G. Debt

Debt consists of the following:

	June 30, 2013				December 31, 2012				June 30, 2012
	Carrying		Fair Value		Carrying		Fair Value		Carrying		Fair Value
	Value		Level 2		Value		Level 2		Value		Level 2
(In thousands)
5.5% Senior notes	$	-	$	-	$	99,000	$	100,485	$	99,000	$	100,955
5.875% Senior notes		100,000		104,125		100,000		106,250		100,000		99,950
0% Subordinated debentures		17,028		18,924		17,366		19,638		66,598		75,184
Total	$	117,028	$	123,049	$	216,366	$	226,373	$	265,598	$	276,089

5.5% Senior notes

On May 15, 2003, the Company issued 10-year, $100 million senior notes, of which $99 million was outstanding at December 31, 2012 and June 30, 2012. These senior notes matured and were repaid on May 15, 2013. They paid interest semi-annually at 5.5%.

5.875% Senior notes

On May 31, 2011, the Company issued 10-year, $100 million senior notes. The notes mature on June 1, 2021 and bear interest at 5.875% per annum, payable semi-annually on June 1 and December 1 of each year and commenced on December 1, 2011. Upon the occurrence of a change of control triggering event, as defined in the indenture, the Company would be required to offer to repurchase the notes at 101% of their principal amount.

Zero coupon Subordinated debentures due December 31, 2015

On December 31, 2010, the Company issued $86.4 million in par value of five year zero coupon subordinated debentures due December 31, 2015 ("Debentures") to its shareholders of record on December 15, 2010 through the declaration of a special dividend of $3.20 per share. The Debentures have a par value of $100 and are callable at the option of the Company, in whole or in part, at any time or from time to time, at a redemption price equal to 100% of the principal amount of the Debentures to be redeemed. During the three month period ended June 30, 2013, the Company repurchased 11,942 Debentures having a face value of $1.2 million. The redemptions were accounted for as extinguishments of debt and resulted in a loss of $137,000. There were no repurchases during the three month period ended June 30, 2012. During the six month periods ended June 30, 2013 and June 30, 2012, the Company repurchased 11,974 Debentures and 229 Debentures, respectively, having a face value of $1.2 million and $22,900, respectively. The redemptions were accounted for as extinguishments of debt and resulted in a loss of $137,000 and a loss of $1,000, respectively. Gains and losses from the extinguishment of debt are included in net gain/(loss) from investments on the condensed consolidated statements of income. The debt is being accreted to its face value using the effective rate on the date of issuance of 7.45%. At June 30, 2013, December 31, 2012 and June 30, 2012, the debt was recorded at its accreted value of $17.0 million, $17.4 million and $66.6 million, respectively.

The fair value of the Company's debt, which is a Level 2 valuation, is estimated based on either quoted market prices for the same or similar issues or on the current rates offered to the Company for debt of the same remaining maturities or using market standard models. Inputs in these standard models include credit rating, maturity and interest rate.

On May 30, 2012, the Securities and Exchange Commission ("SEC") declared effective the "shelf" registration statement filed by the Company. The "shelf" provides the Company with the flexibility of issuing any combination of senior and subordinated debt securities, convertible securities and common and preferred securities up to a total amount of $500 million and replaced the existing shelf registration which expired in July 2012. As of June 30, 2013, $400 million is available on the shelf.