The amortized cost, allowance for credit losses, carrying amount, gross unrecognized gains and losses, and the fair value of those investments classified as held-to-maturity at September 30, 2023 are summarized as follows:


	Amortized Cost		Allowance for Credit Losses			Carrying Amount		Gross Unrecognized Gains		Gross Unrecognized Losses			Fair Value
	(in thousands)
States and political subdivisions	$	420,017	$	(37	)	$	419,980	$	113	$	(30,814	)	$	389,279
Corporate bonds		52,727		(150	)		52,577		—		(3,562	)		49,015
U.S. agency-based mortgage-backed securities		3,403		—			3,403		4		(253	)		3,154
U.S. Treasury securities and obligations of U.S. government agencies		11,162		—			11,162		14		(649	)		10,527
Asset-backed securities		45		(1	)		44		—		—			44
Totals	$	487,354	$	(188	)	$	487,166	$	131	$	(35,278	)	$	452,019

The amortized cost, gross unrealized gains and losses, fair value, and the allowance for credit losses of those investments classified as available-for-sale at September 30, 2023 are summarized as follows:


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Allowance for Credit Losses
	(in thousands)
States and political subdivisions	$	138,627	$	—	$	(14,478	)	$	124,149	$	—
Corporate bonds		172,066		229		(9,224	)		163,071		—
U.S. agency-based mortgage-backed securities		5,376		—		(712	)		4,664		—
U.S. Treasury securities and obligations of U.S. government agencies		15,729		—		(1,573	)		14,156		—
Totals	$	331,798	$	229	$	(25,987	)	$	306,040	$	—

The cost, gross unrealized gains and losses, and the fair value of equity securities at September 30, 2023 are summarized as follows:


	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Equity securities:
Domestic common stock	$	46,944	$	7,982	$	—	$	54,926
Total equity securities	$	46,944	$	7,982	$	—	$	54,926


	Amortized Cost		Allowance for Credit Losses			Carrying Amount		Gross Unrecognized Gains		Gross Unrecognized Losses			Fair Value
	(in thousands)
States and political subdivisions	$	415,136	$	(40	)	$	415,096	$	922	$	(20,074	)	$	395,944
Corporate bonds		59,903		(196	)		59,707		1		(3,857	)		55,851
U.S. agency-based mortgage-backed securities		3,696		—			3,696		33		(153	)		3,576
U.S. Treasury securities and obligations of U.S. government agencies		13,123		—			13,123		25		(442	)		12,706
Asset-backed securities		69		(3	)		66		2		(1	)		67
Totals	$	491,927	$	(239	)	$	491,688	$	983	$	(24,527	)	$	468,144

The amortized cost, gross unrealized gains and losses, fair value, and the allowance for credit losses of those investments classified as available-for-sale at December 31, 2022 are summarized as follows:


	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Allowance for Credit Losses
	(in thousands)
States and political subdivisions	$	166,019	$	463	$	(9,826	)	$	156,656	$	—
Corporate bonds		150,915		530		(6,657	)		144,788		—
U.S. agency-based mortgage-backed securities		5,984		—		(538	)		5,446		—
U.S. Treasury securities and obligations of U.S. government agencies		15,675		9		(1,453	)		14,231		—
Totals	$	338,593	$	1,002	$	(18,474	)	$	321,121	$	—

The cost, gross unrealized gains and losses, and the fair value of equity securities at December 31, 2022 are summarized as follows:


	Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
	(in thousands)
Equity securities:
Domestic common stock	$	50,185	$	11,873	$	—	$	62,058
Total equity securities	$	50,185	$	11,873	$	—	$	62,058

A summary of the carrying amounts and fair value of investments in fixed maturity securities classified as held-to-maturity, by contractual maturity, is as follows:


	September 30, 2023				December 31, 2022
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in thousands)
Maturity:
Within one year	$	58,790	$	57,976	$	41,878	$	41,652
After one year through five years		144,736		135,910		165,216		159,006
After five years through ten years		114,028		103,007		121,739		112,665
After ten years		166,165		151,928		159,093		151,178
U.S. agency-based mortgage-backed securities		3,403		3,154		3,696		3,576
Asset-backed securities		44		44		66		67
Totals	$	487,166	$	452,019	$	491,688	$	468,144

A summary of the amortized cost and fair value of investments in fixed maturity securities classified as available-for-sale, by contractual maturity, is as follows:


	September 30, 2023				December 31, 2022
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(in thousands)
Maturity:
Within one year	$	29,845	$	29,610	$	28,290	$	27,814
After one year through five years		105,650		98,566		68,876		65,406
After five years through ten years		83,150		75,968		102,296		95,366
After ten years		107,777		97,232		133,147		127,089
U.S. agency-based mortgage-backed securities		5,376		4,664		5,984		5,446
Totals	$	331,798	$	306,040	$	338,593	$	321,121

The following table summarizes the fair value and gross unrealized losses on securities classified as available-for-sale, aggregated by major investment category and length of time that the individual securities have been in a continuous unrealized loss position as of September 30, 2023:


	Less Than 12 Months				12 Months or Greater				Total
	Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
	(in thousands)
September 30, 2023
Available-for-Sale
States and political subdivisions	$	55,911	$	3,207	$	68,237	$	11,271	$	124,148	$	14,478
Corporate bonds		51,905		2,247		90,991		6,977		142,896		9,224
U.S. agency-based mortgage-backed securities		—		—		4,664		712		4,664		712
U.S. Treasury securities and obligations of U.S. government agencies		909		17		13,246		1,556		14,155		1,573
Total available-for-sale securities	$	108,725	$	5,471	$	177,138	$	20,516	$	285,863	$	25,987

At September 30, 2023, we held 202 individual fixed maturity securities classified as available-for-sale that were in an unrealized loss position.


	Less Than 12 Months				12 Months or Greater				Total
	Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
	(in thousands)
December 31, 2022
Available-for-Sale
States and political subdivisions	$	87,522	$	5,319	$	24,980	$	4,507	$	112,502	$	9,826
Corporate bonds		98,590		4,549		30,011		2,108		128,601		6,657
U.S. agency-based mortgage-backed securities		4,732		444		714		94		5,446		538
U.S. Treasury securities and obligations of U.S. government agencies		5,589		313		7,719		1,140		13,308		1,453
Total available-for-sale securities	$	196,433	$	10,625	$	63,424	$	7,849	$	259,857	$	18,474

The following table illustrates the changes in the allowance for credit losses by major security type of the investments classified as held-to-maturity for the quarter ended September 30, 2023.


	States and Political Subdivisions			Corporate Bonds			U.S. Agency -Based Mortgage- Backed Securities		U.S. Treasury Securities and Obligations of U.S. Government Agencies		Asset-Backed Securities			Totals
	(in thousands)
Balance at June 30, 2023	$	41		$	161		$	—	$	—	$	2		$	204
Provision for credit loss benefit		(4	)		(11	)		—		—		(1	)		(16	)
Balance at September 30, 2023	$	37		$	150		$	—	$	—	$	1		$	188

The following table illustrates the changes in the allowance for credit losses by major security type of the investments classified as held-to-maturity for the nine months ended September 30, 2023.


	States and Political Subdivisions			Corporate Bonds			U.S. Agency -Based Mortgage- Backed Securities		U.S. Treasury Securities and Obligations of U.S. Government Agencies		Asset-Backed Securities			Totals
	(in thousands)
Balance at December 31, 2022	$	40		$	196		$	—	$	—	$	3		$	239
Provision for credit loss benefit		(3	)		(46	)		—		—		(2	)		(51	)
Balance at September 30, 2023	$	37		$	150		$	—	$	—	$	1		$	188

The Company has established an allowance for credit losses on 471 held-to-maturity securities totaling $0.2 million. The majority of those securities were issued by states and political subdivisions (450 securities) and corporate bonds (18 securities).

The Company has no allowance for credit losses on investments classified as available-for-sale for the period ended September 30, 2023.

The credit rating used for held-to-maturity fixed income securities is the rating for each security as published by Moody’s, S&P, and Fitch to determine the probability of default. If there are two ratings, the lower rating is used. If there are three ratings, the median rating is used. If there is one rating, that rating is used. For corporate fixed income securities (given a rating), the probability of default comes from Moody’s annual study of corporate bond defaults published each February. The maximum maturity using the default rate is 20 years (any maturity greater than 20 years will use the 20-year rate). For municipal fixed income securities (given a rating), the probability of default comes from Moody’s annual study of municipal bond defaults published each July/August.

The calculation of the credit loss allowance takes the amortized cost of the fixed income security and assumes default and recovery based on the average recovery rates from the Moody’s default studies. The amortized cost of the security, minus the amount recovered, is the estimated full amount the Company could lose in a default scenario. Then this amount is multiplied by the probability of default to determine the allowance for credit loss. The lower the security is rated, the higher likelihood of default, and therefore a higher allowance for credit loss. The longer to the maturity date of a security, the higher the default risk.

The table below presents the amortized cost of held-to-maturity securities aggregated by credit quality indicator as of September 30, 2023.


	States and Political Subdivisions		Corporate Bonds		U.S. Agency -Based Mortgage- Backed Securities		U.S. Treasury Securities and Obligations of U.S. Government Agencies		Asset-Backed Securities		Totals
	Amortized cost
	(in thousands)
AAA/AA/A ratings	$	417,062	$	22,918	$	3,403	$	11,162	$	30	$	454,575
Baa/BBB ratings		2,955		29,809		—		—		15		32,779
B ratings		—		—		—		—		—		—
Total	$	420,017	$	52,727	$	3,403	$	11,162	$	45	$	487,354

Net realized gains in the quarter ended September 30, 2023 were $5.1 million resulting from the sale of equity and fixed maturity securities classified as available-for-sale. Net realized gains in the quarter ended September 30, 2022 were $0.6 million resulting from the sale of equity securities.

Net realized gains in the nine months ended September 30, 2023 were $5.5 million resulting primarily from the sale of equity and fixed maturity securities classified as available-for-sale. Net realized gains in the nine months ended September 30, 2022 were $2.4 million resulting primarily from the sale of equity and fixed maturity securities classified as available-for-sale.

During the third quarter of 2023, we recognized through income $7.3 million of net unrealized losses on equity securities. During the third quarter of 2022, we recognized through income $4.1 million of net unrealized losses on equity securities.

During the nine months ended September 30, 2023, we recognized through income $3.9 million of net unrealized losses on equity securities. During the nine months ended September 30, 2022, we recognized through income $13.0 million of net unrealized losses on equity securities.

Investment income is recognized as it is earned. The discount or premium on fixed maturity securities is amortized using the “constant yield” method. Anticipated prepayments, where applicable, are considered when determining the amortization of premiums or discounts. Realized investment gains and losses are determined using the specific identification method.