Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Schedule of Company's Deferred Income Tax Assets and Liabilities

The Company’s deferred income tax assets and liabilities are as follows:

	December 31,
	2017			2016
	(in thousands)
Deferred income tax assets:
Discounting of net unpaid loss and loss adjustment expenses	$	8,830		$	16,035
Unearned premiums		8,466			14,483
Accrued expenses and other		2,359			3,640
State income tax		782			617
Accrued policyholder dividends		1,918			2,024
Impaired securities		42			70
Capital loss carryforward		190			15
Accrued insurance-related assessments		3,256			5,323
Net unrealized loss on securities		—			265
Total deferred tax assets		25,843			42,472
Deferred income tax liabilities:
Deferred policy acquisition costs		(5,317	)		(8,492	)
Callable bond amortization		(8	)		(10	)
Unrealized gain on securities available-for-sale		(1,070	)		—
Property and equipment and other		(3	)		204
Salvage and subrogation		(183	)		(363	)
Total deferred income tax liabilities		(6,581	)		(8,661	)
Net deferred income taxes	$	19,262		$	33,811

Components of Consolidated Income Tax Expense (Benefit)

The components of consolidated income tax expense (benefit) are as follows:

	Year Ended December 31,
	2017			2016			2015
	(in thousands)
Current:
Federal	$	22,477		$	35,602		$	28,047
State		732			1,603			1,012
		23,209			37,205			29,059
Deferred:
Federal		12,965			(2,120	)		1,343
State		(165	)		(129	)		103
		12,800			(2,249	)		1,446
Total	$	36,009		$	34,956		$	30,505

Income Tax Expense from Operations from the Amount Computed by Applying the U.S. Federal Income Tax Statutory Rate of 35% to Income Before Income Taxes

Income tax expense from operations is different from the amount computed by applying the U.S. federal income tax statutory rate of 35% to income before income taxes as follows:

	Year Ended December 31,
	2017			2016			2015
	(in thousands)
Income tax computed at federal statutory tax rate	$	28,784		$	39,487		$	35,338
Tax-exempt interest, net		(5,707	)		(5,370	)		(5,630	)
State income tax		311			913			762
Dividends received deduction		(48	)		(125	)		(19	)
Revaluation of net deferred income tax assets		12,620			—			—
Other		49			51			54
	$	36,009		$	34,956		$	30,505