Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Schedule of Company's Deferred Income Tax Assets and Liabilities

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

	December 31,
	2020			2019
	(in thousands)
Deferred income tax assets:
Discounting of net unpaid loss and loss adjustment expenses	$	19,297		$	19,985
Unearned premiums		6,984			7,638
Accrued expenses and other		2,947			2,612
State income tax		2,212			2,484
Accrued policyholder dividends		2,020			2,330
Capital loss carryforward		—			20
Accrued insurance-related assessments		1,963			2,672
Total deferred tax assets		35,423			37,741
Less: Valuation allowance		(2,169	)		(2,025	)
Net deferred tax assets		33,254			35,716

Deferred income tax liabilities:
Deferred policy acquisition costs		(4,547	)		(4,838	)
Callable bond amortization		—			(2	)
Unrealized gain on securities available-for-sale		(7,194	)		(3,970	)
Property and equipment and other		(260	)		(271	)
Salvage and subrogation		(516	)		(636	)
Loss reserves adjustment due to the Tax Act		(7,072	)		(8,486	)
Total deferred income tax liabilities		(19,589	)		(18,203	)
Net deferred income taxes	$	13,665		$	17,513

Components of Consolidated Income Tax Expense (Benefit)

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

	Year Ended December 31,
	2020		2019		2018
	(in thousands)
Current:
Federal	$	17,760	$	20,658	$	16,407
State		900		1,297		1,004
		18,660		21,955		17,411
Deferred:
Federal		1,403		732		(1,389	)
State		254		140		(73	)
		1,657		872		(1,462	)
Total	$	20,317	$	22,827	$	15,949

Income Tax Expense from Operations from the Amount Computed by Applying the U.S. Federal Income Tax Statutory Rate of 21% 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% to income before income taxes as follows:

	Year Ended December 31,
	2020			2019			2018
	(in thousands)
Income tax computed at federal statutory tax rate	$	22,453		$	24,258		$	18,392
Tax-exempt interest, net		(3,226	)		(2,999	)		(2,965	)
State income tax		1,080			1,178			720
Dividends received deduction		(89	)		(59	)		(44	)
Other		99			449			(154	)
	$	20,317		$	22,827		$	15,949