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Investments (Tables)
9 Months Ended
Sep. 30, 2020
Investments  
Gross unrealized gains and losses on investments in securities

As of September 30, 2020

    

Cost or

    

Allowance for

    

Gross Unrealized

    

Estimated

Amortized

Expected Credit

Fair

Cost

Losses

Gains

Losses  (3)

Value

U.S. Treasury securities

$

1,822

$

$

52

$

$

1,874

Obligations of states and political subdivisions

 

223,760

 

 

8,111

 

(363)

 

231,508

Residential mortgage-backed securities (1)

 

247,854

 

 

13,199

 

(8)

 

261,045

Commercial mortgage-backed securities

 

105,695

 

 

9,955

 

 

115,650

Other asset-backed securities

 

33,077

 

 

499

 

(432)

 

33,144

Corporate and other securities

 

554,572

 

(2,289)

 

33,266

 

(3,613)

 

581,936

Subtotal, fixed maturity securities 

 

1,166,780

 

(2,289)

 

65,082

 

(4,416)

 

1,225,157

Equity securities (2)

 

171,363

 

 

24,744

 

(3,867)

 

192,240

Other invested assets (4)

 

42,603

 

 

 

 

42,603

Totals

$

1,380,746

$

(2,289)

$

89,826

$

(8,283)

$

1,460,000

As of December 31, 2019

 

 

    

Cost or

    

Gross Unrealized

    

Estimated

 

Amortized

Fair

 

Cost

Gains

Losses  (3)

Value

 

U.S. Treasury securities

$

1,504

$

8

$

$

1,512

Obligations of states and political subdivisions

 

241,597

 

9,799

 

 

251,396

Residential mortgage-backed securities (1)

 

301,503

 

6,608

 

(909)

 

307,202

Commercial mortgage-backed securities

 

106,902

 

3,233

 

(397)

 

109,738

Other asset-backed securities

 

36,068

 

218

 

(64)

 

36,222

Corporate and other securities

 

504,783

 

18,455

 

(1,268)

 

521,970

Subtotal, fixed maturity securities 

 

1,192,357

 

38,321

 

(2,638)

 

1,228,040

Equity securities (2)

 

151,121

 

27,879

 

(1,363)

 

177,637

Other invested assets (4)

 

37,278

 

 

 

37,278

Totals

$

1,380,756

$

66,200

$

(4,001)

$

1,442,955

(1)Residential mortgage-backed securities consists primarily of obligations of U.S. Government agencies including collateralized mortgage obligations issued, guaranteed and/or insured by the following issuers: Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA) and the Federal Home Loan Bank (FHLB).
(2)Equity securities include common stock, preferred stock, mutual funds and interests in mutual funds held to fund the Company’s executive deferred compensation plan.
(3)The Company’s investment portfolio included 404 and 229 securities in an unrealized loss position at September 30, 2020 and December 31, 2019, respectively.
(4)Other invested assets are accounted for under the equity method which approximated fair value.
Amortized cost and the estimated fair value of fixed maturity securities, by maturity

As of September 30, 2020

    

Amortized

    

Estimated

Cost

Fair Value

Due in one year or less

$

94,472

$

95,498

Due after one year through five years

 

288,475

 

298,896

Due after five years through ten years

 

309,350

 

328,829

Due after ten years through twenty years

 

86,213

 

90,188

Due after twenty years

 

1,643

 

1,905

Asset-backed securities

 

386,627

 

409,841

Totals

$

1,166,780

$

1,225,157

Gross realized gains and losses on sales of investments

Three Months Ended September 30, 

    

Nine Months Ended September 30, 

    

2020

    

2019

 

2020

    

2019

Gross realized gains

Fixed maturity securities

$

461

$

365

$

1,489

$

959

Equity securities

 

1,405

 

1,221

 

4,276

 

2,862

Gross realized losses

Fixed maturity securities

 

(753)

 

(375)

 

(2,150)

 

(1,283)

Equity securities

 

(444)

 

(17)

 

(4,298)

 

(1,025)

Net realized (losses) gains on investments

$

669

$

1,194

$

(683)

$

1,513

Gross unrealized losses included in the Company's investment portfolio and the fair value of those securities

As of September 30, 2020

Less than 12 Months

12 Months or More

Total

    

Estimated

    

Unrealized

    

Estimated

    

Unrealized

    

Estimated

    

Unrealized

Fair Value

Losses

Fair Value

Losses

Fair Value

Losses

U.S. Treasury securities

$

$

$

$

$

$

Obligations of states and political subdivisions

 

13,635

 

363

 

 

 

13,635

 

363

Residential mortgage-backed securities

 

5,220

 

8

 

38

 

 

5,258

 

8

Commercial mortgage-backed securities

 

 

 

 

 

 

Other asset-backed securities

 

2,464

273

8,924

159

11,388

432

Corporate and other securities

 

111,614

 

3,103

 

8,736

 

510

 

120,350

 

3,613

Subtotal, fixed maturity securities

 

132,933

 

3,747

 

17,698

 

669

 

150,631

 

4,416

Equity securities

 

20,297

 

2,995

 

2,577

 

872

 

22,874

 

3,867

Total temporarily impaired securities

$

153,230

$

6,742

$

20,275

$

1,541

$

173,505

$

8,283

As of December 31, 2019

Less than 12 Months

12 Months or More

Total

    

Estimated

    

Unrealized

    

Estimated

    

Unrealized

    

Estimated

    

Unrealized

Fair Value

Losses

Fair Value

Losses

Fair Value

Losses

U.S. Treasury securities

$

$

$

$

$

$

Obligations of states and political subdivisions

 

 

 

 

 

 

Residential mortgage-backed securities

 

61,933

 

409

 

31,655

 

500

 

93,588

 

909

Commercial mortgage-backed securities

 

36,398

 

397

 

866

 

 

37,264

 

397

Other asset-backed securities

 

21,281

64

462

 

21,743

 

64

Corporate and other securities

 

26,386

 

481

 

13,718

 

787

 

40,104

 

1,268

Subtotal, fixed maturity securities

 

145,998

 

1,351

 

46,701

 

1,287

 

192,699

 

2,638

Equity securities

 

8,849

 

391

 

14,143

 

972

 

22,992

 

1,363

Total temporarily impaired securities

$

154,847

$

1,742

$

60,844

$

2,259

$

215,691

$

4,001

Reconciliation of beginning and ending balances of allowance for expected credit losses on fixed maturities classified as available for sale

Three Months Ended September 30, 2020

    

Corporate and other

securities

Balance July 1, 2020

$

2,471

Credit losses on securities with no previously recorded credit losses

 

113

Net increases (decreases) in allowance on previously impaired securities

 

(110)

Reduction due to sales

 

(185)

Writeoffs charged against allowance

 

Recoveries of amounts previously written off

 

Balance September 30, 2020

$

2,289

Nine Months Ended September 30, 2020

    

Corporate and other

securities

Balance January 1, 2020

$

Credit losses on securities with no previously recorded credit losses

 

2,289

Net increases (decreases) in allowance on previously impaired securities

 

Reduction due to sales

 

Writeoffs charged against allowance

 

Recoveries of amounts previously written off

 

Balance September 30, 2020

$

2,289

Components of net investment income

Three Months Ended September 30, 

 

Nine Months Ended September 30, 

    

2020

    

2019

    

2020

    

2019

Interest on fixed maturity securities

$

9,331

$

11,285

$

28,757

$

32,129

Dividends on equity securities

 

1,097

 

1,116

 

3,337

 

3,315

Equity in earnings of other invested assets

 

24

 

310

 

549

 

1,070

Interest on other assets

 

6

 

7

 

20

 

24

Total investment income 

 

10,458

 

12,718

 

32,663

 

36,538

Investment expenses

 

740

 

771

 

2,319

 

2,266

Net investment income 

$

9,718

$

11,947

$

30,344

$

34,272

Fair Value Measurements

As of September 30, 2020

    

Total

    

Level 1 Inputs

    

Level 2 Inputs

    

Level 3 Inputs

U.S. Treasury securities

$

1,874

$

$

1,874

$

Obligations of states and political subdivisions

 

231,508

 

 

231,508

 

Residential mortgage-backed securities

 

261,045

 

 

261,045

 

Commercial mortgage-backed securities

 

115,650

 

 

115,650

 

Other asset-backed securities

 

33,144

 

 

33,144

 

Corporate and other securities

 

581,936

 

 

581,936

 

Equity securities

 

160,071

 

158,373

 

 

1,698

Total investment securities

$

1,385,228

$

158,373

$

1,225,157

$

1,698

As of December 31, 2019

    

Total

    

Level 1 Inputs

    

Level 2 Inputs

    

Level 3 Inputs

U.S. Treasury securities

$

1,512

$

$

1,512

$

Obligations of states and political subdivisions

 

251,396

 

 

251,396

 

Residential mortgage-backed securities

 

307,202

 

 

307,202

 

Commercial mortgage-backed securities

 

109,738

 

 

109,738

 

Other asset-backed securities

 

36,222

 

 

36,222

 

Corporate and other securities

 

521,970

 

 

521,970

 

Equity securities

 

144,877

 

144,361

 

 

516

Total investment securities

$

1,372,917

$

144,361

$

1,228,040

$

516

Changes in Company's Level 3 Fair value securities

Three Months Ended September 30, 

 

Nine Months Ended September 30, 

    

2020

    

2019

    

2020

    

2019

Level 3

Level 3

 

Level 3

Level 3

Fair Value

Fair Value

 

Fair Value

Fair Value

Securities

Securities

 

Securities

Securities

Balance at beginning of period

$

1,698

$

486

$

516

$

680

Net gains and losses included in earnings

 

 

 

 

Net gains included in other comprehensive income

 

 

 

 

Purchases

 

 

 

1,182

 

103

Sales

(297)

Transfers into Level 3

 

 

 

Transfers out of Level 3

 

 

 

 

Balance at end of period

$

1,698

$

486

$

1,698

$

486

Amount of total losses included in earnings attributable to the change in unrealized losses related to assets still held at end of period

$

$

$

$