Investments (Tables)

3 Months Ended

Mar. 31, 2013

Investments [Abstract]

Schedule of investments

The following table summarizes, by type, our investments as of March 31, 2013 and December 31, 2012.

	March 31, 2013					December 31, 2012
	Carrying		Percent			Carrying		Percent
	Amount		of Total			Amount		of Total
	(Dollars in Thousands)
Debt securities, at market:
United States government obligations and authorities	$	24,844		17.53	%	$	27,392		21.06	%
Obligations of states and political subdivisions		3,862		2.73	%		3,939		3.03	%
Corporate		75,800		53.49	%		67,313		51.74	%
International		3,258		2.30	%		3,111		2.39	%
		107,764		76.05	%		101,755		78.22	%
Debt securities, at amortized cost:
United States government obligations and authorities		4,737		3.34	%		6,016		4.62	%
Corporate		2,000		1.41	%		1,203		0.92	%
International		112		0.08	%		140		0.11	%
		6,849		4.83	%		7,359		5.65	%
Total debt securities		114,613		80.88	%		109,114		83.87	%
Equity securities, at market:		27,108		19.12	%		20,982		16.13	%
Total investments	$	141,721		100.00	%	$	130,096		100.00	%

Realized gains (losses)

The following table shows the realized gains (losses) for debt and equity securities for the three months ended March 31, 2013 and 2012.

	Three Months Ended March 31,
	2013					2012
	Gains			Fair Value		Gains			Fair Value
	(Losses)			at Sale		(Losses)			at Sale
	(Dollars in Thousands)
Debt securities	$	1,133		$	22,601	$	233		$	6,496
Equity securities		189			1,079		516			3,073
Total realized gains		1,322			23,680		749			9,569
Debt securities		(409	)		16,476		(206	)		5,042
Equity securities		(100	)		623		(553	)		1,666
Total realized losses		(509	)		17,099		(759	)		6,708
Net realized gains (losses) on investments	$	813		$	40,779	$	(10	)	$	16,277

During the three months ended March 31, 2013 the investment committee decided to shorten the duration of the bond portfolio by approximately one year to prepare for the eventuality of rising interest rates over the next several years. Interest rates and bond prices move inversely, so any rise in interest rates adversely impacts the value of our fixed income portfolio. This impact is magnified when the portfolio is positioned with a longer duration. This decision generated a majority of the approximately $0.8 million in realized gains and also explains the drop in investment income for the quarter measured against the same three month period last year.

Unrealized gain (loss)

A summary of the amortized cost, estimated fair value and gross unrealized gains and losses of debt and equity securities at March 31, 2013 and December 31, 2012 is as follows.

			Gross		Gross
	Amortized		Unrealized		Unrealized		Estimated
	Cost		Gains		Losses		Fair Value
	(Dollars in Thousands)
March 31, 2013
Debt Securities  - Available-For-Sale:
United States government obligations
and authorities	$	24,352	$	502	$	10	$	24,844
Obligations of states and political
subdivisions		3,664		199		1		3,862
Corporate		73,216		2,622		38		75,800
International		3,258		25		25		3,258
	$	104,490	$	3,348	$	74	$	107,764
Debt Securities  - Held-To-Maturity:
United States government obligations
and authorities	$	4,737	$	124	$	-	$	4,861
Corporate		2,000		37		-		2,037
International		112		-		1		111
	$	6,849	$	161	$	1	$	7,009
Equity securities - common stocks	$	22,676	$	4,953	$	521	$	27,108
December 31, 2012
Debt Securities  - Available-For-Sale:
United States government obligations
and authorities	$	26,825	$	632	$	65	$	27,392
Obligations of states and political
subdivisions		3,738		202		1		3,939
Corporate		63,553		3,794		34		67,313
International		3,005		107		1		3,111
	$	97,121	$	4,735	$	101	$	101,755
Debt Securities  - Held-To-Maturity:
United States government obligations
and authorities	$	6,016	$	149	$	12	$	6,153
Corporate		1,203		61		2		1,262
International		140		-		1		139
	$	7,359	$	210	$	15	$	7,554
Equity securities - common stocks	$	19,095	$	2,505	$	618	$	20,982

Continuous unrealized loss position

The table below reflects our unrealized investment losses by investment class, aged for length of time in a continuous unrealized loss position as of March 31, 2013.

	Unrealized Losses		Less than 12 months		12 months or longer
	(Dollars in Thousands)
Debt securities:
United States government obligations
and authorities	$	10	$	10	$	-
Obligations of states and political subdivisions		1		1		-
Corporate		38		38		-
International		25		25		-
		74		74		-
Equity securities:
Common stocks		521		254		267
Total debt and equity securities	$	595	$	328	$	267

The table below reflects our unrealized investment losses by investment class, aged for length of time in a continuous unrealized loss position as of December 31, 2012.

	Unrealized Losses		Less than 12 months		12 months or longer
	(Dollars in Thousands)
Debt securities:
United States government obligations
and authorities	$	65	$	65	$	-
Obligations of states and political subdivisions		1		1		-
Corporate		34		34		-
International		1		1		-
		101		101		-
Equity securities:
Common stocks		618		430		188
Total debt and equity securities	$	719	$	531	$	188

Investments classified by contractual maturity date

Below is a summary of debt securities at March 31, 2013 and December 31, 2012, by contractual or expected maturity periods. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

	March 31, 2013				December 31, 2012
	Amortized		Estimated		Amortized		Estimated
	Cost		Fair Value		Cost		Fair Value
	(Dollars in Thousands)
Due in one year or less	$	2,264	$	2,295	$	2,925	$	2,944
Due after one through five years		70,955		72,528		49,826		51,523
Due after five through ten years		37,384		39,122		35,070		37,182
Due after ten years		736		828		16,659		17,660
Total	$	111,339	$	114,773	$	104,480	$	109,309

Investment income

The table below sets forth investment results for the three months ended March 31, 2013 and 2012.

	Three Months Ended March 31,
	2013		2012
	(Dollars in Thousands)
Interest on debt securities	$	714	$	878
Dividends on equity securities		80		82
Interest on cash and cash equivalents		-		1
Total investment income	$	794	$	961
Net realized gains (losses)	$	813	$	(10	)

Net realized and unrealized investment gains (losses)

The table below sets forth a summary of net realized and unrealized investment gains during the three months ended March 31, 2013 and 2012.

	Three Months Ended March 31,
	2013		2012
	(Dollars in Thousands)
Net realized gains
Debt securities	$	724	$	27
Equity securities		89		(37	)
Total	$	813	$	(10	)
Net unrealized gains
Debt securities	$	3,275	$	2,365
Equity securities		4,431		924
Total	$	7,706	$	3,289