Deferred Policy Acquisition Costs

3 Months Ended

Mar. 31, 2013

Deferred Policy Acquisition Costs [Abstract]

DEFERRED ACQUISITION COSTS

Policy acquisition costs consist primarily of commissions, premium taxes, and underwriting and agency expenses incurred related to successful efforts to acquire new or renewal insurance contracts, net of ceding commission income, and vehicle service agreements. Acquisition costs deferred on both property and casualty insurance products and vehicle service agreements are amortized over the period in which the related revenues are earned.

The components of deferred acquisition costs and the related amortization expense for the three months ended March 31, 2013 and 2012, respectively, is comprised as follows:



(in thousands)	March 31
	2013		2012
Beginning balance, net	14,102		8,116
Additions	9,172		6,209
Amortization	(10,589	)	(5,922	)
Balance at March 31, net	12,685		8,403

- Definition

Disclosure of accounting policy for capitalizing costs incurred to write or acquire insurance contracts, the basis for and methodology for capitalizing such costs, the accounting for such deferred acquisition costs (DAC) when modifications or internal replacements of related insurance contracts occur and the effect on results of operations, and the methodology and amount of amortization. This disclosure addresses the nature, type, and amount of capitalized costs incurred to write or acquire insurance contracts.

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