		2019			2018
Amounts recognized in AOCI
Unrecognized prior service cost	$	—	$	—	$	(28,947	)	$	(37,631	)
Unrecognized actuarial (gain) loss	64,059		53,616		8,086			10,786
Total amounts recognized in AOCI	$	64,059	$	53,616	$	(20,861	)	$	(26,845	)

We anticipate amortization of the net actuarial losses for our pension plan in 2020 to be $3,914. We anticipate amortization of the net actuarial losses for our post-retirement benefit plan in 2020 to be $375



	Pension Plan									Post-retirement Benefit Plan
Years Ended December 31,	2019			2018			2017			2019			2018			2017

Net periodic benefit cost
Service cost	$	7,989		$	8,701		$	6,857		$	1,823		$	2,998		$	2,021
Interest cost	8,320			7,500			7,060			1,274			2,009			1,927
Expected return on plan assets	(10,784		)	(10,502		)	(9,650		)	—			—			—
Amortization of prior service cost	—			—			—			(8,684		)	(5,409		)	(5,409		)
Amortization of net loss	3,603			4,287			3,562			894			2,355			1,846
Net periodic benefit cost	$	9,128		$	9,986		$	7,829		$	(4,693	)	$	1,953		$	385

A portion of the service cost component of net periodic pension and postretirement benefit costs are capitalized and amortized as part of deferred acquisition costs and is included in the income statement line titled "amortization of deferred policy acquisition costs." The portion not related to the compensation and the other components of net periodic pension and postretirement benefit costs are included in the income statement line titled "other underwriting expenses."

We have a profit-sharing plan in which employees who meet service requirements are eligible to participate. The amount of our contribution is discretionary and is determined annually, but cannot exceed the amount deductible for federal income tax purposes. Our contribution to the profit-sharing plan for 2019, 2018 and 2017, was $4,096, $7,607, and $4,987, respectively.