XML 102 R34.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
SUMMARY OF INVESTMENTS (Tables)
 12 Months Ended
Dec. 31, 2019
Investments, Debt and Equity Securities [Abstract]  
Reconciliation of Amortized Cost to Fair Value
The table that follows is a reconciliation of the amortized cost (cost for equity securities) to fair value of investments in available-for-sale fixed maturity securities, presented on a consolidated basis, including both continuing and discontinued operations as of December 31, 2019 and 2018.

December 31, 2019
 
Type of Investment
Cost or Amortized Cost
 
Gross Unrealized Appreciation
 
Gross Unrealized Depreciation
 
Fair Value
AVAILABLE-FOR-SALE
 
 
 
 
 
 
 
Fixed maturities
 
 
 
 
 
 
 
Bonds
 
 
 
 
 
 
 
U.S. Treasury
$
69,300

 
$
203

 
$
12

 
$
69,491

U.S. government agency
97,962

 
2,344

 
104

 
100,202

States, municipalities and political subdivisions
 
 
 
 
 
 
 
  General obligations:
 
 
 
 
 
 
 
     Midwest
85,607

 
2,987

 
—

 
88,594

     Northeast
30,120

 
1,150

 
—

 
31,270

     South
111,688

 
3,515

 
—

 
115,203

     West
105,569

 
4,748

 
—

 
110,317

   Special revenue:
 
 
 
 
 
 
 
     Midwest
133,717

 
6,175

 
—

 
139,892

     Northeast
58,665

 
2,878

 
—

 
61,543

     South
224,214

 
10,452

 
—

 
234,666

     West
138,557

 
6,287

 
—

 
144,844

Foreign bonds
4,936

 
181

 
—

 
5,117

Public utilities
60,950

 
2,701

 
—

 
63,651

Corporate bonds
 
 
 
 
 
 
 
Energy
28,695

 
1,429

 
—

 
30,124

Industrials
52,249

 
1,766

 
—

 
54,015

Consumer goods and services
47,131

 
2,335

 
—

 
49,466

Health care
8,998

 
482

 
—

 
9,480

Technology, media and telecommunications
25,931

 
1,739

 
—

 
27,670

Financial services
96,613

 
3,870

 
230

 
100,253

Mortgage-backed securities
6,250

 
127

 
21

 
6,356

Collateralized mortgage obligations
 
 
 
 
 
 
 
Government national mortgage association
78,400

 
2,053

 
97

 
80,356

Federal home loan mortgage corporation
123,572

 
1,150

 
220

 
124,502

Federal national mortgage association
70,322

 
1,631

 
108

 
71,845

Asset-backed securities
314

 
436

 
—

 
750

Total Available-For-Sale Fixed Maturities
$
1,659,760

 
$
60,639

 
$
792

 
$
1,719,607

December 31, 2018
 
Type of Investment
Cost or Amortized Cost
 
Gross Unrealized Appreciation
 
Gross Unrealized Depreciation
 
Fair Value
AVAILABLE-FOR-SALE
 
 
 
 
 
 
 
Fixed maturities
 
 
 
 
 
 
 
Bonds
 
 
 
 
 
 
 
U.S. Treasury
$
27,632

 
$
6

 
$
220

 
$
27,418

U.S. government agency
215,535

 
896

 
1,749

 
214,682

States, municipalities and political subdivisions
 
 
 
 
 
 
 
   General obligations:
 
 
 
 
 
 
 
      Midwest
94,806

 
1,091

 
685

 
95,212

      Northeast
37,326

 
432

 
103

 
37,655

      South
114,710

 
754

 
1,553

 
113,911

      West
107,787

 
1,229

 
1,175

 
107,841

   Special revenue:
 
 
 
 
 
 
 
      Midwest
140,025

 
1,609

 
870

 
140,764

      Northeast
62,737

 
452

 
1,241

 
61,948

      South
237,848

 
1,669

 
3,708

 
235,809

      West
143,829

 
1,294

 
2,203

 
142,920

Foreign bonds
9,698

 
31

 
13

 
9,716

Public utilities
56,808

 
274

 
1,023

 
56,059

Corporate bonds
 
 
 
 
 
 
 
Energy
28,909

 
43

 
304

 
28,648

Industrials
53,867

 
124

 
906

 
53,085

Consumer goods and services
54,323

 
142

 
819

 
53,646

Health care
16,721

 
42

 
105

 
16,658

Technology, media and telecommunications
26,819

 
35

 
678

 
26,176

Financial services
81,286

 
238

 
2,175

 
79,349

Mortgage-backed securities
7,642

 
14

 
232

 
7,424

Collateralized mortgage obligations
 
 
 
 
 
 
 
Government national mortgage association
78,055

 
380

 
1,734

 
76,701

Federal home loan mortgage corporation
108,403

 
524

 
1,304

 
107,623

Federal national mortgage association
53,267

 
213

 
732

 
52,748

Asset-backed securities
3,256

 
352

 
113

 
3,495

Total Available-For-Sale Fixed Maturities
$
1,761,289

 
$
11,844

 
$
23,645

 
$
1,749,488
Contractual Maturity of Investments
The amortized cost and fair value of available-for-sale and trading fixed maturity securities at December 31, 2019, 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.
Maturities
 
 
 
 
 
 
 
 
 
 
Available-For-Sale
 
Trading
December 31, 2019
 
Amortized Cost
 
Fair Value
 
Amortized Cost
 
Fair Value
Due in one year or less
 
$
56,316

 
$
56,635

 
$
2,464

 
$
3,132

Due after one year through five years
 
286,426

 
293,956

 
6,967

 
8,586

Due after five years through 10 years
 
481,310

 
504,300

 
—

 
—

Due after 10 years
 
556,850

 
580,907

 
2,510

 
3,538

Asset-backed securities
 
314

 
750

 
—

 
—

Mortgage-backed securities
 
6,250

 
6,356

 
—

 
—

Collateralized mortgage obligations
 
272,294

 
276,703

 
—

 
—

 
 
$
1,659,760

 
$
1,719,607

 
$
11,941

 
$
15,256
Summary of Net Realized Investment Gains (Losses) A summary of net realized investment gains (losses) for 2019, 2018 and 2017, is as follows:
 
2019
 
2018
 
2017
Net realized investment gains (losses) from continuing operations
 
 
 
 
 
Fixed maturities:
 
 
 
 
 
Available-for-sale
$
655

 
$
(254
)
 
$
829

Trading securities
 
 
 
 
 
Change in fair value
1,351

 
(296
)
 
924

Sales
1,993

 
1,226

 
244

Equity securities
 
 
 
 
 
Change in fair value
51,231

 
(21,994
)
 
332

Sales
725

 
1,702

 
1,610

Mortgage loans
(26
)
 
(46
)
 
—

   Real estate
(2,150
)
 
(517
)
 
116

   Total net realized investment gains (losses) from continuing operations
$
53,779


$
(20,179
)

$
4,055

   Total net realized investment gains (losses) from discontinued operations
—

 
(1,057
)
 
4,008

Total net realized investment gains (losses)
$
53,779

 
$
(21,236
)
 
$
8,063
Schedule of Proceeds and Gross Realized Gains (Losses)
The proceeds and gross realized gains (losses) on the sale of available-for-sale fixed maturity securities from continuing operations for 2019, 2018 and 2017, are as follows:
 
2019
 
2018
 
2017
Proceeds from sales
$
41,760

 
$
132,250

 
$
7,404

Gross realized gains
302

 
140

 
1,046

Gross realized losses
(13
)
 
(517
)
 
(20
)

The proceeds and gross realized gains (losses) on the sale of available-for-sale fixed maturity securities from discontinued operations for 2019, 2018 and 2017, are as follows:
 
2019
 
2018
 
2017
Proceeds from sales
$
—

 
$
—

 
$
7,315

Gross realized gains
—

 
—

 
1,264

Gross realized losses
—

 
—

 
(78
)
Schedule of Net Investment Income
Net investment income for the years ended December 31, 2019, 2018 and 2017, is comprised of the following:
Years Ended December 31,
2019
 
2018
 
2017
Investment income from continuing operations:
 
 
 
 
 
Interest on fixed maturities
$
50,274

 
$
51,356

 
$
44,784

Dividends on equity securities
7,842

 
7,731

 
7,108

Income on other long-term investments
 
 
 
 
 
Investment income
3,115

 
8,383

 
6,870

Change in value (1)
1,114

 
(10,116
)
 
(2,812
)
Interest on mortgage loans
1,595

 
412

 
—

Interest on short-term investments
522

 
606

 
120

Interest on cash and cash equivalents
2,681

 
1,875

 
1,125

Other
252

 
307

 
300

Total investment income from continuing operations
$
67,395

 
$
60,554

 
$
57,495

Less investment expenses
6,981

 
7,660

 
6,305

Net investment income from continuing operations
$
60,414

 
$
52,894

 
$
51,190

Net investment income from discontinued operations
$
—

 
$
12,663

 
$
49,720

Net investment income
$
60,414

 
$
65,557

 
$
100,910

(1)
Represents the change in value of our interests in limited liability partnerships that are recorded on the equity method of accounting.
Summary of Changes in Net Unrealized Investment Appreciation
A summary of changes in net unrealized investment appreciation for 2019, 2018 and 2017, is as follows for continuing operations and discontinued operations:
 
2019
 
2018
 
2017
Change in net unrealized investment appreciation
 
 
 
 
 
Available-for-sale fixed maturities
$
71,648


$
(57,475
)
 
$
25,573

Available-for-sale equity securities
—

 
—

 
40,168

Deferred policy acquisition costs
—

 
7,274

 
119

Income tax effect
(15,046
)
 
10,543

 
(21,545
)
Cumulative change in accounting principles
—

 
(191,244
)
 
—

Accumulated effect of change in enacted tax rate
—

 
—

 
36,658

Net unrealized investment depreciation of discontinued operations, sold
—

 
6,714

 
—

Total change in net unrealized investment appreciation (depreciation), net of tax
$
56,602

 
$
(224,188
)

$
80,973
Summary of Investments in Unrealized Loss Position
The tables on the following pages summarize our fixed maturity and equity securities that were in an unrealized loss position at December 31, 2019 and 2018 for continuing operations and discontinued operations. 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 December 31, 2019 if future events or information cause us to determine that a decline in fair value is other-than-temporary.
We have evaluated the near-term prospects of the issuers of our fixed maturity securities in relation to the severity and duration of the unrealized loss and determined that these losses did not warrant the recognition of an OTTI charge in 2019, 2018 or 2017. All fixed maturity securities in the investment portfolio continue to pay the expected coupon payments under the contractual terms of the securities. We believe the unrealized depreciation in value of other 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 intention to sell and it is more likely than not that we will not be required to sell these securities until the fair value recovers to at least equal to our cost basis or the securities mature.













 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2019
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
—

 
$
—

 
$
—

 
2

 
$
4,733

 
$
12

 
$
4,733

 
$
12

U.S. government agency
3

 
13,846

 
104

 
—

 
—

 
—

 
13,846

 
104

Corporate bonds - financial services
3

 
10,906

 
142

 
1

 
4,913

 
88

 
15,819

 
230

Mortgage-backed securities
—

 
—

 
—

 
13

 
1,585

 
21

 
1,585

 
21

Collateralized mortgage obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government national mortgage association
2

 
8,444

 
38

 
5

 
3,053

 
59

 
11,497

 
97

Federal home loan mortgage corporation
12

 
50,829

 
183

 
3

 
4,844

 
37

 
55,673

 
220

Federal national mortgage association
4

 
23,515

 
90

 
3

 
1,102

 
18

 
24,617

 
108

Total Available-for-Sale Fixed Maturities
24

 
$
107,540

 
$
557

 
27

 
$
20,230

 
$
235

 
$
127,770

 
$
792


 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2018
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
1

 
$
8,018

 
$
7

 
5

 
$
14,645

 
$
213

 
$
22,663

 
$
220

U.S. government agency
4

 
17,907

 
81

 
17

 
80,696

 
1,668

 
98,603

 
1,749

States, municipalities and political subdivisions
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   General obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
      Midwest
2

 
2,939

 
5

 
7

 
23,749

 
680

 
26,688

 
685

      Northeast
—

 
—

 
—

 
3

 
12,110

 
103

 
12,110

 
103

      South
1

 
778

 
2

 
22

 
50,174

 
1,551

 
50,952

 
1,553

      West
1

 
1,203

 
5

 
16

 
48,499

 
1,170

 
49,702

 
1,175

   Special revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
      Midwest
4

 
3,892

 
8

 
19

 
43,854

 
862

 
47,746

 
870

      Northeast
—

 
—

 
—

 
14

 
37,629

 
1,241

 
37,629

 
1,241

      South
4

 
4,298

 
30

 
45

 
107,016

 
3,678

 
111,314

 
3,708

      West
4

 
11,115

 
32

 
28

 
69,667

 
2,171

 
80,782

 
2,203

Foreign bonds
1

 
2,984

 
13

 
—

 
—

 
—

 
2,984

 
13

Public utilities
12

 
25,781

 
552

 
8

 
17,253

 
471

 
43,034

 
1,023

Corporate bonds
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Energy
7

 
12,556

 
148

 
2

 
4,099

 
156

 
16,655

 
304

Industrials
9

 
21,970

 
397

 
4

 
11,040

 
509

 
33,010

 
906

Consumer goods and services
14

 
30,399

 
527

 
5

 
9,554

 
292

 
39,953

 
819

Health care
3

 
6,203

 
97

 
1

 
345

 
8

 
6,548

 
105

Technology, media and telecommunications
6

 
12,638

 
288

 
5

 
9,619

 
390

 
22,257

 
678

Financial services
13

 
30,177

 
650

 
13

 
32,855

 
1,525

 
63,032

 
2,175

Mortgage-backed securities
22

 
1,539

 
34

 
22

 
4,166

 
198

 
5,705

 
232

Collateralized mortgage obligations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Government national mortgage association
2

 
3,797

 
55

 
22

 
44,690

 
1,679

 
48,487

 
1,734

Federal home loan mortgage corporation
3

 
4,541

 
20

 
18

 
38,189

 
1,284

 
42,730

 
1,304

Federal national mortgage association
4

 
2,107

 
3

 
15

 
38,986

 
729

 
41,093

 
732

Asset-backed securities
1

 
2,829

 
113

 
—

 
—

 
—

 
2,829

 
113

Total Available-for-Sale Fixed Maturities
118

 
$
207,671

 
$
3,067

 
291

 
$
698,835

 
$
20,578

 
$
906,506

 
$
23,645