Income Taxes (Tables)

12 Months Ended

Dec. 31, 2019

Schedule of Company's Deferred Income Tax Assets and Liabilities

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

	December 31,
	2019			2018
	(in thousands)
Deferred income tax assets:
Discounting of net unpaid loss and loss adjustment expenses	$	19,985		$	21,377
Unearned premiums		7,638			8,069
Accrued expenses and other		2,612			2,636
State income tax		2,484			855
Accrued policyholder dividends		2,330			2,188
Impaired securities		—			21
Capital loss carryforward		20			—
Accrued insurance-related assessments		2,672			3,139
Net unrealized loss on securities		—			496
Total deferred tax assets		37,741			38,781
Less: Valuation allowance		(2,025	)		—
Net deferred tax assets		35,716			38,781

Deferred income tax liabilities:
Deferred policy acquisition costs		(4,838	)		(5,207	)
Callable bond amortization		(2	)		(5	)
Unrealized gain on securities available-for-sale		(3,970	)		—
Property and equipment and other		(271	)		(178	)
Salvage and subrogation		(636	)		(719	)
Loss reserves adjustment due to the Tax Act		(8,486	)		(10,820	)
Total deferred income tax liabilities		(18,203	)		(16,929	)
Net deferred income taxes	$	17,513		$	21,852

Components of Consolidated Income Tax Expense (Benefit)

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

	Year Ended December 31,
	2019		2018			2017
	(in thousands)
Current:
Federal	$	20,658	$	16,407		$	22,477
State		1,297		1,004			732
		21,955		17,411			23,209
Deferred:
Federal		732		(1,389	)		12,965
State		140		(73	)		(165	)
		872		(1,462	)		12,800
Total	$	22,827	$	15,949		$	36,009

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 21% in 2019 and 2018, and 35% in 2017 to income before income taxes as follows:

	Year Ended December 31,
	2019			2018			2017
	(in thousands)
Income tax computed at federal statutory tax rate	$	24,258		$	18,392		$	28,784
Tax-exempt interest, net		(2,999	)		(2,965	)		(5,707	)
State income tax		1,178			720			311
Dividends received deduction		(59	)		(44	)		(48	)
Revaluation of net deferred income tax assets		—			—			12,620
Other		449			(154	)		49
	$	22,827		$	15,949		$	36,009