10-K/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(Amendment No.1)

☑ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2016

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from  to

COMMISSION FILE NUMBER 001-33865

Triple-S Management Corporation

Puerto Rico	66-0555678
(STATE OF INCORPORATION)	(I.R.S. ID)

1441 F.D. Roosevelt Avenue, San Juan, PR 00920

(787) 749-4949

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Class B common stock, $1.00 par value	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: Class A common stock, $1.00 par value

Indicate by check mark if the registrant is well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☐  Yes  ☑ No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.☐  Yes  ☑  No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☑  Yes☐  No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). ☑  Yes☐ No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See definition of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  ☐	Accelerated filer  ☑
Non-accelerated filer  ☐	Smaller reporting company  ☐
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).

☐  Yes  ☑  No

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June 30, 2016 was approximately $577,239,532 for the Class B common stock (the only stock of the registrant that trades in a public market) and $950,968 for the Class A common stock (valued at its par value of $1.00 since it is not publicly traded).

As of February 28, 2017, the registrant had 950,968 of its Class A common stock outstanding and 23,320,899 of its Class B common stock outstanding.

Explanatory Note

This amendment No. 1 on Form 10-K/A (“Amended Filing”) amends our original Annual Report on Form 10-K for the year ended December 31, 2016 filed on March 9, 2017 (“Original Filing”). The purpose of this Amended Filing is to (i) amend and restate management’s conclusions regarding the effectiveness of our disclosure controls and procedures and internal control over financial reporting as of December 31, 2016, and (ii) file the amended and restated “Report of Independent Registered Certified Public Accounting Firm” of Deloitte & Touche LLP regarding the effectiveness of our internal control over financial reporting as of December 31, 2016. As required by Rule 12b-15, the Company’s principal executive officer and principal financial officer are providing new currently dated certifications. In addition, the Company is filing new consents of Independent Registered Public Accounting Firm from Deloitte & Touche LLP and PricewaterhouseCoopers LLP.  Accordingly, the Company hereby amends and replaces in its entirety Items 9A and 15 in the Original Filing.

Except as described above, this Amended Filing does not amend, modify or change any items or disclosures contained in our Original Filing and does not intend to reflect any information or events subsequent to the filing date of the Original Filing. As such, the Company’s consolidated financial statements as of and for the year ended December 31, 2016, which were included in the Original Filing, have not changed as a result of the identification of the material weakness. This Amended Filing should be read in conjunction with the Original Filing and reports filed with the U.S. Securities and Exchange Commission subsequent to the Original Filing, including any amendment to those filings.

As described in Item 9A of this Amended Filing, subsequent to our Original Filing, as the result of an inspection from the Public Company Accounting Oversight Board, our independent registered public accounting firm requested that we re-evaluate certain internal controls related to the review process of the Managed Care claims paid data input in our incurred but not reported (“IBNR”) actuarial model. As a result, management has concluded that disclosure controls and procedures and internal control over financial reporting were not effective as of December 31, 2016 due to a material weakness in its internal control over financial reporting identified subsequent to the issuance of the Original Filing. The Company’s consolidated financial statements as of and for the year ended December 31, 2016, which were included in the Original Filing, have not changed as a result of the identification of the material weakness.

Part II

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosures

There have been no changes in or disagreements with our independent registered public accounting firm on accounting or financial disclosures.

Item 9A. Controls and Procedures

Page 2

Evaluation of Disclosure Controls and Procedures

In connection with the preparation of the Original Filing and, subsequently, of this Annual Report on Form 10-K/A, management, under the supervision and with the participation of the chief executive officer and the chief financial officer, conducted an evaluation of the effectiveness of our “disclosure controls and procedures” as of the end of this period (as such term is defined under Exchange Act Rule 13a-15(e)) of the Corporation and its subsidiaries. Disclosure controls and procedures are designed to ensure that information required to be disclosed by the issuer in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms and that such information is accumulated and communicated to management, including the chief executive officer and chief financial officer, to allow timely decisions regarding required disclosures. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility that judgments in decision-making can be faulty, and breakdowns as a result of simple errors or mistake.  Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions.

Based on the evaluation at the time of the Original Filing, our chief executive officer and chief financial officer concluded that as of December 31, 2016, which is the end of the period covered by this Annual Report on Form 10-K, our disclosure controls and procedures were effective to a reasonable level of assurance. Subsequent to this evaluation, our chief executive officer and chief financial officer concluded that our disclosure controls and procedures were not effective as of December 31, 2016 because of the material weakness in internal control over financial reporting described below.

Notwithstanding the material weakness in our internal control over financial reporting as of December 31, 2016, management has concluded that the consolidated financial statements included in the Original Filing and in this Form 10-K/A present fairly, in all material respects, our financial position, results of operations and cash flows for the periods presented.

Management’s Report on Internal Control Over Financial Reporting (as revised)

Management is responsible for establishing and maintaining adequate internal control over financial reporting and for the assessment of the effectiveness of “internal control over financial reporting,” as defined under Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting is a process designed by, or under the supervision of, the Company’s chief executive officer and chief financial officer, and effected by the Company’s board of directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s consolidated financial statements for external purposes in accordance with generally accepted accounting principles (“GAAP”), and includes those policies and procedures that:

· pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the Company;

· provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

· provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s assets that could have a material effect on the consolidated financial statements.

A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the annual or interim financial statements will not be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.  Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Management, under the supervision and with the participation of the chief executive officer and chief financial officer, assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2016 based on criteria described in the “Internal Control—Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) on May 14, 2013.  Based on that assessment and those criteria, management has concluded that the Company’s internal control over financial reporting was not effective as of December 31, 2016 to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Company’s consolidated financial statements for external reporting purposes in accordance with GAAP due to the material weakness described below.

Page 3

Subsequent to our Original Filing, as the result of an inspection from the Public Company Accounting Oversight Board, our independent registered public accounting firm requested that we re-evaluate certain internal controls related to the review process of the Managed Care claims paid data input in our IBNR actuarial model. As the result of this re-evaluation, management determined that controls are not appropriately designed to validate that the claims paid information in the lag triangles used in the IBNR actuarial models is reviewed with enough precision to ascertain data is accurately presented by incurred date.  This deficiency was determined to be a material weakness as of December 31, 2016. The Company’s consolidated financial statements as of and for the year ended December 31, 2016, as included in the Original Filing, have not changed as a result of the identification of this material weakness.

The effectiveness of our internal control over financial reporting as of December 31, 2016 has been audited by Deloitte & Touche, LLP, an independent registered public accounting firm, as stated in their report which is included in this Annual Report on Form 10-K/A.

Remediation Plan

The main factor contributing to the material weakness were changes in our actuarial department during 2016. As a consequence, the preventive control over the accuracy of the incurred date component of the Managed Care claims paid data within the claim lags ceased to be fully effective. Although we engaged an external actuarial consulting firm to support our claims reserving process, we did not ask them to do detailed testing over the incurred date component in order to ascertain the preciseness of the lag triangles. Even though this control deficiency is considered a material weakness, there is no adjustment to the previously issued financial statements.

Management has designed a remediation plan to correct the material weakness described above and improve the design of internal controls. The remedial activities put in place include the following:

· After hiring additional personnel in the actuarial department, effective 2017 we reinforced the review process over the accuracy of the claims paid data within the claim lags.

· In addition, we strengthened the claims paid reconciliation process to include the incurred date component within the claim lags on a monthly and historical basis.

We have completed the aforementioned activities as of the date of this amendment and believe that we have strengthened the Company’s internal control over financial reporting addressing the identified material weakness. However, control weaknesses are not considered remediated until new internal controls have been operational for a period of time, are tested, and management concludes that these controls are operating effectively. We will continue to monitor the effectiveness of these remediation measures and we will make any changes to the design of this plan and take such other actions that we deem appropriate given the circumstances.

Page 4

Changes in Internal Control Over Financial Reporting

No changes in our internal control over financial reporting (as such term is defined in the Exchange Act Rule 13a-15(f)) occurred during the fiscal quarter ended December 31, 2016 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Report of Independent Registered Public Accounting Firm

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Triple-S Management Corporation:

We have audited Triple-S Management Corporationand its subsidiaries (the "Company's") internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control — Integrated Framework(2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting (as revised). Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

A company's internal control over financial reporting is a process designed by, or under the supervision of, the company's principal executive and principal financial officers, or persons performing similar functions, and effected by the company's board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Page 5

In our report dated March 9, 2017, we expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.  As described in the following paragraph, the Company subsequently identified a material weakness in its internal control over financial reporting. Accordingly, management has revised its assessment about the effectiveness of the Company’s internal control over financial reporting and our present opinion on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2016, as expressed herein, is different from that expressed in our previous report.

A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be prevented or detected on a timely basis.  The following material weakness has been identified and included in management's assessment: the managed care segment controls are not appropriately designed to validate that the claims paid information in the lag triangles used in the IBNR actuarial models is reviewed with enough precision to ascertain data is accurately presented by incurred date. This material weakness was considered in determining the nature, timing, and extent of audit tests applied in our audit of the consolidated financial statements and financial statement schedules as of and for the year ended December 31, 2016, of the Company and this report does not affect our report on such consolidated financial statements and financial statement schedules.

In our opinion, because of the effect of the material weakness identified above on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial reporting as of December 31, 2016, based on the criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the consolidated financial statements and financial statement schedules as of and for the year ended December 31, 2016 of the Company and our report dated March 9, 2017 expressed an unqualified opinion on those financial statements and financial statement schedules.

/s/ DELOITTE & TOUCHE LLP

San Juan, Puerto Rico

March 9, 2017 (August 9, 2017 as to the material weakness)

Stamp No. E286206

affixed to original.

Part III

Item 15. Exhibits and Financial Statements Schedules

Financial Statements and Schedules

Financial Statements	Description
F-1	Reports of Independent Registered Public Accounting Firm
F-2	Consolidated Balance Sheets as of December 31, 2016 and 2015
F-3	Consolidated Statements of Earnings for the years ended December 31, 2016, 2015 and 2014
F-4	Consolidated Statements of Comprehensive Income for the years ended December 31, 2016, 2015 and 2014
F-5	Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2016, 2015 and 2014
F-6	Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014
F-7	Notes to Consolidated Financial Statements – December 31, 2016, 2015 and 2014

Page 6

Financial Statements Schedules	Description
S-1	Schedule II – Condensed Financial Information of the Registrant
S-2	Schedule III – Supplementary Insurance Information
S-3	Schedule IV – Reinsurance
S-4	Schedule V – Valuation and Qualifying Accounts

Schedule I – Summary of Investments was omitted because the information is disclosed in the notes to the audited consolidated financial statements.  Schedule VI – Supplemental Information Concerning Property Casualty Insurance Operations was omitted because the schedule is not applicable to the Corporation.

Exhibits

Exhibits	Description
3(i)(a)	Amended and Restated Articles of Incorporation (incorporated herein by reference to Exhibit 3(i)(d) to TSM’s Annual Report on Form 10-K for the Year Ended December 31, 2007 (File No. 001-33865).
3(i)(b)	Amendment to Article Tenth of the Amended and Restated Articles of Incorporation of Triple-S Management Corporation, incorporated by reference to Exhibit 3(i)(b) to TSM’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 (File No. 001-33865).
3(i)(c)	Articles of Incorporation of Triple-S Management Corporation, as currently in effect, incorporated by reference to Exhibit 3(i)(c) to TSM’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2008 (File No. 001-33865).
3(ii)	Amended and Restated Bylaws of Triple-S Management Corporation (incorporated herein by reference to Exhibit 3.1 to TSM’s Current Report on Form 8-K filed on June 11, 2010 (File No. 001-33865)).
10.1	Agreement between the Puerto Rico Health Insurance Administration and TSS for the provision of the physical & behavioral health services under the Government Health Plan Program (incorporated herein by reference to Exhibit 10.1 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2014  (File No. 001-33865)).
10.2	Amended and Restated Agreement between the Puerto Rico Health Insurance Administration and TSS to administer the provision of the physical health component of the Medicaid program in designated service regions (incorporated herein by reference to Exhibit 10.1 to TSM’s Quarterly Report on Form 10-Q filed on August 8, 2013 (File No. 001-33865)).
10.4	Federal Employees Health Benefits Contract (incorporated herein by reference to Exhibit 10.5 to TSM's General Form of Registration of Securities on Form 10 (File No. 001-33865)).
10.5	Credit Agreement with FirstBank Puerto Rico in the amount of $41,000,000 (incorporated herein by reference to Exhibit 10.6 to TSM's General Form of Registration of Securities on Form 10 (File No. 001-33865)).

Page 7

Exhibits	Description
10.6	Credit Agreement with FirstBank Puerto Rico in the amount of $20,000,000 (incorporated herein by reference to Exhibit 10.7 to TSM's General Form of Registration of Securities on Form 10 (File No. 001-33865)).
10.7	Non-Contributory Retirement Program (incorporated herein by reference to Exhibit 10.8 to TSM's General Form of Registration of Securities on Form 10 (File No. 001-33865)).
10.8	Blue Shield License Agreement by and between BCBSA and TSM, including revisions, if any, adopted by Member Plans through the November 19, 2009 meeting (incorporated herein by reference to Exhibit 10.11 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2009 (File No. 001-33865)).
10.9	Blue Shield Controlled Affiliate License Agreement by and among BCBSA, TSS and TSM, including revisions, if any, adopted by Member Plans through the November 19, 2009 meeting (incorporated herein by reference to Exhibit 10.12 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2009 (File No. 001-33865)).
10.10	Blue Cross License Agreements by and between BCBSA and TSM, including revisions, if any, adopted by Member Plans through the November 19, 2009 meeting (incorporated herein by reference to Exhibit 10.13 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2009 (File No. 001-33865)).
10.11	Blue Cross Controlled Affiliate License Agreement by and among BCBSA, TSS and TSM, including revisions, if any, adopted by Member Plans through the November 19, 2009 meeting (incorporated herein by reference to Exhibit 10.14 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2009 (File No. 001-33865)).
10.12	6.30% Senior Unsecured Notes Due September 2019 Note Purchase Agreement, dated September 30, 2004, between Triple-S Management Corporation, Triple-S, Inc. and various institutional accredited investors (incorporated herein by reference to Exhibit 10.15 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2005 (File No. 001-33865)).
10.13	6.60% Senior Unsecured Notes Due December 2020 Note Purchase Agreement, dated December 15, 2005, between Triple-S Management Corporation and various institutional accredited investors (incorporated herein by reference to Exhibit 10.16 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2005 (File No. 001-33865)).
10.14	6.70% Senior Unsecured Notes Due December 2021 Note Purchase Agreement, dated January 23, 2006, between Triple-S Management Corporation and various institutional accredited investors (incorporated herein by reference to Exhibit 10.1 to TSM’s Quarterly Report on Form 10-Q for the Quarter Ended March 31, 2006 (File No. 001-33865)).
10.15	TSM 2007 Incentive Plan, dated October 16, 2007 (incorporated herein by reference to Exhibit C to TSM’s 2007 Proxy Statement (File No. 001-33865)).

Page 8

Exhibits	Description
10.16	Software License and Maintenance Agreement between Quality Care Solutions, Inc, and TSS dated August 16, 2007 (incorporated herein by reference to Exhibit 10.15 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-33865)).
10.17	Addendum Number One to the Software License and Maintenance Agreement between Quality Care Solutions, Inc, and TSS (incorporated herein by reference to Exhibit 10.15(a) to TSM’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-33865)).
10.18	Addendum Number Two to the Software License and Maintenance Agreement between Quality Care Solutions, Inc, and TSS (incorporated herein by reference to Exhibit 10.15(b) to TSM’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-33865)).
10.19	Addendum Number Three to the Software License and Maintenance Agreement between Quality Care Solutions, Inc, and TSS (incorporated herein by reference to Exhibit 10.15(c) to TSM’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-33865)).
10.20	Work Order Agreement between Quality Care Solutions, Inc. and TSS (incorporated herein by reference to Exhibit 10.16 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2007 (File No. 001-33865)).
10.21	Employment Contract between Ramón M. Ruiz Comas and TSM (incorporated herein by reference to Exhibit 10.1 to TSM’s Current Report on Form 8-K filed on November 5, 2012 (File No. 001-33865)).
10.22	Settlement and Release Agreement between Triple-S Management Corporation, Triple-S Salud, Inc., and the Health Insurance Administration of Puerto Rico (incorporated herein by reference to Exhibit 10.22 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2015 (File No. 001-33865)).
10.23	Resolution Agreement between Triple-S Management Corporation, Triple-S Salud, Inc., and the Department of Health and Human Services (incorporated herein by reference to Exhibit 10.23 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2015 (File No. 001-33865)).
10.24	Employment Contract between Roberto García-Rodríguez and TSM (incorporated herein by reference to Exhibit 10.1 to TSM’s Current Report on Form 8-K/A filed on January 6, 2016 (File No. 001-33865)).
10.25	Credit Agreement dated December 28, 2016 by and between Triple-S Management Corporation and FirstBank Puerto Rico (incorporated herein by reference to Exhibit 10.1 to TSM’s Current Report on Form 8-K filed on December 30, 2016 (File No. 001-33865)).
11.1	Statement re computation of per share earnings; an exhibit describing the computation of the earnings per share has been omitted as the detail necessary to determine the computation of earnings per share can be clearly determined from the material contained in Part II of this Annual Report on Form 10-K.
21	List of Subsidiaries of TSM (incorporated herein by reference to Exhibit 21 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2014 (File No. 001-33865)).

Page 9

Exhibits	Description
23.1*	Consent of Independent Registered Public Accounting Firm (Deloitte & Touche LLP).
23.2*	Consent of Independent Registered Public Accounting Firm (PricewaterhouseCoopers LLP).
31.1*	Certification of the President and Chief Executive Officer required by Rule 13a-14(a)/15d-14(a).
31.2*	Certification of the Vice President of Finance and Chief Financial Officer required by Rule 13a-14(a)/15d-14(a).
32.1*	Certification of the President and Chief Executive Officer required pursuant to 18 U.S. Section 1350.
32.2*	Certification of the Vice President of Finance and Chief Financial Officer required pursuant to 18 U.S. Section 1350.
99.1	Incentive Compensation Recoupment Policy (incorporated herein by reference to Exhibit 99.1 to TSM’s Annual Report on Form 10-K for the year ended December 31, 2010 (File No. 001-33865)).

All other exhibits for which provision is made in the applicable accounting regulation of the SEC are not required under the related instructions or are inapplicable, and therefore have been omitted.

* Filed herein.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Triple-S Management Corporation

Registrant

By:	/s/ Roberto García-Rodríguez	Date:	August 9, 2017
	Roberto García-Rodríguez
	President and Chief Executive Officer
By:	/s/ Juan J. Román-Jiménez	Date:	August 9, 2017
	Juan J. Román-Jiménez
	Executive Vice President
	and Chief Financial Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Page 10

By:	/s/ Luis A. Clavell-Rodríguez	Date:	August 9, 2017
	Luis A. Clavell-Rodríguez
	Director and Chairman of the Board
By:	/s/ Cari M. Domínguez	Date:	August 9, 2017
	Cari M. Domínguez
	Director and Vice-Chairman of the Board
By:	/s/ David H. Chafey, Jr.	Date:	August 9, 2017
	David H. Chafey, Jr.
	Director
By:	/s/ Gail B. Marcus	Date:	August 9, 2017
	Gail B. Marcus
	Director
By:	/s/ Jorge L. Fuentes-Benejam	Date:	August 9, 2017
	Jorge L. Fuentes-Benejam
	Director
By:	/s/ Antonio F. Faría-Soto	Date:	August 9, 2017
	Antonio F. Faría-Soto
	Director
By:	/s/ Manuel Figueroa-Collazo	Date:	August 9, 2017
	Manuel Figueroa-Collazo
	Director
By:	/s/ Joseph A.  Frick	Date:	August 9, 2017
	Joseph A.  Frick
	Director
By:	/s/ Roberto Santa María-Ros	Date:	August 9, 2017
	Roberto Santa María-Ros
	Director

Page 11

Triple-S Management Corporation

Consolidated Financial Statements

December 31, 2016, 2015, and 2014

	Page(s)
Reports of Independent Registered Public Accounting Firm	1
Consolidated Financial Statements
Consolidated Balance Sheets	3
Consolidated Statements of Earnings	4
Consolidated Statements of Comprehensive Income	5
Consolidated Statements of Stockholders’ Equity	6
Consolidated Statements of Cash Flows	7
Notes to Consolidated Financial Statements	9–82

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of

Triple-S Management Corporation:

We have audited the accompanying consolidated balance sheets of Triple-S Management Corporation and its subsidiaries (the "Company") as of December 31, 2016 and 2015 and the related consolidated statements of earnings, comprehensive income,stockholders' equity, and cash flows for the two years then ended. Our audits also included the financial statement schedules listed in the Index at Item 15. These financial statements and financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on the financial statements and financial statement schedules based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Triple-S Management Corporation and its subsidiaries as of December 31, 2016 and 2015, and the results of their operations and their cash flows for the two years then ended, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States), the Company's internal control over financial reporting as of December 31, 2016, based on the criteria established in InternalControl — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated March 9, 2017 (August 9, 2017 as to the material weakness) expressed an adverse opinion on the Company's internal control over financial reporting because of a material weakness.

/s/ DELOITTE & TOUCHE LLP

San Juan, Puerto Rico

March 9, 2017

Stamp No. E242723

affixed to original.

1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Triple-S Management Corporation:

In our opinion, the accompanying consolidated statements of earnings, comprehensive income, of stockholders’ equity and of cash flows present fairly, in all material respects, the results of operations and cash flows of Triple-S Management Corporation and its subsidiaries for the year ended December 31, 2014, in conformity with accounting principles generally accepted in the United States of America. In addition, in our opinion, the financial statement schedules for the year ended December 31, 2014 listed in the index appearing under Item 15 present fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. These financial statements and financial statement schedules are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and financial statement schedules based on our audit. We conducted our audit of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

San Juan, Puerto Rico

March 17, 2015

CERTIFIED PUBLIC ACCOUNTANTS

(OF PUERTO RICO)

License No. LLP-216 Expires Dec. 1, 2019

Stamp E257041 of the P.R. Society of

Certified Public Accountants has been

affixed to the file copy of this report

PricewaterhouseCoopers LLP, 254 Muñoz Rivera, Oriental Center, Suite 900, San Juan, PR 00918

T: (787) 754 9090, F: (787) 766 1094, www.pwc.com/us

2

Triple-S Management Corporation

Consolidated Balance Sheets

December 31, 2016 and 2015

(dollar amounts in thousands, except share data)

Assets	2016			2015
Investments and cash
Securities available for sale, at fair value:
Fixed maturities (amortized cost of $1,104,303 in 2016 and $1,088,258 in 2015)	$	1,151,643		$	1,133,645
Equity securities (cost of $240,699 in 2016 and $169,593 in 2015)		270,349			197,071
Securities held to maturity, at amortized cost:
Fixed maturities (fair value of $3,012 in 2016 and $3,124 in 2015)		2,836			2,929
Policy loans		8,564			7,901
Cash and cash equivalents		103,428			197,818
Total investments and cash		1,536,820			1,539,364
Premium and other receivables, net		286,365			282,646
Deferred policy acquisition costs and value of business acquired		194,787			190,648
Property and equipment, net		66,369			73,953
Deferred tax asset		57,768			52,361
Goodwill		25,397			25,397
Other assets		51,493			41,776
Total assets	$	2,218,999		$	2,206,145
Liabilities and Stockholders’ Equity
Claim liabilities		487,943			491,765
Liability for future policy benefits		321,232			289,530
Unearned premiums		79,310			80,260
Policyholder deposits		179,382			179,287
Liability to Federal Employees’ Health Benefits and Federal Employees' Programs		34,370			26,695
Accounts payable and accrued liabilities		169,449			176,910
Deferred tax liability		18,850			15,070
Long term borrowings		35,085			36,827
Liability for pension benefits		30,892			62,945
Total liabilities		1,356,513			1,359,289
Commitments and contingencies
Stockholders’ equity
Triple-S Management Corporation stockholders' equity
Common stock Class A, $1 par value. Authorized 100,000,000 shares; issued and outstanding 950,968 at December 31, 2016 and 2015		951			951
Common stock Class B, $1 par value. Authorized 100,000,000 shares; issued and outstanding 23,321,163 and 24,047,755 shares at December 31, 2016 and 2015, respectively		23,321			24,048
Additional paid-in capital		65,592			83,438
Retained earnings		730,904			713,466
Accumulated other comprehensive income, net		42,395			25,623
Total Triple-S Management Corporation stockholders' equity		863,163			847,526
Non-controlling interest in consolidated subsidiary		(677	)		(670	)
Total stockholders' equity		862,486			846,856
Total liabilities and stockholders’ equity	$	2,218,999		$	2,206,145

The accompanying notes are an integral part of these financial statements.

3

Triple-S Management Corporation

Consolidated Statements of Earnings

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share data)

	2016			2015			2014
Revenues:
Premiums earned, net	$	2,890,641		$	2,783,154		$	2,128,566
Administrative service fees		17,843			44,705			119,302
Net investment income		48,913			45,174			47,540
Other operating revenues		3,461			3,719			4,232
Total operating revenues		2,960,858			2,876,752			2,299,640
Net realized investment gains (losses):
Total other-than-temporary impairment losses on securities		(1,434	)		(5,212	)		(1,170	)
Net realized gains, excluding other-than-temporary impairment losses on securities		18,813			24,153			19,401
Total net realized investment gains on sale of securities		17,379			18,941			18,231
Other income, net		6,569			7,043			2,243
Total revenues		2,984,806			2,902,736			2,320,114
Benefits and expenses:
Claims incurred		2,472,191			2,318,715			1,747,595
Operating expenses		493,894			518,721			497,194
Total operating costs		2,966,085			2,837,436			2,244,789
Interest expense		7,635			8,169			9,274
Total benefits and expenses		2,973,720			2,845,605			2,254,063
Income before taxes		11,086			57,131			66,051
Income tax (benefit) expense		(6,345	)		5,099			745
Net income		17,431			52,032			65,306
Less: Net loss attributable to non-controlling interest		7			89			354
Net income attributable to Triple-S Management Corporation	$	17,438		$	52,121		$	65,660
Earnings per share attributable to Triple-S Management Corporation
Basic net income per share	$	0.71		$	2.03		$	2.42
Diluted net income per share	$	0.71		$	2.02		$	2.41

The accompanying notes are an integral part of these financial statements.

4

Triple-S Management Corporation

Consolidated Statements of Comprehensive Income

December 31, 2016, 2015, and 2014

(dollar amounts in thousands)

	2016			2015			2014
Net income	$	17,431		$	52,032		$	65,306
Other comprehensive income (loss), net of tax:
Net unrealized change in fair value of available for sale securities, net of taxes		(107	)		(38,989	)		35,883
Defined benefit pension plan:
Actuarial gain (loss), net		18,232			16,105			(18,967	)
Prior service credit, net		(1,353	)		(269	)		(269	)
Total other comprehensive income (loss), net of tax		16,772			(23,153	)		16,647
Comprehensive income		34,203			28,879			81,953
Comprehensive loss attributable to non-controlling interest		7			89			354
Comprehensive income attributable to Triple-S Management Corporation	$	34,210		$	28,968		$	82,307

The accompanying notes are an integral part of these financial statements.

5

Triple-S Management Corporation

Consolidated Statements of Stockholders’ Equity

December 31, 2016, 2015, and 2014

(dollar amounts in thousands)

	Class A Common Stock			Class B Common Stock			Additional Paid-in Capital			Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Triple-S Management Corporation Stockholders’ Equity			Non-controlling Interest in Consolidated Subsidiary			Total Stockholders’ Equity
Balance, December 31, 2013	$	2,378		$	25,091		$	130,098		$	595,685	$	32,129		$	785,381		$	(178	)	$	785,203
Share-based compensation		-			135			2,236			-		-			2,371			-			2,371
Stock issued upon exercise of stock options		-			199			2,686			-		-			2,885			-			2,885
Repurchase and retirement of common stock		-			(771	)		(13,615	)		-		-			(14,386	)		-			(14,386	)
Net change in comprehensive income (loss)		-			-			-			65,660		16,647			82,307			(354	)		81,953
Balance, December 31, 2014	$	2,378		$	24,654		$	121,405		$	661,345	$	48,776		$	858,558		$	(532	)	$	858,026
Share-based compensation		-			202			8,088			-		-			8,290			-			8,290
Stock issued upon exercise of stock options		-			13			166			-		-			179			-			179
Common stock conversion		(1,427	)		1,427			-			-		-			-			-			-
Repurchase and retirement of common stock		-			(2,248	)		(46,221	)		-		-			(48,469	)		-			(48,469	)
Non-controlling interest decrease related to retirement of consolidated subsidiary common stock		-			-			-			-		-			-			(49	)		(49	)
Net change in comprehensive income (loss)		-			-			-			52,121		(23,153	)		28,968			(89	)		28,879
Balance, December 31, 2015	$	951		$	24,048		$	83,438		$	713,466	$	25,623		$	847,526		$	(670	)	$	846,856
Share-based compensation		-			223			2,576			-		-			2,799			-			2,799
Stock issued upon exercise of stock options		-			4			51			-		-			55			-			55
Repurchase and retirement of common stock		-			(954	)		(20,473	)		-		-			(21,427	)		-			(21,427	)
Net change in comprehensive income (loss)		-			-			-			17,438		16,772			34,210			(7	)		34,203
Balance, December 31, 2016	$	951		$	23,321		$	65,592		$	730,904	$	42,395		$	863,163		$	(677	)	$	862,486

The accompanying notes are an integral part of these financial statements.

6

Triple-S Management Corporation

Consolidated Statements of Cash Flows

December 31, 2016, 2015, and 2014

(Dollar amounts in thousands)

	2016			2015			2014
Cash flows from operating activities
Net income	$	17,431		$	52,032		$	65,306
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization		14,120			16,379			24,400
Net amortization of investments		8,671			6,854			6,091
Additions to the allowance for doubtful receivables		1,601			16,121			14,819
Deferred tax benefit		(8,326	)		(5,070	)		(21,806	)
Net realized investment gains on sale of securities		(17,379	)		(18,941	)		(18,231	)
Interest credited to policyholder deposits		3,794			5,690			3,510
Share-based compensation		2,463			8,290			2,371
(Increase) decrease in assets
Premium and other receivables, net		(5,320	)		6,399			(45,046	)
Deferred policy acquisition costs and value of business acquired		(7,286	)		(6,548	)		(6,811	)
Deferred taxes		(4,799	)		3,616			1,954
Other assets		(9,009	)		(2,630	)		8,630
(Decrease) increase in liabilities
Claim liabilities		(3,822	)		101,679			(30,335	)
Liability for future policy benefits		31,702			18,146			23,930
Unearned premiums		(950	)		(2,396	)		(4,706	)
Liability to FEHBP		7,675			11,029			7,518
Accounts payable and accrued liabilities		(24,095	)		18,444			6,397
Net cash provided by operating activities		6,471			229,094			37,991

The accompanying notes are an integral part of these financial statements.

7

Triple-S Management Corporation

Consolidated Statements of Cash Flows

December 31, 2016, 2015, and 2014

(Dollar amounts in thousands)

	2016			2015			2014
Cash flows from investing activities
Proceeds from investments sold or matured
Securities available for sale
Fixed maturities sold	$	400,848		$	355,045		$	235,282
Fixed maturities matured		56,988			67,615			31,329
Equity securities sold		109,049			100,152			113,942
Securities held to maturity
Fixed maturities matured		1,538			640			4,127
Other investments		-			-			8,925
Acquisition of investments
Securities available for sale
Fixed maturities		(482,252	)		(469,198	)		(288,507	)
Equity securities		(163,119	)		(92,844	)		(69,101	)
Securities held to maturity
Fixed maturities		(1,445	)		(624	)		(935	)
Other investments		(2,493	)		(2,427	)		(483	)
Net disbursements for policy loans		(663	)		(641	)		(555	)
Net capital expenditures		(4,750	)		(9,094	)		(4,783	)
Net cash (used in) provided by investing activities		(86,299	)		(51,376	)		29,241
Cash flows from financing activities
Repurchase and retirement of common stock		(21,371	)		(48,287	)		(11,337	)
Change in outstanding checks in excess of bank balances		12,250			(1,786	)		(4,858	)
Repayments of long-term borrowings		(1,742	)		(37,640	)		(14,835	)
Proceeds from policyholder deposits		18,224			16,563			9,551
Surrenders of policyholder deposits		(21,923	)		(18,787	)		(10,072	)
Net cash used in financing activities		(14,562	)		(89,937	)		(31,551	)
Net (decrease) increase in cash and cash equivalents		(94,390	)		87,781			35,681
Cash and cash equivalents
Beginning of year		197,818			110,037			74,356
End of year	$	103,428		$	197,818		$	110,037

The accompanying notes are an integral part of these financial statements.

8

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

1. Nature of Business

Triple-S Management Corporation (the Corporation, the Company or TSM) was incorporated under the laws of the Commonwealth of Puerto Rico to engage, among other things, as the holding company of entities primarily involved in the insurance industry.

The Company has the following wholly owned subsidiaries: (1) Triple-S Salud, Inc. (TSS) and Socios Mayores en Salud Holdings, Inc. (from now on referred to as Triple-S Advantage or TSA), managed care organizations that provide health benefits services to subscribers through contracts with hospitals, physicians, dentists, laboratories, and other organizations; (2) Triple-S Vida, Inc. (TSV) and Triple-S Blue, Inc. (TSB) (formerly known as Atlantic Southern Insurance Company (ASICO)), which are engaged in the underwriting of life and accident and health insurance policies and the administration of annuity contracts; and (3)  Triple-S Propiedad, Inc. (TSP), which is engaged in the underwriting of property and casualty insurance policies.  The Company, TSS and TSA are members of the Blue Cross and Blue Shield Association (BCBSA). The Company and the above mentioned subsidiaries are subject directly or indirectly to the regulations of the Commissioner of Insurance of the Commonwealth of Puerto Rico (the Commissioner of Insurance), the General Superintendence of Insurance of Costa Rica, the British Virgin Islands (BVI) Financial Services Commission, and the Anguilla Financial Services Commission

The Company also owns a controlling interest in a health clinic in Puerto Rico, as part of our strategic initiatives.  The clinic is a member of the Mayo Clinic network.

Through our subsidiary TSS, we provide services to participants of the Commonwealth of Puerto Rico Health Insurance Plan (similar to Medicaid) (Medicaid).  In 2011, TSS entered into a contract with an agency of Commonwealth of Puerto Rico (the government of Puerto Rico or the Commonwealth), the Administración de Servicios de Salud de Puerto Rico (ASES), to administer the provision of the physical health component of this program in five service regions in Puerto Rico on an Administrative Service Only (ASO) basis, under which TSS receives a monthly per-member, per-month administrative fee for its services and does not bear the insurance risk of the program.  On July 1, 2013, TSS amended its contract extending the administration of the provision of the physical health component of the Medicaid program for a 12-month period expiring on June 30, 2014. This amendment also transferred the administration of three additional regions to TSS upon completion of a transition period, which ended on October 1, 2013.  On June 30, 2014, the contract was extended for a nine-month period expiring March 31, 2015.  Effective April 1, 2015, the government changed the Medicaid delivery model from an ASO to a risk based model.  Under the risk based delivery model, TSS provides healthcare services to only two service regions.

The Company also has two other wholly owned subsidiaries, Interactive Systems, Inc. (ISI), and TSM International, LLC (TSM International).  ISI is mainly engaged in providing data processing services to the Company and its subsidiaries.  TSM International is an International Banking Entity, as licensed by the government of Puerto Rico, and currently has limited operations.

A substantial majority of the Company’s business activity is within Puerto Rico, and as such, the Company is subject to the risks associated with the Puerto Rico economy.

9

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

2. Significant Accounting Policies

The following are the significant accounting policies followed by the Company and its subsidiaries:

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP).

The consolidated financial statements include the financial statements of the Company and its subsidiaries.  Intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period.  Actual results could differ from those estimates.

Cash Equivalents

The Company considers all highly liquid debt instruments with maturities of three months or less at the date of acquisition to be cash equivalents.  Cash equivalents of $24,486 and $113,040 at December 31, 2016 and 2015, respectively, consist principally of money market funds and certificates of deposit with original maturities of three months or less.

Investments

Investment in securities at December 31, 2016 and 2015 consists mainly of obligations of government‑sponsored enterprises, U.S. Treasury securities and obligations of U.S. government instrumentalities, obligations of the Commonwealth of Puerto Rico and its instrumentalities, municipal securities, corporate bonds, residential mortgage-backed securities, collateralized mortgage obligations, and equity securities.  The Company classifies its debt and equity securities in one of three categories: trading, available for sale, or held to maturity.  Trading securities are bought and held principally for the purpose of selling them in the near term.  Securities classified as held to maturity are those securities in which the Company has the ability and intent to hold the security until maturity.  All other securities not included in trading or held to maturity are classified as available for sale.

Trading and available-for-sale securities are recorded at fair value.  The fair values of debt securities (both available for sale and held to maturity investments) and equity securities are based on quoted market prices for those or similar investments at the reporting date.  Held-to-maturity debt securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums and discounts, respectively.  Unrealized holding gains and losses on trading securities are included in earnings.  Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized.  Realized gains and losses from the sale of available-for-sale securities are included in earnings and are determined on a specific‑identification basis.

Transfers of securities between categories are recorded at fair value at the date of transfer.  Unrealized holding gains and losses are recognized in earnings for transfers into trading securities.  Unrealized holding gains or losses associated with transfers of securities from held to maturity to available for sale are recorded as a separate component of other comprehensive income.  The unrealized holding gains or losses included in the separate component of other comprehensive income for securities transferred from available for sale to held to maturity, are maintained and amortized into earnings over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization or accretion of premium or discount on the associated security.

10

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

If a fixed maturity security is in an unrealized loss position and the Company has the intent to sell the fixed maturity security, or it is more likely than not that the Company will have to sell the fixed maturity security before recovery of its amortized cost basis, the decline in value is deemed to be other-than-temporary and is recorded to other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings.  For impaired fixed maturity securities that the Company does not intend to sell or it is more likely than not that such securities will not have to be sold, but the Company expects not to fully recover the amortized cost basis, the credit component of the other-than temporary impairment is recognized in other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings and the non-credit component of the other-than-temporary impairment is recognized in other comprehensive income.  Furthermore, unrealized losses entirely caused by non-credit related factors related to fixed maturity securities for which the Company expects to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive income.

The credit component of an other-than-temporary impairment is determined by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of acquisition.

The unrealized gains or losses on the Company’s equity securities classified as available-for-sale are included in accumulated other comprehensive income as a separate component of  stockholders’ equity, unless the decline in value is deemed to be other-than-temporary and the Company does not have the intent and ability to hold such equity securities until their full cost can be recovered, in which case such equity securities are written down to fair value and the loss is charged to other-than-temporary impairment losses recognized in earnings.

A decline in the fair value of any available-for-sale or held-to-maturity security below cost that is deemed to be other-than-temporary results in an impairment to reduce the carrying amount to fair value.  The impairment is charged to earnings and a new cost basis for the security is established.  To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary.  Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, market conditions, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in.

Premiums and discounts are amortized or accreted over the life of the related held-to-maturity or available-for-sale security as an adjustment to yield using the effective interest method.  Dividend and interest income are recognized when earned.

The Company regularly invests in mortgaged-backed securities and other securities subject to prepayment and call risk.  Significant changes in prevailing interest rates may adversely affect the timing and amount of cash flows on such securities.  In addition, the amortization of market premium and accretion of market discount for mortgaged-backed securities is based on historical experience and estimates of future payment speeds on the underlying mortgage loans.  Actual prepayment speeds may differ from original estimates and may result in material adjustments to amortization or accretion recorded in future periods.

11

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Revenue Recognition

a. Managed Care

Subscriber premiums on the managed care business are billed in advance of their respective coverage period and the related revenue is recorded as earned during the coverage period.  Managed care premiums are billed in the month prior to the effective date of the policy with a grace period of up to two months.  If the insured fails to pay, the policy can be cancelled at the end of the grace period at the option of the Company.  Premiums for the Medicaid business are based on a bid contract with ASES and billed in advance of coverage period.  Under the risk-based Medicaid contract, there is an excess profit agreement which stipulates that the profit of TSS for each fiscal year of the contract term shall not exceed two and a half percentage (2.5%) of the fixed amount paid by ASES for each member.  In the event that the profit exceeds this amount, TSS and ASES shall share the excess profit in proportions of fifty percent (50%), subject to the compliance by TSS with certain quality metrics.  ASES retains the right to determine the outcome of the excess profit agreement that is based on audited financial statements of the contracted services submitted annually by TSS and the validation of the Incurred-But-Not-Reported (“IBNR”) reserve by ASES’s actuary.  We estimate the effect of the following arrangements on a monthly basis and reflect the adjustments to premium revenue in current operations.  We report any estimated net amounts due to ASES within accounts payable and accrued liabilities in the consolidated balance sheets. As the contract year progresses and additional information becomes available, any excess profit will be recorded in the operating results of the period in which the information becomes available.

Premiums for the Medicare Advantage (MA) business are based on a bid contract with the Centers for Medicare and Medicaid Services (CMS) and billed in advance of the coverage period.  MA contracts provide for a risk factor to adjust premiums paid for members that represent a higher or lower risk to the Company.  Retroactive rate adjustments are made periodically based on the aggregate health status and risk scores of the Company’s MA membership.  These risk adjustments are evaluated quarterly, based on actuarial estimates.  Actual results could differ from these estimates.  We recognize periodic changes to risk-adjusted premiums as revenue when the amounts are determinable and collections is reasonably assured, which is possible as additional diagnosis code information is reported to CMS, when the ultimate adjustments settlements are received from CMS, or we receive notification of such settlement amounts. The data provided to CMS to determine members’ risk scores is subject to audit by CMS even after the annual settlement occur, which may result in the refund of premiums to CMS. As additional information becomes available, the recorded estimate is revised and reflected in operating results in the period in which it becomes available.

Prescription drug coverage is offered to Medicare eligible beneficiaries as part of MA plans (MA-PD) and until 2014, on a stand-alone basis (stand-alone PDP).  Premiums are based on a bid contract with CMS that considers the estimated costs of providing prescription drug benefits to enrolled participants.  MA-PD and stand-alone PDP premiums are subject to adjustment, positive or negative, based upon the application of risk corridors that compare the estimated prescription drug costs included in the bids to CMS to actual prescription drug costs.  Variances exceeding certain thresholds may result in CMS making additional payments or in CMS requesting a refund for a portion of the premiums collected.  The Company estimates and records adjustments to earned premiums related to estimated risk corridor payments based upon actual prescription drug costs for each reporting period as if the annual contract were to end at the end of each reporting period.

12

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Administrative service fees include revenue from certain groups which have managed care contracts that provide for the group to be at risk for all or a portion of their claims experience.  For these groups, the Company is not at risk and only handles the administration of managed care coverage for an administrative service fee.  The Company pays claims under commercial self-funded arrangements from its own funds, and subsequently receives reimbursement from these groups.  Until March 31, 2015, the claims related to the administration of the Medicaid business under the ASO delivery model were paid from a bank account owned and funded by the Government of Puerto Rico.  Claims paid under self-funded arrangements are excluded from the claims incurred in the accompanying consolidated financial statements.  Administrative service fees under the self-funded arrangements are recognized based on the group’s membership or incurred claims for the period multiplied by an administrative fee rate plus other fees.  In addition, some of these self-funded groups purchase aggregate and/or specific stop-loss coverage.  In exchange for a premium, the group’s aggregate liability or the group’s liability on any one episode of care is capped for the year.  Premiums for the stop-loss coverage are actuarially determined based on experience and other factors and are recorded as earned over the period of the contract in proportion to the coverage provided.  This fully insured portion of premiums is included within the premiums earned, net in the accompanying consolidated statements of earnings.  The Medicaid contract with the Government of Puerto Rico to administer the provision of the physical health component of this program contained a savings-sharing provision whereby the Government of Puerto Rico shared with TSS a portion of the medical cost savings obtained with the administration of the regions served on an administrative service basis.  Any savings-sharing amount was recorded when earned as administrative service fees in the accompanying consolidated statements of earnings.

b. Life and Accident and Health Insurance

Premiums on life insurance policies are billed in advance of their respective coverage period and the related revenue is recorded as earned when due.  Premiums on accident and health and other short‑term policies are recognized as earned primarily on a pro rata basis over the contract period.  Premiums on credit life policies are recognized as earned in proportion to the amounts of insurance in‑force.  Revenues from universal life and interest sensitive policies represent amounts assessed against policyholders, including mortality charges, surrender charges actually paid, and earned policy service fees.  The revenues for limited payment contracts are recognized over the period that benefits are provided rather than on collection of premiums.

c. Property and Casualty Insurance

Premiums on property and casualty contracts are billed in advance of their respective coverage period and they are recognized as earned on a pro rata basis over the policy term.  The portion of premiums related to the period prior to the end of coverage is recorded in the consolidated balance sheets as unearned premiums and is transferred to premium revenue as earned.

13

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Allowance for Doubtful Receivables

The allowance for doubtful receivables is based on management’s evaluation of the aging of accounts and such other factors which deserve current recognition, including the continued deterioration of the local economy, the exposure to government accounts, and the challenging business environment in the island.  This evaluation is performed individually on larger accounts and includes the use of all available information such as the customer’s credit worthiness and other relevant information.  Actual losses could differ from these estimates.  Receivables are charged-off against their respective allowance accounts when deemed to be uncollectible.

Deferred Policy Acquisition Costs and Value of Business Acquired

Certain direct costs for acquiring successful life and accident and health, and property and casualty insurance segment are deferred by the Company.  Substantially all acquisition costs related to the managed care segment are expensed as incurred.

In the life and accident and health segment deferred acquisition costs consist of commissions and certain expenses related to the production of life, annuity, accident and health, and credit business.  In the event that future premiums, in combination with policyholder reserves and anticipated investment income, could not provide for all future maintenance and settlement expenses, the amount of deferred policy acquisition costs would be reduced to provide for such amount.  The related amortization is provided over the anticipated premium-paying period of the related policies in proportion to the ratio of annual premium revenue to expected total premium revenue to be received over the life of the policies.  Interest is considered in the amortization of deferred policy acquisition cost and value of business acquired.  For these contracts interest is considered at a level rate at the time of issue of each contract, 5.15% for 2016, from 4.50% to 4.90% for 2015 and 4.90% for 2014, and, in the case of the value of business acquired, at the time of any acquisition.

For certain other long-duration contracts, deferred amounts are amortized at historical and forecasted credited interest rates.  Expected premium revenue is estimated by using the same mortality and withdrawal assumptions used in computing liabilities for future policy benefits.  The method followed in computing deferred policy acquisition costs limits the amount of such deferred costs to their estimated net realizable value.  In determining estimated net realizable value, the computations give effect to the premiums to be earned, related investment income, losses and loss-adjustment expenses, and certain other costs expected to be incurred as the premium is earned.

Costs deferred on universal life and interest sensitive products are amortized as a level percentage of the present value of anticipated gross profits from investment yields, mortality, expenses and surrender charges.  Estimates used are based on the Company’s experience as adjusted to provide for possible adverse deviations.  These estimates are periodically reviewed and compared with actual experience.  When it is determined that future expected experience differs significantly from that assumed, the estimates are updated for current and future issues which may result in a change or release of deferred policy acquisition costs amortization through the consolidated statement of earnings.

The value assigned to the life insurance in-force at the date of the acquisition is amortized using methods similar to those used to amortize the deferred policy acquisition costs of the life and accident and health segment.

In the property and casualty segment, acquisition costs consist of commissions incurred during the production of business and are deferred and amortized ratably over the terms of the policies.

14

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Property and Equipment

Property and equipment are stated at cost.  Maintenance and repairs are expensed as incurred.  Depreciation is calculated on the straight-line method over the estimated useful lives of the assets.  Costs of computer equipment, programs, systems, installations, and enhancements are capitalized and amortized straight-line over their estimated useful lives.  The following is a summary of the estimated useful lives of the Company’s property and equipment:

Asset Category	Estimated Useful Life
Buildings	20 to 50 years
Building improvements	3 to 5 years
Leasehold improvements	Shorter of estimated useful
Office furniture	life or lease term 5 years
Computer software	3 to 10 years
Computer equipment, equipment, and automobiles	3 years

Long-Lived Assets, including Goodwill

Long‑lived assets, such as property and equipment, and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset.  If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.  Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated.  The assets and liabilities of a disposal group classified as held for sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheets.

During 2014, the Company identified events that indicated that the carrying amount of the intangible assets purchased as part of the health clinic acquisition may not be recoverable.  As such, the Company performed an impairment analysis on those intangible assets and based on the results of the test, an impairment charge of $2,221 was recorded caused by the carrying value being greater than its fair value.  After the impairment charge, which is included within the consolidated operating expenses, there is no remaining carrying value of the acquired intangible assets as of December 31, 2014 related to the health clinic acquisition.  During 2016 and 2015, impairment tests on the remaining intangible assets were performed and based on the results of the tests no impairment was recorded.

Goodwill and intangible assets that have indefinite useful lives are tested at least annually for impairment, and are tested for impairment more frequently if events and circumstances indicate that the asset might be impaired.  An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value.  For goodwill, the impairment determination is made at the reporting unit level.  The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step goodwill impairment test.  The Company assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill.  If determined to be necessary, the two-step impairment test is used to identify potential goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any).   First, the Company determines the fair value of a reporting unit and compares it to its carrying amount.  Second, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill.  The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation.  The residual fair value after this allocation is the implied fair value of the reporting unit goodwill.

15

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The annual impairment test is based on an evaluation of estimated future discounted cash flows.  The estimated discounted cash flows are based on the best information available, including supportable assumptions and projections we believe are reasonable. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view. The discount rates are consistent with those used for investment decisions and take into account the operating plans and strategies of our operating segments. Certain other key assumptions utilized, including changes in membership, premium, health care costs, operating expenses, fees, assessments and taxes and effective tax rates, are based on estimates consistent with those utilized in our annual budgeting and planning process that we believe are reasonable. However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion of our goodwill, which would adversely affect our operating results in the period of impairment. Impairments, if any, would be classified as an operating expense.

Claim Liabilities

Claim liabilities for managed care policies represent the estimated amounts to be paid to providers based on experience and accumulated statistical data.  Loss-adjustment expenses related to such claims are currently accrued based on estimated future expenses necessary to process such claims. Managed care claim liabilities also include a provision for adverse deviation, which is an estimate for known environmental factors that are reasonably likely to affect the required level of reserves. This provision for adverse deviation is intended to capture the potential adverse development from known environmental factors such as our entry into new geographical markets, changes in our geographic or product mix, the introduction of new customer populations, variation in benefit utilization, disease outbreaks, changes in provider reimbursement, fluctuations in medical cost trend, variation in claim submission patterns and variation in claims processing speed and payment patterns, changes in technology that provide faster access to claims data or change the speed of adjudication and settlement of claims, variability in claim inventory levels, non-standard claim development, and/or exceptional situations that require judgmental adjustments in setting the reserves for claims.

The Company contracts with various independent practice associations (IPAs) for certain medical care services provided to some policies subscribers.  The IPAs are compensated on a capitation basis and capitation payables are included in claim liabilities.

Claim liabilities include unpaid claims and loss-adjustment expenses of the life and accident and health segment based on a case-basis estimate for reported claims, and on estimates, based on experience, for unreported claims and loss-adjustment expenses.  The liability for policy and contract claims and claims expenses has been established to cover the estimated net cost of insured claims.

Also included within the claim liabilities is the liability for losses and loss-adjustment expenses for the property and casualty segment which represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expenses for investigating and settling claims.

16

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Claim liabilities are necessarily based on estimates and, while management believes that the amounts are adequate, the ultimate liability may be in excess of or less than the amounts provided.  The methods for making such estimates and for establishing the resulting liability are continually reviewed, and any adjustments are reflected in the consolidated statements of earnings in the period determined.

Future Policy Benefits

The liability for future policy benefits has been computed using the level‑premium method based on estimated future investment yield, mortality, morbidity and withdrawal experience.  The assumptions are established at the time the policy is issued and are generally not changed during the life of the policy.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required. The interest rate assumption ranges between 3.90% and 5.75% for all years in issue.

Mortality has been calculated principally on select and ultimate tables in common usage in the industry.  Withdrawals have been estimated principally based on industry tables, modified by Company’s experience.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required.

Policyholder Deposits

Amounts received for annuity contracts are considered deposits and recorded as a liability along with the accrued interest and reduced for charges and withdrawals.  Interest incurred on such deposits, which amounted to $3,182, $3,379, and $3,510, during the years ended December 31, 2016, 2015, and 2014, respectively, is included within the interest expense in the accompanying consolidated statements of earnings.

Policyholder account balances for universal life and interest sensitive products are equal to policy account values. The policy account primarily comprises cumulative deposits received and interest credited to the policyholder less cumulative contract benefits, surrenders, withdrawals, maturities and contract charges for mortality or administrative expenses.  Interest rates credited to policyholder account balances during 2016 range from 1.25% to 4.5%, and during 2015 range from 2.0% to 4.5% for universal life and interest sensitive products.  The universal life and interest sensitive products represented $69,445 and $62,840 of the policyholder deposits balance on the consolidated balance sheets as of December 31, 2016 and 2015, respectively.

Reinsurance

In the normal course of business, the insurance-related subsidiaries seek to limit their exposure that may arise from catastrophes or other events that cause unfavorable underwriting results by reinsuring certain levels of risk in various areas of exposure with other insurance enterprises or reinsurers.

Reinsurance premiums, commissions, and expense reimbursements, related to reinsured business are accounted for on bases consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.  Accordingly, reinsurance premiums are reported as prepaid reinsurance premiums and amortized over the remaining contract period in proportion to the amount of insurance protection provided.

17

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Premiums ceded and recoveries of losses and loss-adjustment expenses have been reported as a reduction of premiums earned and losses and loss-adjustment expenses incurred, respectively.  Property and casualty commission and expense allowances received in connection with reinsurance ceded have been accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly.  Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured policy.

Income Taxes

Income taxes are accounted for under the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of earnings in the period that includes the enactment date.  The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.  Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized.  Changes in recognition or measurement are reflected in the period in which the change in circumstances occurs.

The Company records any interest and penalties related to unrecognized tax benefits within the operating expenses in the consolidated statement of earnings.

The holding company within the TSA group of companies is a U.S.-based company that has not recorded a U.S. deferred tax liability for the excess of the book basis over the tax basis of its investments in Puerto Rico corporations.  TSA has not recorded a deferred tax liability to the extent that the basis difference results from outside basis difference created as a result of the business combination and earnings that meet the indefinite reversal criteria. The indefinite reversal criteria is met if the Puerto Rico subsidiary has invested, or will invest, the undistributed earnings indefinitely. The decision as to the amount of undistributed earnings intended to be maintained in Puerto Rico corporations takes into account several items including, but not limited to, actual results of operations, forecasts and budgets of financial needs of cash for working capital, liquidity plans, capital improvement programs, merger and acquisition plans as well as expected cash requirements in the U.S. or in other Puerto Rico subsidiaries from the U.S.-based company.

Health Insurance Providers Fee

The Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (ACA) mandates an annual Health Insurance Providers Fee (HIP Fee).  The annual HIP Fee, which was effective January 1, 2014, becomes payable to the U.S. Treasury once the entity provides health insurance for any U.S. health risk each applicable calendar year.  The initial estimated annual fee is accrued as of January 1, with a corresponding deferred cost that is amortized over 12 months on a straight line basis. The fee payment is due on September 30 of each year. The Company incurred approximately $44,100, $34,500 and $27,700 of such fees in 2016, 2015 and 2014, respectively, which are presented within the consolidated operating expenses.

18

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Insurance-Related Assessments

The Company records a liability for insurance-related assessments when the following three conditions are met: (1) the assessment has been imposed or the information available prior to the issuance of the financial statements indicates it is probable that an assessment will be imposed; (2) the event obligating an entity to pay (underlying cause of) an imposed or probable assessment has occurred on or before the date of the financial statements; and (3) the amount of the assessment can be reasonably estimated.  A related asset is recognized when the paid or accrued assessment is recoverable through either premium taxes or policy surcharges.

Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated.  Legal costs incurred in connection with loss contingencies are expensed as incurred.  Recoveries of costs from third parties, which are probable of realization, are separately recorded as assets, and are not offset against the related liability.

Share‑Based Compensation

Share-based compensation is measured at the fair value of the award and recognized as an expense in the financial statements over the vesting period.

Earnings Per Share

Basic earnings per share excludes dilution and is computed by dividing net income available to all classes of common stockholders by the weighted average number of all classes of common shares outstanding for the period, excluding non-vested restricted stocks.  Diluted earnings per share is computed in the same manner as basic earnings per share except that the number of shares is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued.  Dilutive common shares are included in the diluted earnings per share calculation using the treasury stock method.

Recently Issued Accounting Standards

On January 5, 2016, the FASB issued guidance to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information.  Among the many targeted improvements to U.S. GAAP are (1) requiring equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income; (2) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; and (4) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.  This guidance applies to all entities that hold financial assets or owe financial liabilities. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

19

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

On February 25, 2016, the FASB issued guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and by disclosing key information about leasing arrangements.  This guidance sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessors and lessees. It requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The guidance requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. Companies are required to adopt the new guidance using a modified retrospective approach for annual and interim periods beginning after December 31, 2018.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

On March 30, 2016, the FASB issued guidance to reduce complexity in accounting standards.  The areas for simplification involve several aspects of the accounting for share-based payment transactions, including (1) accounting for income taxes, (2) classification of excess tax benefits on the statement of cash flow, (3) forfeitures; (4) minimum statutory tax withholding requirements, (5) classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax withholding purposes:, (6) the practical expedient for estimating the expected term, and (7) intrinsic value.  The guidance related to when excess tax benefits are recognized will be adopted through a modified retrospective approach by means of a cumulative-effect adjustment to equity as of January 1, 2017.  The provisions related to the recognition of excess tax benefits in the income statements and classification in the statement of cash flows will be adopted prospectively.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On May 9, 2016, the FASB issued guidance which affects only the narrow aspects of guidance related to revenue from contracts with customers that include: (1) clarification of the collectibility criterion and the addition of a new criterion to clarify when revenue would be recognized for a contract that fails to meet the criteria in step 1 of the core principle of the guidance (i.e., identifying the contracts with a customer); (2) presentation of sales taxes and similar taxes collected from customers; (3) non-cash consideration; (4) contract modifications at transition; (5) completed contracts at transition; and (6) clarification that an entity that retrospectively applies in the guidance to each prior reporting period is not required to disclose the effect of the accounting change for the period of adoption, but is still required to disclose the effect of the changes on any prior periods retrospectively adjusted. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  As the majority of the Company’s revenues are not subject to the new guidance, the adoption of this guidance should not have a material impact on the Company’s consolidated financial position, result of operations, equity or cash flows. We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On June 16, 2016, the FASB issued guidance to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date by replacing the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

20

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

On August 26, 2016, the FASB issued guidance to addresses stakeholders’ concerns regarding diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under, Statement of Cash Flows, and other Topics.  In particular, the guidance addresses eight specific cash flow issues in an effort to reduce this diversity in practice: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On December 14, 2016, the FASB issued guidance that amended the Master Glossary of the Accounting Standards Codification (ASC), including simplification and minor improvements to Codification topics and subtopics regarding insurance and troubled debt restructuring that result in numerous editorial changes to the Codification, but are not expected to affect current accounting practice or result in any significant costs.  However, there are six amendments that clarify guidance or correct references in the Codification, and could potentially result in changes in current practice because of either misapplication or misunderstanding of current guidance, including amendments to (1) Property, Plant, and Equipment—Real Estate Sales; (2) Fair Value Measurement; (3) Transfers and Servicing —Sales of Financial Assets; (4) Liabilities—Obligations Resulting from Joint and Several Liability Arrangements; (5) Transfers and Servicing—Servicing Assets and Liabilities; and (6) Intangibles—Goodwill and Other— Internal-Use Software.  The transition guidance for the first five amendments must be applied prospectively because they could potentially involve the use of hindsight that includes fair value measurements.  Other than as indicated above, the amendments in this guidance are effective upon issuance for both public entities and nonpublic entities.  The Company adopted this guidance upon issuance with no impact on our financial position and results of operations.

Other than the accounting pronouncements disclosed above, there were no other new accounting pronouncements issued that could have a material impact in the Company’s financial position, operating results or financials statement disclosures.

21

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

3. Investment in Securities

The amortized cost for debt securities and cost for equity securities, gross unrealized gains, gross unrealized losses, and estimated fair value for available-for-sale and held-to-maturity securities by major security type and class of security at December 31, 2016 and 2015, were as follows:

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	41,442	$	87	$	(15	)	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,652		157		(9	)		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		17,930		2,189		(68	)		20,051
Municipal securities		650,175		34,187		(559	)		683,803
Corporate bonds		263,351		12,182		(661	)		274,872
Residential mortgage-backed securities		684		34		-			718
Collateralized mortgage obligations		45,069		58		(242	)		44,885
Total fixed maturities		1,104,303		48,894		(1,554	)		1,151,643
Equity securities-Mutual funds		240,699		30,101		(451	)		270,349
Total	$	1,345,002	$	78,995	$	(2,005	)	$	1,421,992

22

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	115,965	$	301	$	(26	)	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,322		234		(286	)		163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		25,302		317		-			25,619
Municipal securities		612,225		35,418		(197	)		647,446
Corporate bonds		148,198		9,782		(572	)		157,408
Residential mortgage-backed securities		883		54		-			937
Collateralized mortgage obligations		22,363		368		(6	)		22,725
Total fixed maturities		1,088,258		46,474		(1,087	)		1,133,645
Equity securities-Mutual funds		169,593		27,851		(373	)		197,071
Total	$	1,257,851	$	74,325	$	(1,460	)	$	1,330,716

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	619	$	158	$	-	$	777
Residential mortgage-backed securities		191		18		-		209
Certificates of deposits		2,026		-		-		2,026
	$	2,836	$	176	$	-	$	3,012

23

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	620	$	178	$	-	$	798
Residential mortgage-backed securities		191		17		-		208
Certificates of deposits		2,118		-		-		2,118
	$	2,929	$	195	$	-	$	3,124

Gross unrealized losses on investment securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2016 and 2015 were as follows:

	2016
	Less than 12 months							12 months or longer							Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	9,483	$	(15	)		1	$	-	$	-			-	$	9,483	$	(15	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		12,937		(9	)		1		-		-			-		12,937		(9	)		1
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		7,758		(68	)		5		-		-			-		7,758		(68	)		5
Municipal securities		84,252		(559	)		13		-		-			-		84,252		(559	)		13
Corporate bonds		105,054		(661	)		22		-		-			-		105,054		(661	)		22
Collateralized mortgage obligations		32,120		(239	)		8		784		(3	)		1		32,904		(242	)		9
Total fixed maturities		251,604		(1,551	)		50		784		(3	)		1		252,388		(1,554	)		51
Equity securities-Mutual funds		22,615		(451	)		4		-		-			-		22,615		(451	)		4
Total for securities available for sale	$	274,219	$	(2,002	)		54	$	784	$	(3	)		1	$	275,003	$	(2,005	)		55

24

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2015
	Less than 12 months							12 months or longer						Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss		Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	18,989	$	(26	)		1	$	-	$	-		-	$	18,989	$	(26	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		130,996		(286	)		5		-		-		-		130,996		(286	)		5
Municipal securities		43,937		(197	)		11		-		-		-		43,937		(197	)		11
Corporate bonds		35,718		(572	)		9		-		-		-		35,718		(572	)		9
Collateralized mortgage obligations		1,448		(6	)		1		-		-		-		1,448		(6	)		1
Total fixed maturities		231,088		(1,087	)		27		-		-		-		231,088		(1,087	)		27
Equity securities-Mutual funds		9,319		(373	)		2		-		-		-		9,319		(373	)		2
Total for securities available for sale	$	240,407	$	(1,460	)		29	$	-	$	-		-	$	240,407	$	(1,460	)		29

The Corporation regularly monitors and evaluates the difference between the amortized cost and estimated fair value of investments.  For investments with a fair value below amortized cost, the process includes evaluating: (1) the length of time and the extent to which the estimated fair value has been less than amortized cost for fixed maturity securities, or cost for equity securities, (2) the financial condition, near-term and long-term prospects for the issuer, including relevant industry conditions and trends, and implications of rating agency actions, (3) the Company’s intent to sell or the likelihood of a required sale prior to recovery, (4) the recoverability of principal and interest for fixed maturity securities, or cost for equity securities, and (5) other factors, as applicable.  This process is not exact and requires further consideration of risks such as credit and interest rate risks.  Consequently, if an investment’s cost exceeds its estimated fair value solely due to changes in interest rates, other-than temporary impairment may not be appropriate.

Due to the subjective nature of the Corporation’s analysis, along with the judgment that must be applied in the analysis, it is possible that the Corporation could reach a different conclusion whether or not to impair a security if it had access to additional information about the investee.  Additionally, it is possible that the investee’s ability to meet future contractual obligations may be different than what the Corporation determined during its analysis, which may lead to a different impairment conclusion in future periods.

If after monitoring and analyzing impaired securities, the Corporation determines that a decline in the estimated fair value of any available-for-sale or held-to-maturity security below cost is other-than-temporary, the carrying amount of the security is reduced to its fair value in accordance with current accounting guidance.  The new cost basis of an impaired security is not adjusted for subsequent increases in estimated fair value.  In periods subsequent to the recognition of an other-than-temporary impairment, the impaired security is accounted for as if it had been purchased on the measurement date of the impairment.  For debt securities, the discount (or reduced premium) based on the new cost basis may be accreted into net investment income in future periods based on prospective changes in cash flow estimates, to reflect adjustments to the effective yield.

25

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The Corporation’s process for identifying and reviewing invested assets for other-than temporary impairments during any quarter includes the following:

• Identification and evaluation of securities that have possible indications of other-than-temporary impairment, which includes an analysis of all investments with gross unrealized investment losses that represent 20% or more of their cost and all investments with an unrealized loss greater than $100.

• For any other securities with a gross unrealized investment loss we might review and evaluate investee’s current financial condition, liquidity, near-term recovery prospects, implications of rating agency actions, the outlook for the business sectors in which the investee operates and other factors.

• Consideration of evidential matter, including an evaluation of factors or triggers that may or may not cause individual investments to qualify as having other-than-temporary impairments.

• Determination of the status of each analyzed security as other-than-temporary or not, with documentation of the rationale for the decision; and

• Equity securities are considered to be impaired based on market conditions and the length of time the funds have been in a loss position.

The Corporation reviews the investment portfolios under the Corporation’s impairment review policy.  Given market conditions and the significant judgments involved, there is a continuing risk that declines in fair value may occur and material other-than-temporary impairments may be recorded in future periods.  The Corporation from time to time may sell investments as part of its asset/liability management process or to reposition its investment portfolio based on current and expected market conditions.

Obligations of Government-Sponsored Enterprises, Obligations of U.S. Government Instrumentalities and Municipal Securities:  The unrealized losses on the Corporation’s investments in obligations of Government Sponsored Enterprises, U.S. Government Instrumentalities, and Municipal Securities were mainly caused by fluctuations in interest rates and general market conditions.  The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the par value of the investment.  In addition, these investments have investment grade ratings. Because the decline in fair value is attributable to changes in interest rates and not credit quality; because the Corporation does not intend to sell the investments and it is not more likely than not that the Corporation will be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Corporation expects to collect all contractual cash flows, these investments are not considered other-than-temporarily impaired.

Corporate Bonds:  The unrealized losses of these bonds were principally caused by fluctuations in interest rates and general market conditions.  All corporate bonds with an unrealized loss have investment grade ratings.  Because the decline in estimated fair value is principally attributable to changes in interest rates; because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Company expects to collect all contractual cash flows, these investments are not considered other-than-temporarily impaired.

Collateralized mortgage obligations:  The unrealized losses on investments in collateralized mortgage obligations (“CMOs”) were mostly caused by fluctuations in interest rates and credit spreads.  The contractual cash flows of these securities, other than private CMOs, are guaranteed by a U.S. government-sponsored enterprise.  Any loss in these securities is determined according to the seniority level of each tranche, with the least senior (or most junior), typically the unrated residual tranche, taking any initial loss. The investment grade credit rating of our securities reflects the seniority of the securities that the Corporation owns.  The Corporation does not consider these investments other-than-temporarily impaired because the decline in fair value is attributable to changes in interest rates and not credit quality; the Corporation does not intend to sell the investments and it is more likely than not that the Corporation will not be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Corporation expects to collect all contractual cash flows.

26

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Mutual Funds:As of December 31, 2016, investments in mutual funds with unrealized losses are not considered other-than-temporarily impaired based on market conditions and the length of time the funds have been in a loss position.  During the years ended December 31, 2016 and 2015, positions with a total fair market value of $11,582 and $13,189 were impaired by $1,434 and $945, respectively.  There were no impairment on mutual funds during the year 2014.

Obligations of the Commonwealth of Puerto Rico and its Instrumentalities: Our holdings in Puerto Rico municipals can be divided in (1) escrowed bonds with a fair value of $7,758 and a gross unrealized loss of $68, and (2) bonds issued by the Puerto Rico Sales Tax Financing Corporation (Cofina) with a fair value of $12,293 and a gross unrealized gain of $2,189.

As of December 31, 2016, investments in escrowed bonds are not considered other-than-temporarily impaired based on the length of time the funds have been in a loss position, the decline in estimated fair value is principally attributable to changes in interest rates, and the fact that these bonds are backed by US Government securities, and therefore have an implicit AA+/Aaa rating.

Besides holdings in escrowed bonds, our exposure is in senior liens bonds issued by Cofina, which were not impaired during the year ended December 31, 2016.  During the years ended December 31, 2015 and 2014, impairments on Cofina bonds amounted to $4,267 and $1,170, respectively.

Maturities of investment securities classified as available for sale and held to maturity at December 31, 2016 were as follows:

	Amortized Cost		Estimated Fair Value
Securities available for sale
Due in one year or less	$	11,010	$	11,116
Due after one year through five years		343,904		347,140
Due after five years through ten years		144,748		152,225
Due after ten years		558,888		595,559
Residential mortgage-backed securities		684		718
Collateralized mortgage obligations		45,069		44,885
	$	1,104,303	$	1,151,643
Securities held to maturity
Due in one year or less	$	2,026	$	2,026
Due after ten years		619		777
Residential mortgage-backed securities		191		209
	$	2,836	$	3,012

Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay obligations with or without call or prepayment penalties.

27

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Investments with an amortized cost of $5,358 and $5,136 (fair value of $5,788 and $5,276) at December 31, 2016 and 2015, respectively, were deposited with the Commissioner of Insurance to comply with the deposit requirements of the Insurance Code of the Commonwealth of Puerto Rico (the Insurance Code).

Information regarding realized and unrealized gains and losses from investments for the years ended December 31, 2016, 2015, and 2014 is as follows:

	2016			2015			2014
Realized gains (losses)
Fixed maturity securities
Securities available for sale
Gross gains from sales	$	3,086		$	8,208		$	5,118
Gross losses from sales		(2,744	)		(646	)		(5,884	)
Gross losses from other-than-temporary impairments		-			(4,267	)		(1,170	)
Total fixed maturity securities		342			3,295			(1,936	)
Equity securities
Securities available for sale
Gross gains from sales		19,674			17,903			20,848
Gross losses from sales		(1,203	)		(1,312	)		(2,106	)
Gross losses from other-than-temporary impairments		(1,434	)		(945	)		-
Total equity securities		17,037			15,646			18,742
Net realized gains on securities available for sale		17,379			18,941			16,806
Gross gain from other investment		-			-			1,425
Net realized gains on securities	$	17,379		$	18,941		$	18,231

The other-than-temporary impairments on fixed maturity securities are attributable to credit losses.

	2016			2015			2014
Changes in unrealized gains (losses)
Recognized in accumulated other comprehensive income (loss)
Fixed maturities – available for sale		1,953			(25,227	)		46,220
Equity securities – available for sale		2,172			(19,479	)		(5,620	)
	$	4,125		$	(44,706	)	$	40,600
Not recognized in the consolidated financial statements
Fixed maturities – held to maturity	$	(19	)	$	(24	)	$	49

28

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The deferred tax asset (liability) on unrealized gains (losses) change recognized in accumulated other comprehensive income during the years 2016, 2015, and 2014 was $(1,085), $5,717, and $(4,717), respectively.

As of December 31, 2016 and 2015 no individual investment in securities exceeded 10% of stockholders’ equity.

4. Net Investment Income

Interest and/or dividend income from:

	Years ended December 31
	2016		2015		2014
Fixed maturities	$	37,139	$	36,256	$	38,559
Equity securities		9,666		7,146		7,660
Policy loans		619		557		545
Cash equivalents and interest-bearing deposits		257		143		117
Other		1,232		1,072		659
Total	$	48,913	$	45,174	$	47,540

5. Premium and Other Receivables, Net

Premium and other receivables, net as of December 31 were as follows:

	2016		2015
Premium	$	91,528	$	92,600
Self-funded group receivables		57,728		73,552
FEHBP		14,321		13,859
Agent balances		25,495		25,424
Accrued interest		13,668		12,624
Reinsurance recoverable		58,295		48,506
Other		62,637		53,325
		323,672		319,890
Less allowance for doubtful receivables:
Premium		27,320		28,944
Other		9,987		8,300
		37,307		37,244
Premium and other receivables, net	$	286,365	$	282,646

As of December 31, 2016 and 2015, the Company had premiums and other receivables of $57,750 and $78,230, respectively, from the Government of Puerto Rico, including its agencies, municipalities and public corporations. The related allowance for doubtful receivables as of December 31, 2016 and 2015 were $18,812 and $19,133, respectively.

29

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

6. Deferred Policy Acquisition Costs and Value of Business Acquired

The movement of deferred policy acquisition costs (DPAC) and value of business acquired (VOBA) for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	DPAC			VOBA			Total
Balance, December 31, 2013	$	140,928		$	36,361		$	177,289
Additions		48,723			-			48,723
VOBA interest at an average rate of 5.17%		-			1,726			1,726
Amortization		(37,895	)		(5,743	)		(43,638	)
Net change		10,828			(4,017	)		6,811
Balance, December 31, 2014		151,756			32,344			184,100
Additions		48,599			-			48,599
VOBA interest at an average rate of 5.15%		-			1,543			1,543
Amortization		(38,624	)		(4,970	)		(43,594	)
Net change		9,975			(3,427	)		6,548
Balance, December 31, 2015		161,731			28,917			190,648
Additions		47,742			-			47,742
VOBA interest at an average rate of 5.15%		-			1,381			1,381
Amortization		(40,848	)		(4,136	)		(44,984	)
Net change		6,894			(2,755	)		4,139
Balance, December 31, 2016	$	168,625		$	26,162		$	194,787

A portion of the amortization of the DPAC and VOBA is recorded as an amortization expense and included within the operating expenses in the accompanying consolidated statement of earnings.  The remaining portion of the DPAC and VOBA amortization includes the unrealized investment gains and losses that would have been amortized if such gains and losses had been realized, which for the year ended December 31, 2016 amounted to $3,147 and is included within the unrealized gains on securities component of other comprehensive income.

The estimated amount of the year-end VOBA balance expected to be amortized during the next five years is as follows:

Year ending December 31:
2017	$	3,582
2018		2,597
2019		2,279
2020		2,009
2021		2,075

30

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

7. Property and Equipment, Net

Property and equipment, net as of December 31 are composed of the following:

	2016		2015
Land	$	10,976	$	10,976
Buildings and leasehold improvements		64,828		63,967
Office furniture and equipment		24,234		22,869
Computer equipment and software		114,749		113,223
Automobiles		593		494
		215,380		211,529
Less accumulated depreciation and amortization		149,011		137,576
Property and equipment, net	$	66,369	$	73,953

8. Goodwill

Certain business combination transactions have resulted in goodwill, which represents the excess of the acquisition cost over the fair value of net assets acquired, and is assigned to reporting units.  Goodwill recorded as of December 31, 2016 and 2015 was $25,397 which is mostly attributable to the Medicare Advantage reporting unit within the Managed Care segment.

As required by accounting guidance, the 2016 and 2015 annual goodwill impairment tests were performed and based on the results of the tests, no impairment charge was required.  If the Company does not achieve its earnings objectives or the cost of capital raises significantly, the assumptions and estimates underlying these impairment tests could be adversely affected and result in future impairment charges that would negatively impact its operating results.  Cumulative goodwill impairment charges were $2,369 as of December 31, 2016 and 2015.  All cumulative goodwill impairment is related to the health clinic reporting unit.

31

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

9. Fair Value Measurements

Assets recorded at fair value in the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.  Level inputs, as defined by current accounting guidance for fair value measurements and disclosures, are as follows:

Level Input Definition:

Level 1 Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.

Level 2 Inputs other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with market data at the measurement date.

Level 3 Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.

The Corporation uses observable inputs when available. Fair value is based upon quoted market prices when available. The Corporation limits valuation adjustments to those deemed necessary to ensure that the security’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria.  The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results.  The fair value measurement levels are not indicative of risk of investment.

The fair value of investment securities is estimated based on quoted market prices for those or similar investments.  Additional information pertinent to the estimated fair value of investment in securities is included in note 3.

32

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	41,514	$	-	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,800		-		-		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		-		20,051		-		20,051
Municipal securities		-		683,803		-		683,803
Corporate Bonds		-		274,872		-		274,872
Residential agency mortgage-backed securities		-		718		-		718
Collaterized mortgage obligations		-		44,885		-		44,885
Total fixed maturities		85,800		1,065,843		-		1,151,643
Equity securities - Mutual funds		166,595		76,222		27,532		270,349
	$	252,395	$	1,142,065	$	27,532	$	1,421,992

	2015
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	116,240	$	-	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,270		-		-		163,270
Obligations of the Commonwealth of
Puerto Rico and its instrumentalities		-		25,619		-		25,619
Municipal securities		-		647,446		-		647,446
Corporate Bonds		-		157,408		-		157,408
Residential agency mortgage-backed securities		-		937		-		937
Collaterized mortgage obligations		-		22,725		-		22,725
Total fixed maturities		163,270		970,375		-		1,133,645
Equity securities - Mutual funds		167,082		22,031		7,958		197,071
	$	330,352	$	992,406	$	7,958	$	1,330,716

33

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The fair value of fixed maturity and equity securities included in the Level 2 category were based on market values obtained from independent pricing services, which utilize evaluated pricing models that vary by asset class and incorporate available trade, bid and other market information and for structured securities, cash flow and when available loan performance data.  Because many fixed income securities do not trade on a daily basis, the models used by independent pricing service providers to prepare evaluations apply available information, such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing.  For certain equity securities, quoted market prices for the identical security are not always available and the fair value is estimated by reference to similar securities for which quoted prices are available.  The independent pricing service providers monitor market indicators, industry and economic events, and for broker-quoted only securities, obtain quotes from market makers or broker-dealers that they recognize to be market participants. The fair value of the investments in partnerships included in the Level 3 category was based on the net asset value (NAV) which is affected by the changes in the fair market value of the investments held in these partnerships.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company’s best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement.  Transfers between levels, if any, are recorded as of the actual date of the event or change in circumstance that caused the transfer.  There were no transfers between Levels 1 and 2 during the years ended December 31, 2016 and 2015.

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31 is as follows:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	2016			2015			2014
Balance as of January 1,	$	7,958		$	13,349		$	17,910
Realized gains		324			1,538			2,552
Unrealized in other accumulated comprehensive income		(1,458	)		(4,207	)		(2,937	)
Purchases		23,991			1,207			501
Sales		-			-			-
Capital Distributions		(3,283	)		(3,929	)		(4,677	)
Balance as of December 31,	$	27,532		$	7,958		$	13,349

In addition to the preceding disclosures on assets recorded at fair value in the consolidated balance sheets, accounting guidance also requires the disclosure of fair values for certain other financial instruments for which it is practicable to estimate fair value, whether or not such values are recognized in the consolidated balance sheets.

Non-financial instruments such as property and equipment, other assets, deferred income taxes and intangible assets, and certain financial instruments such as claim liabilities are excluded from the fair value disclosures. Therefore, the fair value amounts cannot be aggregated to determine our underlying economic value.

34

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, receivables, accounts payable and accrued liabilities, and short-term borrowings approximate fair value because of the short term nature of these items.  These assets and liabilities are not listed in the table below.

The following methods, assumptions and inputs were used to estimate the fair value of each class of financial instrument:

(i)  Policy Loans

Policy loans have no stated maturity dates and are part of the related insurance contract. The carrying amount of policy loans approximates fair value because their interest rate is reset periodically in accordance with current market rates.

(ii)  Policyholder Deposits

The fair value of policyholder deposits is the amount payable on demand at the reporting date, and accordingly, the carrying value amount approximates fair value.

(iii)  Long-term Borrowings

The carrying amount of the loans payable to bank – variable approximates fair value due to its floating interest-rate structure.  The fair value of the loans payable to bank – fixed and senior unsecured notes payable was determined using broker quotations.

35

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

A summary of the carrying value and fair value by level of financial instruments not recorded at fair value on our consolidated balance sheets at December 31, 2016 and 2015 are as follows:

	2016
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	8,564	$	-	$	8,564	$	-	$	8,564
Liabilities:
Policyholder deposits	$	179,382	$	-	$	179,382	$	-	$	179,382
Long-term borrowings:
Loans payable to bank - variable		11,187		-		11,187		-		11,187
6.6% senior unsecured notes payable		24,000		-		24,000		-		24,000
Total long-term borrowings		35,187		-		35,187		-		35,187
Total liabilities	$	214,569	$	-	$	214,569	$	-	$	214,569

	2015
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	7,901	$	-	$	7,901	$	-	$	7,901
Liabilities:
Policyholder deposits	$	179,287	$	-	$	179,287	$	-	$	179,287
Long-term borrowings:
Loans payable to bank - variable		12,827		-		12,827		-		12,827
6.6% senior unsecured notes payable		24,000		-		19,920		-		19,920
Total long-term borrowings		36,827		-		32,747		-		32,747
Total liabilities	$	216,114	$	-	$	212,034	$	-	$	212,034

36

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

10. Claim Liabilities and Claim Adjustment Expenses

A reconciliation of the beginning and ending balances of claim liabilities in 2016, 2015 and 2014 is as follows:

	2016
	Managed Care			Other  Business Segments *			Consolidated
Claim liabilities at beginning of year	$	348,297		$	143,468		$	491,765
Reinsurance recoverable on claim liabilities		-			(40,714	)		(40,714	)
Net claim liabilities at beginning of year		348,297			102,754			451,051
Claims incurred
Current period insured events		2,356,594			103,049			2,459,643
Prior period insured events		(9,047	)		(7,157	)		(16,204	)
Total		2,347,547			95,892			2,443,439
Payments of losses and loss-adjustment
expenses
Current period insured events		2,083,552			58,091			2,141,643
Prior period insured events		263,245			40,657			303,902
Total		2,346,797			98,748			2,445,545
Net claim liabilities at end of year		349,047			99,898			448,945
Reinsurance recoverable on claim liabilities		-			38,998			38,998
Claim liabilities at end of year	$	349,047		$	138,896		$	487,943

	2015
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	249,330		$	140,756		$	390,086
Reinsurance recoverable on claim liabilities		-			(40,635	)		(40,635	)
Net claim liabilities at beginning of year		249,330			100,121			349,451
Claims incurred
Current period insured events		2,216,330			98,279			2,314,609
Prior period insured events		(19,637	)		(1,211	)		(20,848	)
Total		2,196,693			97,068			2,293,761
Payments of losses and loss-adjustment
expenses
Current period insured events		1,868,607			52,369			1,920,976
Prior period insured events		229,119			42,066			271,185
Total		2,097,726			94,435			2,192,161
Net claim liabilities at end of year		348,297			102,754			451,051
Reinsurance recoverable on claim liabilities		-			40,714			40,714
Claim liabilities at end of year	$	348,297		$	143,468		$	491,765

	2014
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	283,615		$	136,806		$	420,421
Reinsurance recoverable on claim liabilities		-			(37,557	)		(37,557	)
Net claim liabilities at beginning of year		283,615			99,249			382,864
Claims incurred
Current period insured events		1,665,255			95,944			1,761,199
Prior period insured events		(36,160	)		(1,251	)		(37,411	)
Total		1,629,095			94,693			1,723,788
Payments of losses and loss-adjustment
expenses
Current period insured events		1,449,224			50,422			1,499,646
Prior period insured events		214,156			43,399			257,555
Total		1,663,380			93,821			1,757,201
Net claim liabilities at end of year		249,330			100,121			349,451
Reinsurance recoverable on claim liabilities		-			40,635			40,635
Claim liabilities at end of year	$	249,330		$	140,756		$	390,086

* Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations.

37

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

As a result of differences between actual amounts and estimates of insured events in prior years, the amounts included as claims incurred for prior period insured events differ from anticipated claims incurred.

The favorable developments in the claims incurred and loss-adjustment expenses for prior period insured events for 2016, 2015 and 2014 are due primarily to better than expected utilization trends mostly in the Managed Care segment.  Reinsurance recoverable on unpaid claims is reported as premium and other receivables, net in the accompanying consolidated financial statements.

The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,807 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

The following is information about incurred and paid claims development, net of reinsurance, as of December 31, 2016, as well as cumulative claim frequency.  Additional information presented includes total incurred- but- not- reported liabilities plus expected development on reported claims is included within the net incurred claims amounts.

The information about incurred and paid claims development for the year ended December 31, 2015 and previous years are presented as supplementary information and unaudited where indicated.

Managed Care

The Company estimates its liabilities for unpaid claims following a detailed actuarial process that entails using both historical claim payment patterns as well as emerging medical cost trends to project a best estimate of claim liabilities. This process includes comparing the historical claims incurred dates to the actual dates on claims payment.  Completion factors are applied to claims paid through the financial statements date to estimate the claim expense incurred for the current period.  The liability for claim adjustment expenses consists of adjustments made by our actuaries based on their knowledge and their estimate of emerging impacts to benefit costs and payment speed.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance					As of December 31, 2016
	Incurred amount						(in thousands)
Incurred Year	(unaudited) 2015			2016	Total of IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
2015	$	2,216,330		2,207,283		75,431		17,830
2016				2,356,592		273,040		16,633
	Total		$	4,563,875

Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year	(unaudited) 2015			2016
2015	$	1,868,607		2,131,852
2016				2,083,552
	Total		$	4,215,404
All outstanding liabilities before 2015, net of reinsurance				576
Liabilities for claims and claim adjustment expenses, net of reinsurance			$	349,047

38

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Property and Casualty

Claims liability for property and casualty represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expense for investigating and setting claims.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																					As of December 31, 2016
Incurred Year	Incurred amount																				Total of IBNR Plus Expected Development on Reported Claims		Cumulative Number of reported claims
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
2007	$	51,531	$	49,555	$	47,673	$	45,836	$	45,380	$	45,654	$	45,534	$	45,534	$	45,515	$	45,604	$	27		15,762
2008				49,095		48,812		46,443		45,941		45,541		47,658		45,909		45,535		45,571		142		16,089
2009						51,778		51,760		50,848		51,298		51,564		51,315		51,485		51,293		177		18,013
2010								54,226		54,090		55,266		56,400		57,115		57,386		57,242		482		20,918
2011										51,315		50,287		51,105		50,776		51,895		52,099		656		20,222
2012												49,040		49,856		48,900		49,817		48,945		1,565		22,366
2013														52,343		51,030		49,606		49,168		2,274		22,045
2014																48,430		45,410		43,707		3,377		20,085
2015																		45,067		40,175		6,160		18,912
2016																				48,127		16,806		19,897
																	Total		$	481,931

Cumulative Paid claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year
	(unaudited) 2007		(unaudited) 2008		(unaudited) 2009		(unaudited) 2010		(unaudited) 2011		(unaudited) 2012		(unaudited) 2013		(unaudited) 2014		(unaudited) 2015		2016
2007	$	20,912	$	31,298	$	36,287	$	39,477	$	41,918	$	43,203	$	44,007	$	44,470	$	44,835	$	45,133
2008				23,715		32,834		37,420		40,332		41,847		43,787		44,426		44,703		44,867
2009						23,843		35,327		41,810		45,838		48,637		49,709		50,196		50,371
2010								27,118		38,964		45,409		49,808		52,890		54,027		54,996
2011										24,534		34,835		41,606		44,996		47,908		49,598
2012												22,677		33,620		40,406		43,663		45,607
2013														21,376		33,249		38,979		42,840
2014																18,752		28,657		33,809
2015																		17,063		24,935
2016																				20,099
																			$	412,255
										All Outstanding liabilities before 2007, net of reinsurance										1,415
										Liabilities for claims and claims adjustment expenses, net of reinsurance									$	71,091

At December 31, 2016 the amounts of unpaid claims and claim adjustment expenses in the accompanying financial statements are $481,931 and $412,255, respectively.

The following table includes the annual percentage payout of incurred claims by age, net of reinsurance, for property and casualty segment as supplementary information as of December 31, 2016:

	(unaudited) 2007			(unaudited) 2008			(unaudited) 2009			(unaudited) 2010			(unaudited) 2011			(unaudited) 2012			(unaudited) 2013			(unaudited) 2014			(unaudited) 2015			(unaudited) 2016
Average		45.6	%		21.6	%		11.9	%		7.1	%		4.8	%		2.9	%		1.5	%		0.7	%		0.6	%		0.7	%

39

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The reconciliation of the net incurred and paid claims development tables, by segment, to the liability for claims and claim adjustment expenses in the consolidated balance sheets is as follows:

	As of December 31, 2016
Net outstanding liabilities
Managed Care	$	349,047
Property and Casualty		71,091
Other short-duration insurance lines		102
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		420,240
Reinsurance recoverable on unpaid claims - Property and Casualty		25,885
Insurance lines other than short-duration		42,757
Intersegment Elimination		(939	)
Total gross liability for unpaid claims and claim adjustment expense	$	487,943

11. Federal Employees’ Health Benefits (FEHBP) and Federal Employees’ (FEP) Programs

FEHBP

In prior years, TSS entered into a contract, renewable annually, with the Office of Personnel Management (OPM) as authorized by the Federal Employees’ Health Benefits Act of 1959, as amended, to provide health benefits under the FEHBP.  The FEHBP covers postal and federal employees residing in the Commonwealth of Puerto Rico and the United States Virgin Islands as well as retirees and eligible dependents.  The FEHBP is financed through a negotiated contribution made by the federal government and employees’ payroll deductions.

The accounting policies for the FEHBP are the same as those described in the Company’s summary of significant accounting policies.  Premium rates are determined annually by TSS and approved by the federal government.  Claims are paid to providers based on the guidelines determined by the federal government.  Operating expenses are allocated from TSS’s operations to the FEHBP based on applicable allocation guidelines (such as, the number of claims processed for each program) and are subject to contractual expense limitations.

The operations of the FEHBP do not result in any excess or deficiency of revenue or expense as this program has a special account available to compensate any excess or deficiency on its operations to the benefit or detriment of the federal government.  Any transfer to/from the special account necessary to cover any excess or deficiency in the operations of the FEHBP is recorded as a reduction/increment to the premiums earned.  The contract with OPM provides that the cumulative excess of the FEHBP earned income over health benefits charges and expenses represents a restricted fund balance denoted as the special account.  Upon termination of the contract and satisfaction of all the FEHBP’s obligations, any unused remainder of the special reserve would revert to the Federal Employees Health Benefit Fund.  In the event that the contract terminates and the special reserve is not sufficient to meet the FEHBP’s obligations, the FEHBP contingency reserve will be used to meet such obligations.  If the contingency reserve is not sufficient to meet such obligations, the Company is at risk for the amount not covered by the contingency reserve.

40

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The contract with OPM allows for the payment to the Company of service fees as negotiated between TSS and OPM.

The Company also has funds available related to the FEHBP amounting to $50,789 and $42,572 as of December 31, 2016 and 2015, respectively and are included within the cash and cash equivalents in the accompanying consolidated balance sheets.  Such funds are used to cover health benefits charges, administrative expenses and service charges required by the FEHBP.

A contingency reserve is maintained by the OPM at the U.S. Treasury, and is available to the Company under certain conditions as specified in government regulations.  Accordingly, such reserve is not reflected in the consolidated balance sheets.  The balance of such reserve as of December 31, 2016 and 2015 was $26,180 and $28,417, respectively.  The Company received $6,687, $4,763, and $12,766, of payments made from the contingency reserve fund of OPM during 2016, 2015, and 2014, respectively.

The claim payments and operating expenses charged to the FEHBP are subject to audit by the U.S. government.  Management is of the opinion that an adjustment, if any, resulting from such audits will not have a significant effect on the accompanying financial statements.  The claim payments and operating expenses reimbursed in connection with the FEHBP have been audited through 2011 by OPM.

FEP

In prior years, TSS entered into a contract with the BCBSA as per Contract No. C.S. 1039 with OPM to provide health benefits under one Government-wide Service Benefit Plan as contemplated in Title 5, Chapter 89, United States Code. The FEP covers employees and annuitants residing in the Commonwealth of Puerto Rico and the United States Virgin Islands as well as eligible dependents. The FEP is financed through a negotiated contribution made by the federal government and employees’ payroll deductions.  The accounting methodology and operations of the FEP are similar to those of the FEHBP as described before.

The Company also has funds overdraft related to the FEP amounting to $1,812 at December 31, 2016 and are included within the cash and cash equivalents in the accompanying balance sheets.

The claims payments and operating expenses charged to the FEP are subject to audit by the BCBSA. Management is of the opinion that the adjustments, if any, resulting from such audits will not have a significant effect in the accompanying financial statements. Operating expenses reimbursed in connection with the FEP have been audited through 2015 by BCBSA.

41

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

12. Long-Term Borrowings

A summary of the borrowings entered by the Company as of December 31 is as follows:

	2016		2015
Senior unsecured notes payable of $60,000 issued on
December 2005; due December 2020. Interest is payable monthly at a fixed rate of 6.60%.	$	24,000	$	24,000
Secured loan payable of $41,000, payable in monthly installments of $137 through July 1, 2024, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.23% at December 31, 2015.)		-		12,827
Secured loan payable of $11,187, payable in monthly installments of $137 through October 1, 2023, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.77% at December 31, 2016.)		11,187		-
Total borrowings		35,187		36,827
Less unamortized debt issuance costs		102		-
	$	35,085	$	36,827

Aggregate maturities of the Company’s borrowings as of December 31, 2016 are summarized as follows:

Year ending December 31
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
	$	35,187

All of the Company’s senior notes may be prepaid at par, in total or partially, five years after issuance as determined by the Company.  The Company’s senior unsecured notes contain certain non-financial covenants with which the Company has complied at December 31, 2016.

42

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

On December 28, 2016, TSM entered into a $35,500 credit agreement with a commercial bank in Puerto Rico. The agreement consists of three term loans: (i) Term Loan A in the principal amount of $11,187, (ii) Term Loan B in the principal amount of $20,150 and (iii) Term Loan C in the principal amount of $4,116. Term Loan A matures in October 2023 while the Term Loans B and C mature in January 2024.  Term Loan A was used to refinance the previous $41,000 secured loan payable with the same commercial bank in Puerto Rico.  Proceeds from Term Loans B and C were received on January 11, 2017 and were used to prepay the outstanding principal amount plus accrued interest of the 6.6% Senior Unsecured Notes due January 2021 ($24,000), and fund a portion of a debt service reserve for the Loan (approximately $200).  Pursuant to the credit agreement, interest is payable on the outstanding balance of the Loan at the following annual rate: (1) 1% over LIBOR for Term Loan A, (ii) 2.75% over LIBOR for Term Loan B, and (iii) 3.25% over LIBOR for Term Loan C.  Interest shall be payable commencing on January 1, 2017, in the case of Term Loan A, and on February 1, 2017, in the case of Term Loan B and Term Loan C.  The Credit Agreement includes certain financial and non-financial covenants, including negative covenants imposing certain restrictions on the Corporation’s business.  The Company was in compliance with all these covenants as of December 31, 2016.

The credit agreement is guaranteed by a first mortgage held by the bank on the Company’s land, building, and substantially all leasehold improvements, as collateral for the term of the loan under a continuing general security agreement.  This credit agreement contains certain non-financial covenants, which are customary for this type of facility, including but not limited to, restrictions on the granting of certain liens, limitations on acquisitions and limitations on changes in control and dividends.

The Company may, at its option, upon notice, as specified in the credit agreement, redeem and prepay prior to maturity, all or any part of the Loan and from time to time upon the payment of a penalty fee of 3% during the first year, 2% during the second year and 1% during the third year, and thereafter, at par, as specified in the credit agreement, together with accrued and unpaid interest, if any, to the date of redemption specified by the Company.

Interest expense on the above borrowings amounted to $1,763, $2,435, and $3,639, for the years ended December 31, 2016, 2015, and 2014, respectively.

43

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

13. Reinsurance Activity

The effect of reinsurance on premiums earned and claims incurred is as follows:

	Premiums Earned									Claims Incurred(1)
	2016			2015			2014			2016			2015			2014
Gross	$	2,949,673		$	2,847,288		$	2,199,351		$	2,458,447		$	2,313,191		$	1,748,972
Ceded		(59,032	)		(64,134	)		(70,785	)		(15,008	)		(19,430	)		(25,184	)
Net	$	2,890,641		$	2,783,154		$	2,128,566		$	2,443,439		$	2,293,761		$	1,723,788

⁽¹⁾ The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,806 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

TSS, TSP and TSV, in accordance with general industry practices, annually purchase reinsurance to protect them from the impact of large unforeseen losses and prevent sudden and unpredictable changes in net income and stockholders’ equity of the Company.  Reinsurance contracts do not relieve any of the subsidiaries from their obligations to policyholders.  In the event that all or any of the reinsuring companies might be unable to meet their obligations under existing reinsurance agreements, the subsidiaries would be liable for such defaulted amounts.  During 2016, 2015, and 2014 TSP placed 13.16%, 14.06%, and 13.26% of its reinsurance business with one reinsurance company.

TSS has excess of loss reinsurance treaties whereby it cedes a portion of its premiums to third parties.  Reinsurance contracts are primarily for periods of one year, and are subject to modifications and negotiations in each renewal date.  Premiums ceded under these contracts amounted to $3,148, $3,678, and $4,901 in 2016, 2015 and 2014, respectively.  Claims ceded amounted to $1,700, $2,665, and $5,487, in 2016, 2015 and 2014, respectively.  Principal reinsurance agreements include an organ transplant excess of loss treaty, which covers:

· For group policies, 80% of the claims up to a maximum of $800 (80% of $1,000), per person, per life. For other group policies with other options, the agreement covers 80% of the claims up to a maximum of $400 (80% of $500), per person, per life, or 80% of the claims up to a maximum of $200 (80% of $250), per person, per life.

· For policies provided to the active and retired employees of the Commonwealth of Puerto Rico and its instrumentalities, the treaty covers 100% of the claims up to a maximum of $500 per person, per life with a basic coverage, and $1,000 per person, per life with Major medical coverage.

· For policies provided to the municipalities of Puerto Rico, the treaty covers 100% of the claims up to a maximum of $250 with plans with lifetime limits and all other plans 100% of the claims up to a maximum of $1,000.

44

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

· For U.S. Virgin Islands policies, the treaty covers 100% of the claims up to a maximum of $2,000 per person, per life.  The first $200 are retained by Triple-S and the excess up to $800 are reinsured.

TSP has a number of pro rata and excess of loss reinsurance treaties whereby the subsidiary retains for its own account all loss payments for each occurrence that does not exceed the stated amount in the agreements and a catastrophe cover, whereby it protects itself from a loss or disaster of a catastrophic nature.  Under these treaties, TSP ceded premiums of $45,957, $48,676, and $52,058, in 2016, 2015, and 2014, respectively.

Reinsurance cessions are made on excess of loss and on a proportional basis.  Principal reinsurance agreements are as follows:

· Property quota share treaty covering for a maximum of $30,000 for any one risk.  Under this treaty 30% of the risk is ceded to reinsurers.  The remaining exposure is covered by a property per risk excess of loss treaty that provides reinsurance in excess of $500 up to a maximum of $21,000, or the remaining 70% for any one risk.  In addition, TSP has an additional property catastrophe excess of loss contract that provides protection for losses in excess of $8,000 resulting from any catastrophe, subject to a maximum loss of $15,000.

· Personal property catastrophe excess of loss.  This treaty provides protection for losses in excess of $5,000 resulting from any catastrophe, subject to a maximum loss of $80,000.

· Commercial property catastrophe excess of loss.  This treaty provides protection for losses in excess of $10,000 resulting from any catastrophe, subject to a maximum loss of $135,000.

· Property catastrophe excess of loss.  This treaty provides a $235,000 protection in excess of $80,000 and $135,000 with respect to personal and commercial lines, respectively, resulting from any catastrophe, subject to a maximum loss of $175,000 in respect of the ceded portion of the Commercial Lines Quota Share.

· Reinstatement premium protection.  This treaty provides a maximum limit of approximately $3,400 for personal lines and $10,000 in commercial lines to cover the necessity of reinstating the catastrophe program in the event it is activated.

· Casualty excess of loss treaty.  This treaty provides reinsurance for losses in excess of $225 up to a maximum of $12,000.

· Medical malpractice excess of loss.  This treaty provides reinsurance in excess of $150 up to a maximum of $3,000 per incident.

· Builders’ risk quota share and first surplus covering contractors’ risk.  This treaty provides protection on a 20/80 quota share basis for the initial $2,500 and a first surplus of $12,500 for a maximum of $14,500 for any one risk.

· Surety quota share treaty covering contract and miscellaneous surety bond business. This treaty provides reinsurance of up to $5,000 for contract surety bonds, subject to an aggregate of $10,000 per contractor and $3,000 per miscellaneous surety bond.

45

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Facultative reinsurance is obtained when coverage per risk is required. All principal reinsurance contractsare for a period of one year, on a calendar basis, and are subject to modifications and negotiations in each renewal.

The ceded unearned reinsurance premiums on TSP arising from these reinsurance transactions amounted to $9,202 and $10,291 at December 31, 2016 and 2015, respectively, and are reported as other assets in the accompanying consolidated balance sheets.

TSV also cedes insurance with various reinsurance companies under a number of pro rata, excess of loss and catastrophe treaties. Under these treaties, TSV ceded premiums of $8,838, $9,596, and $10,328, in 2016, 2015, and 2014, respectively. Principal reinsurance agreements are as follows:

· Group life insurance facultative agreement, reinsuring risk in excess of $25 of certain group life policies and a combined pro rata and excess of loss agreement effective July 1, 2008, reinsuring 50% of the risk up to $200 and ceding the excess.

· Facultative pro rata agreements for the long‑term disability insurance, reinsuring 65% of the risk.

· Several reinsurance agreements, mostly on an excess of loss basis up to a maximum retention of $50. For certain new life products that have been issued after 1999, the retention limit is $175, and for others issued after January 1, 2015, the retention limit is $200.

· A quota share agreement for group major medical and an excess of loss agreements for group and individual major medical, where TSV cedes 40% of all claims up to a maximum retention of $100 and 70% of all claims over $100 up to a maximum of $2,000.

· Excess of loss agreement for the Major Medical Business in Costa Rica reinsuring 100% of all claims over $25.

TSV participates in various retrocession reinsurance agreements since early 2014. The retrocessions are based on group life and health reinsurance business pools for which TSV has participations ranging from 6.7% to 15% of the total reinsurance facility. TSV share of the reinsurer’s gross liability is limited to a maximum that ranges depending on the agreement from $50 to $500 per covered life. The agreements cover new and renewal business for a period of twelve months and may be cancelled subject to ninety days written notice at any anniversary date.

46

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

14. Income Taxes

The Company and its subsidiaries are subject to Puerto Rico income taxes. Under Puerto Rico income tax law, the Company is not allowed to file consolidated tax returns with its subsidiaries. The Company’s insurance subsidiaries are also subject to U.S. federal income taxes for foreign source dividend income.  The Company is potentially subject to income tax audits in the Commonwealth of Puerto Rico for the taxable year 2015, until the applicable statute of limitations expire. Tax audits by their nature are often complex and can require several years to complete.

Managed Care and Property and Casualty corporations are taxed essentially the same as other corporations, with taxable income primarily determined on the basis of the statutory annual statements filed with the insurance regulatory authorities. The corporations are also subject to an alternative minimum income tax, which is calculated based on the formula established by existing tax laws. Any alternative minimum income tax paid may be used as a credit against the excess, if any, of regular income tax over the alternative minimum income tax in future years up to a limit of 25% of the excess.

The Company, through one of its Managed Care corporations, has a branch in the United States Virgin Islands that is subject to a 5% premium tax on policies underwritten therein. As a qualified foreign insurance company, the Company is subject to income taxes in the U.S. Virgin Islands, which has implemented a mirror tax law based on the U.S. Internal Revenue Code.  The branch operations in the U.S. Virgin Islands had certain net operating losses for U.S. Virgin Islands tax purposes for which a valuation allowance has been recorded.

Companies within our Life Insurance segment operate as qualified domestic life insurance companies and are subject to the alternative minimum tax and taxes on its capital gains.

Federal income taxes recognized by the Company’s insurance subsidiaries amounted to approximately $733, $574, and $451, in 2016, 2015, and 2014, respectively.

All other corporations within the group are subject to Puerto Rico income taxes as regular corporations, as defined in the P.R. Internal Revenue Code, as amended.  The holding company within the TSA group of companies is a U.S.-based corporation and is subject to U.S. federal income taxes.  This U.S-based corporation within our group has not provided U.S. deferred taxes on an outside basis difference created as a result of the business combination of TSA and cumulative earnings of its Puerto Rico-based subsidiaries that are considered to be indefinitely reinvested.  The total outside basis difference at December 31, 2016 and 2015 is estimated at $26,000 and $59,000, respectively.  We do not intend to repatriate earnings to fund U.S. and Puerto Rico operations nor do any transaction that would cause a reversal of that outside basis difference.  Because of the availability of U.S. foreign tax credits, it is not practical to determine the U.S. federal income tax liability if such outside basis difference was reversed.

On July 1, 2014, the Governor of Puerto Rico signed into law Act No. 77 including multiple amendments to the Puerto Rico tax code that had a direct impact on the tax liabilities of individual and corporate taxpayers.  The amendments to the Puerto Rico tax code include, among others, changes to the corporate tax rate on long-term capital gains, which was increased from 15% to 20% for all transactions occurring after June 30, 2014.  During the year ended December 31, 2014, the Company recognized a one-time charge to operations of approximately $6,300 as a consequence of this change in the enacted rate to account for the effect of the increase in rate in the unrealized gain on its investment portfolio.

47

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Act No. 77 also allowed corporations to elect, during the period running from July 1, 2014 to October 31, 2014, to prepay at a reduced income tax rate of 12% the increase in value of long-term capital assets.  On December 22, 2014 and March 30, 2015, the Governor of Puerto Rico signed into law Act No. 238 and Act No. 44, respectively, providing further amendments to the provisions set forth by Act No.77, extending the period to prepay at the reduced tax rate of 12% on the increase in value of long-term capital assets until April 30, 2015.  In connection with this law, on April 15, 2015 and December 31, 2014, the group of corporations that comprise TSM entered into Closing Agreements with the Puerto Rico Department of Treasury.  The Closing Agreements, among other matters, were related with the payment of the preferential tax rate on the increase in value of some of its long-term capital assets, as permitted by Act No. 238 of 2014 and Act No. 44 of 2015.  The agreements also covered certain tax attributes of the Corporation.  As a result of the aforementioned tax laws and the Closing Agreements, the Company: (1) obtained a benefit from the lower tax rate provided under these statutes, (2) reassessed the realizability of some of its deferred taxes and (3) recorded a tax benefit of $2,524 for the year ended December 31, 2015.

The components of income tax (benefit) expense consisted of the following:

	2016			2015			2014
Current income tax expense	$	1,981		$	10,169		$	22,551
Deferred income tax benefit		(8,326	)		(5,070	)		(21,806	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

48

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The income tax (benefit) expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	2016			2015			2014
Income before taxes	$	11,086		$	57,131		$	66,051
Statutory tax rate		39.00	%		39.00	%		39.00	%
Income tax expense at statutory rate		4,324			22,281			25,760
Increase (decrease) in taxes resulting from
Exempt interest income, net		(5,158	)		(6,041	)		(7,139	)
Effect of taxing life insurance operations as a qualified domestic life insurance company instead of as a regular corporation		(5,033	)		(4,936	)		(5,572	)
Effect of taxing capital gains at a preferential rate		(3,799	)		(7,432	)		(14,248	)
Dividends received deduction		-			270			173
Adjustment to deferred tax assets and liabilities for changes in effective tax rates		1,669			(1,576	)		5,466
Other adjustments to deferred tax assets and liabilities		2,852			(58	)		(707	)
Effect of extraordinary dividend distribution from the Association - reported net of taxes in other income		(151	)		(875	)		-
Tax credit benefit		(709	)		(537	)		(1,482	)
Tax returns to provision true up		(181	)		(1,084	)		-
Effect of reassessment of unused credits for alternative minimum taxes paid		-			-			(6,486	)
Subtotal		(10,510	)		(22,269	)		(29,995	)
Other permanent disallowances, net:
Disallowed resolution agreements expense		-			1,716			-
Disallowance of expenses related to exempt interest income		58			-			46
Disallowed dividend received deduction		-			3,598			4,815
Disallowed interest expense		8			12			21
Other		-			61			282
Total other permanent differences		66			5,387			5,164
Other adjustments		(225	)		(300	)		(184	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

49

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Deferred income taxes reflect the tax effects of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and income tax purposes. The net deferred tax asset at December 31, 2016 and 2015 of the Company and its subsidiaries is composed of the following:

	2016			2015
Deferred tax assets
Allowance for doubtful receivables	$	10,070		$	13,434
Liability for pension benefits		10,624			21,416
Employee benefits plan		1,580			3,177
Postretirement benefits		772			1,252
Deferred compensation		2,041			1,818
Accumulated depreciation		1,137			1,240
Impairment loss on investments		2,035			1,749
Contingency reserves		-			30
Share-based compensation		4,393			4,875
Alternative minimum income tax credit		1,991			2,066
Purchased tax credits		6,062			931
Net operating loss		33,081			12,721
Difference in tax basis of investments portfolio		3,049			6,843
Accrued liabilities		2,133			2,402
Other		772			591
Gross deferred tax assets		79,740			74,545
Less: valuation allowance		(8,016	)		(7,839	)
Deferred tax assets		71,724			66,706
Deferred tax liabilities
Deferred policy acquisition costs		(6,621	)		(3,673	)
Catastrophe loss reserve		(8,020	)		(7,664	)
Unrealized gain on securities available for sale		(15,804	)		(15,021	)
Unamortized debt issue costs		(152	)		(29	)
Intangible asset		(2,195	)		(3,013	)
Accumulated depreciation		(14	)		(15	)
Gross deferred tax liabilities		(32,806	)		(29,415	)
Net deferred tax asset	$	38,918		$	37,291

The net deferred tax asset shown in the table above at December 31, 2016 and 2015 is reflected in the consolidated balance sheets as $57,768 and $52,361, respectively, in deferred tax assets and $18,850 and $15,070, in deferred tax liabilities, respectively, reflecting the aggregate deferred tax assets or liabilities of individual tax-paying subsidiaries of the Company.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management believes that it is more likely than not that the Company will realize the benefits of these deductible differences.  The valuation allowance is mostly related with the net operating losses generated by the Company’s U.S. Virgin Islands and health clinic’s operations that based on the available evidence are not considered to be realizable at the reporting dates.

50

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

At December 31, 2016, the Company and its subsidiaries has net operating loss carry-forwards for Puerto Rico income tax purposes of approximately $75,000, which are available to offset future taxable income for up to December 2026. Except for the valuation allowance described in the previous paragraph, the corporation concluded that as of December 31, 2016,  it is more likely than not that the entities that have these net operating loss carry-forwards will generate sufficient taxable income within  the applicable  net operating loss carry-forward periods  to realize its deferred tax asset. This conclusion is based on the historical results of each entity, adjusted to exclude non-recurring conditions, and the forecast of future profitability. Management will continue to evaluate, on a quarterly basis, if there are any significant events that will affect the corporation’s ability to utilize these deferred tax assets.

15. Pension Plans

Noncontributory Defined‑Benefit Pension Plan

The Company sponsors a noncontributory defined-benefit pension plan for its employees and for the employees of certain subsidiaries.  Pension benefits begin to vest after five years of vesting service, as defined, and are based on years of service and final average salary, as defined. The funding policy is to contribute to the plan as necessary to meet the minimum funding requirements set forth in the Employee Retirement Income Security Act of 1974, as amended, plus such additional amounts as the Company may determine to be appropriate from time to time.  The measurement date used to determine pension benefit for the pension plan is December 31.

51

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following table sets forth the plan’s benefit obligations, fair value of plan assets, and funded status as of December 31, 2016 and 2015, accordingly:

	2016			2015
Change in benefit obligation
Benefit obligation at beginning of year	$	184,782		$	205,254
Service cost		3,640			4,137
Interest cost		8,749			8,281
Benefit payments		(12,911	)		(7,591	)
Actuarial (gain) loss		14,709			(25,299	)
Liability gain due to curtailment		(35,092	)		-
Benefit obligation at end of year	$	163,877		$	184,782
Accumulated benefit obligation at end of year	$	163,877		$	152,851
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	130,061		$	128,108
Actual return on assets		13,248			1,544
Employer contributions		10,000			8,000
Benefit payments		(12,911	)		(7,591	)
Fair value of plan assets at end of year	$	140,398		$	130,061
Funded status at end of year	$	(23,479	)	$	(54,721	)
Amounts in accumulated other comprehensive income not yet recognized as a component of net periodic pension cost
Development of prior service credit
Balance at beginning of year	$	(2,223	)	$	(2,673	)
Amortization		450			450
Curtailment/Settlement		1,773			-
Net prior service credit		-			(2,223	)
Development of actuarial loss
Balance at beginning of year		55,716			80,118
Amortization		(4,028	)		(5,939	)
(Gain)/Loss arising during the year		10,464			(18,463	)
Curtailment/Settlement gain during the year		(35,092	)		-
Actuarial net loss		27,060			55,716
Sum of deferrals	$	27,060		$	53,493
Net amount recognized	$	3,581		$	(1,228	)

52

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following assumptions were used on a weighted average basis to determine benefits obligations of the plan as of December 31, 2016 and 2015.

	2016			2015
Discount rate		4.50	%		4.75	%
Rate of compensation increase		N/A		Graded; 3.50		%
				to 8.00		%

The assumed discount rate of 4.50% at December 31, 2016 reflects the hypothetical rate at which the projected benefit obligations could be effectively settled or paid out to participants on that date. The Company determined the discount rate based on a range of factors, including a yield curve comprised of the rates of return on high-quality, fixed-income corporate bonds available at the measurement date and the related expected duration for the obligations.

The amounts recognized in the balance sheets as of December 31, 2016 and 2015 consist of the following:

	2016		2015
Pension liability	$	23,479	$	54,721
Accumulated other comprehensive loss, net of a deferred tax of $7,191 and $17,500 in 2016 and 2015, respectively		19,869		35,993

The components of net periodic benefit cost for 2016, 2015, and 2014 were as follows:

	2016			2015			2014
Components of net periodic benefit cost
Service cost	$	3,640		$	4,137		$	3,589
Interest cost		8,749			8,281			8,287
Expected return on plan assets		(9,003	)		(8,380	)		(7,496	)
Prior service benefit		(450	)		(450	)		(450	)
Actuarial loss		4,028			5,939			4,134
Net periodic benefit cost	$	6,964		$	9,527		$	8,064

Net periodic benefit cost may include settlement charges as a result of retirees selecting lump-sum distributions. Settlement charges may increase in the future if the number of eligible participants deciding to receive distributions and the amount of their benefits increases.  There were no settlement charges during the years ended December 31, 2016, 2015 and 2014.

In December 2016, the Company announced that effective January 31, 2017, it will freeze the pay and service amounts used to calculate pension benefits for active employees who participated in the pension plan. Therefore, as of the Effective Date, active employees in the pension plan will not accrue additional benefits for future service and eligible compensation received.  As a result of these changes, the Company recognized a pre-tax curtailment income of $1,773 during the year ended December 31, 2016.

53

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The estimated net actuarial loss that will be amortized from accumulated other comprehensive loss into net periodic pension benefits cost during the next twelve months is $345.

The following assumptions were used on a weighted average basis in computing the periodic benefit cost for the years ended December 31, 2016, 2015, and 2014:

	2016			2015			2014
Discount rate		4.75	%		4.25	%		5.25	%
Expected return on plan assets		7.00	%		7.00	%		7.00	%
Rate of compensation increase	Graded; 3.50		%	Graded; 3.50		%	Graded; 3.50		%
	to 8.00		%	to 8.00		%	to 8.00		%

The basis of the overall expected long-term rate of return on assets assumption is a forward-looking approach based on the current long-term capital market outlook assumptions of the assets categories in which the trust invests and the trust’s target asset allocation. At December 31, 2016, the assumed target asset allocation for the program is: 44% to 56% in equity securities, 34% to 46% in debt securities, and 6% to 14% in other securities. Using a mean-variance model to project returns over a 30-year horizon under the target asset allocation, the 35 to 65 percentile range of annual rates of return is 5.7% to 7.1%. The Company selected a rate from within this range of 7.00% for 2016 and 2015, which reflects the Company’s best estimate for this assumption based on the data described above, information on the historical returns on assets invested in the pension trust, and expected future conditions. This rate is net of both investment related expenses and a 0.15% reduction for other administrative expenses charged to the trust.

Plan Assets

Plan assets recorded at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. For level inputs and input definition, see Note 9.

54

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	6,276		$	-	$	6,276
Non-agency backed securities		-		715			-		715
Corporate obligations		-		7,243			-		7,243
Partnership/Joint venture		-		-			932		932
Limited Liability Corporations		-		98,188			-		98,188
Real estate		-		-			6,617		6,617
Registered investments		3,839		1,869			-		5,708
Common/Collective trusts		-		7,334			-		7,334
Hedge funds		-		4,581			-		4,581
Common stocks		1,515		1			-		1,516
Preferred stocks		107		12			-		119
Forward foreign currency contracts		-		(1	)		-		(1	)
Interest-bearing cash		2,224		-			-		2,224
Derivatives		-		27			-		27
	$	7,685	$	126,245		$	7,549	$	141,479

	2015
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	9,009		$	-	$	9,009
Non-agency backed securities		-		745			-		745
Corporate obligations		-		10,865			-		10,865
Partnership/Joint venture		-		-			567		567
Limited Liability Corporations		-		60,417			-		60,417
Real estate		-		-			5,929		5,929
Registered investments		6,224		5,927			-		12,151
Common/Collective trusts		-		16,479			-		16,479
Hedge funds		-		8,284			-		8,284
Common stocks		1,985		-			-		1,985
Preferred stocks		121		-			-		121
Forward foreign currency contracts		-		3			-		3
Interest-bearing cash		550		-			-		550
Derivatives		-		(28	)		-		(28	)
	$	8,880	$	111,701		$	6,496	$	127,077

55

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the year ended December 31, 2016 and 2015 is as follows:

	Government Obligations		Corporate Obligations		Partnership/ Joint Venture			Real Estate			Hedge Funds		Total
Beginning balance at December 31, 2014	$	.		.		1,097			6,197			-	$	7,294
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		103			384			-		487
Relating to assets sold during the period		-		-		(39	)		636			-		597
Purchases, issuances, and settlements		-		-		(594	)		(1,288	)		-		(1,882	)
Transfer in and/or out		-		-		-			-			-		-
Ending balance at December 31, 2015		-		-		567			5,929			-		6,496
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		19			501			-		520
Relating to assets sold during the period		-		-		1			72			-		73
Purchases, issuances, and settlements		-		-		345			324			-		669
Transfer in and/or out		-		-		-			(209	)		-		(209	)
Ending balance at December 31, 2016	$	-	$	-	$	932		$	6,617		$	-	$	7,549

The Company’s plan assets are invested in the National Retirement Trust. The National Retirement Trust was formed to provide financial and legal resources to help members of the BCBSA offer retirement benefits to their employees.

The investment program for the National Retirement Trust is based on the precepts of capital market theory that are generally accepted and followed by institutional investors, who by definition are long‑term oriented investors. This philosophy holds that:

· Increasing risk is rewarded with compensating returns over time, and therefore, prudent risk taking is justifiable for long-term investors.

· Risk can be controlled through diversification of asset classes and investment approaches, as well as diversification of individual securities.

· Risk is reduced by time, and over time the relative performance of different asset classes is reasonably consistent. Over the long-term, equity investments have provided and should continue to provide superior returns over other security types. Fixed-income securities can dampen volatility and provide liquidity in periods of depressed economic activity.  Lengthening duration of fixed income securities may reduce surplus volatility.

· The strategic or long-term allocation of assets among various asset classes is an important driver of long‑term returns.

· Relative performance of various asset classes is unpredictable in the short‑term and attempts to shift tactically between asset classes are unlikely to be rewarded.

Investments will be made for the sole interest of the participants and beneficiaries of the programs participating in the National Retirement Trust. Accordingly, the assets of the National Retirement Trust shall be invested in accordance with these objectives:

· To ensure assets are available to meet current and future obligations of the participating programs when due.

56

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

· To earn the maximum return that can be realistically achieved in the markets over the long‑term at a specified and controlled level of risk in order to minimize future contributions.

· To invest assets with consideration of the liability characteristics in order to better align assets and liabilities.

· To invest the assets with the care, skill, and diligence that a prudent person acting in a like capacity would undertake. In the process, the Administration of the Trust has the objective of controlling the costs involved with administering and managing the investments of the National Retirement Trust.

Cash Flows

The Company expects to contribute $4,000 to its pension program in 2017.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

Year ending December 31
2017	$	8,253
2018		8,748
2019		9,047
2020		9,322
2021		9,314
2022 – 2026		49,252

Noncontributory Supplemental Pension Plan

In addition, the Company sponsors a noncontributory supplemental pension plan. This plan covers employees with qualified defined benefit retirement plan benefits limited by the U.S. Internal Revenue Code maximum compensation and benefit limits.  At December 31, 2016 and 2015, the Company has recorded a pension liability of $7,413 and $8,224, respectively.  The charge to accumulated other comprehensive loss related to the noncontributory pension plan at December 31, 2016 and 2015 amounted to $107 and $862, respectively, net of a deferred tax asset of $73 and $556, respectively.

16. Catastrophe Loss Reserve and Trust Fund

In accordance with Chapter 25 of the Puerto Rico Insurance Code, as amended, TSP is required to record a catastrophe loss reserve. This catastrophe loss reserve is supported by a trust fund for the payment of catastrophe losses. The reserve increases by amounts determined by applying a contribution rate, not in excess of 5%, to catastrophe written premiums as instructed annually by the Commissioner of Insurance, unless the level of the reserve exceeds 8% of catastrophe exposure, as defined. The reserve also increases by an amount equal to the resulting return in the supporting trust fund and decreases by payments on catastrophe losses or authorized withdrawals from the trust fund. Additions to the catastrophe loss reserve are deductible for income tax purposes.

57

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

This trust may invest its funds in securities authorized by the Insurance Code, but not in investments whose value may be affected by hazards covered by the catastrophic insurance losses. The interest earned on these investments and any realized gains (loss) on investment transactions are part of the trust fund and are recorded as income (expense) of the Company. An amount equal to the investment returns is recorded as an addition to the trust fund.

The interest earning assets in this fund, which amounted to $47,630 and $46,221 as of December 31, 2016 and 2015, respectively, are to be used solely and exclusively to pay catastrophe losses covered under policies written in Puerto Rico.

TSP is required to contribute to the trust fund, if needed or necessary, on or before January 31 of the following year. Contributions are determined by a rate determined or established by the Commissioner of Insurance for the catastrophe policies written in that year. No contribution was required for 2016 and 2015 since the level of the catastrophe reserve exceeds 8% of the catastrophe exposure.

The amount in the trust fund may be withdrawn or released in the case that TSP ceases to underwrite risks subject to catastrophe losses. Also, authorized withdrawals are allowed when the catastrophe loss reserve exceeds 8% of the catastrophe exposure, as defined.

TSP retained earnings are restricted in the accompanying consolidated balance sheets by the total catastrophe loss reserve balance, which as of December 31, 2016 and 2015 amounted to $44,823 and $43,041, respectively.

17. Stockholders’ Equity

a. Common Stock

On November 12, 2015, the Company converted 1,426,721 issued and outstanding Class A shares into Class B common stock purchased pursuant to the provisions of the Articles of incorporation approved by Class A shareholders at the time of the Company’s Initial Public Offering.

b. Preferred Stock

Authorized capital stock includes 100,000,000 of preferred stock with a par value of $1.00 per share. As of December 31, 2016 and 2015, there are no issued and outstanding preferred shares.

c. Liquidity Requirements

As members of the BCBSA, the Company, TSS, and TSA are required by membership standards of this association to maintain liquidity as defined by BCBSA. That is, to maintain net worth exceeding the Company Action Level as defined in the National Association of Insurance Commissioners’ (NAIC) Risk-Based Capital for Insurers Model Act. The companies are in compliance with this requirement.

58

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

d. Dividends

As a holding company, the Company’s most significant assets are the common shares of its subsidiaries.  The principal sources of funds available to the Company are rental income and dividends from its subsidiaries, which are used to fund our debt service and operating expenses.

The Company is subject to the provisions of the General Corporation Law of Puerto Rico, which restricts the declaration and payment of dividends by corporations organized pursuant to the laws of Puerto Rico.  These provisions provide that Puerto Rico corporations may only declare dividends charged to their retained earnings or, in the absence of retained earnings, net profits of the fiscal year in which the dividend is declared and/or the preceding fiscal year.

The Company’s ability to pay dividends is dependent, among other factors, on its ability to collect cash dividends from its subsidiaries, which are subject to regulatory requirements, which may restrict their ability to declare and pay dividends or distributions.  In addition, an outstanding secured term loan restricts our ability to pay dividends in the event of default (see note 11).

The accumulated earnings of TSS, TSA, TSV, TSB and TSP are restricted as to the payment of dividends by statutory limitations applicable to domestic insurance companies. Under Puerto Rico insurance regulations, the regulated subsidiaries are permitted, without requesting prior regulatory approval, to pay dividends as long as the aggregate amount of all such dividends in any calendar year does not exceed the lesser of: (i) 10% of its surplus as of the end of the immediately preceding calendar year; or (ii) its statutory net gain from operations for the immediately preceding calendar year (excluding realized capital gains).  Regulated subsidiaries will be permitted to pay dividends in excess of the lesser of such two amounts only if notice of its intent to declare such a dividend and the amount thereof is filed with the Commissioner of Insurance and such dividend is not disapproved within 30 days of its filing. As of December 31, 2016, the dividends permitted to be distributed in 2016 by the regulated subsidiaries without prior regulatory approval from the Commissioner of Insurance amounted to approximately $43,000.  This amount excludes any dividend from TSA because as stated in note 14, we do not intend to repatriate earnings from this subsidiary nor do any transaction that would cause a reversal on an outside basis difference created as a result of the business combination of TSA and cumulative earnings of its Puerto Rico-based subsidiaries that are considered to be indefinitely reinvested.

18. Stock Repurchase Programs

The Company repurchases shares through open market transactions, in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended, under repurchase programs authorized by the Board of Directors.  Shares purchased under share repurchase programs are retired and returned to authorized and unissued status.

A summary of share repurchase programs in place during the three-year-period ended December 31, 2016 is as follows:

· In July 2013 the Company’s Board of Directors authorized a $11,500 repurchase program (2013 $11,500 stock repurchase program) of its Class B common stock.  This program was discontinued on October 28, 2014.

59

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

· In October 2014 the Company’s Board of Directors authorized a $50,000 repurchase program (2014 $50,000 share repurchase program) of its Class B common stock. This program was completed on October 7, 2015.

· In November 2015 the Company’s Board of Directors authorized a $25,000 repurchase program (2015 $25,000 share repurchase program) of its Class B common stock.  This program was completed on September 14, 2016.

The stock repurchase activity under stock repurchase programs for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	2016						2015						2014
	Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased
2015  $25,000 program		951,831	$	22.54	$	21,370		154,554	$	23.72	$	3,629		-	$	-	$	-
2014  $50,000 program		-		-		-		2,086,532		21.69		44,658		228,525		23.55		5,341
2013  $11,500 program		-		-		-		-		-		-		367,700		16.32		5,995
Total		951,831	$	22.54	$	21,370		2,241,086	$	21.87	$	48,287		596,225	$	20.28	$	11,336

19. Comprehensive Income

The accumulated balances for each classification of other comprehensive income are as follows:

	Unrealized Gains on securities			Liability for Pension Benefits			Accumulated Other Comprehensive Income
Beginning balance at December 31, 2015	$	62,478		$	(36,855	)	$	25,623
Net current period change		14,761			15,728			30,489
Reclassification adjustments for gains and losses reclassified in income		(14,868	)		1,151			(13,717	)
Ending balance at December 31, 2016	$	62,371		$	(19,976	)	$	42,395

60

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The related deferred tax effects allocated to each component of other comprehensive income in the accompanying consolidated statements of stockholders’ equity and comprehensive income in 2016, 2015 and 2014 are as follows:

	2016
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	18,357		$	(3,596	)	$	14,761
Less reclassification adjustment for gains and losses realized in income		(17,379	)		2,511			(14,868	)
Net change in unrealized gain		978			(1,085	)		(107	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		1,888			(737	)		1,151
Net change arising from assumptions and plan changes and experience		25,783			(10,055	)		15,728
Net change in liability for pension benefits		27,671			(10,792	)		16,879
Net current period change	$	28,649		$	(11,877	)	$	16,772

	2015
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	(25,765	)	$	3,153		$	(22,612	)
Less reclassification adjustment for gains and losses realized in income		(18,941	)		2,564			(16,377	)
Net change in unrealized gain		(44,706	)		5,717			(38,989	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		6,020			(2,348	)		3,672
Net change arising from assumptions and plan changes and experience		19,940			(7,776	)		12,164
Net change in liability for pension benefits		25,960			(10,124	)		15,836
Net current period change	$	(18,746	)	$	(4,407	)	$	(23,153	)

61

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2014
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	58,831		$	(8,161	)	$	50,670
Less reclassification adjustment for gains and losses realized in income		(18,231	)		3,444			(14,787	)
Net change in unrealized gain		40,600			(4,717	)		35,883
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		3,737			(1,457	)		2,280
Net change arising from assumptions and plan changes and experience		(35,271	)		13,755			(21,516	)
Net change in liability for pension benefits		(31,534	)		12,298			(19,236	)
Net current period change	$	9,066		$	7,581		$	16,647

20. Share-Based Compensation

In December 2007 the Company adopted the 2007 Incentive Plan (the Plan), which permits the Board to grant stock options, restricted stock awards and performance awards to eligible officers, directors and employees. The Plan authorizes the granting of up to 4,700,000 of Class B common shares of authorized but unissued stock. At December 31, 2016 and 2015, there were 1,333,093 and 1,677,395 shares available for the Company to grant under the Plan, respectively. Stock options can be granted with an exercise price at least equal to the stock’s fair market value at the grant date. The stock option awards vest in equal annual installments over 3 years and their expiration date cannot exceed 7 years. The restricted stock and performance awards are issued at the fair value of the stock on the grant date with vesting periods ranging from one to three years. Restricted stock awards vest in installments, as stipulated in each restricted stock agreement. Performance awards vest on the last day of the performance period, provided that at least minimum performance standards are achieved.

The fair value of each option award is estimated on the grant date using the Black‑Scholes option-pricing model that uses the weighted average assumptions in the following table. In absence of adequate historical data, the Company estimates the expected life of the option using the simplified method allowed by Staff Accounting Bulletin (SAB) No. 107. Since the Company was a newly public entity, expected volatility was computed based on the average historical volatility of similar entities with publicly traded shares. The risk-free rate for the expected term of the option was based on the U.S. Treasury zero-coupon bonds yield curve in effect at the time of grant.

62

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Stock option activity during the year ended December 31, 2016 is as follows:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding balance at January 1, 2016		4,440		$	12.49
Exercised during the year		(4,440	)	$	12.49
Outstanding balance at December 31, 2016		-		$	-		N/A	$	-
Exercisable at December 31, 2016		-		$	-		N/A	$	-

No options were granted during the three years ended December 31 2016, 2015 and 2014.  There were 4,440, 12,913, and 199,002 exercised options during 2016, 2015 and 2014, respectively.  No cash was received from stock options exercises during the years ended December 31, 2016 and 2015.  During the years ended December 31, 2016, 2015 and 2014, 2,290, 7,235, and 174,090 shares, respectively, were repurchased and retired as a result of non-cash exercise of stock options.

A summary of the status of the Company’s nonvested restricted and performance shares as of December 31, 2016, and changes during the year ended December 31, 2016, are presented below:

	Restricted Awards					Performance Awards
	Number of Shares			Weighted Average Fair Value		Number of Shares			Weighted Average Exercise Price
Outstanding balance at January 1, 2016		156,331		$	19.45		495,005		$	17.84
Granted		110,181			23.78		234,121			23.85
Lapsed		(99,276	)		20.14		(89,171	)		16.17
Forfeited (due to termination)		(5,412	)		20.27		(60,218	)		16.67
Forfeited (due to performance payout less than 100%)		-			-		(121,542	)		18.61
Outstanding balance at December 31, 2016		161,824		$	21.94		458,195		$	21.44

The weighted average grant date fair value of restricted shares granted during the year 2016, 2015 and 2014 were $23.78, $20.33, and $16.46, respectively. Total fair value of restricted stock vested during the year ended December 31, 2016, 2015 and 2014 was $2,335, $3,608 and $1,146, respectively.

At December 31, 2016 there was $6,785 of total unrecognized compensation cost related to nonvested share‑based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.02 years. The Company currently uses authorized and unissued Class B common shares to satisfy share award exercises.

63

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

21. Net Income Available to Stockholders and Basic Net Income per Share

The following table sets forth the computation of basic and diluted earnings per share for the three-year period ended December 31:

	2016		2015		2014
Numerator for earnings per share
Net income attributable to TSM available to stockholders	$	17,438	$	52,121	$	65,660
Denominator for basic earnings per share –
Weighted average of common shares		24,454,435		25,674,079		27,102,127
Effect of dilutive securities		56,658		87,662		86,705
Denominator for diluted earnings per share		24,511,093		25,761,741		27,188,832
Basic net income per share attributable to TSM	$	0.71	$	2.03	$	2.42
Diluted net income per share attributable to TSM	$	0.71	$	2.02	$	2.41

22. Commitments

The Company leases its regional offices, certain equipment, and warehouse facilities under non-cancelable operating leases. Minimum annual rental commitments at December 31, 2016 under existing agreements are summarized as follows:

Year ending December 31
2017	$	4,213
2018		3,936
2019		3,565
2020		2,345
2021		3,777
Total	$	17,836

Rental expense for 2016, 2015, and 2014 was $7,613, $7,730, and $8,738 respectively.

Pursuant to the provisions of the Puerto Rico Insurance Code and Regulations, TSP is a member of the Compulsory Vehicle Liability Insurance Joint Underwriting Association (the Association).  As a participant, TSP shares the risk, proportionately with other members, based on a formula established by the Puerto Rico Insurance Code, of the results and financial condition of the Association, and accordingly, may be subject to assessments to cover obligations of the Association or may receive refund distributions for good experience.  In December 2015, the Association declared an extraordinary dividend to its members for $21,000 subject to a special tax rate of 15% as allowed by Act No. 201 of December 7, 2015.   The dividend was received net of tax in three installments in 2016.  During the year ended December 31, 2015, TSP recorded a special distribution of $1,672, net of tax, which is included as other income in the accompanying consolidated statements of earnings.

64

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

23. Contingencies

The Company’s business is subject to numerous laws and regulations promulgated by Federal, Puerto Rico, USVI, Costa Rica, BVI, and Anguilla governmental authorities. Compliance with these laws and regulations can be subject to government review and interpretation, as well as regulatory actions unknown and unasserted at this time. The Commissioner of Insurance of Puerto Rico, as well as other Federal, Puerto Rico, USVI, Costa Rica, BVI, and Anguilla government authorities, regularly make inquiries and conduct audits concerning the Company's compliance with such laws and regulations. Penalties associated with violations of these laws and regulations may include significant fines and exclusion from participating in certain publicly funded programs and may require the Company to comply with corrective action plans or changes in our practices.

As of December 31, 2016, the Company is involved in various legal actions arising in the ordinary course of business. The Company is also defendant in various other litigations and proceedings, some of which are described below.  Where the Company believes that a loss is both probable and estimable, such amounts have been recorded. Although the Company believes the estimates of such losses are reasonable, these estimates could change as a result of further developments in these matters. In other cases, it is at least reasonably possible that the Company may incur a loss related to one or more of the mentioned pending lawsuits or investigations, but the Company is unable to estimate the range of possible loss which may be ultimately realized, either individually or in the aggregate, upon their resolution.  The outcome of legal proceedings is inherently uncertain and pending matters for which accruals have not been established have not progressed sufficiently to enable us to estimate a range of possible loss, if any.  Given the inherent unpredictability of these matters, it is possible that an adverse outcome in one or more of these matters could have a material adverse effect on the consolidated financial condition, operating results and/or cash flows of the Company.

Additionally, we may face various potential litigation claims that have not been asserted to date, including claims from persons purporting to have rights to acquire shares of the Company on favorable terms pursuant to agreements previously entered by our predecessor managed care subsidiary, Seguros de Servicios de Salud de Puerto Rico, Inc. (SSS), with physicians or dentists who joined our provider network to sell such new provider shares of SSS at a future date (Share Acquisition Agreements) or to have inherited such shares notwithstanding applicable transfer and ownership restrictions.

Claims by Heirs of Former Shareholders

The Company and Triple-S Salud, Inc. (TSS) are defending eight individual lawsuits, all filed in state court, from persons who claim to have inherited a total of 113 shares of the Company or one of its predecessors or affiliates (before giving effect to the 3,000-for-one stock split). While each case presents unique facts and allegations, the lawsuits generally allege that the redemption of the shares by the Company pursuant to transfer and ownership restrictions contained in the Company's (or its predecessors' or affiliates') articles of incorporation and bylaws was improper.

In one of these cases, entitled Vera Sánchez, et al, v. Triple-S, filed on July 31, 2008, the plaintiffs argued that the redemption of shares was fraudulent and was not subject to the two-year statute of limitations contained in the local securities law. The Puerto Rico Court of First Instance dismissed the claim and determined it was time barred under the local securities law. On January 27, 2012, the Puerto Rico Court of Appeals upheld the dismissal. On October 1, 2013, the Puerto Rico Supreme Court reversed the dismissal, holding that the two-year statute of limitations contained in the local securities law did not apply and returning the case to the Court of First Instance. On December 16, 2015, the Company filed a motion for summary judgement and on November 29, 2016, the Court of First Instance held that plaintiff’s opposition to Triple-S’ motion for summary judgment did not comply with the Rules of Civil Procedures.  Triple-S has requested the Court to consider its motion for summary judgment as unopposed. The parties are awaiting further proceedings.

65

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

In the second case, entitled Olivella Zalduondo, et al, v. Seguros de Servicios de Salud, et al, filed on September 21, 2010, the Puerto Rico’s Court of First Instance granted the Company’s motion to dismiss on grounds that the complaint was time-barred under the two-year statute of limitations of the local securities laws. On appeal, the Court of Appeals affirmed the decision of the lower court. On January 8, 2013, the Puerto Rico Supreme Court ruled that the applicable statute of limitations is the fifteen-year period for collection of monies of the Puerto Rico Civil Code.  On January 28, 2013, the Company filed a motion for reconsideration which was subsequently denied. On March 26, 2013, plaintiffs amended their complaint, which was answered by the Company on April 16, 2013.  Discovery is ongoing.

In the third case, entitled Heirs of Dr. Juan Acevedo, et al, v. Triple-S Management Corporation, et al, filed on March 27, 2008, the Puerto Rico Court of First Instance denied our motion for summary judgment based on its determination that there are material issues of fact in controversy. In response to our appeal, the Puerto Rico Court of Appeals confirmed the decision of the Puerto Rico Court of First Instance and denied a subsequent plea for reconsideration. Both parties have filed motions for summary judgment and, consequently, their respective oppositions. The parties are awaiting the court’s decision on their respective motions for summary judgment.

The fourth case, entitled Montilla López, et al, v. Seguros de Servicios de Salud, et al, was filed on November 29, 2011 in the Puerto Rico Court of First Instance. The Company filed a motion to dismiss on the grounds that the claim is time barred under the local securities laws, which was denied by the court on January 24, 2013.  The parties have filed their respective motions for summary judgment and are awaiting further proceedings.

The fifth case, entitled Cebollero Santamaría v. Triple-S Salud, Inc., et al, was filed on March 26, 2013 in the Puerto Rio Court of First Instance.  On October 29, 2013, the Company filed a motion for summary judgment on the grounds that the claim is time-barred under the fifteen-year statute of limitations of the Puerto Rico Civil Code for collection of monies and, in the alternative, that plaintiff failed to state a claim for which relief can be granted. Said motion was denied by the court.  On November 2, 2015, the Company filed a Writ of Certiorari with the Puerto Rico Court of Appeals, which was denied on March 8, 2016.  On March 23, 2016, the Company filed a request for reconsideration with the Puerto Rico Court of Appeals, which was denied on April 28, 2016.  Accordingly, on May 31, 2016, the Company filed a Writ of Certiorari with the Supreme Court of Puerto Rico.  The same was denied on September 23, 2016. The Company filed a motion for reconsideration before the Puerto Rico Supreme Court on October 11, 2016. The Supreme Court denied the reconsideration on December 2, 2016.  The Company has filed a second and final reconsideration motion which is still pending adjudication.

The sixth case, entitled Irizarry Antonmattei, et al, v. Seguros de Servicios de Salud, et al, was filed on April 16, 2013 in the Puerto Rico Court of First Instance.. On November 5, 2013, the Company moved to dismiss the first amended complaint and On May 16, 2014, plaintiffs filed a motion for summary judgment, which the Company opposed on May 28, 2014. On June 16, 2014, the court ordered plaintiffs to file a memorandum of law and struck plaintiff’s motion for summary judgment. On September 18, 2014, the court denied our motion to dismiss the amended complaint. On September 29, 2014, the Company filed a motion for reconsideration, which was denied by the court on November 4, 2014.  On December 4, 2014, the Company filed a petition of Writ of Certiorari with the Puerto Rico Court of Appeals, which was denied on April 1, 2015.  A status conference is scheduled for March 16, 2017. Discovery is ongoing.

The seventh case, entitled Allende Santos, et al, v. Triple-S Salud, et al, was filed on March 28, 2014 in the Puerto Rico Court of First Instance. On July 2, 2014, the Company filed its response. Discovery is ongoing.

The eighth case, entitled Ruiz de Porras, et al, v. Triple-S Salud, Inc., was filed on January 7, 2016 in the Puerto Rico Courts of First Instance. On March 28, 2016, the Company filed its response. Plaintiffs and the Company have filed various motions with the court and are awaiting further proceedings.

66

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Management believes these claims are time barred under one or more statutes of limitations and will vigorously defend them on these grounds; however, as a result of the Puerto Rico Supreme Court’s decision to deny the applicability of the statute of limitations contained in the local securities law, some of these claims will likely be litigated on their merits.

Joint Underwriting Association Litigations

On August 19, 2011, plaintiffs, purportedly a class of motor vehicle owners, filed an action in the United States District Court for the District of Puerto Rico against the Puerto Rico Joint Underwriting Association (JUA) and 18 other defendants, including Triple-S Propiedad (TSP), alleging violations under the Puerto Rico Insurance Code, the Puerto Rico Civil Code, the Racketeer Influenced and Corrupt Organizations Act (RICO) and the local statute against organized crime and money laundering. JUA is a private association created by law to administer a compulsory public liability insurance program for motor vehicles in Puerto Rico (CLI). As required by its enabling act, JUA is composed of all the insurers that underwrite private motor vehicle insurance in Puerto Rico and exceed the minimum underwriting percentage established in such act. TSP is a member of JUA.

In this lawsuit, entitled Noemí Torres Ronda, et al v. Joint Underwriting Association, et al., plaintiffs allege that the defendants illegally charged and misappropriated a portion of the CLI premiums paid by motor vehicle owners in violation of the Puerto Rico Insurance Code. Specifically, they claim that because the defendants did not incur in acquisition or administration costs allegedly totaling 12% of the premium dollar, charging for such costs constitutes the illegal traffic of premiums. Plaintiffs also claim that the defendants, as members of JUA, violated RICO through various inappropriate actions designed to defraud motor vehicle owners located in Puerto Rico and embezzle a portion of the CLI premiums for their benefit.

Plaintiffs seek the reimbursement of funds for the class amounting to $406,600 treble damages under RICO, and equitable relief, including a permanent injunction and declaratory judgment barring defendants from their alleged conduct and practices, along with costs and attorneys’ fees. Discovery has been completed.

Since 2011, TSP has been defending this claim and, jointly with other defendants, has filed several pleas in connection with the certification of the class and the dismissal of the claim. On December 17, 2015, three defendants filed a joint motion informing the court that said defendants are conducting negotiations to settle the claim and requested a 60-day period in other to continue the negotiations.  Subsequently, the term to continue negotiations was extended until April 17, 2016. On April 22, 2016, plaintiff and the negotiating defendants filed a stipulation of settlement and release which is subject to approval of the court. TSP and the non-settling defendants have objected the filed settlement. Procedures are ongoing.

In re Blue Cross Blue Shield Antitrust Litigation

TSS is a co-defendant with multiple Blue Plans and the Blue Cross Blue Shield Association (BCBSA) in a multi-district class action litigation entitled In re Blue Cross Blue Shield Association Antitrust Litigation, filed on July 24, 2012. The plaintiffs allege that the exclusive service area (ESA) requirements of the Primary License Agreements with the Blue Plans violate antitrust laws. The plaintiffs in these suits seek monetary awards and, in some instances, injunctive relief barring ESAs. Those cases have been centralized in the United States District Court for the Northern District of Alabama. Prior to centralization, motions to dismiss were filed by several plans, including TSS. The parties have filed several pleas and presented their position in argumentative hearings before the court in connection with the motion to dismiss, which was ultimately dismissed without prejudice by the court. On April 6, 2015, plaintiffs filed suit in the United States District Court of Puerto Rico, which we believe does not preclude TSS’ jurisdictional arguments. The Company has joined BCBSA in vigorously contesting these claims. Discovery is ongoing.

67

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

Claims Relating to the Provision of Health Care Services

TSS is a defendant in several claims for collection of monies in connection with the provision of health care services. Among them are individual complaints filed before ASES by six community health centers alleging TSS breached their contracts with respect to certain capitation payments and other monetary claims. Such claims have an aggregate value of approximately $9,600. Discovery is ongoing, and given the early stage of the cases, the Company cannot assess the probability of an adverse outcome or the reasonable financial impact that any such outcome may have on the Company. TSS believes many of these complaints are time-barred and will continue to conduct a vigorous defense.

On April 17, 2015, ASES notified the Company of a complaint from a medical service provider demanding payment amounting to $5,073.  Claimant alleges that TSS did not pay the claims, paid them incorrectly, or recovered payments from the provider for which TSS did not have the right. TSS answered the complaint and counterclaimed.  TSS denies any wrongdoing and will continue to defend this matter vigorously.

On January 12, 2015, American Clinical Solutions LLC, a limited liability company that provides clinical laboratory services filed a complaint in Florida state court alleging that Triple-S Management (TSM) and TSS failed to pay certain clinical laboratory services provided to Blue Cross Blue Shield members. TSS and TSM have filed a motion to dismiss alleging lack of jurisdiction. TSM and TSS also requested a transfer of the case to Puerto Rico. Plaintiff has requested jurisdictional discovery, which is ongoing. The claim amounts to $5,000. TSS and TSM will continue to vigorously oppose this claim.

ASES Audits

The Company is subject to numerous audits in connection with the provision of services to private and governmental entities.  These audits may include numerous aspects of our business, including claim payment practices, contractual obligations, service delivery, third-party obligations, and business practices, among others.  Deficiencies in audits could have a material adverse effect on our reputation and business, including termination of contracts, significant increases in the cost of managing and remediating deficiencies, payment of contractual penal clauses, and others, any of which could have a material and adverse effect on our results of operations, financial position and cash flows.

On July 2, 2014, ASES notified TSS that the results of an audit conducted in connection with the government health plan contract for several periods between October 2005 to September 2013, reflected overpayment of premiums made to TSS pursuant to prior contracts with ASES in the amount of $7,900. The alleged overpayments were related to duplicated payments or payments made for deceased members, and requested the reimbursement of the alleged overpayment. TSS contends that ASES’ request for reimbursement has no merits on several grounds, including a 2011 settlement between both parties covering the majority of the amount claimed by ASES, and that ASES, under the terms of the contracts, was responsible for certifying the membership.  On March 24, 2015, the court ruled that the scope of the 2011 settlement agreement did not preclude ASES from recovering “future claims” including the alleged improper payments. After the denial of a subsequent motion for reconsideration and a petition for a Writ of Certiorari by the Puerto Rico Court of Appeals, on January 21, 2016, TSS filed a Writ of Certiorari with the Supreme Court of Puerto Rico.  TSS also amended its claim to include the Puerto Rico Health Department (PRHD), as it asserts the PRHD is an indispensable party for the resolution of this matter.  With this amendment, TSS seeks payment of approximately $5,000, since the premiums paid to TSS should have been higher than what ASES actually paid given the additional risk assumed by TSS.  The matter is currently being addressed before a special commissioner assigned by the court. The Company will continue to conduct a vigorous defense of this matter.

68

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

24. Statutory Accounting

TSS, TSA, TSV and TSP (collectively known as the regulated subsidiaries) are regulated by the Commissioner of Insurance. The regulated subsidiaries are required to prepare financial statements using accounting practices prescribed or permitted by the Commissioner of Insurance, which uses a comprehensive basis of accounting other than GAAP. Specifically, the Commissioner of Insurance has adopted the NAIC’s Statutory Accounting Principles (NAIC SAP) as the basis of its statutory accounting practices, as long as they do not contravene the provisions of the Puerto Rico Insurance Code, its regulations and the Circular Letters issued by the Commissioner of Insurance. The Commissioner of Insurance may permit other specific practices that may deviate from prescribed practices and NAIC SAP. Statutory accounting principles that are established by state laws and permitted practices mandated by the Commissioner of Insurance may cause the statutory capital and surplus of the regulated subsidiaries to differ from that calculated under the NAIC SAP.

Prescribed statutory accounting practices in Puerto Rico allow TSP to disregard a deferred tax liability resulting from additions to the catastrophe loss reserve trust fund that would otherwise be required under NAIC SAP. The use of prescribed and permitted accounting practices, both individually and in the aggregate, did not change significantly the combined statutory capital and surplus that would have been reported following NAIC SAP, which as of December 31, 2016 and 2015 is approximately 1.3% and 1.1%, respectively, lower than the combined reported statutory capital and surplus.

The regulated subsidiaries are required by the NAIC and the Commissioner of Insurance to submit risk-based capital (RBC) reports following the NAIC’s RBC Model Act and accordingly, are subject to certain regulatory actions if their capital levels do not meet minimum specific RBC requirements.  RBC is a method developed by the NAIC to determine the minimum amount of statutory capital appropriate for an insurance company to support its overall business operations in consideration of its size and risk profile. The RBC is calculated by applying capital requirement factors to various assets, premiums and reserve items. The factor is higher for those items with greater underlying risk and lower for less risky items. The adequacy of an organization’s actual capital can then be measured by a comparison to its RBC as determined by the formula.

The RBC Model Act requires increasing degrees of regulatory oversight and intervention as an organization’s risk-based capital declines. The level of regulatory oversight ranges from requiring organizations to inform and obtain approval from the domiciliary insurance commissioner of a comprehensive financial plan for increasing its RBC, to mandatory regulatory intervention requiring an insurance company to be placed under regulatory control, in a rehabilitation or liquidation proceeding.

The Commissioner of Insurance adopted in 2009 an RBC policy that requires that the regulated entities maintain statutory reserves at or above the “Company Action Level,” in order to avoid regulatory monitoring and intervention. The Company action level is currently set at 200% of the RBC for the entities within our Managed Care segment and 300% of the RBC for entities within our Property and Casualty and Life Insurance segments. As of December 31, 2016 all regulated subsidiaries comply with minimum statutory reserve requirements, except for TSA for which we expect to remediate and implement corrective actions plans to comply with such requirements. As of December 31, 2015 all regulated subsidiaries comply with minimum statutory reserve requirements.

69

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following table sets forth the combined net admitted assets, capital and surplus, RBC requirement, which is our statutory capital and surplus requirement, and net income for the regulated subsidiaries at December 31, 2016, 2015 and 2014:

(dollar amounts in millions)	2016		2015		2014
Net admitted assets	$	1,829	$	1,881	$	1,734
Capital and surplus		638		691		659
RBC requirement		278		301		209
Net income		24		73		88

As more fully described in note 16, a portion of the accumulated earnings and admitted assets of TSP are restricted by the catastrophe loss reserve and the trust fund balance as required by the Insurance Code.  The total catastrophe loss reserve and trust fund amounted to $44,823 and $47,630 as of December 31, 2016, respectively. The total catastrophe loss reserve and trust fund amounted to $43,041 and $46,221 as of December 31, 2015, respectively.  In addition, the admitted assets of the regulated subsidiaries are restricted by the investments deposited with the Commissioner of Insurance to comply with requirements of the Insurance Code (see note 3).  Investments with an amortized cost of $5,358 and $5,136 (fair value of $5,788 and $5,276) at December 31, 2016 and 2015, respectively, were deposited with the Commissioner of Insurance. As a result, the combined restricted assets for our regulated subsidiaries were $52,988 and $51,357 as of December 31, 2016 and 2015, respectively.

70

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

25. Supplementary Information on Cash Flow Activities

	2016			2015			2014
Supplementary information
Noncash transactions affecting cash flow activities
Change in net unrealized (gain) loss on securities available for sale, including deferred income tax (asset)/liability of $1,085, $(5,717), and $4,717 in 2016, 2015, and 2014,respectively	$	107		$	38,989		$	(35,883	)
Change in liability for pension benefits, and deferred income tax (asset)/liability of $10,792, $10,124, $(12,298), in 2016, 2015, and 2014, respectively	$	(16,879	)	$	(15,836	)	$	19,236
Repurchase and retirement of common stock	$	(56	)	$	(182	)	$	(3,049	)
Exercise of stock options	$	55		$	179		$	2,885
Unsettled sales	$	-		$	-		$	10,456
Other
Income taxes paid	$	11,549		$	6,437		$	16,069
Interest paid	$	7,635		$	4,792		$	5,764

26. Segment Information

The operations of the Company are conducted principally through three reportable business segments: Managed Care, Life Insurance, and Property and Casualty Insurance.  Reportable business segments were identified according to the type of insurance products offered and consistent with the information provided to the chief operating decision maker. These segments and a description of their respective operations are as follows:

· Managed Care segment – This segment is engaged in the sale of managed care products to the Commercial, Medicare and Medicaid market sectors.  The Commercial accounts sector includes corporate accounts, U.S. federal government employees, individual accounts, local government employees, and Medicare supplement. The following represents a description of the major contracts by sector:

– The segment is a qualified contractor to provide health coverage to federal government employees within Puerto Rico. Earned premiums revenue related to this contract amounted to $163,556, $155,821, and $152,659 for the three-year period ended December 31, 2016, 2015, and 2014, respectively (see note 12).

– Under its commercial business, the segment also provides health coverage to certain employees of the Commonwealth of Puerto Rico and its instrumentalities. Earned premium revenue related to such health plans amounted to $29,475, $30,607, and $37,748 for the three-year period ended December 31, 2016, 2015, and 2014, respectively.

71

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

– The segment provides services through its Medicare health plans pursuant to a limited number of contracts with CMS. Earned premium revenue related to the Medicare business amounted to $1,023,904, $1,097,657, and $1,013,746 for the three-year period ended December 31, 2016, 2015, and 2014, respectively.

– The segment also participates in the Medicaid program to provide health coverage to medically indigent citizens in Puerto Rico, as defined by the laws of the government of Puerto Rico.  We served all eight service regions on an administrative service only basis (ASO) until March 31, 2015.  Administrative service fees for each of the years in the two-year period ended December 31, 2015, and 2014 amounted to $24,266, and $95,908, respectively.  Beginning on April 1, 2015, the segment began providing managed care services on a fully-insured basis, earned premium revenue related to this business amounted to $783,231, and $607,216 for the periods ended December 31, 2016, and 2015.

· Life Insurance segment – This segment offers primarily life and accident and health insurance coverage, and annuity products. The premiums for this segment are mainly subscribed through an internal sales force and a network of independent brokers and agents.

· Property and Casualty Insurance segment –The predominant insurance insurance products of this segment commercial package, commercial auto, and personal package. The premiums for this segment are originated through a network of independent insurance agents and brokers. Agents or general agencies collect the premiums from the insureds, which are subsequently remitted to the segment, net of commissions. Remittances are generally due 60 days after the closing date of the general agent’s account current.

The Company evaluates performance based primarily on the operating revenues and operating income of each segment.  Operating revenues include premiums earned (net), administrative service fees and net investment income.  Operating costs include claims incurred and operating expenses.  The Company calculates operating income or loss as operating revenues less operating costs.

The accounting policies for the segments are the same as those described in the summary of significant accounting policies included in the notes to consolidated financial statements.  The financial data of each segment is accounted for separately; therefore no segment allocation is necessary. However, certain operating expenses are centrally managed, therefore requiring an allocation to each segment. Most of these expenses are distributed to each segment based on different parameters, such as payroll hours, processed claims, or square footage, among others. In addition, some depreciable assets are kept by one segment, while allocating the depreciation expense to other segments. The allocation of the depreciation expense is based on the proportion of assets used by each segment. Certain expenses are not allocated to the segments and are kept within TSM’s operations.

72

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

The following tables summarize the operations by operating segment for each of the years in the three‑year period ended December 31, 2016:

	2016			2015			2014
Operating revenues
Managed care
Premiums earned, net	$	2,647,169		$	2,548,270		$	1,894,791
Fee revenue		17,843			44,705			119,302
Intersegment premiums/fee revenue		5,918			5,860			5,681
Net investment income		15,102			11,779			15,010
Total managed care		2,686,032			2,610,614			2,034,784
Life
Premiums earned, net		156,140			147,864			142,245
Intersegment premiums		716			251			240
Net investment income		24,877			24,457			23,717
Total life		181,733			172,572			166,202
Property and casualty
Premiums earned, net		87,332			87,020			91,530
Intersegment premiums		613			613			613
Net investment income		8,891			8,706			8,600
Total property and casualty		96,836			96,339			100,743
Other segments*
Intersegment service revenues		9,907			10,863			9,100
Operating revenues from external sources		3,563			3,875			4,234
Total other segments		13,470			14,738			13,334
Total business segments		2,978,071			2,894,263			2,315,063
TSM operating revenues from external sources		19			53			95
Elimination of intersegment premiums		(7,247	)		(6,724	)		(6,534	)
Elimination of intersegment service revenue		(9,907	)		(10,863	)		(9,100	)
Other intersegment eliminations		(78	)		23			116
Consolidated operating revenues	$	2,960,858		$	2,876,752		$	2,299,640

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

73

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2016			2015			2014
Operating (loss) income
Managed care	$	(36,777	)	$	20,514		$	31,445
Life		21,458			20,012			22,561
Property and casualty		12,074			8,273			10,044
Other segments*		(1,784	)		(301	)		(4,440	)
Total business segments		(5,029	)		48,498			59,610
TSM operating revenues from external sources		19			53			95
TSM unallocated operating expenses		(9,739	)		(18,858	)		(14,571	)
Elimination of TSM charges		9,522			9,623			9,717
Consolidated operating (loss) income		(5,227	)		39,316			54,851
Consolidated net realized investment gains		17,379			18,941			18,231
Consolidated interest expense		(7,635	)		(8,169	)		(9,274	)
Consolidated other income, net		6,569			7,043			2,243
Consolidated income before taxes	$	11,086		$	57,131		$	66,051

		2016		2015		2014
Depreciation and amortization expense
Managed care	$	11,114	$	13,268	$	17,935
Life		1,030		1,094		1,394
Property and casualty		544		673		994
Other segments*		645		556		3,264
Total business segments		13,333		15,591		23,587
TSM depreciation expense		787		788		813
Consolidated depreciation and amortization expense	$	14,120	$	16,379	$	24,400

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

74

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

	2016			2015			2014
Assets
Managed care	$	1,013,872		$	1,034,725		$	975,999
Life		816,920			770,721			764,268
Property and casualty		349,159			350,514			362,620
Other segments*		26,034			25,629			22,682
Total business segments		2,205,985			2,181,589			2,125,569
Unallocated amounts related to TSM
Cash, cash equivalents, and investments		17,033			12,304			44,157
Property and equipment, net		22,380			23,219			20,415
Other assets		21,646			31,732			37,851
		61,059			67,255			102,423
Elimination entries – intersegment receivables and others		(48,045	)		(42,699	)		(82,256	)
Consolidated total assets	$	2,218,999		$	2,206,145		$	2,145,736

		2016			2015			2014
Significant noncash items
Net change in unrealized gain (loss) on securities available for sale
Managed care	$	104		$	(15,505	)	$	6,055
Life		2,659			(13,005	)		22,349
Property and casualty		(2,984	)		(10,482	)		7,789
Other segments*		105			(10	)		-
Total business segments		(116	)		(39,002	)		36,193
Amount related to TSM		9			13			(310	)
Consolidated net change in unrealized gain (loss) on securities available for sale	$	(107	)	$	(38,989	)	$	35,883

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

75

Triple-S Management Corporation

Notes to Consolidated Financial Statements

December 31, 2016, 2015, and 2014

(dollar amounts in thousands, except per share and share data)

27. Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued.  No events, other than those described in these notes, have occurred that require adjustment or disclosure pursuant to current Accounting Standard Codification.

76

Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

(Registrant)

Balance Sheets

(in thousands)

	As of December 31,
	2016		2015
Assets:
Cash and cash equivalents	$	14,153	$	12,304
Securities available for sale, at fair value:
Equity Securities (cost of $2,869 in 2016)		2,880		-
Investment in subsidiaries		866,010		866,712
Notes receivable and accrued interest from subsidiaries		47,153		48,858
Due from subsidiaries		5,255		3,730
Deferred tax assets		14,976		26,767
Other assets		29,050		28,138
Total assets	$	979,477	$	986,509
Liabilities:
Notes payable and accrued interest to subsidiary		16,475		15,720
Due to subsidiaries		22,661		11,860
Long-term borrowings		35,085		36,827
Liability for pension benefits		30,892		62,945
Other liabilities		11,201		11,631
Total liabilities		116,314		138,983
Stockholders' equity:
Common stock, class A		951		951
Common stock, class B		23,321		24,048
Additional paid-in-capital		65,592		83,438
Retained earnings		730,904		713,466
Accumulated other comprehensive income, net		42,395		25,623
Total stockholders' equity		863,163		847,526
Total liabilities and stockholders' equity	$	979,477	$	986,509

The accompanying notes are an integral part of these condensed financial statements

77

Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

Triple-S Management Corporation

Statements of Earnings

(in thousands)

	2016			2015			2014
Investment income	$	19		$	53		$	95
Other revenues		11,644			12,015			11,034
Total revenues		11,663			12,068			11,129
Operating expenses:
General and administrative expenses		9,739			18,858			14,571
Interest expense		1,763			2,435			2,998
Total operating expenses		11,502			21,293			17,569
Income (loss) before income taxes		161			(9,225	)		(6,440	)
Income tax expense (benefit)		1,183			(1,071	)		(162	)
Loss of parent company		(1,022	)		(8,154	)		(6,278	)
Equity in net income of subsidiaries		18,460			60,275			71,938
Net income	$	17,438		$	52,121		$	65,660

The accompanying notes are an integral part of these condensed financial statements

78

Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

(Registrant)

Statements of Cash Flows

(in thousands)

	2016			2015			2014
Net income	$	17,438		$	52,121		$	65,660
Adjustment to reconcile net income to net cash provided by operating activities:
Equity in net income of subsidiaries		(18,460	)		(60,275	)		(71,938	)
Depreciation and amortization		839			872			863
Shared- based compensation		2,799			8,290			2,371
Deferred income tax expense (benefit)		1,042			(1,227	)		(137	)
Dividends received from subsidiaries		19,000			47,000			36,600
Other		-			42			34
Changes in assets and liabilities:
Accrued interest from subsidiaries, net		(646	)		(1,046	)		(1,614	)
Due from subsidiaries		(1,525	)		4,869			(2,831	)
Other assets		(1,751	)		(1,953	)		1,004
Due to subsidiaries		10,801			(2,162	)		5,654
Other liabilities		(4,812	)		4,614			(1,948	)
Net cash provided by operating activities		24,725			51,145			33,718
Cash flows from investing activities:
Acquisition of investment in securities classified as available for sale		(2,869	)		-			(27,572	)
Proceeds from sale and maturities of investment in securities classified as available for sale		-			27,500			28,016
Collection of note receivable from subsidiary		4,500			9,000			9,250
Issuance of note receivable to subsidiary		(1,394	)		(2,369	)		(13,131	)
Capital contribution to subsidiary		-			-			(908	)
Net acquisition of property and equipment		-			(3,676	)		-
Net cash provided by (used in) investing activities		237			30,455			(4,345	)
Cash flow from financing activities:
Repayments of long-term borrowings		(1,742	)		(37,640	)		(1,640	)
Repurchase of common stock		(21,371	)		(48,287	)		(11,337	)
Net cash used in financing activities		(23,113	)		(85,927	)		(12,977	)
Net increase (decrease) in cash and cash equivalents		1,849			(4,327	)		16,396
Cash and cash equivalents, beginning of year		12,304			16,631			235
Cash and cash equivalents, end of year	$	14,153		$	12,304		$	16,631

The accompanying notes are an integral part of these condensed financial statements

79

Triple-S Management Corporation(Parent Company Only)Notes to Condensed Financial Statements December 31, 2016, 2015 and 2014

(dollar amounts in thousands)

The accompanying notes to the condensed financial statements should be read in conjunction with the consolidated financial statements and the accompanying notes thereto included in Item 15 to the Annual Report on Form 10-K.

(1) For purposes of these condensed financial statements, Triple‑S Management Corporation’s (the Company or TSM) investment in its wholly owned subsidiaries is recorded using the equity method of accounting.

(2) Significant Accounting Policies

The significant accounting policies followed by the Company are set forth in the notes to the consolidated financial statements and the accompanying notes thereto.  Refer to Item 15 to the Annual Report on Form 10‑K.

(3) Long‑Term Borrowings

A summary of the long‑term borrowings entered into by the Company at December 31, 2016 and 2015 follows:

	2016		2015
Senior unsecured notes payable of $60,000 issued on
December 2005; due December 2020. Interest is payable monthly at a fixed rate of 6.60%.	$	24,000	$	24,000
Secured loan payable of $41,000, payable in monthly installments of $137 through July 1, 2024, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.23% at December 31, 2015.)		-		12,827
Secured loan payable of $11,187, payable in monthly installments of $137 through October 1, 2023, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.77% at December 31, 2016.)		11,187		-
Total borrowings		35,187		36,827
Less unamortized debt issuance costs		102		-
	$	35,085	$	36,827

80

Triple-S Management Corporation(Parent Company Only)Notes to Condensed Financial Statements December 31, 2016, 2015 and 2014

(dollar amounts in thousands)

Aggregate maturities of the Company’s long term borrowings as of December 31, 2016 are summarized as follows:

Year ending December 31
2017	$	1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
	$	35,187

All of the Company’s senior notes may be prepaid at par, in total or partially, five years after issuance as determined by the Company.  These senior unsecured notes contain certain non-financial covenants with which the Company has complied at December 31, 2016.

On December 28, 2016, TSM entered into a $35,500 credit agreement with a commercial bank in Puerto Rico. The agreement consists of three term loans: (i) Term Loan A in the principal amount of $11,187, (ii) Term Loan B in the principal amount of $20,150 and (iii) Term Loan C in the principal amount of $4,116. Term Loan A matures in October 2023 while the Term Loans B and C mature in January 2024.  Term Loan A was used to refinance the previous $41,000 secured loan payable with the same commercial bank in Puerto Rico.  Proceeds from Term Loans B and C were received on January 11, 2017 and were used to prepay the outstanding principal amount plus accrued interest of the 6.6% Senior Unsecured Notes due January 2021 ($24,000), and fund a portion of a debt service reserve for the Loan (approximately $200).  Pursuant to the credit agreement, interest is payable on the outstanding balance of the Loan at the following annual rate: (1) 1% over LIBOR for Term Loan A, (ii) 2.75% over LIBOR for Term Loan B, and (iii) 3.25% over LIBOR for Term Loan C.  Interest shall be payable commencing on January 1, 2017, in the case of Term Loan A, and on February 1, 2017, in the case of Term Loan B and Term Loan C.  The Credit Agreement includes certain financial and non-financial covenants, including negative covenants imposing certain restrictions on the Corporation’s business.  The Company was in compliance with all these covenants as of December 31, 2016.

The credit agreement is guaranteed by a first mortgage held by the bank on the Company’s land, building, and substantially all leasehold improvements, as collateral for the term of the loan under a continuing general security agreement.  This credit agreement contains certain non-financial covenants, which are customary for this type of facility, including but not limited to, restrictions on the granting of certain liens, limitations on acquisitions and limitations on changes in control and dividends.

The Company may, at its option, upon notice, as specified in the credit agreement, redeem and prepay prior to maturity, all or any part of the Loan and from time to time upon the payment of a penalty fee of 3% during the first year, 2% during the second year and 1% during the third year, and thereafter, at par, as specified in the credit agreement, together with accrued and unpaid interest, if any, to the date of redemption specified by the Company.

81

Triple-S Management Corporation(Parent Company Only)Notes to Condensed Financial Statements December 31, 2016, 2015 and 2014

(dollar amounts in thousands)

(4) Transactions with Related Parties

The following are the significant related parties transactions made for the three‑year period ended December 31, 2016, 2015 and 2014:

	2016		2015		2014
Rent charges to subsidiaries	$	7,801	$	7,801	$	7,801
Interest charged to subsidiaries on notes receivable		2,258		2,758		2,527
Interest charged from subsidiary on note payable		755		720		755

As of December 31, 2016 and 2015 the Company has three notes receivable from subsidiaries amounting to $30,750 and $35,250, respectively, pursuant to the provisions of Article 29.30 of the Puerto Rico Insurance Code. The notes receivable from subsidiaries are due on demand; however, pursuant to the requirements established by the Commissioner of Insurance, the parties agreed that no payment of the total principal nor the interest due on the loans will be made without first obtaining written authorization from the Commissioner of Insurance within at least 60 days prior to the proposed payment date. These notes bear interest at 4.7%.  Accrued interest at December 31, 2016 and 2015 amounted to $5,660 and $4,100, respectively.

In addition, as of December 31, 2016 and 2015, the Company has various notes receivable from a subsidiary amounting to $10,645 and $9,460, respectively.  Accrued interest at December 31, 2016 and 2015 amounted to $98 and $48, respectively.  These notes are due in different years, which due dates range from 2019 to 2020, and bear an average interest of 5.1%.

As of December 31, 2016 and 2015 the Company has a note payable to a subsidiary amounting to $15,000.  The note is due on December 31, 2017 and bears interest at 4.7%.  Accrued interest at December 31, 2016 and 2015 amounted to $1,475 and $720, respectively.

82

Triple-S Management Corporation and Subsidiaries

Schedule III - Supplementary Insurance Information

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)	Deferred																			Amortization of
	Policy																			Deferred Policy
	Acquisition					Liability for				Other										Acquisition
	Costs and Value					Future				Policy Claims					Net					Costs and Value		Other		Net
	of Business		Claim			Policy		Unearned		and Benefits		Premium			Investment		Claims			of Business		Operating		Premiums
Segment	Acquired		Liabilities			Benefits		Premiums		Payable		Revenue			Income		Incurred			Acquired		Expenses		Written
2016
Managed care	$	-	$	349,047		$	-	$	2,889	$	-	$	2,648,469		$	15,102	$	2,347,547		$	-	$	375,262	$	2,648,469
Life insurance		177,811		42,858			321,232		8,122		-		156,856			24,877		86,924			12,530		60,821		152,506
Property and casualty insurance		16,976		96,977			-		68,299		-		87,945			8,891		40,766			25,170		18,826		87,158
Other non-reportable segments, parent company operations and net consolidating entries.		-		(939	)		-		-		-		(2,629	)		43		(3,046	)		-		1,285		(2,629	)
											-
Total	$	194,787	$	487,943		$	321,232	$	79,310	$	-	$	2,890,641		$	48,913	$	2,472,191		$	37,700	$	456,194	$	2,885,504
2015
Managed care	$	-	$	348,297		$	-	$	3,489	$	-	$	2,549,522		$	11,779	$	2,196,693		$	-	$	393,407	$	2,549,173
Life insurance		172,284		44,601			352,370		6,596		-		148,115			24,457		82,561			17,661		52,338		144,262
Property and casualty insurance		18,364		99,796			-		70,175		-		87,633			8,706		42,600			25,933		19,533		85,734
Other non-reportable segments, parent company operations and net consolidating entries.		-		(929	)		-		-		-		(2,116	)		232		(3,139	)		-		9,849		(2,116	)
											-
Total	$	190,648	$	491,765		$	352,370	$	80,260	$	-	$	2,783,154		$	45,174	$	2,318,715		$	43,594	$	475,127	$	2,777,053
2014
Managed care	$	-	$	249,330		$	-	$	4,340	$	-	$	1,896,142		$	15,010	$	1,629,095		$	-	$	374,244	$	1,896,142
Life insurance		164,367		43,670			328,293		5,158		-		142,485			23,717		74,850			18,260		50,531		142,485
Property and casualty insurance		19,733		97,451			-		73,158		-		92,143			8,600		46,330			25,378		18,991		89,092
Other non-reportable segments, parent company operations and net consolidating entries.		-		(365	)		-		-		-		(2,204	)		213		(2,680	)		-		9,790		-
											-
Total	$	184,100	$	390,086		$	328,293	$	82,656	$	-	$	2,128,566		$	47,540	$	1,747,595		$	43,638	$	453,556	$	2,127,719

See accompanying independent registered public accounting firm’s report and notes to financial statements.

Triple-S Management Corporation and Subsidiaries

Schedule IV - Reinsurance

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)

									Percentage
			Ceded to		Assumed				of Amount
	Gross		Other		from Other		Net		Assumed
	Amount (1)		Companies		Companies		Amount		to Net
2016
Life insurance in force	$	10,178,956					$	10,178,956		0.0	%
Premiums:
Life insurance	$	160,628	$	8,838	$	4,350	$	156,140		2.8	%
Accident and health insurance		2,650,011		3,148		306		2,647,169		0.0	%
Property and casualty insurance		134,378		47,046		-		87,332		0.0	%
Total premiums	$	2,945,017	$	59,032	$	4,656	$	2,890,641		0.2	%
2015
Life insurance in force	$	10,129,123					$	10,129,123		0.0	%
Premiums:
Life insurance	$	153,607	$	9,596	$	3,853	$	147,864		2.6	%
Accident and health insurance		2,552,699		4,778		349		2,548,270		0.0	%
Property and casualty insurance		136,780		49,760		-		87,020		0.0	%
Total premiums	$	2,843,086	$	64,134	$	4,202	$	2,783,154		0.2	%
2014
Life insurance in force	$	9,739,048					$	9,739,048		0.0	%
Premiums:
Life insurance	$	152,573	$	10,328	$	-	$	142,245		0.0	%
Accident and health insurance		1,900,556		5,765		-		1,894,791		0.0	%
Property and casualty insurance		146,222		54,692		-		91,530		0.0	%
Total premiums	$	2,199,351	$	70,785	$	-	$	2,128,566		0.0	%

(1) Gross premiums amount is presented net of intercompany eliminations of $3,457,  $4,402 and $4,354 for the years ended December 31, 2016, 2015, and 2014, respectively.

See accompanying independent registered public accounting firm’s report and notes to financial statements.

Triple-S Management Corporation and Subsidiaries

Schedule V - Valuation and Qualifying Accounts

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)

			Additions
	Balance at		Charged to		Charged (Reversal)					Balance at
	Beginning of		Costs and		To Other Accounts		Deductions -			End of
	Period		Expenses		- Describe (1)		Describe (2)			Period
2016
Allowance for doubtful receivables	$	37,244		1,295		306		(1,538	)	$	37,307
2015
Allowance for doubtful receivables	$	36,368		15,781		340		(15,245	)	$	37,244
2014
Allowance for doubtful receivables	$	21,549		12,847		4,227		(2,255	)	$	36,368

(1) Represents premiums adjustment to provide for unresolved reconciliation items with the Government of Puerto Rico and other entities.

(2) Deductions represent the write-off of accounts deemed uncollectible.

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in Registration Statement Nos. 333-151032 and 333-217891 on Form S-8 of Triple-S Management Corporation of our report dated March 9, 2017, relating to the consolidated financial statements and financial statement schedules of Triple-S Management Corporation and its subsidiaries, and our report dated March 9, 2017 (August 9, 2017 as to the material weakness), relating to the effectiveness of  Triple-S Management Corporation's internal control over financial reporting (which report expresses an adverse opinion on the effectiveness of the Company's internal control over financial reporting because of a material weakness), appearing in this Form 10-K/A of Triple-S Management Corporation for the year ended December 31, 2016.

/s/ DELOITTE & TOUCHE LLP

San Juan, Puerto Rico

August 9, 2017

EX-23.2

 Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S‑8 (No. 333-151032 and 333-217891) of Triple-S Management Corporation of our report dated March 17, 2015 relating to the financial statements and financial statement schedules, which appears in this Form 10‑K/A.

San Juan, Puerto Rico

August 9, 2017

PricewaterhouseCoopers LLP, 254 Muñoz Rivera, Oriental Center, Suite 900, San Juan, PR 00918T: (787) 754 9090, F: (787) 766 1094, www.pwc.com/us

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Roberto García-Rodríguez, certify that:

1. I have reviewed this Annual Report on Form 10-K of Triple-S Management Corporation (“the registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 9, 2017	By:	/s/ Roberto García-Rodríguez
			Roberto García-Rodríguez
			President and Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Juan J. Román-Jiménez, certify that:

1. I have reviewed this Annual Report on Form 10-K of Triple-S Management Corporation (“the registrant”);

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a. Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b. Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c. Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d. Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a. All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b. Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:	August 9, 2017	By:	/s/ Juan J. Román-Jiménez
			Juan J. Román-Jiménez
			Executive Vice President and Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Triple-S Management Corporation (the “Company”) on Form 10-K for the period ended December 31, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Roberto García-Rodríguez, President and Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

a) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

b) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 9, 2017	By:	/s/ Roberto García-Rodríguez
			Roberto García-Rodríguez
			President and
			Chief Executive Officer

A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Triple-S Management Corporation (the “Company”) on Form 10-K for the period ended December 31, 2016 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Juan J. Román-Jiménez, Executive Vice President and Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

a) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

b) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	August 9, 2017	By:	/s/ Juan J. Román-Jiménez
			Juan J. Román-Jiménez
			Executive Vice President and
			Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Corporation and will be retained by the Corporation and furnished to the Securities and Exchange Commission or its staff upon request.

XML

Document and Entity Information - USD ($)	12 Months Ended
	Dec. 31, 2016	Feb. 28, 2017	Jun. 30, 2016
Entity Information [Line Items]
Entity Registrant Name	TRIPLE-S MANAGEMENT CORP
Entity Central Index Key	0001171662
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Document Fiscal Year Focus	2016
Document Fiscal Period Focus	FY
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2016
Common Class A [Member]
Entity Information [Line Items]
Entity Public Float			$ 950,968
Entity Common Stock, Shares Outstanding		950,968
Common Class B [Member]
Entity Information [Line Items]
Entity Public Float			$ 577,239,532
Entity Common Stock, Shares Outstanding		23,320,899

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Securities available for sale, at fair value:
Fixed maturities (amortized cost of $1,104,303 in 2016 and $1,088,258 in 2015)	$ 1,151,643	$ 1,133,645
Equity securities (cost of $240,699 in 2016 and $169,593 in 2015)	270,349	197,071
Securities held to maturity, at amortized cost:
Fixed maturities (fair value of $3,012 in 2016 and $3,124 in 2015)	2,836	2,929
Policy loans	8,564	7,901
Cash and cash equivalents	103,428	197,818
Total investments and cash	1,536,820	1,539,364
Premium and other receivables, net	286,365	282,646
Deferred policy acquisition costs and value of business acquired	194,787	190,648
Property and equipment, net	66,369	73,953
Deferred tax asset	57,768	52,361
Goodwill	25,397	25,397
Other assets	51,493	41,776
Total assets	2,218,999	2,206,145
Liabilities and Stockholders' Equity
Claim liabilities	487,943	491,765
Liability for future policy benefits	321,232	289,530
Unearned premiums	79,310	80,260
Policyholder deposits	179,382	179,287
Liability to Federal Employees' Health Benefits and Federal Employees' Programs	34,370	26,695
Accounts payable and accrued liabilities	169,449	176,910
Deferred tax liability	18,850	15,070
Long term borrowings	35,085	36,827
Liability for pension benefits	30,892	62,945
Total liabilities	1,356,513	1,359,289
Commitments and contingencies
Triple-S Management Corporation stockholders' equity
Additional paid-in capital	65,592	83,438
Retained earnings	730,904	713,466
Accumulated other comprehensive income, net	42,395	25,623
Total Triple-S Management Corporation stockholders' equity	863,163	847,526
Non-controlling interest in consolidated subsidiary	(677)	(670)
Total stockholders' equity	862,486	846,856
Total liabilities and stockholders' equity	2,218,999	2,206,145
Class A Common Stock [Member]
Triple-S Management Corporation stockholders' equity
Common stock	951	951
Class B Common Stock [Member]
Triple-S Management Corporation stockholders' equity
Common stock	$ 23,321	$ 24,048

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Securities available for sale, at fair value:
Fixed maturities, amortized cost	$ 1,104,303	$ 1,088,258
Equity securities, cost	240,699	169,593
Securities held to maturity, at amortized cost:
Fixed maturities, fair value	$ 3,012	$ 3,124
Class A Common Stock [Member]
Triple-S Management Corporation stockholders' equity
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	950,968	950,968
Common stock, outstanding (in shares)	950,968	950,968
Class B Common Stock [Member]
Triple-S Management Corporation stockholders' equity
Common stock, par value (in dollars per share)	$ 1	$ 1
Common stock, authorized (in shares)	100,000,000	100,000,000
Common stock, issued (in shares)	23,321,163	24,047,755
Common stock, outstanding (in shares)	23,321,163	24,047,755

XML

Consolidated Statements of Earnings - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Revenues:
Premiums earned, net	$ 2,890,641	$ 2,783,154	$ 2,128,566
Administrative service fees	17,843	44,705	119,302
Net investment income	48,913	45,174	47,540
Other operating revenues	3,461	3,719	4,232
Total operating revenues	2,960,858	2,876,752	2,299,640
Net realized investment gains (losses):
Total other-than-temporary impairment losses on securities	(1,434)	(5,212)	(1,170)
Net realized gains, excluding other-than-temporary impairment losses on securities	18,813	24,153	19,401
Total net realized investment gains on sale of securities	17,379	18,941	18,231
Other income, net	6,569	7,043	2,243
Total revenues	2,984,806	2,902,736	2,320,114
Benefits and expenses:
Claims incurred	2,472,191	2,318,715	1,747,595
Operating expenses	493,894	518,721	497,194
Total operating costs	2,966,085	2,837,436	2,244,789
Interest expense	7,635	8,169	9,274
Total benefits and expenses	2,973,720	2,845,605	2,254,063
Income (loss) before taxes	11,086	57,131	66,051
Income tax (benefit) expense	(6,345)	5,099	745
Net income	17,431	52,032	65,306
Less: Net loss attributable to non-controlling interest	7	89	354
Net income attributable to Triple-S Management Corporation	$ 17,438	$ 52,121	$ 65,660
Earnings per share attributable to Triple-S Management Corporation
Basic net income per share (in dollars per share)	$ 0.71	$ 2.03	$ 2.42
Diluted net income per share (in dollars per share)	$ 0.71	$ 2.02	$ 2.41

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Consolidated Statements of Comprehensive Income [Abstract]
Net income	$ 17,431	$ 52,032	$ 65,306
Other comprehensive income (loss), net of tax:
Net unrealized change in fair value of available for sale securities, net of taxes	(107)	(38,989)	35,883
Defined benefit pension plan:
Actuarial gain (loss), net	18,232	16,105	(18,967)
Prior service credit, net	(1,353)	(269)	(269)
Total other comprehensive income (loss), net of tax	16,772	(23,153)	16,647
Comprehensive income	34,203	28,879	81,953
Comprehensive loss attributable to non-controlling interest	7	89	354
Comprehensive income attributable to Triple-S Management Corporation	$ 34,210	$ 28,968	$ 82,307

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Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands	Common Stock [Member] Class A Common Stock [Member]	Common Stock [Member] Class B Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Triple-S Management Corporation [Member]	Noncontrolling Interest in Consolidated Subsidiary [Member]	Total
Balance at Dec. 31, 2013	$ 2,378	$ 25,091	$ 130,098	$ 595,685	$ 32,129	$ 785,381	$ (178)	$ 785,203
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation	0	135	2,236	0	0	2,371	0	2,371
Stock issued upon the exercise of stock options	0	199	2,686	0	0	2,885	0	2,885
Repurchase and retirement of common stock	0	(771)	(13,615)	0	0	(14,386)	0	(14,386)
Net change in comprehensive income (loss)	0	0	0	65,660	16,647	82,307	(354)	81,953
Balance at Dec. 31, 2014	2,378	24,654	121,405	661,345	48,776	858,558	(532)	858,026
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation	0	202	8,088	0	0	8,290	0	8,290
Stock issued upon the exercise of stock options	0	13	166	0	0	179	0	179
Common stock conversion	(1,427)	1,427	0	0	0	0	0	0
Repurchase and retirement of common stock	0	(2,248)	(46,221)	0	0	(48,469)	0	(48,469)
Non-controlling interest decrease related to retirement of consolidated subsidiary common stock	0	0	0	0	0	0	(49)	(49)
Net change in comprehensive income (loss)	0	0	0	52,121	(23,153)	28,968	(89)	28,879
Balance at Dec. 31, 2015	951	24,048	83,438	713,466	25,623	847,526	(670)	846,856
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Share-based compensation	0	223	2,576	0	0	2,799	0	2,799
Stock issued upon the exercise of stock options	0	4	51	0	0	55	0	55
Repurchase and retirement of common stock	0	(954)	(20,473)	0	0	(21,427)	0	(21,427)
Net change in comprehensive income (loss)	0	0	0	17,438	16,772	34,210	(7)	34,203
Balance at Dec. 31, 2016	$ 951	$ 23,321	$ 65,592	$ 730,904	$ 42,395	$ 863,163	$ (677)	$ 862,486

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash flows from operating activities
Net income	$ 17,431	$ 52,032	$ 65,306
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization	14,120	16,379	24,400
Net amortization of investments	8,671	6,854	6,091
Additions to the allowance for doubtful receivables	1,601	16,121	14,819
Deferred tax benefit	(8,326)	(5,070)	(21,806)
Net realized investment gain on sale of securities	(17,379)	(18,941)	(18,231)
Interest credited to policyholder deposits	3,794	5,690	3,510
Share-based compensation	2,463	8,290	2,371
(Increase) decrease in assets
Premium and other receivables, net	(5,320)	6,399	(45,046)
Deferred policy acquisition costs and value of business acquired	(7,286)	(6,548)	(6,811)
Deferred taxes	(4,799)	3,616	1,954
Other assets	(9,009)	(2,630)	8,630
(Decrease) increase in liabilities
Claim liabilities	(3,822)	101,679	(30,335)
Liability for future policy benefits	31,702	18,146	23,930
Unearned premiums	(950)	(2,396)	(4,706)
Liability to FEHBP	7,675	11,029	7,518
Accounts payable and accrued liabilities	(24,095)	18,444	6,397
Net cash provided by operating activities	6,471	229,094	37,991
Securities available for sale
Fixed maturities sold	400,848	355,045	235,282
Fixed maturities matured	56,988	67,615	31,329
Equity securities sold	109,049	100,152	113,942
Securities held to maturity
Fixed maturities matured	1,538	640	4,127
Other investments	0	0	8,925
Securities available for sale
Fixed maturities	(482,252)	(469,198)	(288,507)
Equity securities	(163,119)	(92,844)	(69,101)
Securities held to maturity
Fixed maturities	(1,445)	(624)	(935)
Other investments	(2,493)	(2,427)	(483)
Net disbursements for policy loans	(663)	(641)	(555)
Net capital expenditures	(4,750)	(9,094)	(4,783)
Net cash (used in) provided by investing activities	(86,299)	(51,376)	29,241
Cash flows from financing activities
Repurchase and retirement of common stock	(21,371)	(48,287)	(11,337)
Change in outstanding checks in excess of bank balances	12,250	(1,786)	(4,858)
Repayments of long-term borrowings	(1,742)	(37,640)	(14,835)
Proceeds from policyholder deposits	18,224	16,563	9,551
Surrenders of policyholder deposits	(21,923)	(18,787)	(10,072)
Net cash used in financing activities	(14,562)	(89,937)	(31,551)
Net (decrease) increase in cash and cash equivalents	(94,390)	87,781	35,681
Cash and cash equivalents
Beginning of year	197,818	110,037	74,356
End of year	$ 103,428	$ 197,818	$ 110,037

XML

Nature of Business

12 Months Ended

Dec. 31, 2016

Nature of Business [Abstract]

Nature of Business

1. Nature of Business

Triple-S Management Corporation (the Corporation, the Company or TSM) was incorporated under the laws of the Commonwealth of Puerto Rico to engage, among other things, as the holding company of entities primarily involved in the insurance industry.

The Company has the following wholly owned subsidiaries: (1) Triple-S Salud, Inc. (TSS) and Socios Mayores en Salud Holdings, Inc. (from now on referred to as Triple-S Advantage or TSA), managed care organizations that provide health benefits services to subscribers through contracts with hospitals, physicians, dentists, laboratories, and other organizations; (2) Triple-S Vida, Inc. (TSV) and Triple-S Blue, Inc. (TSB) (formerly known as Atlantic Southern Insurance Company (ASICO)), which are engaged in the underwriting of life and accident and health insurance policies and the administration of annuity contracts; and (3)  Triple-S Propiedad, Inc. (TSP), which is engaged in the underwriting of property and casualty insurance policies.  The Company, TSS and TSA are members of the Blue Cross and Blue Shield Association (BCBSA). The Company and the above mentioned subsidiaries are subject directly or indirectly to the regulations of the Commissioner of Insurance of the Commonwealth of Puerto Rico (the Commissioner of Insurance), the General Superintendence of Insurance of Costa Rica, the British Virgin Islands (BVI) Financial Services Commission, and the Anguilla Financial Services Commission

The Company also owns a controlling interest in a health clinic in Puerto Rico, as part of our strategic initiatives.  The clinic is a member of the Mayo Clinic network.

Through our subsidiary TSS, we provide services to participants of the Commonwealth of Puerto Rico Health Insurance Plan (similar to Medicaid) (Medicaid).  In 2011, TSS entered into a contract with an agency of Commonwealth of Puerto Rico (the government of Puerto Rico or the Commonwealth), the Administración de Servicios de Salud de Puerto Rico (ASES), to administer the provision of the physical health component of this program in five service regions in Puerto Rico on an Administrative Service Only (ASO) basis, under which TSS receives a monthly per-member, per-month administrative fee for its services and does not bear the insurance risk of the program.  On July 1, 2013, TSS amended its contract extending the administration of the provision of the physical health component of the Medicaid program for a 12-month period expiring on June 30, 2014. This amendment also transferred the administration of three additional regions to TSS upon completion of a transition period, which ended on October 1, 2013.  On June 30, 2014, the contract was extended for a nine-month period expiring March 31, 2015.  Effective April 1, 2015, the government changed the Medicaid delivery model from an ASO to a risk based model.  Under the risk based delivery model, TSS provides healthcare services to only two service regions.

The Company also has two other wholly owned subsidiaries, Interactive Systems, Inc. (ISI), and TSM International, LLC (TSM International).  ISI is mainly engaged in providing data processing services to the Company and its subsidiaries.  TSM International is an International Banking Entity, as licensed by the government of Puerto Rico, and currently has limited operations.

A substantial majority of the Company’s business activity is within Puerto Rico, and as such, the Company is subject to the risks associated with the Puerto Rico economy.

XML

Significant Accounting Policies

12 Months Ended

Dec. 31, 2016

Significant Accounting Policies [Abstract]

Significant Accounting Policies

2. Significant Accounting Policies

The following are the significant accounting policies followed by the Company and its subsidiaries:

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP).

The consolidated financial statements include the financial statements of the Company and its subsidiaries.  Intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period.  Actual results could differ from those estimates.

Cash Equivalents

The Company considers all highly liquid debt instruments with maturities of three months or less at the date of acquisition to be cash equivalents.  Cash equivalents of $24,486 and $113,040 at December 31, 2016 and 2015, respectively, consist principally of money market funds and certificates of deposit with original maturities of three months or less.

Investments

Investment in securities at December 31, 2016 and 2015 consists mainly of obligations of government‑sponsored enterprises, U.S. Treasury securities and obligations of U.S. government instrumentalities, obligations of the Commonwealth of Puerto Rico and its instrumentalities, municipal securities, corporate bonds, residential mortgage-backed securities, collateralized mortgage obligations, and equity securities.  The Company classifies its debt and equity securities in one of three categories: trading, available for sale, or held to maturity.  Trading securities are bought and held principally for the purpose of selling them in the near term.  Securities classified as held to maturity are those securities in which the Company has the ability and intent to hold the security until maturity.  All other securities not included in trading or held to maturity are classified as available for sale.

Trading and available-for-sale securities are recorded at fair value.  The fair values of debt securities (both available for sale and held to maturity investments) and equity securities are based on quoted market prices for those or similar investments at the reporting date.  Held-to-maturity debt securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums and discounts, respectively.  Unrealized holding gains and losses on trading securities are included in earnings.  Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized.  Realized gains and losses from the sale of available-for-sale securities are included in earnings and are determined on a specific‑identification basis.

Transfers of securities between categories are recorded at fair value at the date of transfer.  Unrealized holding gains and losses are recognized in earnings for transfers into trading securities.  Unrealized holding gains or losses associated with transfers of securities from held to maturity to available for sale are recorded as a separate component of other comprehensive income.  The unrealized holding gains or losses included in the separate component of other comprehensive income for securities transferred from available for sale to held to maturity, are maintained and amortized into earnings over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization or accretion of premium or discount on the associated security.

If a fixed maturity security is in an unrealized loss position and the Company has the intent to sell the fixed maturity security, or it is more likely than not that the Company will have to sell the fixed maturity security before recovery of its amortized cost basis, the decline in value is deemed to be other-than-temporary and is recorded to other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings.  For impaired fixed maturity securities that the Company does not intend to sell or it is more likely than not that such securities will not have to be sold, but the Company expects not to fully recover the amortized cost basis, the credit component of the other-than temporary impairment is recognized in other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings and the non-credit component of the other-than-temporary impairment is recognized in other comprehensive income.  Furthermore, unrealized losses entirely caused by non-credit related factors related to fixed maturity securities for which the Company expects to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive income.

The credit component of an other-than-temporary impairment is determined by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of acquisition.

The unrealized gains or losses on the Company’s equity securities classified as available-for-sale are included in accumulated other comprehensive income as a separate component of  stockholders’ equity, unless the decline in value is deemed to be other-than-temporary and the Company does not have the intent and ability to hold such equity securities until their full cost can be recovered, in which case such equity securities are written down to fair value and the loss is charged to other-than-temporary impairment losses recognized in earnings.

A decline in the fair value of any available-for-sale or held-to-maturity security below cost that is deemed to be other-than-temporary results in an impairment to reduce the carrying amount to fair value.  The impairment is charged to earnings and a new cost basis for the security is established.  To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary.  Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, market conditions, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in.

Premiums and discounts are amortized or accreted over the life of the related held-to-maturity or available-for-sale security as an adjustment to yield using the effective interest method.  Dividend and interest income are recognized when earned.

The Company regularly invests in mortgaged-backed securities and other securities subject to prepayment and call risk.  Significant changes in prevailing interest rates may adversely affect the timing and amount of cash flows on such securities.  In addition, the amortization of market premium and accretion of market discount for mortgaged-backed securities is based on historical experience and estimates of future payment speeds on the underlying mortgage loans.  Actual prepayment speeds may differ from original estimates and may result in material adjustments to amortization or accretion recorded in future periods.

Revenue Recognition

a. Managed Care

Subscriber premiums on the managed care business are billed in advance of their respective coverage period and the related revenue is recorded as earned during the coverage period.  Managed care premiums are billed in the month prior to the effective date of the policy with a grace period of up to two months.  If the insured fails to pay, the policy can be cancelled at the end of the grace period at the option of the Company.  Premiums for the Medicaid business are based on a bid contract with ASES and billed in advance of coverage period.  Under the risk-based Medicaid contract, there is an excess profit agreement which stipulates that the profit of TSS for each fiscal year of the contract term shall not exceed two and a half percentage (2.5%) of the fixed amount paid by ASES for each member.  In the event that the profit exceeds this amount, TSS and ASES shall share the excess profit in proportions of fifty percent (50%), subject to the compliance by TSS with certain quality metrics.  ASES retains the right to determine the outcome of the excess profit agreement that is based on audited financial statements of the contracted services submitted annually by TSS and the validation of the Incurred-But-Not-Reported (“IBNR”) reserve by ASES’s actuary.  We estimate the effect of the following arrangements on a monthly basis and reflect the adjustments to premium revenue in current operations.  We report any estimated net amounts due to ASES within accounts payable and accrued liabilities in the consolidated balance sheets. As the contract year progresses and additional information becomes available, any excess profit will be recorded in the operating results of the period in which the information becomes available.

Premiums for the Medicare Advantage (MA) business are based on a bid contract with the Centers for Medicare and Medicaid Services (CMS) and billed in advance of the coverage period.  MA contracts provide for a risk factor to adjust premiums paid for members that represent a higher or lower risk to the Company.  Retroactive rate adjustments are made periodically based on the aggregate health status and risk scores of the Company’s MA membership.  These risk adjustments are evaluated quarterly, based on actuarial estimates.  Actual results could differ from these estimates.  We recognize periodic changes to risk-adjusted premiums as revenue when the amounts are determinable and collections is reasonably assured, which is possible as additional diagnosis code information is reported to CMS, when the ultimate adjustments settlements are received from CMS, or we receive notification of such settlement amounts.  The data provided to CMS to determine member's risk scores is subject to audit by CMS even after the annual settlements occur, which may result in the refund of premiums to CMS. As additional information becomes available, the recorded estimate is revised and reflected in operating results in the period in which it becomes available.

Prescription drug coverage is offered to Medicare eligible beneficiaries as part of MA plans (MA-PD) and until 2014, on a stand-alone basis (stand-alone PDP).  Premiums are based on a bid contract with CMS that considers the estimated costs of providing prescription drug benefits to enrolled participants.  MA-PD and stand-alone PDP premiums are subject to adjustment, positive or negative, based upon the application of risk corridors that compare the estimated prescription drug costs included in the bids to CMS to actual prescription drug costs.  Variances exceeding certain thresholds may result in CMS making additional payments or in CMS requesting a refund for a portion of the premiums collected.  The Company estimates and records adjustments to earned premiums related to estimated risk corridor payments based upon actual prescription drug costs for each reporting period as if the annual contract were to end at the end of each reporting period.

Administrative service fees include revenue from certain groups which have managed care contracts that provide for the group to be at risk for all or a portion of their claims experience.  For these groups, the Company is not at risk and only handles the administration of managed care coverage for an administrative service fee.  The Company pays claims under commercial self-funded arrangements from its own funds, and subsequently receives reimbursement from these groups.  Until March 31, 2015, the claims related to the administration of the Medicaid business under the ASO delivery model were paid from a bank account owned and funded by the Government of Puerto Rico.  Claims paid under self-funded arrangements are excluded from the claims incurred in the accompanying consolidated financial statements.  Administrative service fees under the self-funded arrangements are recognized based on the group’s membership or incurred claims for the period multiplied by an administrative fee rate plus other fees.  In addition, some of these self-funded groups purchase aggregate and/or specific stop-loss coverage.  In exchange for a premium, the group’s aggregate liability or the group’s liability on any one episode of care is capped for the year.  Premiums for the stop-loss coverage are actuarially determined based on experience and other factors and are recorded as earned over the period of the contract in proportion to the coverage provided.  This fully insured portion of premiums is included within the premiums earned, net in the accompanying consolidated statements of earnings.  The Medicaid contract with the Government of Puerto Rico to administer the provision of the physical health component of this program contained a savings-sharing provision whereby the Government of Puerto Rico shared with TSS a portion of the medical cost savings obtained with the administration of the regions served on an administrative service basis.  Any savings-sharing amount was recorded when earned as administrative service fees in the accompanying consolidated statements of earnings.

b. Life and Accident and Health Insurance

Premiums on life insurance policies are billed in advance of their respective coverage period and the related revenue is recorded as earned when due.  Premiums on accident and health and other short‑term policies are recognized as earned primarily on a pro rata basis over the contract period.  Premiums on credit life policies are recognized as earned in proportion to the amounts of insurance in‑force.  Revenues from universal life and interest sensitive policies represent amounts assessed against policyholders, including mortality charges, surrender charges actually paid, and earned policy service fees.  The revenues for limited payment contracts are recognized over the period that benefits are provided rather than on collection of premiums.

c. Property and Casualty Insurance

Premiums on property and casualty contracts are billed in advance of their respective coverage period and they are recognized as earned on a pro rata basis over the policy term.  The portion of premiums related to the period prior to the end of coverage is recorded in the consolidated balance sheets as unearned premiums and is transferred to premium revenue as earned.

Allowance for Doubtful Receivables

The allowance for doubtful receivables is based on management’s evaluation of the aging of accounts and such other factors which deserve current recognition, including the continued deterioration of the local economy, the exposure to government accounts, and the challenging business environment in the island.  This evaluation is performed individually on larger accounts and includes the use of all available information such as the customer’s credit worthiness and other relevant information.  Actual losses could differ from these estimates.  Receivables are charged-off against their respective allowance accounts when deemed to be uncollectible.

Deferred Policy Acquisition Costs and Value of Business Acquired

Certain direct costs for acquiring successful life and accident and health, and property and casualty insurance segment are deferred by the Company.  Substantially all acquisition costs related to the managed care segment are expensed as incurred.

In the life and accident and health segment deferred acquisition costs consist of commissions and certain expenses related to the production of life, annuity, accident and health, and credit business.  In the event that future premiums, in combination with policyholder reserves and anticipated investment income, could not provide for all future maintenance and settlement expenses, the amount of deferred policy acquisition costs would be reduced to provide for such amount.  The related amortization is provided over the anticipated premium-paying period of the related policies in proportion to the ratio of annual premium revenue to expected total premium revenue to be received over the life of the policies.  Interest is considered in the amortization of deferred policy acquisition cost and value of business acquired.  For these contracts interest is considered at a level rate at the time of issue of each contract, 5.15% for 2016, from 4.50% to 4.90% for 2015 and 4.90% for 2014, and, in the case of the value of business acquired, at the time of any acquisition.

For certain other long-duration contracts, deferred amounts are amortized at historical and forecasted credited interest rates.  Expected premium revenue is estimated by using the same mortality and withdrawal assumptions used in computing liabilities for future policy benefits.  The method followed in computing deferred policy acquisition costs limits the amount of such deferred costs to their estimated net realizable value.  In determining estimated net realizable value, the computations give effect to the premiums to be earned, related investment income, losses and loss-adjustment expenses, and certain other costs expected to be incurred as the premium is earned.

Costs deferred on universal life and interest sensitive products are amortized as a level percentage of the present value of anticipated gross profits from investment yields, mortality, expenses and surrender charges.  Estimates used are based on the Company’s experience as adjusted to provide for possible adverse deviations.  These estimates are periodically reviewed and compared with actual experience.  When it is determined that future expected experience differs significantly from that assumed, the estimates are updated for current and future issues which may result in a change or release of deferred policy acquisition costs amortization through the consolidated statement of earnings.

The value assigned to the life insurance in-force at the date of the acquisition is amortized using methods similar to those used to amortize the deferred policy acquisition costs of the life and accident and health segment.

In the property and casualty segment, acquisition costs consist of commissions incurred during the production of business and are deferred and amortized ratably over the terms of the policies.

Property and Equipment

Property and equipment are stated at cost.  Maintenance and repairs are expensed as incurred.  Depreciation is calculated on the straight-line method over the estimated useful lives of the assets.  Costs of computer equipment, programs, systems, installations, and enhancements are capitalized and amortized straight-line over their estimated useful lives.  The following is a summary of the estimated useful lives of the Company’s property and equipment:

Asset Category	Estimated Useful Life
Buildings	20 to 50 years
Building improvements	3 to 5 years
Leasehold improvements	Shorter of estimated useful
Office furniture	life or lease term 5 years
Computer software	3 to 10 years
Computer equipment, equipment, and automobiles	3 years

Long-Lived Assets, including Goodwill

Long‑lived assets, such as property and equipment, and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset.  If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.  Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated.  The assets and liabilities of a disposal group classified as held for sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheets.

During 2014, the Company identified events that indicated that the carrying amount of the intangible assets purchased as part of the health clinic acquisition may not be recoverable.  As such, the Company performed an impairment analysis on those intangible assets and based on the results of the test, an impairment charge of $2,221 was recorded caused by the carrying value being greater than its fair value.  After the impairment charge, which is included within the consolidated operating expenses, there is no remaining carrying value of the acquired intangible assets as of December 31, 2014 related to the health clinic acquisition.  During 2016 and 2015, impairment tests on the remaining intangible assets were performed and based on the results of the tests no impairment was recorded.

Goodwill and intangible assets that have indefinite useful lives are tested at least annually for impairment, and are tested for impairment more frequently if events and circumstances indicate that the asset might be impaired.  An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value.  For goodwill, the impairment determination is made at the reporting unit level.  The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step goodwill impairment test.  The Company assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill.  If determined to be necessary, the two-step impairment test is used to identify potential goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any).   First, the Company determines the fair value of a reporting unit and compares it to its carrying amount.  Second, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill.  The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation.  The residual fair value after this allocation is the implied fair value of the reporting unit goodwill.

The annual impairment test is based on an evaluation of estimated future discounted cash flows.  The estimated discounted cash flows are based on the best information available, including supportable assumptions and projections we believe are reasonable. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view. The discount rates are consistent with those used for investment decisions and take into account the operating plans and strategies of our operating segments. Certain other key assumptions utilized, including changes in membership, premium, health care costs, operating expenses, fees, assessments and taxes and effective tax rates, are based on estimates consistent with those utilized in our annual budgeting and planning process that we believe are reasonable. However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion of our goodwill, which would adversely affect our operating results in the period of impairment. Impairments, if any, would be classified as an operating expense.

Claim Liabilities

Claim liabilities for managed care policies represent the estimated amounts to be paid to providers based on experience and accumulated statistical data.  Loss-adjustment expenses related to such claims are currently accrued based on estimated future expenses necessary to process such claims. Managed care claim liabilities also include a provision for adverse deviation, which is an estimate for known environmental factors that are reasonably likely to affect the required level of reserves. This provision for adverse deviation is intended to capture the potential adverse development from known environmental factors such as our entry into new geographical markets, changes in our geographic or product mix, the introduction of new customer populations, variation in benefit utilization, disease outbreaks, changes in provider reimbursement, fluctuations in medical cost trend, variation in claim submission patterns and variation in claims processing speed and payment patterns, changes in technology that provide faster access to claims data or change the speed of adjudication and settlement of claims, variability in claim inventory levels, non-standard claim development, and/or exceptional situations that require judgmental adjustments in setting the reserves for claims.

The Company contracts with various independent practice associations (IPAs) for certain medical care services provided to some policies subscribers.  The IPAs are compensated on a capitation basis and capitation payables are included in claim liabilities.

Claim liabilities include unpaid claims and loss-adjustment expenses of the life and accident and health segment based on a case-basis estimate for reported claims, and on estimates, based on experience, for unreported claims and loss-adjustment expenses.  The liability for policy and contract claims and claims expenses has been established to cover the estimated net cost of insured claims.

Also included within the claim liabilities is the liability for losses and loss-adjustment expenses for the property and casualty segment which represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expenses for investigating and settling claims.

Claim liabilities are necessarily based on estimates and, while management believes that the amounts are adequate, the ultimate liability may be in excess of or less than the amounts provided.  The methods for making such estimates and for establishing the resulting liability are continually reviewed, and any adjustments are reflected in the consolidated statements of earnings in the period determined.

Future Policy Benefits

The liability for future policy benefits has been computed using the level‑premium method based on estimated future investment yield, mortality, morbidity and withdrawal experience.  The assumptions are established at the time the policy is issued and are generally not changed during the life of the policy.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required. The interest rate assumption ranges between 3.90% and 5.75% for all years in issue.

Mortality has been calculated principally on select and ultimate tables in common usage in the industry.  Withdrawals have been estimated principally based on industry tables, modified by Company’s experience.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required.

Policyholder Deposits

Amounts received for annuity contracts are considered deposits and recorded as a liability along with the accrued interest and reduced for charges and withdrawals.  Interest incurred on such deposits, which amounted to $3,182, $3,379, and $3,510, during the years ended December 31, 2016, 2015, and 2014, respectively, is included within the interest expense in the accompanying consolidated statements of earnings.

Policyholder account balances for universal life and interest sensitive products are equal to policy account values. The policy account primarily comprises cumulative deposits received and interest credited to the policyholder less cumulative contract benefits, surrenders, withdrawals, maturities and contract charges for mortality or administrative expenses.  Interest rates credited to policyholder account balances during 2016 range from 1.25% to 4.5%, and during 2015 range from 2.0% to 4.5% for universal life and interest sensitive products.  The universal life and interest sensitive products represented $69,445 and $62,840 of the policyholder deposits balance on the consolidated balance sheets as of December 31, 2016 and 2015, respectively.

Reinsurance

In the normal course of business, the insurance-related subsidiaries seek to limit their exposure that may arise from catastrophes or other events that cause unfavorable underwriting results by reinsuring certain levels of risk in various areas of exposure with other insurance enterprises or reinsurers.

Reinsurance premiums, commissions, and expense reimbursements, related to reinsured business are accounted for on bases consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.  Accordingly, reinsurance premiums are reported as prepaid reinsurance premiums and amortized over the remaining contract period in proportion to the amount of insurance protection provided.

Premiums ceded and recoveries of losses and loss-adjustment expenses have been reported as a reduction of premiums earned and losses and loss-adjustment expenses incurred, respectively.  Property and casualty commission and expense allowances received in connection with reinsurance ceded have been accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly.  Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured policy.

Income Taxes

Income taxes are accounted for under the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of earnings in the period that includes the enactment date.  The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.  Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized.  Changes in recognition or measurement are reflected in the period in which the change in circumstances occurs.

The Company records any interest and penalties related to unrecognized tax benefits within the operating expenses in the consolidated statement of earnings.

The holding company within the TSA group of companies is a U.S.-based company that has not recorded a U.S. deferred tax liability for the excess of the book basis over the tax basis of its investments in Puerto Rico corporations.  TSA has not recorded a deferred tax liability to the extent that the basis difference results from outside basis difference created as a result of the business combination and earnings that meet the indefinite reversal criteria. The indefinite reversal criteria is met if the Puerto Rico subsidiary has invested, or will invest, the undistributed earnings indefinitely. The decision as to the amount of undistributed earnings intended to be maintained in Puerto Rico corporations takes into account several items including, but not limited to, actual results of operations, forecasts and budgets of financial needs of cash for working capital, liquidity plans, capital improvement programs, merger and acquisition plans as well as expected cash requirements in the U.S. or in other Puerto Rico subsidiaries from the U.S.-based company.

Health Insurance Providers Fee

The Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (ACA) mandates an annual Health Insurance Providers Fee (HIP Fee).  The annual HIP Fee, which was effective January 1, 2014, becomes payable to the U.S. Treasury once the entity provides health insurance for any U.S. health risk each applicable calendar year.  The initial estimated annual fee is accrued as of January 1, with a corresponding deferred cost that is amortized over 12 months on a straight line basis. The fee payment is due on September 30 of each year. The Company incurred approximately $44,100, $34,500 and $27,700 of such fees in 2016, 2015 and 2014, respectively, which are presented within the consolidated operating expenses.

Insurance-Related Assessments

The Company records a liability for insurance-related assessments when the following three conditions are met: (1) the assessment has been imposed or the information available prior to the issuance of the financial statements indicates it is probable that an assessment will be imposed; (2) the event obligating an entity to pay (underlying cause of) an imposed or probable assessment has occurred on or before the date of the financial statements; and (3) the amount of the assessment can be reasonably estimated.  A related asset is recognized when the paid or accrued assessment is recoverable through either premium taxes or policy surcharges.

Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated.  Legal costs incurred in connection with loss contingencies are expensed as incurred.  Recoveries of costs from third parties, which are probable of realization, are separately recorded as assets, and are not offset against the related liability.

Share‑Based Compensation

Share-based compensation is measured at the fair value of the award and recognized as an expense in the financial statements over the vesting period.

Earnings Per Share

Basic earnings per share excludes dilution and is computed by dividing net income available to all classes of common stockholders by the weighted average number of all classes of common shares outstanding for the period, excluding non-vested restricted stocks.  Diluted earnings per share is computed in the same manner as basic earnings per share except that the number of shares is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued.  Dilutive common shares are included in the diluted earnings per share calculation using the treasury stock method.

Recently Issued Accounting Standards

On January 5, 2016, the FASB issued guidance to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information.  Among the many targeted improvements to U.S. GAAP are (1) requiring equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income; (2) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; and (4) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.  This guidance applies to all entities that hold financial assets or owe financial liabilities. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

On February 25, 2016, the FASB issued guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and by disclosing key information about leasing arrangements.  This guidance sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessors and lessees. It requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The guidance requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. Companies are required to adopt the new guidance using a modified retrospective approach for annual and interim periods beginning after December 31, 2018.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

On March 30, 2016, the FASB issued guidance to reduce complexity in accounting standards.  The areas for simplification involve several aspects of the accounting for share-based payment transactions, including (1) accounting for income taxes, (2) classification of excess tax benefits on the statement of cash flow, (3) forfeitures; (4) minimum statutory tax withholding requirements, (5) classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax withholding purposes:, (6) the practical expedient for estimating the expected term, and (7) intrinsic value.  The guidance related to when excess tax benefits are recognized will be adopted through a modified retrospective approach by means of a cumulative-effect adjustment to equity as of January 1, 2017.  The provisions related to the recognition of excess tax benefits in the income statements and classification in the statement of cash flows will be adopted prospectively.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On May 9, 2016, the FASB issued guidance which affects only the narrow aspects of guidance related to revenue from contracts with customers that include: (1) clarification of the collectibility criterion and the addition of a new criterion to clarify when revenue would be recognized for a contract that fails to meet the criteria in step 1 of the core principle of the guidance (i.e., identifying the contracts with a customer); (2) presentation of sales taxes and similar taxes collected from customers; (3) non-cash consideration; (4) contract modifications at transition; (5) completed contracts at transition; and (6) clarification that an entity that retrospectively applies in the guidance to each prior reporting period is not required to disclose the effect of the accounting change for the period of adoption, but is still required to disclose the effect of the changes on any prior periods retrospectively adjusted. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  As the majority of the Company’s revenues are not subject to the new guidance, the adoption of this guidance should not have a material impact on the Company’s consolidated financial position, result of operations, equity or cash flows. We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On June 16, 2016, the FASB issued guidance to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date by replacing the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On August 26, 2016, the FASB issued guidance to addresses stakeholders’ concerns regarding diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under, Statement of Cash Flows, and other Topics.  In particular, the guidance addresses eight specific cash flow issues in an effort to reduce this diversity in practice: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On December 14, 2016, the FASB issued guidance that amended the Master Glossary of the Accounting Standards Codification (ASC), including simplification and minor improvements to Codification topics and subtopics regarding insurance and troubled debt restructuring that result in numerous editorial changes to the Codification, but are not expected to affect current accounting practice or result in any significant costs.  However, there are six amendments that clarify guidance or correct references in the Codification, and could potentially result in changes in current practice because of either misapplication or misunderstanding of current guidance, including amendments to (1) Property, Plant, and Equipment—Real Estate Sales; (2) Fair Value Measurement; (3) Transfers and Servicing —Sales of Financial Assets; (4) Liabilities—Obligations Resulting from Joint and Several Liability Arrangements; (5) Transfers and Servicing—Servicing Assets and Liabilities; and (6) Intangibles—Goodwill and Other— Internal-Use Software.  The transition guidance for the first five amendments must be applied prospectively because they could potentially involve the use of hindsight that includes fair value measurements.  Other than as indicated above, the amendments in this guidance are effective upon issuance for both public entities and nonpublic entities.  The Company adopted this guidance upon issuance with no impact on our financial position and results of operations.

Other than the accounting pronouncements disclosed above, there were no other new accounting pronouncements issued that could have a material impact in the Company’s financial position, operating results or financials statement disclosures.

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Investment in Securities

12 Months Ended

Dec. 31, 2016

Investment in Securities [Abstract]

Investment in Securities

3. Investment in Securities

The amortized cost for debt securities and cost for equity securities, gross unrealized gains, gross unrealized losses, and estimated fair value for available-for-sale and held-to-maturity securities by major security type and class of security at December 31, 2016 and 2015, were as follows:

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	41,442	$	87	$	(15	)	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,652		157		(9	)		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		17,930		2,189		(68	)		20,051
Municipal securities		650,175		34,187		(559	)		683,803
Corporate bonds		263,351		12,182		(661	)		274,872
Residential mortgage-backed securities		684		34		-			718
Collateralized mortgage obligations		45,069		58		(242	)		44,885
Total fixed maturities		1,104,303		48,894		(1,554	)		1,151,643
Equity securities-Mutual funds		240,699		30,101		(451	)		270,349
Total	$	1,345,002	$	78,995	$	(2,005	)	$	1,421,992

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	115,965	$	301	$	(26	)	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,322		234		(286	)		163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		25,302		317		-			25,619
Municipal securities		612,225		35,418		(197	)		647,446
Corporate bonds		148,198		9,782		(572	)		157,408
Residential mortgage-backed securities		883		54		-			937
Collateralized mortgage obligations		22,363		368		(6	)		22,725
Total fixed maturities		1,088,258		46,474		(1,087	)		1,133,645
Equity securities-Mutual funds		169,593		27,851		(373	)		197,071
Total	$	1,257,851	$	74,325	$	(1,460	)	$	1,330,716

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	619	$	158	$	-	$	777
Residential mortgage-backed securities		191		18		-		209
Certificates of deposits		2,026		-		-		2,026
	$	2,836	$	176	$	-	$	3,012

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	620	$	178	$	-	$	798
Residential mortgage-backed securities		191		17		-		208
Certificates of deposits		2,118		-		-		2,118
	$	2,929	$	195	$	-	$	3,124

Gross unrealized losses on investment securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2016 and 2015 were as follows:

	2016
	Less than 12 months							12 months or longer							Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	9,483	$	(15	)		1	$	-	$	-			-	$	9,483	$	(15	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		12,937		(9	)		1		-		-			-		12,937		(9	)		1
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		7,758		(68	)		5		-		-			-		7,758		(68	)		5
Municipal securities		84,252		(559	)		13		-		-			-		84,252		(559	)		13
Corporate bonds		105,054		(661	)		22		-		-			-		105,054		(661	)		22
Collateralized mortgage obligations		32,120		(239	)		8		784		(3	)		1		32,904		(242	)		9
Total fixed maturities		251,604		(1,551	)		50		784		(3	)		1		252,388		(1,554	)		51
Equity securities-Mutual funds		22,615		(451	)		4		-		-			-		22,615		(451	)		4
Total for securities available for sale	$	274,219	$	(2,002	)		54	$	784	$	(3	)		1	$	275,003	$	(2,005	)		55

	2015
	Less than 12 months							12 months or longer						Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss		Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	18,989	$	(26	)		1	$	-	$	-		-	$	18,989	$	(26	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		130,996		(286	)		5		-		-		-		130,996		(286	)		5
Municipal securities		43,937		(197	)		11		-		-		-		43,937		(197	)		11
Corporate bonds		35,718		(572	)		9		-		-		-		35,718		(572	)		9
Collateralized mortgage obligations		1,448		(6	)		1		-		-		-		1,448		(6	)		1
Total fixed maturities		231,088		(1,087	)		27		-		-		-		231,088		(1,087	)		27
Equity securities-Mutual funds		9,319		(373	)		2		-		-		-		9,319		(373	)		2
Total for securities available for sale	$	240,407	$	(1,460	)		29	$	-	$	-		-	$	240,407	$	(1,460	)		29

The Corporation regularly monitors and evaluates the difference between the amortized cost and estimated fair value of investments.  For investments with a fair value below amortized cost, the process includes evaluating: (1) the length of time and the extent to which the estimated fair value has been less than amortized cost for fixed maturity securities, or cost for equity securities, (2) the financial condition, near-term and long-term prospects for the issuer, including relevant industry conditions and trends, and implications of rating agency actions, (3) the Company’s intent to sell or the likelihood of a required sale prior to recovery, (4) the recoverability of principal and interest for fixed maturity securities, or cost for equity securities, and (5) other factors, as applicable.  This process is not exact and requires further consideration of risks such as credit and interest rate risks.  Consequently, if an investment’s cost exceeds its estimated fair value solely due to changes in interest rates, other-than temporary impairment may not be appropriate.

Due to the subjective nature of the Corporation’s analysis, along with the judgment that must be applied in the analysis, it is possible that the Corporation could reach a different conclusion whether or not to impair a security if it had access to additional information about the investee.  Additionally, it is possible that the investee’s ability to meet future contractual obligations may be different than what the Corporation determined during its analysis, which may lead to a different impairment conclusion in future periods.

If after monitoring and analyzing impaired securities, the Corporation determines that a decline in the estimated fair value of any available-for-sale or held-to-maturity security below cost is other-than-temporary, the carrying amount of the security is reduced to its fair value in accordance with current accounting guidance.  The new cost basis of an impaired security is not adjusted for subsequent increases in estimated fair value.  In periods subsequent to the recognition of an other-than-temporary impairment, the impaired security is accounted for as if it had been purchased on the measurement date of the impairment.  For debt securities, the discount (or reduced premium) based on the new cost basis may be accreted into net investment income in future periods based on prospective changes in cash flow estimates, to reflect adjustments to the effective yield.

The Corporation’s process for identifying and reviewing invested assets for other-than temporary impairments during any quarter includes the following:

• Identification and evaluation of securities that have possible indications of other-than-temporary impairment, which includes an analysis of all investments with gross unrealized investment losses that represent 20% or more of their cost and all investments with an unrealized loss greater than $100.

• For any other securities with a gross unrealized investment loss we might review and evaluate investee’s current financial condition, liquidity, near-term recovery prospects, implications of rating agency actions, the outlook for the business sectors in which the investee operates and other factors.

• Consideration of evidential matter, including an evaluation of factors or triggers that may or may not cause individual investments to qualify as having other-than-temporary impairments.

• Determination of the status of each analyzed security as other-than-temporary or not, with documentation of the rationale for the decision; and

• Equity securities are considered to be impaired based on market conditions and the length of time the funds have been in a loss position.

The Corporation reviews the investment portfolios under the Corporation’s impairment review policy.  Given market conditions and the significant judgments involved, there is a continuing risk that declines in fair value may occur and material other-than-temporary impairments may be recorded in future periods.  The Corporation from time to time may sell investments as part of its asset/liability management process or to reposition its investment portfolio based on current and expected market conditions.

Obligations of Government-Sponsored Enterprises, Obligations of U.S. Government Instrumentalities and Municipal Securities:  The unrealized losses on the Corporation’s investments in obligations of Government Sponsored Enterprises, U.S. Government Instrumentalities, and Municipal Securities were mainly caused by fluctuations in interest rates and general market conditions.  The contractual terms of these investments do not permit the issuer to settle the securities at a price less than the par value of the investment.  In addition, these investments have investment grade ratings. Because the decline in fair value is attributable to changes in interest rates and not credit quality; because the Corporation does not intend to sell the investments and it is not more likely than not that the Corporation will be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Corporation expects to collect all contractual cash flows, these investments are not considered other-than-temporarily impaired.

Corporate Bonds:  The unrealized losses of these bonds were principally caused by fluctuations in interest rates and general market conditions.  All corporate bonds with an unrealized loss have investment grade ratings.  Because the decline in estimated fair value is principally attributable to changes in interest rates; because the Company does not intend to sell the investments and it is not more likely than not that the Company will be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Company expects to collect all contractual cash flows, these investments are not considered other-than-temporarily impaired.

Collateralized mortgage obligations:  The unrealized losses on investments in collateralized mortgage obligations (“CMOs”) were mostly caused by fluctuations in interest rates and credit spreads.  The contractual cash flows of these securities, other than private CMOs, are guaranteed by a U.S. government-sponsored enterprise.  Any loss in these securities is determined according to the seniority level of each tranche, with the least senior (or most junior), typically the unrated residual tranche, taking any initial loss. The investment grade credit rating of our securities reflects the seniority of the securities that the Corporation owns.  The Corporation does not consider these investments other-than-temporarily impaired because the decline in fair value is attributable to changes in interest rates and not credit quality; the Corporation does not intend to sell the investments and it is more likely than not that the Corporation will not be required to sell the investments before recovery of their amortized cost basis, which may be maturity; and because the Corporation expects to collect all contractual cash flows.

Mutual Funds:As of December 31, 2016, investments in mutual funds with unrealized losses are not considered other-than-temporarily impaired based on market conditions and the length of time the funds have been in a loss position.  During the years ended December 31, 2016 and 2015, positions with a total fair market value of $11,582 and $13,189 were impaired by $1,434 and $945, respectively.  There were no impairment on mutual funds during the year 2014.

Obligations of the Commonwealth of Puerto Rico and its Instrumentalities: Our holdings in Puerto Rico municipals can be divided in (1) escrowed bonds with a fair value of $7,758 and a gross unrealized loss of $68, and (2) bonds issued by the Puerto Rico Sales Tax Financing Corporation (Cofina) with a fair value of $12,293 and a gross unrealized gain of $2,189.

As of December 31, 2016, investments in escrowed bonds are not considered other-than-temporarily impaired based on the length of time the funds have been in a loss position, the decline in estimated fair value is principally attributable to changes in interest rates, and the fact that these bonds are backed by US Government securities, and therefore have an implicit AA+/Aaa rating.

Besides holdings in escrowed bonds, our exposure is in senior liens bonds issued by Cofina, which were not impaired during the year ended December 31, 2016.  During the years ended December 31, 2015 and 2014, impairments on Cofina bonds amounted to $4,267 and $1,170, respectively.

Maturities of investment securities classified as available for sale and held to maturity at December 31, 2016 were as follows:

	Amortized Cost		Estimated Fair Value
Securities available for sale
Due in one year or less	$	11,010	$	11,116
Due after one year through five years		343,904		347,140
Due after five years through ten years		144,748		152,225
Due after ten years		558,888		595,559
Residential mortgage-backed securities		684		718
Collateralized mortgage obligations		45,069		44,885
	$	1,104,303	$	1,151,643
Securities held to maturity
Due in one year or less	$	2,026	$	2,026
Due after ten years		619		777
Residential mortgage-backed securities		191		209
	$	2,836	$	3,012

Expected maturities may differ from contractual maturities because some issuers have the right to call or prepay obligations with or without call or prepayment penalties.

Investments with an amortized cost of $5,358 and $5,136 (fair value of $5,788 and $5,276) at December 31, 2016 and 2015, respectively, were deposited with the Commissioner of Insurance to comply with the deposit requirements of the Insurance Code of the Commonwealth of Puerto Rico (the Insurance Code).

Information regarding realized and unrealized gains and losses from investments for the years ended December 31, 2016, 2015, and 2014 is as follows:

	2016			2015			2014
Realized gains (losses)
Fixed maturity securities
Securities available for sale
Gross gains from sales	$	3,086		$	8,208		$	5,118
Gross losses from sales		(2,744	)		(646	)		(5,884	)
Gross losses from other-than-temporary impairments		-			(4,267	)		(1,170	)
Total fixed maturity securities		342			3,295			(1,936	)
Equity securities
Securities available for sale
Gross gains from sales		19,674			17,903			20,848
Gross losses from sales		(1,203	)		(1,312	)		(2,106	)
Gross losses from other-than-temporary impairments		(1,434	)		(945	)		-
Total equity securities		17,037			15,646			18,742
Net realized gains on securities available for sale		17,379			18,941			16,806
Gross gain from other investment		-			-			1,425
Net realized gains on securities	$	17,379		$	18,941		$	18,231

The other-than-temporary impairments on fixed maturity securities are attributable to credit losses.

	2016			2015			2014
Changes in unrealized gains (losses)
Recognized in accumulated other comprehensive income (loss)
Fixed maturities – available for sale		1,953			(25,227	)		46,220
Equity securities – available for sale		2,172			(19,479	)		(5,620	)
	$	4,125		$	(44,706	)	$	40,600
Not recognized in the consolidated financial statements
Fixed maturities – held to maturity	$	(19	)	$	(24	)	$	49

The deferred tax asset (liability) on unrealized gains (losses) change recognized in accumulated other comprehensive income during the years 2016, 2015, and 2014 was $(1,085), $5,717, and $(4,717), respectively.

As of December 31, 2016 and 2015 no individual investment in securities exceeded 10% of stockholders’ equity.

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Net Investment Income

12 Months Ended

Dec. 31, 2016

Net Investment Income [Abstract]

Net Investment Income

4. Net Investment Income

Interest and/or dividend income from:

	Years ended December 31
	2016		2015		2014
Fixed maturities	$	37,139	$	36,256	$	38,559
Equity securities		9,666		7,146		7,660
Policy loans		619		557		545
Cash equivalents and interest-bearing deposits		257		143		117
Other		1,232		1,072		659
Total	$	48,913	$	45,174	$	47,540

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Premium and Other Receivables, Net

12 Months Ended

Dec. 31, 2016

Premium and Other Receivables, Net [Abstract]

Premium and Other Receivables, Net

5. Premium and Other Receivables, Net

Premium and other receivables, net as of December 31 were as follows:

	2016		2015
Premium	$	91,528	$	92,600
Self-funded group receivables		57,728		73,552
FEHBP		14,321		13,859
Agent balances		25,495		25,424
Accrued interest		13,668		12,624
Reinsurance recoverable		58,295		48,506
Other		62,637		53,325
		323,672		319,890
Less allowance for doubtful receivables:
Premium		27,320		28,944
Other		9,987		8,300
		37,307		37,244
Premium and other receivables, net	$	286,365	$	282,646

As of December 31, 2016 and 2015, the Company had premiums and other receivables of $57,750 and $78,230, respectively, from the Government of Puerto Rico, including its agencies, municipalities and public corporations. The related allowance for doubtful receivables as of December 31, 2016 and 2015 were $18,812 and $19,133, respectively.

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Deferred Policy Acquisition Costs and Value of Business Acquired

12 Months Ended

Dec. 31, 2016

Deferred Policy Acquisition Costs and Value of Business Acquired [Abstract]

Deferred Policy Acquisition Costs and Value of Business Acquired

6. Deferred Policy Acquisition Costs and Value of Business Acquired

The movement of deferred policy acquisition costs (DPAC) and value of business acquired (VOBA) for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	DPAC			VOBA			Total
Balance, December 31, 2013	$	140,928		$	36,361		$	177,289
Additions		48,723			-			48,723
VOBA interest at an average rate of 5.17%		-			1,726			1,726
Amortization		(37,895	)		(5,743	)		(43,638	)
Net change		10,828			(4,017	)		6,811
Balance, December 31, 2014		151,756			32,344			184,100
Additions		48,599			-			48,599
VOBA interest at an average rate of 5.15%		-			1,543			1,543
Amortization		(38,624	)		(4,970	)		(43,594	)
Net change		9,975			(3,427	)		6,548
Balance, December 31, 2015		161,731			28,917			190,648
Additions		47,742			-			47,742
VOBA interest at an average rate of 5.15%		-			1,381			1,381
Amortization		(40,848	)		(4,136	)		(44,984	)
Net change		6,894			(2,755	)		4,139
Balance, December 31, 2016	$	168,625		$	26,162		$	194,787

A portion of the amortization of the DPAC and VOBA is recorded as an amortization expense and included within the operating expenses in the accompanying consolidated statement of earnings.  The remaining portion of the DPAC and VOBA amortization includes the unrealized investment gains and losses that would have been amortized if such gains and losses had been realized, which for the year ended December 31, 2016 amounted to $3,147 and is included within the unrealized gains on securities component of other comprehensive income.

The estimated amount of the year-end VOBA balance expected to be amortized during the next five years is as follows:

Year ending December 31:
2017	$	3,582
2018		2,597
2019		2,279
2020		2,009
2021		2,075

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Property and Equipment, Net

12 Months Ended

Dec. 31, 2016

Property and Equipment, Net [Abstract]

Property and Equipment, Net

7. Property and Equipment, Net

Property and equipment, net as of December 31 are composed of the following:

	2016		2015
Land	$	10,976	$	10,976
Buildings and leasehold improvements		64,828		63,967
Office furniture and equipment		24,234		22,869
Computer equipment and software		114,749		113,223
Automobiles		593		494
		215,380		211,529
Less accumulated depreciation and amortization		149,011		137,576
Property and equipment, net	$	66,369	$	73,953

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Goodwill

12 Months Ended

Dec. 31, 2016

Goodwill [Abstract]

Goodwill

8. Goodwill

Certain business combination transactions have resulted in goodwill, which represents the excess of the acquisition cost over the fair value of net assets acquired, and is assigned to reporting units.  Goodwill recorded as of December 31, 2016 and 2015 was $25,397 which is mostly attributable to the Medicare Advantage reporting unit within the Managed Care segment.

As required by accounting guidance, the 2016 and 2015 annual goodwill impairment tests were performed and based on the results of the tests, no impairment charge was required.  If the Company does not achieve its earnings objectives or the cost of capital raises significantly, the assumptions and estimates underlying these impairment tests could be adversely affected and result in future impairment charges that would negatively impact its operating results.  Cumulative goodwill impairment charges were $2,369 as of December 31, 2016 and 2015.  All cumulative goodwill impairment is related to the health clinic reporting unit.

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Fair Value Measurements

12 Months Ended

Dec. 31, 2016

Fair Value Measurements [Abstract]

Fair Value Measurements

9. Fair Value Measurements

Assets recorded at fair value in the consolidated balance sheets are categorized based upon the level of judgment associated with the inputs used to measure their fair value.  Level inputs, as defined by current accounting guidance for fair value measurements and disclosures, are as follows:

Level Input Definition:

Level 1 Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date.

Level 2 Inputs other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with market data at the measurement date.

Level 3 Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date.

The Corporation uses observable inputs when available. Fair value is based upon quoted market prices when available. The Corporation limits valuation adjustments to those deemed necessary to ensure that the security’s fair value adequately represents the price that would be received or paid in the marketplace. Valuation adjustments may include consideration of counterparty credit quality and liquidity as well as other criteria.  The estimated fair value amounts are subjective in nature and may involve uncertainties and matters of significant judgment for certain financial instruments. Changes in the underlying assumptions used in estimating fair value could affect the results.  The fair value measurement levels are not indicative of risk of investment.

The fair value of investment securities is estimated based on quoted market prices for those or similar investments.  Additional information pertinent to the estimated fair value of investment in securities is included in note 3.

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	41,514	$	-	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,800		-		-		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		-		20,051		-		20,051
Municipal securities		-		683,803		-		683,803
Corporate Bonds		-		274,872		-		274,872
Residential agency mortgage-backed securities		-		718		-		718
Collaterized mortgage obligations		-		44,885		-		44,885
Total fixed maturities		85,800		1,065,843		-		1,151,643
Equity securities - Mutual funds		166,595		76,222		27,532		270,349
	$	252,395	$	1,142,065	$	27,532	$	1,421,992

	2015
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	116,240	$	-	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,270		-		-		163,270
Obligations of the Commonwealth of
Puerto Rico and its instrumentalities		-		25,619		-		25,619
Municipal securities		-		647,446		-		647,446
Corporate Bonds		-		157,408		-		157,408
Residential agency mortgage-backed securities		-		937		-		937
Collaterized mortgage obligations		-		22,725		-		22,725
Total fixed maturities		163,270		970,375		-		1,133,645
Equity securities - Mutual funds		167,082		22,031		7,958		197,071
	$	330,352	$	992,406	$	7,958	$	1,330,716

The fair value of fixed maturity and equity securities included in the Level 2 category were based on market values obtained from independent pricing services, which utilize evaluated pricing models that vary by asset class and incorporate available trade, bid and other market information and for structured securities, cash flow and when available loan performance data.  Because many fixed income securities do not trade on a daily basis, the models used by independent pricing service providers to prepare evaluations apply available information, such as benchmark curves, benchmarking of like securities, sector groupings, and matrix pricing.  For certain equity securities, quoted market prices for the identical security are not always available and the fair value is estimated by reference to similar securities for which quoted prices are available.  The independent pricing service providers monitor market indicators, industry and economic events, and for broker-quoted only securities, obtain quotes from market makers or broker-dealers that they recognize to be market participants. The fair value of the investments in partnerships included in the Level 3 category was based on the net asset value (NAV) which is affected by the changes in the fair market value of the investments held in these partnerships.

Transfers into or out of the Level 3 category occur when unobservable inputs, such as the Company’s best estimate of what a market participant would use to determine a current transaction price, become more or less significant to the fair value measurement.  Transfers between levels, if any, are recorded as of the actual date of the event or change in circumstance that caused the transfer.  There were no transfers between Levels 1 and 2 during the years ended December 31, 2016 and 2015.

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31 is as follows:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	2016			2015			2014
Balance as of January 1,	$	7,958		$	13,349		$	17,910
Realized gains		324			1,538			2,552
Unrealized in other accumulated comprehensive income		(1,458	)		(4,207	)		(2,937	)
Purchases		23,991			1,207			501
Sales		-			-			-
Capital Distributions		(3,283	)		(3,929	)		(4,677	)
Balance as of December 31,	$	27,532		$	7,958		$	13,349

In addition to the preceding disclosures on assets recorded at fair value in the consolidated balance sheets, accounting guidance also requires the disclosure of fair values for certain other financial instruments for which it is practicable to estimate fair value, whether or not such values are recognized in the consolidated balance sheets.

Non-financial instruments such as property and equipment, other assets, deferred income taxes and intangible assets, and certain financial instruments such as claim liabilities are excluded from the fair value disclosures. Therefore, the fair value amounts cannot be aggregated to determine our underlying economic value.

The carrying amounts reported in the consolidated balance sheets for cash and cash equivalents, receivables, accounts payable and accrued liabilities, and short-term borrowings approximate fair value because of the short term nature of these items.  These assets and liabilities are not listed in the table below.

The following methods, assumptions and inputs were used to estimate the fair value of each class of financial instrument:

(i)  Policy Loans

Policy loans have no stated maturity dates and are part of the related insurance contract. The carrying amount of policy loans approximates fair value because their interest rate is reset periodically in accordance with current market rates.

(ii)  Policyholder Deposits

The fair value of policyholder deposits is the amount payable on demand at the reporting date, and accordingly, the carrying value amount approximates fair value.

(iii)  Long-term Borrowings

The carrying amount of the loans payable to bank – variable approximates fair value due to its floating interest-rate structure.  The fair value of the loans payable to bank – fixed and senior unsecured notes payable was determined using broker quotations.

A summary of the carrying value and fair value by level of financial instruments not recorded at fair value on our consolidated balance sheets at December 31, 2016 and 2015 are as follows:

	2016
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	8,564	$	-	$	8,564	$	-	$	8,564
Liabilities:
Policyholder deposits	$	179,382	$	-	$	179,382	$	-	$	179,382
Long-term borrowings:
Loans payable to bank - variable		11,187		-		11,187		-		11,187
6.6% senior unsecured notes payable		24,000		-		24,000		-		24,000
Total long-term borrowings		35,187		-		35,187		-		35,187
Total liabilities	$	214,569	$	-	$	214,569	$	-	$	214,569

	2015
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	7,901	$	-	$	7,901	$	-	$	7,901
Liabilities:
Policyholder deposits	$	179,287	$	-	$	179,287	$	-	$	179,287
Long-term borrowings:
Loans payable to bank - variable		12,827		-		12,827		-		12,827
6.6% senior unsecured notes payable		24,000		-		19,920		-		19,920
Total long-term borrowings		36,827		-		32,747		-		32,747
Total liabilities	$	216,114	$	-	$	212,034	$	-	$	212,034

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Claim Liabilities and Claim Adjustment Expenses

12 Months Ended

Dec. 31, 2016

Claim Liabilities and Claim Adjustment Expenses [Abstract]

Claim Liabilities and Claim Adjustment Expenses

10. Claim Liabilities and Claim Adjustment Expenses

A reconciliation of the beginning and ending balances of claim liabilities in 2016, 2015 and 2014 is as follows:

	2016
	Managed Care			Other  Business Segments *			Consolidated
Claim liabilities at beginning of year	$	348,297		$	143,468		$	491,765
Reinsurance recoverable on claim liabilities		-			(40,714	)		(40,714	)
Net claim liabilities at beginning of year		348,297			102,754			451,051
Claims incurred
Current period insured events		2,356,594			103,049			2,459,643
Prior period insured events		(9,047	)		(7,157	)		(16,204	)
Total		2,347,547			95,892			2,443,439
Payments of losses and loss-adjustment
expenses
Current period insured events		2,083,552			58,091			2,141,643
Prior period insured events		263,245			40,657			303,902
Total		2,346,797			98,748			2,445,545
Net claim liabilities at end of year		349,047			99,898			448,945
Reinsurance recoverable on claim liabilities		-			38,998			38,998
Claim liabilities at end of year	$	349,047		$	138,896		$	487,943

	2015
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	249,330		$	140,756		$	390,086
Reinsurance recoverable on claim liabilities		-			(40,635	)		(40,635	)
Net claim liabilities at beginning of year		249,330			100,121			349,451
Claims incurred
Current period insured events		2,216,330			98,279			2,314,609
Prior period insured events		(19,637	)		(1,211	)		(20,848	)
Total		2,196,693			97,068			2,293,761
Payments of losses and loss-adjustment
expenses
Current period insured events		1,868,607			52,369			1,920,976
Prior period insured events		229,119			42,066			271,185
Total		2,097,726			94,435			2,192,161
Net claim liabilities at end of year		348,297			102,754			451,051
Reinsurance recoverable on claim liabilities		-			40,714			40,714
Claim liabilities at end of year	$	348,297		$	143,468		$	491,765

	2014
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	283,615		$	136,806		$	420,421
Reinsurance recoverable on claim liabilities		-			(37,557	)		(37,557	)
Net claim liabilities at beginning of year		283,615			99,249			382,864
Claims incurred
Current period insured events		1,665,255			95,944			1,761,199
Prior period insured events		(36,160	)		(1,251	)		(37,411	)
Total		1,629,095			94,693			1,723,788
Payments of losses and loss-adjustment
expenses
Current period insured events		1,449,224			50,422			1,499,646
Prior period insured events		214,156			43,399			257,555
Total		1,663,380			93,821			1,757,201
Net claim liabilities at end of year		249,330			100,121			349,451
Reinsurance recoverable on claim liabilities		-			40,635			40,635
Claim liabilities at end of year	$	249,330		$	140,756		$	390,086

* Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations.

As a result of differences between actual amounts and estimates of insured events in prior years, the amounts included as claims incurred for prior period insured events differ from anticipated claims incurred.

The favorable developments in the claims incurred and loss-adjustment expenses for prior period insured events for 2016, 2015 and 2014 are due primarily to better than expected utilization trends mostly in the Managed Care segment.  Reinsurance recoverable on unpaid claims is reported as premium and other receivables, net in the accompanying consolidated financial statements.

The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,807 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

The following is information about incurred and paid claims development, net of reinsurance, as of December 31, 2016, as well as cumulative claim frequency.  Additional information presented includes total incurred- but- not- reported liabilities plus expected development on reported claims is included within the net incurred claims amounts.

The information about incurred and paid claims development for the year ended December 31, 2015 and previous years are presented as supplementary information and unaudited where indicated.

Managed Care

The Company estimates its liabilities for unpaid claims following a detailed actuarial process that entails using both historical claim payment patterns as well as emerging medical cost trends to project a best estimate of claim liabilities. This process includes comparing the historical claims incurred dates to the actual dates on claims payment.  Completion factors are applied to claims paid through the financial statements date to estimate the claim expense incurred for the current period.  The liability for claim adjustment expenses consists of adjustments made by our actuaries based on their knowledge and their estimate of emerging impacts to benefit costs and payment speed.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance					As of December 31, 2016
	Incurred amount						(in thousands)
Incurred Year	(unaudited) 2015			2016	Total of IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
2015	$	2,216,330		2,207,283		75,431		17,830
2016				2,356,592		273,040		16,633
	Total		$	4,563,875

Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year	(unaudited) 2015			2016
2015	$	1,868,607		2,131,852
2016				2,083,552
	Total		$	4,215,404
All outstanding liabilities before 2015, net of reinsurance				576
Liabilities for claims and claim adjustment expenses, net of reinsurance			$	349,047

Property and Casualty

Claims liability for property and casualty represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expense for investigating and setting claims.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																					As of December 31, 2016
Incurred Year	Incurred amount																				Total of IBNR Plus Expected Development on Reported Claims		Cumulative Number of reported claims
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
2007	$	51,531	$	49,555	$	47,673	$	45,836	$	45,380	$	45,654	$	45,534	$	45,534	$	45,515	$	45,604	$	27		15,762
2008				49,095		48,812		46,443		45,941		45,541		47,658		45,909		45,535		45,571		142		16,089
2009						51,778		51,760		50,848		51,298		51,564		51,315		51,485		51,293		177		18,013
2010								54,226		54,090		55,266		56,400		57,115		57,386		57,242		482		20,918
2011										51,315		50,287		51,105		50,776		51,895		52,099		656		20,222
2012												49,040		49,856		48,900		49,817		48,945		1,565		22,366
2013														52,343		51,030		49,606		49,168		2,274		22,045
2014																48,430		45,410		43,707		3,377		20,085
2015																		45,067		40,175		6,160		18,912
2016																				48,127		16,806		19,897
																	Total		$	481,931

Cumulative Paid claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year
	(unaudited) 2007		(unaudited) 2008		(unaudited) 2009		(unaudited) 2010		(unaudited) 2011		(unaudited) 2012		(unaudited) 2013		(unaudited) 2014		(unaudited) 2015		2016
2007	$	20,912	$	31,298	$	36,287	$	39,477	$	41,918	$	43,203	$	44,007	$	44,470	$	44,835	$	45,133
2008				23,715		32,834		37,420		40,332		41,847		43,787		44,426		44,703		44,867
2009						23,843		35,327		41,810		45,838		48,637		49,709		50,196		50,371
2010								27,118		38,964		45,409		49,808		52,890		54,027		54,996
2011										24,534		34,835		41,606		44,996		47,908		49,598
2012												22,677		33,620		40,406		43,663		45,607
2013														21,376		33,249		38,979		42,840
2014																18,752		28,657		33,809
2015																		17,063		24,935
2016																				20,099
																			$	412,255
										All Outstanding liabilities before 2007, net of reinsurance										1,415
										Liabilities for claims and claims adjustment expenses, net of reinsurance									$	71,091

At December 31, 2016 the amounts of unpaid claims and claim adjustment expenses in the accompanying financial statements are $481,931 and $412,255, respectively.

The following table includes the annual percentage payout of incurred claims by age, net of reinsurance, for property and casualty segment as supplementary information as of December 31, 2016:

	(unaudited) 2007			(unaudited) 2008			(unaudited) 2009			(unaudited) 2010			(unaudited) 2011			(unaudited) 2012			(unaudited) 2013			(unaudited) 2014			(unaudited) 2015			(unaudited) 2016
Average		45.6	%		21.6	%		11.9	%		7.1	%		4.8	%		2.9	%		1.5	%		0.7	%		0.6	%		0.7	%

The reconciliation of the net incurred and paid claims development tables, by segment, to the liability for claims and claim adjustment expenses in the consolidated balance sheets is as follows:

	As of December 31, 2016
Net outstanding liabilities
Managed Care	$	349,047
Property and Casualty		71,091
Other short-duration insurance lines		102
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		420,240
Reinsurance recoverable on unpaid claims - Property and Casualty		25,885
Insurance lines other than short-duration		42,757
Intersegment Elimination		(939	)
Total gross liability for unpaid claims and claim adjustment expense	$	487,943

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Federal Employees' Health Benefits (FEHBP) and Federal Employees' (FEP) Programs

12 Months Ended

Dec. 31, 2016

Federal Employees' Health Benefits (FEHBP) and Federal Employees' (FEP) Programs [Abstract]

Federal Employees' Health Benefits (FEHBP) and Federal Employees' (FEP) Programs

11. Federal Employees’ Health Benefits (FEHBP) and Federal Employees’ (FEP) Programs

FEHBP

In prior years, TSS entered into a contract, renewable annually, with the Office of Personnel Management (OPM) as authorized by the Federal Employees’ Health Benefits Act of 1959, as amended, to provide health benefits under the FEHBP.  The FEHBP covers postal and federal employees residing in the Commonwealth of Puerto Rico and the United States Virgin Islands as well as retirees and eligible dependents.  The FEHBP is financed through a negotiated contribution made by the federal government and employees’ payroll deductions.

The accounting policies for the FEHBP are the same as those described in the Company’s summary of significant accounting policies.  Premium rates are determined annually by TSS and approved by the federal government.  Claims are paid to providers based on the guidelines determined by the federal government.  Operating expenses are allocated from TSS’s operations to the FEHBP based on applicable allocation guidelines (such as, the number of claims processed for each program) and are subject to contractual expense limitations.

The operations of the FEHBP do not result in any excess or deficiency of revenue or expense as this program has a special account available to compensate any excess or deficiency on its operations to the benefit or detriment of the federal government.  Any transfer to/from the special account necessary to cover any excess or deficiency in the operations of the FEHBP is recorded as a reduction/increment to the premiums earned.  The contract with OPM provides that the cumulative excess of the FEHBP earned income over health benefits charges and expenses represents a restricted fund balance denoted as the special account.  Upon termination of the contract and satisfaction of all the FEHBP’s obligations, any unused remainder of the special reserve would revert to the Federal Employees Health Benefit Fund.  In the event that the contract terminates and the special reserve is not sufficient to meet the FEHBP’s obligations, the FEHBP contingency reserve will be used to meet such obligations.  If the contingency reserve is not sufficient to meet such obligations, the Company is at risk for the amount not covered by the contingency reserve.

The contract with OPM allows for the payment to the Company of service fees as negotiated between TSS and OPM.

The Company also has funds available related to the FEHBP amounting to $50,789 and $42,572 as of December 31, 2016 and 2015, respectively and are included within the cash and cash equivalents in the accompanying consolidated balance sheets.  Such funds are used to cover health benefits charges, administrative expenses and service charges required by the FEHBP.

A contingency reserve is maintained by the OPM at the U.S. Treasury, and is available to the Company under certain conditions as specified in government regulations.  Accordingly, such reserve is not reflected in the consolidated balance sheets.  The balance of such reserve as of December 31, 2016 and 2015 was $26,180 and $28,417, respectively.  The Company received $6,687, $4,763, and $12,766, of payments made from the contingency reserve fund of OPM during 2016, 2015, and 2014, respectively.

The claim payments and operating expenses charged to the FEHBP are subject to audit by the U.S. government.  Management is of the opinion that an adjustment, if any, resulting from such audits will not have a significant effect on the accompanying financial statements.  The claim payments and operating expenses reimbursed in connection with the FEHBP have been audited through 2011 by OPM.

FEP

In prior years, TSS entered into a contract with the BCBSA as per Contract No. C.S. 1039 with OPM to provide health benefits under one Government-wide Service Benefit Plan as contemplated in Title 5, Chapter 89, United States Code. The FEP covers employees and annuitants residing in the Commonwealth of Puerto Rico and the United States Virgin Islands as well as eligible dependents. The FEP is financed through a negotiated contribution made by the federal government and employees’ payroll deductions.  The accounting methodology and operations of the FEP are similar to those of the FEHBP as described before.

The Company also has funds overdraft related to the FEP amounting to $1,812 at December 31, 2016 and are included within the cash and cash equivalents in the accompanying balance sheets.

The claims payments and operating expenses charged to the FEP are subject to audit by the BCBSA. Management is of the opinion that the adjustments, if any, resulting from such audits will not have a significant effect in the accompanying financial statements. Operating expenses reimbursed in connection with the FEP have been audited through 2015 by BCBSA.

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Long-Term Borrowings

12 Months Ended

Dec. 31, 2016

Long-Term Borrowings [Abstract]

Long-Term Borrowings

12. Long-Term Borrowings

A summary of the borrowings entered by the Company as of December 31 is as follows:

	2016		2015
Senior unsecured notes payable of $60,000 issued on
December 2005; due December 2020. Interest is payable monthly at a fixed rate of 6.60%.	$	24,000	$	24,000
Secured loan payable of $41,000, payable in monthly installments of $137 through July 1, 2024, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.23% at December 31, 2015.)		-		12,827
Secured loan payable of $11,187, payable in monthly installments of $137 through October 1, 2023, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.77% at December 31, 2016.)		11,187		-
Total borrowings		35,187		36,827
Less unamortized debt issuance costs		102		-
	$	35,085	$	36,827

Aggregate maturities of the Company’s borrowings as of December 31, 2016 are summarized as follows:

Year ending December 31
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
	$	35,187

All of the Company’s senior notes may be prepaid at par, in total or partially, five years after issuance as determined by the Company.  The Company’s senior unsecured notes contain certain non-financial covenants with which the Company has complied at December 31, 2016.

On December 28, 2016, TSM entered into a $35,500 credit agreement with a commercial bank in Puerto Rico. The agreement consists of three term loans: (i) Term Loan A in the principal amount of $11,187, (ii) Term Loan B in the principal amount of $20,150 and (iii) Term Loan C in the principal amount of $4,116. Term Loan A matures in October 2023 while the Term Loans B and C mature in January 2024.  Term Loan A was used to refinance the previous $41,000 secured loan payable with the same commercial bank in Puerto Rico.  Proceeds from Term Loans B and C were received on January 11, 2017 and were used to prepay the outstanding principal amount plus accrued interest of the 6.6% Senior Unsecured Notes due January 2021 ($24,000), and fund a portion of a debt service reserve for the Loan (approximately $200).  Pursuant to the credit agreement, interest is payable on the outstanding balance of the Loan at the following annual rate: (1) 1% over LIBOR for Term Loan A, (ii) 2.75% over LIBOR for Term Loan B, and (iii) 3.25% over LIBOR for Term Loan C.  Interest shall be payable commencing on January 1, 2017, in the case of Term Loan A, and on February 1, 2017, in the case of Term Loan B and Term Loan C.  The Credit Agreement includes certain financial and non-financial covenants, including negative covenants imposing certain restrictions on the Corporation’s business.  The Company was in compliance with all these covenants as of December 31, 2016.

The credit agreement is guaranteed by a first mortgage held by the bank on the Company’s land, building, and substantially all leasehold improvements, as collateral for the term of the loan under a continuing general security agreement.  This credit agreement contains certain non-financial covenants, which are customary for this type of facility, including but not limited to, restrictions on the granting of certain liens, limitations on acquisitions and limitations on changes in control and dividends.

The Company may, at its option, upon notice, as specified in the credit agreement, redeem and prepay prior to maturity, all or any part of the Loan and from time to time upon the payment of a penalty fee of 3% during the first year, 2% during the second year and 1% during the third year, and thereafter, at par, as specified in the credit agreement, together with accrued and unpaid interest, if any, to the date of redemption specified by the Company.

Interest expense on the above borrowings amounted to $1,763, $2,435, and $3,639, for the years ended December 31, 2016, 2015, and 2014, respectively.

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Reinsurance Activity

12 Months Ended

Dec. 31, 2016

Reinsurance Activity [Abstract]

Reinsurance Activity

13. Reinsurance Activity

The effect of reinsurance on premiums earned and claims incurred is as follows:

	Premiums Earned									Claims Incurred(1)
	2016			2015			2014			2016			2015			2014
Gross	$	2,949,673		$	2,847,288		$	2,199,351		$	2,458,447		$	2,313,191		$	1,748,972
Ceded		(59,032	)		(64,134	)		(70,785	)		(15,008	)		(19,430	)		(25,184	)
Net	$	2,890,641		$	2,783,154		$	2,128,566		$	2,443,439		$	2,293,761		$	1,723,788

⁽¹⁾ The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,806 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

TSS, TSP and TSV, in accordance with general industry practices, annually purchase reinsurance to protect them from the impact of large unforeseen losses and prevent sudden and unpredictable changes in net income and stockholders’ equity of the Company.  Reinsurance contracts do not relieve any of the subsidiaries from their obligations to policyholders.  In the event that all or any of the reinsuring companies might be unable to meet their obligations under existing reinsurance agreements, the subsidiaries would be liable for such defaulted amounts.  During 2016, 2015, and 2014 TSP placed 13.16%, 14.06%, and 13.26% of its reinsurance business with one reinsurance company.

TSS has excess of loss reinsurance treaties whereby it cedes a portion of its premiums to third parties.  Reinsurance contracts are primarily for periods of one year, and are subject to modifications and negotiations in each renewal date.  Premiums ceded under these contracts amounted to $3,148, $3,678, and $4,901 in 2016, 2015 and 2014, respectively.  Claims ceded amounted to $1,700, $2,665, and $5,487, in 2016, 2015 and 2014, respectively.  Principal reinsurance agreements include an organ transplant excess of loss treaty, which covers:

· For group policies, 80% of the claims up to a maximum of $800 (80% of $1,000), per person, per life. For other group policies with other options, the agreement covers 80% of the claims up to a maximum of $400 (80% of $500), per person, per life, or 80% of the claims up to a maximum of $200 (80% of $250), per person, per life.

· For policies provided to the active and retired employees of the Commonwealth of Puerto Rico and its instrumentalities, the treaty covers 100% of the claims up to a maximum of $500 per person, per life with a basic coverage, and $1,000 per person, per life with Major medical coverage.

· For policies provided to the municipalities of Puerto Rico, the treaty covers 100% of the claims up to a maximum of $250 with plans with lifetime limits and all other plans 100% of the claims up to a maximum of $1,000.

· For U.S. Virgin Islands policies, the treaty covers 100% of the claims up to a maximum of $2,000 per person, per life.  The first $200 are retained by Triple-S and the excess up to $800 are reinsured.

TSP has a number of pro rata and excess of loss reinsurance treaties whereby the subsidiary retains for its own account all loss payments for each occurrence that does not exceed the stated amount in the agreements and a catastrophe cover, whereby it protects itself from a loss or disaster of a catastrophic nature.  Under these treaties, TSP ceded premiums of $45,957, $48,676, and $52,058, in 2016, 2015, and 2014, respectively.

Reinsurance cessions are made on excess of loss and on a proportional basis.  Principal reinsurance agreements are as follows:

· Property quota share treaty covering for a maximum of $30,000 for any one risk.  Under this treaty 30% of the risk is ceded to reinsurers.  The remaining exposure is covered by a property per risk excess of loss treaty that provides reinsurance in excess of $500 up to a maximum of $21,000, or the remaining 70% for any one risk.  In addition, TSP has an additional property catastrophe excess of loss contract that provides protection for losses in excess of $8,000 resulting from any catastrophe, subject to a maximum loss of $15,000.

· Personal property catastrophe excess of loss.  This treaty provides protection for losses in excess of $5,000 resulting from any catastrophe, subject to a maximum loss of $80,000.

· Commercial property catastrophe excess of loss.  This treaty provides protection for losses in excess of $10,000 resulting from any catastrophe, subject to a maximum loss of $135,000.

· Property catastrophe excess of loss.  This treaty provides a $235,000 protection in excess of $80,000 and $135,000 with respect to personal and commercial lines, respectively, resulting from any catastrophe, subject to a maximum loss of $175,000 in respect of the ceded portion of the Commercial Lines Quota Share.

· Reinstatement premium protection.  This treaty provides a maximum limit of approximately $3,400 for personal lines and $10,000 in commercial lines to cover the necessity of reinstating the catastrophe program in the event it is activated.

· Casualty excess of loss treaty.  This treaty provides reinsurance for losses in excess of $225 up to a maximum of $12,000.

· Medical malpractice excess of loss.  This treaty provides reinsurance in excess of $150 up to a maximum of $3,000 per incident.

· Builders’ risk quota share and first surplus covering contractors’ risk.  This treaty provides protection on a 20/80 quota share basis for the initial $2,500 and a first surplus of $12,500 for a maximum of $14,500 for any one risk.

· Surety quota share treaty covering contract and miscellaneous surety bond business. This treaty provides reinsurance of up to $5,000 for contract surety bonds, subject to an aggregate of $10,000 per contractor and $3,000 per miscellaneous surety bond.

Facultative reinsurance is obtained when coverage per risk is required. All principal reinsurance contractsare for a period of one year, on a calendar basis, and are subject to modifications and negotiations in each renewal.

The ceded unearned reinsurance premiums on TSP arising from these reinsurance transactions amounted to $9,202 and $10,291 at December 31, 2016 and 2015, respectively, and are reported as other assets in the accompanying consolidated balance sheets.

TSV also cedes insurance with various reinsurance companies under a number of pro rata, excess of loss and catastrophe treaties. Under these treaties, TSV ceded premiums of $8,838, $9,596, and $10,328, in 2016, 2015, and 2014, respectively. Principal reinsurance agreements are as follows:

· Group life insurance facultative agreement, reinsuring risk in excess of $25 of certain group life policies and a combined pro rata and excess of loss agreement effective July 1, 2008, reinsuring 50% of the risk up to $200 and ceding the excess.

· Facultative pro rata agreements for the long‑term disability insurance, reinsuring 65% of the risk.

· Several reinsurance agreements, mostly on an excess of loss basis up to a maximum retention of $50. For certain new life products that have been issued after 1999, the retention limit is $175, and for others issued after January 1, 2015, the retention limit is $200.

· A quota share agreement for group major medical and an excess of loss agreements for group and individual major medical, where TSV cedes 40% of all claims up to a maximum retention of $100 and 70% of all claims over $100 up to a maximum of $2,000.

· Excess of loss agreement for the Major Medical Business in Costa Rica reinsuring 100% of all claims over $25.

TSV participates in various retrocession reinsurance agreements since early 2014. The retrocessions are based on group life and health reinsurance business pools for which TSV has participations ranging from 6.7% to 15% of the total reinsurance facility. TSV share of the reinsurer’s gross liability is limited to a maximum that ranges depending on the agreement from $50 to $500 per covered life. The agreements cover new and renewal business for a period of twelve months and may be cancelled subject to ninety days written notice at any anniversary date.

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Income Taxes

12 Months Ended

Dec. 31, 2016

Income Taxes [Abstract]

Income Taxes

14. Income Taxes

The Company and its subsidiaries are subject to Puerto Rico income taxes. Under Puerto Rico income tax law, the Company is not allowed to file consolidated tax returns with its subsidiaries. The Company’s insurance subsidiaries are also subject to U.S. federal income taxes for foreign source dividend income.  The Company is potentially subject to income tax audits in the Commonwealth of Puerto Rico for the taxable year 2015, until the applicable statute of limitations expire. Tax audits by their nature are often complex and can require several years to complete.

Managed Care and Property and Casualty corporations are taxed essentially the same as other corporations, with taxable income primarily determined on the basis of the statutory annual statements filed with the insurance regulatory authorities. The corporations are also subject to an alternative minimum income tax, which is calculated based on the formula established by existing tax laws. Any alternative minimum income tax paid may be used as a credit against the excess, if any, of regular income tax over the alternative minimum income tax in future years up to a limit of 25% of the excess.

The Company, through one of its Managed Care corporations, has a branch in the United States Virgin Islands that is subject to a 5% premium tax on policies underwritten therein. As a qualified foreign insurance company, the Company is subject to income taxes in the U.S. Virgin Islands, which has implemented a mirror tax law based on the U.S. Internal Revenue Code.  The branch operations in the U.S. Virgin Islands had certain net operating losses for U.S. Virgin Islands tax purposes for which a valuation allowance has been recorded.

Companies within our Life Insurance segment operate as qualified domestic life insurance companies and are subject to the alternative minimum tax and taxes on its capital gains.

Federal income taxes recognized by the Company’s insurance subsidiaries amounted to approximately $733, $574, and $451, in 2016, 2015, and 2014, respectively.

All other corporations within the group are subject to Puerto Rico income taxes as regular corporations, as defined in the P.R. Internal Revenue Code, as amended.  The holding company within the TSA group of companies is a U.S.-based corporation and is subject to U.S. federal income taxes.  This U.S-based corporation within our group has not provided U.S. deferred taxes on an outside basis difference created as a result of the business combination of TSA and cumulative earnings of its Puerto Rico-based subsidiaries that are considered to be indefinitely reinvested.  The total outside basis difference at December 31, 2016 and 2015 is estimated at $26,000 and $59,000, respectively.  We do not intend to repatriate earnings to fund U.S. and Puerto Rico operations nor do any transaction that would cause a reversal of that outside basis difference.  Because of the availability of U.S. foreign tax credits, it is not practical to determine the U.S. federal income tax liability if such outside basis difference was reversed.

On July 1, 2014, the Governor of Puerto Rico signed into law Act No. 77 including multiple amendments to the Puerto Rico tax code that had a direct impact on the tax liabilities of individual and corporate taxpayers.  The amendments to the Puerto Rico tax code include, among others, changes to the corporate tax rate on long-term capital gains, which was increased from 15% to 20% for all transactions occurring after June 30, 2014.  During the year ended December 31, 2014, the Company recognized a one-time charge to operations of approximately $6,300 as a consequence of this change in the enacted rate to account for the effect of the increase in rate in the unrealized gain on its investment portfolio.

Act No. 77 also allowed corporations to elect, during the period running from July 1, 2014 to October 31, 2014, to prepay at a reduced income tax rate of 12% the increase in value of long-term capital assets.  On December 22, 2014 and March 30, 2015, the Governor of Puerto Rico signed into law Act No. 238 and Act No. 44, respectively, providing further amendments to the provisions set forth by Act No.77, extending the period to prepay at the reduced tax rate of 12% on the increase in value of long-term capital assets until April 30, 2015.  In connection with this law, on April 15, 2015 and December 31, 2014, the group of corporations that comprise TSM entered into Closing Agreements with the Puerto Rico Department of Treasury.  The Closing Agreements, among other matters, were related with the payment of the preferential tax rate on the increase in value of some of its long-term capital assets, as permitted by Act No. 238 of 2014 and Act No. 44 of 2015.  The agreements also covered certain tax attributes of the Corporation.  As a result of the aforementioned tax laws and the Closing Agreements, the Company: (1) obtained a benefit from the lower tax rate provided under these statutes, (2) reassessed the realizability of some of its deferred taxes and (3) recorded a tax benefit of $2,524 for the year ended December 31, 2015.

The components of income tax (benefit) expense consisted of the following:

	2016			2015			2014
Current income tax expense	$	1,981		$	10,169		$	22,551
Deferred income tax benefit		(8,326	)		(5,070	)		(21,806	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

The income tax (benefit) expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	2016			2015			2014
Income before taxes	$	11,086		$	57,131		$	66,051
Statutory tax rate		39.00	%		39.00	%		39.00	%
Income tax expense at statutory rate		4,324			22,281			25,760
Increase (decrease) in taxes resulting from
Exempt interest income, net		(5,158	)		(6,041	)		(7,139	)
Effect of taxing life insurance operations as a qualified domestic life insurance company instead of as a regular corporation		(5,033	)		(4,936	)		(5,572	)
Effect of taxing capital gains at a preferential rate		(3,799	)		(7,432	)		(14,248	)
Dividends received deduction		-			270			173
Adjustment to deferred tax assets and liabilities for changes in effective tax rates		1,669			(1,576	)		5,466
Other adjustments to deferred tax assets and liabilities		2,852			(58	)		(707	)
Effect of extraordinary dividend distribution from the Association - reported net of taxes in other income		(151	)		(875	)		-
Tax credit benefit		(709	)		(537	)		(1,482	)
Tax returns to provision true up		(181	)		(1,084	)		-
Effect of reassessment of unused credits for alternative minimum taxes paid		-			-			(6,486	)
Subtotal		(10,510	)		(22,269	)		(29,995	)
Other permanent disallowances, net:
Disallowed resolution agreements expense		-			1,716			-
Disallowance of expenses related to exempt interest income		58			-			46
Disallowed dividend received deduction		-			3,598			4,815
Disallowed interest expense		8			12			21
Other		-			61			282
Total other permanent differences		66			5,387			5,164
Other adjustments		(225	)		(300	)		(184	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

Deferred income taxes reflect the tax effects of temporary differences between carrying amounts of assets and liabilities for financial reporting purposes and income tax purposes. The net deferred tax asset at December 31, 2016 and 2015 of the Company and its subsidiaries is composed of the following:

	2016			2015
Deferred tax assets
Allowance for doubtful receivables	$	10,070		$	13,434
Liability for pension benefits		10,624			21,416
Employee benefits plan		1,580			3,177
Postretirement benefits		772			1,252
Deferred compensation		2,041			1,818
Accumulated depreciation		1,137			1,240
Impairment loss on investments		2,035			1,749
Contingency reserves		-			30
Share-based compensation		4,393			4,875
Alternative minimum income tax credit		1,991			2,066
Purchased tax credits		6,062			931
Net operating loss		33,081			12,721
Difference in tax basis of investments portfolio		3,049			6,843
Accrued liabilities		2,133			2,402
Other		772			591
Gross deferred tax assets		79,740			74,545
Less: valuation allowance		(8,016	)		(7,839	)
Deferred tax assets		71,724			66,706
Deferred tax liabilities
Deferred policy acquisition costs		(6,621	)		(3,673	)
Catastrophe loss reserve		(8,020	)		(7,664	)
Unrealized gain on securities available for sale		(15,804	)		(15,021	)
Unamortized debt issue costs		(152	)		(29	)
Intangible asset		(2,195	)		(3,013	)
Accumulated depreciation		(14	)		(15	)
Gross deferred tax liabilities		(32,806	)		(29,415	)
Net deferred tax asset	$	38,918		$	37,291

The net deferred tax asset shown in the table above at December 31, 2016 and 2015 is reflected in the consolidated balance sheets as $57,768 and $52,361, respectively, in deferred tax assets and $18,850 and $15,070, in deferred tax liabilities, respectively, reflecting the aggregate deferred tax assets or liabilities of individual tax-paying subsidiaries of the Company.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management believes that it is more likely than not that the Company will realize the benefits of these deductible differences.  The valuation allowance is mostly related with the net operating losses generated by the Company’s U.S. Virgin Islands and health clinic’s operations that based on the available evidence are not considered to be realizable at the reporting dates.

At December 31, 2016, the Company and its subsidiaries has net operating loss carry-forwards for Puerto Rico income tax purposes of approximately $75,000, which are available to offset future taxable income for up to December 2026. Except for the valuation allowance described in the previous paragraph, the corporation concluded that as of December 31, 2016,  it is more likely than not that the entities that have these net operating loss carry-forwards will generate sufficient taxable income within  the applicable  net operating loss carry-forward periods  to realize its deferred tax asset. This conclusion is based on the historical results of each entity, adjusted to exclude non-recurring conditions, and the forecast of future profitability. Management will continue to evaluate, on a quarterly basis, if there are any significant events that will affect the corporation’s ability to utilize these deferred tax assets.

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Pension Plans

12 Months Ended

Dec. 31, 2016

Pension Plans [Abstract]

Pension Plans

15. Pension Plans

Noncontributory Defined‑Benefit Pension Plan

The Company sponsors a noncontributory defined-benefit pension plan for its employees and for the employees of certain subsidiaries.  Pension benefits begin to vest after five years of vesting service, as defined, and are based on years of service and final average salary, as defined. The funding policy is to contribute to the plan as necessary to meet the minimum funding requirements set forth in the Employee Retirement Income Security Act of 1974, as amended, plus such additional amounts as the Company may determine to be appropriate from time to time.  The measurement date used to determine pension benefit for the pension plan is December 31.

The following table sets forth the plan’s benefit obligations, fair value of plan assets, and funded status as of December 31, 2016 and 2015, accordingly:

	2016			2015
Change in benefit obligation
Benefit obligation at beginning of year	$	184,782		$	205,254
Service cost		3,640			4,137
Interest cost		8,749			8,281
Benefit payments		(12,911	)		(7,591	)
Actuarial (gain) loss		14,709			(25,299	)
Liability gain due to curtailment		(35,092	)		-
Benefit obligation at end of year	$	163,877		$	184,782
Accumulated benefit obligation at end of year	$	163,877		$	152,851
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	130,061		$	128,108
Actual return on assets		13,248			1,544
Employer contributions		10,000			8,000
Benefit payments		(12,911	)		(7,591	)
Fair value of plan assets at end of year	$	140,398		$	130,061
Funded status at end of year	$	(23,479	)	$	(54,721	)
Amounts in accumulated other comprehensive income not yet recognized as a component of net periodic pension cost
Development of prior service credit
Balance at beginning of year	$	(2,223	)	$	(2,673	)
Amortization		450			450
Curtailment/Settlement		1,773			-
Net prior service credit		-			(2,223	)
Development of actuarial loss
Balance at beginning of year		55,716			80,118
Amortization		(4,028	)		(5,939	)
(Gain)/Loss arising during the year		10,464			(18,463	)
Curtailment/Settlement gain during the year		(35,092	)		-
Actuarial net loss		27,060			55,716
Sum of deferrals	$	27,060		$	53,493
Net amount recognized	$	3,581		$	(1,228	)

The following assumptions were used on a weighted average basis to determine benefits obligations of the plan as of December 31, 2016 and 2015.

	2016			2015
Discount rate		4.50	%		4.75	%
Rate of compensation increase		N/A		Graded; 3.50		%
				to 8.00		%

The assumed discount rate of 4.50% at December 31, 2016 reflects the hypothetical rate at which the projected benefit obligations could be effectively settled or paid out to participants on that date. The Company determined the discount rate based on a range of factors, including a yield curve comprised of the rates of return on high-quality, fixed-income corporate bonds available at the measurement date and the related expected duration for the obligations.

The amounts recognized in the balance sheets as of December 31, 2016 and 2015 consist of the following:

	2016		2015
Pension liability	$	23,479	$	54,721
Accumulated other comprehensive loss, net of a deferred tax of $7,191 and $17,500 in 2016 and 2015, respectively		19,869		35,993

The components of net periodic benefit cost for 2016, 2015, and 2014 were as follows:

	2016			2015			2014
Components of net periodic benefit cost
Service cost	$	3,640		$	4,137		$	3,589
Interest cost		8,749			8,281			8,287
Expected return on plan assets		(9,003	)		(8,380	)		(7,496	)
Prior service benefit		(450	)		(450	)		(450	)
Actuarial loss		4,028			5,939			4,134
Net periodic benefit cost	$	6,964		$	9,527		$	8,064

Net periodic benefit cost may include settlement charges as a result of retirees selecting lump-sum distributions. Settlement charges may increase in the future if the number of eligible participants deciding to receive distributions and the amount of their benefits increases.  There were no settlement charges during the years ended December 31, 2016, 2015 and 2014.

In December 2016, the Company announced that effective January 31, 2017, it will freeze the pay and service amounts used to calculate pension benefits for active employees who participated in the pension plan. Therefore, as of the Effective Date, active employees in the pension plan will not accrue additional benefits for future service and eligible compensation received.  As a result of these changes, the Company recognized a pre-tax curtailment income of $1,773 during the year ended December 31, 2016.

The estimated net actuarial loss that will be amortized from accumulated other comprehensive loss into net periodic pension benefits cost during the next twelve months is $345.

The following assumptions were used on a weighted average basis in computing the periodic benefit cost for the years ended December 31, 2016, 2015, and 2014:

	2016			2015			2014
Discount rate		4.75	%		4.25	%		5.25	%
Expected return on plan assets		7.00	%		7.00	%		7.00	%
Rate of compensation increase	Graded; 3.50		%	Graded; 3.50		%	Graded; 3.50		%
	to 8.00		%	to 8.00		%	to 8.00		%

The basis of the overall expected long-term rate of return on assets assumption is a forward-looking approach based on the current long-term capital market outlook assumptions of the assets categories in which the trust invests and the trust’s target asset allocation. At December 31, 2016, the assumed target asset allocation for the program is: 44% to 56% in equity securities, 34% to 46% in debt securities, and 6% to 14% in other securities. Using a mean-variance model to project returns over a 30-year horizon under the target asset allocation, the 35 to 65 percentile range of annual rates of return is 5.7% to 7.1%. The Company selected a rate from within this range of 7.00% for 2016 and 2015, which reflects the Company’s best estimate for this assumption based on the data described above, information on the historical returns on assets invested in the pension trust, and expected future conditions. This rate is net of both investment related expenses and a 0.15% reduction for other administrative expenses charged to the trust.

Plan Assets

Plan assets recorded at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. For level inputs and input definition, see Note 9.

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	6,276		$	-	$	6,276
Non-agency backed securities		-		715			-		715
Corporate obligations		-		7,243			-		7,243
Partnership/Joint venture		-		-			932		932
Limited Liability Corporations		-		98,188			-		98,188
Real estate		-		-			6,617		6,617
Registered investments		3,839		1,869			-		5,708
Common/Collective trusts		-		7,334			-		7,334
Hedge funds		-		4,581			-		4,581
Common stocks		1,515		1			-		1,516
Preferred stocks		107		12			-		119
Forward foreign currency contracts		-		(1	)		-		(1	)
Interest-bearing cash		2,224		-			-		2,224
Derivatives		-		27			-		27
	$	7,685	$	126,245		$	7,549	$	141,479

	2015
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	9,009		$	-	$	9,009
Non-agency backed securities		-		745			-		745
Corporate obligations		-		10,865			-		10,865
Partnership/Joint venture		-		-			567		567
Limited Liability Corporations		-		60,417			-		60,417
Real estate		-		-			5,929		5,929
Registered investments		6,224		5,927			-		12,151
Common/Collective trusts		-		16,479			-		16,479
Hedge funds		-		8,284			-		8,284
Common stocks		1,985		-			-		1,985
Preferred stocks		121		-			-		121
Forward foreign currency contracts		-		3			-		3
Interest-bearing cash		550		-			-		550
Derivatives		-		(28	)		-		(28	)
	$	8,880	$	111,701		$	6,496	$	127,077

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the year ended December 31, 2016 and 2015 is as follows:

	Government Obligations		Corporate Obligations		Partnership/ Joint Venture			Real Estate			Hedge Funds		Total
Beginning balance at December 31, 2014	$	.		.		1,097			6,197			-	$	7,294
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		103			384			-		487
Relating to assets sold during the period		-		-		(39	)		636			-		597
Purchases, issuances, and settlements		-		-		(594	)		(1,288	)		-		(1,882	)
Transfer in and/or out		-		-		-			-			-		-
Ending balance at December 31, 2015		-		-		567			5,929			-		6,496
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		19			501			-		520
Relating to assets sold during the period		-		-		1			72			-		73
Purchases, issuances, and settlements		-		-		345			324			-		669
Transfer in and/or out		-		-		-			(209	)		-		(209	)
Ending balance at December 31, 2016	$	-	$	-	$	932		$	6,617		$	-	$	7,549

The Company’s plan assets are invested in the National Retirement Trust. The National Retirement Trust was formed to provide financial and legal resources to help members of the BCBSA offer retirement benefits to their employees.

The investment program for the National Retirement Trust is based on the precepts of capital market theory that are generally accepted and followed by institutional investors, who by definition are long‑term oriented investors. This philosophy holds that:

· Increasing risk is rewarded with compensating returns over time, and therefore, prudent risk taking is justifiable for long-term investors.

· Risk can be controlled through diversification of asset classes and investment approaches, as well as diversification of individual securities.

· Risk is reduced by time, and over time the relative performance of different asset classes is reasonably consistent. Over the long-term, equity investments have provided and should continue to provide superior returns over other security types. Fixed-income securities can dampen volatility and provide liquidity in periods of depressed economic activity.  Lengthening duration of fixed income securities may reduce surplus volatility.

· The strategic or long-term allocation of assets among various asset classes is an important driver of long‑term returns.

· Relative performance of various asset classes is unpredictable in the short‑term and attempts to shift tactically between asset classes are unlikely to be rewarded.

Investments will be made for the sole interest of the participants and beneficiaries of the programs participating in the National Retirement Trust. Accordingly, the assets of the National Retirement Trust shall be invested in accordance with these objectives:

· To ensure assets are available to meet current and future obligations of the participating programs when due.

· To earn the maximum return that can be realistically achieved in the markets over the long‑term at a specified and controlled level of risk in order to minimize future contributions.

· To invest assets with consideration of the liability characteristics in order to better align assets and liabilities.

· To invest the assets with the care, skill, and diligence that a prudent person acting in a like capacity would undertake. In the process, the Administration of the Trust has the objective of controlling the costs involved with administering and managing the investments of the National Retirement Trust.

Cash Flows

The Company expects to contribute $4,000 to its pension program in 2017.

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

Year ending December 31
2017	$	8,253
2018		8,748
2019		9,047
2020		9,322
2021		9,314
2022 – 2026		49,252

Noncontributory Supplemental Pension Plan

In addition, the Company sponsors a noncontributory supplemental pension plan. This plan covers employees with qualified defined benefit retirement plan benefits limited by the U.S. Internal Revenue Code maximum compensation and benefit limits.  At December 31, 2016 and 2015, the Company has recorded a pension liability of $7,413 and $8,224, respectively.  The charge to accumulated other comprehensive loss related to the noncontributory pension plan at December 31, 2016 and 2015 amounted to $107 and $862, respectively, net of a deferred tax asset of $73 and $556, respectively.

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Catastrophe Loss Reserve and Trust Fund

12 Months Ended

Dec. 31, 2016

Catastrophe Loss Reserve and Trust Fund [Abstract]

Catastrophe Loss Reserve and Trust Fund

16. Catastrophe Loss Reserve and Trust Fund

In accordance with Chapter 25 of the Puerto Rico Insurance Code, as amended, TSP is required to record a catastrophe loss reserve. This catastrophe loss reserve is supported by a trust fund for the payment of catastrophe losses. The reserve increases by amounts determined by applying a contribution rate, not in excess of 5%, to catastrophe written premiums as instructed annually by the Commissioner of Insurance, unless the level of the reserve exceeds 8% of catastrophe exposure, as defined. The reserve also increases by an amount equal to the resulting return in the supporting trust fund and decreases by payments on catastrophe losses or authorized withdrawals from the trust fund. Additions to the catastrophe loss reserve are deductible for income tax purposes.

This trust may invest its funds in securities authorized by the Insurance Code, but not in investments whose value may be affected by hazards covered by the catastrophic insurance losses. The interest earned on these investments and any realized gains (loss) on investment transactions are part of the trust fund and are recorded as income (expense) of the Company. An amount equal to the investment returns is recorded as an addition to the trust fund.

The interest earning assets in this fund, which amounted to $47,630 and $46,221 as of December 31, 2016 and 2015, respectively, are to be used solely and exclusively to pay catastrophe losses covered under policies written in Puerto Rico.

TSP is required to contribute to the trust fund, if needed or necessary, on or before January 31 of the following year. Contributions are determined by a rate determined or established by the Commissioner of Insurance for the catastrophe policies written in that year. No contribution was required for 2016 and 2015 since the level of the catastrophe reserve exceeds 8% of the catastrophe exposure.

The amount in the trust fund may be withdrawn or released in the case that TSP ceases to underwrite risks subject to catastrophe losses. Also, authorized withdrawals are allowed when the catastrophe loss reserve exceeds 8% of the catastrophe exposure, as defined.

TSP retained earnings are restricted in the accompanying consolidated balance sheets by the total catastrophe loss reserve balance, which as of December 31, 2016 and 2015 amounted to $44,823 and $43,041, respectively.

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Stockholders' Equity

12 Months Ended

Dec. 31, 2016

Stockholders' Equity [Abstract]

Stockholders' Equity

17. Stockholders’ Equity

a. Common Stock

On November 12, 2015, the Company converted 1,426,721 issued and outstanding Class A shares into Class B common stock purchased pursuant to the provisions of the Articles of incorporation approved by Class A shareholders at the time of the Company’s Initial Public Offering.

b. Preferred Stock

Authorized capital stock includes 100,000,000 of preferred stock with a par value of $1.00 per share. As of December 31, 2016 and 2015, there are no issued and outstanding preferred shares.

c. Liquidity Requirements

As members of the BCBSA, the Company, TSS, and TSA are required by membership standards of this association to maintain liquidity as defined by BCBSA. That is, to maintain net worth exceeding the Company Action Level as defined in the National Association of Insurance Commissioners’ (NAIC) Risk-Based Capital for Insurers Model Act. The companies are in compliance with this requirement.

d. Dividends

As a holding company, the Company’s most significant assets are the common shares of its subsidiaries.  The principal sources of funds available to the Company are rental income and dividends from its subsidiaries, which are used to fund our debt service and operating expenses.

The Company is subject to the provisions of the General Corporation Law of Puerto Rico, which restricts the declaration and payment of dividends by corporations organized pursuant to the laws of Puerto Rico.  These provisions provide that Puerto Rico corporations may only declare dividends charged to their retained earnings or, in the absence of retained earnings, net profits of the fiscal year in which the dividend is declared and/or the preceding fiscal year.

The Company’s ability to pay dividends is dependent, among other factors, on its ability to collect cash dividends from its subsidiaries, which are subject to regulatory requirements, which may restrict their ability to declare and pay dividends or distributions.  In addition, an outstanding secured term loan restricts our ability to pay dividends in the event of default (see note 11).

The accumulated earnings of TSS, TSA, TSV, TSB and TSP are restricted as to the payment of dividends by statutory limitations applicable to domestic insurance companies. Under Puerto Rico insurance regulations, the regulated subsidiaries are permitted, without requesting prior regulatory approval, to pay dividends as long as the aggregate amount of all such dividends in any calendar year does not exceed the lesser of: (i) 10% of its surplus as of the end of the immediately preceding calendar year; or (ii) its statutory net gain from operations for the immediately preceding calendar year (excluding realized capital gains).  Regulated subsidiaries will be permitted to pay dividends in excess of the lesser of such two amounts only if notice of its intent to declare such a dividend and the amount thereof is filed with the Commissioner of Insurance and such dividend is not disapproved within 30 days of its filing. As of December 31, 2016, the dividends permitted to be distributed in 2016 by the regulated subsidiaries without prior regulatory approval from the Commissioner of Insurance amounted to approximately $43,000.  This amount excludes any dividend from TSA because as stated in note 14, we do not intend to repatriate earnings from this subsidiary nor do any transaction that would cause a reversal on an outside basis difference created as a result of the business combination of TSA and cumulative earnings of its Puerto Rico-based subsidiaries that are considered to be indefinitely reinvested.

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Stock Repurchase Programs

12 Months Ended

Dec. 31, 2016

Stock Repurchase Programs [Abstract]

Stock Repurchase Programs

18. Stock Repurchase Programs

The Company repurchases shares through open market transactions, in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended, under repurchase programs authorized by the Board of Directors.  Shares purchased under share repurchase programs are retired and returned to authorized and unissued status.

A summary of share repurchase programs in place during the three-year-period ended December 31, 2016 is as follows:

· In July 2013 the Company’s Board of Directors authorized a $11,500 repurchase program (2013 $11,500 stock repurchase program) of its Class B common stock.  This program was discontinued on October 28, 2014.

· In October 2014 the Company’s Board of Directors authorized a $50,000 repurchase program (2014 $50,000 share repurchase program) of its Class B common stock. This program was completed on October 7, 2015.

· In November 2015 the Company’s Board of Directors authorized a $25,000 repurchase program (2015 $25,000 share repurchase program) of its Class B common stock.  This program was completed on September 14, 2016.

The stock repurchase activity under stock repurchase programs for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	2016						2015						2014
	Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased
2015  $25,000 program		951,831	$	22.54	$	21,370		154,554	$	23.72	$	3,629		-	$	-	$	-
2014  $50,000 program		-		-		-		2,086,532		21.69		44,658		228,525		23.55		5,341
2013  $11,500 program		-		-		-		-		-		-		367,700		16.32		5,995
Total		951,831	$	22.54	$	21,370		2,241,086	$	21.87	$	48,287		596,225	$	20.28	$	11,336

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Comprehensive Income

12 Months Ended

Dec. 31, 2016

Comprehensive Income [Abstract]

Comprehensive Income

19. Comprehensive Income

The accumulated balances for each classification of other comprehensive income are as follows:

	Unrealized Gains on securities			Liability for Pension Benefits			Accumulated Other Comprehensive Income
Beginning balance at December 31, 2015	$	62,478		$	(36,855	)	$	25,623
Net current period change		14,761			15,728			30,489
Reclassification adjustments for gains and losses reclassified in income		(14,868	)		1,151			(13,717	)
Ending balance at December 31, 2016	$	62,371		$	(19,976	)	$	42,395

The related deferred tax effects allocated to each component of other comprehensive income in the accompanying consolidated statements of stockholders’ equity and comprehensive income in 2016, 2015 and 2014 are as follows:

	2016
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	18,357		$	(3,596	)	$	14,761
Less reclassification adjustment for gains and losses realized in income		(17,379	)		2,511			(14,868	)
Net change in unrealized gain		978			(1,085	)		(107	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		1,888			(737	)		1,151
Net change arising from assumptions and plan changes and experience		25,783			(10,055	)		15,728
Net change in liability for pension benefits		27,671			(10,792	)		16,879
Net current period change	$	28,649		$	(11,877	)	$	16,772

	2015
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	(25,765	)	$	3,153		$	(22,612	)
Less reclassification adjustment for gains and losses realized in income		(18,941	)		2,564			(16,377	)
Net change in unrealized gain		(44,706	)		5,717			(38,989	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		6,020			(2,348	)		3,672
Net change arising from assumptions and plan changes and experience		19,940			(7,776	)		12,164
Net change in liability for pension benefits		25,960			(10,124	)		15,836
Net current period change	$	(18,746	)	$	(4,407	)	$	(23,153	)

	2014
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	58,831		$	(8,161	)	$	50,670
Less reclassification adjustment for gains and losses realized in income		(18,231	)		3,444			(14,787	)
Net change in unrealized gain		40,600			(4,717	)		35,883
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		3,737			(1,457	)		2,280
Net change arising from assumptions and plan changes and experience		(35,271	)		13,755			(21,516	)
Net change in liability for pension benefits		(31,534	)		12,298			(19,236	)
Net current period change	$	9,066		$	7,581		$	16,647

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Share-Based Compensation

12 Months Ended

Dec. 31, 2016

Share-Based Compensation [Abstract]

Share-Based Compensation

20. Share-Based Compensation

In December 2007 the Company adopted the 2007 Incentive Plan (the Plan), which permits the Board to grant stock options, restricted stock awards and performance awards to eligible officers, directors and employees. The Plan authorizes the granting of up to 4,700,000 of Class B common shares of authorized but unissued stock. At December 31, 2016 and 2015, there were 1,333,093 and 1,677,395 shares available for the Company to grant under the Plan, respectively. Stock options can be granted with an exercise price at least equal to the stock’s fair market value at the grant date. The stock option awards vest in equal annual installments over 3 years and their expiration date cannot exceed 7 years. The restricted stock and performance awards are issued at the fair value of the stock on the grant date with vesting periods ranging from one to three years. Restricted stock awards vest in installments, as stipulated in each restricted stock agreement. Performance awards vest on the last day of the performance period, provided that at least minimum performance standards are achieved.

The fair value of each option award is estimated on the grant date using the Black‑Scholes option-pricing model that uses the weighted average assumptions in the following table. In absence of adequate historical data, the Company estimates the expected life of the option using the simplified method allowed by Staff Accounting Bulletin (SAB) No. 107. Since the Company was a newly public entity, expected volatility was computed based on the average historical volatility of similar entities with publicly traded shares. The risk-free rate for the expected term of the option was based on the U.S. Treasury zero-coupon bonds yield curve in effect at the time of grant.

Stock option activity during the year ended December 31, 2016 is as follows:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding balance at January 1, 2016		4,440		$	12.49
Exercised during the year		(4,440	)	$	12.49
Outstanding balance at December 31, 2016		-		$	-		N/A	$	-
Exercisable at December 31, 2016		-		$	-		N/A	$	-

No options were granted during the three years ended December 31 2016, 2015 and 2014.  There were 4,440, 12,913, and 199,002 exercised options during 2016, 2015 and 2014, respectively.  No cash was received from stock options exercises during the years ended December 31, 2016 and 2015.  During the years ended December 31, 2016, 2015 and 2014, 2,290, 7,235, and 174,090 shares, respectively, were repurchased and retired as a result of non-cash exercise of stock options.

A summary of the status of the Company’s nonvested restricted and performance shares as of December 31, 2016, and changes during the year ended December 31, 2016, are presented below:

	Restricted Awards					Performance Awards
	Number of Shares			Weighted Average Fair Value		Number of Shares			Weighted Average Exercise Price
Outstanding balance at January 1, 2016		156,331		$	19.45		495,005		$	17.84
Granted		110,181			23.78		234,121			23.85
Lapsed		(99,276	)		20.14		(89,171	)		16.17
Forfeited (due to termination)		(5,412	)		20.27		(60,218	)		16.67
Forfeited (due to performance payout less than 100%)		-			-		(121,542	)		18.61
Outstanding balance at December 31, 2016		161,824		$	21.94		458,195		$	21.44

The weighted average grant date fair value of restricted shares granted during the year 2016, 2015 and 2014 were $23.78, $20.33, and $16.46, respectively. Total fair value of restricted stock vested during the year ended December 31, 2016, 2015 and 2014 was $2,335, $3,608 and $1,146, respectively.

At December 31, 2016 there was $6,785 of total unrecognized compensation cost related to nonvested share‑based compensation arrangements granted under the Plan. That cost is expected to be recognized over a weighted average period of 1.02 years. The Company currently uses authorized and unissued Class B common shares to satisfy share award exercises.

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Net Income Available to Stockholders and Basic Net Income per Share

12 Months Ended

Dec. 31, 2016

Net Income Available to Stockholders and Basic Net Income per Share [Abstract]

Net Income Available to Stockholders and Basic Net Income per Share

21. Net Income Available to Stockholders and Basic Net Income per Share

The following table sets forth the computation of basic and diluted earnings per share for the three-year period ended December 31:

	2016		2015		2014
Numerator for earnings per share
Net income attributable to TSM available to stockholders	$	17,438	$	52,121	$	65,660
Denominator for basic earnings per share –
Weighted average of common shares		24,454,435		25,674,079		27,102,127
Effect of dilutive securities		56,658		87,662		86,705
Denominator for diluted earnings per share		24,511,093		25,761,741		27,188,832
Basic net income per share attributable to TSM	$	0.71	$	2.03	$	2.42
Diluted net income per share attributable to TSM	$	0.71	$	2.02	$	2.41

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Commitments

12 Months Ended

Dec. 31, 2016

Commitments [Abstract]

Commitments

22. Commitments

The Company leases its regional offices, certain equipment, and warehouse facilities under non-cancelable operating leases. Minimum annual rental commitments at December 31, 2016 under existing agreements are summarized as follows:

Year ending December 31
2017	$	4,213
2018		3,936
2019		3,565
2020		2,345
2021		3,777
Total	$	17,836

Rental expense for 2016, 2015, and 2014 was $7,613, $7,730, and $8,738 respectively.

Pursuant to the provisions of the Puerto Rico Insurance Code and Regulations, TSP is a member of the Compulsory Vehicle Liability Insurance Joint Underwriting Association (the Association).  As a participant, TSP shares the risk, proportionately with other members, based on a formula established by the Puerto Rico Insurance Code, of the results and financial condition of the Association, and accordingly, may be subject to assessments to cover obligations of the Association or may receive refund distributions for good experience.  In December 2015, the Association declared an extraordinary dividend to its members for $21,000 subject to a special tax rate of 15% as allowed by Act No. 201 of December 7, 2015.   The dividend was received net of tax in three installments in 2016.  During the year ended December 31, 2015, TSP recorded a special distribution of $1,672, net of tax, which is included as other income in the accompanying consolidated statements of earnings.

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Contingencies

12 Months Ended

Dec. 31, 2016

Contingencies [Abstract]

Contingencies

23. Contingencies

The Company’s business is subject to numerous laws and regulations promulgated by Federal, Puerto Rico, USVI, Costa Rica, BVI, and Anguilla governmental authorities. Compliance with these laws and regulations can be subject to government review and interpretation, as well as regulatory actions unknown and unasserted at this time. The Commissioner of Insurance of Puerto Rico, as well as other Federal, Puerto Rico, USVI, Costa Rica, BVI, and Anguilla government authorities, regularly make inquiries and conduct audits concerning the Company's compliance with such laws and regulations. Penalties associated with violations of these laws and regulations may include significant fines and exclusion from participating in certain publicly funded programs and may require the Company to comply with corrective action plans or changes in our practices.

As of December 31, 2016, the Company is involved in various legal actions arising in the ordinary course of business. The Company is also defendant in various other litigations and proceedings, some of which are described below.  Where the Company believes that a loss is both probable and estimable, such amounts have been recorded. Although the Company believes the estimates of such losses are reasonable, these estimates could change as a result of further developments in these matters. In other cases, it is at least reasonably possible that the Company may incur a loss related to one or more of the mentioned pending lawsuits or investigations, but the Company is unable to estimate the range of possible loss which may be ultimately realized, either individually or in the aggregate, upon their resolution.  The outcome of legal proceedings is inherently uncertain and pending matters for which accruals have not been established have not progressed sufficiently to enable us to estimate a range of possible loss, if any.  Given the inherent unpredictability of these matters, it is possible that an adverse outcome in one or more of these matters could have a material adverse effect on the consolidated financial condition, operating results and/or cash flows of the Company.

Additionally, we may face various potential litigation claims that have not been asserted to date, including claims from persons purporting to have rights to acquire shares of the Company on favorable terms pursuant to agreements previously entered by our predecessor managed care subsidiary, Seguros de Servicios de Salud de Puerto Rico, Inc. (SSS), with physicians or dentists who joined our provider network to sell such new provider shares of SSS at a future date (Share Acquisition Agreements) or to have inherited such shares notwithstanding applicable transfer and ownership restrictions.

Claims by Heirs of Former Shareholders

The Company and Triple-S Salud, Inc. (TSS) are defending eight individual lawsuits, all filed in state court, from persons who claim to have inherited a total of 113 shares of the Company or one of its predecessors or affiliates (before giving effect to the 3,000-for-one stock split). While each case presents unique facts and allegations, the lawsuits generally allege that the redemption of the shares by the Company pursuant to transfer and ownership restrictions contained in the Company's (or its predecessors' or affiliates') articles of incorporation and bylaws was improper.

In one of these cases, entitled Vera Sánchez, et al, v. Triple-S, filed on July 31, 2008, the plaintiffs argued that the redemption of shares was fraudulent and was not subject to the two-year statute of limitations contained in the local securities law. The Puerto Rico Court of First Instance dismissed the claim and determined it was time barred under the local securities law. On January 27, 2012, the Puerto Rico Court of Appeals upheld the dismissal. On October 1, 2013, the Puerto Rico Supreme Court reversed the dismissal, holding that the two-year statute of limitations contained in the local securities law did not apply and returning the case to the Court of First Instance. On December 16, 2015, the Company filed a motion for summary judgement and on November 29, 2016, the Court of First Instance held that plaintiff’s opposition to Triple-S’ motion for summary judgment did not comply with the Rules of Civil Procedures.  Triple-S has requested the Court to consider its motion for summary judgment as unopposed. The parties are awaiting further proceedings.

In the second case, entitled Olivella Zalduondo, et al, v. Seguros de Servicios de Salud, et al, filed on September 21, 2010, the Puerto Rico’s Court of First Instance granted the Company’s motion to dismiss on grounds that the complaint was time-barred under the two-year statute of limitations of the local securities laws. On appeal, the Court of Appeals affirmed the decision of the lower court. On January 8, 2013, the Puerto Rico Supreme Court ruled that the applicable statute of limitations is the fifteen-year period for collection of monies of the Puerto Rico Civil Code.  On January 28, 2013, the Company filed a motion for reconsideration which was subsequently denied. On March 26, 2013, plaintiffs amended their complaint, which was answered by the Company on April 16, 2013.  Discovery is ongoing.

In the third case, entitled Heirs of Dr. Juan Acevedo, et al, v. Triple-S Management Corporation, et al, filed on March 27, 2008, the Puerto Rico Court of First Instance denied our motion for summary judgment based on its determination that there are material issues of fact in controversy. In response to our appeal, the Puerto Rico Court of Appeals confirmed the decision of the Puerto Rico Court of First Instance and denied a subsequent plea for reconsideration. Both parties have filed motions for summary judgment and, consequently, their respective oppositions. The parties are awaiting the court’s decision on their respective motions for summary judgment.

The fourth case, entitled Montilla López, et al, v. Seguros de Servicios de Salud, et al, was filed on November 29, 2011 in the Puerto Rico Court of First Instance. The Company filed a motion to dismiss on the grounds that the claim is time barred under the local securities laws, which was denied by the court on January 24, 2013.  The parties have filed their respective motions for summary judgment and are awaiting further proceedings.

The fifth case, entitled Cebollero Santamaría v. Triple-S Salud, Inc., et al, was filed on March 26, 2013 in the Puerto Rio Court of First Instance.  On October 29, 2013, the Company filed a motion for summary judgment on the grounds that the claim is time-barred under the fifteen-year statute of limitations of the Puerto Rico Civil Code for collection of monies and, in the alternative, that plaintiff failed to state a claim for which relief can be granted. Said motion was denied by the court.  On November 2, 2015, the Company filed a Writ of Certiorari with the Puerto Rico Court of Appeals, which was denied on March 8, 2016.  On March 23, 2016, the Company filed a request for reconsideration with the Puerto Rico Court of Appeals, which was denied on April 28, 2016.  Accordingly, on May 31, 2016, the Company filed a Writ of Certiorari with the Supreme Court of Puerto Rico.  The same was denied on September 23, 2016. The Company filed a motion for reconsideration before the Puerto Rico Supreme Court on October 11, 2016. The Supreme Court denied the reconsideration on December 2, 2016.  The Company has filed a second and final reconsideration motion which is still pending adjudication.

The sixth case, entitled Irizarry Antonmattei, et al, v. Seguros de Servicios de Salud, et al, was filed on April 16, 2013 in the Puerto Rico Court of First Instance.. On November 5, 2013, the Company moved to dismiss the first amended complaint and On May 16, 2014, plaintiffs filed a motion for summary judgment, which the Company opposed on May 28, 2014. On June 16, 2014, the court ordered plaintiffs to file a memorandum of law and struck plaintiff’s motion for summary judgment. On September 18, 2014, the court denied our motion to dismiss the amended complaint. On September 29, 2014, the Company filed a motion for reconsideration, which was denied by the court on November 4, 2014.  On December 4, 2014, the Company filed a petition of Writ of Certiorari with the Puerto Rico Court of Appeals, which was denied on April 1, 2015.  A status conference is scheduled for March 16, 2017. Discovery is ongoing.

The seventh case, entitled Allende Santos, et al, v. Triple-S Salud, et al, was filed on March 28, 2014 in the Puerto Rico Court of First Instance. On July 2, 2014, the Company filed its response. Discovery is ongoing.

The eighth case, entitled Ruiz de Porras, et al, v. Triple-S Salud, Inc., was filed on January 7, 2016 in the Puerto Rico Courts of First Instance. On March 28, 2016, the Company filed its response. Plaintiffs and the Company have filed various motions with the court and are awaiting further proceedings.

Management believes these claims are time barred under one or more statutes of limitations and will vigorously defend them on these grounds; however, as a result of the Puerto Rico Supreme Court’s decision to deny the applicability of the statute of limitations contained in the local securities law, some of these claims will likely be litigated on their merits.

Joint Underwriting Association Litigations

On August 19, 2011, plaintiffs, purportedly a class of motor vehicle owners, filed an action in the United States District Court for the District of Puerto Rico against the Puerto Rico Joint Underwriting Association (JUA) and 18 other defendants, including Triple-S Propiedad (TSP), alleging violations under the Puerto Rico Insurance Code, the Puerto Rico Civil Code, the Racketeer Influenced and Corrupt Organizations Act (RICO) and the local statute against organized crime and money laundering. JUA is a private association created by law to administer a compulsory public liability insurance program for motor vehicles in Puerto Rico (CLI). As required by its enabling act, JUA is composed of all the insurers that underwrite private motor vehicle insurance in Puerto Rico and exceed the minimum underwriting percentage established in such act. TSP is a member of JUA.

In this lawsuit, entitled Noemí Torres Ronda, et al v. Joint Underwriting Association, et al., plaintiffs allege that the defendants illegally charged and misappropriated a portion of the CLI premiums paid by motor vehicle owners in violation of the Puerto Rico Insurance Code. Specifically, they claim that because the defendants did not incur in acquisition or administration costs allegedly totaling 12% of the premium dollar, charging for such costs constitutes the illegal traffic of premiums. Plaintiffs also claim that the defendants, as members of JUA, violated RICO through various inappropriate actions designed to defraud motor vehicle owners located in Puerto Rico and embezzle a portion of the CLI premiums for their benefit.

Plaintiffs seek the reimbursement of funds for the class amounting to $406,600 treble damages under RICO, and equitable relief, including a permanent injunction and declaratory judgment barring defendants from their alleged conduct and practices, along with costs and attorneys’ fees. Discovery has been completed.

Since 2011, TSP has been defending this claim and, jointly with other defendants, has filed several pleas in connection with the certification of the class and the dismissal of the claim. On December 17, 2015, three defendants filed a joint motion informing the court that said defendants are conducting negotiations to settle the claim and requested a 60-day period in other to continue the negotiations.  Subsequently, the term to continue negotiations was extended until April 17, 2016. On April 22, 2016, plaintiff and the negotiating defendants filed a stipulation of settlement and release which is subject to approval of the court. TSP and the non-settling defendants have objected the filed settlement. Procedures are ongoing.

In re Blue Cross Blue Shield Antitrust Litigation

TSS is a co-defendant with multiple Blue Plans and the Blue Cross Blue Shield Association (BCBSA) in a multi-district class action litigation entitled In re Blue Cross Blue Shield Association Antitrust Litigation, filed on July 24, 2012. The plaintiffs allege that the exclusive service area (ESA) requirements of the Primary License Agreements with the Blue Plans violate antitrust laws. The plaintiffs in these suits seek monetary awards and, in some instances, injunctive relief barring ESAs. Those cases have been centralized in the United States District Court for the Northern District of Alabama. Prior to centralization, motions to dismiss were filed by several plans, including TSS. The parties have filed several pleas and presented their position in argumentative hearings before the court in connection with the motion to dismiss, which was ultimately dismissed without prejudice by the court. On April 6, 2015, plaintiffs filed suit in the United States District Court of Puerto Rico, which we believe does not preclude TSS’ jurisdictional arguments. The Company has joined BCBSA in vigorously contesting these claims. Discovery is ongoing.

Claims Relating to the Provision of Health Care Services

TSS is a defendant in several claims for collection of monies in connection with the provision of health care services. Among them are individual complaints filed before ASES by six community health centers alleging TSS breached their contracts with respect to certain capitation payments and other monetary claims. Such claims have an aggregate value of approximately $9,600. Discovery is ongoing, and given the early stage of the cases, the Company cannot assess the probability of an adverse outcome or the reasonable financial impact that any such outcome may have on the Company. TSS believes many of these complaints are time-barred and will continue to conduct a vigorous defense.

On April 17, 2015, ASES notified the Company of a complaint from a medical service provider demanding payment amounting to $5,073.  Claimant alleges that TSS did not pay the claims, paid them incorrectly, or recovered payments from the provider for which TSS did not have the right. TSS answered the complaint and counterclaimed.  TSS denies any wrongdoing and will continue to defend this matter vigorously.

On January 12, 2015, American Clinical Solutions LLC, a limited liability company that provides clinical laboratory services filed a complaint in Florida state court alleging that Triple-S Management (TSM) and TSS failed to pay certain clinical laboratory services provided to Blue Cross Blue Shield members. TSS and TSM have filed a motion to dismiss alleging lack of jurisdiction. TSM and TSS also requested a transfer of the case to Puerto Rico. Plaintiff has requested jurisdictional discovery, which is ongoing. The claim amounts to $5,000. TSS and TSM will continue to vigorously oppose this claim.

ASES Audits

The Company is subject to numerous audits in connection with the provision of services to private and governmental entities.  These audits may include numerous aspects of our business, including claim payment practices, contractual obligations, service delivery, third-party obligations, and business practices, among others.  Deficiencies in audits could have a material adverse effect on our reputation and business, including termination of contracts, significant increases in the cost of managing and remediating deficiencies, payment of contractual penal clauses, and others, any of which could have a material and adverse effect on our results of operations, financial position and cash flows.

On July 2, 2014, ASES notified TSS that the results of an audit conducted in connection with the government health plan contract for several periods between October 2005 to September 2013, reflected overpayment of premiums made to TSS pursuant to prior contracts with ASES in the amount of $7,900. The alleged overpayments were related to duplicated payments or payments made for deceased members, and requested the reimbursement of the alleged overpayment. TSS contends that ASES’ request for reimbursement has no merits on several grounds, including a 2011 settlement between both parties covering the majority of the amount claimed by ASES, and that ASES, under the terms of the contracts, was responsible for certifying the membership.  On March 24, 2015, the court ruled that the scope of the 2011 settlement agreement did not preclude ASES from recovering “future claims” including the alleged improper payments. After the denial of a subsequent motion for reconsideration and a petition for a Writ of Certiorari by the Puerto Rico Court of Appeals, on January 21, 2016, TSS filed a Writ of Certiorari with the Supreme Court of Puerto Rico.  TSS also amended its claim to include the Puerto Rico Health Department (PRHD), as it asserts the PRHD is an indispensable party for the resolution of this matter.  With this amendment, TSS seeks payment of approximately $5,000, since the premiums paid to TSS should have been higher than what ASES actually paid given the additional risk assumed by TSS.  The matter is currently being addressed before a special commissioner assigned by the court. The Company will continue to conduct a vigorous defense of this matter.

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Statutory Accounting

12 Months Ended

Dec. 31, 2016

Statutory Accounting [Abstract]

Statutory Accounting

24. Statutory Accounting

TSS, TSA, TSV and TSP (collectively known as the regulated subsidiaries) are regulated by the Commissioner of Insurance. The regulated subsidiaries are required to prepare financial statements using accounting practices prescribed or permitted by the Commissioner of Insurance, which uses a comprehensive basis of accounting other than GAAP. Specifically, the Commissioner of Insurance has adopted the NAIC’s Statutory Accounting Principles (NAIC SAP) as the basis of its statutory accounting practices, as long as they do not contravene the provisions of the Puerto Rico Insurance Code, its regulations and the Circular Letters issued by the Commissioner of Insurance. The Commissioner of Insurance may permit other specific practices that may deviate from prescribed practices and NAIC SAP. Statutory accounting principles that are established by state laws and permitted practices mandated by the Commissioner of Insurance may cause the statutory capital and surplus of the regulated subsidiaries to differ from that calculated under the NAIC SAP.

Prescribed statutory accounting practices in Puerto Rico allow TSP to disregard a deferred tax liability resulting from additions to the catastrophe loss reserve trust fund that would otherwise be required under NAIC SAP. The use of prescribed and permitted accounting practices, both individually and in the aggregate, did not change significantly the combined statutory capital and surplus that would have been reported following NAIC SAP, which as of December 31, 2016 and 2015 is approximately 1.3% and 1.1%, respectively, lower than the combined reported statutory capital and surplus.

The regulated subsidiaries are required by the NAIC and the Commissioner of Insurance to submit risk-based capital (RBC) reports following the NAIC’s RBC Model Act and accordingly, are subject to certain regulatory actions if their capital levels do not meet minimum specific RBC requirements.  RBC is a method developed by the NAIC to determine the minimum amount of statutory capital appropriate for an insurance company to support its overall business operations in consideration of its size and risk profile. The RBC is calculated by applying capital requirement factors to various assets, premiums and reserve items. The factor is higher for those items with greater underlying risk and lower for less risky items. The adequacy of an organization’s actual capital can then be measured by a comparison to its RBC as determined by the formula.

The RBC Model Act requires increasing degrees of regulatory oversight and intervention as an organization’s risk-based capital declines. The level of regulatory oversight ranges from requiring organizations to inform and obtain approval from the domiciliary insurance commissioner of a comprehensive financial plan for increasing its RBC, to mandatory regulatory intervention requiring an insurance company to be placed under regulatory control, in a rehabilitation or liquidation proceeding.

The Commissioner of Insurance adopted in 2009 an RBC policy that requires that the regulated entities maintain statutory reserves at or above the “Company Action Level,” in order to avoid regulatory monitoring and intervention. The company action level is currently set at 200% of the RBC for the entities within our Managed Care segment and 300% of the RBC for entities within our Property and Casualty and Life Insurance segments. As of December 31, 2016 all regulated subsidiaries comply with minimum statutory reserve requirements, except for TSA for which we expect to remediate and implement corrective actions plans to comply with such requirements. As of December 31, 2015 all regulated subsidiaries comply with minimum statutory reserve requirements.

The following table sets forth the combined net admitted assets, capital and surplus, RBC requirement, which is our statutory capital and surplus requirement, and net income for the regulated subsidiaries at December 31, 2016, 2015 and 2014:

(dollar amounts in millions)	2016		2015		2014
Net admitted assets	$	1,829	$	1,881	$	1,734
Capital and surplus		638		691		659
RBC requirement		278		301		209
Net income		24		73		88

As more fully described in note 16, a portion of the accumulated earnings and admitted assets of TSP are restricted by the catastrophe loss reserve and the trust fund balance as required by the Insurance Code.  The total catastrophe loss reserve and trust fund amounted to $44,823 and $47,630 as of December 31, 2016, respectively. The total catastrophe loss reserve and trust fund amounted to $43,041 and $46,221 as of December 31, 2015, respectively.  In addition, the admitted assets of the regulated subsidiaries are restricted by the investments deposited with the Commissioner of Insurance to comply with requirements of the Insurance Code (see note 3).  Investments with an amortized cost of $5,358 and $5,136 (fair value of $5,788 and $5,276) at December 31, 2016 and 2015, respectively, were deposited with the Commissioner of Insurance. As a result, the combined restricted assets for our regulated subsidiaries were $52,988 and $51,357 as of December 31, 2016 and 2015, respectively.

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Supplementary Information on Cash Flow Activities

12 Months Ended

Dec. 31, 2016

Supplementary Information on Cash Flow Activities [Abstract]

Supplementary Information on Cash Flow Activities

25. Supplementary Information on Cash Flow Activities

	2016			2015			2014
Supplementary information
Noncash transactions affecting cash flow activities
Change in net unrealized (gain) loss on securities available for sale, including deferred income tax (asset)/liability of $1,085, $(5,717), and $4,717 in 2016, 2015, and 2014,respectively	$	107		$	38,989		$	(35,883	)
Change in liability for pension benefits, and deferred income tax (asset)/liability of $10,792, $10,124, $(12,298), in 2016, 2015, and 2014, respectively	$	(16,879	)	$	(15,836	)	$	19,236
Repurchase and retirement of common stock	$	(56	)	$	(182	)	$	(3,049	)
Exercise of stock options	$	55		$	179		$	2,885
Unsettled sales	$	-		$	-		$	10,456
Other
Income taxes paid	$	11,549		$	6,437		$	16,069
Interest paid	$	7,635		$	4,792		$	5,764

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Segment Information

12 Months Ended

Dec. 31, 2016

Segment Information [Abstract]

Segment Information

26. Segment Information

The operations of the Company are conducted principally through three reportable business segments: Managed Care, Life Insurance, and Property and Casualty Insurance.  Reportable business segments were identified according to the type of insurance products offered and consistent with the information provided to the chief operating decision maker. These segments and a description of their respective operations are as follows:

· Managed Care segment – This segment is engaged in the sale of managed care products to the Commercial, Medicare and Medicaid market sectors.  The Commercial accounts sector includes corporate accounts, U.S. federal government employees, individual accounts, local government employees, and Medicare supplement. The following represents a description of the major contracts by sector:

– The segment is a qualified contractor to provide health coverage to federal government employees within Puerto Rico. Earned premiums revenue related to this contract amounted to $163,556, $155,821, and $152,659 for the three-year period ended December 31, 2016, 2015, and 2014, respectively (see note 12).

– Under its commercial business, the segment also provides health coverage to certain employees of the Commonwealth of Puerto Rico and its instrumentalities. Earned premium revenue related to such health plans amounted to $29,475, $30,607, and $37,748 for the three-year period ended December 31, 2016, 2015, and 2014, respectively.

– The segment provides services through its Medicare health plans pursuant to a limited number of contracts with CMS. Earned premium revenue related to the Medicare business amounted to $1,023,904, $1,097,657, and $1,013,746 for the three-year period ended December 31, 2016, 2015, and 2014, respectively.

– The segment also participates in the Medicaid program to provide health coverage to medically indigent citizens in Puerto Rico, as defined by the laws of the government of Puerto Rico.  We served all eight service regions on an administrative service only basis (ASO) until March 31, 2015.  Administrative service fees for each of the years in the two-year period ended December 31, 2015, and 2014 amounted to $24,266, and $95,908, respectively.  Beginning on April 1, 2015, the segment began providing managed care services on a fully-insured basis, earned premium revenue related to this business amounted to $783,231, and $607,216 for the periods ended December 31, 2016, and 2015.

· Life Insurance segment – This segment offers primarily life and accident and health insurance coverage, and annuity products. The premiums for this segment are mainly subscribed through an internal sales force and a network of independent brokers and agents.

· Property and Casualty Insurance segment –The predominant insurance insurance products of this segment commercial package, commercial auto, and personal package. The premiums for this segment are originated through a network of independent insurance agents and brokers. Agents or general agencies collect the premiums from the insureds, which are subsequently remitted to the segment, net of commissions. Remittances are generally due 60 days after the closing date of the general agent’s account current.

The Company evaluates performance based primarily on the operating revenues and operating income of each segment.  Operating revenues include premiums earned (net), administrative service fees and net investment income.  Operating costs include claims incurred and operating expenses.  The Company calculates operating income or loss as operating revenues less operating costs.

The accounting policies for the segments are the same as those described in the summary of significant accounting policies included in the notes to consolidated financial statements.  The financial data of each segment is accounted for separately; therefore no segment allocation is necessary. However, certain operating expenses are centrally managed, therefore requiring an allocation to each segment. Most of these expenses are distributed to each segment based on different parameters, such as payroll hours, processed claims, or square footage, among others. In addition, some depreciable assets are kept by one segment, while allocating the depreciation expense to other segments. The allocation of the depreciation expense is based on the proportion of assets used by each segment. Certain expenses are not allocated to the segments and are kept within TSM’s operations.

The following tables summarize the operations by operating segment for each of the years in the three‑year period ended December 31, 2016:

	2016			2015			2014
Operating revenues
Managed care
Premiums earned, net	$	2,647,169		$	2,548,270		$	1,894,791
Fee revenue		17,843			44,705			119,302
Intersegment premiums/fee revenue		5,918			5,860			5,681
Net investment income		15,102			11,779			15,010
Total managed care		2,686,032			2,610,614			2,034,784
Life
Premiums earned, net		156,140			147,864			142,245
Intersegment premiums		716			251			240
Net investment income		24,877			24,457			23,717
Total life		181,733			172,572			166,202
Property and casualty
Premiums earned, net		87,332			87,020			91,530
Intersegment premiums		613			613			613
Net investment income		8,891			8,706			8,600
Total property and casualty		96,836			96,339			100,743
Other segments*
Intersegment service revenues		9,907			10,863			9,100
Operating revenues from external sources		3,563			3,875			4,234
Total other segments		13,470			14,738			13,334
Total business segments		2,978,071			2,894,263			2,315,063
TSM operating revenues from external sources		19			53			95
Elimination of intersegment premiums		(7,247	)		(6,724	)		(6,534	)
Elimination of intersegment service revenue		(9,907	)		(10,863	)		(9,100	)
Other intersegment eliminations		(78	)		23			116
Consolidated operating revenues	$	2,960,858		$	2,876,752		$	2,299,640

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

	2016			2015			2014
Operating (loss) income
Managed care	$	(36,777	)	$	20,514		$	31,445
Life		21,458			20,012			22,561
Property and casualty		12,074			8,273			10,044
Other segments*		(1,784	)		(301	)		(4,440	)
Total business segments		(5,029	)		48,498			59,610
TSM operating revenues from external sources		19			53			95
TSM unallocated operating expenses		(9,739	)		(18,858	)		(14,571	)
Elimination of TSM charges		9,522			9,623			9,717
Consolidated operating (loss) income		(5,227	)		39,316			54,851
Consolidated net realized investment gains		17,379			18,941			18,231
Consolidated interest expense		(7,635	)		(8,169	)		(9,274	)
Consolidated other income, net		6,569			7,043			2,243
Consolidated income before taxes	$	11,086		$	57,131		$	66,051

		2016		2015		2014
Depreciation and amortization expense
Managed care	$	11,114	$	13,268	$	17,935
Life		1,030		1,094		1,394
Property and casualty		544		673		994
Other segments*		645		556		3,264
Total business segments		13,333		15,591		23,587
TSM depreciation expense		787		788		813
Consolidated depreciation and amortization expense	$	14,120	$	16,379	$	24,400

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

	2016			2015			2014
Assets
Managed care	$	1,013,872		$	1,034,725		$	975,999
Life		816,920			770,721			764,268
Property and casualty		349,159			350,514			362,620
Other segments*		26,034			25,629			22,682
Total business segments		2,205,985			2,181,589			2,125,569
Unallocated amounts related to TSM
Cash, cash equivalents, and investments		17,033			12,304			44,157
Property and equipment, net		22,380			23,219			20,415
Other assets		21,646			31,732			37,851
		61,059			67,255			102,423
Elimination entries – intersegment receivables and others		(48,045	)		(42,699	)		(82,256	)
Consolidated total assets	$	2,218,999		$	2,206,145		$	2,145,736

		2016			2015			2014
Significant noncash items
Net change in unrealized gain (loss) on securities available for sale
Managed care	$	104		$	(15,505	)	$	6,055
Life		2,659			(13,005	)		22,349
Property and casualty		(2,984	)		(10,482	)		7,789
Other segments*		105			(10	)		-
Total business segments		(116	)		(39,002	)		36,193
Amount related to TSM		9			13			(310	)
Consolidated net change in unrealized gain (loss) on securities available for sale	$	(107	)	$	(38,989	)	$	35,883

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

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Subsequent Events

12 Months Ended

Dec. 31, 2016

Subsequent Events [Abstract]

Subsequent Events

27. Subsequent Events

The Company evaluated subsequent events through the date the financial statements were issued.  No events, other than those described in these notes, have occurred that require adjustment or disclosure pursuant to current Accounting Standard Codification.

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Schedule II - Condensed Financial Information of Triple-S Management Corporation

12 Months Ended

Dec. 31, 2016

Schedule II - Condensed Financial Information of Triple-S Management Corporation

Schedule II Condensed Financial Information of Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

(Registrant)

Balance Sheets

(in thousands)

	As of December 31,
	2016		2015
Assets:
Cash and cash equivalents	$	14,153	$	12,304
Securities available for sale, at fair value:
Equity Securities (cost of $2,869 in 2016)		2,880		-
Investment in subsidiaries		866,010		866,712
Notes receivable and accrued interest from subsidiaries		47,153		48,858
Due from subsidiaries		5,255		3,730
Deferred tax assets		14,976		26,767
Other assets		29,050		28,138
Total assets	$	979,477	$	986,509
Liabilities:
Notes payable and accrued interest to subsidiary		16,475		15,720
Due to subsidiaries		22,661		11,860
Long-term borrowings		35,085		36,827
Liability for pension benefits		30,892		62,945
Other liabilities		11,201		11,631
Total liabilities		116,314		138,983
Stockholders' equity:
Common stock, class A		951		951
Common stock, class B		23,321		24,048
Additional paid-in-capital		65,592		83,438
Retained earnings		730,904		713,466
Accumulated other comprehensive income, net		42,395		25,623
Total stockholders' equity		863,163		847,526
Total liabilities and stockholders' equity	$	979,477	$	986,509

The accompanying notes are an integral part of these condensed financial statements

Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

Triple-S Management Corporation

Statements of Earnings

(in thousands)

	2016			2015			2014
Investment income	$	19		$	53		$	95
Other revenues		11,644			12,015			11,034
Total revenues		11,663			12,068			11,129
Operating expenses:
General and administrative expenses		9,739			18,858			14,571
Interest expense		1,763			2,435			2,998
Total operating expenses		11,502			21,293			17,569
Income (loss) before income taxes		161			(9,225	)		(6,440	)
Income tax expense (benefit)		1,183			(1,071	)		(162	)
Loss of parent company		(1,022	)		(8,154	)		(6,278	)
Equity in net income of subsidiaries		18,460			60,275			71,938
Net income	$	17,438		$	52,121		$	65,660

The accompanying notes are an integral part of these condensed financial statements

Triple-S Management Corporation

Schedule II

Condensed Financial Information of Triple-S Management Corporation

(Registrant)

Statements of Cash Flows

(in thousands)

	2016			2015			2014
Net income	$	17,438		$	52,121		$	65,660
Adjustment to reconcile net income to net cash provided by operating activities:
Equity in net income of subsidiaries		(18,460	)		(60,275	)		(71,938	)
Depreciation and amortization		839			872			863
Shared- based compensation		2,799			8,290			2,371
Deferred income tax expense (benefit)		1,042			(1,227	)		(137	)
Dividends received from subsidiaries		19,000			47,000			36,600
Other		-			42			34
Changes in assets and liabilities:
Accrued interest from subsidiaries, net		(646	)		(1,046	)		(1,614	)
Due from subsidiaries		(1,525	)		4,869			(2,831	)
Other assets		(1,751	)		(1,953	)		1,004
Due to subsidiaries		10,801			(2,162	)		5,654
Other liabilities		(4,812	)		4,614			(1,948	)
Net cash provided by operating activities		24,725			51,145			33,718
Cash flows from investing activities:
Acquisition of investment in securities classified as available for sale		(2,869	)		-			(27,572	)
Proceeds from sale and maturities of investment in securities classified as available for sale		-			27,500			28,016
Collection of note receivable from subsidiary		4,500			9,000			9,250
Issuance of note receivable to subsidiary		(1,394	)		(2,369	)		(13,131	)
Capital contribution to subsidiary		-			-			(908	)
Net acquisition of property and equipment		-			(3,676	)		-
Net cash provided by (used in) investing activities		237			30,455			(4,345	)
Cash flow from financing activities:
Repayments of long-term borrowings		(1,742	)		(37,640	)		(1,640	)
Repurchase of common stock		(21,371	)		(48,287	)		(11,337	)
Net cash used in financing activities		(23,113	)		(85,927	)		(12,977	)
Net increase (decrease) in cash and cash equivalents		1,849			(4,327	)		16,396
Cash and cash equivalents, beginning of year		12,304			16,631			235
Cash and cash equivalents, end of year	$	14,153		$	12,304		$	16,631

The accompanying notes are an integral part of these condensed financial statements

Triple-S Management Corporation(Parent Company Only)Notes to Condensed Financial Statements December 31, 2016, 2015 and 2014

(dollar amounts in thousands)

The accompanying notes to the condensed financial statements should be read in conjunction with the consolidated financial statements and the accompanying notes thereto included in Item 15 to the Annual Report on Form 10-K.

(1) For purposes of these condensed financial statements, Triple‑S Management Corporation’s (the Company or TSM) investment in its wholly owned subsidiaries is recorded using the equity method of accounting.

(2) Significant Accounting Policies

The significant accounting policies followed by the Company are set forth in the notes to the consolidated financial statements and the accompanying notes thereto.  Refer to Item 15 to the Annual Report on Form 10‑K.

(3) Long‑Term Borrowings

A summary of the long‑term borrowings entered into by the Company at December 31, 2016 and 2015 follows:

	2016		2015
Senior unsecured notes payable of $60,000 issued on
December 2005; due December 2020. Interest is payable monthly at a fixed rate of 6.60%.	$	24,000	$	24,000
Secured loan payable of $41,000, payable in monthly installments of $137 through July 1, 2024, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.23% at December 31, 2015.)		-		12,827
Secured loan payable of $11,187, payable in monthly installments of $137 through October 1, 2023, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.77% at December 31, 2016.)		11,187		-
Total borrowings		35,187		36,827
Less unamortized debt issuance costs		102		-
	$	35,085	$	36,827

Aggregate maturities of the Company’s long term borrowings as of December 31, 2016 are summarized as follows:

Year ending December 31
2017	$	1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
	$	35,187

All of the Company’s senior notes may be prepaid at par, in total or partially, five years after issuance as determined by the Company.  These senior unsecured notes contain certain non-financial covenants with which the Company has complied at December 31, 2016.

On December 28, 2016, TSM entered into a $35,500 credit agreement with a commercial bank in Puerto Rico. The agreement consists of three term loans: (i) Term Loan A in the principal amount of $11,187, (ii) Term Loan B in the principal amount of $20,150 and (iii) Term Loan C in the principal amount of $4,116. Term Loan A matures in October 2023 while the Term Loans B and C mature in January 2024.  Term Loan A was used to refinance the previous $41,000 secured loan payable with the same commercial bank in Puerto Rico.  Proceeds from Term Loans B and C were received on January 11, 2017 and were used to prepay the outstanding principal amount plus accrued interest of the 6.6% Senior Unsecured Notes due January 2021 ($24,000), and fund a portion of a debt service reserve for the Loan (approximately $200).  Pursuant to the credit agreement, interest is payable on the outstanding balance of the Loan at the following annual rate: (1) 1% over LIBOR for Term Loan A, (ii) 2.75% over LIBOR for Term Loan B, and (iii) 3.25% over LIBOR for Term Loan C.  Interest shall be payable commencing on January 1, 2017, in the case of Term Loan A, and on February 1, 2017, in the case of Term Loan B and Term Loan C.  The Credit Agreement includes certain financial and non-financial covenants, including negative covenants imposing certain restrictions on the Corporation’s business.  The Company was in compliance with all these covenants as of December 31, 2016.

The credit agreement is guaranteed by a first mortgage held by the bank on the Company’s land, building, and substantially all leasehold improvements, as collateral for the term of the loan under a continuing general security agreement.  This credit agreement contains certain non-financial covenants, which are customary for this type of facility, including but not limited to, restrictions on the granting of certain liens, limitations on acquisitions and limitations on changes in control and dividends.

The Company may, at its option, upon notice, as specified in the credit agreement, redeem and prepay prior to maturity, all or any part of the Loan and from time to time upon the payment of a penalty fee of 3% during the first year, 2% during the second year and 1% during the third year, and thereafter, at par, as specified in the credit agreement, together with accrued and unpaid interest, if any, to the date of redemption specified by the Company.

(4) Transactions with Related Parties

The following are the significant related parties transactions made for the three‑year period ended December 31, 2016, 2015 and 2014:

	2016		2015		2014
Rent charges to subsidiaries	$	7,801	$	7,801	$	7,801
Interest charged to subsidiaries on notes receivable		2,258		2,758		2,527
Interest charged from subsidiary on note payable		755		720		755

As of December 31, 2016 and 2015 the Company has three notes receivable from subsidiaries amounting to $30,750 and $35,250, respectively, pursuant to the provisions of Article 29.30 of the Puerto Rico Insurance Code. The notes receivable from subsidiaries are due on demand; however, pursuant to the requirements established by the Commissioner of Insurance, the parties agreed that no payment of the total principal nor the interest due on the loans will be made without first obtaining written authorization from the Commissioner of Insurance within at least 60 days prior to the proposed payment date. These notes bear interest at 4.7%.  Accrued interest at December 31, 2016 and 2015 amounted to $5,660 and $4,100, respectively.

In addition, as of December 31, 2016 and 2015, the Company has various notes receivable from a subsidiary amounting to $10,645 and $9,460, respectively.  Accrued interest at December 31, 2016 and 2015 amounted to $98 and $48, respectively.  These notes are due in different years, which due dates range from 2019 to 2020, and bear an average interest of 5.1%.

As of December 31, 2016 and 2015 the Company has a note payable to a subsidiary amounting to $15,000.  The note is due on December 31, 2017 and bears interest at 4.7%.  Accrued interest at December 31, 2016 and 2015 amounted to $1,475 and $720, respectively.

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Schedule III - Supplementary Insurance Information

12 Months Ended

Dec. 31, 2016

Schedule III - Supplementary Insurance Information [Abstract]

Schedule III - Supplementary Insurance Information

Schedule III - Supplementary Insurance Information

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)	Deferred																			Amortization of
	Policy																			Deferred Policy
	Acquisition					Liability for				Other										Acquisition
	Costs and Value					Future				Policy Claims					Net					Costs and Value		Other		Net
	of Business		Claim			Policy		Unearned		and Benefits		Premium			Investment		Claims			of Business		Operating		Premiums
Segment	Acquired		Liabilities			Benefits		Premiums		Payable		Revenue			Income		Incurred			Acquired		Expenses		Written
2016
Managed care	$	-	$	349,047		$	-	$	2,889	$	-	$	2,648,469		$	15,102	$	2,347,547		$	-	$	375,262	$	2,648,469
Life insurance		177,811		42,858			321,232		8,122		-		156,856			24,877		86,924			12,530		60,821		152,506
Property and casualty insurance		16,976		96,977			-		68,299		-		87,945			8,891		40,766			25,170		18,826		87,158
Other non-reportable segments, parent company operations and net consolidating entries.		-		(939	)		-		-		-		(2,629	)		43		(3,046	)		-		1,285		(2,629	)
											-
Total	$	194,787	$	487,943		$	321,232	$	79,310	$	-	$	2,890,641		$	48,913	$	2,472,191		$	37,700	$	456,194	$	2,885,504
2015
Managed care	$	-	$	348,297		$	-	$	3,489	$	-	$	2,549,522		$	11,779	$	2,196,693		$	-	$	393,407	$	2,549,173
Life insurance		172,284		44,601			352,370		6,596		-		148,115			24,457		82,561			17,661		52,338		144,262
Property and casualty insurance		18,364		99,796			-		70,175		-		87,633			8,706		42,600			25,933		19,533		85,734
Other non-reportable segments, parent company operations and net consolidating entries.		-		(929	)		-		-		-		(2,116	)		232		(3,139	)		-		9,849		(2,116	)
											-
Total	$	190,648	$	491,765		$	352,370	$	80,260	$	-	$	2,783,154		$	45,174	$	2,318,715		$	43,594	$	475,127	$	2,777,053
2014
Managed care	$	-	$	249,330		$	-	$	4,340	$	-	$	1,896,142		$	15,010	$	1,629,095		$	-	$	374,244	$	1,896,142
Life insurance		164,367		43,670			328,293		5,158		-		142,485			23,717		74,850			18,260		50,531		142,485
Property and casualty insurance		19,733		97,451			-		73,158		-		92,143			8,600		46,330			25,378		18,991		89,092
Other non-reportable segments, parent company operations and net consolidating entries.		-		(365	)		-		-		-		(2,204	)		213		(2,680	)		-		9,790		-
											-
Total	$	184,100	$	390,086		$	328,293	$	82,656	$	-	$	2,128,566		$	47,540	$	1,747,595		$	43,638	$	453,556	$	2,127,719

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Schedule IV - Reinsurance

12 Months Ended

Dec. 31, 2016

Schedule IV - Reinsurance [Abstract]

Schedule IV - Reinsurance

Schedule IV - Reinsurance

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)

									Percentage
			Ceded to		Assumed				of Amount
	Gross		Other		from Other		Net		Assumed
	Amount (1)		Companies		Companies		Amount		to Net
2016
Life insurance in force	$	10,178,956					$	10,178,956		0.0	%
Premiums:
Life insurance	$	160,628	$	8,838	$	4,350	$	156,140		2.8	%
Accident and health insurance		2,650,011		3,148		306		2,647,169		0.0	%
Property and casualty insurance		134,378		47,046		-		87,332		0.0	%
Total premiums	$	2,945,017	$	59,032	$	4,656	$	2,890,641		0.2	%
2015
Life insurance in force	$	10,129,123					$	10,129,123		0.0	%
Premiums:
Life insurance	$	153,607	$	9,596	$	3,853	$	147,864		2.6	%
Accident and health insurance		2,552,699		4,778		349		2,548,270		0.0	%
Property and casualty insurance		136,780		49,760		-		87,020		0.0	%
Total premiums	$	2,843,086	$	64,134	$	4,202	$	2,783,154		0.2	%
2014
Life insurance in force	$	9,739,048					$	9,739,048		0.0	%
Premiums:
Life insurance	$	152,573	$	10,328	$	-	$	142,245		0.0	%
Accident and health insurance		1,900,556		5,765		-		1,894,791		0.0	%
Property and casualty insurance		146,222		54,692		-		91,530		0.0	%
Total premiums	$	2,199,351	$	70,785	$	-	$	2,128,566		0.0	%

(1) Gross premiums amount is presented net of intercompany eliminations of $3,457,  $4,402 and $4,354 for the years ended December 31, 2016, 2015, and 2014, respectively.

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Schedule V - Valuation and Qualifying Accounts

12 Months Ended

Dec. 31, 2016

Schedule V - Valuation and Qualifying Accounts [Abstract]

Schedule V - Valuation and Qualifying Accounts

Schedule V - Valuation and Qualifying Accounts

For the years ended December 31, 2016, 2015 and 2014

(Dollar amounts in thousands)

			Additions
	Balance at		Charged to		Charged (Reversal)					Balance at
	Beginning of		Costs and		To Other Accounts		Deductions -			End of
	Period		Expenses		- Describe (1)		Describe (2)			Period
2016
Allowance for doubtful receivables	$	37,244		1,295		306		(1,538	)	$	37,307
2015
Allowance for doubtful receivables	$	36,368		15,781		340		(15,245	)	$	37,244
2014
Allowance for doubtful receivables	$	21,549		12,847		4,227		(2,255	)	$	36,368

(1) Represents premiums adjustment to provide for unresolved reconciliation items with the Government of Puerto Rico and other entities.

(2) Deductions represent the write-off of accounts deemed uncollectible.

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Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2016

Significant Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (GAAP).

The consolidated financial statements include the financial statements of the Company and its subsidiaries.  Intercompany balances and transactions have been eliminated in consolidation.

Use of Estimates

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make a number of estimates and assumptions relating to the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenue and expenses during the period.  Actual results could differ from those estimates.

Cash Equivalents

Cash Equivalents

The Company considers all highly liquid debt instruments with maturities of three months or less at the date of acquisition to be cash equivalents.  Cash equivalents of $24,486 and $113,040 at December 31, 2016 and 2015, respectively, consist principally of money market funds and certificates of deposit with original maturities of three months or less.

Investments

Investments

Investment in securities at December 31, 2016 and 2015 consists mainly of obligations of government‑sponsored enterprises, U.S. Treasury securities and obligations of U.S. government instrumentalities, obligations of the Commonwealth of Puerto Rico and its instrumentalities, municipal securities, corporate bonds, residential mortgage-backed securities, collateralized mortgage obligations, and equity securities.  The Company classifies its debt and equity securities in one of three categories: trading, available for sale, or held to maturity.  Trading securities are bought and held principally for the purpose of selling them in the near term.  Securities classified as held to maturity are those securities in which the Company has the ability and intent to hold the security until maturity.  All other securities not included in trading or held to maturity are classified as available for sale.

Trading and available-for-sale securities are recorded at fair value.  The fair values of debt securities (both available for sale and held to maturity investments) and equity securities are based on quoted market prices for those or similar investments at the reporting date.  Held-to-maturity debt securities are recorded at amortized cost, adjusted for the amortization or accretion of premiums and discounts, respectively.  Unrealized holding gains and losses on trading securities are included in earnings.  Unrealized holding gains and losses, net of the related tax effect, on available-for-sale securities are excluded from earnings and are reported as a separate component of other comprehensive income until realized.  Realized gains and losses from the sale of available-for-sale securities are included in earnings and are determined on a specific‑identification basis.

Transfers of securities between categories are recorded at fair value at the date of transfer.  Unrealized holding gains and losses are recognized in earnings for transfers into trading securities.  Unrealized holding gains or losses associated with transfers of securities from held to maturity to available for sale are recorded as a separate component of other comprehensive income.  The unrealized holding gains or losses included in the separate component of other comprehensive income for securities transferred from available for sale to held to maturity, are maintained and amortized into earnings over the remaining life of the security as an adjustment to yield in a manner consistent with the amortization or accretion of premium or discount on the associated security.

If a fixed maturity security is in an unrealized loss position and the Company has the intent to sell the fixed maturity security, or it is more likely than not that the Company will have to sell the fixed maturity security before recovery of its amortized cost basis, the decline in value is deemed to be other-than-temporary and is recorded to other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings.  For impaired fixed maturity securities that the Company does not intend to sell or it is more likely than not that such securities will not have to be sold, but the Company expects not to fully recover the amortized cost basis, the credit component of the other-than temporary impairment is recognized in other-than-temporary impairment losses recognized in earnings in the Company’s consolidated statements of earnings and the non-credit component of the other-than-temporary impairment is recognized in other comprehensive income.  Furthermore, unrealized losses entirely caused by non-credit related factors related to fixed maturity securities for which the Company expects to fully recover the amortized cost basis continue to be recognized in accumulated other comprehensive income.

The credit component of an other-than-temporary impairment is determined by comparing the net present value of projected future cash flows with the amortized cost basis of the fixed maturity security. The net present value is calculated by discounting the Company’s best estimate of projected future cash flows at the effective interest rate implicit in the fixed maturity security at the date of acquisition.

The unrealized gains or losses on the Company’s equity securities classified as available-for-sale are included in accumulated other comprehensive income as a separate component of  stockholders’ equity, unless the decline in value is deemed to be other-than-temporary and the Company does not have the intent and ability to hold such equity securities until their full cost can be recovered, in which case such equity securities are written down to fair value and the loss is charged to other-than-temporary impairment losses recognized in earnings.

A decline in the fair value of any available-for-sale or held-to-maturity security below cost that is deemed to be other-than-temporary results in an impairment to reduce the carrying amount to fair value.  The impairment is charged to earnings and a new cost basis for the security is established.  To determine whether an impairment is other-than-temporary, the Company considers whether it has the ability and intent to hold the investment until a market price recovery and considers whether evidence indicating the cost of the investment is recoverable outweighs evidence to the contrary.  Evidence considered in this assessment includes the reasons for the impairment, the severity and duration of the impairment, market conditions, changes in value subsequent to year-end, forecasted performance of the investee, and the general market condition in the geographic area or industry the investee operates in.

Premiums and discounts are amortized or accreted over the life of the related held-to-maturity or available-for-sale security as an adjustment to yield using the effective interest method.  Dividend and interest income are recognized when earned.

The Company regularly invests in mortgaged-backed securities and other securities subject to prepayment and call risk.  Significant changes in prevailing interest rates may adversely affect the timing and amount of cash flows on such securities.  In addition, the amortization of market premium and accretion of market discount for mortgaged-backed securities is based on historical experience and estimates of future payment speeds on the underlying mortgage loans.  Actual prepayment speeds may differ from original estimates and may result in material adjustments to amortization or accretion recorded in future periods.

Revenue Recognition

Revenue Recognition

a. Managed Care

Subscriber premiums on the managed care business are billed in advance of their respective coverage period and the related revenue is recorded as earned during the coverage period.  Managed care premiums are billed in the month prior to the effective date of the policy with a grace period of up to two months.  If the insured fails to pay, the policy can be cancelled at the end of the grace period at the option of the Company.  Premiums for the Medicaid business are based on a bid contract with ASES and billed in advance of coverage period.  Under the risk-based Medicaid contract, there is an excess profit agreement which stipulates that the profit of TSS for each fiscal year of the contract term shall not exceed two and a half percentage (2.5%) of the fixed amount paid by ASES for each member.  In the event that the profit exceeds this amount, TSS and ASES shall share the excess profit in proportions of fifty percent (50%), subject to the compliance by TSS with certain quality metrics.  ASES retains the right to determine the outcome of the excess profit agreement that is based on audited financial statements of the contracted services submitted annually by TSS and the validation of the Incurred-But-Not-Reported (“IBNR”) reserve by ASES’s actuary.  We estimate the effect of the following arrangements on a monthly basis and reflect the adjustments to premium revenue in current operations.  We report any estimated net amounts due to ASES within accounts payable and accrued liabilities in the consolidated balance sheets. As the contract year progresses and additional information becomes available, any excess profit will be recorded in the operating results of the period in which the information becomes available.

Premiums for the Medicare Advantage (MA) business are based on a bid contract with the Centers for Medicare and Medicaid Services (CMS) and billed in advance of the coverage period.  MA contracts provide for a risk factor to adjust premiums paid for members that represent a higher or lower risk to the Company.  Retroactive rate adjustments are made periodically based on the aggregate health status and risk scores of the Company’s MA membership.  These risk adjustments are evaluated quarterly, based on actuarial estimates.  Actual results could differ from these estimates.  We recognize periodic changes to risk-adjusted premiums as revenue when the amounts are determinable and collections is reasonably assured, which is possible as additional diagnosis code information is reported to CMS, when the ultimate adjustments settlements are received from CMS, or we receive notification of such settlement amounts.  The data provided to CMS to determine member's risk scores is subject to audit by CMS even after the annual settlements occur, which may result in the refund of premiums to CMS. As additional information becomes available, the recorded estimate is revised and reflected in operating results in the period in which it becomes available.

Prescription drug coverage is offered to Medicare eligible beneficiaries as part of MA plans (MA-PD) and until 2014, on a stand-alone basis (stand-alone PDP).  Premiums are based on a bid contract with CMS that considers the estimated costs of providing prescription drug benefits to enrolled participants.  MA-PD and stand-alone PDP premiums are subject to adjustment, positive or negative, based upon the application of risk corridors that compare the estimated prescription drug costs included in the bids to CMS to actual prescription drug costs.  Variances exceeding certain thresholds may result in CMS making additional payments or in CMS requesting a refund for a portion of the premiums collected.  The Company estimates and records adjustments to earned premiums related to estimated risk corridor payments based upon actual prescription drug costs for each reporting period as if the annual contract were to end at the end of each reporting period.

Administrative service fees include revenue from certain groups which have managed care contracts that provide for the group to be at risk for all or a portion of their claims experience.  For these groups, the Company is not at risk and only handles the administration of managed care coverage for an administrative service fee.  The Company pays claims under commercial self-funded arrangements from its own funds, and subsequently receives reimbursement from these groups.  Until March 31, 2015, the claims related to the administration of the Medicaid business under the ASO delivery model were paid from a bank account owned and funded by the Government of Puerto Rico.  Claims paid under self-funded arrangements are excluded from the claims incurred in the accompanying consolidated financial statements.  Administrative service fees under the self-funded arrangements are recognized based on the group’s membership or incurred claims for the period multiplied by an administrative fee rate plus other fees.  In addition, some of these self-funded groups purchase aggregate and/or specific stop-loss coverage.  In exchange for a premium, the group’s aggregate liability or the group’s liability on any one episode of care is capped for the year.  Premiums for the stop-loss coverage are actuarially determined based on experience and other factors and are recorded as earned over the period of the contract in proportion to the coverage provided.  This fully insured portion of premiums is included within the premiums earned, net in the accompanying consolidated statements of earnings.  The Medicaid contract with the Government of Puerto Rico to administer the provision of the physical health component of this program contained a savings-sharing provision whereby the Government of Puerto Rico shared with TSS a portion of the medical cost savings obtained with the administration of the regions served on an administrative service basis.  Any savings-sharing amount was recorded when earned as administrative service fees in the accompanying consolidated statements of earnings.

b. Life and Accident and Health Insurance

Premiums on life insurance policies are billed in advance of their respective coverage period and the related revenue is recorded as earned when due.  Premiums on accident and health and other short‑term policies are recognized as earned primarily on a pro rata basis over the contract period.  Premiums on credit life policies are recognized as earned in proportion to the amounts of insurance in‑force.  Revenues from universal life and interest sensitive policies represent amounts assessed against policyholders, including mortality charges, surrender charges actually paid, and earned policy service fees.  The revenues for limited payment contracts are recognized over the period that benefits are provided rather than on collection of premiums.

c. Property and Casualty Insurance

Premiums on property and casualty contracts are billed in advance of their respective coverage period and they are recognized as earned on a pro rata basis over the policy term.  The portion of premiums related to the period prior to the end of coverage is recorded in the consolidated balance sheets as unearned premiums and is transferred to premium revenue as earned.

Allowance for Doubtful Receivables

Allowance for Doubtful Receivables

The allowance for doubtful receivables is based on management’s evaluation of the aging of accounts and such other factors which deserve current recognition, including the continued deterioration of the local economy, the exposure to government accounts, and the challenging business environment in the island.  This evaluation is performed individually on larger accounts and includes the use of all available information such as the customer’s credit worthiness and other relevant information.  Actual losses could differ from these estimates.  Receivables are charged-off against their respective allowance accounts when deemed to be uncollectible.

Deferred Policy Acquisition Costs and Value of Business Acquired

Deferred Policy Acquisition Costs and Value of Business Acquired

Certain direct costs for acquiring successful life and accident and health, and property and casualty insurance segment are deferred by the Company.  Substantially all acquisition costs related to the managed care segment are expensed as incurred.

In the life and accident and health segment deferred acquisition costs consist of commissions and certain expenses related to the production of life, annuity, accident and health, and credit business.  In the event that future premiums, in combination with policyholder reserves and anticipated investment income, could not provide for all future maintenance and settlement expenses, the amount of deferred policy acquisition costs would be reduced to provide for such amount.  The related amortization is provided over the anticipated premium-paying period of the related policies in proportion to the ratio of annual premium revenue to expected total premium revenue to be received over the life of the policies.  Interest is considered in the amortization of deferred policy acquisition cost and value of business acquired.  For these contracts interest is considered at a level rate at the time of issue of each contract, 5.15% for 2016, from 4.50% to 4.90% for 2015 and 4.90% for 2014, and, in the case of the value of business acquired, at the time of any acquisition.

For certain other long-duration contracts, deferred amounts are amortized at historical and forecasted credited interest rates.  Expected premium revenue is estimated by using the same mortality and withdrawal assumptions used in computing liabilities for future policy benefits.  The method followed in computing deferred policy acquisition costs limits the amount of such deferred costs to their estimated net realizable value.  In determining estimated net realizable value, the computations give effect to the premiums to be earned, related investment income, losses and loss-adjustment expenses, and certain other costs expected to be incurred as the premium is earned.

Costs deferred on universal life and interest sensitive products are amortized as a level percentage of the present value of anticipated gross profits from investment yields, mortality, expenses and surrender charges.  Estimates used are based on the Company’s experience as adjusted to provide for possible adverse deviations.  These estimates are periodically reviewed and compared with actual experience.  When it is determined that future expected experience differs significantly from that assumed, the estimates are updated for current and future issues which may result in a change or release of deferred policy acquisition costs amortization through the consolidated statement of earnings.

The value assigned to the life insurance in-force at the date of the acquisition is amortized using methods similar to those used to amortize the deferred policy acquisition costs of the life and accident and health segment.

In the property and casualty segment, acquisition costs consist of commissions incurred during the production of business and are deferred and amortized ratably over the terms of the policies.

Property and Equipment

Property and Equipment

Property and equipment are stated at cost.  Maintenance and repairs are expensed as incurred.  Depreciation is calculated on the straight-line method over the estimated useful lives of the assets.  Costs of computer equipment, programs, systems, installations, and enhancements are capitalized and amortized straight-line over their estimated useful lives.  The following is a summary of the estimated useful lives of the Company’s property and equipment:

Asset Category	Estimated Useful Life
Buildings	20 to 50 years
Building improvements	3 to 5 years
Leasehold improvements	Shorter of estimated useful
Office furniture	life or lease term 5 years
Computer software	3 to 10 years
Computer equipment, equipment, and automobiles	3 years

Long-Lived Assets, including Goodwill

Long-Lived Assets, including Goodwill

Long‑lived assets, such as property and equipment, and purchased intangible assets subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.  Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to estimated undiscounted future cash flows expected to be generated by the asset.  If the carrying amount of an asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset.  Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the carrying amount or fair value less costs to sell, and are no longer depreciated.  The assets and liabilities of a disposal group classified as held for sale would be presented separately in the appropriate asset and liability sections of the consolidated balance sheets.

During 2014, the Company identified events that indicated that the carrying amount of the intangible assets purchased as part of the health clinic acquisition may not be recoverable.  As such, the Company performed an impairment analysis on those intangible assets and based on the results of the test, an impairment charge of $2,221 was recorded caused by the carrying value being greater than its fair value.  After the impairment charge, which is included within the consolidated operating expenses, there is no remaining carrying value of the acquired intangible assets as of December 31, 2014 related to the health clinic acquisition.  During 2016 and 2015, impairment tests on the remaining intangible assets were performed and based on the results of the tests no impairment was recorded.

Goodwill and intangible assets that have indefinite useful lives are tested at least annually for impairment, and are tested for impairment more frequently if events and circumstances indicate that the asset might be impaired.  An impairment loss is recognized to the extent that the carrying amount exceeds the asset’s fair value.  For goodwill, the impairment determination is made at the reporting unit level.  The Company first assesses qualitative factors to determine whether it is necessary to perform the two-step goodwill impairment test.  The Company assesses qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill.  If determined to be necessary, the two-step impairment test is used to identify potential goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any).   First, the Company determines the fair value of a reporting unit and compares it to its carrying amount.  Second, if the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized for any excess of the carrying amount of the reporting unit’s goodwill over the implied fair value of that goodwill.  The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation.  The residual fair value after this allocation is the implied fair value of the reporting unit goodwill.

The annual impairment test is based on an evaluation of estimated future discounted cash flows.  The estimated discounted cash flows are based on the best information available, including supportable assumptions and projections we believe are reasonable. Our discounted cash flow estimates use discount rates that correspond to a weighted-average cost of capital consistent with a market-participant view. The discount rates are consistent with those used for investment decisions and take into account the operating plans and strategies of our operating segments. Certain other key assumptions utilized, including changes in membership, premium, health care costs, operating expenses, fees, assessments and taxes and effective tax rates, are based on estimates consistent with those utilized in our annual budgeting and planning process that we believe are reasonable. However, if we do not achieve the results reflected in the assumptions and estimates, our goodwill impairment evaluations could be adversely affected, and we may impair a portion of our goodwill, which would adversely affect our operating results in the period of impairment. Impairments, if any, would be classified as an operating expense.

Claim Liabilities

Claim Liabilities

Claim liabilities for managed care policies represent the estimated amounts to be paid to providers based on experience and accumulated statistical data.  Loss-adjustment expenses related to such claims are currently accrued based on estimated future expenses necessary to process such claims. Managed care claim liabilities also include a provision for adverse deviation, which is an estimate for known environmental factors that are reasonably likely to affect the required level of reserves. This provision for adverse deviation is intended to capture the potential adverse development from known environmental factors such as our entry into new geographical markets, changes in our geographic or product mix, the introduction of new customer populations, variation in benefit utilization, disease outbreaks, changes in provider reimbursement, fluctuations in medical cost trend, variation in claim submission patterns and variation in claims processing speed and payment patterns, changes in technology that provide faster access to claims data or change the speed of adjudication and settlement of claims, variability in claim inventory levels, non-standard claim development, and/or exceptional situations that require judgmental adjustments in setting the reserves for claims.

The Company contracts with various independent practice associations (IPAs) for certain medical care services provided to some policies subscribers.  The IPAs are compensated on a capitation basis and capitation payables are included in claim liabilities.

Claim liabilities include unpaid claims and loss-adjustment expenses of the life and accident and health segment based on a case-basis estimate for reported claims, and on estimates, based on experience, for unreported claims and loss-adjustment expenses.  The liability for policy and contract claims and claims expenses has been established to cover the estimated net cost of insured claims.

Also included within the claim liabilities is the liability for losses and loss-adjustment expenses for the property and casualty segment which represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expenses for investigating and settling claims.

Claim liabilities are necessarily based on estimates and, while management believes that the amounts are adequate, the ultimate liability may be in excess of or less than the amounts provided.  The methods for making such estimates and for establishing the resulting liability are continually reviewed, and any adjustments are reflected in the consolidated statements of earnings in the period determined.

Future Policy Benefits

Future Policy Benefits

The liability for future policy benefits has been computed using the level‑premium method based on estimated future investment yield, mortality, morbidity and withdrawal experience.  The assumptions are established at the time the policy is issued and are generally not changed during the life of the policy.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required. The interest rate assumption ranges between 3.90% and 5.75% for all years in issue.

Mortality has been calculated principally on select and ultimate tables in common usage in the industry.  Withdrawals have been estimated principally based on industry tables, modified by Company’s experience.  The Company periodically reviews the adequacy of reserves for these policies on an aggregate basis using actual experience. If actual experience is significantly adverse compared to the original assumptions and a premium deficiency is determined to exist, any remaining unamortized DAC balance would be expensed to the extent not recoverable and the establishment of a premium deficiency reserve may be required.

Policyholder Deposits

Policyholder Deposits

Amounts received for annuity contracts are considered deposits and recorded as a liability along with the accrued interest and reduced for charges and withdrawals.  Interest incurred on such deposits, which amounted to $3,182, $3,379, and $3,510, during the years ended December 31, 2016, 2015, and 2014, respectively, is included within the interest expense in the accompanying consolidated statements of earnings.

Policyholder account balances for universal life and interest sensitive products are equal to policy account values. The policy account primarily comprises cumulative deposits received and interest credited to the policyholder less cumulative contract benefits, surrenders, withdrawals, maturities and contract charges for mortality or administrative expenses.  Interest rates credited to policyholder account balances during 2016 range from 1.25% to 4.5%, and during 2015 range from 2.0% to 4.5% for universal life and interest sensitive products.  The universal life and interest sensitive products represented $69,445 and $62,840 of the policyholder deposits balance on the consolidated balance sheets as of December 31, 2016 and 2015, respectively.

Reinsurance

Reinsurance

In the normal course of business, the insurance-related subsidiaries seek to limit their exposure that may arise from catastrophes or other events that cause unfavorable underwriting results by reinsuring certain levels of risk in various areas of exposure with other insurance enterprises or reinsurers.

Reinsurance premiums, commissions, and expense reimbursements, related to reinsured business are accounted for on bases consistent with those used in accounting for the original policies issued and the terms of the reinsurance contracts.  Accordingly, reinsurance premiums are reported as prepaid reinsurance premiums and amortized over the remaining contract period in proportion to the amount of insurance protection provided.

Premiums ceded and recoveries of losses and loss-adjustment expenses have been reported as a reduction of premiums earned and losses and loss-adjustment expenses incurred, respectively.  Property and casualty commission and expense allowances received in connection with reinsurance ceded have been accounted for as a reduction of the related policy acquisition costs and are deferred and amortized accordingly.  Amounts recoverable from reinsurers are estimated in a manner consistent with the claim liability associated with the reinsured policy.

Income Taxes

Income Taxes

Income taxes are accounted for under the asset and liability method.  Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards.  Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.  The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the consolidated statements of earnings in the period that includes the enactment date.  The Company recognizes the effect of income tax positions only if those positions are more likely than not of being sustained.  Recognized income tax positions are measured at the largest amount that is greater than 50% likely of being realized.  Changes in recognition or measurement are reflected in the period in which the change in circumstances occurs.

The Company records any interest and penalties related to unrecognized tax benefits within the operating expenses in the consolidated statement of earnings.

The holding company within the TSA group of companies is a U.S.-based company that has not recorded a U.S. deferred tax liability for the excess of the book basis over the tax basis of its investments in Puerto Rico corporations.  TSA has not recorded a deferred tax liability to the extent that the basis difference results from outside basis difference created as a result of the business combination and earnings that meet the indefinite reversal criteria. The indefinite reversal criteria is met if the Puerto Rico subsidiary has invested, or will invest, the undistributed earnings indefinitely. The decision as to the amount of undistributed earnings intended to be maintained in Puerto Rico corporations takes into account several items including, but not limited to, actual results of operations, forecasts and budgets of financial needs of cash for working capital, liquidity plans, capital improvement programs, merger and acquisition plans as well as expected cash requirements in the U.S. or in other Puerto Rico subsidiaries from the U.S.-based company.

Health Insurance Providers Fee

Health Insurance Providers Fee

The Patient Protection and Affordable Care Act as amended by the Health Care and Education Reconciliation Act (ACA) mandates an annual Health Insurance Providers Fee (HIP Fee).  The annual HIP Fee, which was effective January 1, 2014, becomes payable to the U.S. Treasury once the entity provides health insurance for any U.S. health risk each applicable calendar year.  The initial estimated annual fee is accrued as of January 1, with a corresponding deferred cost that is amortized over 12 months on a straight line basis. The fee payment is due on September 30 of each year. The Company incurred approximately $44,100, $34,500 and $27,700 of such fees in 2016, 2015 and 2014, respectively, which are presented within the consolidated operating expenses.

Insurance Related Assessments

Insurance-Related Assessments

The Company records a liability for insurance-related assessments when the following three conditions are met: (1) the assessment has been imposed or the information available prior to the issuance of the financial statements indicates it is probable that an assessment will be imposed; (2) the event obligating an entity to pay (underlying cause of) an imposed or probable assessment has occurred on or before the date of the financial statements; and (3) the amount of the assessment can be reasonably estimated.  A related asset is recognized when the paid or accrued assessment is recoverable through either premium taxes or policy surcharges.

Commitments and Contingencies

Commitments and Contingencies

Liabilities for loss contingencies arising from claims, assessments, litigation, fines, and penalties and other sources are recorded when it is probable that a liability has been incurred and the amount of the assessment and/or remediation can be reasonably estimated.  Legal costs incurred in connection with loss contingencies are expensed as incurred.  Recoveries of costs from third parties, which are probable of realization, are separately recorded as assets, and are not offset against the related liability.

Share-Based Compensation

Share‑Based Compensation

Share-based compensation is measured at the fair value of the award and recognized as an expense in the financial statements over the vesting period.

Earnings Per Share

Earnings Per Share

Basic earnings per share excludes dilution and is computed by dividing net income available to all classes of common stockholders by the weighted average number of all classes of common shares outstanding for the period, excluding non-vested restricted stocks.  Diluted earnings per share is computed in the same manner as basic earnings per share except that the number of shares is increased to include the number of additional common shares that would have been outstanding if the potentially dilutive common shares had been issued.  Dilutive common shares are included in the diluted earnings per share calculation using the treasury stock method.

Recently Issued Accounting Standards

Recently Issued Accounting Standards

On January 5, 2016, the FASB issued guidance to enhance the reporting model for financial instruments to provide users of financial statements with more decision-useful information.  Among the many targeted improvements to U.S. GAAP are (1) requiring equity investments, except those accounted for under the equity method of accounting or those that result in consolidation of the investee, to be measured at fair value with changes in fair value recognized in net income; (2) simplifying the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) eliminating the requirement to disclose the fair value of financial instruments measured at amortized cost for entities that are not public business entities; and (4) clarifying that an entity should evaluate the need for a valuation allowance on a deferred tax asset related to available-for-sale securities in combination with the entity’s other deferred tax assets.  This guidance applies to all entities that hold financial assets or owe financial liabilities. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

On February 25, 2016, the FASB issued guidance to increase transparency and comparability among organizations by recognizing lease assets and lease liabilities on the balance sheet and by disclosing key information about leasing arrangements.  This guidance sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessors and lessees. It requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase by the lessee. This classification will determine whether lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease, respectively. A lessee is also required to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases today. The guidance requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales-type leases, direct financing leases and operating leases. Companies are required to adopt the new guidance using a modified retrospective approach for annual and interim periods beginning after December 31, 2018.  We are currently evaluating the impact, if any, the adoption of this guidance may have on the Company's consolidated financial statements.

On March 30, 2016, the FASB issued guidance to reduce complexity in accounting standards.  The areas for simplification involve several aspects of the accounting for share-based payment transactions, including (1) accounting for income taxes, (2) classification of excess tax benefits on the statement of cash flow, (3) forfeitures; (4) minimum statutory tax withholding requirements, (5) classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax withholding purposes:, (6) the practical expedient for estimating the expected term, and (7) intrinsic value.  The guidance related to when excess tax benefits are recognized will be adopted through a modified retrospective approach by means of a cumulative-effect adjustment to equity as of January 1, 2017.  The provisions related to the recognition of excess tax benefits in the income statements and classification in the statement of cash flows will be adopted prospectively.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2016, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On May 9, 2016, the FASB issued guidance which affects only the narrow aspects of guidance related to revenue from contracts with customers that include: (1) clarification of the collectibility criterion and the addition of a new criterion to clarify when revenue would be recognized for a contract that fails to meet the criteria in step 1 of the core principle of the guidance (i.e., identifying the contracts with a customer); (2) presentation of sales taxes and similar taxes collected from customers; (3) non-cash consideration; (4) contract modifications at transition; (5) completed contracts at transition; and (6) clarification that an entity that retrospectively applies in the guidance to each prior reporting period is not required to disclose the effect of the accounting change for the period of adoption, but is still required to disclose the effect of the changes on any prior periods retrospectively adjusted. For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  As the majority of the Company’s revenues are not subject to the new guidance, the adoption of this guidance should not have a material impact on the Company’s consolidated financial position, result of operations, equity or cash flows. We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On June 16, 2016, the FASB issued guidance to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date by replacing the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On August 26, 2016, the FASB issued guidance to addresses stakeholders’ concerns regarding diversity in practice in how certain cash receipts and cash payments are presented and classified in the statement of cash flows under, Statement of Cash Flows, and other Topics.  In particular, the guidance addresses eight specific cash flow issues in an effort to reduce this diversity in practice: (1) debt prepayment or debt extinguishment costs; (2) settlement of zero-coupon bonds; (3) contingent consideration payments made after a business combination; (4) proceeds from the settlement of insurance claims; (5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies; (6) distributions received from equity method investees; (7) beneficial interests in securitization transactions; and (8) separately identifiable cash flows and application of the predominance principle.  For public companies, these amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years.  We are currently evaluating the impact the adoption of this guidance may have on the Company's consolidated financial statements.

On December 14, 2016, the FASB issued guidance that amended the Master Glossary of the Accounting Standards Codification (ASC), including simplification and minor improvements to Codification topics and subtopics regarding insurance and troubled debt restructuring that result in numerous editorial changes to the Codification, but are not expected to affect current accounting practice or result in any significant costs.  However, there are six amendments that clarify guidance or correct references in the Codification, and could potentially result in changes in current practice because of either misapplication or misunderstanding of current guidance, including amendments to (1) Property, Plant, and Equipment—Real Estate Sales; (2) Fair Value Measurement; (3) Transfers and Servicing —Sales of Financial Assets; (4) Liabilities—Obligations Resulting from Joint and Several Liability Arrangements; (5) Transfers and Servicing—Servicing Assets and Liabilities; and (6) Intangibles—Goodwill and Other— Internal-Use Software.  The transition guidance for the first five amendments must be applied prospectively because they could potentially involve the use of hindsight that includes fair value measurements.  Other than as indicated above, the amendments in this guidance are effective upon issuance for both public entities and nonpublic entities.  The Company adopted this guidance upon issuance with no impact on our financial position and results of operations.

Other than the accounting pronouncements disclosed above, there were no other new accounting pronouncements issued that could have a material impact in the Company’s financial position, operating results or financials statement disclosures.

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Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2016

Significant Accounting Policies [Abstract]

Property and Equipment

The following is a summary of the estimated useful lives of the Company’s property and equipment:

Asset Category	Estimated Useful Life
Buildings	20 to 50 years
Building improvements	3 to 5 years
Leasehold improvements	Shorter of estimated useful
Office furniture	life or lease term 5 years
Computer software	3 to 10 years
Computer equipment, equipment, and automobiles	3 years

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Investment in Securities (Tables)

12 Months Ended

Dec. 31, 2016

Investment in Securities [Abstract]

Amortized Cost and Estimated Fair Value for Trading, Available-for-Sale and Held-to-Maturity Securities by Major Security Type and Class of Security

The amortized cost for debt securities and cost for equity securities, gross unrealized gains, gross unrealized losses, and estimated fair value for available-for-sale and held-to-maturity securities by major security type and class of security at December 31, 2016 and 2015, were as follows:

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	41,442	$	87	$	(15	)	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,652		157		(9	)		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		17,930		2,189		(68	)		20,051
Municipal securities		650,175		34,187		(559	)		683,803
Corporate bonds		263,351		12,182		(661	)		274,872
Residential mortgage-backed securities		684		34		-			718
Collateralized mortgage obligations		45,069		58		(242	)		44,885
Total fixed maturities		1,104,303		48,894		(1,554	)		1,151,643
Equity securities-Mutual funds		240,699		30,101		(451	)		270,349
Total	$	1,345,002	$	78,995	$	(2,005	)	$	1,421,992

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Securities available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	115,965	$	301	$	(26	)	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,322		234		(286	)		163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		25,302		317		-			25,619
Municipal securities		612,225		35,418		(197	)		647,446
Corporate bonds		148,198		9,782		(572	)		157,408
Residential mortgage-backed securities		883		54		-			937
Collateralized mortgage obligations		22,363		368		(6	)		22,725
Total fixed maturities		1,088,258		46,474		(1,087	)		1,133,645
Equity securities-Mutual funds		169,593		27,851		(373	)		197,071
Total	$	1,257,851	$	74,325	$	(1,460	)	$	1,330,716

	2016
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	619	$	158	$	-	$	777
Residential mortgage-backed securities		191		18		-		209
Certificates of deposits		2,026		-		-		2,026
	$	2,836	$	176	$	-	$	3,012

	2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Securities held to maturity
U.S. Treasury securities and obligations of U.S. government instrumentalties	$	620	$	178	$	-	$	798
Residential mortgage-backed securities		191		17		-		208
Certificates of deposits		2,118		-		-		2,118
	$	2,929	$	195	$	-	$	3,124

Securities in Continuous Unrealized Loss Position

Gross unrealized losses on investment securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2016 and 2015 were as follows:

	2016
	Less than 12 months							12 months or longer							Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	9,483	$	(15	)		1	$	-	$	-			-	$	9,483	$	(15	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		12,937		(9	)		1		-		-			-		12,937		(9	)		1
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		7,758		(68	)		5		-		-			-		7,758		(68	)		5
Municipal securities		84,252		(559	)		13		-		-			-		84,252		(559	)		13
Corporate bonds		105,054		(661	)		22		-		-			-		105,054		(661	)		22
Collateralized mortgage obligations		32,120		(239	)		8		784		(3	)		1		32,904		(242	)		9
Total fixed maturities		251,604		(1,551	)		50		784		(3	)		1		252,388		(1,554	)		51
Equity securities-Mutual funds		22,615		(451	)		4		-		-			-		22,615		(451	)		4
Total for securities available for sale	$	274,219	$	(2,002	)		54	$	784	$	(3	)		1	$	275,003	$	(2,005	)		55

	2015
	Less than 12 months							12 months or longer						Total
	Estimated Fair Value		Gross Unrealized Loss			Number of Securities		Estimated Fair Value		Gross Unrealized Loss		Number of Securities		Estimated Fair Value		Gross Unrealized Loss			Number of Securities
Securites available for sale
Fixed maturities
Obligations of government-sponsored enterprises	$	18,989	$	(26	)		1	$	-	$	-		-	$	18,989	$	(26	)		1
U.S. Treasury securities and obligations of U.S. governmental instrumentalities		130,996		(286	)		5		-		-		-		130,996		(286	)		5
Municipal securities		43,937		(197	)		11		-		-		-		43,937		(197	)		11
Corporate bonds		35,718		(572	)		9		-		-		-		35,718		(572	)		9
Collateralized mortgage obligations		1,448		(6	)		1		-		-		-		1,448		(6	)		1
Total fixed maturities		231,088		(1,087	)		27		-		-		-		231,088		(1,087	)		27
Equity securities-Mutual funds		9,319		(373	)		2		-		-		-		9,319		(373	)		2
Total for securities available for sale	$	240,407	$	(1,460	)		29	$	-	$	-		-	$	240,407	$	(1,460	)		29

Maturities of Investment Securities Classified as Available for Sale and Held to Maturity

Maturities of investment securities classified as available for sale and held to maturity at December 31, 2016 were as follows:

	Amortized Cost		Estimated Fair Value
Securities available for sale
Due in one year or less	$	11,010	$	11,116
Due after one year through five years		343,904		347,140
Due after five years through ten years		144,748		152,225
Due after ten years		558,888		595,559
Residential mortgage-backed securities		684		718
Collateralized mortgage obligations		45,069		44,885
	$	1,104,303	$	1,151,643
Securities held to maturity
Due in one year or less	$	2,026	$	2,026
Due after ten years		619		777
Residential mortgage-backed securities		191		209
	$	2,836	$	3,012

Realized Gains and Losses from Investments

Information regarding realized and unrealized gains and losses from investments for the years ended December 31, 2016, 2015, and 2014 is as follows:

	2016			2015			2014
Realized gains (losses)
Fixed maturity securities
Securities available for sale
Gross gains from sales	$	3,086		$	8,208		$	5,118
Gross losses from sales		(2,744	)		(646	)		(5,884	)
Gross losses from other-than-temporary impairments		-			(4,267	)		(1,170	)
Total fixed maturity securities		342			3,295			(1,936	)
Equity securities
Securities available for sale
Gross gains from sales		19,674			17,903			20,848
Gross losses from sales		(1,203	)		(1,312	)		(2,106	)
Gross losses from other-than-temporary impairments		(1,434	)		(945	)		-
Total equity securities		17,037			15,646			18,742
Net realized gains on securities available for sale		17,379			18,941			16,806
Gross gain from other investment		-			-			1,425
Net realized gains on securities	$	17,379		$	18,941		$	18,231

Changes in Net Unrealized Gains (Losses)

The other-than-temporary impairments on fixed maturity securities are attributable to credit losses.

	2016			2015			2014
Changes in unrealized gains (losses)
Recognized in accumulated other comprehensive income (loss)
Fixed maturities – available for sale		1,953			(25,227	)		46,220
Equity securities – available for sale		2,172			(19,479	)		(5,620	)
	$	4,125		$	(44,706	)	$	40,600
Not recognized in the consolidated financial statements
Fixed maturities – held to maturity	$	(19	)	$	(24	)	$	49

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Net Investment Income (Tables)

12 Months Ended

Dec. 31, 2016

Net Investment Income [Abstract]

Components of Net Investment Income

Interest and/or dividend income from:

	Years ended December 31
	2016		2015		2014
Fixed maturities	$	37,139	$	36,256	$	38,559
Equity securities		9,666		7,146		7,660
Policy loans		619		557		545
Cash equivalents and interest-bearing deposits		257		143		117
Other		1,232		1,072		659
Total	$	48,913	$	45,174	$	47,540

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Premium and Other Receivables, Net (Tables)

12 Months Ended

Dec. 31, 2016

Premium and Other Receivables, Net [Abstract]

Premiums and Other Receivables, Net

Premium and other receivables, net as of December 31 were as follows:

	2016		2015
Premium	$	91,528	$	92,600
Self-funded group receivables		57,728		73,552
FEHBP		14,321		13,859
Agent balances		25,495		25,424
Accrued interest		13,668		12,624
Reinsurance recoverable		58,295		48,506
Other		62,637		53,325
		323,672		319,890
Less allowance for doubtful receivables:
Premium		27,320		28,944
Other		9,987		8,300
		37,307		37,244
Premium and other receivables, net	$	286,365	$	282,646

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Deferred Policy Acquisition Costs and Value of Business Acquired (Tables)

12 Months Ended

Dec. 31, 2016

Deferred Policy Acquisition Costs and Value of Business Acquired [Abstract]

Schedule of Movement of Deferred Policy Acquisition Costs and Value of Business Acquired

The movement of deferred policy acquisition costs (DPAC) and value of business acquired (VOBA) for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	DPAC			VOBA			Total
Balance, December 31, 2013	$	140,928		$	36,361		$	177,289
Additions		48,723			-			48,723
VOBA interest at an average rate of 5.17%		-			1,726			1,726
Amortization		(37,895	)		(5,743	)		(43,638	)
Net change		10,828			(4,017	)		6,811
Balance, December 31, 2014		151,756			32,344			184,100
Additions		48,599			-			48,599
VOBA interest at an average rate of 5.15%		-			1,543			1,543
Amortization		(38,624	)		(4,970	)		(43,594	)
Net change		9,975			(3,427	)		6,548
Balance, December 31, 2015		161,731			28,917			190,648
Additions		47,742			-			47,742
VOBA interest at an average rate of 5.15%		-			1,381			1,381
Amortization		(40,848	)		(4,136	)		(44,984	)
Net change		6,894			(2,755	)		4,139
Balance, December 31, 2016	$	168,625		$	26,162		$	194,787

Schedule of Expected Amortized Cost of VOBA

The estimated amount of the year-end VOBA balance expected to be amortized during the next five years is as follows:

Year ending December 31:
2017	$	3,582
2018		2,597
2019		2,279
2020		2,009
2021		2,075

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Property and Equipment, Net (Tables)

12 Months Ended

Dec. 31, 2016

Property and Equipment, Net [Abstract]

Property and Equipment, Net

Property and equipment, net as of December 31 are composed of the following:

	2016		2015
Land	$	10,976	$	10,976
Buildings and leasehold improvements		64,828		63,967
Office furniture and equipment		24,234		22,869
Computer equipment and software		114,749		113,223
Automobiles		593		494
		215,380		211,529
Less accumulated depreciation and amortization		149,011		137,576
Property and equipment, net	$	66,369	$	73,953

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Fair Value Measurements (Tables)

12 Months Ended

Dec. 31, 2016

Fair Value Measurements [Abstract]

Fair Value Measurements by Level for Assets Measured at Fair Value on a Recurring Basis

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	41,514	$	-	$	41,514
U.S. Treasury securities and obligations of U.S. government instrumentalities		85,800		-		-		85,800
Obligations of the Commonwealth of Puerto Rico and its instrumentalities		-		20,051		-		20,051
Municipal securities		-		683,803		-		683,803
Corporate Bonds		-		274,872		-		274,872
Residential agency mortgage-backed securities		-		718		-		718
Collaterized mortgage obligations		-		44,885		-		44,885
Total fixed maturities		85,800		1,065,843		-		1,151,643
Equity securities - Mutual funds		166,595		76,222		27,532		270,349
	$	252,395	$	1,142,065	$	27,532	$	1,421,992

	2015
	Level 1		Level 2		Level 3		Total
Securities available for sale
Fixed maturity securities
Obligations of government-sponsored enterprises	$	-	$	116,240	$	-	$	116,240
U.S. Treasury securities and obligations of U.S. government instrumentalities		163,270		-		-		163,270
Obligations of the Commonwealth of
Puerto Rico and its instrumentalities		-		25,619		-		25,619
Municipal securities		-		647,446		-		647,446
Corporate Bonds		-		157,408		-		157,408
Residential agency mortgage-backed securities		-		937		-		937
Collaterized mortgage obligations		-		22,725		-		22,725
Total fixed maturities		163,270		970,375		-		1,133,645
Equity securities - Mutual funds		167,082		22,031		7,958		197,071
	$	330,352	$	992,406	$	7,958	$	1,330,716

Reconciliation of Assets Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3)

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31 is as follows:

	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	2016			2015			2014
Balance as of January 1,	$	7,958		$	13,349		$	17,910
Realized gains		324			1,538			2,552
Unrealized in other accumulated comprehensive income		(1,458	)		(4,207	)		(2,937	)
Purchases		23,991			1,207			501
Sales		-			-			-
Capital Distributions		(3,283	)		(3,929	)		(4,677	)
Balance as of December 31,	$	27,532		$	7,958		$	13,349

Carrying Value and Fair Value by Level of Financial Instruments not Recorded at Fair Value on Consolidated Balance Sheet

A summary of the carrying value and fair value by level of financial instruments not recorded at fair value on our consolidated balance sheets at December 31, 2016 and 2015 are as follows:

	2016
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	8,564	$	-	$	8,564	$	-	$	8,564
Liabilities:
Policyholder deposits	$	179,382	$	-	$	179,382	$	-	$	179,382
Long-term borrowings:
Loans payable to bank - variable		11,187		-		11,187		-		11,187
6.6% senior unsecured notes payable		24,000		-		24,000		-		24,000
Total long-term borrowings		35,187		-		35,187		-		35,187
Total liabilities	$	214,569	$	-	$	214,569	$	-	$	214,569

	2015
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
Assets:
Policy loans	$	7,901	$	-	$	7,901	$	-	$	7,901
Liabilities:
Policyholder deposits	$	179,287	$	-	$	179,287	$	-	$	179,287
Long-term borrowings:
Loans payable to bank - variable		12,827		-		12,827		-		12,827
6.6% senior unsecured notes payable		24,000		-		19,920		-		19,920
Total long-term borrowings		36,827		-		32,747		-		32,747
Total liabilities	$	216,114	$	-	$	212,034	$	-	$	212,034

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Claim Liabilities and Claim Adjustment Expenses (Tables)

12 Months Ended

Dec. 31, 2016

Claims Development [Line Items]

Reconciliation of Beginning and Ending Balances of Claim Liabilities

A reconciliation of the beginning and ending balances of claim liabilities in 2016, 2015 and 2014 is as follows:

	2016
	Managed Care			Other  Business Segments *			Consolidated
Claim liabilities at beginning of year	$	348,297		$	143,468		$	491,765
Reinsurance recoverable on claim liabilities		-			(40,714	)		(40,714	)
Net claim liabilities at beginning of year		348,297			102,754			451,051
Claims incurred
Current period insured events		2,356,594			103,049			2,459,643
Prior period insured events		(9,047	)		(7,157	)		(16,204	)
Total		2,347,547			95,892			2,443,439
Payments of losses and loss-adjustment
expenses
Current period insured events		2,083,552			58,091			2,141,643
Prior period insured events		263,245			40,657			303,902
Total		2,346,797			98,748			2,445,545
Net claim liabilities at end of year		349,047			99,898			448,945
Reinsurance recoverable on claim liabilities		-			38,998			38,998
Claim liabilities at end of year	$	349,047		$	138,896		$	487,943

	2015
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	249,330		$	140,756		$	390,086
Reinsurance recoverable on claim liabilities		-			(40,635	)		(40,635	)
Net claim liabilities at beginning of year		249,330			100,121			349,451
Claims incurred
Current period insured events		2,216,330			98,279			2,314,609
Prior period insured events		(19,637	)		(1,211	)		(20,848	)
Total		2,196,693			97,068			2,293,761
Payments of losses and loss-adjustment
expenses
Current period insured events		1,868,607			52,369			1,920,976
Prior period insured events		229,119			42,066			271,185
Total		2,097,726			94,435			2,192,161
Net claim liabilities at end of year		348,297			102,754			451,051
Reinsurance recoverable on claim liabilities		-			40,714			40,714
Claim liabilities at end of year	$	348,297		$	143,468		$	491,765

	2014
	Managed Care			Other Business Segments *			Consolidated
Claim liabilities at beginning of year	$	283,615		$	136,806		$	420,421
Reinsurance recoverable on claim liabilities		-			(37,557	)		(37,557	)
Net claim liabilities at beginning of year		283,615			99,249			382,864
Claims incurred
Current period insured events		1,665,255			95,944			1,761,199
Prior period insured events		(36,160	)		(1,251	)		(37,411	)
Total		1,629,095			94,693			1,723,788
Payments of losses and loss-adjustment
expenses
Current period insured events		1,449,224			50,422			1,499,646
Prior period insured events		214,156			43,399			257,555
Total		1,663,380			93,821			1,757,201
Net claim liabilities at end of year		249,330			100,121			349,451
Reinsurance recoverable on claim liabilities		-			40,635			40,635
Claim liabilities at end of year	$	249,330		$	140,756		$	390,086

* Other Business Segments include the Life Insurance and Property and Casualty segments, as well as intersegment eliminations.

Supplementary Information about Average Percentage Payout of Incurred Claims by Age

The following table includes the annual percentage payout of incurred claims by age, net of reinsurance, for property and casualty segment as supplementary information as of December 31, 2016:

	(unaudited) 2007			(unaudited) 2008			(unaudited) 2009			(unaudited) 2010			(unaudited) 2011			(unaudited) 2012			(unaudited) 2013			(unaudited) 2014			(unaudited) 2015			(unaudited) 2016
Average		45.6	%		21.6	%		11.9	%		7.1	%		4.8	%		2.9	%		1.5	%		0.7	%		0.6	%		0.7	%

Reconciliation of Net Incurred and Paid Claims Development

The reconciliation of the net incurred and paid claims development tables, by segment, to the liability for claims and claim adjustment expenses in the consolidated balance sheets is as follows:

	As of December 31, 2016
Net outstanding liabilities
Managed Care	$	349,047
Property and Casualty		71,091
Other short-duration insurance lines		102
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		420,240
Reinsurance recoverable on unpaid claims - Property and Casualty		25,885
Insurance lines other than short-duration		42,757
Intersegment Elimination		(939	)
Total gross liability for unpaid claims and claim adjustment expense	$	487,943

Managed Care [Member]

Claims Development [Line Items]

Incurred and Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance

The Company estimates its liabilities for unpaid claims following a detailed actuarial process that entails using both historical claim payment patterns as well as emerging medical cost trends to project a best estimate of claim liabilities. This process includes comparing the historical claims incurred dates to the actual dates on claims payment.  Completion factors are applied to claims paid through the financial statements date to estimate the claim expense incurred for the current period.  The liability for claim adjustment expenses consists of adjustments made by our actuaries based on their knowledge and their estimate of emerging impacts to benefit costs and payment speed.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance					As of December 31, 2016
	Incurred amount						(in thousands)
Incurred Year	(unaudited) 2015			2016	Total of IBNR Liabilities Plus Expected Development on Reported Claims		Cumulative Number of Reported Claims
2015	$	2,216,330		2,207,283		75,431		17,830
2016				2,356,592		273,040		16,633
	Total		$	4,563,875

Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year	(unaudited) 2015			2016
2015	$	1,868,607		2,131,852
2016				2,083,552
	Total		$	4,215,404
All outstanding liabilities before 2015, net of reinsurance				576
Liabilities for claims and claim adjustment expenses, net of reinsurance			$	349,047

Property and Casualty Insurance [Member]

Claims Development [Line Items]

Incurred and Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance

Claims liability for property and casualty represents individual case estimates for reported claims and estimates for unreported losses, net of any salvage and subrogation based on past experience modified for current trends and estimates of expense for investigating and setting claims.

Incurred Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance																					As of December 31, 2016
Incurred Year	Incurred amount																				Total of IBNR Plus Expected Development on Reported Claims		Cumulative Number of reported claims
	(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)		(unaudited)
	2007		2008		2009		2010		2011		2012		2013		2014		2015		2016
2007	$	51,531	$	49,555	$	47,673	$	45,836	$	45,380	$	45,654	$	45,534	$	45,534	$	45,515	$	45,604	$	27		15,762
2008				49,095		48,812		46,443		45,941		45,541		47,658		45,909		45,535		45,571		142		16,089
2009						51,778		51,760		50,848		51,298		51,564		51,315		51,485		51,293		177		18,013
2010								54,226		54,090		55,266		56,400		57,115		57,386		57,242		482		20,918
2011										51,315		50,287		51,105		50,776		51,895		52,099		656		20,222
2012												49,040		49,856		48,900		49,817		48,945		1,565		22,366
2013														52,343		51,030		49,606		49,168		2,274		22,045
2014																48,430		45,410		43,707		3,377		20,085
2015																		45,067		40,175		6,160		18,912
2016																				48,127		16,806		19,897
																	Total		$	481,931

Cumulative Paid claims and Allocated Claim Adjustment Expenses, Net of Reinsurance
Incurred Year
	(unaudited) 2007		(unaudited) 2008		(unaudited) 2009		(unaudited) 2010		(unaudited) 2011		(unaudited) 2012		(unaudited) 2013		(unaudited) 2014		(unaudited) 2015		2016
2007	$	20,912	$	31,298	$	36,287	$	39,477	$	41,918	$	43,203	$	44,007	$	44,470	$	44,835	$	45,133
2008				23,715		32,834		37,420		40,332		41,847		43,787		44,426		44,703		44,867
2009						23,843		35,327		41,810		45,838		48,637		49,709		50,196		50,371
2010								27,118		38,964		45,409		49,808		52,890		54,027		54,996
2011										24,534		34,835		41,606		44,996		47,908		49,598
2012												22,677		33,620		40,406		43,663		45,607
2013														21,376		33,249		38,979		42,840
2014																18,752		28,657		33,809
2015																		17,063		24,935
2016																				20,099
																			$	412,255
										All Outstanding liabilities before 2007, net of reinsurance										1,415
										Liabilities for claims and claims adjustment expenses, net of reinsurance									$	71,091

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Long-Term Borrowings (Tables)

12 Months Ended

Dec. 31, 2016

Long-Term Borrowings [Abstract]

Summary of Long-Term Borrowings

A summary of the borrowings entered by the Company as of December 31 is as follows:

	2016		2015
Senior unsecured notes payable of $60,000 issued on
December 2005; due December 2020. Interest is payable monthly at a fixed rate of 6.60%.	$	24,000	$	24,000
Secured loan payable of $41,000, payable in monthly installments of $137 through July 1, 2024, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.23% at December 31, 2015.)		-		12,827
Secured loan payable of $11,187, payable in monthly installments of $137 through October 1, 2023, plus interest at a rate reset periodically of 100 basis points over selected LIBOR maturity (which was 1.77% at December 31, 2016.)		11,187		-
Total borrowings		35,187		36,827
Less unamortized debt issuance costs		102		-
	$	35,085	$	36,827

Aggregate Maturities of Company's Long Term Borrowings

Aggregate maturities of the Company’s borrowings as of December 31, 2016 are summarized as follows:

Year ending December 31
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
	$	35,187

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Reinsurance Activity (Tables)

12 Months Ended

Dec. 31, 2016

Reinsurance Activity [Abstract]

Effect of Reinsurance on Premiums Earned and Claims Incurred

The effect of reinsurance on premiums earned and claims incurred is as follows:

	Premiums Earned									Claims Incurred(1)
	2016			2015			2014			2016			2015			2014
Gross	$	2,949,673		$	2,847,288		$	2,199,351		$	2,458,447		$	2,313,191		$	1,748,972
Ceded		(59,032	)		(64,134	)		(70,785	)		(15,008	)		(19,430	)		(25,184	)
Net	$	2,890,641		$	2,783,154		$	2,128,566		$	2,443,439		$	2,293,761		$	1,723,788

⁽¹⁾ The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,806 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

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Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Income Taxes [Abstract]

Components of Income Tax Expense (Benefit)

The components of income tax (benefit) expense consisted of the following:

	2016			2015			2014
Current income tax expense	$	1,981		$	10,169		$	22,551
Deferred income tax benefit		(8,326	)		(5,070	)		(21,806	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

Schedule of Income Tax Expense (Benefit) Reconciliation

The income tax (benefit) expense differs from the amount computed by applying the Puerto Rico statutory income tax rate to the income before income taxes as a result of the following:

	2016			2015			2014
Income before taxes	$	11,086		$	57,131		$	66,051
Statutory tax rate		39.00	%		39.00	%		39.00	%
Income tax expense at statutory rate		4,324			22,281			25,760
Increase (decrease) in taxes resulting from
Exempt interest income, net		(5,158	)		(6,041	)		(7,139	)
Effect of taxing life insurance operations as a qualified domestic life insurance company instead of as a regular corporation		(5,033	)		(4,936	)		(5,572	)
Effect of taxing capital gains at a preferential rate		(3,799	)		(7,432	)		(14,248	)
Dividends received deduction		-			270			173
Adjustment to deferred tax assets and liabilities for changes in effective tax rates		1,669			(1,576	)		5,466
Other adjustments to deferred tax assets and liabilities		2,852			(58	)		(707	)
Effect of extraordinary dividend distribution from the Association - reported net of taxes in other income		(151	)		(875	)		-
Tax credit benefit		(709	)		(537	)		(1,482	)
Tax returns to provision true up		(181	)		(1,084	)		-
Effect of reassessment of unused credits for alternative minimum taxes paid		-			-			(6,486	)
Subtotal		(10,510	)		(22,269	)		(29,995	)
Other permanent disallowances, net:
Disallowed resolution agreements expense		-			1,716			-
Disallowance of expenses related to exempt interest income		58			-			46
Disallowed dividend received deduction		-			3,598			4,815
Disallowed interest expense		8			12			21
Other		-			61			282
Total other permanent differences		66			5,387			5,164
Other adjustments		(225	)		(300	)		(184	)
Total income tax (benefit) expense	$	(6,345	)	$	5,099		$	745

Summary of Deferred Tax Assets and Liabilities

The net deferred tax asset at December 31, 2016 and 2015 of the Company and its subsidiaries is composed of the following:

	2016			2015
Deferred tax assets
Allowance for doubtful receivables	$	10,070		$	13,434
Liability for pension benefits		10,624			21,416
Employee benefits plan		1,580			3,177
Postretirement benefits		772			1,252
Deferred compensation		2,041			1,818
Accumulated depreciation		1,137			1,240
Impairment loss on investments		2,035			1,749
Contingency reserves		-			30
Share-based compensation		4,393			4,875
Alternative minimum income tax credit		1,991			2,066
Purchased tax credits		6,062			931
Net operating loss		33,081			12,721
Difference in tax basis of investments portfolio		3,049			6,843
Accrued liabilities		2,133			2,402
Other		772			591
Gross deferred tax assets		79,740			74,545
Less: valuation allowance		(8,016	)		(7,839	)
Deferred tax assets		71,724			66,706
Deferred tax liabilities
Deferred policy acquisition costs		(6,621	)		(3,673	)
Catastrophe loss reserve		(8,020	)		(7,664	)
Unrealized gain on securities available for sale		(15,804	)		(15,021	)
Unamortized debt issue costs		(152	)		(29	)
Intangible asset		(2,195	)		(3,013	)
Accumulated depreciation		(14	)		(15	)
Gross deferred tax liabilities		(32,806	)		(29,415	)
Net deferred tax asset	$	38,918		$	37,291

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Pension Plans (Tables)

12 Months Ended

Dec. 31, 2016

Pension Plans [Abstract]

Schedule of Plan's Benefit Obligations, Fair Value of Plan Assets, and Funded Status

The following table sets forth the plan’s benefit obligations, fair value of plan assets, and funded status as of December 31, 2016 and 2015, accordingly:

	2016			2015
Change in benefit obligation
Benefit obligation at beginning of year	$	184,782		$	205,254
Service cost		3,640			4,137
Interest cost		8,749			8,281
Benefit payments		(12,911	)		(7,591	)
Actuarial (gain) loss		14,709			(25,299	)
Liability gain due to curtailment		(35,092	)		-
Benefit obligation at end of year	$	163,877		$	184,782
Accumulated benefit obligation at end of year	$	163,877		$	152,851
Change in fair value of plan assets
Fair value of plan assets at beginning of year	$	130,061		$	128,108
Actual return on assets		13,248			1,544
Employer contributions		10,000			8,000
Benefit payments		(12,911	)		(7,591	)
Fair value of plan assets at end of year	$	140,398		$	130,061
Funded status at end of year	$	(23,479	)	$	(54,721	)
Amounts in accumulated other comprehensive income not yet recognized as a component of net periodic pension cost
Development of prior service credit
Balance at beginning of year	$	(2,223	)	$	(2,673	)
Amortization		450			450
Curtailment/Settlement		1,773			-
Net prior service credit		-			(2,223	)
Development of actuarial loss
Balance at beginning of year		55,716			80,118
Amortization		(4,028	)		(5,939	)
(Gain)/Loss arising during the year		10,464			(18,463	)
Curtailment/Settlement gain during the year		(35,092	)		-
Actuarial net loss		27,060			55,716
Sum of deferrals	$	27,060		$	53,493
Net amount recognized	$	3,581		$	(1,228	)

Assumptions Used on Weighted Average Basis to Determine Benefits Obligations and Computing the Periodic Benefit Cost

The following assumptions were used on a weighted average basis to determine benefits obligations of the plan as of December 31, 2016 and 2015.

	2016			2015
Discount rate		4.50	%		4.75	%
Rate of compensation increase		N/A		Graded; 3.50		%
				to 8.00		%

The following assumptions were used on a weighted average basis in computing the periodic benefit cost for the years ended December 31, 2016, 2015, and 2014:

	2016			2015			2014
Discount rate		4.75	%		4.25	%		5.25	%
Expected return on plan assets		7.00	%		7.00	%		7.00	%
Rate of compensation increase	Graded; 3.50		%	Graded; 3.50		%	Graded; 3.50		%
	to 8.00		%	to 8.00		%	to 8.00		%

Schedule of Amounts Recognized in Balance Sheet

The amounts recognized in the balance sheets as of December 31, 2016 and 2015 consist of the following:

	2016		2015
Pension liability	$	23,479	$	54,721
Accumulated other comprehensive loss, net of a deferred tax of $7,191 and $17,500 in 2016 and 2015, respectively		19,869		35,993

Schedule of Components of Net Periodic Benefit

The components of net periodic benefit cost for 2016, 2015, and 2014 were as follows:

	2016			2015			2014
Components of net periodic benefit cost
Service cost	$	3,640		$	4,137		$	3,589
Interest cost		8,749			8,281			8,287
Expected return on plan assets		(9,003	)		(8,380	)		(7,496	)
Prior service benefit		(450	)		(450	)		(450	)
Actuarial loss		4,028			5,939			4,134
Net periodic benefit cost	$	6,964		$	9,527		$	8,064

Schedule of Fair Value Measurements by Level

The following table summarizes fair value measurements by level at December 31, 2016 and 2015 for assets measured at fair value on a recurring basis:

	2016
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	6,276		$	-	$	6,276
Non-agency backed securities		-		715			-		715
Corporate obligations		-		7,243			-		7,243
Partnership/Joint venture		-		-			932		932
Limited Liability Corporations		-		98,188			-		98,188
Real estate		-		-			6,617		6,617
Registered investments		3,839		1,869			-		5,708
Common/Collective trusts		-		7,334			-		7,334
Hedge funds		-		4,581			-		4,581
Common stocks		1,515		1			-		1,516
Preferred stocks		107		12			-		119
Forward foreign currency contracts		-		(1	)		-		(1	)
Interest-bearing cash		2,224		-			-		2,224
Derivatives		-		27			-		27
	$	7,685	$	126,245		$	7,549	$	141,479

	2015
	Level 1		Level 2			Level 3		Total
Government obligations	$	-	$	9,009		$	-	$	9,009
Non-agency backed securities		-		745			-		745
Corporate obligations		-		10,865			-		10,865
Partnership/Joint venture		-		-			567		567
Limited Liability Corporations		-		60,417			-		60,417
Real estate		-		-			5,929		5,929
Registered investments		6,224		5,927			-		12,151
Common/Collective trusts		-		16,479			-		16,479
Hedge funds		-		8,284			-		8,284
Common stocks		1,985		-			-		1,985
Preferred stocks		121		-			-		121
Forward foreign currency contracts		-		3			-		3
Interest-bearing cash		550		-			-		550
Derivatives		-		(28	)		-		(28	)
	$	8,880	$	111,701		$	6,496	$	127,077

Schedule of Assets Measured at Fair Value on a Recurring Basis using Significant Unobservable Inputs (Level 3)

A reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the year ended December 31, 2016 and 2015 is as follows:

	Government Obligations		Corporate Obligations		Partnership/ Joint Venture			Real Estate			Hedge Funds		Total
Beginning balance at December 31, 2014	$	.		.		1,097			6,197			-	$	7,294
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		103			384			-		487
Relating to assets sold during the period		-		-		(39	)		636			-		597
Purchases, issuances, and settlements		-		-		(594	)		(1,288	)		-		(1,882	)
Transfer in and/or out		-		-		-			-			-		-
Ending balance at December 31, 2015		-		-		567			5,929			-		6,496
Actual return on program assets:
Relating to assets still held at the reporting date		-		-		19			501			-		520
Relating to assets sold during the period		-		-		1			72			-		73
Purchases, issuances, and settlements		-		-		345			324			-		669
Transfer in and/or out		-		-		-			(209	)		-		(209	)
Ending balance at December 31, 2016	$	-	$	-	$	932		$	6,617		$	-	$	7,549

Schedule of Expected Benefit Payments

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

Year ending December 31
2017	$	8,253
2018		8,748
2019		9,047
2020		9,322
2021		9,314
2022 – 2026		49,252

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Stock Repurchase Programs (Tables)

12 Months Ended

Dec. 31, 2016

Stock Repurchase Programs [Abstract]

Summary of Stock Repurchase Activity

The stock repurchase activity under stock repurchase programs for the years ended December 31, 2016, 2015, and 2014 is summarized as follows:

	2016						2015						2014
	Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased		Shares Repurchased		Average Share Price		Amount Repurchased
2015  $25,000 program		951,831	$	22.54	$	21,370		154,554	$	23.72	$	3,629		-	$	-	$	-
2014  $50,000 program		-		-		-		2,086,532		21.69		44,658		228,525		23.55		5,341
2013  $11,500 program		-		-		-		-		-		-		367,700		16.32		5,995
Total		951,831	$	22.54	$	21,370		2,241,086	$	21.87	$	48,287		596,225	$	20.28	$	11,336

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Comprehensive Income (Tables)

12 Months Ended

Dec. 31, 2016

Comprehensive Income [Abstract]

Accumulated Balances of Other Comprehensive Income

The accumulated balances for each classification of other comprehensive income are as follows:

	Unrealized Gains on securities			Liability for Pension Benefits			Accumulated Other Comprehensive Income
Beginning balance at December 31, 2015	$	62,478		$	(36,855	)	$	25,623
Net current period change		14,761			15,728			30,489
Reclassification adjustments for gains and losses reclassified in income		(14,868	)		1,151			(13,717	)
Ending balance at December 31, 2016	$	62,371		$	(19,976	)	$	42,395

Summary of Related Deferred Tax Effects Allocated to Each Component of Other Comprehensive Income

The related deferred tax effects allocated to each component of other comprehensive income in the accompanying consolidated statements of stockholders’ equity and comprehensive income in 2016, 2015 and 2014 are as follows:

	2016
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	18,357		$	(3,596	)	$	14,761
Less reclassification adjustment for gains and losses realized in income		(17,379	)		2,511			(14,868	)
Net change in unrealized gain		978			(1,085	)		(107	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		1,888			(737	)		1,151
Net change arising from assumptions and plan changes and experience		25,783			(10,055	)		15,728
Net change in liability for pension benefits		27,671			(10,792	)		16,879
Net current period change	$	28,649		$	(11,877	)	$	16,772

	2015
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	(25,765	)	$	3,153		$	(22,612	)
Less reclassification adjustment for gains and losses realized in income		(18,941	)		2,564			(16,377	)
Net change in unrealized gain		(44,706	)		5,717			(38,989	)
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		6,020			(2,348	)		3,672
Net change arising from assumptions and plan changes and experience		19,940			(7,776	)		12,164
Net change in liability for pension benefits		25,960			(10,124	)		15,836
Net current period change	$	(18,746	)	$	(4,407	)	$	(23,153	)

	2014
	Before-Tax Amount			Deferred Tax (Expense) Benefit			Net-of-Tax Amount
Unrealized holding gains on securities arising during the period	$	58,831		$	(8,161	)	$	50,670
Less reclassification adjustment for gains and losses realized in income		(18,231	)		3,444			(14,787	)
Net change in unrealized gain		40,600			(4,717	)		35,883
Liability for pension benefits:
Reclassification adjustment for amortization of net losses from past experience and prior service costs		3,737			(1,457	)		2,280
Net change arising from assumptions and plan changes and experience		(35,271	)		13,755			(21,516	)
Net change in liability for pension benefits		(31,534	)		12,298			(19,236	)
Net current period change	$	9,066		$	7,581		$	16,647

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Share-Based Compensation (Tables)

12 Months Ended

Dec. 31, 2016

Share-Based Compensation [Abstract]

Summary of Stock Option Activity

Stock option activity during the year ended December 31, 2016 is as follows:

	Number of Shares			Weighted Average Exercise Price		Weighted Average Contractual Term (Years)		Aggregate Intrinsic Value
Outstanding balance at January 1, 2016		4,440		$	12.49
Exercised during the year		(4,440	)	$	12.49
Outstanding balance at December 31, 2016		-		$	-		N/A	$	-
Exercisable at December 31, 2016		-		$	-		N/A	$	-

Status of Entity's Nonvested Shares

A summary of the status of the Company’s nonvested restricted and performance shares as of December 31, 2016, and changes during the year ended December 31, 2016, are presented below:

	Restricted Awards					Performance Awards
	Number of Shares			Weighted Average Fair Value		Number of Shares			Weighted Average Exercise Price
Outstanding balance at January 1, 2016		156,331		$	19.45		495,005		$	17.84
Granted		110,181			23.78		234,121			23.85
Lapsed		(99,276	)		20.14		(89,171	)		16.17
Forfeited (due to termination)		(5,412	)		20.27		(60,218	)		16.67
Forfeited (due to performance payout less than 100%)		-			-		(121,542	)		18.61
Outstanding balance at December 31, 2016		161,824		$	21.94		458,195		$	21.44

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Net Income Available to Stockholders and Basic Net Income per Share (Tables)

12 Months Ended

Dec. 31, 2016

Net Income Available to Stockholders and Basic Net Income per Share [Abstract]

Computation of Basic and Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share for the three-year period ended December 31:

	2016		2015		2014
Numerator for earnings per share
Net income attributable to TSM available to stockholders	$	17,438	$	52,121	$	65,660
Denominator for basic earnings per share –
Weighted average of common shares		24,454,435		25,674,079		27,102,127
Effect of dilutive securities		56,658		87,662		86,705
Denominator for diluted earnings per share		24,511,093		25,761,741		27,188,832
Basic net income per share attributable to TSM	$	0.71	$	2.03	$	2.42
Diluted net income per share attributable to TSM	$	0.71	$	2.02	$	2.41

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Commitments (Tables)

12 Months Ended

Dec. 31, 2016

Commitments [Abstract]

Minimum Annual Rental Commitments

Minimum annual rental commitments at December 31, 2016 under existing agreements are summarized as follows:

Year ending December 31
2017	$	4,213
2018		3,936
2019		3,565
2020		2,345
2021		3,777
Total	$	17,836

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Statutory Accounting (Tables)

12 Months Ended

Dec. 31, 2016

Statutory Accounting [Abstract]

Unassigned Surplus and Net Income of the Regulated Subsidiaries

The following table sets forth the combined net admitted assets, capital and surplus, RBC requirement, which is our statutory capital and surplus requirement, and net income for the regulated subsidiaries at December 31, 2016, 2015 and 2014:

(dollar amounts in millions)	2016		2015		2014
Net admitted assets	$	1,829	$	1,881	$	1,734
Capital and surplus		638		691		659
RBC requirement		278		301		209
Net income		24		73		88

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Supplementary Information on Cash Flow Activities (Tables)

12 Months Ended

Dec. 31, 2016

Supplementary Information on Cash Flow Activities [Abstract]

Supplementary Information on Cash Flow Activities

	2016			2015			2014
Supplementary information
Noncash transactions affecting cash flow activities
Change in net unrealized (gain) loss on securities available for sale, including deferred income tax (asset)/liability of $1,085, $(5,717), and $4,717 in 2016, 2015, and 2014,respectively	$	107		$	38,989		$	(35,883	)
Change in liability for pension benefits, and deferred income tax (asset)/liability of $10,792, $10,124, $(12,298), in 2016, 2015, and 2014, respectively	$	(16,879	)	$	(15,836	)	$	19,236
Repurchase and retirement of common stock	$	(56	)	$	(182	)	$	(3,049	)
Exercise of stock options	$	55		$	179		$	2,885
Unsettled sales	$	-		$	-		$	10,456
Other
Income taxes paid	$	11,549		$	6,437		$	16,069
Interest paid	$	7,635		$	4,792		$	5,764

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Segment Information (Tables)

12 Months Ended

Dec. 31, 2016

Segment Information [Abstract]

Operating Revenues by Major Operating Segment

The following tables summarize the operations by operating segment for each of the years in the three‑year period ended December 31, 2016:

	2016			2015			2014
Operating revenues
Managed care
Premiums earned, net	$	2,647,169		$	2,548,270		$	1,894,791
Fee revenue		17,843			44,705			119,302
Intersegment premiums/fee revenue		5,918			5,860			5,681
Net investment income		15,102			11,779			15,010
Total managed care		2,686,032			2,610,614			2,034,784
Life
Premiums earned, net		156,140			147,864			142,245
Intersegment premiums		716			251			240
Net investment income		24,877			24,457			23,717
Total life		181,733			172,572			166,202
Property and casualty
Premiums earned, net		87,332			87,020			91,530
Intersegment premiums		613			613			613
Net investment income		8,891			8,706			8,600
Total property and casualty		96,836			96,339			100,743
Other segments*
Intersegment service revenues		9,907			10,863			9,100
Operating revenues from external sources		3,563			3,875			4,234
Total other segments		13,470			14,738			13,334
Total business segments		2,978,071			2,894,263			2,315,063
TSM operating revenues from external sources		19			53			95
Elimination of intersegment premiums		(7,247	)		(6,724	)		(6,534	)
Elimination of intersegment service revenue		(9,907	)		(10,863	)		(9,100	)
Other intersegment eliminations		(78	)		23			116
Consolidated operating revenues	$	2,960,858		$	2,876,752		$	2,299,640

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

Operating Income (Loss)

	2016			2015			2014
Operating (loss) income
Managed care	$	(36,777	)	$	20,514		$	31,445
Life		21,458			20,012			22,561
Property and casualty		12,074			8,273			10,044
Other segments*		(1,784	)		(301	)		(4,440	)
Total business segments		(5,029	)		48,498			59,610
TSM operating revenues from external sources		19			53			95
TSM unallocated operating expenses		(9,739	)		(18,858	)		(14,571	)
Elimination of TSM charges		9,522			9,623			9,717
Consolidated operating (loss) income		(5,227	)		39,316			54,851
Consolidated net realized investment gains		17,379			18,941			18,231
Consolidated interest expense		(7,635	)		(8,169	)		(9,274	)
Consolidated other income, net		6,569			7,043			2,243
Consolidated income before taxes	$	11,086		$	57,131		$	66,051

		2016		2015		2014
Depreciation and amortization expense
Managed care	$	11,114	$	13,268	$	17,935
Life		1,030		1,094		1,394
Property and casualty		544		673		994
Other segments*		645		556		3,264
Total business segments		13,333		15,591		23,587
TSM depreciation expense		787		788		813
Consolidated depreciation and amortization expense	$	14,120	$	16,379	$	24,400

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

Assets

	2016			2015			2014
Assets
Managed care	$	1,013,872		$	1,034,725		$	975,999
Life		816,920			770,721			764,268
Property and casualty		349,159			350,514			362,620
Other segments*		26,034			25,629			22,682
Total business segments		2,205,985			2,181,589			2,125,569
Unallocated amounts related to TSM
Cash, cash equivalents, and investments		17,033			12,304			44,157
Property and equipment, net		22,380			23,219			20,415
Other assets		21,646			31,732			37,851
		61,059			67,255			102,423
Elimination entries – intersegment receivables and others		(48,045	)		(42,699	)		(82,256	)
Consolidated total assets	$	2,218,999		$	2,206,145		$	2,145,736

Significant Noncash Items

		2016			2015			2014
Significant noncash items
Net change in unrealized gain (loss) on securities available for sale
Managed care	$	104		$	(15,505	)	$	6,055
Life		2,659			(13,005	)		22,349
Property and casualty		(2,984	)		(10,482	)		7,789
Other segments*		105			(10	)		-
Total business segments		(116	)		(39,002	)		36,193
Amount related to TSM		9			13			(310	)
Consolidated net change in unrealized gain (loss) on securities available for sale	$	(107	)	$	(38,989	)	$	35,883

* Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

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Nature of Business (Details)	12 Months Ended
	Dec. 31, 2016 Region Subsidiary
Business Acquisition [Line Items]
Number of service regions	8
Number of other wholly owned subsidiaries | Subsidiary	2
ASES [Member]
Business Acquisition [Line Items]
Number of service regions	5
TSS [Member]
Business Acquisition [Line Items]
Number of service regions	2
Current administration period	12 months
Number of additional service regions whose administration was transferred in amendment	3
Extended administration period	9 months

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Significant Accounting Policies (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Cash Equivalents [Abstract]
Cash equivalents	$ 24,486	$ 113,040
Revenue Recognition [Abstract]
Managed care premiums grace period	2 months
Profit agreement percentage under risk based medicaid contract	2.50%
Profit proportion percentage	50.00%
Deferred Policy Acquisition Costs and Value of Business Acquired [Abstract]
Interest rate associated with amortization of deferred policy acquisition cost	5.15%		4.90%
Long-Lived Assets, including Goodwill [Abstract]
Impairment charge			$ 2,221
Policyholder Deposits [Abstract]
Interest on policy holder deposits	$ 3,182	3,379	3,510
Liability for future policy benefits	321,232	289,530
Health Insurance Providers Fee [Abstract]
Final annual fee assessment	$ 44,100	$ 34,500	$ 27,700
Minimum [Member]
Deferred Policy Acquisition Costs and Value of Business Acquired [Abstract]
Interest rate associated with amortization of deferred policy acquisition cost		4.50%
Future Policy Benefits [Abstract]
Interest rate for future policy benefits	3.90%
Policyholder Deposits [Abstract]
Interest rates credited to policyholder account balances	1.25%	2.00%
Maximum [Member]
Deferred Policy Acquisition Costs and Value of Business Acquired [Abstract]
Interest rate associated with amortization of deferred policy acquisition cost		4.90%
Future Policy Benefits [Abstract]
Interest rate for future policy benefits	5.75%
Policyholder Deposits [Abstract]
Interest rates credited to policyholder account balances	4.50%	4.50%
Building [Member] | Minimum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	20 years
Building [Member] | Maximum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	50 years
Building Improvements [Member] | Minimum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	3 years
Building Improvements [Member] | Maximum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	5 years
Leasehold Improvements [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated useful life leasehold improvement	Shorter of estimated useful life or lease term
Office Furniture [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	5 years
Computer Software [Member] | Minimum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	3 years
Computer Software [Member] | Maximum [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	10 years
Computer Equipment, Equipment, and Automobiles [Member]
Summary of the estimated useful lives of the entity's property and equipment [Abstract]
Estimated Useful Life	3 years
Universal Life and Interest Sensitive Products [Member]
Policyholder Deposits [Abstract]
Liability for future policy benefits	$ 69,445	$ 62,840

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Investment in Securities, Amortized Cost and Estimated Fair Value by Major Security Type and Class of Security (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	$ 1,104,303	$ 1,088,258
Gross Unrealized Gains	48,894	46,474
Gross Unrealized Losses	(1,554)	(1,087)
Estimated Fair Value	1,151,643	1,133,645
Available-for-sale equity securities, amortized cost basis [Abstract]
Amortized Cost	240,699	169,593
Estimated Fair Value	270,349	197,071
Available-for-sale securities, amortized cost basis [Abstract]
Amortized Cost	1,345,002	1,257,851
Gross Unrealized Gains	78,995	74,325
Gross Unrealized Losses	(2,005)	(1,460)
Estimated Fair Value	1,421,992	1,330,716
Securities held to maturity [Abstract]
Amortized Cost	2,836	2,929
Gross Unrealized Gains	176	195
Gross Unrealized Losses	0	0
Estimated Fair Value	3,012	3,124
Obligations of Government-sponsored Enterprises [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	41,442	115,965
Gross Unrealized Gains	87	301
Gross Unrealized Losses	(15)	(26)
Estimated Fair Value	41,514	116,240
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	85,652	163,322
Gross Unrealized Gains	157	234
Gross Unrealized Losses	(9)	(286)
Estimated Fair Value	85,800	163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	17,930	25,302
Gross Unrealized Gains	2,189	317
Gross Unrealized Losses	(68)	0
Estimated Fair Value	20,051	25,619
Municipal Securities [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	650,175	612,225
Gross Unrealized Gains	34,187	35,418
Gross Unrealized Losses	(559)	(197)
Estimated Fair Value	683,803	647,446
Corporate Bonds [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	263,351	148,198
Gross Unrealized Gains	12,182	9,782
Gross Unrealized Losses	(661)	(572)
Estimated Fair Value	274,872	157,408
Residential Mortgage-Backed Securities [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	684	883
Gross Unrealized Gains	34	54
Gross Unrealized Losses	0	0
Estimated Fair Value	718	937
Collateralized Mortgage Obligations [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Amortized Cost	45,069	22,363
Gross Unrealized Gains	58	368
Gross Unrealized Losses	(242)	(6)
Estimated Fair Value	44,885	22,725
Mutual Funds [Member]
Available-for-sale debt securities, amortized cost basis [Abstract]
Estimated Fair Value	11,582	13,189	$ 0
Available-for-sale equity securities, amortized cost basis [Abstract]
Amortized Cost	240,699	169,593
Gross Unrealized Gains	30,101	27,851
Gross Unrealized Losses	(451)	(373)
Estimated Fair Value	270,349	197,071
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member]
Securities held to maturity [Abstract]
Amortized Cost	619	620
Gross Unrealized Gains	158	178
Gross Unrealized Losses	0	0
Estimated Fair Value	777	798
Residential Mortgage-Backed Securities [Member]
Securities held to maturity [Abstract]
Amortized Cost	191	191
Gross Unrealized Gains	18	17
Gross Unrealized Losses	0	0
Estimated Fair Value	209	208
Certificates of Deposits [Member]
Securities held to maturity [Abstract]
Amortized Cost	2,026	2,118
Gross Unrealized Gains	0	0
Gross Unrealized Losses	0	0
Estimated Fair Value	$ 2,026	$ 2,118

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Investment in Securities, Securities in Continuous Unrealized Loss Position (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($) Security	Dec. 31, 2015 USD ($) Security	Dec. 31, 2014 USD ($)
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	$ 274,219	$ 240,407
12 months or longer	784	0
Total	275,003	240,407
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(2,002)	(1,460)
12 months or longer	(3)	0
Total	$ (2,005)	$ (1,460)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	54	29
12 months or longer | Security	1	0
Total | Security	55	29
Minimum percentage of gross unrealized investment losses as cost	20.00%
Minimum unrealized loss of investment as indicator of other-than-temporary impairment	$ 100
Estimated Fair Value	1,151,643	$ 1,133,645
Impairment losses from other-than-temporary impairments	1,434	5,212	$ 1,170
Obligations of Government-sponsored Enterprises [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	9,483	18,989
12 months or longer	0	0
Total	9,483	18,989
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(15)	(26)
12 months or longer	0	0
Total	$ (15)	$ (26)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	1	1
12 months or longer | Security	0	0
Total | Security	1	1
Estimated Fair Value	$ 41,514	$ 116,240
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	12,937	130,996
12 months or longer	0	0
Total	12,937	130,996
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(9)	(286)
12 months or longer	0	0
Total	$ (9)	$ (286)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	1	5
12 months or longer | Security	0	0
Total | Security	1	5
Estimated Fair Value	$ 85,800	$ 163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	7,758
12 months or longer	0
Total	7,758
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(68)
12 months or longer	0
Total	$ (68)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	5
12 months or longer | Security	0
Total | Security	5
Estimated Fair Value	$ 20,051	25,619
Municipal Securities [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	84,252	43,937
12 months or longer	0	0
Total	84,252	43,937
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(559)	(197)
12 months or longer	0	0
Total	$ (559)	$ (197)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	13	11
12 months or longer | Security	0	0
Total | Security	13	11
Estimated Fair Value	$ 683,803	$ 647,446
Corporate Bonds [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	105,054	35,718
12 months or longer	0	0
Total	105,054	35,718
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(661)	(572)
12 months or longer	0	0
Total	$ (661)	$ (572)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	22	9
12 months or longer | Security	0	0
Total | Security	22	9
Estimated Fair Value	$ 274,872	$ 157,408
Collateralized Mortgage Obligations [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	32,120	1,448
12 months or longer	784	0
Total	32,904	1,448
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(239)	(6)
12 months or longer	(3)	0
Total	$ (242)	$ (6)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	8	1
12 months or longer | Security	1	0
Total | Security	9	1
Estimated Fair Value	$ 44,885	$ 22,725
Fixed Maturities Securities [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	251,604	231,088
12 months or longer	784	0
Total	252,388	231,088
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(1,551)	(1,087)
12 months or longer	(3)	0
Total	$ (1,554)	$ (1,087)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	50	27
12 months or longer | Security	1	0
Total | Security	51	27
Impairment losses from other-than-temporary impairments	$ 0	$ 4,267	1,170
Mutual Funds [Member]
Available-for-sale securities, continuous unrealized loss position, estimated fair value [Abstract]
Less than 12 months	22,615	9,319
12 months or longer	0	0
Total	22,615	9,319
Available-for-sale securities, continuous unrealized loss position, gross unrealized loss [Abstract]
Less than 12 months	(451)	(373)
12 months or longer	0	0
Total	$ (451)	$ (373)
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Less than 12 months | Security	4	2
12 months or longer | Security	0	0
Total | Security	4	2
Estimated Fair Value	$ 11,582	$ 13,189	0
Impairment losses from other-than-temporary impairments	1,434	945	0
Escrow Bonds [Member]
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Estimated Fair Value	7,758
Gross unrealized gains (losses)	(68)
Cofina Bonds [Member]
Available-for-sale, securities in unrealized loss positions, number of securities [Abstract]
Estimated Fair Value	12,293
Impairment losses from other-than-temporary impairments	0	$ 4,267	$ 1,170
Gross unrealized gains (losses)	$ 2,189

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Investment in Securities, Maturities of Investment Securities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Securities Available for Sale, Amortized Cost [Abstract]
Due in one year or less, Amortized Cost	$ 11,010
Due after one year through five, Amortized Cost	343,904
Due after five year through ten years, Amortized Cost	144,748
Due after ten years, Amortized Cost	558,888
Residential mortgage-backed securities, Amortized Cost	684
Collateralized mortgage obligations, Amortized Cost	45,069
Amortized Cost	1,104,303	$ 1,088,258
Securities available for sale, Estimated Fair Value [Abstract]
Due in one year or less, Estimated Fair Value	11,116
Due after one year through five, Estimated Fair Value	347,140
Due after five year through ten years, Estimated Fair Value	152,225
Due after ten years, Estimated Fair Value	595,559
Residential mortgage-backed securities, Estimated Fair Value	718
Collateralized mortgage obligations, Estimated Fair Value	44,885
Total, estimated fair value	1,151,643	1,133,645
Securities held to maturity, Amortized Cost [Abstract]
Due in one year or less, Amortized Cost	2,026
Due after ten years, Amortized Cost	619
Residential mortgage-backed securities, Amortized Cost	191
Amortized Cost	2,836	2,929
Securities held to maturity, Estimated Fair Value [Abstract]
Due in one year or less, Estimated Fair Value	2,026
Due after ten years, Estimated Fair Value	777
Residential mortgage-backed securities, Estimated Fair Value	209
Total, Estimated fair value	3,012	3,124
Amortized cost of deposited with commissioner of insurance code	5,358	5,136
Fair value of deposited with commissioner of insurance code	$ 5,788	$ 5,276

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Investment in Securities, Realized Gains and Losses from Investments (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($) Investment	Dec. 31, 2015 USD ($) Investment	Dec. 31, 2014 USD ($)
Securities available for sale [Abstract]
Gross losses from other-than-temporary impairments	$ (1,434)	$ (5,212)	$ (1,170)
Net realized gains on securities available for sale	17,379	18,941	16,806
Gross gain from other investment	0	0	1,425
Total net realized investment gains on sale of securities	17,379	18,941	18,231
Recognized in accumulated other comprehensive income [Abstract]
Available-for-sale securities	4,125	(44,706)	40,600
Not recognized in the consolidated financial statements [Abstract]
Deferred tax asset (liability) on unrealized gains (losses)	$ (1,085)	$ 5,717	(4,717)
Number of individual investment in securities exceeding 10% of stockholders' equity | Investment	0	0
Fixed Maturities Securities [Member]
Securities available for sale [Abstract]
Gross gains from sales	$ 3,086	$ 8,208	5,118
Gross losses from sales	(2,744)	(646)	(5,884)
Gross losses from other-than-temporary impairments	0	(4,267)	(1,170)
Gross realized gains (losses)	342	3,295	(1,936)
Recognized in accumulated other comprehensive income [Abstract]
Available-for-sale securities	1,953	(25,227)	46,220
Not recognized in the consolidated financial statements [Abstract]
Held to maturity	(19)	(24)	49
Equity Securities [Member]
Securities available for sale [Abstract]
Gross gains from sales	19,674	17,903	20,848
Gross losses from sales	(1,203)	(1,312)	(2,106)
Gross losses from other-than-temporary impairments	(1,434)	(945)	0
Gross realized gains (losses)	17,037	15,646	18,742
Recognized in accumulated other comprehensive income [Abstract]
Available-for-sale securities	$ 2,172	$ (19,479)	$ (5,620)

XML

Net Investment Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	$ 48,913	$ 45,174	$ 47,540
Fixed Maturities [Member]
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	37,139	36,256	38,559
Equity Securities [Member]
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	9,666	7,146	7,660
Policy Loans [Member]
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	619	557	545
Cash Equivalents and Interest-Bearing Deposits [Member]
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	257	143	117
Other [Member]
Interest and/or dividend income from [Abstract]
Interest and/or dividend income	$ 1,232	$ 1,072	$ 659

XML

Premium and Other Receivables, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Premiums and Other Receivables [Line Items]
Premium	$ 91,528	$ 92,600
Self-funded group receivables	57,728	73,552
FEHBP	14,321	13,859
Agent balances	25,495	25,424
Accrued interest	13,668	12,624
Reinsurance recoverable	58,295	48,506
Other	62,637	53,325
Premiums and other receivables, total	323,672	319,890
Less allowance for doubtful receivables [Abstract]
Premium	27,320	28,944
Other	9,987	8,300
Premiums and other receivables, allowance	37,307	37,244
Premium and other receivables, net	286,365	282,646
Government of Puerto Rico [Member]
Premiums and Other Receivables [Line Items]
Premiums and other receivables, total	57,750	78,230
Less allowance for doubtful receivables [Abstract]
Premiums and other receivables, allowance	$ 18,812	$ 19,133

XML

Deferred Policy Acquisition Costs and Value of Business Acquired (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
DPAC [Roll Forward]
Balance, beginning of period	$ 161,731	$ 151,756	$ 140,928
Additions	47,742	48,599	48,723
VOBA interest	0	0	0
Amortization	(40,848)	(38,624)	(37,895)
Net change	6,894	9,975	10,828
Balance, end of period	168,625	161,731	151,756
VOBA [Roll Forward]
Balance, beginning of period	28,917	32,344	36,361
Additions	0	0	0
VOBA interest	1,381	1,543	1,726
Amortization	(4,136)	(4,970)	(5,743)
Net change	(2,755)	(3,427)	(4,017)
Balance, end of period	26,162	28,917	32,344
TOTAL [Roll Forward]
Balance, beginning of period	190,648	184,100	177,289
Additions	47,742	48,599	48,723
VOBA interest	1,381	1,543	1,726
Amortization	(44,984)	(43,594)	(43,638)
Net change	4,139	6,548	6,811
Balance, end of period	$ 194,787	$ 190,648	$ 184,100
VOBA interest rate	5.15%	5.15%	5.17%
Portion of DPAC and VOBA amortization recorded within unrealized gains on securities component of other comprehensive income	$ 3,147
Value of business acquired future amortization expense [Abstract]
2017	3,582
2018	2,597
2019	2,279
2020	2,009
2021	$ 2,075

XML

Property and Equipment, Net (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	$ 215,380	$ 211,529
Less accumulated depreciation and amortization	149,011	137,576
Property and equipment, net	66,369	73,953
Land [Member]
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	10,976	10,976
Buildings and Leasehold Improvements [Member]
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	64,828	63,967
Office Furniture and Equipment [Member]
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	24,234	22,869
Computer Equipment and Software [Member]
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	114,749	113,223
Automobiles [Member]
Summary of Property and equipment, net [Abstract]
Property and equipment, gross	$ 593	$ 494

XML

Goodwill (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Goodwill [Abstract]
Goodwill	$ 25,397	$ 25,397
Goodwill impairment charge	$ 2,369	$ 2,369

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Fair Value Measurements, Fair Value Measurements by Level for Assets Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Securities available for sale [Abstract]
Fixed maturities	$ 1,151,643	$ 1,133,645
Equity securities	270,349	197,071
Total	5,788	5,276
Obligations of Government-sponsored Enterprises [Member]
Securities available for sale [Abstract]
Fixed maturities	41,514	116,240
U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member]
Securities available for sale [Abstract]
Fixed maturities	85,800	163,270
Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member]
Securities available for sale [Abstract]
Fixed maturities	20,051	25,619
Municipal Securities [Member]
Securities available for sale [Abstract]
Fixed maturities	683,803	647,446
Corporate Bonds [Member]
Securities available for sale [Abstract]
Fixed maturities	274,872	157,408
Residential Agency Mortgage-backed Securities [Member]
Securities available for sale [Abstract]
Fixed maturities	718	937
Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Fixed maturities	44,885	22,725
Mutual Funds [Member]
Securities available for sale [Abstract]
Fixed maturities	11,582	13,189	$ 0
Equity securities	270,349	197,071
Fair Value, Measurements, Recurring [Member]
Securities available for sale [Abstract]
Fixed maturities	1,151,643	1,133,645
Total	1,421,992	1,330,716
Fair Value, Measurements, Recurring [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	85,800	163,270
Total	252,395	330,352
Fair Value, Measurements, Recurring [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	1,065,843	970,375
Total	1,142,065	992,406
Fair Value, Measurements, Recurring [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Total	27,532	7,958
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member]
Securities available for sale [Abstract]
Fixed maturities	41,514	116,240
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	41,514	116,240
Fair Value, Measurements, Recurring [Member] | Obligations of Government-sponsored Enterprises [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member]
Securities available for sale [Abstract]
Fixed maturities	85,800	163,270
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	85,800	163,270
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | U.S. Treasury Securities and Obligations of U.S. Government Instrumentalities [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member]
Securities available for sale [Abstract]
Fixed maturities	20,051	25,619
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	20,051	25,619
Fair Value, Measurements, Recurring [Member] | Obligations of the Commonwealth of Puerto Rico and its instrumentalities [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member]
Securities available for sale [Abstract]
Fixed maturities	683,803	647,446
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	683,803	647,446
Fair Value, Measurements, Recurring [Member] | Municipal Securities [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member]
Securities available for sale [Abstract]
Fixed maturities	274,872	157,408
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	274,872	157,408
Fair Value, Measurements, Recurring [Member] | Corporate Bonds [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member]
Securities available for sale [Abstract]
Fixed maturities	718	937
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	718	937
Fair Value, Measurements, Recurring [Member] | Residential Agency Mortgage-backed Securities [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member]
Securities available for sale [Abstract]
Fixed maturities	44,885	22,725
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Fixed maturities	44,885	22,725
Fair Value, Measurements, Recurring [Member] | Collateralized Mortgage Obligations [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Fixed maturities	0	0
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member]
Securities available for sale [Abstract]
Equity securities	270,349	197,071
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 1 [Member]
Securities available for sale [Abstract]
Equity securities	166,595	167,082
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 2 [Member]
Securities available for sale [Abstract]
Equity securities	76,222	22,031
Fair Value, Measurements, Recurring [Member] | Mutual Funds [Member] | Level 3 [Member]
Securities available for sale [Abstract]
Equity securities	$ 27,532	$ 7,958

XML

Fair Value Measurements, Reconciliation of Assets Measured at Fair Value Using Significant Unobservable Inputs (Level 3) (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Level 1 to level 2 transfers	$ 0	$ 0
Level 2 to level 1 transfers	0	0
Fair Value, Measurements, Recurring [Member]
Reconciliation of assets measured at fair value on a recurring basis using significant unobservable inputs [Roll Forward]
Beginning balance	7,958	13,349	$ 17,910
Realized gains	324	1,538	2,552
Unrealized in other accumulated comprehensive income	(1,458)	(4,207)	(2,937)
Purchases	23,991	1,207	501
Sales	0	0	0
Capital distributions	(3,283)	(3,929)	(4,677)
Ending balance	$ 27,532	$ 7,958	$ 13,349

XML

Fair Value Measurements, Summary of Carrying Value and Fair Value by Level of Financial Instruments Not Recorded at Fair Value (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Debt instrument, fixed interest rate	6.60%	6.60%
Carrying Value [Member]
Assets [Abstract]
Policy loans	$ 8,564	$ 7,901
Liabilities [Abstract]
Policyholder deposits	179,382	179,287
Long-term borrowings	35,187	36,827
Total liabilities	214,569	216,114
Carrying Value [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member]
Liabilities [Abstract]
Long-term borrowings	11,187	12,827
Carrying Value [Member] | Notes Payable [Member] | 6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Long-term borrowings	24,000	24,000
Fair Value [Member]
Assets [Abstract]
Policy loans	8,564	7,901
Liabilities [Abstract]
Policyholder deposits	179,382	179,287
Long-term borrowings	35,187	32,747
Total liabilities	214,569	212,034
Fair Value [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member]
Liabilities [Abstract]
Long-term borrowings	11,187	12,827
Fair Value [Member] | Notes Payable [Member] | 6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Long-term borrowings	24,000	19,920
Fair Value [Member] | Level 1 [Member]
Assets [Abstract]
Policy loans	0	0
Liabilities [Abstract]
Policyholder deposits	0	0
Long-term borrowings	0	0
Total liabilities	0	0
Fair Value [Member] | Level 1 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member]
Liabilities [Abstract]
Long-term borrowings	0	0
Fair Value [Member] | Level 1 [Member] | Notes Payable [Member] | 6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Long-term borrowings	0	0
Fair Value [Member] | Level 2 [Member]
Assets [Abstract]
Policy loans	8,564	7,901
Liabilities [Abstract]
Policyholder deposits	179,382	179,287
Long-term borrowings	35,187	32,747
Total liabilities	214,569	212,034
Fair Value [Member] | Level 2 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member]
Liabilities [Abstract]
Long-term borrowings	11,187	12,827
Fair Value [Member] | Level 2 [Member] | Notes Payable [Member] | 6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Long-term borrowings	24,000	19,920
Fair Value [Member] | Level 3 [Member]
Assets [Abstract]
Policy loans	0	0
Liabilities [Abstract]
Policyholder deposits	0	0
Long-term borrowings	0	0
Total liabilities	0	0
Fair Value [Member] | Level 3 [Member] | Loans Payable [Member] | Loans Payable to Bank - Variable [Member]
Liabilities [Abstract]
Long-term borrowings	0	0
Fair Value [Member] | Level 3 [Member] | Notes Payable [Member] | 6.6% Senior Unsecured Notes Payable [Member]
Liabilities [Abstract]
Long-term borrowings	$ 0	$ 0

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Claim Liabilities and Claim Adjustment Expenses, Reconciliation of Beginning and Ending Balances of Claim Liabilities (Details) - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward]
Claim liabilities at beginning of year		$ 491,765	$ 390,086	$ 420,421
Reinsurance recoverable on claim liabilities		(40,714)	(40,635)	(37,557)
Net claim liabilities at beginning of year		451,051	349,451	382,864
Claims incurred [Abstract]
Current period insured events		2,459,643	2,314,609	1,761,199
Prior period insured events		(16,204)	(20,848)	(37,411)
Total		2,443,439	2,293,761	1,723,788
Payments of losses and loss-adjustment expenses [Abstract]
Current period insured events		2,141,643	1,920,976	1,499,646
Prior period insured events		303,902	271,185	257,555
Total		2,445,545	2,192,161	1,757,201
Net claim liabilities at end of year		448,945	451,051	349,451
Reinsurance recoverable on claim liabilities		38,998	40,714	40,635
Claim liabilities at end of year		487,943	491,765	390,086
Change in liability for future policy (benefits) expense		28,752	24,954	23,807
Managed Care [Member]
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward]
Claim liabilities at beginning of year		348,297	249,330	283,615
Reinsurance recoverable on claim liabilities		0	0	0
Net claim liabilities at beginning of year		348,297	249,330	283,615
Claims incurred [Abstract]
Current period insured events		2,356,594	2,216,330	1,665,255
Prior period insured events		(9,047)	(19,637)	(36,160)
Total		2,347,547	2,196,693	1,629,095
Payments of losses and loss-adjustment expenses [Abstract]
Current period insured events		2,083,552	1,868,607	1,449,224
Prior period insured events		263,245	229,119	214,156
Total		2,346,797	2,097,726	1,663,380
Net claim liabilities at end of year		349,047	348,297	249,330
Reinsurance recoverable on claim liabilities		0	0	0
Claim liabilities at end of year		349,047	348,297	249,330
Other Business Segments [Member]
Reconciliation of beginning and ending balances of claim liabilities [Roll Forward]
Claim liabilities at beginning of year	[1]	143,468	140,756	136,806
Reinsurance recoverable on claim liabilities	[1]	(40,714)	(40,635)	(37,557)
Net claim liabilities at beginning of year	[1]	102,754	100,121	99,249
Claims incurred [Abstract]
Current period insured events	[1]	103,049	98,279	95,944
Prior period insured events	[1]	(7,157)	(1,211)	(1,251)
Total	[1]	95,892	97,068	94,693
Payments of losses and loss-adjustment expenses [Abstract]
Current period insured events	[1]	58,091	52,369	50,422
Prior period insured events	[1]	40,657	42,066	43,399
Total	[1]	98,748	94,435	93,821
Net claim liabilities at end of year	[1]	99,898	102,754	100,121
Reinsurance recoverable on claim liabilities	[1]	38,998	40,714	40,635
Claim liabilities at end of year	[1]	$ 138,896	$ 143,468	$ 140,756

[1] Other Business Segments include the Life Insurance and Property and Casualty segments as well as intersegment eliminations.

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Claim Liabilities and Claim Adjustment Expenses, Incurred and Cumulative Paid Claims and Allocated Claim Adjustment Expenses, Net of Reinsurance (Details) $ in Thousands	Dec. 31, 2016 USD ($) Claim	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)	Dec. 31, 2013 USD ($)	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2009 USD ($)	Dec. 31, 2008 USD ($)	Dec. 31, 2007 USD ($)
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Liabilities for claims and claim adjustment expenses, net of reinsurance	$ 420,240
Managed Care [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	4,563,875
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	4,215,404
All outstanding liabilities, net of reinsurance	576
Liabilities for claims and claim adjustment expenses, net of reinsurance	349,047
Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	481,931
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	412,255
All outstanding liabilities, net of reinsurance	1,415
Liabilities for claims and claim adjustment expenses, net of reinsurance	71,091
Other Short-duration Insurance Line [Member]
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Liabilities for claims and claim adjustment expenses, net of reinsurance	102
Incurred Year 2007 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	45,604	$ 45,515	$ 45,534	$ 45,534	$ 45,654	$ 45,380	$ 45,836	$ 47,673	$ 49,555	$ 51,531
Total of IBNR liabilities plus expected development on reported claims	$ 27
Cumulative number of reported claims | Claim	15,762
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 45,133	44,835	44,470	44,007	43,203	41,918	39,477	36,287	31,298	$ 20,912
Incurred Year 2008 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	45,571	45,535	45,909	47,658	45,541	45,941	46,443	48,812	49,095
Total of IBNR liabilities plus expected development on reported claims	$ 142
Cumulative number of reported claims | Claim	16,089
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 44,867	44,703	44,426	43,787	41,847	40,332	37,420	32,834	$ 23,715
Incurred Year 2009 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	51,293	51,485	51,315	51,564	51,298	50,848	51,760	51,778
Total of IBNR liabilities plus expected development on reported claims	$ 177
Cumulative number of reported claims | Claim	18,013
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 50,371	50,196	49,709	48,637	45,838	41,810	35,327	$ 23,843
Incurred Year 2010 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	57,242	57,386	57,115	56,400	55,266	54,090	54,226
Total of IBNR liabilities plus expected development on reported claims	$ 482
Cumulative number of reported claims | Claim	20,918
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 54,996	54,027	52,890	49,808	45,409	38,964	$ 27,118
Incurred Year 2011 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	52,099	51,895	50,776	51,105	50,287	51,315
Total of IBNR liabilities plus expected development on reported claims	$ 656
Cumulative number of reported claims | Claim	20,222
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 49,598	47,908	44,996	41,606	34,835	$ 24,534
Incurred Year 2012 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	48,945	49,817	48,900	49,856	49,040
Total of IBNR liabilities plus expected development on reported claims	$ 1,565
Cumulative number of reported claims | Claim	22,366
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 45,607	43,663	40,406	33,620	$ 22,677
Incurred Year 2013 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	49,168	49,606	51,030	52,343
Total of IBNR liabilities plus expected development on reported claims	$ 2,274
Cumulative number of reported claims | Claim	22,045
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 42,840	38,979	33,249	$ 21,376
Incurred Year 2014 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	43,707	45,410	48,430
Total of IBNR liabilities plus expected development on reported claims	$ 3,377
Cumulative number of reported claims | Claim	20,085
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 33,809	28,657	$ 18,752
Incurred Year 2015 [Member] | Managed Care [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	2,207,283	2,216,330
Total of IBNR liabilities plus expected development on reported claims	$ 75,431
Cumulative number of reported claims | Claim	17,830
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 2,131,852	1,868,607
Incurred Year 2015 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	40,175	45,067
Total of IBNR liabilities plus expected development on reported claims	$ 6,160
Cumulative number of reported claims | Claim	18,912
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 24,935	$ 17,063
Incurred Year 2016 [Member] | Managed Care [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	2,356,592
Total of IBNR liabilities plus expected development on reported claims	$ 273,040
Cumulative number of reported claims | Claim	16,633
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 2,083,552
Incurred Year 2016 [Member] | Property and Casualty [Member]
Insurance Claims Development, Net of Reinsurance [Abstract]
Incurred claims and allocated claim adjustment expenses, net of reinsurance	48,127
Total of IBNR liabilities plus expected development on reported claims	$ 16,806
Cumulative number of reported claims | Claim	19,897
Cumulative Paid Claims Development, Net of Reinsurance [Abstract]
Cumulative paid claims and allocated claim adjustment expenses, net of reinsurance	$ 20,099

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Claim Liabilities and Claim Adjustment Expenses, Supplementary Information about Average Percentage Payout of Incurred Claims by Age (Details) - Property and Casualty [Member]	Dec. 31, 2016
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance [Abstract]
2007	45.60%
2008	21.60%
2009	11.90%
2010	7.10%
2011	4.80%
2012	2.90%
2013	1.50%
2014	0.70%
2015	0.60%
2016	0.70%

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Claim Liabilities and Claim Adjustment Expenses, Reconciliation of Net Incurred and Paid Claims Development (Details) - USD ($) $ in Thousands		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Net Outstanding Liabilities [Abstract]
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		$ 420,240
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Total gross liability for unpaid claims and claim adjustment expense		487,943	$ 491,765	$ 390,086	$ 420,421
Intersegment Elimination [Member]
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Reinsurance recoverable on unpaid claims		(939)
Managed Care [Member]
Net Outstanding Liabilities [Abstract]
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		349,047
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Total gross liability for unpaid claims and claim adjustment expense		349,047	348,297	249,330	283,615
Property and Casualty [Member]
Net Outstanding Liabilities [Abstract]
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		71,091
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Reinsurance recoverable on unpaid claims		25,885
Other Segments [Member]
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Total gross liability for unpaid claims and claim adjustment expense	[1]	138,896	$ 143,468	$ 140,756	$ 136,806
Other Short-duration Insurance Line [Member]
Net Outstanding Liabilities [Abstract]
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance		102
Insurance Lines Other Than Short-duration [Member]
Reconciliation of Claims Development to Liability Reinsurance Recoverable on Unpaid Claims [Abstract]
Reinsurance recoverable on unpaid claims		$ 42,757

[1] Other Business Segments include the Life Insurance and Property and Casualty segments as well as intersegment eliminations.

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Federal Employees' Health Benefits (FEHBP) and Federal Employees' (FEP) Programs (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Federal Employees' Health Benefits (FEHBP) and Federal Employees' (FEP) Programs [Abstract]
Federal employees health benefits program funds	$ 50,789	$ 42,572
Contingency reserve	26,180	28,417
Proceed from contingency reserve	6,687	$ 4,763	$ 12,766
Federal employees programs funds overdraft	$ 1,812

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Long-Term Borrowings (Details) $ in Thousands		12 Months Ended
	Dec. 28, 2016 USD ($) Loan	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)
Summary of long-term borrowings [Abstract]
Total borrowings		$ 35,187	$ 36,827
Less unamortized debt issuance costs		102	0
Long-term borrowings		35,085	36,827
Aggregate maturities of Company's long term borrowings [Abstract]
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
Total borrowings		35,187	36,827
Interest expense on borrowings		1,763	2,435	$ 3,639
Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due December 2020 [Member]
Summary of long-term borrowings [Abstract]
Total borrowings		24,000	24,000
Debt instrument, principal amount		$ 60,000
Debt instrument, maturity date		Dec. 31, 2020
Debt instrument, fixed interest rate		6.60%
Aggregate maturities of Company's long term borrowings [Abstract]
Total borrowings		$ 24,000	24,000
Debt instrument, period of prepayment at par		5 years
Secured Debt [Member] | Secured Loans Payable, Due July 2024 [Member]
Summary of long-term borrowings [Abstract]
Total borrowings		$ 0	12,827
Debt instrument, principal amount			$ 41,000
Debt instrument, maturity date			Jul. 01, 2024
Debt instrument, monthly installment payment			$ 137
Basis spread on variable rate			1.00%
Debt instrument, variable interest rate			1.23%
Aggregate maturities of Company's long term borrowings [Abstract]
Total borrowings		0	$ 12,827
Secured Debt [Member] | Secured Loans Payable, Due October 2023 [Member]
Summary of long-term borrowings [Abstract]
Total borrowings		11,187	0
Debt instrument, principal amount		$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Debt instrument, monthly installment payment		$ 137
Basis spread on variable rate		1.00%
Debt instrument, variable interest rate		1.77%
Aggregate maturities of Company's long term borrowings [Abstract]
Total borrowings		$ 11,187	$ 0
Commercial Bank in Puerto Rico [Member]
Aggregate maturities of Company's long term borrowings [Abstract]
Maximum borrowing capacity	$ 35,500
Number of term loans issued | Loan	3
Proceeds from debt issuance used to fund portion of debt service reserve	$ 200
Commercial Bank in Puerto Rico [Member] | First Year [Member]
Aggregate maturities of Company's long term borrowings [Abstract]
Prepayment penalty fee percentage		3.00%
Commercial Bank in Puerto Rico [Member] | Second Year [Member]
Aggregate maturities of Company's long term borrowings [Abstract]
Prepayment penalty fee percentage		2.00%
Commercial Bank in Puerto Rico [Member] | Third Year [Member]
Aggregate maturities of Company's long term borrowings [Abstract]
Prepayment penalty fee percentage		1.00%
Commercial Bank in Puerto Rico [Member] | Term Loan A [Member]
Summary of long-term borrowings [Abstract]
Debt instrument, principal amount	$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Commercial Bank in Puerto Rico [Member] | Term Loan A [Member] | LIBOR [Member]
Summary of long-term borrowings [Abstract]
Basis spread on variable rate	1.00%
Commercial Bank in Puerto Rico [Member] | Term Loan B [Member]
Summary of long-term borrowings [Abstract]
Debt instrument, principal amount	$ 20,150
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Term Loan B [Member] | LIBOR [Member]
Summary of long-term borrowings [Abstract]
Basis spread on variable rate	2.75%
Commercial Bank in Puerto Rico [Member] | Term Loan C [Member]
Summary of long-term borrowings [Abstract]
Debt instrument, principal amount	$ 4,116
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Term Loan C [Member] | LIBOR [Member]
Summary of long-term borrowings [Abstract]
Basis spread on variable rate	3.25%
Commercial Bank in Puerto Rico [Member] | Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due January 2021 [Member]
Summary of long-term borrowings [Abstract]
Debt instrument, maturity date		Jan. 31, 2021
Debt instrument, fixed interest rate	6.60%
Aggregate maturities of Company's long term borrowings [Abstract]
Repaid principal amount of notes	$ 24,000

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Reinsurance Activity (Details) $ in Thousands		12 Months Ended
		Dec. 31, 2016 USD ($) Entity	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)
Premiums Earned [Abstract]
Gross		$ 2,949,673	$ 2,847,288	$ 2,199,351
Ceded		(59,032)	(64,134)	(70,785)
Net		2,890,641	2,783,154	2,128,566
Claims Incurred [Abstract]
Gross	[1]	2,458,447	2,313,191	1,748,972
Ceded	[1]	(15,008)	(19,430)	(25,184)
Net	[1]	2,443,439	2,293,761	1,723,788
Change in the liability for future policy benefits		$ 28,752	24,954	23,806
Effects of Reinsurance [Line Items]
Period of reinsurance contracts		1 year
Premiums ceded		$ 59,032	64,134	70,785
Claims ceded	[1]	15,008	19,430	25,184
TSP [Member]
Premiums Earned [Abstract]
Ceded		$ (45,957)	$ (48,676)	$ (52,058)
Effects of Reinsurance [Line Items]
Percentage of reinsurance business placed with one reinsurance entity		13.16%	14.06%	13.26%
Premiums ceded		$ 45,957	$ 48,676	$ 52,058
Ceded unearned reinsurance premiums		$ 9,202	10,291
TSP [Member] | Property Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Percentage of risk ceded to reinsurers		30.00%
Percentage of exposure covered by property		70.00%
TSP [Member] | Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		$ 175,000
TSP [Member] | Builders' Risk Quota Share [Member]
Effects of Reinsurance [Line Items]
Initial amount on which treaty provide protection on quota share basis		2,500
Amount of first surplus		12,500
Maximum amount of surplus		14,500
TSP [Member] | Surety Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered for contract surety bonds		5,000
Aggregate amount of claim covered for contract surety bonds per contractor		10,000
Amount of claim covered for miscellaneous surety bond		3,000
TSP [Member] | Personal Lines [Member] | Reinstatement Premium Protection [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		3,400
TSP [Member] | Commercial Lines [Member] | Reinstatement Premium Protection [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		10,000
TSP [Member] | Minimum [Member] | Property Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered under treaty covered by property		500
TSP [Member] | Minimum [Member] | Personal Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		5,000
TSP [Member] | Minimum [Member] | Commercial Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		10,000
TSP [Member] | Minimum [Member] | Casualty Excess of Loss Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		225
TSP [Member] | Minimum [Member] | Medical Malpractice Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		150
TSP [Member] | Minimum [Member] | Catastrophe [Member] | Property Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		8,000
TSP [Member] | Minimum [Member] | Personal Lines [Member] | Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		80,000
TSP [Member] | Maximum [Member] | Property Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		30,000
Amount of claim covered under treaty covered by property		21,000
TSP [Member] | Maximum [Member] | Personal Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		80,000
TSP [Member] | Maximum [Member] | Commercial Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		135,000
TSP [Member] | Maximum [Member] | Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		235,000
TSP [Member] | Maximum [Member] | Casualty Excess of Loss Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		12,000
TSP [Member] | Maximum [Member] | Medical Malpractice Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		3,000
TSP [Member] | Maximum [Member] | Catastrophe [Member] | Property Quota Share Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		15,000
TSP [Member] | Maximum [Member] | Commercial Lines [Member] | Property Catastrophe Excess of Loss [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		135,000
TSS [Member]
Premiums Earned [Abstract]
Ceded		(3,148)	(3,678)	(4,901)
Claims Incurred [Abstract]
Ceded		$ (1,700)	(2,665)	(5,487)
Effects of Reinsurance [Line Items]
Number of reinsurance entity with which subsidiary placed reinsurance business | Entity		1
Premiums ceded		$ 3,148	3,678	4,901
Claims ceded		$ 1,700	2,665	5,487
TSS [Member] | Organ Transplant Excess of Loss Treaty [Member]
Effects of Reinsurance [Line Items]
Percentage of claim covered		80.00%
Maximum amount of claim to be covered per person		$ 800
Maximum amount of claim to be covered, per person		200
Maximum amount of claim covered with other options for other groups, per person		$ 400
TSS [Member] | Retired Employees of the Commonwealth of Puerto Rico [Member]
Effects of Reinsurance [Line Items]
Percentage of claim covered		100.00%
Maximum amount of claim to be covered per person		$ 500
Maximum amount of claim covered with major medical coverage		$ 1,000
TSS [Member] | Municipalities of Puerto Rico [Member]
Effects of Reinsurance [Line Items]
Percentage of claim covered		100.00%
Maximum amount of claim to be covered per person		$ 250
Maximum amount of claim covered with life time limit		$ 1,000
TSS [Member] | U.S. Virgin Islands [Member]
Effects of Reinsurance [Line Items]
Percentage of claim covered		100.00%
Maximum amount of claim to be covered per person		$ 2,000
Amount of claim covered, per person		200
Excess amount reinsured		800
TSS [Member] | Maximum [Member] | Organ Transplant Excess of Loss Treaty [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		1,000
Maximum amount of claim to be covered, per person		250
Maximum amount of claim covered with other options for other groups, per person		500
TSV [Member]
Premiums Earned [Abstract]
Ceded		(8,838)	(9,596)	(10,328)
Effects of Reinsurance [Line Items]
Premiums ceded		$ 8,838	$ 9,596	10,328
Period for new and renewal business		12 months
Period of written notice for cancelation of agreement		90 days
TSV [Member] | Group Life Insurance Facultative Agreement [Member]
Effects of Reinsurance [Line Items]
Percentage of risk covered		50.00%
TSV [Member] | Facultative Pro rata Agreements [Member]
Effects of Reinsurance [Line Items]
Percentage of risk covered		65.00%
TSV [Member] | Several Reinsurance Agreements [Member]
Effects of Reinsurance [Line Items]
Maximum retention amount for excess of loss		$ 50
Retention limit amount		$ 200		$ 175
TSV [Member] | Quota share agreements [Member]
Effects of Reinsurance [Line Items]
Excess of loss agreements for group and individual major medical		40.00%
Amount of retention claims		$ 100
Percentage of retention claims		70.00%
TSV [Member] | Costa Rica reinsuring [Member]
Effects of Reinsurance [Line Items]
Percentage of excess of loss agreement		100.00%
Amount over excess of loss agreement		$ 25
TSV [Member] | Minimum [Member]
Effects of Reinsurance [Line Items]
Percentage of retrocession reinsurance agreements		6.70%
Agreement of reinsurer's gross liability		$ 50
TSV [Member] | Minimum [Member] | Group Life Insurance Facultative Agreement [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		25
TSV [Member] | Minimum [Member] | Quota share agreements [Member]
Effects of Reinsurance [Line Items]
Amount of claims		$ 100
TSV [Member] | Maximum [Member]
Effects of Reinsurance [Line Items]
Percentage of retrocession reinsurance agreements		15.00%
Agreement of reinsurer's gross liability		$ 500
TSV [Member] | Maximum [Member] | Group Life Insurance Facultative Agreement [Member]
Effects of Reinsurance [Line Items]
Amount of claim covered, per person		200
TSV [Member] | Maximum [Member] | Quota share agreements [Member]
Effects of Reinsurance [Line Items]
Amount of claims		$ 2,000

[1] The claims incurred disclosed in this table exclude the portion of the change in the liability for future policy benefits amounting to $28,752, $24,954, and $23,806 that is included within the consolidated claims incurred during the years ended December 31, 2016, 2015 and 2014, respectively.

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Income Taxes (Details) - USD ($) $ in Thousands	4 Months Ended	12 Months Ended
	Oct. 31, 2014	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Income Tax Examination [Line Items]
Limit on income tax credit for regular income tax in excess of alternative minimum income tax paid		25.00%
Federal income tax		$ 733	$ 574	$ 451
Total outside basis difference		26,000	59,000
One-time charge to operations		6,300
Components of income tax expense (benefit) [Abstract]
Current income tax expense		1,981	10,169	22,551
Deferred income tax benefit		(8,326)	(5,070)	(21,806)
Total income tax (benefit) expense		(6,345)	5,099	745
Income tax (benefit) expense reconciliation [Abstract]
Income before taxes		$ 11,086	$ 57,131	$ 66,051
Statutory tax rate		39.00%	39.00%	39.00%
Income tax expense at statutory rate		$ 4,324	$ 22,281	$ 25,760
Increase (decrease) in taxes resulting from [Abstract]
Exempt interest income, net		(5,158)	(6,041)	(7,139)
Effect of taxing life insurance operations as a qualified domestic life insurance company instead of as a regular corporation		(5,033)	(4,936)	(5,572)
Effect of taxing capital gains at a preferential rate		(3,799)	(7,432)	(14,248)
Dividends received deduction		0	270	173
Adjustment to deferred tax assets and liabilities for changes in effective tax rates		1,669	(1,576)	5,466
Other adjustments to deferred tax assets and liabilities		2,852	(58)	(707)
Effect of extraordinary dividend distribution from the Association - reported net of taxes in other income		(151)	(875)	0
Tax credit benefit		(709)	(537)	(1,482)
Tax returns to provision true up		(181)	(1,084)	0
Effect of reassessment of unused credits for alternative minimum taxes paid		0	0	(6,486)
Subtotal		(10,510)	(22,269)	(29,995)
Other permanent disallowances, net [Abstract]
Disallowed resolution agreements expense		0	1,716	0
Disallowance of expenses related to exempt interest income		58	0	46
Disallowed dividend received deduction		0	3,598	4,815
Disallowed interest expense		8	12	21
Other		0	61	282
Total other permanent differences		66	5,387	5,164
Other adjustments		(225)	(300)	(184)
Total income tax (benefit) expense		(6,345)	5,099	$ 745
Deferred tax assets [Abstract]
Allowance for doubtful receivables		10,070	13,434
Liability for pension benefits		10,624	21,416
Employee benefits plan		1,580	3,177
Postretirement benefits		772	1,252
Deferred compensation		2,041	1,818
Accumulated depreciation		1,137	1,240
Impairment loss on investments		2,035	1,749
Contingency reserves		0	30
Share-based compensation		4,393	4,875
Alternative minimum income tax credit		1,991	2,066
Purchased tax credits		6,062	931
Net operating loss		33,081	12,721
Difference in tax basis of investments portfolio		3,049	6,843
Accrued liabilities		2,133	2,402
Other		772	591
Gross deferred tax assets		79,740	74,545
Less: valuation allowance		(8,016)	(7,839)
Deferred tax assets		71,724	66,706
Deferred tax liabilities [Abstract]
Deferred policy acquisition costs		(6,621)	(3,673)
Catastrophe loss reserve		(8,020)	(7,664)
Unrealized gain on securities available for sale		(15,804)	(15,021)
Unamortized debt issue costs		(152)	(29)
Intangible asset		(2,195)	(3,013)
Accumulated depreciation		(14)	(15)
Gross deferred tax liabilities		(32,806)	(29,415)
Net deferred tax asset		38,918	37,291
Deferred tax assets, net		57,768	52,361
Deferred tax liabilities, net		$ 18,850	15,070
Puerto Rico [Member]
Income Tax Examination [Line Items]
Percentage of premium tax on policies underwritten		5.00%
Income tax prepayments at reduced rate	12.00%
Components of income tax expense (benefit) [Abstract]
Total income tax (benefit) expense			2,524
Other permanent disallowances, net [Abstract]
Total income tax (benefit) expense			$ 2,524
Deferred tax liabilities [Abstract]
Operating loss carryforwards		$ 75,000
Puerto Rico [Member] | Minimum [Member]
Income Tax Examination [Line Items]
Changes to the corporate tax		15.00%
Puerto Rico [Member] | Maximum [Member]
Income Tax Examination [Line Items]
Changes to the corporate tax		20.00%

XML

Pension Plans, Noncontributory Defined-Benefit Pension Plan (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Summary of amounts recognized in the balance sheets [Abstract]
Accumulated other comprehensive loss, deferred tax	$ 7,191	$ 17,500
Components of net periodic benefit cost [Abstract]
Settlement charges	0	0
Summary of estimated net loss and prior service benefit that will be amortized from accumulated other comprehensive loss into net periodic pension benefits cost during the next twelve months [Abstract]
Estimated net actuarial loss that will be amortized from accumulated other comprehensive loss into net periodic pension benefits cost during the next twelve months	$ 345
Noncontributory Defined-Benefit Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Requisite service period	5 years
Change in benefit obligation [Roll Forward]
Benefit obligation at beginning of year	$ 184,782	205,254
Service cost	3,640	4,137	$ 3,589
Interest cost	8,749	8,281	8,287
Benefit payments	(12,911)	(7,591)
Actuarial (gain) loss	14,709	(25,299)
Liability gain due to curtailment	(35,092)	0
Benefit obligation at end of year	163,877	184,782	205,254
Accumulated benefit obligation at end of year	163,877	152,851
Change in fair value of plan assets [Roll Forward]
Fair value of plan assets at beginning of year	130,061	128,108
Actual return on assets	13,248	1,544
Employer contributions	10,000	8,000
Benefit payments	(12,911)	(7,591)
Fair value of plan assets at end of year	140,398	130,061	128,108
Funded status at end of year	(23,479)	(54,721)
Amounts in accumulated other comprehensive income not yet recognized as a component of net periodic pension cost [Abstract]
Development of prior service credit, Balance at beginning of year	(2,223)	(2,673)
Amortization	450	450	450
Curtailment/Settlement	1,773	0
Net prior service credit	0	(2,223)	(2,673)
Development of actuarial loss, Balance at beginning of year	55,716	80,118
Amortization	(4,028)	(5,939)	(4,134)
(Gain)/Loss arising during the year	10,464	(18,463)
Curtailment/Settlement gain during the year	(35,092)	0
Actuarial net loss	27,060	55,716	80,118
Sum of deferrals	27,060	53,493
Net amount recognized	$ 3,581	$ (1,228)
Weighted average basis on benefits obligations [Abstract]
Discount rate	4.50%	4.75%
Summary of amounts recognized in the balance sheets [Abstract]
Pension liability	$ 23,479	$ 54,721
Accumulated other comprehensive loss, net of a deferred tax of $7,191 and $17,500 in 2016 and 2015, respectively	19,869	35,993
Components of net periodic benefit cost [Abstract]
Service cost	3,640	4,137	3,589
Interest cost	8,749	8,281	8,287
Expected return on assets	(9,003)	(8,380)	(7,496)
Prior service benefit	(450)	(450)	(450)
Actuarial loss	4,028	5,939	4,134
Net periodic benefit cost	$ 6,964	$ 9,527	$ 8,064
Weighted average basis on periodic benefit cost [Abstract]
Discount rate	4.75%	4.25%	5.25%
Expected return on plan assets	7.00%	7.00%	7.00%
Period over which annual rates of return are projected under target asset allocation	30 years
Expected rate of return on plan assets	7.00%	7.00%
Reduction in other administrative expenses	0.15%
Noncontributory Defined-Benefit Pension Plan [Member] | Minimum [Member]
Weighted average basis on benefits obligations [Abstract]
Rate of compensation increase		3.50%
Weighted average basis on periodic benefit cost [Abstract]
Rate of compensation increase	3.50%	3.50%	3.50%
Percentile range of assets allocation	35.00%
Expected rate of return on plan assets	5.70%
Noncontributory Defined-Benefit Pension Plan [Member] | Maximum [Member]
Weighted average basis on benefits obligations [Abstract]
Rate of compensation increase		8.00%
Weighted average basis on periodic benefit cost [Abstract]
Rate of compensation increase	8.00%	8.00%	8.00%
Percentile range of assets allocation	65.00%
Expected rate of return on plan assets	7.10%
Noncontributory Defined-Benefit Pension Plan [Member] | Equity Securities [Member]
Weighted average basis on periodic benefit cost [Abstract]
Target asset allocation minimum	44.00%
Target asset allocation maximum	56.00%
Noncontributory Defined-Benefit Pension Plan [Member] | Debt Securities [Member]
Weighted average basis on periodic benefit cost [Abstract]
Target asset allocation minimum	34.00%
Target asset allocation maximum	46.00%
Noncontributory Defined-Benefit Pension Plan [Member] | Other Securities [Member]
Weighted average basis on periodic benefit cost [Abstract]
Target asset allocation minimum	6.00%
Target asset allocation maximum	14.00%

XML

Pension Plans, Plan Assets (Details) - Noncontributory Defined-Benefit Pension Plan [Member] - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	$ 140,398	$ 130,061	$ 128,108
Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	141,479	127,077
Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,685	8,880
Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	126,245	111,701
Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,549	6,496	7,294
Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,549	6,496
Government Obligations [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	6,276	9,009
Government Obligations [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Government Obligations [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	6,276	9,009
Government Obligations [Member] | Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0	0
Government Obligations [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Non Agency Backed Securities [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	715	745
Non Agency Backed Securities [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Non Agency Backed Securities [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	715	745
Non Agency Backed Securities [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Corporate Obligations [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,243	10,865
Corporate Obligations [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Corporate Obligations [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,243	10,865
Corporate Obligations [Member] | Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0	0
Corporate Obligations [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Partnership/Joint venture [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	932	567
Partnership/Joint venture [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Partnership/Joint venture [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Partnership/Joint venture [Member] | Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	932	567	1,097
Partnership/Joint venture [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	932	567
Limited Liability Corporations [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	98,188	60,417
Limited Liability Corporations [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Limited Liability Corporations [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	98,188	60,417
Limited Liability Corporations [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Real Estate [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	6,617	5,929
Real Estate [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Real Estate [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Real Estate [Member] | Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	6,617	5,929	6,197
Real Estate [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	6,617	5,929
Registered Investments [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	5,708	12,151
Registered Investments [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	3,839	6,224
Registered Investments [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	1,869	5,927
Registered Investments [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Common/Collective Trusts [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,334	16,479
Common/Collective Trusts [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Common/Collective Trusts [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	7,334	16,479
Common/Collective Trusts [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Hedge Funds [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	4,581	8,284
Hedge Funds [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Hedge Funds [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	4,581	8,284
Hedge Funds [Member] | Level 3 [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0	$ 0
Hedge Funds [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Common Stock [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	1,516	1,985
Common Stock [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	1,515	1,985
Common Stock [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	1	0
Common Stock [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Preferred Stock [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	119	121
Preferred Stock [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	107	121
Preferred Stock [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	12	0
Preferred Stock [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Forward Foreign Currency Contracts [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	(1)	3
Forward Foreign Currency Contracts [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Forward Foreign Currency Contracts [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	(1)	3
Forward Foreign Currency Contracts [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Interest-bearing Cash [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	2,224	550
Interest-bearing Cash [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	2,224	550
Interest-bearing Cash [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Interest-bearing Cash [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Derivatives [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	27	(28)
Derivatives [Member] | Level 1 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	0	0
Derivatives [Member] | Level 2 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	27	(28)
Derivatives [Member] | Level 3 [Member] | Recurring [Member]
Fair value, assets measured on recurring basis [Abstract]
Assets, fair value	$ 0	$ 0

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Pension Plans, Reconciliation of Assets Measured at Fair Value on Recurring Basis Using Significant Unobservable Inputs (Level 3) (Details) - Noncontributory Defined-Benefit Pension Plan [Member] - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	$ 130,061	$ 128,108
Actual return on program assets [Abstract]
Fair value of plan assets at end of year	140,398	130,061
Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	6,496	7,294
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	520	487
Relating to assets sold during the period	73	597
Purchases, issuances, and settlements	669	(1,882)
Transfer in and/or out	(209)	0
Fair value of plan assets at end of year	7,549	6,496
Government Obligations [Member] | Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	0	0
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	0	0
Relating to assets sold during the period	0	0
Purchases, issuances, and settlements	0	0
Transfer in and/or out	0	0
Fair value of plan assets at end of year	0	0
Corporate Obligations [Member] | Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	0	0
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	0	0
Relating to assets sold during the period	0	0
Purchases, issuances, and settlements	0	0
Transfer in and/or out	0	0
Fair value of plan assets at end of year	0	0
Partnership/Joint venture [Member] | Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	567	1,097
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	19	103
Relating to assets sold during the period	1	(39)
Purchases, issuances, and settlements	345	(594)
Transfer in and/or out	0	0
Fair value of plan assets at end of year	932	567
Real Estate [Member] | Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	5,929	6,197
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	501	384
Relating to assets sold during the period	72	636
Purchases, issuances, and settlements	324	(1,288)
Transfer in and/or out	(209)	0
Fair value of plan assets at end of year	6,617	5,929
Hedge Funds [Member] | Level 3 [Member]
Summary of reconciliation of the beginning and ending balances of assets measured at fair value on a recurring basis using significant unobservable inputs (Level 3) [Abstract]
Fair value of plan assets at beginning of year	0	0
Actual return on program assets [Abstract]
Relating to assets still held at the reporting date	0	0
Relating to assets sold during the period	0	0
Purchases, issuances, and settlements	0	0
Transfer in and/or out	0	0
Fair value of plan assets at end of year	$ 0	$ 0

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Pension Plans, Cash Flows (Details) - Noncontributory Defined-Benefit Pension Plan [Member] $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($)
Defined Benefit Plan Disclosure [Line Items]
Expected employer future contributions	$ 4,000
Summary of expected benefit payments [Abstract]
2017	8,253
2018	8,748
2019	9,047
2020	9,322
2021	9,314
2022 - 2026	$ 49,252

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Pension Plans, Noncontributory Supplemental Pension Plan (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Defined Benefit Plan Disclosure [Line Items]
Pension liability	$ 30,892	$ 62,945
Noncontributory Supplemental Pension Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Pension liability	7,413	8,224
Accumulated other comprehensive loss related to noncontributory pension plan, net of tax	107	862
Accumulated other comprehensive loss related to noncontributory pension plan, tax	$ 73	$ 556

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Catastrophe Loss Reserve and Trust Fund (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015
Catastrophe Loss Reserve and Trust Fund [Abstract]
Maximum contribution rate which increases catastrophe reserve	5.00%
Minimum percentage of reserve to catastrophe exposure	8.00%
Interest earning assets	$ 47,630	$ 46,221
Restricted catastrophe loss reserve balance	$ 44,823	$ 43,041

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Stockholders' Equity (Details) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
	Nov. 12, 2015	Dec. 31, 2016	Dec. 31, 2015
Common Stock [Abstract]
Number of shares converted (in shares)	1,426,721
Preferred Stock [Abstract]
Preferred stock, shares authorized (in shares)		100,000,000
Preferred stock, par value (in dollars Per Share)		$ 1.00
Preferred stock, shares issued (in shares)		0	0
Preferred stock, shares outstanding (in shares)		0	0
Dividends [Abstract]
Pay surplus value of dividend		10.00%
Period after filing in which dividend not disapproved		30 days
Amount available for dividend distribution without prior approval from regulatory agency		$ 43,000

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Stock Repurchase Programs (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Nov. 30, 2015	Oct. 31, 2014	Jul. 31, 2013
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)	951,831	2,241,086	596,225
Average share price (in dollars per share)	$ 22.54	$ 21.87	$ 20.28
Amount repurchased	$ 21,370	$ 48,287	$ 11,336
2015 $25,000 Stock Repurchase Program [Member]
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)	951,831	154,554	0
Average share price (in dollars per share)	$ 22.54	$ 23.72	$ 0
Amount repurchased	$ 21,370	$ 3,629	$ 0
Stock repurchase, authorized amount				$ 25,000
2014 $50,000 Stock Repurchase Program [Member]
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)	0	2,086,532	228,525
Average share price (in dollars per share)	$ 0	$ 21.69	$ 23.55
Amount repurchased	$ 0	$ 44,658	$ 5,341
Stock repurchase, authorized amount					$ 50,000
2013 $11,500 Stock Repurchase Program [Member]
Equity, Class of Treasury Stock [Line Items]
Shares repurchased (in shares)	0	0	367,700
Average share price (in dollars per share)	$ 0	$ 0	$ 16.32
Amount repurchased	$ 0	$ 0	$ 5,995
Stock repurchase, authorized amount						$ 11,500

XML

Comprehensive Income (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	$ 846,856	$ 858,026	$ 785,203
Net current period change	30,489
Reclassification adjustments for gains and losses reclassified in income	(13,717)
Balance	862,486	846,856	858,026
Before-Tax Amount [Abstract]
Unrealized holding gains on securities arising during the period	18,357	(25,765)	58,831
Less reclassification adjustment for gains and losses realized in income	(17,379)	(18,941)	(18,231)
Net change in unrealized gain	978	(44,706)	40,600
Liability for pension benefits [Abstract]
Reclassification adjustment for amortization of net losses from past experience and prior service costs	1,888	6,020	3,737
Net change arising from assumptions and plan changes and experience	25,783	19,940	(35,271)
Net change in liability for pension benefits	27,671	25,960	(31,534)
Net current period change	28,649	(18,746)	9,066
Deferred Tax (Expense) Benefit [Abstract]
Unrealized holding gains on securities arising during the period	(3,596)	3,153	(8,161)
Less reclassification adjustment for gains and losses realized in income	2,511	2,564	3,444
Net change in unrealized gain	(1,085)	5,717	(4,717)
Liability for pension benefits [Abstract]
Reclassification adjustment for amortization of net losses from past experience and prior service costs	(737)	(2,348)	(1,457)
Net change arising from assumptions and plan changes and experience	(10,055)	(7,776)	13,755
Net change in liability for pension benefits	(10,792)	(10,124)	12,298
Net current period change	(11,877)	(4,407)	7,581
Net-of-Tax Amount [Abstract]
Unrealized holding gains on securities arising during the period	14,761	(22,612)	50,670
Less reclassification adjustment for gains and losses realized in income	(14,868)	(16,377)	(14,787)
Net change in unrealized gain	(107)	(38,989)	35,883
Liability for pension benefits [Abstract]
Reclassification adjustment for amortization of net losses from past experience and prior service costs	1,151	3,672	2,280
Net change arising from assumptions and plan changes and experience	15,728	12,164	(21,516)
Net change in liability for pension benefits	16,879	15,836	(19,236)
Net current period change	16,772	(23,153)	$ 16,647
Unrealized Gain on Securities [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	62,478
Net current period change	14,761
Reclassification adjustments for gains and losses reclassified in income	(14,868)
Balance	62,371	62,478
Liability for Pension Benefits [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	(36,855)
Net current period change	15,728
Reclassification adjustments for gains and losses reclassified in income	1,151
Balance	(19,976)	(36,855)
Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance	25,623
Balance	$ 42,395	$ 25,623

XML

Share-Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2007
Weighted Average Fair Value [Roll Forward]
Total unrecognized compensation cost related to nonvested share-based compensation	$ 6,785
Cost is expected to be recognized over a weighted average period	1 year 7 days
Stock Options [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods in equal annual installments	3 years
Number of Shares [Roll Forward]
Outstanding balance, beginning of period (in shares)	4,440
Exercised during the year (in shares)	(4,440)	(12,913)	(199,002)
Outstanding balance, end of period (in shares)	0	4,440
Exercisable, end of period (in shares)	0
Weighted Average Exercise Price [Roll Forward]
Outstanding balance, beginning of period (in dollars per share)	$ 12.49
Exercised during the year (in dollars per share)	12.49
Outstanding balance, end of period (in dollars per share)	0	$ 12.49
Exercisable, end of period (in dollars per share)	$ 0
Aggregate Intrinsic Value [Abstract]
Outstanding balance, end of period	$ 0
Exercisable, end of period	$ 0
Stock option grant in period (in shares)	0	0	0
Cash received from stock options exercises	$ 0	$ 0
Number of shares repurchased and retired as a result of non-cash exercise of stock options (in shares)	2,290	7,235	174,090
Stock Options [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration date cannot exceed	7 years
Restricted Awards [Member]
Number of Shares [Roll Forward]
Outstanding balance, beginning of period (in shares)	156,331
Granted (in shares)	110,181
Lapsed (in shares)	(99,276)
Forfeited (due to termination) (in shares)	(5,412)
Forfeited (due to performance payout less than 100%) (in shares)	0
Outstanding balance, end of period (in shares)	161,824	156,331
Weighted Average Fair Value [Roll Forward]
Outstanding balance, beginning of period (in dollars per share)	$ 19.45
Granted (in dollars per share)	23.78	$ 20.33	$ 16.46
Lapsed (in dollars per share)	20.14
Forfeited (due to termination) (in dollars per share)	20.27
Forfeited (due to performance payout less than 100%) (in dollars per share)	0
Outstanding balance, end of period (in dollars per share)	$ 21.94	$ 19.45
Total fair value of restricted stock vested	$ 2,335	$ 3,608	$ 1,146
Restricted Awards [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods in equal annual installments	1 year
Restricted Awards [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting periods in equal annual installments	3 years
Performance Awards [Member]
Number of Shares [Roll Forward]
Outstanding balance, beginning of period (in shares)	495,005
Granted (in shares)	234,121
Lapsed (in shares)	(89,171)
Forfeited (due to termination) (in shares)	(60,218)
Forfeited (due to performance payout less than 100%) (in shares)	(121,542)
Outstanding balance, end of period (in shares)	458,195	495,005
Weighted Average Fair Value [Roll Forward]
Outstanding balance, beginning of period (in dollars per share)	$ 17.84
Granted (in dollars per share)	23.85
Lapsed (in dollars per share)	16.17
Forfeited (due to termination) (in dollars per share)	16.67
Forfeited (due to performance payout less than 100%) (in dollars per share)	18.61
Outstanding balance, end of period (in dollars per share)	$ 21.44	$ 17.84
2007 Incentive Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares authorized under the plan (in shares)				4,700,000
Shares available to grant under the plan (in shares)	1,333,093	1,677,395

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Net Income Available to Stockholders and Basic Net Income per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Numerator for earnings per share [Abstract]
Net income attributable to TSM available to stockholders	$ 17,438	$ 52,121	$ 65,660
Denominator for basic earnings per share [Abstract]
Weighted average of common shares (in shares)	24,454,435	25,674,079	27,102,127
Effect of dilutive securities (in shares)	56,658	87,662	86,705
Denominator for diluted earnings per share (in shares)	24,511,093	25,761,741	27,188,832
Basic net income per share attributable to TSM (in dollars per share)	$ 0.71	$ 2.03	$ 2.42
Diluted net income per share attributable to TSM (in dollars per share)	$ 0.71	$ 2.02	$ 2.41

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Commitments (Details) $ in Thousands	1 Months Ended	12 Months Ended
	Dec. 31, 2015 USD ($)	Dec. 31, 2016 USD ($) Installment	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)
Summary of minimum annual rental commitments [Abstract]
2017		$ 4,213
2018		3,936
2019		3,565
2020		2,345
2021		3,777
Total		17,836
Rent Expense		$ 7,613	$ 7,730	$ 8,738
Extraordinary dividend declared	$ 21,000
Extraordinary dividend special tax rate	15.00%
Proceeds from association a special distribution			$ 1,672
Number of installments for dividend receivable in 2016 | Installment		3

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Contingencies (Details) $ in Thousands					12 Months Ended
	Dec. 17, 2015 Lawsuit	Apr. 17, 2015 USD ($)	Jan. 12, 2015 USD ($)	Jul. 02, 2014 USD ($)	Dec. 31, 2016 USD ($) Lawsuit shares
Triple-S Salud, Inc [Member]
Loss Contingencies [Line Items]
Amount of claims for damages				$ 5,000
Overpayment of premium				$ 7,900
Claims by Heirs of Former Shareholders [Member]
Loss Contingencies [Line Items]
Number of defending individual lawsuits | Lawsuit					8
Number of shares claimed to have inherited (in shares) | shares					113
Split conversion ratio					3,000
Joint Underwriting Association Litigations [Member]
Loss Contingencies [Line Items]
Number of defending individual lawsuits | Lawsuit					18
Lawsuit filing date					August 19, 2011
Percentage of premium amount charged as administrative cost					12.00%
Amount of claims for damages					$ 406,600
TSP [Member]
Loss Contingencies [Line Items]
Number of defending individual lawsuits | Lawsuit	3
Period for defendant conducting negotiations					60 days
Community Health Centers - Puerto Rico [Member] | Insurance Claims [Member]
Loss Contingencies [Line Items]
Number of defending individual lawsuits | Lawsuit					6
Claims Relating to the Provision of Health Care Services [Abstract]
Amount of claim for collection of unpaid invoices					$ 9,600
Complaint from Medical Service Provider [Member] | Insurance Claims [Member]
Loss Contingencies [Line Items]
Amount of claims for damages		$ 5,073
Complaint by American Clinical Solutions LLC [Member] | Insurance Claims [Member] | Triple-S Salud, Inc [Member]
Loss Contingencies [Line Items]
Amount of claims for damages			$ 5,000

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Statutory Accounting (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Statutory accounting practice [Abstract]
Percentage lower than combined reported statutory capital and surplus	1.30%	1.10%
Period of gradual compliance provisions whose RBC is below requirement	5 years
Net admitted assets	$ 1,829	$ 1,881	$ 1,734
Capital and surplus	638	691	659
RBC requirement	278	301	209
Net income	24	73	$ 88
Servicing Assets At Amortized Value [Abstract]
Restricted catastrophe loss reserve balance	44,823	43,041
Catastrophe trust fund	47,630	46,221
Amortized cost	5,358	5,136
Fair Value	$ 5,788	5,276
Managed Care [Member]
Statutory accounting practice [Abstract]
Statutory reserve specified as percentage of RBC to avoid intervention	200.00%
Property Liability And Casualty Life Insurance Segment [Member]
Statutory accounting practice [Abstract]
Statutory reserve specified as percentage of RBC to avoid intervention	300.00%
Regulated Subsidiaries [Member]
Statutory accounting practice [Abstract]
Net admitted assets	$ 52,988	$ 51,357

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Supplementary Information on Cash Flow Activities (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Noncash transactions affecting cash flows activities [Abstract]
Change in net unrealized (gain) loss on securities available for sale, including deferred income tax (asset)/liability of $1,085, $(5,717), and $4,717 in 2016, 2015, and 2014, respectively	$ 107	$ 38,989	$ (35,883)
Change in liability for pension benefits, and deferred income tax (asset)/liability of $10,792, $10,124, $(12,298), in 2016, 2015, and 2014, respectively	(16,879)	(15,836)	19,236
Repurchase and retirement of common stock	(56)	(182)	(3,049)
Exercise of stock options	55	179	2,885
Unsettled sales	0	0	10,456
Other [Abstract]
Income taxes paid	11,549	6,437	16,069
Interest paid	7,635	4,792	5,764
Change in net unrealized (gain) loss on securities available for sale, Deferred income tax (asset)/liability	1,085	(5,717)	4,717
Change in liability for pension benefits, Deferred income tax (asset)/liability	$ 10,792	$ 10,124	$ (12,298)

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Segment Information (Details) $ in Thousands		12 Months Ended
		Dec. 31, 2016 USD ($) Region Segment	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)
Segment Information [Abstract]
Number of operating segments | Segment		3
Number of service regions | Region		8
Managed Care segment [Abstract]
Earned premiums revenue		$ 2,890,641	$ 2,783,154	$ 2,128,566
Administrative service fee			24,266	95,908
Number of due days of remittances		60 days
Operating revenues [Abstract]
Premiums earned, net		$ 2,890,641	2,783,154	2,128,566
Fee revenue			24,266	95,908
Net investment income		48,913	45,174	47,540
Total Reportable Segment		2,984,806	2,902,736	2,320,114
Consolidated operating revenues		2,960,858	2,876,752	2,299,640
Operating (loss) income [Abstract]
Consolidated operating (loss) income		(5,227)	39,316	54,851
Consolidated net realized investment gains		17,379	18,941	18,231
Consolidated interest expense		(7,635)	(8,169)	(9,274)
Consolidated other income, net		6,569	7,043	2,243
Consolidated income before taxes		11,086	57,131	66,051
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		14,120	16,379	24,400
Assets [Abstract]
Assets		2,218,999	2,206,145	2,145,736
Cash, cash equivalents, and investments		1,536,820	1,539,364
Property and equipment, net		66,369	73,953
Other assets		51,493	41,776
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		(107)	(38,989)	35,883
Contract [Member]
Managed Care segment [Abstract]
Earned premiums revenue		163,556	155,821	152,659
Operating revenues [Abstract]
Premiums earned, net		163,556	155,821	152,659
Medicare Business [Member]
Managed Care segment [Abstract]
Earned premiums revenue		1,023,904	1,097,657	1,013,746
Operating revenues [Abstract]
Premiums earned, net		1,023,904	1,097,657	1,013,746
Managed Care [Member]
Managed Care segment [Abstract]
Earned premiums revenue		783,231	607,216
Operating revenues [Abstract]
Premiums earned, net		783,231	607,216
Managed Care [Member] | Health Plan [Member]
Managed Care segment [Abstract]
Earned premiums revenue		29,475	30,607	37,748
Operating revenues [Abstract]
Premiums earned, net		29,475	30,607	37,748
Other Segments [Member]
Operating revenues [Abstract]
Operating revenue from external sources	[1]	3,563	3,875	4,234
Total Reportable Segment	[1]	13,470	14,738	13,334
Operating (loss) income [Abstract]
Operating (loss) income	[1]	(1,784)	(301)	(4,440)
TSM operating revenue from external sources	[1]	3,563	3,875	4,234
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense	[1]	645	556	3,264
Assets [Abstract]
Assets	[1]	26,034	25,629	22,682
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale	[1]	105	(10)	0
Unallocated Amount to Segment [Member]
Operating revenues [Abstract]
Operating revenue from external sources		19	53	95
Operating (loss) income [Abstract]
TSM operating revenue from external sources		19	53	95
TSM unallocated operating expenses		(9,739)	(18,858)	(14,571)
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		787	788	813
Assets [Abstract]
Assets		61,059	67,255	102,423
Cash, cash equivalents, and investments		17,033	12,304	44,157
Property and equipment, net		22,380	23,219	20,415
Other assets		21,646	31,732	37,851
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		9	13	(310)
Reportable Segments [Member]
Operating revenues [Abstract]
Total business segments		2,978,071	2,894,263	2,315,063
Operating (loss) income [Abstract]
Operating (loss) income		(5,029)	48,498	59,610
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		13,333	15,591	23,587
Assets [Abstract]
Assets		2,205,985	2,181,589	2,125,569
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		(116)	(39,002)	36,193
Reportable Segments [Member] | Managed Care [Member]
Managed Care segment [Abstract]
Earned premiums revenue		2,647,169	2,548,270	1,894,791
Administrative service fee		17,843	44,705	119,302
Operating revenues [Abstract]
Premiums earned, net		2,647,169	2,548,270	1,894,791
Fee revenue		17,843	44,705	119,302
Net investment income		15,102	11,779	15,010
Total Reportable Segment		2,686,032	2,610,614	2,034,784
Operating (loss) income [Abstract]
Operating (loss) income		(36,777)	20,514	31,445
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		11,114	13,268	17,935
Assets [Abstract]
Assets		1,013,872	1,034,725	975,999
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		104	(15,505)	6,055
Reportable Segments [Member] | Life [Member]
Managed Care segment [Abstract]
Earned premiums revenue		156,140	147,864	142,245
Operating revenues [Abstract]
Premiums earned, net		156,140	147,864	142,245
Net investment income		24,877	24,457	23,717
Total Reportable Segment		181,733	172,572	166,202
Operating (loss) income [Abstract]
Operating (loss) income		21,458	20,012	22,561
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		1,030	1,094	1,394
Assets [Abstract]
Assets		816,920	770,721	764,268
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		2,659	(13,005)	22,349
Reportable Segments [Member] | Property and Casualty [Member]
Managed Care segment [Abstract]
Earned premiums revenue		87,332	87,020	91,530
Operating revenues [Abstract]
Premiums earned, net		87,332	87,020	91,530
Net investment income		8,891	8,706	8,600
Total Reportable Segment		96,836	96,339	100,743
Operating (loss) income [Abstract]
Operating (loss) income		12,074	8,273	10,044
Depreciation and amortization expense [Abstract]
Depreciation and amortization expense		544	673	994
Assets [Abstract]
Assets		349,159	350,514	362,620
Significant noncash items [Abstract]
Consolidated net change in unrealized gain (loss) on securities available for sale		(2,984)	(10,482)	7,789
Intersegment Eliminations [Member]
Operating revenues [Abstract]
Elimination of intersegment premiums		(7,247)	(6,724)	(6,534)
Elimination of intersegment service revenue		(9,907)	(10,863)	(9,100)
Other intersegment eliminations		(78)	23	116
Operating (loss) income [Abstract]
Elimination of TSM charges		9,522	9,623	9,717
Assets [Abstract]
Assets		(48,045)	(42,699)	(82,256)
Intersegment Eliminations [Member] | Managed Care [Member]
Operating revenues [Abstract]
Intersegment premiums/fee revenue		5,918	5,860	5,681
Intersegment Eliminations [Member] | Life [Member]
Operating revenues [Abstract]
Intersegment premiums/fee revenue		716	251	240
Intersegment Eliminations [Member] | Property and Casualty [Member]
Operating revenues [Abstract]
Intersegment premiums/fee revenue		613	613	613
Intersegment Eliminations [Member] | Other Segments [Member]
Operating revenues [Abstract]
Intersegment premiums/fee revenue	[1]	$ 9,907	$ 10,863	$ 9,100

[1] Includes segments that are not required to be reported separately, primarily the data processing services organization and the health clinic.

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Schedule II - Condensed Financial Information of Triple-S Management Corporation, Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Assets [Abstract]
Cash and cash equivalents	$ 103,428	$ 197,818	$ 110,037	$ 74,356
Securities available for sale, at fair value [Abstract]
Equity securities	270,349	197,071
Deferred tax assets	57,768	52,361
Other assets	51,493	41,776
Total assets	2,218,999	2,206,145	2,145,736
Liabilities [Abstract]
Long-term borrowings	35,085	36,827
Liability for pension benefits	30,892	62,945
Total liabilities	1,356,513	1,359,289
Stockholders' equity [Abstract]
Additional paid-in-capital	65,592	83,438
Retained earnings	730,904	713,466
Accumulated other comprehensive income, net	42,395	25,623
Total Triple-S Management Corporation stockholders' equity	863,163	847,526
Total liabilities and stockholders' equity	2,218,999	2,206,145
Securities available for sale, equity securities, amortized cost	240,699	169,593
Class A Common Stock [Member]
Stockholders' equity [Abstract]
Common stock	951	951
Class B Common Stock [Member]
Stockholders' equity [Abstract]
Common stock	23,321	24,048
Parent Company [Member]
Assets [Abstract]
Cash and cash equivalents	14,153	12,304	$ 16,631	$ 235
Securities available for sale, at fair value [Abstract]
Equity securities	2,880	0
Investment in subsidiaries	866,010	866,712
Notes receivable and accrued interest from subsidiaries	47,153	48,858
Due from subsidiaries	5,255	3,730
Deferred tax assets	14,976	26,767
Other assets	29,050	28,138
Total assets	979,477	986,509
Liabilities [Abstract]
Notes payable and accrued interest to subsidiary	16,475	15,720
Due to subsidiaries	22,661	11,860
Long-term borrowings	35,085	36,827
Liability for pension benefits	30,892	62,945
Other liabilities	11,201	11,631
Total liabilities	116,314	138,983
Stockholders' equity [Abstract]
Additional paid-in-capital	65,592	83,438
Retained earnings	730,904	713,466
Accumulated other comprehensive income, net	42,395	25,623
Total Triple-S Management Corporation stockholders' equity	863,163	847,526
Total liabilities and stockholders' equity	979,477	986,509
Securities available for sale, equity securities, amortized cost	2,869
Parent Company [Member] | Class A Common Stock [Member]
Stockholders' equity [Abstract]
Common stock	951	951
Parent Company [Member] | Class B Common Stock [Member]
Stockholders' equity [Abstract]
Common stock	$ 23,321	$ 24,048

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Schedule II - Condensed Financial Information of Triple-S Management Corporation, Statements of Earnings (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Statements of Earnings [Abstract]
Investment income	$ 48,913	$ 45,174	$ 47,540
Other revenues	3,461	3,719	4,232
Total revenues	2,984,806	2,902,736	2,320,114
Operating expenses [Abstract]
Interest expense	7,635	8,169	9,274
Total operating expenses	493,894	518,721	497,194
Income (loss) before taxes	11,086	57,131	66,051
Income tax expense (benefit)	(6,345)	5,099	745
Net income attributable to Triple-S Management Corporation	17,438	52,121	65,660
Parent Company [Member]
Statements of Earnings [Abstract]
Investment income	19	53	95
Other revenues	11,644	12,015	11,034
Total revenues	11,663	12,068	11,129
Operating expenses [Abstract]
General and administrative expenses	9,739	18,858	14,571
Interest expense	1,763	2,435	2,998
Total operating expenses	11,502	21,293	17,569
Income (loss) before taxes	161	(9,225)	(6,440)
Income tax expense (benefit)	1,183	(1,071)	(162)
Loss of parent company	(1,022)	(8,154)	(6,278)
Equity in net income of subsidiaries	18,460	60,275	71,938
Net income attributable to Triple-S Management Corporation	$ 17,438	$ 52,121	$ 65,660

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Schedule II - Condensed Financial Information of Triple-S Management Corporation, Statements of Cash Flows (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Statements of Cash Flows [Abstract]
Net income	$ 17,438	$ 52,121	$ 65,660
Adjustments to reconcile net income to net cash provided by operating activities [Abstract]
Depreciation and amortization	14,120	16,379	24,400
Share-based compensation	2,463	8,290	2,371
Deferred income tax expense (benefit)	(8,326)	(5,070)	(21,806)
Changes in assets and liabilities [Abstract]
Other assets	(9,009)	(2,630)	8,630
Net cash provided by operating activities	6,471	229,094	37,991
Cash flows from investing activities [Abstract]
Net cash (used in) provided by investing activities	(86,299)	(51,376)	29,241
Cash flows from financing activities [Abstract]
Repayments of long-term borrowings	(1,742)	(37,640)	(14,835)
Repurchase of common stock	(21,371)	(48,287)	(11,337)
Net cash used in financing activities	(14,562)	(89,937)	(31,551)
Net (decrease) increase in cash and cash equivalents	(94,390)	87,781	35,681
Beginning of year	197,818	110,037	74,356
End of year	103,428	197,818	110,037
Parent Company [Member]
Statements of Cash Flows [Abstract]
Net income	17,438	52,121	65,660
Adjustments to reconcile net income to net cash provided by operating activities [Abstract]
Equity in net income of subsidiaries	(18,460)	(60,275)	(71,938)
Depreciation and amortization	839	872	863
Share-based compensation	2,799	8,290	2,371
Deferred income tax expense (benefit)	1,042	(1,227)	(137)
Dividends received from subsidiaries	19,000	47,000	36,600
Other	0	42	34
Changes in assets and liabilities [Abstract]
Accrued interest from subsidiaries, net	(646)	(1,046)	(1,614)
Due from subsidiaries	(1,525)	4,869	(2,831)
Other assets	(1,751)	(1,953)	1,004
Due to subsidiaries	10,801	(2,162)	5,654
Other liabilities	(4,812)	4,614	(1,948)
Net cash provided by operating activities	24,725	51,145	33,718
Cash flows from investing activities [Abstract]
Acquisition of investment in securities classified as available for sale	(2,869)	0	(27,572)
Proceeds from sale and maturities of investment in securities classified as available for sale	0	27,500	28,016
Collection of note receivable from subsidiary	4,500	9,000	9,250
Issuance of note receivable to subsidiary	(1,394)	(2,369)	(13,131)
Capital contribution to subsidiary	0	0	(908)
Net acquisition of property and equipment	0	(3,676)	0
Net cash (used in) provided by investing activities	237	30,455	(4,345)
Cash flows from financing activities [Abstract]
Repayments of long-term borrowings	(1,742)	(37,640)	(1,640)
Repurchase of common stock	(21,371)	(48,287)	(11,337)
Net cash used in financing activities	(23,113)	(85,927)	(12,977)
Net (decrease) increase in cash and cash equivalents	1,849	(4,327)	16,396
Beginning of year	12,304	16,631	235
End of year	$ 14,153	$ 12,304	$ 16,631

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Schedule II - Condensed Financial Information of Triple-S Management Corporation, Long-Term Borrowings (Details) $ in Thousands		12 Months Ended
	Dec. 28, 2016 USD ($) Loan	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Summary of Long-term Borrowings [Abstract]
Total borrowings		$ 35,187	$ 36,827
Less unamortized debt issuance costs		102	0
Long-term borrowings		35,085	36,827
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
Total borrowings		35,187	36,827
Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due December 2020 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		24,000	24,000
Debt instrument, principal amount		$ 60,000
Debt instrument, maturity date		Dec. 31, 2020
Debt instrument, fixed interest rate		6.60%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		$ 24,000	24,000
Debt instrument, period of prepayment at par		5 years
Secured Debt [Member] | Secured Loans Payable, Due July 2024 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		$ 0	12,827
Debt instrument, principal amount			$ 41,000
Debt instrument, maturity date			Jul. 01, 2024
Debt instrument, monthly installment payment			$ 137
Basis spread on variable rate			1.00%
Debt instrument, variable interest rate			1.23%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		0	$ 12,827
Secured Debt [Member] | Secured Loans Payable, Due October 2023 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		11,187	0
Debt instrument, principal amount		$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Debt instrument, monthly installment payment		$ 137
Basis spread on variable rate		1.00%
Debt instrument, variable interest rate		1.77%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		$ 11,187	0
Parent Company [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		35,187	36,827
Less unamortized debt issuance costs		102	0
Long-term borrowings		35,085	36,827
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
2017		1,640
2018		1,640
2019		1,640
2020		25,640
2021		1,640
Thereafter		2,987
Total borrowings		35,187	36,827
Parent Company [Member] | Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due December 2020 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		24,000	24,000
Debt instrument, principal amount		$ 60,000
Debt instrument, maturity date		Dec. 31, 2020
Debt instrument, fixed interest rate		6.60%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		$ 24,000	24,000
Debt instrument, period of prepayment at par		5 years
Parent Company [Member] | Secured Debt [Member] | Secured Loans Payable, Due July 2024 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		$ 0	12,827
Debt instrument, principal amount			$ 41,000
Debt instrument, maturity date			Jul. 01, 2024
Debt instrument, monthly installment payment			$ 137
Basis spread on variable rate			1.00%
Debt instrument, variable interest rate			1.23%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		0	$ 12,827
Parent Company [Member] | Secured Debt [Member] | Secured Loans Payable, Due October 2023 [Member]
Summary of Long-term Borrowings [Abstract]
Total borrowings		11,187	0
Debt instrument, principal amount		$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Debt instrument, monthly installment payment		$ 137
Basis spread on variable rate		1.00%
Debt instrument, variable interest rate		1.77%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Total borrowings		$ 11,187	$ 0
Commercial Bank in Puerto Rico [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Maximum borrowing capacity	$ 35,500
Number of term loans issued | Loan	3
Proceeds from debt issuance used to fund portion of debt service reserve	$ 200
Commercial Bank in Puerto Rico [Member] | First Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		3.00%
Commercial Bank in Puerto Rico [Member] | Second Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		2.00%
Commercial Bank in Puerto Rico [Member] | Third Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		1.00%
Commercial Bank in Puerto Rico [Member] | Term Loan A [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Commercial Bank in Puerto Rico [Member] | Term Loan A [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	1.00%
Commercial Bank in Puerto Rico [Member] | Term Loan B [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 20,150
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Term Loan B [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	2.75%
Commercial Bank in Puerto Rico [Member] | Term Loan C [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 4,116
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Term Loan C [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	3.25%
Commercial Bank in Puerto Rico [Member] | Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due January 2021 [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, maturity date		Jan. 31, 2021
Debt instrument, fixed interest rate	6.60%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Repaid principal amount of notes	$ 24,000
Commercial Bank in Puerto Rico [Member] | Parent Company [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Maximum borrowing capacity	$ 35,500
Number of term loans issued | Loan	3
Proceeds from debt issuance used to fund portion of debt service reserve	$ 200
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | First Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		3.00%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Second Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		2.00%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Third Year [Member]
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Prepayment penalty fee percentage		1.00%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan A [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 11,187
Debt instrument, maturity date		Oct. 01, 2023
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan A [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	1.00%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan B [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 20,150
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan B [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	2.75%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan C [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, principal amount	$ 4,116
Debt instrument, maturity date		Jan. 31, 2024
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Term Loan C [Member] | LIBOR [Member]
Summary of Long-term Borrowings [Abstract]
Basis spread on variable rate	3.25%
Commercial Bank in Puerto Rico [Member] | Parent Company [Member] | Senior Notes [Member] | 6.60% Senior Unsecured Notes Payable, Due January 2021 [Member]
Summary of Long-term Borrowings [Abstract]
Debt instrument, maturity date		Jan. 31, 2021
Debt instrument, fixed interest rate	6.60%
Aggregate Maturities of Company's Long Term Borrowings [Abstract]
Repaid principal amount of notes	$ 24,000

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Schedule II - Condensed Financial Information of Triple-S Management Corporation, Transactions with Related Parties (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2016 USD ($) Note	Dec. 31, 2015 USD ($)	Dec. 31, 2014 USD ($)
Summary of Significant Related Party Transactions [Abstract]
Accrued interest	$ 13,668	$ 12,624
Parent Company [Member]
Summary of Significant Related Party Transactions [Abstract]
Rent charges to subsidiaries	7,801	7,801	$ 7,801
Interest charged to subsidiary on note receivable	2,258	2,758	2,527
Interest charged from subsidiary on note payable	755	720	$ 755
Note payable to subsidiary	15,000	15,000
Accrued interest	$ 1,475	720
Interest rate	4.70%
Parent Company [Member] | Notes Receivable from Subsidiaries Pursuant to Provisions of Article 29.30 of Puerto Rico Insurance Code [Member]
Summary of Significant Related Party Transactions [Abstract]
Number of notes receivable from subsidiaries | Note	3
Note receivable from subsidiary	$ 30,750	35,250
Period for obtaining written authorization from the commissioner of insurance prior to proposed payment date	60 days
Accrued interest	$ 5,660	4,100
Interest rate	4.70%
Parent Company [Member] | Various Notes Receivable from Subsidiary [Member]
Summary of Significant Related Party Transactions [Abstract]
Note receivable from subsidiary	$ 10,645	9,460
Accrued interest	$ 98	$ 48
Interest rate	5.10%
Parent Company [Member] | Various Notes Receivable from Subsidiary [Member] | Minimum [Member]
Summary of Significant Related Party Transactions [Abstract]
Debt instrument, maturity date	Dec. 31, 2019
Parent Company [Member] | Various Notes Receivable from Subsidiary [Member] | Maximum [Member]
Summary of Significant Related Party Transactions [Abstract]
Debt instrument, maturity date	Dec. 31, 2020

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Schedule III - Supplementary Insurance Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Supplementary Insurance Information, by Segment [Line Items]
Deferred policy acquisition costs and value of business acquired	$ 194,787	$ 190,648	$ 184,100
Claim liabilities	487,943	491,765	390,086
Liability for future policy benefits	321,232	352,370	328,293
Unearned premiums	79,310	80,260	82,656
Other policy claims and benefits payable	0	0	0
Premium revenue	2,890,641	2,783,154	2,128,566
Net investment income	48,913	45,174	47,540
Claims incurred	2,472,191	2,318,715	1,747,595
Amortization of deferred policy acquisition costs and value of business acquired	37,700	43,594	43,638
Other operating expenses	456,194	475,127	453,556
Net premiums written	2,885,504	2,777,053	2,127,719
Managed Care [Member]
Supplementary Insurance Information, by Segment [Line Items]
Deferred policy acquisition costs and value of business acquired	0	0	0
Claim liabilities	349,047	348,297	249,330
Liability for future policy benefits	0	0	0
Unearned premiums	2,889	3,489	4,340
Other policy claims and benefits payable	0	0	0
Premium revenue	2,648,469	2,549,522	1,896,142
Net investment income	15,102	11,779	15,010
Claims incurred	2,347,547	2,196,693	1,629,095
Amortization of deferred policy acquisition costs and value of business acquired	0	0	0
Other operating expenses	375,262	393,407	374,244
Net premiums written	2,648,469	2,549,173	1,896,142
Life Insurance [Member]
Supplementary Insurance Information, by Segment [Line Items]
Deferred policy acquisition costs and value of business acquired	177,811	172,284	164,367
Claim liabilities	42,858	44,601	43,670
Liability for future policy benefits	321,232	352,370	328,293
Unearned premiums	8,122	6,596	5,158
Other policy claims and benefits payable	0	0	0
Premium revenue	156,856	148,115	142,485
Net investment income	24,877	24,457	23,717
Claims incurred	86,924	82,561	74,850
Amortization of deferred policy acquisition costs and value of business acquired	12,530	17,661	18,260
Other operating expenses	60,821	52,338	50,531
Net premiums written	152,506	144,262	142,485
Property and Casualty Insurance [Member]
Supplementary Insurance Information, by Segment [Line Items]
Deferred policy acquisition costs and value of business acquired	16,976	18,364	19,733
Claim liabilities	96,977	99,796	97,451
Liability for future policy benefits	0	0	0
Unearned premiums	68,299	70,175	73,158
Other policy claims and benefits payable	0	0	0
Premium revenue	87,945	87,633	92,143
Net investment income	8,891	8,706	8,600
Claims incurred	40,766	42,600	46,330
Amortization of deferred policy acquisition costs and value of business acquired	25,170	25,933	25,378
Other operating expenses	18,826	19,533	18,991
Net premiums written	87,158	85,734	89,092
Other Non-reportable Segments, Parent Company Operations and Net Consolidating Entries [Member]
Supplementary Insurance Information, by Segment [Line Items]
Deferred policy acquisition costs and value of business acquired	0	0	0
Claim liabilities	(939)	(929)	(365)
Liability for future policy benefits	0	0	0
Unearned premiums	0	0	0
Other policy claims and benefits payable	0	0	0
Premium revenue	(2,629)	(2,116)	(2,204)
Net investment income	43	232	213
Claims incurred	(3,046)	(3,139)	(2,680)
Amortization of deferred policy acquisition costs and value of business acquired	0	0	0
Other operating expenses	1,285	9,849	9,790
Net premiums written	$ (2,629)	$ (2,116)	$ 0

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Schedule IV - Reinsurance (Details) - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Reinsurance [Abstract]
Life insurance in force, gross amount	[1]	$ 10,178,956	$ 10,129,123	$ 9,739,048
Life insurance in force, net amount		$ 10,178,956	$ 10,129,123	$ 9,739,048
Life insurance in force, percentage of amount assumed to net		0.00%	0.00%	0.00%
Premiums, gross amount	[1]	$ 2,945,017	$ 2,843,086	$ 2,199,351
Premiums, ceded to other companies		59,032	64,134	70,785
Premiums, assumed from other companies		4,656	4,202	0
Premiums, net amount		$ 2,890,641	$ 2,783,154	$ 2,128,566
Premiums, percentage of amount assumed to net		0.20%	0.20%	0.00%
Reinsurance premiums for insurance companies intercompany elimination gross amount		$ 3,457	$ 4,402	$ 4,354
Life Insurance [Member]
Reinsurance [Abstract]
Premiums, gross amount	[1]	160,628	153,607	152,573
Premiums, ceded to other companies		8,838	9,596	10,328
Premiums, assumed from other companies		4,350	3,853	0
Premiums, net amount		$ 156,140	$ 147,864	$ 142,245
Premiums, percentage of amount assumed to net		2.80%	2.60%	0.00%
Accident and Health Insurance [Member]
Reinsurance [Abstract]
Premiums, gross amount	[1]	$ 2,650,011	$ 2,552,699	$ 1,900,556
Premiums, ceded to other companies		3,148	4,778	5,765
Premiums, assumed from other companies		306	349	0
Premiums, net amount		$ 2,647,169	$ 2,548,270	$ 1,894,791
Premiums, percentage of amount assumed to net		0.00%	0.00%	0.00%
Property and Casualty Insurance [Member]
Reinsurance [Abstract]
Premiums, gross amount	[1]	$ 134,378	$ 136,780	$ 146,222
Premiums, ceded to other companies		47,046	49,760	54,692
Premiums, assumed from other companies		0	0	0
Premiums, net amount		$ 87,332	$ 87,020	$ 91,530
Premiums, percentage of amount assumed to net		0.00%	0.00%	0.00%

[1] Gross premiums amount is presented net of intercompany eliminations of $3,457, $4,402 and $4,354 for the years ended December 31, 2016, 2015, and 2014, respectively.

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Schedule V - Valuation and Qualifying Accounts (Details) - Allowance for Doubtful Receivables [Member] - USD ($) $ in Thousands		12 Months Ended
		Dec. 31, 2016	Dec. 31, 2015	Dec. 31, 2014
Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at beginning of period		$ 37,244	$ 36,368	$ 21,549
Additions, charged to costs and expenses		1,295	15,781	12,847
Additions, charged (reversal) to other accounts	[1]	306	340	4,227
Deductions	[2]	(1,538)	(15,245)	(2,255)
Balance at end of period		$ 37,307	$ 37,244	$ 36,368

[1] Represents premiums adjustment to provide for unresolved reconciliation items with the Government of Puerto Rico and other entities.

[2] Deductions represent the write-off of accounts deemed uncollectible.