Income Taxes (Tables)

6 Months Ended

Jun. 30, 2020

Schedule of components of income tax expense

Income tax expense consists of the following components:



	Three Months Ended June 30,					Six Months Ended June 30,
(In thousands)	2020			2019		2020		2019
Current	$	7,969		$	12,801	$	18,097	$	19,354
Deferred	(4,534		)	13,527		12,513		28,973
Total income tax expense	$	3,435		$	26,328	$	30,610	$	48,327

Schedule of reconciliation of difference between income tax expense and expected tax provision at weighted average tax rate

The reconciliation of the difference between income tax expense and the expected tax provision at the weighted average tax rate was as follows:



	Three Months Ended June 30,
	2020					2019
($ in thousands)	$			% of pretax income		$			% of pretax income
Tax provision at weighted average statutory rates	$	2,750		14.6	%	$	25,795		15.9	%
Non-deductible expenses	707			3.8		439			0.3
Tax exempt interest, net of proration	(358		)	(1.9	)	(418		)	(0.3	)
Excess tax benefits from stock-based compensation	21			0.1		(22		)	0.0
Other	315			1.7		534			0.3
Total income tax expense	$	3,435		18.3	%	$	26,328		16.2	%

	Six Months Ended June 30,
	2020					2019
($ in thousands)	$			% of pretax income		$			% of pretax income
Tax provision at weighted average statutory rates	$	30,126		15.4	%	$	49,733		15.9	%
Non-deductible expenses	1,421			0.7		763			0.3
Tax exempt interest, net of proration	(700		)	(0.4	)	(861		)	(0.3	)
Excess tax benefits from stock-based compensation	(599		)	(0.3	)	(1,978		)	(0.6	)
Other	362			0.3		670			0.2
Total income tax expense	$	30,610		15.7	%	$	48,327		15.5	%

Schedule of net deferred tax (liability) asset and components

We provide deferred taxes to reflect the estimated future tax effects of the differences between the financial statement and tax bases of assets and liabilities using currently enacted tax laws. The net deferred tax liability was comprised of the following:



	June 30,			December 31,
(In thousands)	2020			2019
Deferred tax assets	$	28,124		$	29,392
Deferred tax liabilities	(300,870		)	(279,012		)
Net deferred tax liability	$	(272,746	)	$	(249,620	)

The components of the net deferred tax liability were as follows:



	June 30,			December 31,
(In thousands)	2020			2019
Contingency reserves	$	(273,077	)	$	(261,855	)
Unrealized (gain) loss on investments	(23,828		)	(13,214		)
Unearned premium reserve	15,233			16,641
Accrued expenses	4,279			3,391
Deferred policy acquisition costs	(3,330		)	(3,298		)
Unearned ceding commissions	3,021			3,227
Loss reserves	1,493			416
Start-up expenditures, net	1,274			1,410
Fixed assets	1,260			1,502
Nonvested shares	830			2,426
Change in fair market value of derivatives	726			370
Investments in limited partnerships	(400		)	(400		)
Prepaid expenses	(131		)	(132		)
Loss reserves - TCJA transition adjustment	(104		)	(113		)
Organizational expenditures	8			9
Net deferred tax liability	$	(272,746	)	$	(249,620	)