10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended June 30, 2014
	OR
o	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 001-35009

Fortegra Financial Corporation

(Exact name of Registrant as specified in its charter)

Delaware	58-1461399
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
10151 Deerwood Park Boulevard, Building 100, Suite 330, Jacksonville, FL	32256
(Address of principal executive offices)	(Zip Code)
Registrant's telephone number, including area code:	(866) 961-9529

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 x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o

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 the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o	Accelerated filer o
Non-accelerated filer o (Do not check if a smaller reporting company)	Smaller reporting company x

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).Yes o No x

The number of outstanding shares of the registrant's Common Stock, $0.01 par value, outstanding as of July 31, 2014 was 20,061,849.

FORTEGRA FINANCIAL CORPORATION

QUARTERLY REPORT ON FORM 10-Q

JUNE 30, 2014

TABLE OF CONTENTS

PART I - FINANCIAL INFORMATION		Page Number
Item 1.	Financial Statements	3
	Consolidated Balance Sheets (Unaudited)	3
	Consolidated Statements of Income (Unaudited)	4
	Consolidated Statements of Comprehensive Income (Unaudited)	5
	Consolidated Statement of Stockholders' Equity (Unaudited)	6
	Consolidated Statements of Cash Flows (Unaudited)	7
	Notes to Consolidated Financial Statements (Unaudited)	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	27
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	39
Item 4.	Controls and Procedures	39
PART II - OTHER INFORMATION
Item 1.	Legal Proceedings	40
Item 1A.	Risk Factors	40
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	53
Item 3.	Defaults Upon Senior Securities	53
Item 4.	Mine Safety Disclosures	53
Item 5.	Other Information	53
Item 6.	Exhibits	54
Signatures		54
Exhibit Index		55

1

FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (this "Form 10-Q") contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which are made in reliance upon the protection provided by such acts for forward-looking statements. Such statements are subject to risks and uncertainties. All statements other than statements of historical fact included in this Form 10-Q are forward-looking statements. Forward-looking statements give our current expectations and projections relating to our financial condition, results of operations, plans, objectives, future performance and business. You can identify forward-looking statements by the fact that they do not relate strictly to historical or current facts. These statements may include words such as "anticipate," "estimate," "expect," "project,'' "plan," "intend," "believe," "may," "should," "can have," "will," "likely" and other words and terms of similar meaning in connection with any discussion of the timing or nature of future operating results or financial performance or other events.

The forward-looking statements contained in this Form 10-Q are based on assumptions that we have made in light of our industry experience and our perceptions of historical trends, current conditions, expected future developments and other factors we believe are appropriate under the circumstances. As you read this Form 10-Q, you should understand that these statements are not guarantees of performance or results. They involve risks, uncertainties (some of which are beyond our control) and assumptions. Although we believe that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect our actual financial results and cause them to differ materially from those anticipated in the forward-looking statements. We believe these factors include, but are not limited to, those described under PART I, ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS and PART II, ITEM 1A. RISK FACTORS. Should one or more of these risks or uncertainties materialize, or should any of these assumptions prove incorrect, our actual results may vary materially from those projected in these forward-looking statements.

Any forward-looking statement made by us in this Form 10-Q speaks only as of the date of the filing of this Form 10-Q. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to update any forward-looking statement, whether the result of new information, future developments or otherwise, except as may be required by law.

This Form 10-Q should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2013 ("2013 Form 10-K") along with the Company's other filings with the Securities and Exchange Commission ("SEC").

PART I. FINANCIAL INFORMATION

Unless the context requires otherwise, references in this Form 10-Q to "Fortegra Financial," "Fortegra," "we," "us," "the Company" or similar terms refer to Fortegra Financial Corporation and its subsidiaries.

2

ITEM 1. FINANCIAL STATEMENTS

FORTEGRA FINANCIAL CORPORATION

CONSOLIDATED BALANCE SHEETS (Unaudited)

(All Amounts in Thousands, Except Share and Per Share Amounts)

	At
	June 30, 2014			December 31, 2013
Assets:
Investments:
Fixed maturity securities available-for-sale, at fair value (amortized cost of $144,118 at June 30, 2014 and $133,288 at December 31, 2013)	$	144,816		$	131,751
Equity securities available-for-sale, at fair value (cost of $7,081 at June 30, 2014 and December 31, 2013, respectively)	6,901			6,198
Short-term investments	871			871
Total investments	152,588			138,820
Cash and cash equivalents	10,657			21,681
Restricted cash	12,279			17,293
Accrued investment income	1,339			1,175
Notes receivable, net	18,297			11,920
Accounts and premiums receivable, net	15,743			18,702
Other receivables	29,941			33,409
Reinsurance receivables	219,074			215,084
Deferred acquisition costs	67,841			78,042
Property and equipment, net	13,133			14,332
Goodwill	73,701			73,701
Other intangible assets, net	46,538			49,173
Other assets	7,820			6,307
Assets of discontinued operations	491			791
Total assets	$	669,442		$	680,430
Liabilities:
Unpaid claims	$	38,549		$	34,732
Unearned premiums	258,778			256,380
Policyholder account balances	22,081			23,486
Accrued expenses, accounts payable and other liabilities	46,290			53,035
Income taxes payable	2,722			2,842
Deferred revenue	59,508			76,927
Notes payable	10,979			3,273
Preferred trust securities	35,000			35,000
Deferred income taxes, net	19,288			19,659
Liabilities of discontinued operations	908			8,603
Total liabilities	494,103			513,937
Commitments and Contingencies (Note 17)
Stockholders' Equity:
Preferred stock, par value $0.01; 10,000,000 shares authorized; none issued	—			—
Common stock, par value $0.01; 150,000,000 shares authorized; 21,287,525 and 20,912,853 shares issued at June 30, 2014 and December 31, 2013, respectively, including shares in treasury	213			209
Treasury stock, at cost; 1,224,182 shares at June 30, 2014 and December 31, 2013	(8,014		)	(8,014		)
Additional paid-in capital	100,121			99,398
Accumulated other comprehensive loss, net of tax	(1,560		)	(3,665		)
Retained earnings	78,706			72,532
Stockholders' equity before non-controlling interests	169,466			160,460
Non-controlling interests	5,873			6,033
Total stockholders' equity	175,339			166,493
Total liabilities and stockholders' equity	$	669,442		$	680,430

See accompanying Notes to Consolidated Financial Statements.

3

FORTEGRA FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

(All Amounts in Thousands, Except Share and Per Share Amounts)

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014		2013			2014		2013
Revenues:
Service and administrative fees	$	42,074	$	42,040		$	86,042	$	80,898
Ceding commissions	11,996		6,957			22,545		14,120
Net investment income	777		746			1,484		1,649
Net realized investment gains	4		1,280			5		1,287
Net earned premium	33,163		33,681			68,091		66,823
Other income	510		243			885		334
Total revenues	88,524		84,947			179,052		165,111
Expenses:
Net losses and loss adjustment expenses	9,877		10,604			20,703		21,139
Member benefit claims	10,511		11,424			21,182		20,790
Commissions	40,842		36,986			80,913		72,348
Personnel costs	9,980		9,508			20,171		20,305
Other operating expenses	8,237		8,364			16,462		16,439
Depreciation and amortization	1,229		1,205			2,478		2,382
Amortization of intangibles	1,318		1,299			2,635		2,767
Interest expense	934		946			1,854		1,799
Loss on note receivable	—		—			1,317		—
(Gain) on sale of subsidiary	—		(402		)	—		(402		)
Total expenses	82,928		79,934			167,715		157,567
Income from continuing operations before income taxes	5,596		5,013			11,337		7,544
Income taxes - continuing operations	1,718		1,593			3,700		2,075
Income from continuing operations before non-controlling interests	3,878		3,420			7,637		5,469
Discontinued operations:
Income from discontinued operations - net of tax	—		1,207			—		2,469
Discontinued operations - net of tax	—		1,207			—		2,469
Net income before non-controlling interests	3,878		4,627			7,637		7,938
Less: net income attributable to non-controlling interests	602		185			1,463		1,003
Net income attributable to Fortegra Financial Corporation	$	3,276	$	4,442		$	6,174	$	6,935
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.17	$	0.17		$	0.31	$	0.23
Discontinued operations - net of tax	—		0.06			—		0.13
Net income attributable to Fortegra Financial Corporation	$	0.17	$	0.23		$	0.31	$	0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.16	$	0.16		$	0.30	$	0.22
Discontinued operations - net of tax	—		0.06			—		0.12
Net income attributable to Fortegra Financial Corporation	$	0.16	$	0.22		$	0.30	$	0.34
Weighted average common shares outstanding:
Basic	19,745,115		19,540,610			19,698,444		19,548,632
Diluted	20,440,133		20,523,090			20,463,929		20,583,951

See accompanying Notes to Consolidated Financial Statements.

4

FORTEGRA FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)

(All Amounts in Thousands)

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Net income before non-controlling interests	$	3,878		$	4,627		$	7,637		$	7,938
Other comprehensive income (loss), net of tax:
Unrealized gains (losses) on available-for-sale securities:
Unrealized holding gains (losses) arising during the period	1,568			(3,223		)	2,943			(3,274		)
Related tax (expense) benefit	(549		)	1,128			(1,030		)	1,146
Reclassification of (gains) included in net income	(4		)	(1,279		)	(5		)	(1,286		)
Related tax expense	2			448			2			450
Unrealized gains (losses) on available-for-sale securities, net of tax	1,017			(2,926		)	1,910			(2,964		)
Interest rate swap:
Unrealized (loss) gain on interest rate swap	(212		)	532			(257		)	564
Related tax benefit (expense)	74			(186		)	89			(197		)
Reclassification of losses included in net income	286			282			568			559
Related tax benefit	(100		)	(99		)	(199		)	(196		)
Unrealized gain on interest rate swap, net of tax	48			529			201			730
Other comprehensive income (loss), net of tax	1,065			(2,397		)	2,111			(2,234		)
Comprehensive income	4,943			2,230			9,748			5,704
Less: comprehensive income attributable to non-controlling interests	605			174			1,469			992
Comprehensive income attributable to Fortegra Financial Corporation	$	4,338		$	2,056		$	8,279		$	4,712

See accompanying Notes to Consolidated Financial Statements.

5

FORTEGRA FINANCIAL CORPORATION

CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited)

(All Amounts in Thousands, Except Share Amounts)

	Common Stock			Treasury Stock					Additional Paid-in Capital			Accumulated Other Comprehensive Income (Loss)			Retained Earnings		Non-controlling Interests			Total Stockholders' Equity
	Shares	Amount		Shares		Amount
Balance, December 31, 2013	20,912,853	$	209	(1,224,182	)	$	(8,014	)	$	99,398		$	(3,665	)	$	72,532	$	6,033		$	166,493
Net income	—	—		—		—			—			—			6,174		1,463			7,637
Other comprehensive income, net of tax	—	—		—		—			—			2,105			—		6			2,111
Distributions to non-controlling interest partners	—	—		—		—			—			—			—		(1,380		)	(1,380		)
Non-controlling interest attributable to the consolidation of Creative Investigations Recovery Group, LLC	—	—		—		—			—			—			—		(249		)	(249		)
Stock-based compensation	114,944	2		—		—			611			—			—		—			613
Direct stock awards to employees	264	—		—		—			1			—			—		—			1
Shares issued for the Employee Stock Purchase Plan	18,642	—		—		—			113			—			—		—			113
Options exercised, net of shares surrendered	240,822	2		—		—			(2		)	—			—		—			—
Balance, June 30, 2014	21,287,525	$	213	(1,224,182	)	$	(8,014	)	$	100,121		$	(1,560	)	$	78,706	$	5,873		$	175,339

See accompanying Notes to Consolidated Financial Statements.

6

FORTEGRA FINANCIAL CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

(All Amounts in Thousands)

	For the Six Months Ended June 30,
	2014			2013
Operating Activities:
Net income attributable to Fortegra Financial Corporation	$	6,174		$	6,935
Adjustments to reconcile net income to net cash flows (used in) provided by operating activities:
Change in deferred acquisition costs	10,201			(6,359		)
Depreciation and amortization	5,113			6,413
Deferred income tax (benefit) - continuing operations	(1,508		)	(553		)
Deferred income tax expense - discontinued operations	—			369
Net realized investment gains	(5		)	(1,287		)
Loss on note receivable	1,317			—
Gain on sale of subsidiary	—			(402		)
Stock-based compensation expense	613			675
Direct stock awards to employees	1			2
Amortization of premiums and accretion of discounts on investments	885			753
Non-controlling interests	1,463			1,003
Change in allowance for doubtful accounts	(308		)	(55		)
Changes in operating assets and liabilities, net of the effects of acquisitions and dispositions:
Accrued investment income	(229		)	13
Accounts and premiums receivable, net	3,293			(9,750		)
Other receivables	3,355			(19,456		)
Reinsurance receivables	(3,990		)	3,934
Income taxes receivable	—			2,919
Other assets	(1,513		)	(525		)
Unpaid claims	3,817			(1,483		)
Unearned premiums	2,398			(2,488		)
Policyholder account balances	(1,405		)	(1,183		)
Accrued expenses, accounts payable and other liabilities	(6,585		)	23,560
Income taxes payable	(120		)	203
Deferred revenue	(17,419		)	12,727
Change in assets of discontinued operations	300			—
Change in liabilities of discontinued operations	(7,695		)	—
Net cash flows (used in) provided by operating activities	(1,847		)	15,965
Investing activities:
Proceeds from maturities, calls and prepayments of available-for-sale investments	19,996			4,755
Proceeds from sales of available-for-sale investments	3,804			27,524
Net change in short-term investments	—			251
Purchases of available-for-sale investments	(35,511		)	(50,056		)
Purchases of property and equipment	(1,281		)	(1,892		)
Net paid for acquisitions of subsidiaries, net of cash received	20			(2,902		)
Sale of subsidiaries, net of cash paid	—			2,180
Net (issuance) from notes receivable	(7,658		)	—
Net proceeds from notes receivable	—			260
Net proceeds from related party note receivable	—			6,135
Change in restricted cash	5,014			1,910
Net cash flows (used in) investing activities	(15,616		)	(11,835		)
Financing activities:
Payments on notes payable	(49,100		)	(12,439		)
Proceeds from notes payable	56,806			10,500
Net proceeds from exercise of stock options	—			49
Purchase of treasury stock	—			(1,357		)
Net proceeds received from stock issued in the Employee Stock Purchase Plan	113			152
Distributions to non-controlling interest partners	(1,380		)	(611		)
Dividends paid to non-controlling interests	—			(43		)
Net cash flows provided by (used in) financing activities	6,439			(3,749		)
Net (decrease) increase in cash and cash equivalents	(11,024		)	381
Cash and cash equivalents, beginning of period	21,681			15,209
Cash and cash equivalents, end of period	$	10,657		$	15,590

See accompanying Notes to Consolidated Financial Statements.

7

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

Nature of Operations

Fortegra Financial Corporation (references in this Form 10-Q to "Fortegra Financial," "Fortegra," "we," "us," "the Company" or similar terms refer to Fortegra Financial Corporation and its subsidiaries), traded on the New York Stock Exchange under the symbol: FRF, is an insurance services company headquartered in Jacksonville, Florida. Fortegra offers a wide array of revenue enhancing products, including payment protection products, motor club memberships, service contracts, device and warranty services, and administration services, to our business partners, including insurance companies, retailers, dealers, insurance brokers and agents and financial services companies. In 2008, the Company changed its name from Life of the South Corporation to Fortegra Financial Corporation. The Company incorporated in the State of Georgia in 1981 and re-incorporated in the State of Delaware in 2010. The Company generates most of its business through networks of small to mid-sized community and regional banks, small loan companies, independent wireless retailers and automobile dealerships. The Company's subsidiaries (owned 100% directly or indirectly by the Company, unless otherwise noted below) at June 30, 2014, are as follows:

• 4Warranty Corporation ("4Warranty")

• Auto Knight Motor Club, Inc. ("Auto Knight")

• Continental Car Club, Inc. ("Continental")

• CRC Reassurance Company, Ltd. ("CRC") *

• Digital Leash, LLC, d/b/a ProtectCELL ("ProtectCELL"), 62.4% owned

• Insurance Company of the South ("ICOTS") *

• Life of the South Insurance Company ("LOTS") * and its subsidiary, Bankers Life of Louisiana ("Bankers Life") *

• LOTS Intermediate Co. ("LOTS IM")

• LOTS Reassurance Company ("LOTS RE") *

• LOTSolutions, Inc.

• Lyndon Southern Insurance Company ("Lyndon Southern") *

• Pacific Benefits Group Northwest, LLC ("PBG")

• Response Indemnity Company of California ("RICC") *

• South Bay Acceptance Corporation ("South Bay")

• South Bay Financial Services, LLC ("SBFS")

• Southern Financial Life Insurance Company ("SFLAC"), 85.0% owned *

• United Motor Club of America, Inc. ("United")

* = Insurance company subsidiary

1. Basis of Presentation

The accompanying unaudited interim Consolidated Financial Statements of Fortegra have been prepared in conformity with generally accepted accounting principles in the United States of America ("U.S. GAAP") promulgated by the Financial Accounting Standards Board ("FASB") through the Accounting Standards Codification ("ASC") for interim financial information, and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the disclosures and footnotes required by U.S. GAAP for complete financial statements and should be read in conjunction with the Company's 2013 Form 10-K.

The interim consolidated financial statements in this Form 10-Q have not been audited. In the opinion of management, the accompanying unaudited interim financial information reflects all adjustments, including normal recurring adjustments necessary to present fairly Fortegra's financial position, results of operations, comprehensive income and cash flows for each of the interim periods presented. The results of operations for the three and the six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the full year ending on December 31, 2014.

2. Summary of Significant Accounting Policies

Fortegra's interim Consolidated Financial Statements as of June 30, 2014 and 2013 are unaudited and have been prepared following the significant accounting policies disclosed in Note 2, "Summary of Significant Accounting Policies," of the Notes to Consolidated Financial Statements of the Company's 2013 Form 10-K.

Principles of Consolidation

The Consolidated Financial Statements include the accounts of Fortegra Financial Corporation and its majority-owned and controlled subsidiaries. The Company eliminates all material intercompany account balances and transactions.

Non-Controlling Interests

The third-party ownership of the common stock of SFLAC and of the ownership interests of ProtectCELL, which is treated as a partnership for income tax purposes, have been reflected as non-controlling interests on the Consolidated Balance Sheets. In addition, the Company's non-controlling interest includes the amount for the consolidation of the variable interest entity ("VIE"), Creative

8

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

Investigations Recovery Group, LLC ("CIRG"). The following table shows the amount outstanding and the percentage of non-controlling interest by entity:

	At
	June 30, 2014					December 31, 2013
	Amount			Percent		Amount		Percent
ProtectCELL	$	5,551		37.6	%	$	5,471	37.6	%
SFLAC	585			15.0	%	562		15.0	%
CIRG	(263		)	100.0	%	—		—	%
Total non-controlling interests	$	5,873				$	6,033

Income (loss) attributable to these non-controlling interests are presented on the Consolidated Statements of Income as net income (loss) attributable to non-controlling interests and on the Consolidated Statements of Comprehensive Income as comprehensive income (loss) attributable to non-controlling interests.

Reportable Segment

The Company reports operating results and financial data in one operating and one reportable segment, Protection Products and Services. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker. The financial results of the Company's single segment are equal to the net income from continuing operations reported in the Consolidated Statements of Income for all periods presented.

Discontinued Operations

The results of operations of a business of the Company that either has been disposed of or is classified as held-for-sale are reported in discontinued operations if: 1) the operations and cash flows of the component have been or will be eliminated from the ongoing operations of the Company as a result of the disposal transaction; and 2) the Company will not have any significant continuing involvement in the operations of the component after the disposal transaction. The Company presents the operations of business(es) that meet the criteria for reporting as discontinued operations, and retrospectively reclassifies operating results for all prior periods presented.

On December 31, 2013, the Company completed the sale of its 100% ownership of Bliss and Glennon and eReinsure.com ("eReinsure"). The operating results of these businesses are presented in the line "Income from discontinued operations - net of tax" in the Consolidated Statements of Income for the three and the six months ended June 30, 2013. In accordance with accounting guidance, the Company has elected to not separately disclose the cash flows related to the Bliss and Glennon and eReinsure discontinued operations. In addition, certain assets and liabilities associated with the disposition of Bliss and Glennon and eReinsure that are still subject to final settlement are included in the line items "Assets of discontinued operations" and "Liabilities of discontinued operations," in the Consolidated Balance Sheet at June 30, 2014 and at December 31, 2013. See the Note, "Divestitures," for more information on discontinued operations.

Comprehensive Income (Loss)

Comprehensive income (loss) includes net income and other items of comprehensive income (loss). These other items are generally comprised of unrealized gains and losses on investment securities classified as available-for-sale and unrealized gains and losses on the interest rate swap, net of the related tax effects.

Use of Estimates

Preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

Certain items in prior period consolidated financial statements were reclassified to conform to the current period presentation, which had no impact on net income, comprehensive income or loss, net cash provided by operating activities or stockholders' equity.

Subsequent Events

The Company reviewed all material events subsequent to June 30, 2014 that occurred up to the date on which the Company filed its Consolidated Financial Statements, to determine whether any event required recognition or disclosure in these Consolidated Financial Statements and/or disclosure in the notes thereto. For more information, please see the Note, "Subsequent Events."

Recently Adopted Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update ("ASU") No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, to clarify the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU No. 2013-11

9

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

is effective prospectively for years and interim periods within those years beginning after December 15, 2013. The adoption of ASU No. 2013-11 did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Recently Issued Accounting Pronouncements

In June 2014, the FASB issued ASU No. 2014-12, Compensation - Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period. ASU No. 2014-12 requires that awards which contain a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. ASU No. 2014-12 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. ASU No. 2014-12 maybe applied using two methods: a) prospectively to all awards granted or modified after the effective date or b) retrospectively to all awards with performance targets outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The Company is currently reviewing ASU No. 2014-12 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  ASU No. 2014-09 is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  ASU No. 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  ASU No. 2014-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods, using either the full retrospective adoption or the modified retrospective adoption. ASU No. 2014-09 does not permit early adoption. The Company is currently reviewing ASU No. 2014-09 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU No. 2014-08 requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations and also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. ASU No. 2014-08 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014 (early adoption is permitted only for disposals that have not been previously reported). The adoption of ASU No. 2014-08 is not expected to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

3. Earnings Per Share

The following table details the earnings per share calculation:	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Numerator: (for both basic and diluted earnings per share)
Income from continuing operations before non-controlling interests	$	3,878	$	3,420	$	7,637	$	5,469
Less: net income attributable to non-controlling interests	602		185		1,463		1,003
Net income from continuing operations - net of tax	3,276		3,235		6,174		4,466
Discontinued operations - net of tax	—		1,207		—		2,469
Net income attributable to Fortegra Financial Corporation	$	3,276	$	4,442	$	6,174	$	6,935
Denominator:
Total weighted average basic common shares outstanding	19,745,115		19,540,610		19,698,444		19,548,632
Effect of dilutive stock options and restricted stock awards	695,018		982,480		765,485		1,035,319
Total weighted average diluted common shares outstanding	20,440,133		20,523,090		20,463,929		20,583,951
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.17	$	0.17	$	0.31	$	0.23
Discontinued operations - net of tax	—		0.06		—		0.13
Net income attributable to Fortegra Financial Corporation	$	0.17	$	0.23	$	0.31	$	0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.16	$	0.16	$	0.30	$	0.22
Discontinued operations - net of tax	—		0.06		—		0.12
Net income attributable to Fortegra Financial Corporation	$	0.16	$	0.22	$	0.30	$	0.34
Weighted average anti-dilutive common shares	515,768		887,046		505,207		763,909

10

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

4. Accumulated Other Comprehensive Income

The following table presents the activity in accumulated other comprehensive income (loss) ("AOCI") for the following periods:

	For the Six Months Ended June 30, 2014
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2013, net of tax	$	(1,761	)	$	(1,904	)	$	(3,665	)
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)	2,943			(257		)	2,686
Income tax (expense) benefit	(1,030		)	89			(941		)
Other comprehensive income (loss) before reclassifications, net of tax	1,913			(168		)	1,745
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(5		)	568			563
Income tax expense (benefit)	2			(199		)	(197		)
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(3		)	369			366
Current period other comprehensive income, net of tax	1,910			201			2,111
Less: other comprehensive income attributable to non-controlling interest	6			—			6
Balance at June 30, 2014, net of tax	$	143		$	(1,703	)	$	(1,560	)
	For the Six Months Ended June 30, 2013
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2012, net of tax	$	2,189		$	(2,820	)	$	(631	)
Other comprehensive income (loss) before reclassifications:
Pre-tax (loss) income	(3,274		)	564			(2,710		)
Income tax benefit (expense)	1,146			(197		)	949
Other comprehensive (loss) income before reclassifications, net of tax	(2,128		)	367			(1,761		)
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(1,286		)	559			(727		)
Income tax expense (benefit)	450			(196		)	254
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(836		)	363			(473		)
Current period other comprehensive (loss) income, net of tax	(2,964		)	730			(2,234		)
Less: other comprehensive (loss) attributable to non-controlling interest	(11		)	—			(11		)
Balance at June 30, 2013, net of tax	$	(764	)	$	(2,090	)	$	(2,854	)

11

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the reclassifications out of AOCI for the following periods:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013			Consolidated Statement of Income Location
Unrealized gains (losses) on available-for-sale securities:
Reclassification of gains included in net income	$	4		$	1,279		$	5		$	1,286		Net realized investment gains (losses)
Related tax (expense)	(2		)	(448		)	(2		)	(450		)	Income taxes
Net of tax	$	2		$	831		$	3		$	836		Net Income
Unrealized gain (loss) on interest rate swap:
Reclassification of (losses) included in net income	$	(286	)	$	(282	)	$	(568	)	$	(559	)	Interest expense
Related tax benefit	100			99			199			196			Income taxes
Net of tax	$	(186	)	$	(183	)	$	(369	)	$	(363	)	Net Income

5. Investments

The following table presents the Company's available-for-sale fixed maturity and equity securities:

	At June 30, 2014
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	46,951	$	469	$	(271	)	$	47,149
Municipal securities	34,088		184		(148		)	34,124
Corporate securities	62,086		704		(256		)	62,534
Obligations of foreign governments	993		16		—			1,009
Total fixed maturity securities	$	144,118	$	1,373	$	(675	)	$	144,816
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		35		(219		)	5,790
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	52	$	(232	)	$	6,901

	At December 31, 2013
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,971	$	142	$	(678	)	$	51,435
Municipal securities	24,856		104		(413		)	24,547
Corporate securities	56,050		210		(900		)	55,360
Obligations of foreign governments	411		—		(2		)	409
Total fixed maturity securities	$	133,288	$	456	$	(1,993	)	$	131,751
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		—		(887		)	5,087
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	17	$	(900	)	$	6,198

Pursuant to certain reinsurance agreements and statutory licensing requirements, the Company has deposited invested assets in custody accounts or insurance department safekeeping accounts. The Company cannot remove invested assets from these accounts without prior approval of the contractual party or regulatory authority, as applicable. The following table presents the Company's restricted investments included in the Company's available-for-sale fixed maturity securities:

12

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

	At
	June 30, 2014		December 31, 2013
Fair value of restricted investments for special deposits required by state insurance departments	$	10,307	$	10,339
Fair value of restricted investments in trust pursuant to reinsurance agreements	5,661		6,134
Total fair value of restricted investments	$	15,968	$	16,473

The following table presents the amortized cost and fair value of fixed maturity securities by contractual maturity. Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

	At June 30, 2014				At December 31, 2013
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	9,775	$	9,834	$	18,766	$	18,771
Due after one year through five years	67,865		68,259		69,380		69,355
Due after five years through ten years	43,577		43,636		22,622		21,731
Due after ten years	22,901		23,087		22,520		21,894
Total fixed maturity securities	$	144,118	$	144,816	$	133,288	$	131,751

The following tables present information on unrealized losses on investment securities that have been in an unrealized loss position for less than twelve months, and twelve months or greater:

	At June 30, 2014
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	6,102	$	10	18	$	7,950	$	261	13	$	14,052	$	271	31
Municipal securities	6,852		34		17	4,983		114		10	11,835		148		27
Corporate securities	6,337		25		14	10,228		231		15	16,565		256		29
Total fixed maturity securities	$	19,291	$	69	49	$	23,161	$	606	38	$	42,452	$	675	87
Preferred stock - publicly traded	792		8		1	3,981		211		7	4,773		219		8
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	792	$	8	1	$	4,012	$	224	9	$	4,804	$	232	10

	At December 31, 2013
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	37,385	$	672	67	$	234	$	6	7	$	37,619	$	678	74
Municipal securities	10,080		413		23	—		—		—	10,080		413		23
Corporate securities	27,866		734		55	7,676		166		8	35,542		900		63
Obligations of foreign governments	409		2		1	—		—		—	409		2		1
Total fixed maturity securities	$	75,740	$	1,821	146	$	7,910	$	172	15	$	83,650	$	1,993	161
Preferred stock - publicly traded	5,087		887		9	—		—		—	5,087		887		9
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	5,087	$	887	9	$	31	$	13	2	$	5,118	$	900	11

The Company does not intend to sell the investments that were in an unrealized loss position at June 30, 2014, and management believes that it is more likely than not that the Company will be able to hold these securities until full recovery of their amortized cost basis for fixed maturity securities or cost for equity securities. As of June 30, 2014, based on the Company's review, none of the fixed maturity or equity securities were deemed to be other-than-temporarily impaired based on the Company's analysis of the securities and its intent to hold the securities until recovery.

13

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the total gross proceeds from the sale of available-for-sale investment securities:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Gross proceeds from sales	$	3,303	$	27,112	$	3,804	$	27,524

The following table presents the gross realized gains and gross realized losses for both fixed maturity and equity securities and realized losses for other-than-temporary impairments for available-for-sale investment securities:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014		2013			2014		2013
Gross realized gains	$	4	$	1,355		$	5	$	1,362
Gross realized losses	—		(75		)	—		(75		)
Total net gains from investment sales	4		1,280			5		1,287
Impairment write-downs (other-than-temporary impairments)	—		—			—		—
Net realized investment gains	$	4	$	1,280		$	5	$	1,287

The following table presents the components of net investment income:	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Fixed income securities	$	678		$	675		$	1,293		$	1,412
Cash on hand and on deposit	—			16			—			36
Common and preferred stock dividends	98			101			196			177
Notes receivable	93			68			186			140
Other income	5			—			5			114
Investment expenses	(97		)	(114		)	(196		)	(230		)
Net investment income	$	777		$	746		$	1,484		$	1,649

6. Reinsurance Receivables

The following table presents the effect of reinsurance on premiums written and earned:

Premiums	For the Three Months Ended June 30,												For the Six Months Ended June 30,
	2014						2013						2014						2013
	Written			Earned			Written			Earned			Written			Earned			Written			Earned
Direct and assumed	$	120,204		$	110,779		$	99,978		$	91,854		$	221,676		$	219,278		$	181,488		$	183,976
Ceded	(86,828		)	(77,616		)	(63,810		)	(58,173		)	(156,418		)	(151,187		)	(114,487		)	(117,153		)
Net	$	33,376		$	33,163		$	36,168		$	33,681		$	65,258		$	68,091		$	67,001		$	66,823

The following table presents the effect of reinsurance on losses and loss adjustment expenses ("LAE") incurred:

Losses and LAE incurred	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Direct and assumed	$	27,023		$	22,485		$	53,141		$	43,525
Ceded	(17,146		)	(11,881		)	(32,438		)	(22,386		)
Net losses and LAE incurred	$	9,877		$	10,604		$	20,703		$	21,139

14

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the components of the reinsurance receivables:	At
	June 30, 2014		December 31, 2013
Prepaid reinsurance premiums:
Life (1)	$	49,219	$	51,355
Accident and health (1)	35,792		36,214
Property	105,228		98,650
Total	190,239		186,219
Ceded claim reserves:
Life	1,460		1,594
Accident and health	7,313		7,826
Property	16,458		12,102
Total ceded claim reserves recoverable	25,231		21,522
Other reinsurance settlements recoverable	3,604		7,343
Reinsurance receivables	$	219,074	$	215,084

⁽¹⁾ Including policyholder account balances ceded.

The following table presents the aggregate amount included in reinsurance receivables that is comprised of the three largest receivable balances from unrelated reinsurers:

	At
	June 30, 2014		December 31, 2013
Total of the three largest receivable balances from unrelated reinsurers	$	137,328	$	136,061

At June 30, 2014 and December 31, 2013, respectively, the three unrelated reinsurers from whom the Company has the largest receivable balances were: London Life Reinsurance Company (A. M. Best Rating: A), London Life International Reinsurance Corporation (A. M. Best Rating: Not rated) and Spartan Property Insurance Company (A. M. Best Rating: Not rated). The related receivables of Spartan Property Insurance Company and London Life International Reinsurance Corporation are collateralized by assets held in trust accounts and letters of credit due to their offshore relationships. At June 30, 2014, the Company does not believe there is a risk of loss as a result of the concentration of credit risk in the reinsurance program.

7. Deferred Acquisition Costs

Deferred Acquisition Costs - Insurance Related

The following table presents the amortization of deferred acquisition costs for the Company's insurance contracts:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - insurance related	$	15,678	$	16,147	$	32,920	$	32,438

Deferred Acquisition Costs - Non-insurance Related

The following table presents the amortization of deferred acquisition costs for the Company's non-insurance products:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - non-insurance related	$	17,278	$	20,971	$	35,292	$	35,884

8. Divestitures

Discontinued Operations

On December 31, 2013, the Company completed the sale of all of the issued and outstanding stock of its subsidiaries Bliss and Glennon and eReinsure, to AmWINS Holdings, LLC, a North Carolina limited liability company ("AmWINS") (collectively, the "Disposition"), pursuant to the terms of the Stock Purchase Agreement (the "Purchase Agreement"), dated December 2, 2013.

The Company received net cash proceeds of $81.8 million for the Disposition, representing gross proceeds of $83.5 million less $1.0 million in transaction fees paid at the time of closing and $0.7 million of cash held by the disposed entities. The proceeds are subject

15

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

to certain purchase price adjustments as set forth in the Purchase Agreement to reflect fluctuations in working capital, including adjustments for any receivable balances as of the disposition date not collected within one year.

As a result of the Disposition, the Company no longer operates in the businesses of wholesale insurance brokerage and selling or licensing of a computerized system or platform for the negotiation and/or placement of facultative reinsurance. As of and after December 31, 2013, the Company does not beneficially own the disposed businesses and will no longer consolidate Bliss and Glennon or eReinsure into its financial results. The historical financial results of the disposed businesses for periods prior to the Disposition are presented in the Company's Consolidated Statements of Income as income from discontinued operations - net of tax. The Company allocated interest expense to the discontinued operations based on the anticipated net proceeds that would have been applied to the repayment of the credit facilities outstanding at the respective time, multiplied by the respective interest rate of the credit facilities at the respective time.

The following table presents the assets and liabilities of the discontinued operations included on the Consolidated Balance Sheets:

	At
	June 30, 2014		December 31, 2013
Assets:
Other receivables (1)	$	491	$	791
Assets of discontinued operations	$	491	$	791
Liabilities:
Accrued expenses, accounts payable and other liabilities	$	908	$	2,708
Income taxes payable	—		5,895
Liabilities of discontinued operations	$	908	$	8,603

⁽¹⁾ - In June 2014, $0.3 million was reclassified between liabilities and assets associated with discontinued operations, based on revised estimates of working capital and payment obligations.

The following table presents the amounts related to the Company's discontinued operations in the Consolidated Statements of Income for the following period:

	For the Three Months Ended		For the Six Months Ended
	June 30, 2013		June 30, 2013
Income from discontinued operations:
Revenues:
Brokerage commissions and fees	$	9,891	$	19,622
Net investment income	6		12
Other income	16		16
Total revenues	9,913		19,650
Expenses:
Personnel costs	5,086		10,135
Other operating expenses	1,546		2,888
Depreciation and amortization	162		303
Amortization of intangibles	481		961
Interest expense	598		1,189
Total expenses	7,873		15,476
Income from discontinued operations before income taxes	2,040		4,174
Income taxes - discontinued operations	833		1,705
Income from discontinued operations - net of tax	$	1,207	$	2,469

16

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

9. Other Intangible Assets

The following table presents finite-lived other intangible assets and their respective amortization periods:

				At June 30, 2014							At December 31, 2013
	Amortization Period (Years)			Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Customer and agent relationships	7	to	15	$	40,075	$	(15,413	)	$	24,662	$	40,075	$	(13,262	)	$	26,813
Tradenames	8	to	10	1,460		(204		)	1,256		1,460		(128		)	1,332
Software	2.25	to	10	5,336		(3,304		)	2,032		5,336		(2,930		)	2,406
Present value of future profits	0.3	to	0.75	548		(548		)	—		548		(548		)	—
Non-compete agreements	1.5	to	6	1,378		(929		)	449		1,378		(895		)	483
Total finite-lived other intangible assets				$	48,797	$	(20,398	)	$	28,399	$	48,797	$	(17,763	)	$	31,034

The following table presents the carrying amount of indefinite-lived other intangible assets:	At
	June 30, 2014		December 31, 2013
Tradenames	$	17,764	$	17,764
Licenses	375		375
Total	$	18,139	$	18,139

The following table presents the activity in finite and indefinite-lived other intangible assets:

Balance at December 31, 2013	$	49,173
Less: amortization expense	2,635
Balance at June 30, 2014	$	46,538

The following table presents estimated amortization of finite-lived other intangible assets for the next five years and thereafter ending December 31:

	Estimated Amortization Expense
Remainder of 2014	$	2,635
2015	5,115
2016	4,868
2017	3,648
2018	2,230
Thereafter	9,903
Total	$	28,399

10. Variable Interest Entity

In July 2011, the Company sold its 100% interest in CIRG. The consideration included a note receivable, with a first priority lien security interest in the assets of CIRG and other property of the buyers. As previously disclosed, the Company has a variable interest in CIRG. Prior to March 31, 2014, the Company did not consolidate CIRG into its results, because the Company was not the primary beneficiary.

During 2013, the buyers were unable to make the scheduled payments on the note, and the parties executed a forbearance agreement along with a security agreement and a subordination agreement designed to allow more flexibility in timing of repayment. The Company also provided $0.1 million in short term funding.

In March 2014, the Company notified the buyers of the cessation of forbearance, and began to exercise certain of the rights and remedies afforded by the note and related agreements to preserve its economic interest, including steps to protect assets of CIRG. The Company also provided additional short term funding. The Company has not taken ownership of CIRG, but the Company now has power over the VIE, and has consolidated the immaterial balances of CIRG as of June 30, 2014.

In March 2014, the Company established an allowance for the full value of the note and accrued interest, incurring a charge of $1.3 million during the three months ended March 31, 2014. The Company's maximum exposure to further loss in the VIE is limited to the balance of the short term funding.

17

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

	At
	June 30, 2014
The Company's maximum exposure to loss in the VIE	$	184

11. Notes Payable

The Company's Notes Payable consisted of the following:	At
	June 30, 2014			December 31, 2013
Wells Fargo Bank, N.A. credit facility, maturing August 2019	$	3,000		$	—
Synovus Bank, revolving line of credit, maturing April 2017	7,979			3,273
Total	$	10,979		$	3,273
Maximum balance allowed on the Wells Fargo Bank, N.A. credit facility	$	100,000		$	75,000
Interest rate at the end of the respective period, Wells Fargo Bank, N.A. credit facility (1) (2)	1.80		%	—		%
Maximum balance allowed on the Synovus Bank, revolving line of credit	$	15,000		$	15,000
Interest rate at the end of the respective period, Synovus Bank, revolving line of credit	3.23		%	3.24		%

⁽¹⁾ - At June 30, 2014, the full outstanding balance of the Company's borrowing, under the Revolving Facility, consisted of a one-month term loan at a rate equaling the one-month LIBOR rate plus 1.65%.

⁽²⁾ - At December 31, 2013, the Company had no borrowings outstanding under the Revolving Facility, thus no interest rate can be defined.

The following table presents the aggregate maturities for the Company's notes payable by year at June 30, 2014:

	Maturities
Remainder of 2014	$	10,979
2015	—
2016	—
2017	—
2018	—
Thereafter	—
Total maturities	$	10,979

$100.0 million Secured Credit Agreement - Wells Fargo Bank, N.A.

On April 11, 2014, the Company amended the original credit agreement, entered into on August 2, 2012, (as amended, the "Credit Agreement"), with a syndicate of lenders, among them Wells Fargo Bank, N.A., who also serves as administrative agent ("Wells Fargo" or the "Administrative Agent"). The Credit Agreement matures on August 2, 2019 (subject to earlier termination) and has a revolving credit facility limit of $100.0 million (the "Revolving Facility") with a sub-limit of $10.0 million for swingline loans and $10.0 million for letters of credit. The Credit Agreement includes a provision pursuant to which, from time to time, the Company may request that the lenders in their discretion increase the maximum amount of commitments under the Credit Agreement by an amount not to exceed $50.0 million. The Credit Agreement also contains financial covenants, which the Company must maintain. See the section below, "Financial Covenants" for a presentation of the Company's more significant covenants associated with the Credit Agreement. The amendment to the Credit Agreement reduced the interest rate margin on revolving loans by 0.35% for each pricing level and reduced the unused line fee paid on undrawn revolving commitments by 0.05% for each pricing level. The amendment did not modify the financial covenants.

Financial Covenants - Secured Credit Agreement - Wells Fargo Bank, N.A.

At June 30, 2014 and December 31, 2013, respectively, the Company was required to comply with various financial covenants set forth in the Credit Agreement. The following describes the Credit Agreement's more significant financial covenants in effect at June 30, 2014 and the calculations used to arrive at each ratio (capitalized terms used but not defined in this paragraph are defined in the Credit Agreement or as otherwise provided below):

Total Leverage Ratio- the ratio of (i) Consolidated Total Debt as of such date to (ii) Consolidated Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") for the Measurement Period ending on or immediately prior to such date.

18

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

Fixed Charge Coverage Ratio - the ratio of (a) Consolidated Adjusted EBITDA less the actual amount paid by the Borrowers and their Subsidiaries in cash on account of Capital Expenditures less cash taxes paid by the Borrowers and their Subsidiaries to (b) Consolidated Fixed Charges, in each case for the Measurement Period ending on or immediately prior to such date.

Reinsurance Ratio - the ratio (expressed as a percentage) of (a) the aggregate amounts recoverable by the Borrowers and its Subsidiaries from reinsurers divided by (b) the sum of (i) policy and claim liabilities plus (ii) unearned premiums, in each case of the Borrowers and their Subsidiaries determined in accordance with U.S. GAAP.

Risk-Based Capital ("RBC") Ratio - the ratio (expressed as a percentage) of NAIC RBC (as defined in the NAIC standards) for any Regulated Insurance Company on an individual basis, calculated at the end of any Fiscal Year, to the "authorized control level" (as defined in the NAIC standards).

The following table presents the Credit Agreement's more significant financial covenants at June 30, 2014, or at December 31, 2013 with respect to the RBC ratios, which under the Credit Agreement reflect the ratios calculated as of the most recent year-end:

		Actual At
Covenant	Covenant Requirement	June 30, 2014
Total leverage ratio	not more than 3.25	0.82
Fixed charge coverage ratio	not less than 2.00	4.17
Reinsurance ratio	not less than 50%	69.0%
		Actual At
		December 31, 2013
RBC Ratios:
RBC Ratio - Bankers Life of Louisiana	not less than 250%	435.0%
RBC Ratio - Southern Financial Life Insurance Company	not less than 250%	2,096.0%
RBC Ratio - Insurance Company of the South	not less than 250%	366.0%
RBC Ratio - Lyndon Southern Insurance Company	not less than 250%	305.0%
RBC Ratio - Life of the South Insurance Company	not less than 250%	430.0%
RBC Ratio - Response Indemnity Company of California	not less than 250%	39,754.0%

$15.0 million Revolving Line of Credit - Synovus Bank

At June 30, 2014, the Company's subsidiary, South Bay, had a $15.0 million revolving line of credit agreement (the "Line of Credit") with Synovus Bank, entered into in October 2013, with a maturity date of April 2017.  The Line of Credit bears interest at a rate of 300 basis points plus 90-day LIBOR, and is available specifically for the South Bay premium financing product. The Line of Credit allows South Bay to finance up to 90% of the eligible receivables, less an applicable reserve of $500,000. At June 30, 2014, the balance of premium financing receivables included in notes receivable, net, on the Consolidated Balance Sheet, totaled $11.7 million, of which $9.4 million were eligible receivables. At June 30, 2014, South Bay was in compliance with the covenants required by the Line of Credit.

12. Derivative Financial Instruments - Interest Rate Swap

The Company has an interest rate swap (the "Swap") with Wells Fargo Bank, N.A., pursuant to which the Company swapped the floating rate portion of its outstanding preferred trust securities to a fixed rate. The Swap, designated as a cash flow hedge, commenced in June 2012 and expires in June 2017.

The following table presents the fair value (including accrued interest) and the related outstanding notional amount of the Company's single derivative instrument and indicates where the Company records each amount within its Consolidated Balance Sheets:

		At
	Balance Sheet Location	June 30, 2014			December 31, 2013
Derivative designated as cash flow hedging instrument:
Interest rate swap - notional value		$	35,000		$	35,000
Fair value of the Swap	Accrued expenses, accounts payable and other liabilities	2,619			2,930
Unrealized loss, net of tax, on the fair value of the Swap	AOCI	1,703			1,904
Variable rate of the interest rate swap		0.23		%	0.24		%
Fixed rate of the interest rate swap		3.47		%	3.47		%

19

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the pretax impact of the Swap on the Consolidated Financial Statements for the following periods:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014			2013		2014			2013
(Loss) gain recognized in AOCI on the derivative-effective portion	$	(212	)	$	532	$	(257	)	$	564
Loss reclassified from AOCI into income-effective portion	$	286		$	282	$	568		$	559
Gain (loss) recognized in income on the derivative-ineffective portion	$	—		$	—	$	—		$	—

The following table presents the estimated amount to be reclassified to earnings from AOCI during the next 12 months. These net losses reclassified into earnings are primarily expected to increase net interest expense related to the respective hedged item.

	At
	June 30, 2014
Estimated loss to be reclassified to earnings from AOCI during the next 12 months	$	1,130

13. Stock-Based Compensation

Stock Options

The Company did not grant stock options during the three months ended June 30, 2014. During the six months ended June 30, 2014, the Company granted 15,000 time-based stock options, which vest in equal amounts on each of the four anniversaries of the grant date. The following table presents the Company's time-based and performance-based stock option activity for the current period:

	Time-Based								Performance-Based
	Options Outstanding		Weighted Average Exercise Price (in dollars per share)		Options Exercisable		Weighted Average Exercise Price (in dollars per share)		Options Outstanding	Weighted Average Exercise Price (in dollars per share)		Options Exercisable	Weighted Average Exercise Price (in dollars per share)
Balance, December 31, 2013	1,930,407		$	4.22	1,806,251		$	3.98	289,306	$	8.46	—	$	—
Granted	15,000		8.27		—		—		—	—		—	—
Vested	—		—		3,125		2.81		—	—		—	—
Exercised	(391,389	)	3.10		(391,389	)	3.10		—	—		—	—
Canceled/forfeited	(74,176	)	7.90		(74,176	)	7.90		—	—		—	—
Balance, June 30, 2014	1,479,842		$	4.37	1,343,811		$	4.02	289,306	$	8.46	—	$	—
Weighted average remaining contractual term at June 30, 2014 (in years)	3.5				3.0				8.3			—

The following table presents the weighted average assumptions used to estimate the fair values of all stock options granted during the six months ended June 30, 2014:

	Assumptions
Expected term (years)	6.25
Expected volatility	33.83	%
Expected dividends	—	%
Risk-free rate	2.19	%

Restricted Stock Awards

The Company granted 9,944 time-based restricted stock awards during the three months ended June 30, 2014, which vest in equal amounts on each of the three anniversaries of the grant date. During the six months ended June 30, 2014, the Company also granted 30,000 time-based restricted stock awards to its Chief Executive Officer and 75,000 time-based restricted stock awards, equally distributed to five of its Directors. These awards will vest in equal amounts on each of the three anniversaries of the grant date.

20

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the Company's time-based and performance-based restricted stock award activity for the current period:

	Time-Based				Performance-Based
	Shares		Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Balance at December 31, 2013	139,680		$	8.59	130,629	$	10.20
Grants	114,944		7.24		—	—
Vests	(45,651	)	8.50		—	—
Forfeitures	—		—		—	—
Balance at June 30, 2014	208,973		$	7.87	130,629	$	10.20

Stock-based Compensation Expense

The following table presents the total time-based and performance-based stock-based compensation expense and the related income tax benefit recognized on the Consolidated Statements of Income:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Personnel costs	$	156		$	204		$	315		$	388
Other operating expenses	135			124			266			242
Income tax benefit	(111		)	(126		)	(222		)	(241		)
Net stock-based compensation expense	$	180		$	202		$	359		$	389

Additional information on total non-vested stock-based compensation is as follows:	At June 30, 2014
	Stock Options		Restricted Stock Awards
Unrecognized compensation cost related to non-vested awards	$	338	$	1,357
Weighted-average recognition period (in years)	3.0		3.3

For the three and the six months ended June 30, 2014, the Company did not recognize expense on 149,306 performance-based stock options and 49,768 performance-based restricted stock awards since the attainment of the performance metrics associated with these awards was not probable based on current projections.

Employee Stock Purchase Plan ("ESPP")

The following table presents the information related to the Company's ESPP for the six-month offering period ending on:

	June 30, 2014		June 30, 2013
Common stock issued under the ESPP (in shares)	18,642		26,019
Weighted-average purchase price per share by participant in the ESPP	$	6.04	$	5.83
Total cash proceeds received from the issuance of common shares under the ESPP	$	113	$	152
ESPP compensation costs recognized	$	32	$	46

14. Income Taxes

The following table presents the provision for income taxes for both continuing and discontinued operations:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income taxes - continuing operations	$	1,718	$	1,593	$	3,700	$	2,075
Income taxes - discontinued operations	—		833		—		1,705
Income taxes	$	1,718	$	2,426	$	3,700	$	3,780

21

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

The following table presents the provision for income taxes from continuing operations:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Current	$	2,963		$	3,007		$	5,208		$	2,628
Deferred	(1,245		)	(1,414		)	(1,508		)	(553		)
Income taxes - continuing operations	$	1,718		$	1,593		$	3,700		$	2,075

The following table presents a reconciliation of income taxes from continuing operations calculated at the federal statutory rate of 35% and the income tax expense attributable to continuing operations for the following periods:

	For the Three Months Ended June 30,										For the Six Months Ended June 30,
	2014					2013					2014					2013
	Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income
Income taxes at federal income tax rate	$	1,956		35.00	%	$	1,755		35.00	%	$	3,965		35.00	%	$	2,640		35.00	%
Effect of:
Small life deduction	(103		)	(1.84	)	(82		)	(1.64	)	(210		)	(1.85	)	(191		)	(2.53	)
Non-deductible expenses	22			0.39		20			0.40		44			0.39		39			0.52
Tax exempt interest	(39		)	(0.70	)	(39		)	(0.78	)	(73		)	(0.64	)	(70		)	(0.93	)
State taxes	133			2.38		(10		)	(0.20	)	295			2.60		50			0.66
Non-controlling interest	(206		)	(3.68	)	(65		)	(1.30	)	(510		)	(4.50	)	(351		)	(4.65	)
Other, net	(45		)	(0.80	)	14			0.28		189			1.67		(42		)	(0.56	)
Income taxes - continuing operations	$	1,718		30.75	%	$	1,593		31.76	%	$	3,700		32.67	%	$	2,075		27.51	%

At June 30, 2014, the Company had a net operating loss carry forward of $0.6 million, which is subject to certain limitations under IRC Section 382 and will begin to expire in December 31, 2025. The Company expects to utilize the full amount of the net operating loss carryforward.

The Company has reviewed its uncertain tax positions and management has concluded that there are no additional amounts required to be recorded.

In 2012, the Company was under examination by the Internal Revenue Service ("IRS") for the 2010 and 2009 tax years. In February 2013, the IRS completed its field audit for those tax years and presented its findings.  The Company agreed to those findings and expensed $57.0 thousand in the first quarter of 2013.

The Company's income tax returns are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations by the IRS for the tax years 2011 through 2013. The years open to examination by state taxing authorities vary by jurisdiction. There are no extensions of the statute of limitations to assess income taxes currently in effect.

22

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

15. Fair Value of Financial Instruments 

The carrying and fair values of financial instruments are as follows:	At
	June 30, 2014				December 31, 2013
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets:
Cash and cash equivalents	$	10,657	$	10,657	$	21,681	$	21,681
Restricted cash	12,279		12,279		17,293		17,293
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	47,149		47,149		51,435		51,435
Municipal securities	34,124		34,124		24,547		24,547
Corporate securities	62,534		62,534		55,360		55,360
Obligations of foreign governments	1,009		1,009		409		409
Equity securities:
Common stock - publicly traded	47		47		47		47
Preferred stock - publicly traded	5,790		5,790		5,087		5,087
Common stock - non-publicly traded	51		51		51		51
Preferred stock - non-publicly traded	1,013		1,013		1,013		1,013
Notes receivable	18,297		18,297		11,920		11,920
Accounts and premiums receivable, net	15,743		15,743		18,702		18,702
Other receivables	29,941		29,941		33,409		33,409
Short-term investments	871		871		871		871
Total financial assets	$	239,505	$	239,505	$	241,825	$	241,825
Financial liabilities:
Notes payable	$	10,979	$	10,979	$	3,273	$	3,273
Preferred trust securities	35,000		35,000		35,000		35,000
Interest rate swap	2,619		2,619		2,930		2,930
Total financial liabilities	$	48,598	$	48,598	$	41,203	$	41,203

The Company's financial assets and liabilities accounted for at fair value by level within the fair value hierarchy are as follows:

	At June 30, 2014
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	47,149	$	—	$	47,149	$	—
Municipal securities	34,124		—		34,124		—
Corporate securities	62,534		—		62,534		—
Obligations of foreign governments	1,009		—		1,009		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,790		5,790		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total assets	$	152,588	$	6,708	$	144,816	$	1,064
Financial Liabilities:
Interest rate swap	$	2,619	$	—	$	2,619	$	—

23

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

	At December 31, 2013
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,435	$	—	$	51,435	$	—
Municipal securities	24,547		—		24,547		—
Corporate securities	55,360		—		55,360		—
Obligations of foreign governments	409		—		409		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,087		5,087		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total Assets	$	138,820	$	6,005	$	131,751	$	1,064
Financial Liabilities:
Interest rate swap	$	2,930	$	—	$	2,930	$	—

There were no transfers between Level 1, Level 2 or Level 3 during the three or the six months ended June 30, 2014. The Company's use of Level 3 unobservable inputs included six individual securities that accounted for 0.7% of total investments at June 30, 2014. The Company valued one of the Level 3 equity securities at $1.0 million by taking into account the strength of the issuer's parent company guaranteeing the dividend of the issuer, and another Level 3 equity security at $13.0 thousand, by estimating the total value of the Class-A shares outstanding by the issuer and a review of the company's audited financial statements. The remaining four Level 3 securities, with a combined fair value of $51.0 thousand were valued based on information obtained from a third-party pricing service. At December 31, 2013, the Company had six individual securities valued under Level 3 that accounted for 0.8% of total investments.

The following table presents the changes in Level 3 assets measured at fair value:	For the Six Months Ended June 30,
	2014		2013
Beginning balance, January 1,	$	1,064	$	1,123
Total investment gains or losses (realized/unrealized):
Included in other comprehensive (loss)	—		(25		)
Transfers (out of) Level 3	—		(27		)
Ending balance, June 30,	$	1,064	$	1,071

16. Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions

The Company's insurance company subsidiaries may pay dividends to the Company, subject to statutory restrictions. Payments in excess of statutory restrictions (extraordinary dividends) to the Company are permitted only with prior approval of the insurance department of the applicable state of domicile. The Company eliminated all dividends from its subsidiaries in the Consolidated Financial Statements. The following table presents the dividends paid to the Company by its insurance company subsidiaries for the following periods:

	For the Six Months Ended June 30,		For the Twelve Months Ended December 31,
	2014		2013
Ordinary dividends	$	—	$	2,383
Extraordinary dividends	—		—
Total dividends	$	—	$	2,383

The following table presents the combined statutory capital and surplus of the Company's insurance company subsidiaries, the required minimum statutory capital and surplus, as required by the laws of the states in which they are domiciled and the combined amount available for ordinary dividends of the Company's insurance company subsidiaries for the following periods:

24

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

	At
	June 30, 2014		December 31, 2013
Combined statutory capital and surplus of the Company's insurance company subsidiaries	$	79,757	$	69,269
Required minimum statutory capital and surplus	$	17,200	$	17,200
Amount available for ordinary dividends of the Company's insurance company subsidiaries	$	4,244	$	3,989

At June 30, 2014, the maximum amount of dividends that our regulated insurance company subsidiaries could pay under applicable laws and regulations without regulatory approval was $4.2 million. The Company may seek regulatory approval to pay dividends in excess of this permitted amount, but there can be no assurance that the Company would receive regulatory approval if sought.

Under the NAIC's Risk-Based Capital Act of 1995, a company's Risk-Based Capital ("RBC") is calculated by applying certain risk factors to various asset, claim and reserve items. If a company's adjusted surplus falls below calculated RBC thresholds, regulatory intervention or oversight is required. The Company's insurance company subsidiaries' RBC levels, as calculated in accordance with the NAIC's RBC instructions, exceeded all RBC thresholds as of June 30, 2014 and December 31, 2013, respectively.

17. Commitments and Contingencies

Commitments

The Company, in the ordinary course of normal business, may enter from time to time into certain contractual obligations or commitments. The Company's commitments, as of June 30, 2014, have not materially changed from those disclosed in the note "Commitments and Contingencies," in the Company's 2013 Form 10-K.

Contingencies

The Company is a party to claims and litigation in the normal course of its operations. Management believes that the ultimate outcome of these matters in existence at June 30, 2014 are reserved against, covered by insurance or would not have a material adverse effect on the consolidated financial condition, results of operations or cash flows of the Company.

The Company is currently a defendant in Mullins v. Southern Financial Life Insurance Co., which was filed on February 2, 2006, in the Pike Circuit Court, in the Commonwealth of Kentucky.  A class was certified on June 25, 2010.  At issue is the duration or term of coverage under certain policies.  The action alleges violations of the Consumer Protection Act and certain insurance statutes, as well as common law fraud.  The action seeks compensatory and punitive damages, attorney fees and interest.  The parties are currently involved in the merits discovery phase and discovery disputes have arisen.  Plaintiffs filed a Motion for Sanctions on April 5, 2012 in connection with the Company's efforts to locate and gather certificates and other documents from the Company's agents.  While the court did not award sanctions, it did order the Company to subpoena certain records from its agents.  In an effort to prevent the trial court from enforcing the order, the Company filed a Writ of Prohibition, which the Kentucky Court of Appeals denied on August 31, 2012.  In response, the Company filed a motion for discretionary review of the Writ of Prohibition.  The Company also filed a direct appeal of the same order, on the grounds that the order could be construed as a finding of contempt on the part of the Company.  The Court of Appeals dismissed the direct appeal on September 13, 2013, which prompted the Company to file a motion for discretionary review of the direct appeal.  The Kentucky Supreme Court denied the Writ of Prohibition on November 21, 2013, and subsequently denied the direct appeal in April 2014.  No hearings are currently scheduled and no trial date has been set.

The Company considers such litigation customary in its lines of business.  In management's opinion, based on information available at this time, the ultimate resolution of such litigation, which it is vigorously defending, should not be materially adverse to the financial position, results of operations or cash flows of the Company. It should be noted that large punitive damage awards, bearing little relation to actual damages sustained by plaintiffs, have been awarded in certain states against other companies in the credit insurance business. The Company may record loss contingencies as developments warrant, although such amounts are not reasonably estimable at this time.

18. Related Party Transactions

In conjunction with the December 31, 2012 acquisition of ProtectCELL, the Company assumed an office space lease between ProtectCELL and 39500 High Pointe, LLC ("High Pointe"). The ownership of High Pointe includes three members who were the founding members of ProtectCELL and are now employees of the Company. The table below presents the lease payments made to High Pointe.

At December 31, 2012, ProtectCELL held a $6.1 million note receivable carrying an interest rate of 8.00% from High Pointe, which was fully secured by a mortgage on the office building owned by High Pointe (see the lease described above). On March 15, 2013,

25

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

ProtectCELL received $6.1 million from High Pointe, representing the full payoff of the outstanding balance of the note receivable. The Company only recorded interest income on this note receivable during the three months ended March 31, 2013.

An executive officer of ProtectCELL owned multiple wireless retail locations, which sold ProtectCELL protection plans to wireless retail customers. The executive sold these wireless retail locations in February 2014. The table below presents the income recorded on and the commissions paid for this related party agreement through the sale date of the wireless retail locations.

In conjunction with the December 31, 2012 acquisition of 4Warranty, the Company assumed an office space lease between 4Warranty and Source International Incorporated ("Source"), effective January 1, 2013. The ownership of Source is comprised of two individuals who had consulting relationships with the Company. The lease with Source, which expired on December 31, 2013, was not renewed since the operations of 4Warranty were moved to the Company's main office. The table below presents the lease payments made to Source during the three months and the six months ended June 30, 2013.

In December 2011, the Company entered into a marketing and referral agreement (the "Marketing Agreement") with a company in which a member serving on the Company's Board of Directors also serves on the board of the company providing the marketing services (the "Marketer"). The Marketing Agreement has a five year term and requires the Company to pay the Marketer a per account fee per month based on the number of enrolled customers the Marketer obtains for the Company. In conjunction with the Marketing Agreement, during April 2013, the Company entered into an agreement under which the Marketer began selling insurance-related products of the Company to the Marketer's customers. The Company recorded income and paid claims, associated with the sale of the Company's insurance-related products, which are reflected in the table below.

The following table presents the amounts recorded on the Company's Consolidated Statements of Income resulting from related party transactions:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income recorded by ProtectCELL for protection plans sold	$	—	$	595	$	307	$	1,102
Income recorded for the sale of the Company's insurance-related products under the Marketing Agreement	315		268		632		268
Total related party income recorded by the Company	$	315	$	863	$	939	$	1,370
Interest income recorded on the High Pointe note receivable	$	—	$	—	$	—	$	21
Lease expense paid to High Pointe	$	103	$	103	$	207	$	197
Lease expense paid to Source	—		29		—		58
Total related party lease expense	$	103	$	132	$	207	$	255
Commissions paid by ProtectCELL for protection plans sold	$	—	$	246	$	122	$	451
Claims paid on the Company's insurance-related products under the Marketing Agreement	$	39	$	—	$	62	$	—
The following table presents the amounts recorded on the Company's Consolidated Balance Sheets from related party transactions:
					At
					June 30, 2014		December 31, 2013
Accounts receivable from related parties					$	—	$	113

19. Subsequent Events

The Company measures subsequent events through the date of the filing of its Consolidated Financial Statements. Management has determined that the following events merit disclosure as subsequent events. As previously disclosed by the Company on a Current Report on Form 8-K, filed on August 12, 2014, the Company entered into an Agreement and Plan of Merger on August 11, 2014, to be acquired by subsidiaries of Tiptree Financial Inc. (NASDAQ: TIPT) for approximately $218.0 million in cash.  Tiptree is a publicly traded diversified holding company, with subsidiaries that operate in four industry segments: insurance and insurance services, specialty finance, asset management and real estate.  Following the execution of the merger agreement, stockholders representing approximately 62% of the outstanding shares of Fortegra common stock executed a written consent adopting and approving the merger agreement. No additional stockholder approvals are necessary to adopt the merger agreement or consummate the transaction. The merger agreement includes a 30-day "go-shop" period during which the Company is permitted to solicit and enter into negotiations with interested parties that offer alternative proposals.  Closing of the merger is subject to the satisfaction of customary conditions including, among other

26

FORTEGRA FINANCIAL CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)

(All Amounts in Thousands, Except Share Amounts, Per Share Amounts or Unless Otherwise Noted)

things, insurance regulatory approvals and expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") represents an overview of our results of operations and financial condition. The MD&A should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in ITEM 1 of this Form 10-Q. Except for the historical information contained herein, the discussions in MD&A contain forward-looking statements that involve risks and uncertainties. Our future results could differ materially from those discussed herein. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in PART II, "ITEM 1A. Risk Factors" of this Form 10-Q.

Critical Accounting Policies

Our critical accounting policies involving significant judgments and assumptions used in the preparation of the Consolidated Financial Statements as of June 30, 2014 are unchanged from those presented in the MD&A of Our 2013 Form 10-K.

Recently Issued Accounting Standards

For a discussion of recently issued accounting standards, see the Note "Summary of Significant Accounting Policies" of the Notes to Consolidated Financial Statements included in ITEM 1 of this Form 10-Q.

Components of Revenues and Expenses

For a complete discussion of our "Components of Revenues and Expenses," see the MD&A in PART II, ITEM 7, of Fortegra's 2013 Form 10-K.

Use of Non-GAAP Financial Measures

Management uses certain Non-GAAP financial measures in its analysis of our operating performance.  See "Use of Non-GAAP Financial Information" in this MD&A for a reconciliation of such financial measures to comparable financial measures based on U.S. GAAP.

EXECUTIVE SUMMARY

The following provides an overview of events and financial results for the three and the six months ended June 30, 2014:

Overview of Events

On December 31, 2012, we acquired ProtectCELL and 4Warranty. Their impact on our financial results began in 2013.

In January 2013, we announced a plan to consolidate our fulfillment, claims administration and information technology functions (the "Plan"). Prior to the Plan, such functions resided in our individual business units. The decision was part of our efforts to streamline operations, focus resources and provide first-in-class service to our customers. During the first quarter of 2013, we eliminated approximately 40 employee and contract positions. Subsequently we cross-trained personnel, further refined our mix of skills, and enhanced our tracking of transaction volumes and related metrics, allowing us to efficiently deploy resources to transaction volumes. As a result of the Plan and these changes, we have reduced costs and improved productivity.

On December 31, 2013, we completed the sale of all of the issued and outstanding stock of our subsidiaries, Bliss and Glennon and eReinsure, to AmWINS (the "Disposition"). See the Note, "Divestitures" in the Notes to Consolidated Financial Statements, included in ITEM 1 of this Form 10-Q for additional information.

In March 2014, in the exercise of our rights as a secured creditor, we took measures to protect certain assets of CIRG, a previously unconsolidated VIE, and booked an allowance for potential non-performance of the underlying note receivable guaranteed by CIRG. See the Note, "Variable Interest Entity" in the Notes to Consolidated Financial Statements, included in ITEM 1 of this Form 10-Q for additional information.

On April 11, 2014, we amended our Credit Agreement with Wells Fargo Bank, N.A., which increased our available line of credit to $100.0 million from $75.0 million, extended the maturity by two years from August 2017 to August 2019 and provided us with a more favorable interest rate schedule and unused line fees.

On August 11, 2014, we entered into an Agreement and Plan of Merger to be acquired by subsidiaries of Tiptree Financial Inc. (NASDAQ: TIPT) for approximately $218.0 million in cash.  Tiptree is a publicly traded diversified holding company, with subsidiaries that operate in four industry segments: insurance and insurance services, specialty finance, asset management and real estate.  Following the execution of the merger agreement, stockholders representing approximately 62% of the outstanding shares of our common stock executed a written consent adopting and approving the merger agreement. No additional stockholder approvals are necessary to adopt the merger agreement or consummate the transaction. The merger agreement includes a 30-day "go-shop" period during which we are permitted to solicit and enter into negotiations with interested parties that offer alternative proposals.  Closing of the merger is subject to the satisfaction of customary conditions including, among other things, insurance regulatory approvals and expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

27

Overview of Financial Results

The Three Months Ended June 30, 2014 as compared to The Three Months Ended June 30, 2013

Our income from continuing operations before non-controlling interests for the three months ended June 30, 2014 increased $0.5 million, or 13.4%, to $3.9 million from $3.4 million for the three months ended June 30, 2013. This increase was primarily due to revenue growth, particularly in our payment protection products and auto insurance products (in prior period filings with the SEC, we referred to auto insurance products as auto products).

For the three months ended June 30, 2014, our total revenues increased $3.6 million, or 4.2%, to $88.5 million from $84.9 million for the three months ended June 30, 2013. The increase in revenues for 2014 includes organic growth of $0.7 million and $4.2 million as a result of the accounting treatment required under purchase accounting for the ProtectCELL acquisition, partially offset by $1.3 million of net realized gains on the sale of investments in 2013 that did not reoccur in 2014. The organic growth is primarily attributable to increases of $3.3 million from our payment protection products, and $1.6 million from our auto insurance products. These increases were partially offset by a $2.4 million decrease in motor club revenues, a $1.3 million decrease in organic ProtectCELL revenues, and a $0.5 million net decrease from our smaller revenue streams.

Total expenses increased $3.0 million, or 3.7%, to $82.9 million for the three months ended June 30, 2014 from $79.9 million for the same period in 2013. In the current quarter, there were decreases of $0.9 million in member benefit claims and $0.7 million in net losses and loss adjustment expenses due to lower claims in the ProtectCELL and payment protection products. Total expenses increased $4.2 million as a result of the accounting treatment required under purchase accounting for the ProtectCELL acquisition, primarily in commissions. The 2013 period also included a gain on the sale of subsidiary of $0.4 million, which reduced total expenses in that period.

Net revenues, a Non-GAAP financial measure, increased $1.4 million, or 5.2%, to $27.3 million for the three months ended June 30, 2014 compared to $25.9 million for the same period in 2013. This increase represents the organic growth in total revenues and lower member benefit claims and net losses and loss adjustment expenses, partially offset by increased commissions due to the growth in revenues, and the 2013 net realized investment gains that did not reoccur in 2014.

Earnings Before Interest, Taxes, Depreciation and Amortization ("EBITDA") from continuing operations, a Non-GAAP financial measure, increased $0.6 million, or 7.3%, to $9.1 million for the three months ended June 30, 2014 compared to $8.5 million for the same period in 2013. The EBITDA from continuing operations margin, a Non-GAAP financial measure, was 33.3% for the quarter ended June 30, 2014 compared to 32.6% for the quarter ended June 30, 2013.

Net income attributable to Fortegra Financial Corporation decreased $1.2 million, or 26.2%, to $3.3 million for the three months ended June 30, 2014 from $4.4 million for the three months ended June 30, 2013. Earnings per diluted share attributable to Fortegra Financial Corporation decreased 27.3% to $0.16 for the three months ended June 30, 2014 from $0.22 for the same period in 2013. These decreases were attributable to the results of discontinued operations for the three months ended June 30, 2013 of $1.2 million, or $0.06 per diluted share.

The Six Months Ended June 30, 2014 as compared to The Six Months Ended June 30, 2013

Our income from continuing operations before non-controlling interests for the six months ended June 30, 2014 increased $2.2 million, or 39.6%, to $7.6 million from $5.5 million for the six months ended June 30, 2013. This increase was primarily due to revenue growth, particularly in our payment protection products, ProtectCELL, and auto insurance products.

For the six months ended June 30, 2014, our total revenues increased $13.9 million, or 8.4%, to $179.1 million from $165.1 million for the six months ended June 30, 2013. The increase in revenues for 2014 includes organic growth of $5.9 million and $9.3 million as a result of the accounting treatment required under purchase accounting for the ProtectCELL acquisition, partially offset by $1.3 million of net realized gains on the sale of investments in 2013 that did not reoccur in 2014. The organic growth is primarily attributable to increases of $7.3 million from our payment protection products, $3.1 million from our auto insurance products and $2.4 million in higher service and administration fees from ProtectCELL products. These increases were partially offset by a $5.0 million decrease in motor club revenues and a $2.1 million decrease in our insurance client administrative revenues.

Total expenses increased $10.1 million, or 6.4%, to $167.7 million for the six months ended June 30, 2014 from $157.6 million for the same period in 2013. In the current year to date period, there was a decrease of $0.4 million in net losses and loss adjustment expenses due to lower claims, and a $0.4 million increase in member benefit claims due primarily to severe weather affecting motor club claims. Total expenses increased $9.3 million as a result of the accounting treatment required under purchase accounting for the ProtectCELL acquisition. This accounting treatment affected commissions by $8.9 million, partially offset by lower organic commissions of $0.4 million, and affected other operating costs by $0.4 million, offset by various cost savings including lower professional fees, reduced cost of outsourcing, and non-recurrence of 2013 costs for the direct to consumer initiative. Personnel costs decreased $0.1 million; the 2014 period reflects increased staffing costs, primarily in ProtectCELL operations, to support business objectives, while the 2013 period included $1.2 million of costs associated with the Plan. The 2014 period included a $1.3 million charge to expense associated with the allowance established against the CIRG note receivable, and the 2013 period included a $0.4 million gain on the sale of a subsidiary which reduced total expenses in that period.

28

Net revenues, a Non-GAAP financial measure, increased $5.4 million, or 10.7%, to $56.3 million for the six months ended June 30, 2014 compared to $50.8 million for the same period in 2013. This increase represents the organic revenue growth in payment protection, auto insurance, and ProtectCELL products, partially offset by lower insurance client administrative revenues and the 2013 net realized investment gains that did not reoccur in 2014.

EBITDA from continuing operations, a Non-GAAP financial measure, increased $3.8 million, or 26.3%, to $18.3 million for the six months ended June 30, 2014 compared to $14.5 million for the same period in 2013. EBITDA from continuing operations margin, a Non-GAAP financial measure, was 33.3% for the quarter ended June 30, 2014 compared to 32.6% for the quarter ended June 30, 2013.

Net income attributable to Fortegra Financial Corporation decreased $0.8 million, or 11.0%, to $6.2 million for the six months ended June 30, 2014 from $6.9 million for the six months ended June 30, 2013. Earnings per diluted share attributable to Fortegra Financial Corporation decreased 11.8% to $0.30 for the six months ended June 30, 2014 from $0.34 for the same period in 2013. These decreases were attributable to the results of discontinued operations for the six months ended June 30, 2013 of $2.5 million, or $0.12 per diluted share, partially offset by positive growth in earnings from continuing operations in the current period.

RESULTS OF OPERATIONS

The following table presents our Consolidated Statements of Income for the following periods:

	For the Three Months Ended June 30,
(in thousands, except shares, per share amounts and percentages)	2014		2013			$ Change from 2013			% Change from 2013
Revenues:
Service and administrative fees	$	42,074	$	42,040		$	34		0.1	%
Ceding commissions	11,996		6,957			5,039			72.4
Net investment income	777		746			31			4.2
Net realized investment gains	4		1,280			(1,276		)	(99.7	)
Net earned premium	33,163		33,681			(518		)	(1.5	)
Other income	510		243			267			109.9
Total revenues	88,524		84,947			3,577			4.2
Expenses:
Net losses and loss adjustment expenses	9,877		10,604			(727		)	(6.9	)
Member benefit claims	10,511		11,424			(913		)	(8.0	)
Commissions	40,842		36,986			3,856			10.4
Personnel costs	9,980		9,508			472			5.0
Other operating expenses	8,237		8,364			(127		)	(1.5	)
Depreciation and amortization	1,229		1,205			24			2.0
Amortization of intangibles	1,318		1,299			19			1.5
Interest expense	934		946			(12		)	(1.3	)
(Gain) on sale of subsidiary	—		(402		)	402			—
Total expenses	82,928		79,934			2,994			3.7
Income from continuing operations before income taxes	5,596		5,013			583			11.6
Income taxes - continuing operations	1,718		1,593			125			7.8
Income from continuing operations before non-controlling interests	3,878		3,420			458			13.4
Discontinued operations:
Income from discontinued operations - net of tax	—		1,207			(1,207		)	(100.0	)
Discontinued operations - net of tax	—		1,207			(1,207		)	(100.0	)
Net income before non-controlling interests	3,878		4,627			(749		)	(16.2	)
Less: net income attributable to non-controlling interests	602		185			417			225.4
Net income attributable to Fortegra Financial Corporation	$	3,276	$	4,442		$	(1,166	)	(26.2	)%
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.17	$	0.17
Discontinued operations - net of tax	—		0.06
Net income attributable to Fortegra Financial Corporation	$	0.17	$	0.23
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.16	$	0.16
Discontinued operations - net of tax	—		0.06
Net income attributable to Fortegra Financial Corporation	$	0.16	$	0.22
Weighted average common shares outstanding:
Basic	19,745,115		19,540,610
Diluted	20,440,133		20,523,090

29

	For the Six Months Ended June 30,
(in thousands, except shares, per share amounts and percentages)	2014		2013			$ Change from 2013			% Change from 2013
Revenues:
Service and administrative fees	$	86,042	$	80,898		$	5,144		6.4	%
Ceding commissions	22,545		14,120			8,425			59.7
Net investment income	1,484		1,649			(165		)	(10.0	)
Net realized investment gains	5		1,287			(1,282		)	(99.6	)
Net earned premium	68,091		66,823			1,268			1.9
Other income	885		334			551			165.0
Total revenues	179,052		165,111			13,941			8.4
Expenses:
Net losses and loss adjustment expenses	20,703		21,139			(436		)	(2.1	)
Member benefit claims	21,182		20,790			392			1.9
Commissions	80,913		72,348			8,565			11.8
Personnel costs	20,171		20,305			(134		)	(0.7	)
Other operating expenses	16,462		16,439			23			0.1
Depreciation and amortization	2,478		2,382			96			4.0
Amortization of intangibles	2,635		2,767			(132		)	(4.8	)
Interest expense	1,854		1,799			55			3.1
Loss on note receivable	1,317		—			1,317			100.0
(Gain) on sale of subsidiary	—		(402		)	402			100.0
Total expenses	167,715		157,567			10,148			6.4
Income from continuing operations before income taxes	11,337		7,544			3,793			50.3
Income taxes - continuing operations	3,700		2,075			1,625			78.3
Income from continuing operations before non-controlling interests	7,637		5,469			2,168			39.6
Discontinued operations:
Income from discontinued operations - net of tax	—		2,469			(2,469		)	(100.0	)
Discontinued operations - net of tax	—		2,469			(2,469		)	(100.0	)
Net income before non-controlling interests	7,637		7,938			(301		)	(3.8	)
Less: net income attributable to non-controlling interests	1,463		1,003			460			45.9
Net income attributable to Fortegra Financial Corporation	$	6,174	$	6,935		$	(761	)	(11.0	)%
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.31	$	0.23
Discontinued operations - net of tax	—		0.13
Net income attributable to Fortegra Financial Corporation	$	0.31	$	0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.30	$	0.22
Discontinued operations - net of tax	—		0.12
Net income attributable to Fortegra Financial Corporation	$	0.30	$	0.34
Weighted average common shares outstanding:
Basic	19,698,444		19,548,632
Diluted	20,463,929		20,583,951

REVENUES

Service and Administrative Fees

Service and administrative fees for the three months ended June 30, 2014 increased 0.1% to $42.1 million from $42.0 million for the three months ended June 30, 2013. The increase included $4.2 million due to the accounting treatment required under purchase accounting for the ProtectCELL acquisition, offset by decreases of $2.4 million in motor club revenues and $1.3 million in ProtectCELL revenues due mainly to competitive pressures, and a $0.5 million net decrease from our smaller revenue streams.

Service and administrative fees for the six months ended June 30, 2014 increased $5.1 million, or 6.4%, to $86.0 million from $80.9 million for the six months ended June 30, 2013. The increase included $9.3 million due to the accounting treatment required under purchase accounting for the ProtectCELL acquisition. Organic revenue growth from our ProtectCELL products of $2.4 million due to the earnings impact of robust prior year sales, and growth from auto insurance products of $1.0 million through new relationships were partially offset by decreases of $5.0 million in motor club revenues due to competitive pressures, $2.1 million in insurance client administrative revenues due to reduced service opportunities from a key client, and $0.4 million in premium finance loan administration

30

fees due to the change from loan administration to loan issuance in that product.

Ceding Commissions

Ceding commissions for the three months ended June 30, 2014 increased $5.0 million, or 72.4%, to $12.0 million from $7.0 million for the three months ended June 30, 2013. This increase primarily resulted from growth in ceded credit insurance service and administrative fees from both higher direct premium volume and increased ceding percentages on our recently amended reinsurance agreements with London Life and London International, which occurred in early 2014 and did not impact our 2013 results. In addition, underwriting profits increased due to favorable loss ratios in the ceded credit insurance business. For the three months ended June 30, 2014, ceding commissions included $8.6 million in service and administrative fees, $3.2 million in underwriting profits, and $0.1 million in net investment income.

Ceding commissions for the six months ended June 30, 2014 increased $8.4 million, or 59.7%, to $22.5 million from $14.1 million for the six months ended June 30, 2013. This increase primarily resulted from growth in ceded credit insurance service and administrative fees from both higher direct premium volume and increased ceding percentages on our recently amended reinsurance agreements with London Life and London International, which occurred early in 2014 and did not impact our 2013 results. In addition, underwriting profits increased due to favorable loss ratios in the ceded credit insurance business. For the six months ended June 30, 2014, ceding commissions included $16.2 million in service and administrative fees, $6.1 million in underwriting profits, and $0.2 million in net investment income.

Net Investment Income

Net investment income for the three months ended June 30, 2014 increased 4.2%, to $0.8 million from $0.7 million for the three months ended June 30, 2013. The increase was primarily attributable to a higher average balance of our fixed maturity securities, which was partially offset by a decrease in the overall yield of the investment portfolio.

Net investment income for the six months ended June 30, 2014 decreased $0.2 million, or 10.0%, to $1.5 million from $1.6 million for the six months ended June 30, 2013. The decrease was primarily attributable to $0.1 million of investment income attributable to ProtectCELL recorded in 2013 that was not repeated in 2014, along with a decrease in the overall yield of the investment portfolio. The decrease in the overall yield for the six months ended June 30, 2014, compared to the same period in 2013, was partially offset by an increase in the average balance of our fixed maturity securities.

Net Realized Investment Gains

Net realized gains on the sale of investments and the gross proceeds from the sales of investments were not material to our results of operations for the three and the six months ended June 30, 2014. Net realized gains on the sale of investments totaled $1.3 million for the three months ended June 30, 2013. Nearly all of the gains for the six-month period ending June 30, 2013 were attributable to investment sales occurring during the three months ended June 30, 2013.

Net Earned Premium

Net earned premium for the three months ended June 30, 2014 decreased $0.5 million, or 1.5%, to $33.2 million from $33.7 million for the three months ended June 30, 2013. This decrease resulted primarily from growth in ceded credit insurance premiums due to the recently amended reinsurance agreements with London Life and London International, which occurred early in 2014 and did not impact 2013. This change had the effect of lowering net earned premiums by the corresponding amount ceded to the reinsurers. Our direct and assumed earned premium increased $18.9 million resulting from production gains from existing and new clients distributing our credit insurance, warranty and auto insurance products, which also represented geographic expansion particularly in Texas and California. Because of this increase in production and the increased ceding percentages on our reinsurance program with London Life and London International, ceded earned premiums increased $19.4 million for the three months ended June 30, 2014. On average, we maintained a 70.1% overall cession rate of direct and assumed earned premium for the three months ended June 30, 2014 compared with 63.3% for the same period in 2013.

Net earned premium for the six months ended June 30, 2014 increased $1.3 million, or 1.9%, to $68.1 million from $66.8 million for the six months ended June 30, 2013. This increase was primarily due to growth in direct and assumed earned premium of $35.3 million resulting from increased production from existing and new clients distributing our credit insurance, warranty and auto insurance products, and from geographic expansion. Because of this increase in production and the increased ceding percentages on our reinsurance program with London Life and London International, ceded earned premiums increased $34.0 million for the six months ended June 30, 2014. On average, we maintained a 68.9% overall cession rate of direct and assumed earned premium for the six months ended June 30, 2014 compared with 63.7% for the same period in 2013.

Other Income

Other income for the three months ended June 30, 2014 increased $0.3 million, or 109.9%, to $0.5 million from $0.2 million for the three months ended June 30, 2013. The increase was principally due to $0.3 million of interest income from our premium financing program for South Bay, which began late in the fourth quarter of 2013.

31

Other income for the six months ended June 30, 2014 increased $0.6 million, or 165.0%, to $0.9 million from $0.3 million for the six months ended June 30, 2013. The increase was principally due to $0.6 million of interest income from our premium financing program for South Bay, which began late in the fourth quarter of 2013.

EXPENSES

Net Losses and Loss Adjustment Expenses

Net losses and loss adjustment expenses for the three months ended June 30, 2014 decreased $0.7 million, or 6.9%, to $9.9 million, from $10.6 million for the three months ended June 30, 2013. Our net losses and loss adjustment expense ratio improved from 31.5% in the 2013 period to 29.8% in 2014 due to lower incurred claims. The decrease in net losses and loss adjustment expenses resulted primarily from an increase in ceded credit insurance losses due to the recently amended reinsurance agreements with London Life and London International, which occurred early in 2014 and did not impact 2013. This change had the effect of lowering net losses and loss adjustment expenses by the corresponding amount ceded to the reinsurers. For the 2014 period, our direct and assumed losses increased by $4.5 million, or 20.2%, as compared with the same period in 2013. For the 2014 period, our ceded losses were higher by $5.3 million, or 44.3%, as compared with the same period in 2013, partially offsetting the increase in direct and assumed losses, which resulted predominantly from the changes in our reinsurance program with London Life and London International. The overall cession rate of direct and assumed losses and loss adjustment expenses for the three months ended June 30, 2014 increased to 63.4%, from 52.8% for the same period in 2013, with the increase primarily attributable to the change in the reinsurance program noted above.

Net losses and loss adjustment expenses for the six months ended June 30, 2014 decreased $0.4 million, or 2.1%, to $20.7 million, from $21.1 million for the six months ended June 30, 2013. Our net losses and loss adjustment expense ratio improved from 31.6% in the 2013 period to 30.4% in 2014 due to lower incurred claims. The decrease in net losses and loss adjustment expenses resulted primarily from growth in ceded credit insurance losses due to the recently amended reinsurance agreements with London Life and London International, which occurred early in 2014 and did not impact 2013. For the 2014 period, our direct and assumed losses increased by $9.6 million, or 22.1%, as compared with the same period in 2013. For the 2014 period, our ceded losses were higher by $10.1 million, or 44.9%, as compared with the same period in 2013, more than offsetting the increase in direct and assumed losses, which resulted predominantly from the changes in our reinsurance program with London Life and London International. The overall cession rate of direct and assumed losses and loss adjustment expenses for the six months ended June 30, 2014 increased to 61.0%, from 51.4% for the same period in 2013, with the increase primarily attributable to the change in the reinsurance program noted above.

Member Benefit Claims

Member benefit claims for the three months ended June 30, 2014 decreased $0.9 million, or 8.0%, to $10.5 million, from $11.4 million for the three months ended June 30, 2013. This decrease resulted principally from a $1.1 million decrease in ProtectCELL member benefits claims, which was partially offset by a $0.2 million increase in motor club member benefits claims.

Member benefit claims for the six months ended June 30, 2014 increased $0.4 million, or 1.9%, to $21.2 million, from $20.8 million for the six months ended June 30, 2013. This increase resulted principally from a $0.4 million increase in motor club member benefits claims due primarily to severe weather affecting motor club claims. ProtectCELL member claims remained consistent at $18.4 million for the six months ended June 30, 2014 and 2013, respectively.

Commissions

Commissions for the three months ended June 30, 2014 increased $3.9 million, or 10.4%, to $40.8 million from $37.0 million for the three months ended June 30, 2013. The increase included organic growth of $2.7 million from payment protection products, and $0.3 million from auto insurance products. These increases were partially offset by a decrease of $2.4 million in motor club commissions resulting from the decrease in motor club revenues and a shift in the relative mix of products sold toward those with lower commission rates. In addition, ProtectCELL commissions increased $3.3 million, of which $4.0 million was due to the accounting treatment required under purchase accounting for the ProtectCELL acquisition.

Commissions for the six months ended June 30, 2014 increased $8.6 million, or 11.8%, to $80.9 million, from $72.3 million for the six months ended June 30, 2013. The increase included organic growth of $4.3 million from payment protection products and $0.6 million from auto insurance products. These increases were partially offset by a decrease of $4.9 million in motor club commissions due to the decrease in motor club revenues and a shift in the relative mix of products sold toward those with lower commission rates. In addition, ProtectCELL commissions increased $8.7 million, of which $8.9 million was due to the accounting treatment required under purchase accounting for the ProtectCELL acquisition.

Personnel Costs

Personnel costs for the three months ended June 30, 2014 increased $0.5 million or 5.0%, to $10.0 million from $9.5 million for the three months ended June 30, 2013. For the three months ended June 30, 2014, compared to 2013, personnel costs of ProtectCELL increased $0.4 million as a result of adding staff throughout 2013 to support business objectives. Stock-based compensation expense included in personnel costs totaled $0.2 million for the three months ended June 30, 2014 and 2013, respectively.

Personnel costs for the six months ended June 30, 2014 decreased $0.1 million, or 0.7%, to $20.2 million from $20.3 million for the

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six months ended June 30, 2013. The 2014 period reflects increased staffing costs, primarily in ProtectCELL operations, to support business objectives, while the 2013 period included $1.2 million of costs associated with the Plan. Our personnel levels remained consistent, as we employed 477 people at June 30, 2014 compared to 476 at June 30, 2013. Stock-based compensation expense included in personnel costs decreased to $0.3 million for the six months ended June 30, 2014 from $0.4 million for the same period in 2013.

Other Operating Expenses

Other operating expenses for the three months ended June 30, 2014 decreased 1.5% to $8.2 million, from $8.4 million for the three months ended June 30, 2013. Other operating expenses for the six months ended June 30, 2014 increased 0.1%, to $16.5 million, from $16.4 million for the six months ended June 30, 2013. Other operating expenses for both periods in 2014 were relatively consistent with the 2013 periods, even though net revenues, a Non-GAAP financial measure, for the three and the six months ended June 30, 2014 increased 5.2% and 10.7%%, respectively.

Depreciation and Amortization

Depreciation and amortization expense for the three months ended June 30, 2014 and 2013 remained consistent at $1.2 million, respectively. Depreciation and amortization expense for the six months ended June 30, 2014 increased $0.1 million, or 4.0%, to $2.5 million from $2.4 million for the six months ended June 30, 2013, due to higher levels of depreciable and amortizable assets in service during 2014 compared to the same period in 2013.

Amortization of Intangibles

Amortization expense on intangibles for the three months ended June 30, 2014 and 2013, remained consistent at $1.3 million, respectively. Amortization expense on intangibles for the six months ended June 30, 2014 decreased $0.2 million to $2.6 million from $2.8 million for the six months ended June 30, 2013 as more amortizable intangible assets became fully amortized during 2014.

Interest Expense

Interest expense for the three months ended June 30, 2014 and 2013, remained consistent at $0.9 million, respectively. Interest expense for the six months ended June 30, 2014 increased $0.1 million, or 3.1%, to $1.9 million from $1.8 million for the six months ended June 30, 2013, with the increase attributable to the additional interest expense incurred on borrowings under our line of credit with Synovus Bank, which supports our premium receivable product offering at South Bay.

Loss on Note Receivable

For the six months ended June 30, 2014, we recorded a $1.3 million loss resulting from establishing the allowance against the CIRG note receivable, which we entered into in connection with the sale of CIRG in July of 2011.

Income Taxes

Income taxes for the three months ended June 30, 2014 increased $0.1 million, or 7.8%, to $1.7 million from $1.6 million for the three months ended June 30, 2013, with the increase primarily attributable to a higher level of pretax income, partially offset by slightly more favorable tax preference items for the 2014 period compared to the same period in 2013. These factors caused our effective tax rate to be 30.7% for the three months ended June 30, 2014 compared to 31.8% for the same period in 2013.

Income taxes for the six months ended June 30, 2014 increased $1.6 million, or 78.3%, to $3.7 million from $2.1 million for the six months ended June 30, 2013, with the increase primarily attributable to a higher level of pretax income and a lower level of tax preference items in 2014 compared to 2013. These factors caused our effective tax rate to be 32.6% for the six months ended June 30, 2014 compared to 27.5% for the same period in 2013. See the Note, "Income Taxes" in the Notes to Consolidated Financial Statements, included in ITEM 1 of this Form 10-Q for additional information and a reconciliation of the items impacting our income taxes and our effective tax rate.

Divestitures - Discontinued Operations

On December 31, 2013, we completed the sale of all of the issued and outstanding stock of our subsidiaries, Bliss and Glennon and eReinsure.com, to AmWINS, pursuant to the terms of the Purchase Agreement. As consideration for the Disposition, we received net cash proceeds of $81.8 million, representing gross proceeds of $83.5 million less $1.0 million in transaction fees paid at the time of closing and $0.7 million of cash held by the disposed entities. We utilized the cash proceeds received on December 31, 2013 to pay off our existing credit facility with Wells Fargo Bank, N.A. Due to the Disposition, we no longer operate in the businesses of wholesale insurance brokerage and selling or licensing of a computerized system or platform for the negotiation and/or placement of facultative reinsurance. See the Notes, "Summary of Significant Accounting Policies - Discontinued Operations" and "Divestitures" in the Notes to Consolidated Financial Statements, included in ITEM 1 of this Form 10-Q for additional information.

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The following table presents the amounts related to discontinued operations in our Consolidated Statements of Income:

(in thousands)	For the Three Months Ended		For the Six Months Ended
	June 30, 2013		June 30, 2013
Income from discontinued operations:
Revenues:
Brokerage commissions and fees	$	9,891	$	19,622
Net investment income	6		12
Other income	16		16
Total revenues	9,913		19,650
Expenses:
Personnel costs	5,086		10,135
Other operating expenses	1,546		2,888
Depreciation and amortization	162		303
Amortization of intangibles	481		961
Interest expense	598		1,189
Total expenses	7,873		15,476
Income from discontinued operations before income taxes	2,040		4,174
Income taxes - discontinued operations	833		1,705
Discontinued operations - net of tax	$	1,207	$	2,469

USE OF NON-GAAP FINANCIAL INFORMATION

We present certain financial measures related to our business that are "Non-GAAP financial measures" within the meaning of Item 10 of Regulation S-K in this Form 10-Q. We present these Non-GAAP financial measures to provide investors with additional information to analyze our performance from period to period.  Management also uses these measures to assess performance and to allocate resources in managing our businesses.  However, investors should not consider these Non-GAAP financial measures as a substitute for the financial information that we report in accordance with U.S. GAAP.  These Non-GAAP financial measures reflect subjective determinations by management, and may differ from similarly titled Non-GAAP financial measures presented by other companies.

In this Form 10-Q, we present Net revenues, Operating expenses, EBITDA from continuing operations and Adjusted EBITDA from continuing operations. These financial measures are Non-GAAP financial measures and are not recognized terms under U.S. GAAP and should not be used as an indicator of, and are not an alternative to, net income as a measure of operating performance. Net revenues are total revenues less net losses and loss adjustment expenses, member benefit claims, and commission expenses. Operating expenses are the sum of personnel costs and other operating expenses. EBITDA from continuing operations is net income before interest expense, income taxes, net income attributable to non-controlling interests, depreciation and amortization. Adjusted EBITDA from continuing operations means "Consolidated Adjusted EBITDA" which is defined under our credit facility with Wells Fargo Bank, N.A., which in general terms means consolidated net income from continuing operations before non-controlling interests, consolidated interest expense, consolidated amortization expense, consolidated depreciation expense and consolidated income tax expense, relating to continuing operations. The other items excluded in this calculation may include if applicable, but are not limited to, specified acquisition costs, impairment of goodwill and other non-cash charges, stock-based compensation expense, and unusual or non-recurring charges and items that affect comparability of results. The calculations below do not give effect to certain additional adjustments permitted under our credit facility, which if included, would increase the amount of Adjusted EBITDA from continuing operations reflected in the table. We believe presenting EBITDA from continuing operations and Adjusted EBITDA from continuing operations provides investors with supplemental financial measures of our operating performance.

In addition to the financial covenant requirements under our credit facility, management uses Net revenues, Operating expenses, EBITDA from continuing operations and Adjusted EBITDA from continuing operations as financial measures of operating performance for planning purposes, which may include, but are not limited to, the preparation of budgets and projections, the determination of bonus compensation for executive officers, the analysis of the allocation of resources and the evaluation of the effectiveness of business strategies. We use Net revenues as another means of understanding product contributions to our results. We use Operating expenses to reconcile from Net revenues to EBITDA. Although we use EBITDA from continuing operations and Adjusted EBITDA from continuing operations as financial measures to assess the operating performance of our business, both measures have significant limitations as analytical tools because they exclude certain material expenses. For example, they do not include interest expense and the payment of income taxes, which are both a necessary element of our costs and operations. Since we use property and equipment to generate service revenues, depreciation expense is a necessary element of our costs. In addition, the omission of amortization expense associated with our intangible assets further limits the usefulness of these financial measures. Management believes the inclusion of the adjustments to EBITDA from continuing operations and Adjusted EBITDA from continuing operations are appropriate to provide additional information to investors about certain material non-cash items and about unusual items that we do not expect to continue at the same level in the future. Because EBITDA from continuing operations and Adjusted EBITDA from continuing operations do not

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account for these expenses, its utility as a financial measure of our operating performance has material limitations. Due to these limitations, management does not view EBITDA from continuing operations and Adjusted EBITDA from continuing operations in isolation or as primary financial performance measures.

We believe EBITDA and Adjusted EBITDA are frequently used by securities analysts, investors and other interested parties in the evaluation of similar companies in similar industries and to measure a company's ability to service its debt and other cash needs. Because the definitions of EBITDA and Adjusted EBITDA (or similar financial measures) may vary among companies and industries, they may not be comparable to other similarly titled financial measures used by other companies.

The following table presents a reconciliation of the components of net revenues for the following periods:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total revenues	$	88,524	$	84,947	$	179,052	$	165,111
Less :
Net losses and loss adjustment expenses	9,877		10,604		20,703		21,139
Member benefit claims	10,511		11,424		21,182		20,790
Commissions	40,842		36,986		80,913		72,348
Net revenues	$	27,294	$	25,933	$	56,254	$	50,834

The following table presents a reconciliation of the components of operating expenses for the following periods:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Personnel costs	$	9,980	$	9,508	$	20,171	$	20,305
Other operating expenses	8,237		8,364		16,462		16,439
Operating expenses	$	18,217	$	17,872	$	36,633	$	36,744

The following table presents a reconciliation of income from continuing operations before non-controlling interests to EBITDA from continuing operations and Adjusted EBITDA from continuing operations for the following periods:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
(in thousands)	2014			2013			2014			2013
Income from continuing operations before non-controlling interests	$	3,878		$	3,420		$	7,637		$	5,469
Depreciation	1,229			1,205			2,478			2,382
Amortization of intangibles	1,318			1,299			2,635			2,767
Interest expense	934			946			1,854			1,799
Income taxes	1,718			1,593			3,700			2,075
EBITDA from continuing operations	9,077			8,463			18,304			14,492
Transaction costs (1)	18			55			28			141
Restructuring expenses	—			80			—			1,234
(Gain) on sale of subsidiary	—			(402		)	—			(402		)
Legal expenses	—			243			—			243
Stock-based compensation expense	291			328			581			632
Loss on note receivable	—			—			1,317			—
Adjusted EBITDA from continuing operations	$	9,386		$	8,767		$	20,230		$	16,340
EBITDA from continuing operations margin (2)	33.3		%	32.6		%	32.5		%	28.5		%
Adjusted EBITDA from continuing operations margin (3)	34.4		%	33.8		%	36.0		%	32.1		%
(1) Represents transaction costs associated with completed and/or potential acquisitions.
(2) EBITDA from continuing operations margin is calculated by dividing EBITDA from continuing operations by Net Revenues.
(3) Adjusted EBITDA from continuing operations margin is calculated by dividing Adjusted EBITDA from continuing operations by Net Revenues.

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LIQUIDITY AND CAPITAL RESOURCES

Liquidity

Liquidity describes the ability of a company to generate adequate cash flows to meet the cash requirements of its business operations, including working capital needs, capital expenditures, debt service, acquisitions and other commitments and contractual obligations. We historically have derived our liquidity primarily from our invested assets, cash flows from operations, ordinary and extraordinary dividend capacity from our subsidiary insurance companies and our credit facilities. When considering our liquidity, it is important to note that our restricted cash is held in a fiduciary capacity and is available only to satisfy certain future cash payment obligations that are recorded as liabilities.

Our primary cash requirements include the payment of operating expenses, interest and principal payments on debt, capital expenditures and acquisitions. We may also incur unexpected costs and operating expenses related to any unforeseen disruptions to our facilities and equipment, the loss of key personnel or changes in the credit markets and interest rates, which could increase our immediate cash requirements or otherwise impact our liquidity.

Our primary sources of liquidity include our total investments, cash and cash equivalent balances, and availability under our revolving credit facilities. At June 30, 2014, we had total available-for-sale and short-term investments of $152.6 million (which included restricted investments of $16.0 million), cash and cash equivalents of $10.7 million and $97.0 million of available capacity on our credit facilities. At December 31, 2013, we had total investments of $138.8 million (which included restricted investments of $16.5 million), cash and cash equivalents of $21.7 million and $75.1 million of available capacity on our credit facilities. Our total indebtedness, including notes payable and preferred trust securities, was $46.0 million at June 30, 2014 compared to $38.3 million at December 31, 2013.

We believe that our cash flows from operations and the availability under our credit facilities, combined with our low capital expenditure requirements, will provide us with adequate capital to continue to grow our business over the next several years, although we cannot give any assurances. We intend to use a portion of our available cash flows to pay interest on our outstanding debt, thus limiting the amount available for working capital, capital expenditures and other general corporate purposes. If we continue to expand our business and make acquisitions, we may in the future require additional working capital to meet our future business needs. This additional working capital may be in the form of additional debt or equity. Although we believe we have adequate liquidity under our credit facilities, as discussed above, under adverse market conditions or in the event of a default under our credit facilities, there can be no assurance that such funds would be available or adequate, and, in such a case, we may not be able to successfully obtain additional financing on favorable terms, or at all, or replace our existing credit facilities upon their respective maturity dates.

Cash Exceeding Federal Deposit Insurance Corporation ("FDIC") Limits

We maintain cash and cash equivalents with major third party financial institutions, including interest-bearing money market accounts, which are insured by the FDIC's standard insurance limit of $250,000 per depositor per institution. Our accounts containing cash and cash equivalents may exceed the FDIC's standard insurance limit from time to time.

Our cash balances, including restricted cash, exceeding the FDIC standard insurance limit totaled $9.0 million at June 30, 2014 and $18.9 million at December 31, 2013. To date, we have not experienced any loss of, or lack of access to, our cash and cash equivalents or our restricted cash. Although we periodically monitor and adjust the balances of these accounts as needed, the balances of these accounts nonetheless remain subject to unexpected, adverse conditions in the financial markets and could be adversely impacted if a financial institution with which we maintain an account fails. We will continue to monitor our accounts held at depository institutions.

We can give no assurances that we will not lose deposited funds exceeding the FDIC standard insurance limit or access to these funds due to adverse conditions in the financial markets or if a financial institution with which we maintain an account fails.

Share Repurchase Plan

We have a share repurchase plan that allows us to purchase up to $15.0 million in total of our common stock from time to time through open market or private transactions. We did not repurchase any of our common stock during the three or the six months ended June 30, 2014. For the three months and six months ended June 30, 2013, respectively, we repurchased 200,000 shares of outstanding common stock at an average price of $6.79 per share at a total cost of $1.4 million. At June 30, 2014, we had $7.2 million still available for repurchase under the plan. See PART II, ITEM 2 included in this Form 10-Q, for more information on our share repurchase plan.

Regulatory Requirements

Dividends Limitations

We are a holding company and have limited direct operations. Our holding company assets consist primarily of the capital stock of our subsidiaries. Accordingly, our future cash flows depend upon the availability of dividends and other payments from our subsidiaries, including statutorily permissible payments from our insurance company subsidiaries, as well as payments under our tax allocation agreement and management agreements with our subsidiaries.

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The following table sets forth the dividends paid to us by our insurance company subsidiaries during the following periods:

	For the Six Months Ended		For the Twelve Months Ended
(in thousands)	June 30, 2014		December 31, 2013
Ordinary dividends	$	—	$	2,383
Extraordinary dividends	—		—
Total dividends	$	—	$	2,383

Please see the Note, "Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions" in the Notes to Consolidated Financial Statements included in ITEM 1 of this Form 10-Q, for additional information.

$100.0 million Secured Credit Agreement - Wells Fargo Bank, N.A.

In April 2014, we amended the original credit agreement, entered into on August 2, 2012, (as amended, the "Credit Agreement"), with a syndicate of lenders, among them Wells Fargo Bank, N.A., who also serves as administrative agent ("Wells Fargo" or the "Administrative Agent"). The Credit Agreement matures on August 2, 2019 (subject to earlier termination) and has a revolving credit facility limit of $100.0 million (the "Revolving Facility") with a sub-limit of $10.0 million for swingline loans and $10.0 million for letters of credit. The Credit Agreement includes a provision pursuant to which, from time to time, we may request that the lenders in their discretion increase the maximum amount of commitments under the Credit Agreement by an amount not to exceed $50.0 million. The Credit Agreement also contains financial covenants, which we must maintain. The amendment to the Credit Agreement reduced the interest rate margin on revolving loans by 0.35% for each pricing level and reduced the unused line fee paid on undrawn revolving commitments by 0.05% for each pricing level.

As of June 30, 2014, we were in compliance with the financial covenants contained in the Credit Agreement. Please see the Note, "Notes Payable" in the Notes to Consolidated Financial Statements included in ITEM 1 of this Form 10-Q, for additional information on the Credit Agreement.

$15.0 million Revolving Line of Credit - Synovus Bank

At June 30, 2014, South Bay had a $15.0 million line of credit agreement (the "Line of Credit") with Synovus Bank, entered into on October 2013, with a maturity date of April 2017. The Line of Credit bears interest at a rate of 300 basis points plus the 90-day LIBOR, and is available specifically for the South Bay premium financing product. The Line of Credit allows South Bay to finance up to 90% of the eligible receivables, less an applicable reserve of $500,000. At June 30, 2014, the balance of premium financing receivables included in notes receivable, net on the Consolidated Balance Sheet, totaled $11.7 million, of which $9.4 million were eligible receivables, and the balance of the Line of Credit included in notes payable on the Consolidated Balance Sheet was $8.0 million. At June 30, 2014, South Bay was in compliance with the covenants required by the Line of Credit.

Preferred Trust Securities

In connection with the Summit Partners Transactions, our subsidiary LOTS Intermediate Co. issued $35.0 million of fixed/floating rate preferred trust securities due in 2037. The preferred trust securities accrued interest at a rate of 9.61% per annum until the June 2012 interest payment date; thereafter, interest accrues at a rate of 3-month LIBOR plus 4.10% for each interest rate period. Interest due on the preferred trust securities is payable quarterly. We may redeem the preferred trust securities, completely or in part, at a price equal to 100% of the principal amount of such preferred trust securities outstanding plus accrued and unpaid interest.

Interest Rate Swap

At June 30, 2014, we have a single interest rate swap (the "Swap") designated as a cash flow hedge with Wells Fargo Bank, N.A. This instrument swapped the floating rate portion of our $35.0 million in outstanding preferred trust securities to a fixed rate of 3.47% per annum payable quarterly resulting in a total rate of 7.57% after adding the applicable margin of 4.10%. The Swap has a five year term, which commenced in June 2012 when the interest rate on the underlying preferred trust securities began to float, and will expire in June 2017. Please see the Note, "Derivative Financial Instruments - Interest Rate Swap" in the Notes to Consolidated Financial Statements included in ITEM 1 of this Form 10-Q, for additional information.

Invested Assets

Our invested assets consist mainly of high quality investments in fixed maturity securities, short-term investments, and a smaller allocation of common and preferred equity securities. We believe that prudent levels of investments in equity securities within our investment portfolio are likely to enhance long-term after-tax total returns without significantly increasing the risk profile of the portfolio. We regularly review our entire portfolio in the context of macroeconomic and capital market conditions. The overall credit quality of the investment portfolio was rated AA- by Standard and Poor's Rating Service at June 30, 2014 and December 31, 2013, respectively.

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Regulatory Requirements

The investments we make must comply with the applicable laws and regulations for our industry, which prescribe the kind, quality and concentration of permissible investments. In general, these laws and regulations permit investments, within specified limits and subject to certain qualifications, in federal, state and municipal obligations, corporate bonds, preferred and common equity securities, mortgage loans, real estate and other investments.

Investment Strategy

The board of directors, for each of our insurance company subsidiaries, regularly reviews and approves the applicable investment policy in order to monitor and consider various investment activities and tactics as well as new investment opportunities. Our investment strategy seeks long-term returns through disciplined security selection, portfolio diversity and an integrated approach to risk management. We select and monitor investments to balance the goals of safety, stability, liquidity, growth and after-tax total return with the need to comply with regulatory investment requirements. A third-party provider of asset management services manages our investment portfolio. We employ asset/liability management strategies to reduce the adverse effects of interest rate volatility and to increase the likelihood that cash flows are available to pay claims as they become due. Asset/liability management is accomplished by setting an asset target duration range that is influenced by the following factors: (i) the estimated reserve payout pattern, (ii) the inclusion of our tactical capital market views into the investment decision-making process and (iii) our overall risk tolerance. We aim to achieve a relatively safe and stable income stream by maintaining a broad-based portfolio of investment grade fixed maturity securities. We may also make investments in additional asset types with the objective of further enhancing the portfolio's diversification and expected returns. These additional asset types include common and redeemable preferred stock. We manage our investment risks through consideration of duration of liabilities, diversification, credit limits, careful analytic review of each investment decision, and comprehensive risk assessments of the overall portfolio.

At June 30, 2014, we held 87 individual fixed maturity and 10 individual equity securities in unrealized loss positions. At June 30, 2013, we held 103 individual fixed maturity and 10 individual equity securities in unrealized loss positions. The decrease in the number of fixed maturity securities in unrealized loss positions was primarily due to changes in bond yields and the related impact on market prices. We do not intend to sell the investments that were in an unrealized loss position at June 30, 2014 and believe that it is more likely than not that we will be able to hold these securities until full recovery of their amortized cost basis for fixed maturity securities or cost for equity securities, although we can give no assurances.

Based on management's quarterly review, none of our fixed maturity or equity securities were deemed other than temporarily impaired during the periods ended June 30, 2014 and June 30, 2013, respectively. Please see the Note, "Investments" in the Notes to Consolidated Financial Statements included in this Form 10-Q, for additional information.

Cash Flows

We monitor cash flows at the consolidated, holding company, and subsidiary levels on a monthly basis, using trend and variance analysis to project future cash needs, with adjustments made as needed. The following table presents our consolidated cash flows:

(in thousands)	For the Six Months Ended June 30,
Cash provided by (used in):	2014			2013
Operating activities	$	(1,847	)	$	15,965
Investing activities	(15,616		)	(11,835		)
Financing activities	6,439			(3,749		)
Net change in cash and cash equivalents	$	(11,024	)	$	381

Our Consolidated Statement of Cash Flows for the six months ended June 30, 2013 includes the cash flows from Bliss and Glennon and eReinsure. Our Consolidated Balance Sheet as of December 31, 2013 reflects Bliss and Glennon and eReinsure as discontinued operations.

Operating Activities

Net cash used in operating activities was $1.8 million for the six months ended June 30, 2014 compared to net cash provided by operating activities of $16.0 million for the six months ended June 30, 2013. In the current period, lower sales volumes of ProtectCELL products, motor club products, and insurance client administrative services resulted in lower cash collections. We also used cash during the six months ended June 30, 2014 to extinguish $7.4 million of liabilities of discontinued operations, and to pay premium taxes and other liabilities and accrued expenses.

Investing Activities

Net cash used in investing activities was $15.6 million for the six months ended June 30, 2014 compared to $11.8 million for the six months ended June 30, 2013. The increase in net cash used in investing activities was primarily attributable to issuance of additional notes receivable, net of collections, under the South Bay premium financing program, which started late in the fourth quarter of 2013 and the cash proceeds received in the prior year period for the payoff of the $6.1 million related party note receivable, which was not

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repeated in 2014. Partially offsetting this increase was a lower level of net cash used in 2014 for net investment portfolio activity and acquisitions and divestitures compared to the same period in 2013.

Financing Activities

Net cash provided by financing activities was $6.4 million for the six months ended June 30, 2014 compared to net cash used in financing activities of $3.7 million for the six months ended June 30, 2013. The increase in 2014 primarily reflected a greater change in the utilization of our credit facilities compared to the 2013 period, which was principally due to the usage of our Line of Credit for the South Bay premium financing program. In addition, during 2014 we did not use cash to repurchase common stock under our stock repurchase plan, while in 2013 we used $1.4 million to repurchase 200,000 shares of our common stock.

Contractual Obligations and Other Commitments

We have obligations and commitments to third parties as a result of our operations. Our contractual obligations and commitments, as of June 30, 2014, have not changed materially from those disclosed in our 2013 Form 10-K. For a discussion of our contractual obligations and other commitments, please see PART II, ITEM 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations," contained in our 2013 Form 10-K.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that are reasonably likely to have a material current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Our markets risks, as of June 30, 2014, have not changed materially from those disclosed in our 2013 Form 10-K. For a discussion of our exposure to market risk, please see PART II, ITEM 7A. "Quantitative and Qualitative Disclosures about Market Risk," contained our 2013 Form 10-K.

ITEM 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

Under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, we have evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), as of June 30, 2014. Based on this evaluation, management, including our Chief Executive Officer and Chief Financial Officer, concluded that our disclosure controls and procedures were effective as of June 30, 2014.

Changes in Internal Control Over Financial Reporting

Management, including our Chief Executive Officer and Chief Financial Officer, identified no change in our internal control over financial reporting that occurred during the quarter ended June 30, 2014, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Inherent Limitations of Disclosure Controls and Procedures and Internal Control Over Financial Reporting

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that our disclosure controls and internal controls will prevent or detect all errors and all fraud. 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. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within Fortegra have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple errors or mistakes. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by our management override of the controls. The design of any system of controls also is based in part upon certain assumptions about the likelihood of future events. There can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Over time, a control may become inadequate because of changes in conditions or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

Chief Executive Officer and Chief Financial Officer Certifications

Exhibits 31.1 and 31.2 are the Certifications of our Chief Executive Officer and Chief Financial Officer, respectively, required in accordance with Section 302 of the Sarbanes-Oxley Act of 2002 (the "Section 302 Certifications"). The "Evaluation of Disclosure Controls and Procedures" in this ITEM 4 is the "Evaluation" referred to in the Section 302 Certifications, and accordingly, the above information should be read in conjunction with the Section 302 Certifications for a more complete understanding of the topics presented.

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PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The information set forth in the "Contingencies" section of the Note, "Commitments and Contingencies" of the Notes to Consolidated Financial Statements in ITEM 1 of this Form 10-Q is incorporated herein by reference.

ITEM 1A. RISK FACTORS

The following are certain risks that management believes are specific to our business. Readers should not view these risk factors as an all-inclusive list of risks that may affect our business or as a presentation of the risk factors in any particular order. You should carefully consider the risks described below, together with the other information contained in this Form 10-Q and in our other filings with the SEC when evaluating our Company. The occurrence of any of the events discussed in these risk factors could materially affect our business, financial condition, results of operations and cash flows. Additional risks unknown at this time, or risks we currently deem immaterial, may also affect our business, financial condition, results of operations and cash flows.

Risks Related to our Business and Industries

General economic and financial market conditions may have a material adverse effect on the business, results of operations, cash flows and financial condition of our business.

General economic and financial market conditions, including the availability and cost of credit, the loss of consumer confidence, reduction in consumer or business spending, inflation, unemployment, energy costs and geopolitical issues, have contributed to increased uncertainty and volatility as well as diminished expectations for the U.S. economy and the financial markets. These conditions could have a material and adverse affect on our business. Adverse economic and financial market conditions could result in:

• a reduction in the demand for, and availability of, consumer credit, which could result in reduced demand by consumers for our products and our clients opting to no longer make such products available;

• higher than anticipated loss ratios on our products due to rising unemployment or disability claims;

• higher risk of increased fraudulent claims;

• individuals terminating loans or canceling credit insurance policies, thereby reducing our revenues;

• a reduction in the demand for consumer warranty service contracts, service contract offerings, mobile device protection and motor club memberships;

• individuals terminating warranty service contracts, service contracts, mobile device protection contracts or motor club memberships, thereby reducing our revenues;

• our clients being more likely to experience financial distress or declare bankruptcy or liquidation, which could have an adverse impact on demand for our services and products and the remittance of premiums from such customers, as well as the collection of receivables from such clients for items such as unearned premiums, commissions or related accounts receivable, which could make the collection of receivables from our clients more difficult;

• increased pricing sensitivity or reduced demand for our services and products;

• increased costs associated with, or the inability to obtain, debt financing to fund acquisitions or the expansion of our business; and

• defaults in our fixed income investment portfolio or lower than anticipated rates of return as a result of low interest rate environments.

If we cannot successfully anticipate changing economic or financial market conditions, we may be unable to effectively plan for or respond to such changes, and our business, results of operations, financial condition and cash flows could be materially and adversely affected.

We face significant competitive pressures in our business, which could have a material and adverse effect on our business, results of operations, financial condition and cash flows.

We face various competitive factors in our business. These competitive factors may include price, industry knowledge, quality of client service, our ability to efficiently administer claims, the effectiveness of our sales force, technology platforms and processes, the security and integrity of our information systems, the financial strength ratings of our insurance company subsidiaries, office locations, breadth of services and products, brand recognition and reputation. Some competitors may offer a broader array of services and products, may have a greater diversity of distribution resources, may have better brand recognition, may have lower cost structures or, with respect to insurers, may have higher financial strength or claims paying ratings. Some competitors also have larger client bases than we do. In addition, new competitors could enter our markets in the future, and existing competitors may gain strength by forging new business relationships.

We compete with insurance companies, financial institutions, extended service plan providers, membership plan providers, wireless carriers and other insurance and warranty service providers. Our principal competitors include The Warranty Group, American National

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Insurance Company, Assurant, Inc., Asurion Corporation, eSecuritel Holdings, LLC, Global Warranty Group, LLC, Securian Financial Group, The Plateau Group, Inc. and smaller regional companies. Due to state and federal regulatory developments and changes in prior years, certain financial institutions are able to offer debt cancellation plans and can affiliate with other insurance companies in order to offer services similar to ours. This has resulted in new competitors, some of whom have significant financial resources, entering some of our markets. As competitors gain experience with payment protection and warranty programs, their reliance on our services and products may diminish.

We expect competition to intensify, which may result in lower prices and volumes, higher personnel and sales and marketing costs, increased technology expenditures and lower profitability. We may not be able to supply clients with services or products that they deem superior and at competitive prices and we may lose business to our competitors. If we cannot compete effectively, it would have a material adverse effect on our business, results of operations, financial condition and cash flows.

Our results of operations may fluctuate significantly, which makes our future results of operations difficult to predict. If our results of operations fall below expectations, the price of our common stock could decline.

Our annual and quarterly results of operations have fluctuated in the past and may fluctuate significantly in the future due to a variety of factors, many of which are beyond our control. In addition, our expenses as a percentage of revenues may be significantly different from our historical rates. As a result, comparing our results of operations on a period-to-period basis may not be meaningful. Factors that may cause our results of operations to fluctuate from period-to-period include:

• demand for our services and products;

• the length of our sales cycle;

• the amount of sales to new clients;

• the timing of implementations of our services and products with new clients;

• seasonality;

• the timing of acquisitions;

• competitive factors;

• prevailing interest rates;

• pricing changes by us or our competitors;

• transaction volumes in our clients' businesses;

• the introduction of new services and products by us and our competitors;

• changes in strategic partnerships;

• changes in regulatory and accounting standards; and

• our ability to control costs.

In addition, our revenues may vary depending on the level of consumer activity and the success of our clients in selling products.

Our results of operations could be materially and adversely affected if we fail to retain our existing clients, cannot sell additional services and products to our existing clients, do not introduce new or enhanced services and products or are not able to attract and retain new clients.

Our revenue and revenue growth are dependent on our ability to retain clients, to sell those clients additional services and products, to introduce new services and products and to attract new clients. Our ability to increase revenues will depend on a variety of factors, including:

• the quality and perceived value of our product and service offerings by existing and prospective clients;

• the effectiveness of our sales and marketing efforts;

• the successful installation and implementation of our services and products for new and existing clients;

• availability of capital to complete investments in new or complementary products, services and technologies;

• the availability of adequate reinsurance for us and our clients, including the ability of our clients to form, capitalize and operate captive reinsurance companies;

• our ability to find suitable acquisition candidates, successfully complete such acquisitions and effectively integrate such acquisitions;

• our ability to integrate technology into our services and products to avoid obsolescence and provide scalability;

• the reliability, execution and accuracy of our services; and

• client willingness to accept any price increases for our services and products.

In addition, we are subject to risks of losing clients due to consolidation in the markets we serve. Our inability to retain existing clients, sell additional services and products, or successfully develop and implement new and enhanced services and products and attract new clients, and accordingly, increase our revenues, could have a material adverse effect on our results of operations.

We typically face a long selling cycle to secure new clients as well as long implementation periods that require significant resource commitments, which may result in long lead-times before we receive revenues from new client relationships.

The industries in which we compete generally consist of mature businesses and markets and the companies that participate in these industries have well-established business operations, systems and relationships. Accordingly, our business typically faces a long selling

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cycle to secure a new client. Even if we are successful in obtaining a new client engagement, a long implementation period may follow in which we plan the services in detail and demonstrate to the client that we can successfully integrate our processes and resources with their operations. We also typically negotiate and enter into a contractual relationship with the new client during this period. There is then a long implementation period in order to commence providing the services.

We typically incur significant business development expenses during the selling cycle. We may not succeed in winning a new client's business, in which case we receive no revenues and may receive no reimbursement for such expenses. Even if we succeed in developing a relationship with a potential client and begin to plan the services in detail, such potential client may choose a competitor or decide to retain the work in-house prior to the time a final contract is signed. If we enter into a contract with a client, we will typically receive no revenues until implementation actually begins. In addition, a significant portion of our revenue depends upon the success of our clients' marketing programs, which may not generate the transaction volume we anticipate. Our clients may also experience delays in obtaining internal approvals or delays associated with technology or system implementations, thereby further lengthening the implementation cycle. If we are not successful in obtaining contractual commitments after the selling cycle, in maintaining contractual commitments after the implementation cycle or in maintaining or reducing the duration of unprofitable initial periods in our contracts, it may have a material adverse effect on our business, results of operations and financial condition. Furthermore, the time and effort required to complete the implementation phases of new contracts makes it difficult to predict with accuracy the timing of revenues from new clients as well as our costs.

Acquisitions are a significant part of our growth strategy and we may not be successful in identifying suitable acquisition candidates, completing such acquisitions or integrating the acquired businesses, which could have a material adverse effect on our business, results of operations, financial condition and growth.

Historically, acquisitions have played a significant role in our expansion into new markets and in the growth of some of our operations. Acquiring complementary businesses is a significant component of our growth strategy. Accordingly, we frequently evaluate possible acquisition targets for our business. However, we may not be able to identify suitable acquisition targets, and we may not be able to finance and complete such transactions on acceptable terms. We may incur significant expenses in evaluating and completing such acquisitions. Furthermore, any future acquisitions may not be successful. In addition, we may be competing with larger competitors with substantially greater resources for acquisition targets. Any deficiencies in the process of integrating companies we may acquire could have a material adverse effect on our results of operations and financial condition. Acquisitions entail a number of risks including, among other things:

• failure to achieve anticipated revenues, earnings or cash flows;

• increased expenses;

• diversion of management time and attention;

• failure to retain the acquired business' customers or personnel;

• difficulties in realizing projected efficiencies;

• ability to realize synergies and cost savings;

• difficulties in integrating systems and personnel; and

• inaccurate assessment of liabilities.

Our failure to address these acquisition risks adequately, could have a material adverse effect on our business, results of operations, financial condition and growth. Future acquisitions may reduce our cash resources available to fund our operations and capital expenditures and could result in increased amortization expense related to any intangible assets acquired, potentially dilutive issuances of equity securities or the incurrence of debt, which could increase our interest expense.

We may lose clients or business due to consolidation within the financial services industry.

There has been considerable consolidation in the financial services industry, driven primarily by the acquisition of small and mid-size organizations by larger entities. We expect this trend to continue. We may lose business or suffer decreased revenues if one or more of our significant clients or distributors consolidate or align themselves with other companies. To date, consolidation has not materially affected our business. However, future industry consolidation could affect our business, particularly if organizations that already possess the operations, services and products that we provide acquire any of our significant clients.

Our ability to implement and execute our strategic plans may not be successful and, accordingly, we may not be successful in achieving our strategic goals, which may have a material and adverse effect on our business.

We may not be successful in developing and implementing our strategic plans for our business or the operational plans that have been or need to be developed to implement these strategic plans. If the development or implementation of such plans is not successful, we may not produce the revenue, margins, earnings or synergies that we need to be successful. We may also face delays or difficulties in implementing service, product, process and system improvements, which could adversely affect the timing or effectiveness of margin improvement efforts in our business and our ability to compete successfully in the markets we serve. The execution of our strategic and operating plans, to some extent, will also be dependent on external factors that we cannot control. In addition, these strategic and operational plans need continual assessment and reassessment to meet the challenges and needs of our business in order for us to remain competitive. Our failure to implement, execute, assess and reassess our strategic and operating plans in a timely manner or at all, could have a material and adverse effect on our business or results of operations. In addition, we may not realize the cost savings, benefits

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or improvements associated with such plans, or we may incur excess costs associated with such plans or not have the financial resources available to fund the costs associated with such plans, which could each have a material and adverse effect on our business or results of operations.

We may not effectively manage our growth, which could materially harm our business.

The growth of our business has placed and may continue to place significant demands on our management, personnel, systems and resources. To manage our growth, we must continue to improve our operational and financial systems and managerial controls and procedures, and we will need to continue to expand, train and manage our personnel. We must also maintain close coordination among our technology, compliance, legal, risk management, accounting and finance, marketing and sales departments. We may not manage our growth effectively, and if we fail to do so, our business could be materially and adversely harmed.

If we continue to grow, we may be required to increase our investment in facilities, personnel and financial and management systems and controls. Continued growth, especially in connection with expansion into new business lines, may also require expansion of our procedures for monitoring and assuring our compliance with applicable regulations and that we recruit, integrate, train and manage a growing employee base. The expansion of our existing business, our expansion into new businesses and the resulting growth of our employee base increase our need for internal audit and monitoring processes that are more extensive and broader in scope than those we have historically required. We may not be successful in implementing all of the processes that are necessary. Further, unless our growth results in an increase in our revenues that is proportionate to the increase in our costs associated with this growth, our operating margins and profitability will be materially and adversely affected.

As a holding company, we depend on the ability of our subsidiaries to transfer funds to us to pay dividends and to meet our obligations.

We act as a holding company for our subsidiaries and do not have any significant operations of our own. Dividends from our subsidiaries are our principal sources of cash to meet our obligations and pay dividends, if any, on our common stock. These obligations include our operating expenses and interest and principal payments on our current and any future borrowings. The agreements governing our credit facilities restrict our subsidiaries' ability to pay dividends or otherwise transfer cash to us. Under our credit facility, our subsidiaries cannot make distributions to us if a default or an event of default has occurred and is continuing at the time of such distribution. If the cash we receive from our subsidiaries pursuant to dividends or otherwise is insufficient for us to fund any of these obligations, or if a subsidiary is unable to pay dividends to us, we may be required to raise cash through the incurrence of additional debt, the issuance of additional equity or the sale of assets.

The insurance laws and regulations of the states in which our regulated insurance company subsidiaries operate regulate the amount of dividends and distributions we receive from our insurance company subsidiaries. In general, dividends in excess of prescribed limits are deemed "extraordinary" and require insurance regulatory approval. Ordinary dividends, for which no regulatory approval is generally required, are limited to amounts determined by a formula, which varies by state. Some states have an additional stipulation that dividends may only be paid out of earned surplus. States also regulate transactions between our insurance company subsidiaries and our other subsidiaries, such as those relating to the shared services, and in some instances, require prior approval of such transactions within the holding company structure. If insurance regulators determine that payment of an ordinary dividend or any other payments by our insurance company subsidiaries to us (such as payments for employee or other services) would be adverse to policyholders or creditors, the regulators may block or otherwise restrict such payments that would otherwise be permitted without prior approval. In addition, there could be future regulatory actions restricting the ability of our insurance company subsidiaries to pay dividends or share services. Please see the Note, "Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions," in the Notes to Consolidated Financial Statements included in ITEM 1 of this Form 10-Q for additional information relating to dividend restrictions for our insurance company subsidiaries.

Our success is dependent upon the retention and acquisition of talented people and the skills and abilities of our management team and key personnel.

Our business depends on the efforts, abilities and expertise of our senior executives, particularly our Chairman, President and Chief Executive Officer, Richard S. Kahlbaugh, and our other key personnel. Mr. Kahlbaugh and our other senior executives are important to our success because they have been instrumental in setting our strategic direction, operating our business, identifying, recruiting and training key personnel, maintaining relationships with our clients, and identifying business opportunities. The loss of one or more of these executives or other key individuals could impair our business and development until we find qualified replacements. We may not be able to replace these individuals quickly or with persons of equal experience and capabilities. Although we have employment agreements with certain of these individuals, we cannot prevent them from terminating their employment with us. In addition, our non-compete agreements with such individuals may not be enforced by the courts. We do not maintain key man life insurance policies on any of our executive officers except for Mr. Kahlbaugh. If we are unable to attract and retain talented employees, it could have a material adverse effect on our business, operating results and financial condition.

We may need to raise additional capital in the future, but there is no assurance that such capital will be available on a timely basis, on acceptable terms or at all.

We may need to raise additional funds in order to grow our business or fund our strategy or acquisitions. Additional financing may not be available in sufficient amounts or on terms acceptable to us and may be dilutive to existing stockholders if raised through additional

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equity offerings. A significant portion of our funding is under our existing credit facility, which matures in August 2017. Additionally, any securities issued to raise such funds may have rights, preferences and privileges senior to those of our existing stockholders. If adequate funds are not available on a timely basis or on acceptable terms, our ability to expand, develop or enhance our services and products, enter new markets, consummate acquisitions or respond to competitive pressures could be materially limited.

Risks Related to Our Products and Services

Our products and services rely on independent financial institutions, lenders and retailers for distribution, and the loss of these distribution sources, or the failure of our distribution sources to sell our products could materially and adversely affect our business and results of operations.

We distribute our products and services through financial institutions, lenders and retailers. Although our contracts with these clients are typically exclusive, they are subject to cancellation on relatively short notice. In addition, the distributors typically do not have any minimum performance or sales requirements and our revenue is dependent on the level of business conducted by the distributor as well as the effectiveness of their sales efforts, each of which is beyond our control. The following factors are among those that could materially reduce our sales and revenues:

• the impairment of our distribution relationships;

• the loss of a significant number of our distribution relationships;

• the failure to offer increasingly competitive products;

• the increase in sales of competitors' services and products by these distributors;

• the decline in the distributors overall business activity; or

• the effectiveness of their sales of our products.

In addition, our growth is dependent in part on our ability to identify, attract and retain new distribution relationships and successfully implement our information systems with those of our new distributors.

Reinsurance may not be available or adequate to protect us against losses, and we are subject to the credit risk of reinsurers.

As part of our overall risk and capacity management strategy for our insurance products, we purchase reinsurance for a substantial portion of the risks underwritten through third party reinsurance companies. Market conditions beyond our control determine the availability and cost of the reinsurance protection we seek to renew or purchase. States also could impose restrictions on these reinsurance arrangements, such as requiring our insurance company subsidiaries to retain a minimum amount of underwriting risk, which could affect our profitability and results of operations. Reinsurance for certain types of catastrophes generally could become unavailable or prohibitively expensive. Such changes could substantially increase our exposure to the risk of significant losses from natural or man-made catastrophes and could hinder our ability to write future business.

Although the reinsurer is liable to the respective insurance company subsidiary to the extent of the ceded reinsurance, the insurance company remains liable to the insured as the direct insurer on all risks reinsured. Ceded reinsurance arrangements, therefore, do not eliminate the obligations of our insurance company subsidiaries to pay claims. While the captive reinsurance companies owned by our clients are generally required to maintain trust accounts with sufficient assets to cover the reinsurance liabilities and we manage these trust accounts on behalf of these reinsurance companies, we are subject to credit risk with respect to our ability to recover amounts due from reinsurers. The inability to collect amounts due from reinsurers could have a material adverse effect on our results of operations and financial condition.

Our reinsurance facilities are generally subject to annual renewal. We may not be able to maintain our current reinsurance facilities and our clients may not be able to continue to operate their captive reinsurance companies. As a result, even where highly desirable or necessary, we may not be able to obtain other reinsurance facilities in adequate amounts and at favorable rates. If we are unable to renew our expiring facilities or to obtain or structure new reinsurance facilities, either our net exposures would increase or, if we are unwilling to bear an increase in net exposures, we may have to reduce the level of our underwriting commitments. Either of these potential developments could have a material adverse effect on our results of operations and financial condition.

The structure of some of our commissions exposes us to risks related to the creditworthiness of some of our agents.

We are subject to the credit risk of some of the agents with which we contract to sell our products and services. We typically advance agents' commissions as part of our product offerings. These advances are a percentage of the premium charged. If we over-advance such commissions to agents, they may not be able to fulfill their payback obligations, which could have a material adverse effect on our results of operations and financial condition.

A downgrade in the ratings of our insurance company subsidiaries may materially and adversely affect relationships with clients and adversely affect our results of operations.

Claims paying ability and financial strength ratings are each a factor in establishing the competitive position of our insurance company subsidiaries. A ratings downgrade, or the potential for such a downgrade, could, among other things, materially and adversely affect relationships with clients, brokers and other distributors of our services and products, thereby negatively affecting our results of operations, and materially and adversely affect our ability to compete in our markets. Rating agencies can be expected to continue to

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monitor our financial strength and claims paying ability, and no assurances can be given that future ratings downgrades will not occur, whether due to changes in our performance, changes in rating agencies' industry views or ratings methodologies, or a combination of such factors.

Our actual claims losses may exceed our reserves for claims, which may require us to establish additional reserves that may materially and adversely reduce our business, results of operations and financial condition.

We maintain reserves to cover our estimated ultimate exposure for claims with respect to reported claims and incurred but not reported claims as of the end of each accounting period. Reserves, whether calculated under accounting principles generally accepted in the United States or statutory accounting principles, do not represent an exact calculation of exposure. Instead, they represent our best estimates, generally involving actuarial projections, of the ultimate settlement and administration costs for a claim or group of claims, based on our assessment of facts and circumstances known at the time of calculation. Future trends in claims severity, frequency, judicial theories of liability and other factors may affect the adequacy of reserves. These variables are affected by external factors such as changes in the economic cycle, unemployment, changes in the social perception of the value of work, emerging medical perceptions regarding physiological or psychological causes of disability, emerging health issues, new methods of treatment or accommodation, inflation, judicial trends, legislative changes, as well as changes in claims handling procedures. Many of these items are not directly quantifiable, particularly on a prospective basis. Reserve estimates are refined as experience develops. We reflect adjustments to reserves, both positive and negative, in the statement of income in the period in which we update such estimates. Because the establishment of reserves is an inherently uncertain process involving estimates of future losses, we can give no assurances that ultimate losses will not exceed existing claims reserves. In general, future loss development could require reserves to be increased, which could have a material adverse effect on our business, results of operations and financial condition.

Our investment portfolio is subject to several risks that may diminish the fair value of our invested assets and cash, which could have a material and adverse effect on our business and profitability.

Investment returns are an important part of our overall profitability and significant interest rate fluctuations, or prolonged periods of low interest rates, could impair our profitability. Interest rates are highly sensitive to many factors, including governmental monetary policies, domestic and international economic and political conditions and other factors beyond our control. We have a significant portion of our investments in cash and liquid short-term investments. Accordingly, during prolonged periods of declining or low market interest rates, such as those we have been experiencing since 2008, the interest we receive on such investments decreases and affects our profitability. In addition, certain factors affecting our business, such as volatility of claims experience, could force us to liquidate securities prior to maturity, causing us to incur capital losses. If we do not structure our investment portfolio so that it matches our insurance liabilities, we may have to liquidate investments prior to maturity at a significant loss to cover such liabilities.

We classify all of our fixed maturity securities as available-for-sale with any changes in the fair value of these securities reflected on our Consolidated Balance Sheets. The fair value of the fixed maturity securities in our portfolio and the investment income from these securities fluctuate depending on general economic and market conditions. The fair value generally increases or decreases in an inverse relationship with fluctuations in interest rates, while net investment income realized by us from future investments in fixed maturity securities will generally increase or decrease with interest rates. In addition, actual net investment income and/or cash flows from investments that carry prepayment risk may differ from those anticipated at the time of investment due to interest rate fluctuations.

We employ asset/liability management strategies to reduce the adverse effects of interest rate volatility and to increase the likelihood that cash flows are available to pay claims as they become due. Our asset/liability management strategies may fail to eliminate or reduce the adverse effects of interest rate volatility, and significant fluctuations in the level of interest rates may therefore have a material adverse effect on our results of operations and financial condition.

We are subject to credit risk in our investment portfolio, primarily from our investments in corporate bonds, preferred securities and municipal bonds. Defaults by third parties in the payment or performance of their obligations could reduce our investment income and realized investment gains or result in the recognition of investment losses. The fair value of our investments may be materially and adversely affected by increases in interest rates, downgrades in the corporate bonds included in the portfolio and by other factors that may result in the recognition of other-than-temporary impairments. Each of these events may cause us to reduce the fair value of our investment portfolio.

Further, the fair value of any particular fixed maturity security is subject to impairment based on the creditworthiness of a given issuer. Our fixed maturity portfolio may include below investment grade securities (rated "BB" or lower by nationally recognized securities rating organizations). These investments generally provide higher expected returns, but present greater risk and are typically less liquid than investment grade securities. A significant increase in defaults and impairments on our fixed maturity investment portfolio could have a material adverse effect on our results of operations and financial condition.

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Risks Related to Regulatory and Legal Matters

We are subject to extensive governmental laws and regulations, which increase our costs and could restrict the conduct of our business.

Our operations are subject to extensive regulation and supervision in the jurisdictions in which we do business. Such regulation or compliance could reduce our profitability or limit our growth by increasing the costs of compliance, limiting or restricting the products or services we sell, or the methods by which we sell our services and products, or subjecting our business to the possibility of regulatory actions or proceedings. In all jurisdictions, the applicable laws and regulations are subject to amendment or interpretation by regulatory authorities. Generally, such authorities have broad discretion to grant, renew or revoke licenses and approvals and to implement new regulations. The jurisdictions in which we operate may prohibit or temporarily suspend us from carrying on some or all of our activities or otherwise fine or penalize us. We can give no assurances that we can continue our business in each jurisdiction as we have in the past. Regulatory authorities generally design laws and regulations to protect the interests of policyholders. To that end, the laws of the various states establish insurance departments and other regulatory agencies with broad powers with respect to matters, such as:

• licensing and authorizing companies and agents to transact business;

• regulating capital and surplus and dividend requirements;

• regulating underwriting limitations;

• regulating the ability of companies to enter and exit markets;

• imposing statutory accounting requirements and annual statement disclosures;

• approving changes in control of insurance companies;

• regulating premium rates, including the ability to increase or maintain premium rates;

• regulating trade billing and claims practices;

• regulating certain transactions between affiliates;

• regulating reinsurance arrangements, including the balance sheet credit that may be taken by the ceding or direct insurer;

• mandating certain terms and conditions of coverage and benefits;

• regulating the content of disclosures to consumers;

• regulating the type, amounts and valuation of investments;

• mandating assessments or other surcharges for guaranty funds and the ability to recover such assessments in the future through premium increases;

• regulating market conduct and sales practices of insurers and agents, including compensation arrangements; and

• regulating a variety of other financial and non-financial components of an insurer's business.

Our non-insurance products and certain aspects of our insurance products are subject to various other federal and state regulations, including state and federal consumer protection, privacy and other laws.

An insurer's ability to write new business is partly a function of its statutory surplus. Maintaining appropriate levels of surplus as measured by statutory accounting principles is important to insurance regulatory authorities and the private agencies that rate insurers' claims-paying abilities and financial strength. Failure to maintain certain levels of statutory surplus could result in increased regulatory scrutiny, a downgrade by rating agencies or enforcement action by regulatory authorities.

We may be unable to maintain all required licenses and approvals and, despite our best efforts, our business may not fully comply with the wide variety of applicable laws and regulations or the relevant regulators' interpretations of such laws and regulations. In addition, some regulatory authorities have relatively broad discretion to grant, renew or revoke licenses and approvals or to limit or restrain operations in their jurisdiction. If we do not have the requisite licenses and approvals or do not comply with applicable regulatory requirements, the insurance regulatory authorities could prohibit or temporarily suspend us from operating, limit some or all of our activities or financially penalize us. These types of actions could have a material adverse effect on our results of operations and financial condition.

Failure to protect our clients' confidential information and privacy could result in the loss of our reputation and customers, reduction in our profitability and subject us to fines, penalties and litigation, which could adversely affect our results of operations and financial condition.

We retain confidential information in our information systems, and we are subject to a variety of privacy regulations and confidentiality obligations. For example, some of our activities are subject to the privacy regulations of the Gramm-Leach-Bliley Act. We also have contractual obligations to protect confidential information we obtain from our clients. These obligations generally require us, in accordance with applicable laws, to protect such information to the same extent that we protect our own confidential information. We have implemented physical, administrative and logical security systems with the intent of maintaining the physical security of our facilities and systems and protecting our clients' and their customers' confidential information and personally-identifiable information against unauthorized access through our information systems or by other electronic transmission or through misdirection, theft or loss of data. Despite such efforts, we may be subject to a breach of our security systems that results in unauthorized access to our facilities and/or the information we are trying to protect. Anyone who is able to circumvent our security measures and penetrate our information systems could access, view, misappropriate, alter or delete any information in the systems, including personally identifiable customer information and proprietary business information. In addition, most states require that customers be notified if a security breach results

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in the disclosure of personally-identifiable customer information. If our information systems security is compromised resulting in the inappropriate disclosure of such information our results of operations and financial condition could be materially affected due to, among other things, unfavorable publicity, reputational damage, governmental inquiry and oversight, difficulty in marketing our services, loss of clients, significant civil and criminal liability and the incurrence of significant technical, legal and other expenses.

Changes in regulation may adversely affect our business, results of operations and financial condition and limit our growth.

Legislation or other regulatory reform that increases the regulatory requirements imposed on us or that changes the way we are able to do business may significantly harm our business or results of operations in the future. If we were unable for any reason to comply with these requirements, our noncompliance could result in substantial costs to us and may have a material adverse effect on our results of operations and financial condition. Legislative or regulatory changes that could significantly harm us include, but are not limited to:

• prohibiting our clients from providing debt cancellation policies or offering other ancillary products;

• prohibiting insurers from fronting captive reinsurance arrangements;

• placing or reducing interest rate caps on the consumer finance products our clients offer or including voluntary products in the annual percentage rate calculation;

• limitations or imposed reductions on premium levels or the ability to raise premiums on existing policies;

• increases in minimum capital, reserves and other financial viability requirements;

• impositions of increased fines, taxes or other penalties for improper licensing, the failure to promptly pay claims, however defined, or other regulatory violations;

• increased licensing requirements;

• restrictions on the ability to offer certain types of products;

• new or different disclosure requirements on certain types of products; and

• imposition of new or different requirements for coverage determinations.

In recent years, the state insurance regulatory framework has come under increased federal scrutiny and some state legislatures have considered or enacted laws that may alter or increase state authority to regulate insurance companies and insurance holding companies. Further, the NAIC and state insurance regulators are re-examining existing laws and regulations, specifically focusing on modifications to holding company regulations, interpretations of existing laws and the development of new laws and regulations. Additionally, there have been attempts by the NAIC and several states to limit the use of discretionary clauses in policy forms. The elimination of discretionary clauses could increase our product costs. New interpretations of existing laws and the passage of new legislation may harm our ability to sell new services and products and increase our claims exposure on policies we issued previously. In addition, the NAIC's proposed expansion of the Market Conduct Annual Statement could increase the likelihood of examinations of insurance companies operating in niche markets. Court decisions that affect the insurance industry could result in the release of previously protected confidential and privileged information by departments of insurance, which could increase the risk of litigation.

Traditionally, the U.S. federal government has not directly regulated the business of insurance. However, federal legislation and administrative policies in several areas can have a significant and adverse affect on insurance companies. These areas include financial services regulation, securities regulation, privacy, tort reform legislation and taxation. For example, the Dodd-Frank Act provides for the enhanced federal supervision of financial institutions, including insurance companies in certain circumstances, and financial activities that represent a systemic risk to financial stability or the U.S. economy.

The Dodd-Frank Act established the Federal Insurance Office within the U.S. Treasury Department to monitor all aspects of the insurance industry and its authority would likely extend to all lines of insurance that our insurance company subsidiaries write. The director of the Federal Insurance Office serves in an advisory capacity to the Financial Stability Oversight Council. The director has the ability to recommend that an insurance company or an insurance holding company be subject to heightened prudential standards by the Federal Reserve, if it is determined that financial distress at the company could pose a threat to the financial stability of the U.S. economy. The Dodd-Frank Act can also preempt state laws when inconsistent with certain international agreements and would streamline the regulation of reinsurance and surplus lines insurance. At this time, we cannot assess whether any other proposed legislation or regulatory changes will be adopted, or what impact, if any, the Dodd-Frank Act or any other legislation or changes could have on our results of operations, financial condition or liquidity.

With regard to our payment protection products, there are federal and state laws and regulations that govern the disclosures related to lenders' sales of those products. Our ability to offer and administer those products on behalf of financial institutions is dependent upon their continued ability to sell those products. To the extent that federal or state laws or regulations change to restrict or prohibit the sale of these products, our revenues would be adversely affected. The Dodd-Frank Act created a new Consumer Financial Protection Bureau ("CFPB") designed to add new regulatory oversight for the sales practices of these products. Recently, the CFPB's enforcement actions have resulted in large refunds and civil penalties against financial institutions in connection with their marketing of payment protection and other products. Due to such regulatory actions, some lenders may reduce their sales and marketing of payment protection and other ancillary products, which may adversely affect our revenues. The full impact of the CFPB's oversight is unpredictable and continues to evolve.

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Further, in a time of financial uncertainty or a prolonged economic downturn, regulators may choose to adopt restrictive insurance laws and regulations. For example, insurance regulators may choose to restrict the ability of insurance company subsidiaries to make payments to their parent companies or reject rate increases due to the economic environment.

With respect to the property and casualty insurance policies we underwrite, federal legislative proposals regarding National Catastrophe Insurance, if adopted, could reduce the business need for some of the related products we provide. Additionally, as the U.S. Congress continues to respond to the recent housing foreclosure crisis, it could enact legislation placing additional barriers on creditor-placed insurance.

In recent years, several large organizations became subjects of intense public scrutiny due to high-profile data security breaches involving sensitive financial and health information. These events focused national attention on identity theft and the duty of organizations to notify impacted consumers in the event of a data security breach. Existing legislation in most states requires customer notification in the event of a data security breach. In addition, some states are adopting laws and regulations requiring minimum information security practices with respect to the collection and storage of personally identifiable consumer data, and several bills before Congress contain provisions directed to national information security standards and breach notification requirements. Several significant legal, operational and reputational risks exist with regard to a data breach and customer notification. A breach of data security requiring public notification can result in regulatory fines, penalties or sanctions, civil lawsuits, loss of reputation, loss of clients and reduction of our profitability.

Our business is subject to risks related to litigation and regulatory actions.

We may be materially and adversely affected by judgments, settlements, unanticipated costs or other effects of legal and administrative proceedings now pending or that may be instituted in the future, or from investigations by regulatory bodies or administrative agencies. From time to time, we have had inquiries from regulatory bodies and administrative agencies relating to the operation of our business. Such inquiries may result in various audits, reviews and investigations. An adverse outcome of any investigation by, or other inquiries from, such bodies or agencies could have a material adverse effect on us and result in the institution of administrative or civil proceedings, sanctions, the payment of fines and penalties, changes in personnel, increased review and scrutiny of us by our clients, regulatory authorities, potential litigants, the media and others.

In particular, our insurance operations and certain of our membership and warranty operations are subject to comprehensive regulation and oversight by insurance departments in jurisdictions in which we do business. These insurance departments have broad administrative powers with respect to all aspects of the insurance business and, in particular, monitor the manner in which an insurance company offers, sells and administers its products. Therefore, we may from time to time be subject to a variety of legal and regulatory actions relating to our current and past business operations, including, but not limited to:

• disputes over coverage or claims adjudication;

• disputes over claim payment amounts and compliance with individual state regulatory requirements;

• disputes regarding sales practices, disclosures, premium refunds, licensing, regulatory compliance, underwriting and compensation arrangements;

• disputes with taxation and insurance authorities regarding our tax liabilities;

• periodic examinations of compliance with applicable federal and state laws; and

• industry-wide investigations regarding business practices including, but not limited to, the use of finite reinsurance and the marketing and refunding of insurance policies or certificates of insurance.

The prevalence and outcomes of any such actions cannot be predicted, and such actions or any litigation may have a material adverse effect on our results of operations and financial condition. In addition, if we were to experience difficulties with our relationship with a regulatory body in a given jurisdiction, it could have a material adverse effect on our ability to do business in that jurisdiction.

In addition, plaintiffs continue to bring new types of legal claims against insurance and related companies. Current and future court decisions and legislative activity may increase our exposure to these types of claims. Multi-party or class action claims may present additional exposure to substantial economic, non-economic and/or punitive damage awards. The success of even one of these claims, if it resulted in a significant damage award or a detrimental judicial ruling, could have a material adverse effect on our results of operations and financial condition. This risk of potential liability may make reasonable settlements of claims more difficult to obtain. We cannot determine with any certainty what new theories of liability or recovery may evolve or what their impact may be on our business.

We cannot predict at this time the effect that current litigation, investigations and regulatory activity will have on the industries in which we operate or our business. In light of the regulatory and judicial environments in which we operate, we will likely become subject to further investigations and lawsuits from time to time in the future. Our involvement in any investigations and lawsuits could cause us to incur legal and other costs, and if found to have violated any laws, we could be required to pay fines and damages, perhaps in material amounts. In addition, we could be materially and adversely affected by the negative publicity for the insurance and other financial services industries related to any such proceedings and by any new industry-wide regulations or practices that may result from any such proceedings.

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Our cash and cash equivalents could be adversely affected if the financial institutions with which our cash and cash equivalents are deposited fail.

We maintain cash and cash equivalents with major third party financial institutions, including interest-bearing money market accounts.

In the United States, these accounts were fully insured by the Federal Deposit Insurance Corporation ("FDIC") regardless of account balance through the Transaction Account Guarantee ("TAG") program created by Section 343 of the Dodd-Frank Act. The expiration of the TAG program on December 31, 2012, caused the FDIC's standard insurance limit of $250,000 per depositor per institution to be reimposed on January 1, 2013. Thus, our accounts containing cash and cash equivalents may exceed the FDIC's standard $250,000 insurance limit from time to time.

We may be subject to assertions that taxes must be collected based on sales and use of our services in various states, which could expose us to liability and cause material harm to our business, financial condition and results of operations.

Whether sales of our services are subject to state sales and use taxes is uncertain, due in part to the nature of our services and the relationships through which we offer our services, as well as changing state laws and interpretations of those laws. One or more states may seek to impose sales tax, use tax or other tax collection obligations on us, whether based on sales by us or our resellers or clients, including for past sales. A successful assertion that we should be collecting sales or other related taxes on our services could result in substantial tax liabilities for past sales, discourage customers from purchasing our services, discourage clients from offering or billing for our services, or otherwise cause material harm to our business, financial condition and results of operations.

Risks Related to Our Indebtedness

Our indebtedness may limit our financial and operating activities and may materially and adversely affect our ability to incur additional debt to fund future needs.

Our debt service obligations vary annually based on the amount of our indebtedness and the associated fixed and floating interest rates. See "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Liquidity and Capital Resources - Liquidity" in this Form 10-Q, regarding the amount of outstanding debt and our annual debt service. Although we believe that our current cash flows will be adequate to cover our annual interest expense, any increase in our indebtedness or any decline in the amount of cash available to service our indebtedness increases the possibility that we could not pay, when due, the principal of, interest on or other amounts due with respect to our indebtedness. In addition, our indebtedness and any future indebtedness we may incur could:

• make it more difficult for us to satisfy our obligations with respect to our indebtedness, including financial and other restrictive covenants, which could result in an event of default under the agreements governing our indebtedness;

• make us more vulnerable to adverse changes in general economic, industry and competitive conditions and adverse changes in government regulation;

• require us to dedicate a substantial portion of our cash flows from operations to payments on our indebtedness, thereby reducing the availability of our cash flows to fund working capital, capital expenditures, acquisitions and other general corporate purposes;

• limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

• place us at a competitive disadvantage compared to competitors that have less debt; and

• limit our ability to borrow additional amounts for working capital, capital expenditures, acquisitions, debt service requirements, and execution of our business strategy or other purposes.

Any of the above-listed factors could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Increases in interest rates could increase interest payable under our variable rate indebtedness.

We are subject to interest rate risk in connection with our variable rate indebtedness. See "QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK - Interest Rate Risk" in our 2013 Form 10-K, regarding our interest rate risk and "MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS - Liquidity and Capital Resources - Liquidity" in this Report, regarding the amount of outstanding variable rate debt. Interest rate changes could increase the amount of our interest payments and thus negatively affect our future earnings and cash flows. If we do not have sufficient earnings, we may be required to refinance all or part of our existing debt, sell assets, borrow more money or sell more securities, none of which we can guarantee we will be able to do.

We may enter into hedging transactions that may become ineffective, which may adversely affect our financial condition.

Part of our interest rate risk strategy involves entering into hedging transactions to mitigate the risk of variable interest rate instruments by converting the variable interest rate to a fixed interest rate. We regularly evaluate each hedging item for hedge effectiveness. If it is determined that a hedging transaction is ineffective, we may be required to record losses reflected in our results of operations which could adversely impact our financial condition.

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Despite our indebtedness levels, we may still be able to incur more indebtedness, which could further exacerbate the risks related to our indebtedness described above.

We may be able to incur substantial additional indebtedness in the future subject to the limitations contained in the agreements governing our indebtedness. If we incur additional debt, the risks that we now face due to our indebtedness could intensify.

Restrictive covenants in the agreements governing our indebtedness may restrict our ability to pursue our business strategies.

The agreements governing our indebtedness contain a number of restrictive covenants that impose significant operating and financial restrictions on us and may limit our ability to pursue our business strategies or undertake actions that may be in our best interests. The agreements governing our indebtedness include covenants restricting, among other things, our ability to:

• incur or guarantee additional debt;

• incur liens;

• complete mergers, consolidations and dissolutions;

• sell certain of our assets that have been pledged as collateral; and

• undergo a change in control.

We pledged our assets to secure some of our existing indebtedness.

Our credit facility, entered into in August 2012, with Wells Fargo Bank, N.A. is secured by substantially all of our property and assets and property and assets owned by LOTS Intermediate Co. and certain of our subsidiaries that act as guarantors of our existing indebtedness. Such assets include the stock of LOTS Intermediate Co. and the right, title and interest of the borrowers and each guarantor in their respective material real estate property, fixtures, accounts, equipment, investment property, inventory, instruments, general intangibles, intellectual property, money, cash or cash equivalents, software and other assets and, in each case, the proceeds thereof, subject to certain exceptions. In the event of a default under our indebtedness, the lender could foreclose against the assets securing such obligations. A foreclosure on these assets would have a material adverse effect on our business, financial condition, results of operations and cash flows.

Risks Related to Our Technology and Intellectual Property

Our information systems may fail or their security may be compromised, which could damage our business and materially and adversely affect our results of operations and financial condition.

Our business is highly dependent upon the effective operation of our information systems and our ability to store, retrieve, process and manage significant databases and expand and upgrade our information systems. We rely on these systems throughout our business for a variety of functions, including marketing and selling our products and services, performing our services, managing our operations, processing claims and applications, providing information to clients, performing actuarial analyses and maintaining financial records. The interruption or loss of our information processing capabilities through the loss of stored data, programming errors, the breakdown or malfunctioning of computer equipment or software systems, telecommunications failure or damage caused by weather or natural disasters or any other significant disruptions could harm our business, ability to generate revenues, client relationships, competitive position and reputation. As part of our disaster recovery procedures, we have additional data processing locations in Jacksonville, Florida and Atlanta, Georgia. Although we have disaster recovery procedures and insurance to protect against certain contingencies, such measures may not be effective or insurance may not continue to be available at reasonable prices to cover all such losses or be sufficient to compensate us for the loss of business that may result from any failure of our information systems. In addition, our information systems may be vulnerable to physical or electronic intrusions, computer viruses or other attacks, which could disable our information systems and our security measures may not prevent such attacks. The failure of our systems due to any security breaches, intrusions or attacks could cause significant interruptions to our operations, which could result in a material adverse effect on our business, results of operations and financial condition.

The failure to effectively maintain and modernize our systems to keep up with technological advances could materially and adversely affect our business.

Our business is dependent upon our ability to ensure that our information systems keep up with technological advances. Our ability to keep our systems integrated with those of our clients is critical to the success of our business. If we do not effectively maintain our systems and update them to address technological advancements, our relationships and ability to do business with our clients may be materially and adversely affected. Our business depends significantly on effective information systems, and we have many different information systems utilized to conduct our business. We must commit significant resources to maintain and enhance existing information systems and develop new systems that allow us to keep pace with continuing changes in information processing technology, evolving industry, regulatory and legal standards and changing client preferences. A failure to maintain effective and efficient information systems, or a failure to efficiently and effectively consolidate our information systems and eliminate redundant or obsolete applications, could have a material adverse effect on our results of operations and financial condition or our ability to do business in particular jurisdictions. If we do not effectively maintain adequate systems, we could experience adverse consequences, including:

• the inability to effectively market and price our services and products and make underwriting and reserving decisions;

• the loss of existing clients;

• difficulty attracting new clients;

• regulatory problems, such as a failure to meet prompt payment obligations;

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• internal control problems;

• exposure to litigation;

• security breaches resulting in loss of data; and

• increases in administrative expenses.

Our success will depend, in part, on our ability to protect our intellectual property rights and our ability not to infringe upon the intellectual property rights of third parties.

The success of our business will depend, in part, on preserving our trade secrets, maintaining the security of our know-how and data and operating without infringing upon patents and proprietary rights held by third parties. Failure to protect, monitor and control the use of our intellectual property rights could cause us to lose a competitive advantage and incur significant expenses. We rely on a combination of contractual provisions, confidentiality procedures and copyright, trademark, service mark and trade secret laws to protect the proprietary aspects of our brands, technology and data. These legal measures afford only limited protection, and competitors or others may gain access to our intellectual property and proprietary information.

Our trade secrets, data and know-how could be subject to unauthorized use, misappropriation, or disclosure. Third parties may challenge our trademarks, forcing us to re-brand our services or products, resulting in loss of brand recognition and requiring us to devote resources to advertising and marketing new brands or licensing. If we are found to have infringed upon the intellectual property rights of third parties, we may be subject to injunctive relief restricting our use of affected elements of intellectual property used in the business. In addition, we may be required to, among other things, pay royalties or enter into licensing agreements in order to obtain the rights to use necessary technologies, which may not be possible on commercially reasonable terms, or we may be required to redesign our systems, which may not be feasible.

Furthermore, litigation may be necessary to enforce our intellectual property rights to protect our trade secrets and to determine the validity and scope of our proprietary rights. The intellectual property laws and other statutory and contractual arrangements we currently depend upon may not provide sufficient protection in the future to prevent the infringement, use or misappropriation of our trademarks, data, technology and other services and products. Policing unauthorized use of intellectual property rights can be difficult and expensive, and adequate remedies may not be available. Any future litigation, regardless of outcome, could result in substantial expense and diversion of resources with no assurance of success and could have a material adverse effect on our business, financial condition, results of operations, and cash flows.

Risks Related to Our Common Stock

There may not be an active, liquid trading market for our common stock.

Prior to our Initial Public Offering, there had been no public market for shares of our common stock. The trading activity in our securities is relatively low and our company has a relatively small public float.  We cannot predict the extent to which investor interest in our Company will continue to maintain an active and liquid trading market. If an active trading market in our common stock does not continue, you may have difficulty selling shares of our common stock that you own or purchase.

As a public company, we are subject to additional financial and other reporting and corporate governance requirements that may be difficult for us to satisfy.

We are required to file with the SEC, annual and quarterly information and other reports specified in the Exchange Act. We are required to ensure that we have the ability to prepare financial statements that are fully compliant with all SEC reporting requirements on a timely basis. We are subject to other reporting and corporate governance requirements, including the requirements of the NYSE and certain provisions of the Sarbanes-Oxley Act of 2002 ("SOX") and the regulations promulgated thereunder, which impose significant compliance obligations upon us. Should we fail to comply with these rules and regulations we may face de-listing from the NYSE and face disciplinary actions from the SEC, which may adversely affect our stock price.

If our internal controls are found to be ineffective, our financial results or our stock price may be adversely affected.

Our most recent evaluation resulted in our conclusion that as of June 30, 2014, we were in compliance with Section 404 of SOX and our internal control over financial reporting was effective. We believe that we currently have adequate internal control procedures in place for future periods. However, in the future, if our internal controls over financial reporting are found ineffective or if we identify a material weakness in our financial reporting, investors may lose confidence in the reliability of our financial statements, which may adversely affect our financial results or our stock price.

Our principal stockholder has substantial control over us.

Affiliates of Summit Partners collectively and beneficially own approximately 62.0% of our outstanding common stock at June 30, 2014. Therefore, Summit Partners or its affiliates continue to be able to exert a significant degree of influence or actual control over our management and affairs and matters requiring stockholder approval, including the election of directors, a merger, consolidation or sale of all or substantially all of our assets, and any other significant transaction. The interests of this stockholder may not always coincide with our interests or the interests of our other stockholders. For instance, this concentration of ownership may have the effect of delaying or preventing a change in control of us otherwise favored by our other stockholders and could depress our stock price.

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We expect that our stock price will fluctuate significantly, which could cause a decline in the stock price, and holders of our common stock may not be able to resell shares at or above the cost of such shares.

Securities markets worldwide have experienced significant price and volume fluctuations, which may likely continue. This market volatility, as well as general economic, market or political conditions, could reduce the market price of our common stock regardless of our operating performance. The trading price of our common stock may be volatile and subject to wide price fluctuations in response to various factors, including:

• market conditions in the broader stock market;

• actual or anticipated fluctuations in our quarterly financial and operating results;

• introduction of new products or services by us or our competitors;

• issuance of new or changed securities analysts' reports or recommendations;

• investor perceptions of us and the industries in which we operate;

• sales, or anticipated sales, of large blocks of our stock;

• additions or departures of key personnel;

• regulatory or political developments;

• litigation and governmental investigations; and

• changing economic conditions.

These and other factors may cause the market price and demand for our common stock to fluctuate substantially, which may limit or prevent investors from readily selling their shares of common stock and may otherwise negatively affect the liquidity of our common stock. In addition, in the past, when the market price of a stock has been volatile, holders of that stock have sometimes instituted securities class action litigation against the company that issued the stock. If any of our stockholders brought a lawsuit against us, we could incur substantial costs defending the lawsuit. Such a lawsuit could also divert the time and attention of our management from our business, which could significantly harm our results of operations and reputation.

If a substantial number of shares become available for sale and are sold in a short period of time, the market price of our common stock could decline.

At June 30, 2014, we had 21,287,525 shares of common stock issued, including shares held in treasury, with our directors, executive officers and affiliates holding a significant majority of these shares. If our stockholders sell substantial amounts of our common stock in the public market, the market price of our common stock could decrease significantly. The perception in the public market that our existing stockholders might sell shares of common stock could also depress the market price of our common stock. A decline in the market price of our common stock might impede our ability to raise capital through the issuance of additional shares of our common stock or other equity securities.

If securities or industry analysts do not publish research or reports about our business, publish research or reports containing negative information about our business, adversely change their recommendations regarding our stock or if our results of operations do not meet their expectations, our stock price and trading volume could decline.

The trading market for our common stock is influenced by the research and reports that industry or securities analysts publish about us or our business. If one or more of these analysts cease coverage of our Company or fail to publish reports on us regularly, we could lose visibility in the financial markets, which in turn could cause our stock price or trading volume to decline. Moreover, if one or more of the analysts who cover us, downgrade our stock, or if our results of operations do not meet their expectations, our stock price could decline.

Some provisions of Delaware law and our amended and restated certificate of incorporation and bylaws may deter third parties from acquiring us and diminish the value of our common stock.

Our amended and restated certificate of incorporation and bylaws provide for, among other things:

• restrictions on the ability of our stockholders to call a special meeting and the business that can be conducted at such meeting;

• restrictions on the ability of our stockholders to remove a director or fill a vacancy on the Board of Directors;

• our ability to issue preferred stock with terms that the Board of Directors may determine, without stockholder approval;

• the absence of cumulative voting in the election of directors;

• a prohibition of action by written consent of stockholders unless such action is recommended by all directors then in office; and

• advance notice requirements for stockholder proposals and nominations.

These provisions in our amended and restated certificate of incorporation and bylaws may discourage, delay or prevent a transaction involving a change in control of the Company that is in the best interest of our non-controlling stockholders. Even in the absence of a takeover attempt, the existence of these provisions may adversely affect the prevailing market price of our common stock if they are viewed as discouraging future takeover attempts.

Applicable insurance laws may make it difficult to effect a change in control of us.

State insurance regulatory laws contain provisions that require advance approval, by the state insurance commissioner, of any change in control of an insurance company that is domiciled, or, in some cases, having such substantial business that it is deemed to be commercially domiciled, in that state. We own, directly or indirectly, all of the shares of stock of insurance companies domiciled in California, Delaware, Georgia and Louisiana, and 85% of the shares of stock of an insurance company domiciled in Kentucky. Because

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any purchaser of shares of our common stock representing 10% or more of the voting power of the capital stock of Fortegra generally are presumed to have acquired control of these insurance company subsidiaries, the insurance change in control laws of California, Delaware, Georgia, Louisiana and Kentucky would apply to such a transaction.

In addition, the laws of many states contain provisions requiring pre-notification to state agencies prior to any change in control of a non-domestic insurance company subsidiary that transacts business in that state. While these pre-notification statutes do not authorize the state agency to disapprove the change in control, they do authorize issuance of cease and desist orders with respect to the non-domestic insurer if it is determined that conditions, such as undue market concentration, would result from the change in control.

These laws may discourage potential acquisition proposals and may delay, deter or prevent a change of control of the Company, including through transactions, and in particular unsolicited transactions, that some or all of our stockholders might consider desirable.

We do not anticipate paying any cash dividends for the foreseeable future.

We currently intend to retain our future earnings, if any, for the foreseeable future, to repay indebtedness and for general corporate purposes. We do not intend to pay any dividends for the foreseeable future to holders of our common stock. As a result, capital appreciation in the price of our common stock, if any, will be your only source of gain on an investment in our common stock.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

(a) Not Applicable.

(b) Not Applicable.

(c) Issuer Purchases of Equity Securities

At June 30, 2014, Fortegra had a share repurchase plan, which allows the Company to purchase up to $15.0 million of the Company's common stock from time to time through open market or private transactions. The Board of Directors approved a $10.0 million share repurchase plan in November 2011 and increased the size of the plan by $5.0 million in August 2013. The share repurchase plan has no expiration date and provides for shares to be repurchased for general corporate purposes, which may include serving as a resource for funding potential acquisitions and employee benefit plans. The timing, price and quantity of purchases are at our discretion. In addition, we can discontinue or suspend the share repurchase plan at any time. There were no repurchases during the three months ended June 30, 2014.

The following table shows Fortegra's share repurchase plan activity for the three months ended June 30, 2014:

Period			Total Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares  Purchased as Part of Publicly Announced Plan	Maximum  Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plan
April 1, 2014	to	April 30, 2014	—	$	—	—	7,167,376
May 1, 2014	to	May 31, 2014	—	—		—	7,167,376
June 1, 2014	to	June 30, 2014	—	—		—	7,167,376
Total			—	$	—	—

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

ITEM 5. OTHER INFORMATION

None.

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ITEM 6. EXHIBITS

See the Exhibit Index following the signature page of this Form 10-Q for a list of exhibits filed with, furnished with or incorporated

by reference into this Form 10-Q.

SIGNATURES

Pursuant to the requirements 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.

			Fortegra Financial Corporation
Date:	August 14, 2014	By:	/s/ Richard S. Kahlbaugh
			Richard S. Kahlbaugh
			Chairman, President and Chief Executive Officer
			(Duly authorized officer)
Date:	August 14, 2014	By:	/s/ Walter P. Mascherin
			Walter P. Mascherin
			Executive Vice President and Chief Financial Officer
			(Duly authorized officer and Principal Financial and Accounting Officer)

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EXHIBIT INDEX
		Incorporated by Reference
Exhibit Number	Description of Exhibits	Form	File Number	Date Filed	Original Exhibit Number	Filed Herewith	Furnished Herewith
2.1	Agreement and Plan of Merger, dated as of March 7, 2007, by and among Summit Partners Private Equity Fund VII-A, L.P., Summit Partners Private Equity Fund VII-B, L.P., Summit Subordinated Debt Fund III-A, L.P., Summit Subordinated Debt Fund III-B, L.P., Summit Investors VI, L.P., LOS Acquisition Co., the Signing Stockholders and Life of the South Corporation and N.G. Houston III, as Stockholder Representative.	S-1	333-169550	9/23/2010	2.1
2.2	First Amendment to Merger Agreement, dated as of June 20, 2007 by and among Summit Partners Private Equity Fund VII-A, L.P., Summit Partners Private Equity Fund VII-B, L.P., Summit Subordinated Debt Fund III-A, L.P., Summit Subordinated Debt Fund III-B, L.P., Summit Investors VI, L.P., LOS Acquisition Co., the Signing Stockholders, and Life of the South Corporation and N.G. Houston, III, as Stockholder Representative.	S-1	333-169550	9/23/2010	2.2
2.3	Stock Purchase Agreement, dated as of April 15, 2009, by and among Willis HRH, Inc., Bliss and Glennon, Inc., LOTS Intermediate Co., Willis North America Inc. and Fortegra Financial Corporation.	S-1	333-169550	9/23/2010	2.3
2.4	Agreement and Plan of Merger, dated March 3, 2011 by and among eReinsure.com, Inc., a Delaware corporation, Alpine Acquisition Sub., Inc., a Delaware corporation, and Century Capital Partners III, L.P., as Agent solely for the purposes of Section 10.02, and LOTS Intermediate Co., a Delaware corporation.	8-K	001-35009	3/7/2011	2.1
2.5	Stock Purchase Agreement, dated December 2, 2013, by and among Fortegra Financial Corporation, a Delaware corporation, LOTS Intermediate Co., a Delaware corporation, Bliss and Glennon, Inc., a California corporation, eReinsure.com, Inc., a Delaware corporation, and AmWINS Holdings, LLC, a North Carolina limited liability company.	8-K	001-35009	1/7/2014	2.1
2.6	Agreement and Plan of Merger, dated August 11, 2014, among Tiptree Operating, LLC, Caroline Holdings LLC, Caroline Merger Sub, Inc. and Fortegra Financial Corporation.	8-K	001-35009	8/12/2014	2.1
3.1	Third Amended and Restated Certificate of Incorporation of Fortegra Financial Corporation.	S-1/A	333-169550	12/13/2010	3.3
3.2	Amended and Restated Bylaws of Fortegra Financial Corporation.	S-1/A	333-169550	11/29/2010	3.4
4.1	Form of Common Stock Certificate.	S-1/A	333-169550	12/13/2010	4.1
4.2	Stockholders Agreement, dated as of March 7, 2007, among Life of the South Corporation (together with its successors), the Rollover Stockholders (as defined therein), Employee Stockholders (as defined therein) and Investors (as defined therein).	S-1/A	333-169550	10/29/2010	4.2
10.1	Indenture, dated as of June 20, 2007, between LOTS Intermediate Co. and Wilmington Trust Company.	S-1	333-169550	9/23/2010	10.1
10.2	Form of Fixed/Floating Rate Senior Debenture (included in Exhibit 10.1).	S-1	333-169550	9/23/2010	10.2
10.3	Form of Fortegra Financial Corporation Director Indemnification Agreement for John R. Carroll and J.J. Kardwell.	S-1/A	333-169550	11/29/2010	10.18
10.4	Form of Fortegra Financial Corporation Director Indemnification Agreement for Francis M. Colalucci, Frank P. Filipps, Arun Maheshwari, Ted W. Rollins and Sean S. Sweeney.	S-1/A	333-169550	11/29/2010	10.19
10.5	Form of Fortegra Financial Corporation Officer Indemnification Agreement.	S-1/A	333-169550	12/3/2010	10.20
10.6	Form of Indemnity Agreement between Fortegra Financial Corporation, as Indemnitor, and the executive officers serving as plan committee members for the Fortegra Financial Corporation 401(k) Savings Plan, as Indemnitees.	S-1/A	333-169550	10/29/2010	10.21
10.7*	Executive Employment and Non-Competition Agreement, dated as of March 7, 2007, by and between Life of the South Corporation and Richard S. Kahlbaugh.	S-1/A	333-169550	12/3/2010	10.22

55

EXHIBIT INDEX
		Incorporated by Reference
Exhibit Number	Description of Exhibits	Form	File Number	Date Filed	Original Exhibit Number	Filed Herewith	Furnished Herewith
10.7.1*	Amendment No. 1 to Executive Employment and Non-Competition Agreement, dated as of November 1, 2010, by and between Fortegra Financial Corporation and Richard S. Kahlbaugh.	S-1/A	333-169550	12/3/2010	10.22.1
10.8*	Executive Employment and Non-Competition Agreement, dated as of October 1, 2010, by and between Fortegra Financial Corporation and Walter P. Mascherin.	S-1/A	333-169550	12/3/2010	10.27
10.9*	Life of the South Corporation 2005 Equity Incentive Plan.	S-1/A	333-169550	10/29/2010	10.28
10.10*	1995 Key Employee Stock Option Plan.	S-1/A	333-169550	10/29/2010	10.29
10.11*	Stock Option Agreement by and between Life of the South Corporation and Richard S. Kahlbaugh, dated as of November 18, 2005, as amended on March 7, 2007 and June 20, 2007.	S-1/A	333-169550	11/16/2010	10.30
10.12*	Stock Option Agreement by and between Life of the South Corporation and Richard Kahlbaugh, dated as of October 25, 2007.	S-1/A	333-169550	11/16/2010	10.31
10.13*	2010 Omnibus Incentive Plan.	S-1/A	333-169550	12/3/2010	10.32
10.14*	Employee Stock Purchase Plan.	S-1/A	333-169550	12/3/2010	10.33
10.15*	Deferred Compensation Agreement, dated January 1, 2006, between Life of the South Corporation and Richard S. Kahlbaugh.	S-1/A	333-169550	10/29/2010	10.35
10.16*	Form of Restricted Stock Award Agreement for Directors.	S-1/A	333-169550	12/3/2010	10.47
10.16.1*	Amended - Form of Restricted Stock Award Agreement for Directors, effective February 2013.	10-K	001-35009	4/1/2013	10.26.1
10.17*	Form of Restricted Stock Award Agreement for Employees.	S-1/A	333-169550	12/3/2010	10.48
10.17.1*	Amended - Form of Restricted Stock Award Agreement for Employees, effective February 18, 2013.	10-Q	001-35009	5/15/2013	10.27.1
10.18*	Form of Restricted Stock Award Agreement (Bonus Pool).	S-1/A	333-169550	12/3/2010	10.49
10.19*	Form of Nonqualified Stock Option Award Agreement.	S-1/A	333-169550	12/3/2010	10.50
10.19.1*	Amended - Form of Nonqualified Stock Option Award Agreement, effective February 18, 2013.	10-Q	001-35009	5/15/2013	10.29.1
10.20*	Executive Employment and Non-Competition Agreement, dated as of January 1, 2009, by and between Fortegra Financial Corporation and Joseph McCaw.	10-Q	001-35009	5/15/2012	10.39
10.21	Credit Agreement, dated August 2, 2012, as amended by amendment to Credit Agreement, dated October 4, 2013, among Fortegra Financial Corporation and LOTS Intermediate Co., as Borrowers; the initial Lenders named therein; Wells Fargo Bank, N.A., as Administrative Agent, Swingline Lender, and Issuing Lender; Wells Fargo Securities, LLC, as Bookrunner and Joint Lead Arranger; and Synovus Bank as Joint Lead Arranger and Syndication Agent. (Conformed Copy).	10-Q	001-35009	11/14/2013	10.34
10.21.1	Second Amendment to the Credit Agreement, dated April 11, 2014, by and among Fortegra Financial Corporation and LOTS Intermediate Co., as Borrowers; the Subsidiaries (as defined in the Credit Agreement) party thereto, each of the Lenders (as defined in the Credit Agreement) and Wells Fargo Bank, National Association, as administrative agent.	8-K	001-35009	4/16/2014	10.1
10.22	Subsidiary Guaranty Agreement, dated August 2, 2012, among certain subsidiaries, as Guarantors, of Fortegra Financial Corporation and LOTS Intermediate Co., as Borrowers, and Wells Fargo Bank, N.A., as Administrative Agent, and each of the Guaranteed Parties.	8-K	001-35009	8/7/2012	10.2
10.23	Pledge Agreement, dated August 2, 2012, by Fortegra Financial Corporation and LOTSoluntions, Inc., as Pledgors, and Wells Fargo Bank, N.A., as Administrative Agent for its benefit and the benefit of other Lenders.	8-K	001-35009	8/7/2012	10.3
10.24	Security Agreement, dated August 2, 2012, among Fortegra Financial Corporation, LOTS Intermediate Co. and certain of its subsidiaries, as Grantors, and Wells Fargo Bank, N.A., as Administrative Agent for its benefit and the benefit of the Secured Creditors.	8-K	001-35009	8/7/2012	10.4
10.24.1	Security Agreement Joinder, dated April 11, 2014, to the Security Agreement dated as of August 2, 2012, by and among Fortegra Financial Corporation and LOTS Intermediate Co., as Borrowers, certain subsidiaries of the Borrowers, as Grantors, and Wells Fargo Bank, N.A., as Administrative Agent for its benefit and the benefit of the Secured Creditors.	10-Q	001-35009	5/14/2014	10.24.1

56

EXHIBIT INDEX
		Incorporated by Reference
Exhibit Number	Description of Exhibits	Form	File Number	Date Filed	Original Exhibit Number	Filed Herewith	Furnished Herewith
10.25	Trademark Security Agreement, dated August 2, 2012, among the Fortegra Financial Corporation, LOTSolutions, Inc., Pacific Benefits Group Northwest, L.L.C., eReinsure.com, Inc., as Grantors, and Wells Fargo Bank, N.A., as Administrative Agent and Grantee, for the benefit of the Secured Creditors.	8-K	001-35009	8/7/2012	10.5
10.26*	2013 Executive Annual Incentive Plan.	10-Q	001-35009	8/14/2013	10.41
10.27*	Quarterly Incentive Plan.	10-Q	001-35009	8/14/2013	10.42
10.28*	Executive Employment and Non-Competition Agreement, dated as of March 6, 2007, by and between Life of the South Corporation and W. Dale Bullard.	S-1/A	333-169550	11/29/2010	10.25
10.29*	Amended and Restated Deferred Compensation Agreement, dated May 1, 2005, by and between Life of the South Corporation and W. Dale Bullard.	S-1/A	333-169550	10/29/2010	10.34
10.30*	Long Term Incentive Plan.	10-Q	001-35009	5/14/2014	10.30
10.31*	2014 Executive Annual Incentive Plan.	10-Q	001-35009	5/14/2014	10.31
11.1	Statement Regarding Computation of Per Share Earnings (incorporated by reference to Notes to Consolidated Financial Statements in PART I, ITEM 1 of this Quarterly Report on Form 10-Q).					X
31.1	Rule 13a-14(a)/15d-14(a) Certification of Chief Executive Officer.					X
31.2	Rule 13a-14(a)/15d-14(a) Certification of Chief Financial Officer.					X
32	Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.						X
101.INS	XBRL Instance Document.					X
101.SCH	XBRL Taxonomy Extension Schema Document.					X
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.					X
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.					X
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.					X
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.					X
*	Management contract or compensatory plan or arrangement.

57

EX-31.1

Exhibit 31.1

SECTION 302 CERTIFICATION FOR THE CHIEF EXECUTIVE OFFICER

I, Richard S. Kahlbaugh, certify that:

1. I have reviewed this Report on Form 10-Q of Fortegra Financial Corporation (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 officer(s) 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 (the Registrant's fourth fiscal quarter in the case of an annual report) 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 officer(s) 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 14, 2014	/s/ Richard S. Kahlbaugh
		Richard S. Kahlbaugh
		Chairman, President and Chief Executive Officer

EX-31.2

Exhibit 31.2

SECTION 302 CERTIFICATION FOR THE CHIEF FINANCIAL OFFICER

I, Walter P. Mascherin, certify that:

1. I have reviewed this Report on Form 10-Q of Fortegra Financial Corporation (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 officer(s) 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 (the Registrant's fourth fiscal quarter in the case of an annual report) 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 officer(s) 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 14, 2014	/s/ Walter P. Mascherin
		Walter P. Mascherin
		Executive Vice President and Chief Financial Officer

EX-32

Exhibit 32

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 Quarterly Report of Fortegra Financial Corporation on Form 10-Q for the quarterly period ended June 30, 2014, as filed with the Securities and Exchange Commission on the date hereof (the "Report"), each of the undersigned, in the capacity and on the date indicated below, hereby certifies pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to his knowledge:

1. The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operation of Fortegra Financial Corporation as of the dates and for the periods expressed in the Report.

Date:	August 14, 2014	By:	/s/ Richard S. Kahlbaugh
			Richard S. Kahlbaugh
			Chairman, President and Chief Executive Officer
Date:	August 14, 2014	By:	/s/ Walter P. Mascherin
			Walter P. Mascherin
			Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Rule 13a-14(b) of the Securities Exchange Act of 1934 and 18 U.S.C. Section 1350 has been provided to the Registrant and will be retained by the Registrant and furnished to the Securities and Exchange Commission or its staff upon request. 

This certification accompanies the Report to which it relates, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of the Registrant under the Securities Act of 1933 or the Securities Exchange Act of 1934 (whether made before or after the date of the Report), irrespective of any general incorporation language contained in such filing.

XML

Derivative Financial Instruments - Interest Rate Swap Level 3 (Tables)

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]

The following table presents the fair value (including accrued interest) and the related outstanding notional amount of the Company's single derivative instrument and indicates where the Company records each amount within its Consolidated Balance Sheets:

		At
	Balance Sheet Location	June 30, 2014			December 31, 2013
Derivative designated as cash flow hedging instrument:
Interest rate swap - notional value		$	35,000		$	35,000
Fair value of the Swap	Accrued expenses, accounts payable and other liabilities	2,619			2,930
Unrealized loss, net of tax, on the fair value of the Swap	AOCI	1,703			1,904
Variable rate of the interest rate swap		0.23		%	0.24		%
Fixed rate of the interest rate swap		3.47		%	3.47		%

Schedule of Derivative Instruments, Effect on Other Comprehensive Income (Loss) [Table Text Block]

The following table presents the pretax impact of the Swap on the Consolidated Financial Statements for the following periods:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014			2013		2014			2013
(Loss) gain recognized in AOCI on the derivative-effective portion	$	(212	)	$	532	$	(257	)	$	564
Loss reclassified from AOCI into income-effective portion	$	286		$	282	$	568		$	559
Gain (loss) recognized in income on the derivative-ineffective portion	$	—		$	—	$	—		$	—

Schedule of Interest Rate Derivatives [Table Text Block]

The following table presents the estimated amount to be reclassified to earnings from AOCI during the next 12 months. These net losses reclassified into earnings are primarily expected to increase net interest expense related to the respective hedged item.

	At
	June 30, 2014
Estimated loss to be reclassified to earnings from AOCI during the next 12 months	$	1,130

XML

Investments Investments in a unrealized loss position for <> 12 Months, current period (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2014 Securities	Dec. 31, 2013 Securities
Obligations of the U.S. Treasury and U.S. Government agencies
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	$ 6,102	$ 37,385
Unrealized Losses, Less than Twelve Months	10	672
Number of securities, Less than Twelve Months	18	67
Fair Value, Twelve months or Greater	7,950	234
Unrealized Losses,Twelve months or Greater	261	6
Number of securities,Twelve months or Greater	13	7
Total, Fair Value	14,052	37,619
Total Unrealized Losses	271	678
Total, Number of Securities	31	74
Municipal securities
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	6,852	10,080
Unrealized Losses, Less than Twelve Months	34	413
Number of securities, Less than Twelve Months	17	23
Fair Value, Twelve months or Greater	4,983	0
Unrealized Losses,Twelve months or Greater	114	0
Number of securities,Twelve months or Greater	10	0
Total, Fair Value	11,835	10,080
Total Unrealized Losses	148	413
Total, Number of Securities	27	23
Corporate securities
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	6,337	27,866
Unrealized Losses, Less than Twelve Months	25	734
Number of securities, Less than Twelve Months	14	55
Fair Value, Twelve months or Greater	10,228	7,676
Unrealized Losses,Twelve months or Greater	231	166
Number of securities,Twelve months or Greater	15	8
Total, Fair Value	16,565	35,542
Total Unrealized Losses	256	900
Total, Number of Securities	29	63
Obligations of foreign governments
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months		409
Unrealized Losses, Less than Twelve Months		2
Number of securities, Less than Twelve Months		1
Fair Value, Twelve months or Greater		0
Unrealized Losses,Twelve months or Greater		0
Number of securities,Twelve months or Greater		0
Total, Fair Value		409
Total Unrealized Losses		2
Total, Number of Securities		1
Total fixed maturity securities
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	19,291	75,740
Unrealized Losses, Less than Twelve Months	69	1,821
Number of securities, Less than Twelve Months	49	146
Fair Value, Twelve months or Greater	23,161	7,910
Unrealized Losses,Twelve months or Greater	606	172
Number of securities,Twelve months or Greater	38	15
Total, Fair Value	42,452	83,650
Total Unrealized Losses	675	1,993
Total, Number of Securities	87	161
Preferred stock - publicly traded
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	792	5,087
Unrealized Losses, Less than Twelve Months	8	887
Number of securities, Less than Twelve Months	1	9
Fair Value, Twelve months or Greater	3,981	0
Unrealized Losses,Twelve months or Greater	211	0
Number of securities,Twelve months or Greater	7	0
Total, Fair Value	4,773	5,087
Total Unrealized Losses	219	887
Total, Number of Securities	8	9
Common stock - non-publicly traded
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	0	0
Unrealized Losses, Less than Twelve Months	0	0
Number of securities, Less than Twelve Months	0	0
Fair Value, Twelve months or Greater	31	31
Unrealized Losses,Twelve months or Greater	13	13
Number of securities,Twelve months or Greater	2	2
Total, Fair Value	31	31
Total Unrealized Losses	13	13
Total, Number of Securities	2	2
Total equity securities
Schedule of Available-for-sale Securities [Line Items]
Fair Value, Less than Twelve Months	792	5,087
Unrealized Losses, Less than Twelve Months	8	887
Number of securities, Less than Twelve Months	1	9
Fair Value, Twelve months or Greater	4,012	31
Unrealized Losses,Twelve months or Greater	224	13
Number of securities,Twelve months or Greater	9	2
Total, Fair Value	4,804	5,118
Total Unrealized Losses	$ 232	$ 900
Total, Number of Securities	10	11

XML

Earnings Per Share (Details) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Numerator: (for both basic and diluted earnings per share)
Income from continuing operations before non-controlling interests	$ 3,878	$ 3,420	$ 7,637	$ 5,469
Less: net income attributable to non-controlling interests	602	185	1,463	1,003
Net income from continuing operations - net of tax	3,276	3,235	6,174	4,466
Discontinued operations - net of tax	0	1,207	0	2,469
Net income attributable to Fortegra Financial Corporation	$ 3,276	$ 4,442	$ 6,174	$ 6,935
Denominator:
Total weighted average basic common shares outstanding	19,745,115	19,540,610	19,698,444	19,548,632
Effect of dilutive stock options and restricted stock awards	695,018	982,480	765,485	1,035,319
Total weighted average diluted common shares outstanding	20,440,133	20,523,090	20,463,929	20,583,951
Earnings per share - Basic:
Net income from continuing operations - net of tax	$ 0.17	$ 0.17	$ 0.31	$ 0.23
Discontinued operations - net of tax	$ 0.00	$ 0.06	$ 0.00	$ 0.13
Net income attributable to Fortegra Financial Corporation	$ 0.17	$ 0.23	$ 0.31	$ 0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$ 0.16	$ 0.16	$ 0.30	$ 0.22
Discontinued operations - net of tax	$ 0.00	$ 0.06	$ 0.00	$ 0.12
Net income attributable to Fortegra Financial Corporation	$ 0.16	$ 0.22	$ 0.30	$ 0.34
Earnings Per Share, Diluted, Other Disclosures [Abstract]
Weighted average anti-dilutive common shares	515,768	887,046	505,207	763,909

XML

Notes Payable Debt Maturities (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014
Debt Disclosure [Abstract]
Remainder of 2014	$ 10,979
2015	0
2016	0
2017	0
2018	0
Thereafter	0
Total maturities	$ 10,979

XML

Investments Gross Proceeds from sales of available-for-sale investments (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Investments [Abstract]
Gross proceeds from sales	$ 3,303	$ 27,112	$ 3,804	$ 27,524

XML

Stock-Based Compensation Weighted Average Assumptions (Details)	6 Months Ended
	Jun. 30, 2014
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions and Methodology [Abstract]
Expected term (years)	6 years 3 months 0 days
Expected volatility	33.83%
Expected dividends	0.00%
Risk-free rate	2.19%

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Summary of Significant Accounting Policies Non-Controlling Interest (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Noncontrolling Interest [Line Items]
Non-controlling interests	$ 5,873	$ 6,033
Noncontrolling Interests [Member]
Noncontrolling Interest [Line Items]
Non-controlling interests	5,873	6,033
ProtectCell [Member] | Noncontrolling Interests [Member]
Noncontrolling Interest [Line Items]
Non-controlling interests	5,551	5,471
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	37.60%	37.60%
Southern Financial Life Insurance Company [Member] | Noncontrolling Interests [Member]
Noncontrolling Interest [Line Items]
Non-controlling interests	585	562
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	15.00%	15.00%
Creative Investigations Recovery Group, LLC [Member] | Noncontrolling Interests [Member]
Noncontrolling Interest [Line Items]
Non-controlling interests	$ (263)	$ 0
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners	100.00%	0.00%

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Reinsurance Receivables (Tables)

6 Months Ended

Jun. 30, 2014

Reinsurance Disclosures [Abstract]

Premiums Written and Earned [Table Text Block]

The following table presents the components of the reinsurance receivables:	At
	June 30, 2014		December 31, 2013
Prepaid reinsurance premiums:
Life (1)	$	49,219	$	51,355
Accident and health (1)	35,792		36,214
Property	105,228		98,650
Total	190,239		186,219
Ceded claim reserves:
Life	1,460		1,594
Accident and health	7,313		7,826
Property	16,458		12,102
Total ceded claim reserves recoverable	25,231		21,522
Other reinsurance settlements recoverable	3,604		7,343
Reinsurance receivables	$	219,074	$	215,084

⁽¹⁾ Including policyholder account balances ceded.

The following table presents the effect of reinsurance on losses and loss adjustment expenses ("LAE") incurred:

Losses and LAE incurred	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Direct and assumed	$	27,023		$	22,485		$	53,141		$	43,525
Ceded	(17,146		)	(11,881		)	(32,438		)	(22,386		)
Net losses and LAE incurred	$	9,877		$	10,604		$	20,703		$	21,139

The following table presents the effect of reinsurance on premiums written and earned:

Premiums	For the Three Months Ended June 30,												For the Six Months Ended June 30,
	2014						2013						2014						2013
	Written			Earned			Written			Earned			Written			Earned			Written			Earned
Direct and assumed	$	120,204		$	110,779		$	99,978		$	91,854		$	221,676		$	219,278		$	181,488		$	183,976
Ceded	(86,828		)	(77,616		)	(63,810		)	(58,173		)	(156,418		)	(151,187		)	(114,487		)	(117,153		)
Net	$	33,376		$	33,163		$	36,168		$	33,681		$	65,258		$	68,091		$	67,001		$	66,823

Components of Reinsurance Receivable [Table Text Block]

The following table presents the aggregate amount included in reinsurance receivables that is comprised of the three largest receivable balances from unrelated reinsurers:

	At
	June 30, 2014		December 31, 2013
Total of the three largest receivable balances from unrelated reinsurers	$	137,328	$	136,061

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Stock-Based Compensation Summary of Restricted Stock Awards (Details) (USD $)	6 Months Ended		3 Months Ended	6 Months Ended
	Jun. 30, 2014 Time-Based	Jun. 30, 2014 Performance-Based	Jun. 30, 2014 Management [Member] Time-Based	Jun. 30, 2014 Chief Executive Officer [Member] Time-Based	Jun. 30, 2014 Director [Member] Time-Based Employee
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Balance at December 31, 2013	139,680	130,629
Grants	114,944	0	9,944	30,000	75,000
Vests	(45,651)	0
Forfeitures	0	0
Balance at June 30, 2014	208,973	130,629
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Roll Forward]
Balance at December 31, 2013	$ 8.59	$ 10.20
Grants	$ 7.24	$ 0.00
Vests	$ 8.50	$ 0.00
Forfeitures	$ 0.00	$ 0.00
Balance at June 30, 2014	$ 7.87	$ 10.20
Share Based Compensation Arrangement By Share Based Payment Award, Number Of Employees Receiving Grants					5

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Notes Payable Revolving Line of Credit (Details) (Synovus Bank, Line of credit [Member], USD $)	6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Line of Credit Facility [Line Items]
Line of Credit Facility, Maximum Borrowing Capacity	$ 15,000,000	$ 15,000,000
Line of Credit Facility, Initiation Date	Oct. 09, 2013
Line of Credit Facility, Expiration Date	Apr. 30, 2017
Line of Credit Facility, Finance Amount, Percent of Eligible Receivables	90.00%
Line of Credit Facility, Minimum Availability Requirement	500,000
Financing Receivable, Gross	11,700,000
Line of Credit Facility, Financed Amount, Amount of Eligible Receivables	$ 9,400,000
London Interbank Offered Rate (LIBOR) [Member]
Line of Credit Facility [Line Items]
Debt Instrument, Basis Spread on Variable Rate	3.00%

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Fair Value of Financial Instruments Level 4 Carrying and Fair Values of Financial Instruments (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2013	Dec. 31, 2012
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	$ 10,657	$ 21,681	$ 15,590	$ 15,209
Restricted cash	12,279	17,293
Fixed Maturity Securities	144,816	131,751
Equity Securities	6,901	6,198
Notes receivable	18,297	11,920
Accounts and premiums receivable, net	15,743	18,702
Other receivables	29,941	33,409
Short-term investments	871	871
Notes payable	10,979	3,273
Preferred trust securities	35,000	35,000
Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149	51,435
Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124	24,547
Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534	55,360
Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009	409
Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47	47
Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	5,790	5,087
Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	51	51
Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,013	1,013
Reported Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	10,657	21,681
Restricted cash	12,279	17,293
Notes receivable	18,297	11,920
Accounts and premiums receivable, net	15,743	18,702
Other receivables	29,941	33,409
Short-term investments	871	871
Total Financial Assets	239,505	241,825
Notes payable	10,979	3,273
Preferred trust securities	35,000	35,000
Interest Rate Swap	2,619	2,930
Total Financial Liabilities	48,598	41,203
Reported Value Measurement [Member] | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149	51,435
Reported Value Measurement [Member] | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124	24,547
Reported Value Measurement [Member] | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534	55,360
Reported Value Measurement [Member] | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009	409
Reported Value Measurement [Member] | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	47	47
Reported Value Measurement [Member] | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	5,790	5,087
Reported Value Measurement [Member] | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	51	51
Reported Value Measurement [Member] | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	1,013	1,013
Estimate of Fair Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash and cash equivalents	10,657	21,681
Restricted cash	12,279	17,293
Notes receivable	18,297	11,920
Accounts and premiums receivable, net	15,743	18,702
Other receivables	29,941	33,409
Short-term investments	871	871
Total Financial Assets	239,505	241,825
Notes payable	10,979	3,273
Preferred trust securities	35,000	35,000
Interest Rate Swap	2,619	2,930
Total Financial Liabilities	48,598	41,203
Estimate of Fair Value Measurement [Member] | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149	51,435
Estimate of Fair Value Measurement [Member] | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124	24,547
Estimate of Fair Value Measurement [Member] | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534	55,360
Estimate of Fair Value Measurement [Member] | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009	409
Estimate of Fair Value Measurement [Member] | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	47	47
Estimate of Fair Value Measurement [Member] | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	5,790	5,087
Estimate of Fair Value Measurement [Member] | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	51	51
Estimate of Fair Value Measurement [Member] | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	$ 1,013	$ 1,013

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Investments Schedule of net investment income (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Investment Income, Net [Abstract]
Fixed income securities	$ 678	$ 675	$ 1,293	$ 1,412
Cash on hand and on deposit	0	16	0	36
Common and preferred stock dividends	98	101	196	177
Notes receivable	93	68	186	140
Other income	5	0	5	114
Investment expenses	(97)	(114)	(196)	(230)
Net investment income	$ 777	$ 746	$ 1,484	$ 1,649

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Derivative Financial Instruments - Interest Rate Swap Amount to be Reclassified from AOCI during the next 12 months (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Reclassification of Cash Flow Hedge Gain (Loss) [Abstract]
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months	$ 1,130

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Income Taxes Net Operating Loss (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Operating Loss Carryforwards [Line Items]
Operating Loss Carryforwards	$ 0.6
Operating Loss Carryforwards, Expiration Dates	Dec. 31, 2025

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Stock-Based Compensation Unrecognized Compensation related to non-vested awards (Details) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Stock Options [Member]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Unrecognized compensation cost related to non-vested awards	$ 338
Weighted-average recognition period (in years)	3 years 0 months 0 days
Restricted Stock [Member]
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Unrecognized compensation cost related to non-vested awards	$ 1,357
Weighted-average recognition period (in years)	3 years 3 months 18 days
Performance-Based
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Number of Shares	149,306
Performance-Based
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized [Abstract]
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Number of Shares	49,768

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Income Taxes Income Tax Examination (Details) (Internal Revenue Service (IRS) [Member], USD $)	6 Months Ended
	Jun. 30, 2014
Income Tax Examination [Line Items]
Income tax examination, examination completion date	February 2013
Income Tax Examination, Liability (Refund) Adjustment from Settlement with Taxing Authority	$ 57,000
Maximum [Member]
Income Tax Examination [Line Items]
Income Tax Examination, Year under Examination	2010
Minimum [Member]
Income Tax Examination [Line Items]
Income Tax Examination, Year under Examination	2009

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Stock-Based Compensation Summary of Stock Option Activity (Details) (USD $)	6 Months Ended
	Jun. 30, 2014
Time-Based
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Balance, December 31, 2013	1,930,407
Granted	15,000
Exercised	(391,389)
Canceled/forfeited	(74,176)
Balance, June 30, 2014	1,479,842
Weighted average remaining contractual term for options outstanding	3 years 6 months 0 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Balance, December 31, 2013	$ 4.22
Granted	$ 8.27
Exercised	$ 3.10
Canceled/forfeited	$ 7.90
Balance, June 30, 2014	$ 4.37
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Balance, December 31, 2013	1,806,251
Vested	3,125
Exercised	(391,389)
Canceled/forfeited	(74,176)
Balance, June 30, 2014	1,343,811
Weighted average remaining contractual term for options exercisable	3 years 0 months 0 days
Balance, December 31, 2013	$ 3.98
Vested	$ 2.81
Exercised	$ 3.10
Canceled/forfeited	$ 7.90
Balance, June 30, 2014	$ 4.02
Performance-Based
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Balance, December 31, 2013	289,306
Granted	0
Exercised	0
Canceled/forfeited	0
Balance, June 30, 2014	289,306
Weighted average remaining contractual term for options outstanding	8 years 3 months 18 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract]
Balance, December 31, 2013	$ 8.46
Granted	$ 0.00
Exercised	$ 0.00
Canceled/forfeited	$ 0.00
Balance, June 30, 2014	$ 8.46
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract]
Balance, December 31, 2013	0
Exercised	0
Canceled/forfeited	0
Balance, June 30, 2014	0
Balance, December 31, 2013	$ 0.00
Exercised	$ 0.00
Canceled/forfeited	$ 0.00
Balance, June 30, 2014	$ 0.00
Management [Member] | Time-Based
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward]
Granted	15,000

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Notes Payable Secured Credit Agreement (Details) (USD $) In Millions, unless otherwise specified	6 Months Ended
	Jun. 30, 2014
Wells Fargo Bank, N.A. credit facility, [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Initiation Date	Aug. 02, 2012
Well Fargo Bank, N. A. credit facility, 2014 amendment [Member]
Line of Credit Facility [Line Items]
Line of Credit Facility, Current Borrowing Capacity	$ 100.0
Line of Credit Facility, Initiation Date	Apr. 11, 2014
Line of Credit Facility, Expiration Date	Aug. 02, 2019
Debt Instrument, Face Amount	10.0
letters of credit, available	10.0
Line of credit, incremental amount available	$ 50.0
Debt Instrument, Basis Spread on Variable Rate	0.35%
Line of Credit Facility, Unused Capacity, Commitment Fee Percentage, Reduction in Rate	0.05%

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies Disclosure [Text Block]

Commitments and Contingencies

Commitments

The Company, in the ordinary course of normal business, may enter from time to time into certain contractual obligations or commitments. The Company's commitments, as of June 30, 2014, have not materially changed from those disclosed in the note "Commitments and Contingencies," in the Company's 2013 Form 10-K.

Contingencies

The Company is a party to claims and litigation in the normal course of its operations. Management believes that the ultimate outcome of these matters in existence at June 30, 2014 are reserved against, covered by insurance or would not have a material adverse effect on the consolidated financial condition, results of operations or cash flows of the Company.

The Company is currently a defendant in Mullins v. Southern Financial Life Insurance Co., which was filed on February 2, 2006, in the Pike Circuit Court, in the Commonwealth of Kentucky.  A class was certified on June 25, 2010.  At issue is the duration or term of coverage under certain policies.  The action alleges violations of the Consumer Protection Act and certain insurance statutes, as well as common law fraud.  The action seeks compensatory and punitive damages, attorney fees and interest.  The parties are currently involved in the merits discovery phase and discovery disputes have arisen.  Plaintiffs filed a Motion for Sanctions on April 5, 2012 in connection with the Company's efforts to locate and gather certificates and other documents from the Company's agents.  While the court did not award sanctions, it did order the Company to subpoena certain records from its agents.  In an effort to prevent the trial court from enforcing the order, the Company filed a Writ of Prohibition, which the Kentucky Court of Appeals denied on August 31, 2012.  In response, the Company filed a motion for discretionary review of the Writ of Prohibition.  The Company also filed a direct appeal of the same order, on the grounds that the order could be construed as a finding of contempt on the part of the Company.  The Court of Appeals dismissed the direct appeal on September 13, 2013, which prompted the Company to file a motion for discretionary review of the direct appeal.  The Kentucky Supreme Court denied the Writ of Prohibition on November 21, 2013, and subsequently denied the direct appeal in April 2014.  No hearings are currently scheduled and no trial date has been set.

The Company considers such litigation customary in its lines of business.  In management's opinion, based on information available at this time, the ultimate resolution of such litigation, which it is vigorously defending, should not be materially adverse to the financial position, results of operations or cash flows of the Company. It should be noted that large punitive damage awards, bearing little relation to actual damages sustained by plaintiffs, have been awarded in certain states against other companies in the credit insurance business. The Company may record loss contingencies as developments warrant, although such amounts are not reasonably estimable at this time.

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Accumulated Other Comprehensive Income Accumulated Other Comprehensive Income - Reclassification Adjustments (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Related tax (expense) benefit	$ (1,718)	$ (1,593)	$ (3,700)	$ (2,075)
Accumulated Net Unrealized Investment Gain (Loss) [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Reclassification of gains included in net income	4	1,279	5	1,286
Related tax (expense) benefit	(2)	(448)	(2)	(450)
Net of tax	2	831	3	836
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Related tax (expense) benefit	100	99	199	196
Reclassification of (losses) included in net income	(286)	(282)	(568)	(559)
Net of tax	$ (186)	$ (183)	$ (369)	$ (363)

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Fair Value of Financial Instruments Level 3 (Tables)

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value, by Balance Sheet Grouping [Table Text Block]

The carrying and fair values of financial instruments are as follows:	At
	June 30, 2014				December 31, 2013
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets:
Cash and cash equivalents	$	10,657	$	10,657	$	21,681	$	21,681
Restricted cash	12,279		12,279		17,293		17,293
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	47,149		47,149		51,435		51,435
Municipal securities	34,124		34,124		24,547		24,547
Corporate securities	62,534		62,534		55,360		55,360
Obligations of foreign governments	1,009		1,009		409		409
Equity securities:
Common stock - publicly traded	47		47		47		47
Preferred stock - publicly traded	5,790		5,790		5,087		5,087
Common stock - non-publicly traded	51		51		51		51
Preferred stock - non-publicly traded	1,013		1,013		1,013		1,013
Notes receivable	18,297		18,297		11,920		11,920
Accounts and premiums receivable, net	15,743		15,743		18,702		18,702
Other receivables	29,941		29,941		33,409		33,409
Short-term investments	871		871		871		871
Total financial assets	$	239,505	$	239,505	$	241,825	$	241,825
Financial liabilities:
Notes payable	$	10,979	$	10,979	$	3,273	$	3,273
Preferred trust securities	35,000		35,000		35,000		35,000
Interest rate swap	2,619		2,619		2,930		2,930
Total financial liabilities	$	48,598	$	48,598	$	41,203	$	41,203

Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis [Table Text Block]

The Company's financial assets and liabilities accounted for at fair value by level within the fair value hierarchy are as follows:

	At June 30, 2014
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	47,149	$	—	$	47,149	$	—
Municipal securities	34,124		—		34,124		—
Corporate securities	62,534		—		62,534		—
Obligations of foreign governments	1,009		—		1,009		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,790		5,790		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total assets	$	152,588	$	6,708	$	144,816	$	1,064
Financial Liabilities:
Interest rate swap	$	2,619	$	—	$	2,619	$	—

	At December 31, 2013
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,435	$	—	$	51,435	$	—
Municipal securities	24,547		—		24,547		—
Corporate securities	55,360		—		55,360		—
Obligations of foreign governments	409		—		409		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,087		5,087		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total Assets	$	138,820	$	6,005	$	131,751	$	1,064
Financial Liabilities:
Interest rate swap	$	2,930	$	—	$	2,930	$	—

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

The following table presents the changes in Level 3 assets measured at fair value:	For the Six Months Ended June 30,
	2014		2013
Beginning balance, January 1,	$	1,064	$	1,123
Total investment gains or losses (realized/unrealized):
Included in other comprehensive (loss)	—		(25		)
Transfers (out of) Level 3	—		(27		)
Ending balance, June 30,	$	1,064	$	1,071

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Derivative Financial Instruments - Interest Rate Swap Swap impact on the Consolidated Financial Statements (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized (loss) gain on interest rate swap	$ (212)	$ 532	$ (257)	$ 564
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax	(286)	(282)	(568)	(559)
Interest Rate Swap [Member] | Cash Flow Hedging [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Unrealized (loss) gain on interest rate swap	(212)	532	(257)	564
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI on Derivatives, before Tax	286	282	568	559
Derivative Instruments, Gain (Loss) Recognized in Income, Ineffective Portion and Amount Excluded from Effectiveness Testing, Net	$ 0	$ 0	$ 0	$ 0

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Variable Interest Entity (Tables)

6 Months Ended

Jun. 30, 2014

Variable Interest Entity, Not Primary Beneficiary, Disclosures [Abstract]

Schedule of Variable Interest Entities [Table Text Block]

The Company's maximum exposure to further loss in the VIE is limited to the balance of the short term funding.

	At
	June 30, 2014
The Company's maximum exposure to loss in the VIE	$	184

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Investments Restricted Investments (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Investments [Abstract]
Fair value of restricted investments for special deposits required by state insurance departments	$ 10,307	$ 10,339
Fair value of restricted investments in trust pursuant to reinsurance agreements	5,661	6,134
Total fair value of restricted investments	$ 15,968	$ 16,473

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Other Intangible Assets Future Amortization Expense (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Finite-Lived Intangible Assets, Amortization Expense, Maturity Schedule [Abstract]
Remainder of 2014	$ 2,635
2015	5,115
2016	4,868
2017	3,648
2018	2,230
Thereafter	9,903
Total	$ 28,399	$ 31,034

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Reinsurance Receivables Reinsurer concentration of Credit Risk (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Concentration Risk [Line Items]
Total of the three largest receivable balances from unrelated reinsurers	$ 219,074	$ 215,084
Customer Concentration Risk [Member]
Concentration Risk [Line Items]
Total of the three largest receivable balances from unrelated reinsurers	$ 137,328	$ 136,061

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Summary of Significant Accounting Policies Discontinued Operations (Details) (Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member])	12 Months Ended
	Dec. 31, 2013
Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale of Stock, Percentage of Ownership before Transaction	100.00%

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Basis of Presentation

6 Months Ended

Jun. 30, 2014

Basis of Presentation and Significant Accounting Policies [Abstract]

Basis of Accounting [Text Block]

Basis of Presentation

The accompanying unaudited interim Consolidated Financial Statements of Fortegra have been prepared in conformity with generally accepted accounting principles in the United States of America ("U.S. GAAP") promulgated by the Financial Accounting Standards Board ("FASB") through the Accounting Standards Codification ("ASC") for interim financial information, and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the disclosures and footnotes required by U.S. GAAP for complete financial statements and should be read in conjunction with the Company's 2013 Form 10-K.

The interim consolidated financial statements in this Form 10-Q have not been audited. In the opinion of management, the accompanying unaudited interim financial information reflects all adjustments, including normal recurring adjustments necessary to present fairly Fortegra's financial position, results of operations, comprehensive income and cash flows for each of the interim periods presented. The results of operations for the three and the six months ended June 30, 2014 are not necessarily indicative of the results that may be expected for the full year ending on December 31, 2014.

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Deferred Policy Acquisition Costs (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Insurance Related [Member]
Deferred Policy Acquisition Cost, Amortization Expense [Abstract]
Deferred Policy Acquisition Cost, Amortization Expense	$ 15,678	$ 16,147	$ 32,920	$ 32,438
Non Insurance Related [Member]
Deferred Policy Acquisition Cost, Amortization Expense [Abstract]
Deferred Policy Acquisition Cost, Amortization Expense	$ 17,278	$ 20,971	$ 35,292	$ 35,884

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Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions Level 3 (Tables)

6 Months Ended

Jun. 30, 2014

Insurance [Abstract]

Statutory Accounting Practices Disclosure [Table Text Block]

The following table presents the dividends paid to the Company by its insurance company subsidiaries for the following periods:

	For the Six Months Ended June 30,		For the Twelve Months Ended December 31,
	2014		2013
Ordinary dividends	$	—	$	2,383
Extraordinary dividends	—		—
Total dividends	$	—	$	2,383

The following table presents the combined statutory capital and surplus of the Company's insurance company subsidiaries, the required minimum statutory capital and surplus, as required by the laws of the states in which they are domiciled and the combined amount available for ordinary dividends of the Company's insurance company subsidiaries for the following periods:

	At
	June 30, 2014		December 31, 2013
Combined statutory capital and surplus of the Company's insurance company subsidiaries	$	79,757	$	69,269
Required minimum statutory capital and surplus	$	17,200	$	17,200
Amount available for ordinary dividends of the Company's insurance company subsidiaries	$	4,244	$	3,989

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Table Text Block]

The following table shows the amount outstanding and the percentage of non-controlling interest by entity:

	At
	June 30, 2014					December 31, 2013
	Amount			Percent		Amount		Percent
ProtectCELL	$	5,551		37.6	%	$	5,471	37.6	%
SFLAC	585			15.0	%	562		15.0	%
CIRG	(263		)	100.0	%	—		—	%
Total non-controlling interests	$	5,873				$	6,033

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Consolidation, Policy [Policy Text Block]

Principles of Consolidation

The Consolidated Financial Statements include the accounts of Fortegra Financial Corporation and its majority-owned and controlled subsidiaries. The Company eliminates all material intercompany account balances and transactions.

Non-Controlling Interests

The third-party ownership of the common stock of SFLAC and of the ownership interests of ProtectCELL, which is treated as a partnership for income tax purposes, have been reflected as non-controlling interests on the Consolidated Balance Sheets. In addition, the Company's non-controlling interest includes the amount for the consolidation of the variable interest entity ("VIE"), Creative Investigations Recovery Group, LLC ("CIRG"). The following table shows the amount outstanding and the percentage of non-controlling interest by entity:

	At
	June 30, 2014					December 31, 2013
	Amount			Percent		Amount		Percent
ProtectCELL	$	5,551		37.6	%	$	5,471	37.6	%
SFLAC	585			15.0	%	562		15.0	%
CIRG	(263		)	100.0	%	—		—	%
Total non-controlling interests	$	5,873				$	6,033

Income (loss) attributable to these non-controlling interests are presented on the Consolidated Statements of Income as net income (loss) attributable to non-controlling interests and on the Consolidated Statements of Comprehensive Income as comprehensive income (loss) attributable to non-controlling interests.

Segment Reporting, Policy [Policy Text Block]

Reportable Segment

The Company reports operating results and financial data in one operating and one reportable segment, Protection Products and Services. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker. The financial results of the Company's single segment are equal to the net income from continuing operations reported in the Consolidated Statements of Income for all periods presented.

Discontinued Operations, Policy [Policy Text Block]

Discontinued Operations

The results of operations of a business of the Company that either has been disposed of or is classified as held-for-sale are reported in discontinued operations if: 1) the operations and cash flows of the component have been or will be eliminated from the ongoing operations of the Company as a result of the disposal transaction; and 2) the Company will not have any significant continuing involvement in the operations of the component after the disposal transaction. The Company presents the operations of business(es) that meet the criteria for reporting as discontinued operations, and retrospectively reclassifies operating results for all prior periods presented.

On December 31, 2013, the Company completed the sale of its 100% ownership of Bliss and Glennon and eReinsure.com ("eReinsure"). The operating results of these businesses are presented in the line "Income from discontinued operations - net of tax" in the Consolidated Statements of Income for the three and the six months ended June 30, 2013. In accordance with accounting guidance, the Company has elected to not separately disclose the cash flows related to the Bliss and Glennon and eReinsure discontinued operations. In addition, certain assets and liabilities associated with the disposition of Bliss and Glennon and eReinsure that are still subject to final settlement are included in the line items "Assets of discontinued operations" and "Liabilities of discontinued operations," in the Consolidated Balance Sheet at June 30, 2014 and at December 31, 2013. See the Note, "Divestitures," for more information on discontinued operations.

Comprehensive Income, Policy [Policy Text Block]

Comprehensive Income (Loss)

Comprehensive income (loss) includes net income and other items of comprehensive income (loss). These other items are generally comprised of unrealized gains and losses on investment securities classified as available-for-sale and unrealized gains and losses on the interest rate swap, net of the related tax effects.

Use of Estimates, Policy [Policy Text Block]

Use of Estimates

Preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Comparability of Prior Year Financial Data, Policy [Policy Text Block]

Reclassifications

Certain items in prior period consolidated financial statements were reclassified to conform to the current period presentation, which had no impact on net income, comprehensive income or loss, net cash provided by operating activities or stockholders' equity.

Subsequent Events, Policy [Policy Text Block]

Subsequent Events

The Company reviewed all material events subsequent to June 30, 2014 that occurred up to the date on which the Company filed its Consolidated Financial Statements, to determine whether any event required recognition or disclosure in these Consolidated Financial Statements and/or disclosure in the notes thereto. For more information, please see the Note, "Subsequent Events."

New Accounting Pronouncements, Policy [Policy Text Block]

Recently Adopted Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update ("ASU") No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, to clarify the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU No. 2013-11 is effective prospectively for years and interim periods within those years beginning after December 15, 2013. The adoption of ASU No. 2013-11 did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Recently Issued Accounting Pronouncements

In June 2014, the FASB issued ASU No. 2014-12, Compensation - Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period. ASU No. 2014-12 requires that awards which contain a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. ASU No. 2014-12 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. ASU No. 2014-12 maybe applied using two methods: a) prospectively to all awards granted or modified after the effective date or b) retrospectively to all awards with performance targets outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The Company is currently reviewing ASU No. 2014-12 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  ASU No. 2014-09 is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  ASU No. 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  ASU No. 2014-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods, using either the full retrospective adoption or the modified retrospective adoption. ASU No. 2014-09 does not permit early adoption. The Company is currently reviewing ASU No. 2014-09 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU No. 2014-08 requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations and also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. ASU No. 2014-08 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014 (early adoption is permitted only for disposals that have not been previously reported). The adoption of ASU No. 2014-08 is not expected to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

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Investments Realized investment gains, losses and OTTI (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014 Securities	Jun. 30, 2013	Jun. 30, 2014 Securities	Jun. 30, 2013
Realized Investment Gains (Losses) [Abstract]
Gross realized gains	$ 4	$ 1,355	$ 5	$ 1,362
Gross realized losses	0	(75)	0	(75)
Total net gains from investment sales	4	1,280	5	1,287
Impairment write-downs (other-than-temporary impairments)	0	0	0	0
Net realized investment gains	$ 4	$ 1,280	$ 5	$ 1,287
Number of Securities with Other Than Temporary Impairment Losses, Investments	0		0

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Related Party Transactions (Tables)

6 Months Ended

Jun. 30, 2014

Related Party Transactions [Abstract]

Schedule of Related Party Transactions [Table Text Block]

The following table presents the amounts recorded on the Company's Consolidated Statements of Income resulting from related party transactions:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income recorded by ProtectCELL for protection plans sold	$	—	$	595	$	307	$	1,102
Income recorded for the sale of the Company's insurance-related products under the Marketing Agreement	315		268		632		268
Total related party income recorded by the Company	$	315	$	863	$	939	$	1,370
Interest income recorded on the High Pointe note receivable	$	—	$	—	$	—	$	21
Lease expense paid to High Pointe	$	103	$	103	$	207	$	197
Lease expense paid to Source	—		29		—		58
Total related party lease expense	$	103	$	132	$	207	$	255
Commissions paid by ProtectCELL for protection plans sold	$	—	$	246	$	122	$	451
Claims paid on the Company's insurance-related products under the Marketing Agreement	$	39	$	—	$	62	$	—
The following table presents the amounts recorded on the Company's Consolidated Balance Sheets from related party transactions:
					At
					June 30, 2014		December 31, 2013
Accounts receivable from related parties					$	—	$	113

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Earnings Per Share (Tables)

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

The following table details the earnings per share calculation:	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Numerator: (for both basic and diluted earnings per share)
Income from continuing operations before non-controlling interests	$	3,878	$	3,420	$	7,637	$	5,469
Less: net income attributable to non-controlling interests	602		185		1,463		1,003
Net income from continuing operations - net of tax	3,276		3,235		6,174		4,466
Discontinued operations - net of tax	—		1,207		—		2,469
Net income attributable to Fortegra Financial Corporation	$	3,276	$	4,442	$	6,174	$	6,935
Denominator:
Total weighted average basic common shares outstanding	19,745,115		19,540,610		19,698,444		19,548,632
Effect of dilutive stock options and restricted stock awards	695,018		982,480		765,485		1,035,319
Total weighted average diluted common shares outstanding	20,440,133		20,523,090		20,463,929		20,583,951
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.17	$	0.17	$	0.31	$	0.23
Discontinued operations - net of tax	—		0.06		—		0.13
Net income attributable to Fortegra Financial Corporation	$	0.17	$	0.23	$	0.31	$	0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.16	$	0.16	$	0.30	$	0.22
Discontinued operations - net of tax	—		0.06		—		0.12
Net income attributable to Fortegra Financial Corporation	$	0.16	$	0.22	$	0.30	$	0.34
Weighted average anti-dilutive common shares	515,768		887,046		505,207		763,909

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Accumulated Other Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2014

Equity [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block]

The following table presents the activity in accumulated other comprehensive income (loss) ("AOCI") for the following periods:

	For the Six Months Ended June 30, 2014
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2013, net of tax	$	(1,761	)	$	(1,904	)	$	(3,665	)
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)	2,943			(257		)	2,686
Income tax (expense) benefit	(1,030		)	89			(941		)
Other comprehensive income (loss) before reclassifications, net of tax	1,913			(168		)	1,745
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(5		)	568			563
Income tax expense (benefit)	2			(199		)	(197		)
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(3		)	369			366
Current period other comprehensive income, net of tax	1,910			201			2,111
Less: other comprehensive income attributable to non-controlling interest	6			—			6
Balance at June 30, 2014, net of tax	$	143		$	(1,703	)	$	(1,560	)
	For the Six Months Ended June 30, 2013
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2012, net of tax	$	2,189		$	(2,820	)	$	(631	)
Other comprehensive income (loss) before reclassifications:
Pre-tax (loss) income	(3,274		)	564			(2,710		)
Income tax benefit (expense)	1,146			(197		)	949
Other comprehensive (loss) income before reclassifications, net of tax	(2,128		)	367			(1,761		)
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(1,286		)	559			(727		)
Income tax expense (benefit)	450			(196		)	254
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(836		)	363			(473		)
Current period other comprehensive (loss) income, net of tax	(2,964		)	730			(2,234		)
Less: other comprehensive (loss) attributable to non-controlling interest	(11		)	—			(11		)
Balance at June 30, 2013, net of tax	$	(764	)	$	(2,090	)	$	(2,854	)

Schedule of Amounts Recognized in Other Comprehensive Income (Loss) [Table Text Block]

The following table presents the reclassifications out of AOCI for the following periods:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013			Consolidated Statement of Income Location
Unrealized gains (losses) on available-for-sale securities:
Reclassification of gains included in net income	$	4		$	1,279		$	5		$	1,286		Net realized investment gains (losses)
Related tax (expense)	(2		)	(448		)	(2		)	(450		)	Income taxes
Net of tax	$	2		$	831		$	3		$	836		Net Income
Unrealized gain (loss) on interest rate swap:
Reclassification of (losses) included in net income	$	(286	)	$	(282	)	$	(568	)	$	(559	)	Interest expense
Related tax benefit	100			99			199			196			Income taxes
Net of tax	$	(186	)	$	(183	)	$	(369	)	$	(363	)	Net Income

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Nature of Operations

6 Months Ended

Jun. 30, 2014

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Nature of Operations [Text Block]

Nature of Operations

Fortegra Financial Corporation (references in this Form 10-Q to "Fortegra Financial," "Fortegra," "we," "us," "the Company" or similar terms refer to Fortegra Financial Corporation and its subsidiaries), traded on the New York Stock Exchange under the symbol: FRF, is an insurance services company headquartered in Jacksonville, Florida. Fortegra offers a wide array of revenue enhancing products, including payment protection products, motor club memberships, service contracts, device and warranty services, and administration services, to our business partners, including insurance companies, retailers, dealers, insurance brokers and agents and financial services companies. In 2008, the Company changed its name from Life of the South Corporation to Fortegra Financial Corporation. The Company incorporated in the State of Georgia in 1981 and re-incorporated in the State of Delaware in 2010. The Company generates most of its business through networks of small to mid-sized community and regional banks, small loan companies, independent wireless retailers and automobile dealerships. The Company's subsidiaries (owned 100% directly or indirectly by the Company, unless otherwise noted below) at June 30, 2014, are as follows:

• 4Warranty Corporation ("4Warranty")

• Auto Knight Motor Club, Inc. ("Auto Knight")

• Continental Car Club, Inc. ("Continental")

• CRC Reassurance Company, Ltd. ("CRC") *

• Digital Leash, LLC, d/b/a ProtectCELL ("ProtectCELL"), 62.4% owned

• Insurance Company of the South ("ICOTS") *

• Life of the South Insurance Company ("LOTS") * and its subsidiary, Bankers Life of Louisiana ("Bankers Life") *

• LOTS Intermediate Co. ("LOTS IM")

• LOTS Reassurance Company ("LOTS RE") *

• LOTSolutions, Inc.

• Lyndon Southern Insurance Company ("Lyndon Southern") *

• Pacific Benefits Group Northwest, LLC ("PBG")

• Response Indemnity Company of California ("RICC") *

• South Bay Acceptance Corporation ("South Bay")

• South Bay Financial Services, LLC ("SBFS")

• Southern Financial Life Insurance Company ("SFLAC"), 85.0% owned *

• United Motor Club of America, Inc. ("United")

* = Insurance company subsidiary

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Investments (Tables)

6 Months Ended

Jun. 30, 2014

Investments [Abstract]

Available-for-sale Securities [Table Text Block]

	At December 31, 2013
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,971	$	142	$	(678	)	$	51,435
Municipal securities	24,856		104		(413		)	24,547
Corporate securities	56,050		210		(900		)	55,360
Obligations of foreign governments	411		—		(2		)	409
Total fixed maturity securities	$	133,288	$	456	$	(1,993	)	$	131,751
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		—		(887		)	5,087
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	17	$	(900	)	$	6,198

The following table presents the Company's available-for-sale fixed maturity and equity securities:

	At June 30, 2014
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	46,951	$	469	$	(271	)	$	47,149
Municipal securities	34,088		184		(148		)	34,124
Corporate securities	62,086		704		(256		)	62,534
Obligations of foreign governments	993		16		—			1,009
Total fixed maturity securities	$	144,118	$	1,373	$	(675	)	$	144,816
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		35		(219		)	5,790
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	52	$	(232	)	$	6,901

Restricted investments [Table Text Block]

The following table presents the Company's restricted investments included in the Company's available-for-sale fixed maturity securities:

	At
	June 30, 2014		December 31, 2013
Fair value of restricted investments for special deposits required by state insurance departments	$	10,307	$	10,339
Fair value of restricted investments in trust pursuant to reinsurance agreements	5,661		6,134
Total fair value of restricted investments	$	15,968	$	16,473

Investments Classified by Contractual Maturity Date [Table Text Block]

The following table presents the amortized cost and fair value of fixed maturity securities by contractual maturity. Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

	At June 30, 2014				At December 31, 2013
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	9,775	$	9,834	$	18,766	$	18,771
Due after one year through five years	67,865		68,259		69,380		69,355
Due after five years through ten years	43,577		43,636		22,622		21,731
Due after ten years	22,901		23,087		22,520		21,894
Total fixed maturity securities	$	144,118	$	144,816	$	133,288	$	131,751

Schedule of Unrealized Loss on Investments [Table Text Block]

The following tables present information on unrealized losses on investment securities that have been in an unrealized loss position for less than twelve months, and twelve months or greater:

	At June 30, 2014
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	6,102	$	10	18	$	7,950	$	261	13	$	14,052	$	271	31
Municipal securities	6,852		34		17	4,983		114		10	11,835		148		27
Corporate securities	6,337		25		14	10,228		231		15	16,565		256		29
Total fixed maturity securities	$	19,291	$	69	49	$	23,161	$	606	38	$	42,452	$	675	87
Preferred stock - publicly traded	792		8		1	3,981		211		7	4,773		219		8
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	792	$	8	1	$	4,012	$	224	9	$	4,804	$	232	10

	At December 31, 2013
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	37,385	$	672	67	$	234	$	6	7	$	37,619	$	678	74
Municipal securities	10,080		413		23	—		—		—	10,080		413		23
Corporate securities	27,866		734		55	7,676		166		8	35,542		900		63
Obligations of foreign governments	409		2		1	—		—		—	409		2		1
Total fixed maturity securities	$	75,740	$	1,821	146	$	7,910	$	172	15	$	83,650	$	1,993	161
Preferred stock - publicly traded	5,087		887		9	—		—		—	5,087		887		9
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	5,087	$	887	9	$	31	$	13	2	$	5,118	$	900	11

Gross proceeds from the sale of available-for-sale securities [Table Text Block]

The following table presents the total gross proceeds from the sale of available-for-sale investment securities:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Gross proceeds from sales	$	3,303	$	27,112	$	3,804	$	27,524

Gain (Loss) on Investments [Table Text Block]

The following table presents the gross realized gains and gross realized losses for both fixed maturity and equity securities and realized losses for other-than-temporary impairments for available-for-sale investment securities:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014		2013			2014		2013
Gross realized gains	$	4	$	1,355		$	5	$	1,362
Gross realized losses	—		(75		)	—		(75		)
Total net gains from investment sales	4		1,280			5		1,287
Impairment write-downs (other-than-temporary impairments)	—		—			—		—
Net realized investment gains	$	4	$	1,280		$	5	$	1,287

Investment Income [Table Text Block]

The following table presents the components of net investment income:	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Fixed income securities	$	678		$	675		$	1,293		$	1,412
Cash on hand and on deposit	—			16			—			36
Common and preferred stock dividends	98			101			196			177
Notes receivable	93			68			186			140
Other income	5			—			5			114
Investment expenses	(97		)	(114		)	(196		)	(230		)
Net investment income	$	777		$	746		$	1,484		$	1,649

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Income Taxes Provision for income taxes (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Tax Disclosure [Abstract]
Income taxes - continuing operations	$ 1,718	$ 1,593	$ 3,700	$ 2,075
Income taxes - discontinued operations	0	833	0	1,705
Income taxes	$ 1,718	$ 2,426	$ 3,700	$ 3,780

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Stock-Based Compensation (Tables)

6 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of Share-based Compensation, Stock Options, Activity [Table Text Block]

The following table presents the Company's time-based and performance-based stock option activity for the current period:

	Time-Based								Performance-Based
	Options Outstanding		Weighted Average Exercise Price (in dollars per share)		Options Exercisable		Weighted Average Exercise Price (in dollars per share)		Options Outstanding	Weighted Average Exercise Price (in dollars per share)		Options Exercisable	Weighted Average Exercise Price (in dollars per share)
Balance, December 31, 2013	1,930,407		$	4.22	1,806,251		$	3.98	289,306	$	8.46	—	$	—
Granted	15,000		8.27		—		—		—	—		—	—
Vested	—		—		3,125		2.81		—	—		—	—
Exercised	(391,389	)	3.10		(391,389	)	3.10		—	—		—	—
Canceled/forfeited	(74,176	)	7.90		(74,176	)	7.90		—	—		—	—
Balance, June 30, 2014	1,479,842		$	4.37	1,343,811		$	4.02	289,306	$	8.46	—	$	—
Weighted average remaining contractual term at June 30, 2014 (in years)	3.5				3.0				8.3			—

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

The following table presents the weighted average assumptions used to estimate the fair values of all stock options granted during the six months ended June 30, 2014:

	Assumptions
Expected term (years)	6.25
Expected volatility	33.83	%
Expected dividends	—	%
Risk-free rate	2.19	%

Schedule of Share-based Compensation, Restricted Stock Units Award Activity [Table Text Block]

The following table presents the Company's time-based and performance-based restricted stock award activity for the current period:

	Time-Based				Performance-Based
	Shares		Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Balance at December 31, 2013	139,680		$	8.59	130,629	$	10.20
Grants	114,944		7.24		—	—
Vests	(45,651	)	8.50		—	—
Forfeitures	—		—		—	—
Balance at June 30, 2014	208,973		$	7.87	130,629	$	10.20

Schedule of Compensation Cost for Share-based Payment Arrangements, Allocation of Share-based Compensation Costs by Plan [Table Text Block]

The following table presents the total time-based and performance-based stock-based compensation expense and the related income tax benefit recognized on the Consolidated Statements of Income:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Personnel costs	$	156		$	204		$	315		$	388
Other operating expenses	135			124			266			242
Income tax benefit	(111		)	(126		)	(222		)	(241		)
Net stock-based compensation expense	$	180		$	202		$	359		$	389

Additional information on total non-vested stock-based compensation is as follows:	At June 30, 2014
	Stock Options		Restricted Stock Awards
Unrecognized compensation cost related to non-vested awards	$	338	$	1,357
Weighted-average recognition period (in years)	3.0		3.3

Schedule of Unrecognized Compensation Cost, Nonvested Awards [Table Text Block]

Additional information on total non-vested stock-based compensation is as follows:	At June 30, 2014
	Stock Options		Restricted Stock Awards
Unrecognized compensation cost related to non-vested awards	$	338	$	1,357
Weighted-average recognition period (in years)	3.0		3.3

Schedule of Share-based Compensation, Employee Stock Purchase Plan, Activity [Table Text Block]

The following table presents the information related to the Company's ESPP for the six-month offering period ending on:

	June 30, 2014		June 30, 2013
Common stock issued under the ESPP (in shares)	18,642		26,019
Weighted-average purchase price per share by participant in the ESPP	$	6.04	$	5.83
Total cash proceeds received from the issuance of common shares under the ESPP	$	113	$	152
ESPP compensation costs recognized	$	32	$	46

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Investments by Maturity (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Schedule of Available-for-sale Securities [Line Items]
Due in one year or less, Amortized Cost	$ 9,775	$ 18,766
Due after one year through five years, Amortized Cost	67,865	69,380
Due after five years through ten years, Amortized Cost	43,577	22,622
Due after ten years, Amortized Cost	22,901	22,520
Total Fixed Maturity Securities, Amortized Cost	144,118	133,288
Due in one year or less, Fair Value	9,834	18,771
Due after one year through five years, Fair Value	68,259	69,355
Due after five years through ten years, Fair Value	43,636	21,731
Due after ten years, Fair Value	23,087	21,894
Total Fixed Maturity Securities, Fair Value	$ 144,816	$ 131,751

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Notes Payable Covenants (Details)								6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013 Bankers Life of Louisiana [Member]	Dec. 31, 2013 Southern Financial Life Insurance Company [Member]	Dec. 31, 2013 Insurance Company of the South [Member]	Dec. 31, 2013 Lyndon Southern Insurance Company [Member]	Dec. 31, 2013 Life of the South Insurance Company [Member]	Dec. 31, 2013 Response Indemnity Company of California [Member]	Jun. 30, 2014 Maximum [Member]	Jun. 30, 2014 Minimum [Member]	Jun. 30, 2014 Minimum [Member] Bankers Life of Louisiana [Member]	Jun. 30, 2014 Minimum [Member] Southern Financial Life Insurance Company [Member]	Jun. 30, 2014 Minimum [Member] Insurance Company of the South [Member]	Jun. 30, 2014 Minimum [Member] Lyndon Southern Insurance Company [Member]	Jun. 30, 2014 Minimum [Member] Life of the South Insurance Company [Member]	Jun. 30, 2014 Minimum [Member] Response Indemnity Company of California [Member]
Debt Instrument [Line Items]
Total Leverage Ratio - Well Fargo Bank, credit facility	0.82
Fixed Charge Coverage Ratio-Wells Fargo, credit facility	4.17
Reinsurance Ratio-Wells Fargo Bank, credit facility	69.00%
RBC Ratio		435.00%	2096.00%	366.00%	305.00%	430.00%	39754.00%
Debt Instrument, Covenant Compliance, Total Leverage Ratio								3.25
Debt Instrument, Covenant Compliance, Fixed Charge Coverage Ratio									2.00
Debt Instrument, Covenant Compliance, Reinsurance Ratio									50.00%
Debt Instrument, Covenant Compliance, Risk Based Capital Ratio										250.00%	250.00%	250.00%	250.00%	250.00%	250.00%

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Investments:
Fixed maturity securities available-for-sale, at fair value (amortized cost of $144,118 at June 30, 2014 and $133,288 at December 31, 2013)	$ 144,816	$ 131,751
Equity securities available-for-sale, at fair value (cost of $7,081 at June 30, 2014 and December 31, 2013, respectively)	6,901	6,198
Short-term investments	871	871
Total investments	152,588	138,820
Cash and cash equivalents	10,657	21,681
Restricted cash	12,279	17,293
Accrued investment income	1,339	1,175
Notes receivable, net	18,297	11,920
Accounts and premiums receivable, net	15,743	18,702
Other receivables	29,941	33,409
Reinsurance receivables	219,074	215,084
Deferred acquisition costs	67,841	78,042
Property and equipment, net	13,133	14,332
Goodwill	73,701	73,701
Other intangible assets, net	46,538	49,173
Other assets	7,820	6,307
Assets of discontinued operations	491	791
Total assets	669,442	680,430
Liabilities:
Unpaid claims	38,549	34,732
Unearned premiums	258,778	256,380
Policyholder account balances	22,081	23,486
Accrued expenses, accounts payable and other liabilities	46,290	53,035
Income taxes payable	2,722	2,842
Deferred revenue	59,508	76,927
Notes payable	10,979	3,273
Preferred trust securities	35,000	35,000
Deferred income taxes, net	19,288	19,659
Liabilities of discontinued operations	908	8,603
Total liabilities	494,103	513,937
Commitments and Contingencies (Note 17)
Stockholders' Equity:
Preferred stock, par value $0.01; 10,000,000 shares authorized; none issued	0	0
Common stock, par value $0.01; 150,000,000 shares authorized; 21,287,525 and 20,912,853 shares issued at June 30, 2014 and December 31, 2013, respectively, including shares in treasury	213	209
Treasury stock, at cost; 1,224,182 shares at June 30, 2014 and December 31, 2013	(8,014)	(8,014)
Additional paid-in capital	100,121	99,398
Accumulated other comprehensive loss, net of tax	(1,560)	(3,665)
Retained earnings	78,706	72,532
Stockholders' equity before non-controlling interests	169,466	160,460
Non-controlling interests	5,873	6,033
Total stockholders' equity	175,339	166,493
Total liabilities and stockholders' equity	$ 669,442	$ 680,430

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Nature of Operations (Details)	6 Months Ended
	Jun. 30, 2014
ProtectCell [Member]
Subsidiary or Equity Method Investee [Line Items]
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions	62.40%
Southern Financial Life Insurance Company [Member]
Subsidiary or Equity Method Investee [Line Items]
Subsidiary or Equity Method Investee, Cumulative Percentage Ownership after All Transactions	85.00%

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Consolidated Statements of Stockholders' Equity (USD $) In Thousands, except Share data, unless otherwise specified	Total	Common stock	Treasury Stock [Member]	Additional Paid-in Capital [Member]	Accumulated Other Comprehensive Income (Loss) [Member]	Retained Earnings [Member]	Noncontrolling Interests [Member]
Balance, at Dec. 31, 2013	$ 166,493	$ 209	$ (8,014)	$ 99,398	$ (3,665)	$ 72,532	$ 6,033
Balance, Shares at Dec. 31, 2013	20,912,853	20,912,853
Treasury Stock, Shares at Dec. 31, 2013	(1,224,182)		(1,224,182)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	7,637					6,174	1,463
Other comprehensive income, net of tax					2,105
Other comprehensive income, net of tax					6		6
Other comprehensive income, net of tax	2,111				2,111
Distributions to non-controlling interest partners	(1,380)						(1,380)
Non-controlling interest attributable to the consolidation of Creative Investigations Recovery Group, LLC	(249)						(249)
Stock-based compensation, shares		114,944
Stock-based compensation	613	2		611
Direct stock awards to employees, shares		264
Direct stock awards to employees, value	1	0		1
Stock issued for the Employee Stock Purchase Plan, shares		18,642
Stock issued for the Employee Stock Purchase Plan, value	113	0		113
Options exercised, net of shares surrendered, shares		240,822
Options exercised, net of shares surrendered, value	0	(2)		(2)
Balance, at Jun. 30, 2014	$ 175,339	$ 213	$ (8,014)	$ 100,121	$ (1,560)	$ 78,706	$ 5,873
Balance, Shares at Jun. 30, 2014	21,287,525	21,287,525
Treasury Stock, Shares at Jun. 30, 2014	(1,224,182)		(1,224,182)

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Subsequent Events Subsequent Events (Details) (Subsequent Event [Member], USD $) In Millions, unless otherwise specified	0 Months Ended
	Aug. 11, 2014	Aug. 12, 2014
Subsequent Event [Line Items]
Subsequent Event, Date	Aug. 11, 2014
Fortegra Financial Corporation [Member]
Subsequent Event [Line Items]
Business Combination, Consideration Transferred	$ 218.0
Business Combination, Ownership Interest held by Majority Shareholder, Percent		62.00%

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Reinsurance Receivables Losses and LAE Incurred (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Reinsurance Disclosures [Abstract]
Direct and assumed	$ 27,023	$ 22,485	$ 53,141	$ 43,525
Ceded	(17,146)	(11,881)	(32,438)	(22,386)
Net losses and LAE incurred	$ 9,877	$ 10,604	$ 20,703	$ 21,139

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Divestitures Discontinued Operations (Tables)

6 Months Ended

Jun. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Schedule of Disposal Groups, Including Discontinued Operations, Income Statement, Balance Sheet and Additional Disclosures [Table Text Block]

The following table presents the assets and liabilities of the discontinued operations included on the Consolidated Balance Sheets:

	At
	June 30, 2014		December 31, 2013
Assets:
Other receivables (1)	$	491	$	791
Assets of discontinued operations	$	491	$	791
Liabilities:
Accrued expenses, accounts payable and other liabilities	$	908	$	2,708
Income taxes payable	—		5,895
Liabilities of discontinued operations	$	908	$	8,603

⁽¹⁾ - In June 2014, $0.3 million was reclassified between liabilities and assets associated with discontinued operations, based on revised estimates of working capital and payment obligations.

The following table presents the amounts related to the Company's discontinued operations in the Consolidated Statements of Income for the following period:

	For the Three Months Ended		For the Six Months Ended
	June 30, 2013		June 30, 2013
Income from discontinued operations:
Revenues:
Brokerage commissions and fees	$	9,891	$	19,622
Net investment income	6		12
Other income	16		16
Total revenues	9,913		19,650
Expenses:
Personnel costs	5,086		10,135
Other operating expenses	1,546		2,888
Depreciation and amortization	162		303
Amortization of intangibles	481		961
Interest expense	598		1,189
Total expenses	7,873		15,476
Income from discontinued operations before income taxes	2,040		4,174
Income taxes - discontinued operations	833		1,705
Income from discontinued operations - net of tax	$	1,207	$	2,469

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Other Intangible Assets Indefinite lived intangible assets (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Acquired Indefinite-lived Intangible Assets [Line Items]
Total	$ 18,139	$ 18,139
Tradenames
Acquired Indefinite-lived Intangible Assets [Line Items]
Tradenames	17,764	17,764
Licensing Agreements [Member]
Acquired Indefinite-lived Intangible Assets [Line Items]
Licenses	$ 375	$ 375

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Income Taxes

6 Months Ended

Jun. 30, 2014

Income Tax Disclosure [Abstract]

Income Tax Disclosure [Text Block]

Income Taxes

The following table presents the provision for income taxes for both continuing and discontinued operations:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income taxes - continuing operations	$	1,718	$	1,593	$	3,700	$	2,075
Income taxes - discontinued operations	—		833		—		1,705
Income taxes	$	1,718	$	2,426	$	3,700	$	3,780

The following table presents the provision for income taxes from continuing operations:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Current	$	2,963		$	3,007		$	5,208		$	2,628
Deferred	(1,245		)	(1,414		)	(1,508		)	(553		)
Income taxes - continuing operations	$	1,718		$	1,593		$	3,700		$	2,075

The following table presents a reconciliation of income taxes from continuing operations calculated at the federal statutory rate of 35% and the income tax expense attributable to continuing operations for the following periods:

	For the Three Months Ended June 30,										For the Six Months Ended June 30,
	2014					2013					2014					2013
	Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income
Income taxes at federal income tax rate	$	1,956		35.00	%	$	1,755		35.00	%	$	3,965		35.00	%	$	2,640		35.00	%
Effect of:
Small life deduction	(103		)	(1.84	)	(82		)	(1.64	)	(210		)	(1.85	)	(191		)	(2.53	)
Non-deductible expenses	22			0.39		20			0.40		44			0.39		39			0.52
Tax exempt interest	(39		)	(0.70	)	(39		)	(0.78	)	(73		)	(0.64	)	(70		)	(0.93	)
State taxes	133			2.38		(10		)	(0.20	)	295			2.60		50			0.66
Non-controlling interest	(206		)	(3.68	)	(65		)	(1.30	)	(510		)	(4.50	)	(351		)	(4.65	)
Other, net	(45		)	(0.80	)	14			0.28		189			1.67		(42		)	(0.56	)
Income taxes - continuing operations	$	1,718		30.75	%	$	1,593		31.76	%	$	3,700		32.67	%	$	2,075		27.51	%

At June 30, 2014, the Company had a net operating loss carry forward of $0.6 million, which is subject to certain limitations under IRC Section 382 and will begin to expire in December 31, 2025. The Company expects to utilize the full amount of the net operating loss carryforward.

The Company has reviewed its uncertain tax positions and management has concluded that there are no additional amounts required to be recorded.

In 2012, the Company was under examination by the Internal Revenue Service ("IRS") for the 2010 and 2009 tax years. In February 2013, the IRS completed its field audit for those tax years and presented its findings.  The Company agreed to those findings and expensed $57.0 thousand in the first quarter of 2013.

The Company's income tax returns are subject to review and examination by federal and state taxing authorities. The Company is currently open to audit under the applicable statutes of limitations by the IRS for the tax years 2011 through 2013. The years open to examination by state taxing authorities vary by jurisdiction. There are no extensions of the statute of limitations to assess income taxes currently in effect.

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Other Intangible Assets (Tables)

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Acquired Finite-Lived Intangible Assets by Major Class [Table Text Block]

The following table presents finite-lived other intangible assets and their respective amortization periods:

				At June 30, 2014							At December 31, 2013
	Amortization Period (Years)			Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Customer and agent relationships	7	to	15	$	40,075	$	(15,413	)	$	24,662	$	40,075	$	(13,262	)	$	26,813
Tradenames	8	to	10	1,460		(204		)	1,256		1,460		(128		)	1,332
Software	2.25	to	10	5,336		(3,304		)	2,032		5,336		(2,930		)	2,406
Present value of future profits	0.3	to	0.75	548		(548		)	—		548		(548		)	—
Non-compete agreements	1.5	to	6	1,378		(929		)	449		1,378		(895		)	483
Total finite-lived other intangible assets				$	48,797	$	(20,398	)	$	28,399	$	48,797	$	(17,763	)	$	31,034

Schedule of Indefinite-Lived Intangible Assets [Table Text Block]

The following table presents the carrying amount of indefinite-lived other intangible assets:	At
	June 30, 2014		December 31, 2013
Tradenames	$	17,764	$	17,764
Licenses	375		375
Total	$	18,139	$	18,139

Schedule of Intangible Assets and Goodwill [Table Text Block]

The following table presents the activity in finite and indefinite-lived other intangible assets:

Balance at December 31, 2013	$	49,173
Less: amortization expense	2,635
Balance at June 30, 2014	$	46,538

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block]

The following table presents estimated amortization of finite-lived other intangible assets for the next five years and thereafter ending December 31:

	Estimated Amortization Expense
Remainder of 2014	$	2,635
2015	5,115
2016	4,868
2017	3,648
2018	2,230
Thereafter	9,903
Total	$	28,399

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Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions

6 Months Ended

Jun. 30, 2014

Insurance [Abstract]

Statutory Reporting and Dividend Restrictions Disclosure [Text Block]

Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions

The Company's insurance company subsidiaries may pay dividends to the Company, subject to statutory restrictions. Payments in excess of statutory restrictions (extraordinary dividends) to the Company are permitted only with prior approval of the insurance department of the applicable state of domicile. The Company eliminated all dividends from its subsidiaries in the Consolidated Financial Statements. The following table presents the dividends paid to the Company by its insurance company subsidiaries for the following periods:

	For the Six Months Ended June 30,		For the Twelve Months Ended December 31,
	2014		2013
Ordinary dividends	$	—	$	2,383
Extraordinary dividends	—		—
Total dividends	$	—	$	2,383

The following table presents the combined statutory capital and surplus of the Company's insurance company subsidiaries, the required minimum statutory capital and surplus, as required by the laws of the states in which they are domiciled and the combined amount available for ordinary dividends of the Company's insurance company subsidiaries for the following periods:

	At
	June 30, 2014		December 31, 2013
Combined statutory capital and surplus of the Company's insurance company subsidiaries	$	79,757	$	69,269
Required minimum statutory capital and surplus	$	17,200	$	17,200
Amount available for ordinary dividends of the Company's insurance company subsidiaries	$	4,244	$	3,989

At June 30, 2014, the maximum amount of dividends that our regulated insurance company subsidiaries could pay under applicable laws and regulations without regulatory approval was $4.2 million. The Company may seek regulatory approval to pay dividends in excess of this permitted amount, but there can be no assurance that the Company would receive regulatory approval if sought.

Under the NAIC's Risk-Based Capital Act of 1995, a company's Risk-Based Capital ("RBC") is calculated by applying certain risk factors to various asset, claim and reserve items. If a company's adjusted surplus falls below calculated RBC thresholds, regulatory intervention or oversight is required. The Company's insurance company subsidiaries' RBC levels, as calculated in accordance with the NAIC's RBC instructions, exceeded all RBC thresholds as of June 30, 2014 and December 31, 2013, respectively.

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Variable Interest Entity (Details) (USD $)	3 Months Ended		6 Months Ended		1 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Jul. 31, 2011 Creative Investigations Recovery Group (CIRG)	Jun. 30, 2014 Creative Investigations Recovery Group (CIRG)
Variable Interest Entity [Line Items]
Ownership Percentage in VIE					100.00%
Variable Interest Entity, Financial or Other Support, Amount			$ 100,000
Loss on note receivable	0	0	1,317,000	0
The Company's maximum exposure to loss in the VIE						$ 184,000

XML

Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Operating Activities:
Net income attributable to Fortegra Financial Corporation	$ 6,174	$ 6,935
Adjustments to reconcile net income to net cash flows (used in) provided by operating activities:
Change in deferred acquisition costs	10,201	(6,359)
Depreciation and amortization	5,113	6,413
Deferred income tax (benefit) - continuing operations	(1,508)	(553)
Deferred income tax expense - discontinued operations	0	369
Net realized investment gains	(5)	(1,287)
Gain on sale of subsidiary	0	402
Loss on note receivable	1,317	0
Stock-based compensation expense	613	675
Direct stock awards to employees	1	2
Amortization of premiums and accretion of discounts on investments	885	753
Non-controlling interests	1,463	1,003
Change in allowance for doubtful accounts	(308)	(55)
Changes in operating assets and liabilities, net of the effects of acquisitions and dispositions:
Accrued investment income	(229)	13
Accounts and premiums receivable, net	3,293	(9,750)
Other receivables	3,355	(19,456)
Reinsurance receivables	(3,990)	3,934
Income taxes receivable	0	2,919
Other assets	(1,513)	(525)
Unpaid claims	3,817	(1,483)
Unearned premiums	2,398	(2,488)
Policyholder account balances	(1,405)	(1,183)
Accrued expenses, accounts payable and other liabilities	(6,585)	23,560
Income taxes payable	(120)	203
Deferred revenue	(17,419)	12,727
Change in liabilities of discontinued operations	300
Change in liabilities of discontinued operations	(7,695)	0
Net cash flows (used in) provided by operating activities	(1,847)	15,965
Investing activities:
Proceeds from maturities, calls and prepayments of available-for-sale investments	19,996	4,755
Proceeds from sales of available-for-sale investments	3,804	27,524
Net change in short-term investments	0	251
Purchases of available-for-sale investments	(35,511)	(50,056)
Purchases of property and equipment	(1,281)	(1,892)
Net paid for acquisitions of subsidiaries, net of cash received	20	(2,902)
Sale of subsidiaries, net of cash paid	0	2,180
Net (issuance) from notes receivable	(7,658)	0
Net proceeds from notes receivable	0	260
Net proceeds from related party note receivable	0	6,135
Change in restricted cash	5,014	1,910
Net cash flows (used in) investing activities	(15,616)	(11,835)
Financing activities:
Payments on notes payable	(49,100)	(12,439)
Proceeds from notes payable	56,806	10,500
Net proceeds from exercise of stock options	0	49
Purchase of treasury stock	0	1,357
Net proceeds received from stock issued in the Employee Stock Purchase Plan	113	152
Distributions to non-controlling interest partners	(1,380)	(611)
Dividends paid to non-controlling interests	0	(43)
Net cash flows provided by (used in) financing activities	6,439	(3,749)
Net (decrease) increase in cash and cash equivalents	(11,024)	381
Cash and cash equivalents, beginning of period	21,681	15,209
Cash and cash equivalents, end of period	$ 10,657	$ 15,590

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Consolidated Balance Sheets (Parentheticals) (USD $) In Thousands, except Share data, unless otherwise specified	Jun. 30, 2014	Dec. 31, 2013
Investments:
Fixed maturity securities available-for-sale amortized cost basis	$ 144,118	$ 133,288
Equity securities available-for-sale amortized cost basis	$ 7,081	$ 7,081
Stockholders' Equity:
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	150,000,000	150,000,000
Common stock, shares issued	21,287,525	20,912,853
Common stock, shares outstanding	21,287,525	20,912,853
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Treasury stock, shares	1,224,182	1,224,182

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Other Intangible Assets

6 Months Ended

Jun. 30, 2014

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets Disclosure [Text Block]

Other Intangible Assets

The following table presents finite-lived other intangible assets and their respective amortization periods:

				At June 30, 2014							At December 31, 2013
	Amortization Period (Years)			Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
Customer and agent relationships	7	to	15	$	40,075	$	(15,413	)	$	24,662	$	40,075	$	(13,262	)	$	26,813
Tradenames	8	to	10	1,460		(204		)	1,256		1,460		(128		)	1,332
Software	2.25	to	10	5,336		(3,304		)	2,032		5,336		(2,930		)	2,406
Present value of future profits	0.3	to	0.75	548		(548		)	—		548		(548		)	—
Non-compete agreements	1.5	to	6	1,378		(929		)	449		1,378		(895		)	483
Total finite-lived other intangible assets				$	48,797	$	(20,398	)	$	28,399	$	48,797	$	(17,763	)	$	31,034

The following table presents the carrying amount of indefinite-lived other intangible assets:	At
	June 30, 2014		December 31, 2013
Tradenames	$	17,764	$	17,764
Licenses	375		375
Total	$	18,139	$	18,139

The following table presents the activity in finite and indefinite-lived other intangible assets:

Balance at December 31, 2013	$	49,173
Less: amortization expense	2,635
Balance at June 30, 2014	$	46,538

The following table presents estimated amortization of finite-lived other intangible assets for the next five years and thereafter ending December 31:

	Estimated Amortization Expense
Remainder of 2014	$	2,635
2015	5,115
2016	4,868
2017	3,648
2018	2,230
Thereafter	9,903
Total	$	28,399

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Related Party Transactions (Details) (USD $)	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013
Related Party Transaction [Line Items]
Repayment of Notes Receivable from Related Parties			$ 0	$ 6,135,000
Revenue from Related Parties	315,000	863,000	939,000	1,370,000
Related Party Transaction, Expenses from Transactions with Related Party	0	246,000	122,000	451,000
Accounts receivable from related parties	0		0		113,000
ProtectCELL protection plans [Member]
Related Party Transaction [Line Items]
Revenue from Related Parties	0	595,000	307,000	1,102,000
ProtectCell [Member]
Related Party Transaction [Line Items]
Due from Related Parties	6,100,000		6,100,000
Related Party Transaction, Rate			8.00%
Related Party Transaction, Date			Mar. 15, 2013
Repayment of Notes Receivable from Related Parties			6,100,000
Related party income - Tenant's Legal Liability program [Member]
Related Party Transaction [Line Items]
Revenue from Related Parties	315,000	268,000	632,000	268,000
Interest Income [Member]
Related Party Transaction [Line Items]
Income recorded by the Company from related parties	0	0	0	21,000
Related party lease expense-39500 High Pointe, LLC [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	103,000	103,000	207,000	197,000
related party lease expense-Source International Incorporate [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	0	29,000	0	58,000
Relate party lease expense [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	103,000	132,000	207,000	255,000
Policyholder Benefits and Claims Incurred, Net [Member]
Related Party Transaction [Line Items]
Related Party Transaction, Expenses from Transactions with Related Party	$ 39,000	$ 0	$ 62,000	$ 0

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Fair Value of Financial Instruments Level 4 Rollforward of Level 3 Assets measured at Fair Value (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Fair Value Disclosures [Abstract]
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value	$ 1,064	$ 1,123
Included in other comprehensive (loss)	0	(25)
Transfers (out of) Level 3	0	(27)
Fair Value, Measurement with Unobservable Inputs Reconciliation, Recurring Basis, Asset Value	$ 1,064	$ 1,071

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Document and Entity Information	6 Months Ended
	Jun. 30, 2014	Jul. 31, 2014
Document Information [Line Items]
Entity Registrant Name	Fortegra Financial Corporation
Entity Central Index Key	0001495925
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Document Type	10-Q
Document Period End Date	Jun. 30, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	Q2
Amendment Flag	false
Entity Common Stock, Shares Outstanding		20,061,849
Entity well known seasoned issuer	No
Entity voluntary filer	No
Entity current reporting status	Yes

XML

Variable Interest Entity

6 Months Ended

Jun. 30, 2014

Variable Interest Entity, Not Primary Beneficiary, Disclosures [Abstract]

Variable Interest Entities Disclosure [Text Block]

Variable Interest Entity

In July 2011, the Company sold its 100% interest in CIRG. The consideration included a note receivable, with a first priority lien security interest in the assets of CIRG and other property of the buyers. As previously disclosed, the Company has a variable interest in CIRG. Prior to March 31, 2014, the Company did not consolidate CIRG into its results, because the Company was not the primary beneficiary.

During 2013, the buyers were unable to make the scheduled payments on the note, and the parties executed a forbearance agreement along with a security agreement and a subordination agreement designed to allow more flexibility in timing of repayment. The Company also provided $0.1 million in short term funding.

In March 2014, the Company notified the buyers of the cessation of forbearance, and began to exercise certain of the rights and remedies afforded by the note and related agreements to preserve its economic interest, including steps to protect assets of CIRG. The Company also provided additional short term funding. The Company has not taken ownership of CIRG, but the Company now has power over the VIE, and has consolidated the immaterial balances of CIRG as of June 30, 2014.

In March 2014, the Company established an allowance for the full value of the note and accrued interest, incurring a charge of $1.3 million during the three months ended March 31, 2014. The Company's maximum exposure to further loss in the VIE is limited to the balance of the short term funding.

	At
	June 30, 2014
The Company's maximum exposure to loss in the VIE	$	184

XML

Stock-Based Compensation Stock-Based Compensation Expense (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Income tax benefit	$ (111)	$ (126)	$ (222)	$ (241)
Net stock-based compensation expense	180	202	359	389
Personnel costs
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated Share-based Compensation Expense	156	204	315	388
Other operating expenses
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Allocated Share-based Compensation Expense	$ 135	$ 124	$ 266	$ 242

XML

Fair Value of Financial Instruments Level 4 Fair Value Assets and Liabilities Measured with Level 1,2,& 3 (Details) (USD $)	6 Months Ended
	Jun. 30, 2014 Securities	Dec. 31, 2013 Securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	$ 144,816,000	$ 131,751,000
Equity Securities	6,901,000	6,198,000
Short-term investments	871,000	871,000
Number of Level 3 Securities	6	6
Percent of Total Investments	0.70%	0.80%
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount	0
Fair Value, Assets, Level 2 to Level 1 Transfers, Amount	0
Fair Value, Liabilities, Level 1 to Level 2 Transfers, Amount	0
Fair Value, Liabilities, Level 2 to Level 1 Transfers, Amount	0
Number of Securities transferred from Level 3 to Level 2	0
Consideration of Parent Company Guarantee [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	1,000,000
Number of Level 3 Securities Priced Internally	1
Consideration of Issuer's Audited Financial Statements [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	13,000
Third party pricing service [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	51,000
Number of Level 3 Securities Priced Internally	4
Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149,000	51,435,000
Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124,000	24,547,000
Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534,000	55,360,000
Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009,000	409,000
Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,000	47,000
Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	5,790,000	5,087,000
Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	51,000	51,000
Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,013,000	1,013,000
Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	871,000	871,000
Total Assets	152,588,000	138,820,000
Interest Rate Swap	2,619,000	2,930,000
Fair Value | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149,000	51,435,000
Fair Value | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124,000	24,547,000
Fair Value | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534,000	55,360,000
Fair Value | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009,000	409,000
Fair Value | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	47,000	47,000
Fair Value | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	5,790,000	5,087,000
Fair Value | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	51,000	51,000
Fair Value | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	1,013,000	1,013,000
Fair Value, Inputs, Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	871,000	871,000
Total Assets	6,708,000	6,005,000
Interest Rate Swap	0	0
Fair Value, Inputs, Level 1 [Member] | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 1 [Member] | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 1 [Member] | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 1 [Member] | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 1 [Member] | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	47,000	47,000
Fair Value, Inputs, Level 1 [Member] | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	5,790,000	5,087,000
Fair Value, Inputs, Level 1 [Member] | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 1 [Member] | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0	0
Total Assets	144,816,000	131,751,000
Interest Rate Swap	2,619,000	2,930,000
Fair Value, Inputs, Level 2 [Member] | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	47,149,000	51,435,000
Fair Value, Inputs, Level 2 [Member] | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	34,124,000	24,547,000
Fair Value, Inputs, Level 2 [Member] | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	62,534,000	55,360,000
Fair Value, Inputs, Level 2 [Member] | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	1,009,000	409,000
Fair Value, Inputs, Level 2 [Member] | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 2 [Member] | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 2 [Member] | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 2 [Member] | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Short-term investments	0	0
Total Assets	1,064,000	1,064,000
Interest Rate Swap	0	0
Fair Value, Inputs, Level 3 [Member] | Obligations of the U.S. Treasury and U.S. Government agencies
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Municipal securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Corporate securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Obligations of foreign governments
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fixed Maturity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Common stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Preferred stock - publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	0	0
Fair Value, Inputs, Level 3 [Member] | Common stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	51,000	51,000
Fair Value, Inputs, Level 3 [Member] | Preferred stock - non-publicly traded
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities	$ 1,013,000	$ 1,013,000

XML

Consolidated Statements of Income (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Revenues:
Service and administrative fees	$ 42,074	$ 42,040	$ 86,042	$ 80,898
Ceding commissions	11,996	6,957	22,545	14,120
Net investment income	777	746	1,484	1,649
Net realized investment gains	4	1,280	5	1,287
Net earned premium	33,163	33,681	68,091	66,823
Other income	510	243	885	334
Total revenues	88,524	84,947	179,052	165,111
Expenses:
Net losses and loss adjustment expenses	9,877	10,604	20,703	21,139
Member benefit claims	10,511	11,424	21,182	20,790
Commissions	40,842	36,986	80,913	72,348
Personnel costs	9,980	9,508	20,171	20,305
Other operating expenses	8,237	8,364	16,462	16,439
Depreciation and amortization	1,229	1,205	2,478	2,382
Amortization of intangibles	1,318	1,299	2,635	2,767
Interest expense	934	946	1,854	1,799
Loss on note receivable	0	0	1,317	0
(Gain) on sale of subsidiary	0	(402)	0	(402)
Total expenses	82,928	79,934	167,715	157,567
Income from continuing operations before income taxes	5,596	5,013	11,337	7,544
Income taxes - continuing operations	1,718	1,593	3,700	2,075
Income from continuing operations before non-controlling interests	3,878	3,420	7,637	5,469
Discontinued Operations and Disposal Groups [Abstract]
Income from discontinued operations - net of tax	0	1,207	0	2,469
Discontinued operations - net of tax	0	1,207	0	2,469
Net income before non-controlling interests	3,878	4,627	7,637	7,938
Less: net income attributable to non-controlling interests	602	185	1,463	1,003
Net income attributable to Fortegra Financial Corporation	$ 3,276	$ 4,442	$ 6,174	$ 6,935
Earnings per share - Basic:
Net income from continuing operations - net of tax	$ 0.17	$ 0.17	$ 0.31	$ 0.23
Discontinued operations - net of tax	$ 0.00	$ 0.06	$ 0.00	$ 0.13
Net income attributable to Fortegra Financial Corporation	$ 0.17	$ 0.23	$ 0.31	$ 0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$ 0.16	$ 0.16	$ 0.30	$ 0.22
Discontinued operations - net of tax	$ 0.00	$ 0.06	$ 0.00	$ 0.12
Net income attributable to Fortegra Financial Corporation	$ 0.16	$ 0.22	$ 0.30	$ 0.34
Weighted Average Number of Shares Outstanding Reconciliation [Abstract]
Basic (in shares)	19,745,115	19,540,610	19,698,444	19,548,632
Diluted (in shares)	20,440,133	20,523,090	20,463,929	20,583,951

XML

Accumulated Other Comprehensive Income

6 Months Ended

Jun. 30, 2014

Equity [Abstract]

Other Comprehensive Income

Accumulated Other Comprehensive Income

The following table presents the activity in accumulated other comprehensive income (loss) ("AOCI") for the following periods:

	For the Six Months Ended June 30, 2014
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2013, net of tax	$	(1,761	)	$	(1,904	)	$	(3,665	)
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)	2,943			(257		)	2,686
Income tax (expense) benefit	(1,030		)	89			(941		)
Other comprehensive income (loss) before reclassifications, net of tax	1,913			(168		)	1,745
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(5		)	568			563
Income tax expense (benefit)	2			(199		)	(197		)
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(3		)	369			366
Current period other comprehensive income, net of tax	1,910			201			2,111
Less: other comprehensive income attributable to non-controlling interest	6			—			6
Balance at June 30, 2014, net of tax	$	143		$	(1,703	)	$	(1,560	)
	For the Six Months Ended June 30, 2013
	Net unrealized gains (losses) on available-for-sale securities			Net unrealized gain (loss) on interest rate swap			Total
Balance at December 31, 2012, net of tax	$	2,189		$	(2,820	)	$	(631	)
Other comprehensive income (loss) before reclassifications:
Pre-tax (loss) income	(3,274		)	564			(2,710		)
Income tax benefit (expense)	1,146			(197		)	949
Other comprehensive (loss) income before reclassifications, net of tax	(2,128		)	367			(1,761		)
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss	(1,286		)	559			(727		)
Income tax expense (benefit)	450			(196		)	254
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax	(836		)	363			(473		)
Current period other comprehensive (loss) income, net of tax	(2,964		)	730			(2,234		)
Less: other comprehensive (loss) attributable to non-controlling interest	(11		)	—			(11		)
Balance at June 30, 2013, net of tax	$	(764	)	$	(2,090	)	$	(2,854	)

The following table presents the reclassifications out of AOCI for the following periods:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013			Consolidated Statement of Income Location
Unrealized gains (losses) on available-for-sale securities:
Reclassification of gains included in net income	$	4		$	1,279		$	5		$	1,286		Net realized investment gains (losses)
Related tax (expense)	(2		)	(448		)	(2		)	(450		)	Income taxes
Net of tax	$	2		$	831		$	3		$	836		Net Income
Unrealized gain (loss) on interest rate swap:
Reclassification of (losses) included in net income	$	(286	)	$	(282	)	$	(568	)	$	(559	)	Interest expense
Related tax benefit	100			99			199			196			Income taxes
Net of tax	$	(186	)	$	(183	)	$	(369	)	$	(363	)	Net Income

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Earnings Per Share

6 Months Ended

Jun. 30, 2014

Earnings Per Share [Abstract]

Earnings Per Share [Text Block]

Earnings Per Share

The following table details the earnings per share calculation:	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Numerator: (for both basic and diluted earnings per share)
Income from continuing operations before non-controlling interests	$	3,878	$	3,420	$	7,637	$	5,469
Less: net income attributable to non-controlling interests	602		185		1,463		1,003
Net income from continuing operations - net of tax	3,276		3,235		6,174		4,466
Discontinued operations - net of tax	—		1,207		—		2,469
Net income attributable to Fortegra Financial Corporation	$	3,276	$	4,442	$	6,174	$	6,935
Denominator:
Total weighted average basic common shares outstanding	19,745,115		19,540,610		19,698,444		19,548,632
Effect of dilutive stock options and restricted stock awards	695,018		982,480		765,485		1,035,319
Total weighted average diluted common shares outstanding	20,440,133		20,523,090		20,463,929		20,583,951
Earnings per share - Basic:
Net income from continuing operations - net of tax	$	0.17	$	0.17	$	0.31	$	0.23
Discontinued operations - net of tax	—		0.06		—		0.13
Net income attributable to Fortegra Financial Corporation	$	0.17	$	0.23	$	0.31	$	0.36
Earnings per share - Diluted:
Net income from continuing operations - net of tax	$	0.16	$	0.16	$	0.30	$	0.22
Discontinued operations - net of tax	—		0.06		—		0.12
Net income attributable to Fortegra Financial Corporation	$	0.16	$	0.22	$	0.30	$	0.34
Weighted average anti-dilutive common shares	515,768		887,046		505,207		763,909

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Fair Value of Financial Instruments

6 Months Ended

Jun. 30, 2014

Fair Value Disclosures [Abstract]

Fair Value Disclosures [Text Block]

Fair Value of Financial Instruments 

The carrying and fair values of financial instruments are as follows:	At
	June 30, 2014				December 31, 2013
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets:
Cash and cash equivalents	$	10,657	$	10,657	$	21,681	$	21,681
Restricted cash	12,279		12,279		17,293		17,293
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	47,149		47,149		51,435		51,435
Municipal securities	34,124		34,124		24,547		24,547
Corporate securities	62,534		62,534		55,360		55,360
Obligations of foreign governments	1,009		1,009		409		409
Equity securities:
Common stock - publicly traded	47		47		47		47
Preferred stock - publicly traded	5,790		5,790		5,087		5,087
Common stock - non-publicly traded	51		51		51		51
Preferred stock - non-publicly traded	1,013		1,013		1,013		1,013
Notes receivable	18,297		18,297		11,920		11,920
Accounts and premiums receivable, net	15,743		15,743		18,702		18,702
Other receivables	29,941		29,941		33,409		33,409
Short-term investments	871		871		871		871
Total financial assets	$	239,505	$	239,505	$	241,825	$	241,825
Financial liabilities:
Notes payable	$	10,979	$	10,979	$	3,273	$	3,273
Preferred trust securities	35,000		35,000		35,000		35,000
Interest rate swap	2,619		2,619		2,930		2,930
Total financial liabilities	$	48,598	$	48,598	$	41,203	$	41,203

The Company's financial assets and liabilities accounted for at fair value by level within the fair value hierarchy are as follows:

	At June 30, 2014
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	47,149	$	—	$	47,149	$	—
Municipal securities	34,124		—		34,124		—
Corporate securities	62,534		—		62,534		—
Obligations of foreign governments	1,009		—		1,009		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,790		5,790		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total assets	$	152,588	$	6,708	$	144,816	$	1,064
Financial Liabilities:
Interest rate swap	$	2,619	$	—	$	2,619	$	—

	At December 31, 2013
			Fair Value Measurements Using:
			Quoted prices in active markets for identical assets		Significant other observable inputs		Significant unobservable inputs
	Fair Value		(Level 1)		(Level 2)		(Level 3)
Financial Assets:
Fixed maturity securities:
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,435	$	—	$	51,435	$	—
Municipal securities	24,547		—		24,547		—
Corporate securities	55,360		—		55,360		—
Obligations of foreign governments	409		—		409		—
Equity securities:
Common stock - publicly traded	47		47		—		—
Preferred stock - publicly traded	5,087		5,087		—		—
Common stock - non-publicly traded	51		—		—		51
Preferred stock - non-publicly traded	1,013		—		—		1,013
Short-term investments	871		871		—		—
Total Assets	$	138,820	$	6,005	$	131,751	$	1,064
Financial Liabilities:
Interest rate swap	$	2,930	$	—	$	2,930	$	—

There were no transfers between Level 1, Level 2 or Level 3 during the three or the six months ended June 30, 2014. The Company's use of Level 3 unobservable inputs included six individual securities that accounted for 0.7% of total investments at June 30, 2014. The Company valued one of the Level 3 equity securities at $1.0 million by taking into account the strength of the issuer's parent company guaranteeing the dividend of the issuer, and another Level 3 equity security at $13.0 thousand, by estimating the total value of the Class-A shares outstanding by the issuer and a review of the company's audited financial statements. The remaining four Level 3 securities, with a combined fair value of $51.0 thousand were valued based on information obtained from a third-party pricing service. At December 31, 2013, the Company had six individual securities valued under Level 3 that accounted for 0.8% of total investments.

The following table presents the changes in Level 3 assets measured at fair value:	For the Six Months Ended June 30,
	2014		2013
Beginning balance, January 1,	$	1,064	$	1,123
Total investment gains or losses (realized/unrealized):
Included in other comprehensive (loss)	—		(25		)
Transfers (out of) Level 3	—		(27		)
Ending balance, June 30,	$	1,064	$	1,071

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Notes Payable

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

Notes Payable

The Company's Notes Payable consisted of the following:	At
	June 30, 2014			December 31, 2013
Wells Fargo Bank, N.A. credit facility, maturing August 2019	$	3,000		$	—
Synovus Bank, revolving line of credit, maturing April 2017	7,979			3,273
Total	$	10,979		$	3,273
Maximum balance allowed on the Wells Fargo Bank, N.A. credit facility	$	100,000		$	75,000
Interest rate at the end of the respective period, Wells Fargo Bank, N.A. credit facility (1) (2)	1.80		%	—		%
Maximum balance allowed on the Synovus Bank, revolving line of credit	$	15,000		$	15,000
Interest rate at the end of the respective period, Synovus Bank, revolving line of credit	3.23		%	3.24		%

⁽¹⁾ - At June 30, 2014, the full outstanding balance of the Company's borrowing, under the Revolving Facility, consisted of a one-month term loan at a rate equaling the one-month LIBOR rate plus 1.65%.

⁽²⁾ - At December 31, 2013, the Company had no borrowings outstanding under the Revolving Facility, thus no interest rate can be defined.

The following table presents the aggregate maturities for the Company's notes payable by year at June 30, 2014:

	Maturities
Remainder of 2014	$	10,979
2015	—
2016	—
2017	—
2018	—
Thereafter	—
Total maturities	$	10,979

$100.0 million Secured Credit Agreement - Wells Fargo Bank, N.A.

On April 11, 2014, the Company amended the original credit agreement, entered into on August 2, 2012, (as amended, the "Credit Agreement"), with a syndicate of lenders, among them Wells Fargo Bank, N.A., who also serves as administrative agent ("Wells Fargo" or the "Administrative Agent"). The Credit Agreement matures on August 2, 2019 (subject to earlier termination) and has a revolving credit facility limit of $100.0 million (the "Revolving Facility") with a sub-limit of $10.0 million for swingline loans and $10.0 million for letters of credit. The Credit Agreement includes a provision pursuant to which, from time to time, the Company may request that the lenders in their discretion increase the maximum amount of commitments under the Credit Agreement by an amount not to exceed $50.0 million. The Credit Agreement also contains financial covenants, which the Company must maintain. See the section below, "Financial Covenants" for a presentation of the Company's more significant covenants associated with the Credit Agreement. The amendment to the Credit Agreement reduced the interest rate margin on revolving loans by 0.35% for each pricing level and reduced the unused line fee paid on undrawn revolving commitments by 0.05% for each pricing level. The amendment did not modify the financial covenants.

Financial Covenants - Secured Credit Agreement - Wells Fargo Bank, N.A.

At June 30, 2014 and December 31, 2013, respectively, the Company was required to comply with various financial covenants set forth in the Credit Agreement. The following describes the Credit Agreement's more significant financial covenants in effect at June 30, 2014 and the calculations used to arrive at each ratio (capitalized terms used but not defined in this paragraph are defined in the Credit Agreement or as otherwise provided below):

Total Leverage Ratio- the ratio of (i) Consolidated Total Debt as of such date to (ii) Consolidated Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") for the Measurement Period ending on or immediately prior to such date.

Fixed Charge Coverage Ratio - the ratio of (a) Consolidated Adjusted EBITDA less the actual amount paid by the Borrowers and their Subsidiaries in cash on account of Capital Expenditures less cash taxes paid by the Borrowers and their Subsidiaries to (b) Consolidated Fixed Charges, in each case for the Measurement Period ending on or immediately prior to such date.

Reinsurance Ratio - the ratio (expressed as a percentage) of (a) the aggregate amounts recoverable by the Borrowers and its Subsidiaries from reinsurers divided by (b) the sum of (i) policy and claim liabilities plus (ii) unearned premiums, in each case of the Borrowers and their Subsidiaries determined in accordance with U.S. GAAP.

Risk-Based Capital ("RBC") Ratio - the ratio (expressed as a percentage) of NAIC RBC (as defined in the NAIC standards) for any Regulated Insurance Company on an individual basis, calculated at the end of any Fiscal Year, to the "authorized control level" (as defined in the NAIC standards).

The following table presents the Credit Agreement's more significant financial covenants at June 30, 2014, or at December 31, 2013 with respect to the RBC ratios, which under the Credit Agreement reflect the ratios calculated as of the most recent year-end:

		Actual At
Covenant	Covenant Requirement	June 30, 2014
Total leverage ratio	not more than 3.25	0.82
Fixed charge coverage ratio	not less than 2.00	4.17
Reinsurance ratio	not less than 50%	69.0%
		Actual At
		December 31, 2013
RBC Ratios:
RBC Ratio - Bankers Life of Louisiana	not less than 250%	435.0%
RBC Ratio - Southern Financial Life Insurance Company	not less than 250%	2,096.0%
RBC Ratio - Insurance Company of the South	not less than 250%	366.0%
RBC Ratio - Lyndon Southern Insurance Company	not less than 250%	305.0%
RBC Ratio - Life of the South Insurance Company	not less than 250%	430.0%
RBC Ratio - Response Indemnity Company of California	not less than 250%	39,754.0%

$15.0 million Revolving Line of Credit - Synovus Bank

At June 30, 2014, the Company's subsidiary, South Bay, had a $15.0 million revolving line of credit agreement (the "Line of Credit") with Synovus Bank, entered into in October 2013, with a maturity date of April 2017.  The Line of Credit bears interest at a rate of 300 basis points plus 90-day LIBOR, and is available specifically for the South Bay premium financing product. The Line of Credit allows South Bay to finance up to 90% of the eligible receivables, less an applicable reserve of $500,000. At June 30, 2014, the balance of premium financing receivables included in notes receivable, net, on the Consolidated Balance Sheet, totaled $11.7 million, of which $9.4 million were eligible receivables. At June 30, 2014, South Bay was in compliance with the covenants required by the Line of Credit.

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Income Taxes Provision for Income Taxes from Continuing Operations (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Income Tax Disclosure [Abstract]
Current	$ 2,963	$ 3,007	$ 5,208	$ 2,628
Deferred	(1,245)	(1,414)	(1,508)	(553)
Income taxes - continuing operations	$ 1,718	$ 1,593	$ 3,700	$ 2,075

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Deferred Policy Acquisition Costs (Notes)

6 Months Ended

Jun. 30, 2014

Insurance [Abstract]

Deferred Policy Acquisition Costs [Text Block]

Deferred Acquisition Costs

Deferred Acquisition Costs - Insurance Related

The following table presents the amortization of deferred acquisition costs for the Company's insurance contracts:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - insurance related	$	15,678	$	16,147	$	32,920	$	32,438

Deferred Acquisition Costs - Non-insurance Related

The following table presents the amortization of deferred acquisition costs for the Company's non-insurance products:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - non-insurance related	$	17,278	$	20,971	$	35,292	$	35,884

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Reinsurance Receivables Components of Reinsurance Receivables (Details) (USD $) In Thousands, unless otherwise specified	Jun. 30, 2014		Dec. 31, 2013
Effects of Reinsurance [Line Items]
Reinsurance Recoverables	$ 190,239		$ 186,219
Other reinsurance settlements recoverable	3,604		7,343
Reinsurance receivables	219,074		215,084
Life Insurance Product Line [Member]
Effects of Reinsurance [Line Items]
Reinsurance Recoverables	49,219	[1]	51,355	[1]
Ceded claim reserves recoverable	1,460		1,594
Accident and Health Insurance Product Line [Member]
Effects of Reinsurance [Line Items]
Reinsurance Recoverables	35,792	[1]	36,214	[1]
Ceded claim reserves recoverable	7,313		7,826
Property, Liability and Casualty Insurance Product Line [Member]
Effects of Reinsurance [Line Items]
Reinsurance Recoverables	105,228		98,650
Ceded claim reserves recoverable	16,458		12,102
Ceded claim reserves [Member]
Effects of Reinsurance [Line Items]
Ceded claim reserves recoverable	$ 25,231		$ 21,522

[1] (1) Including policyholder account balances ceded.

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Investments

6 Months Ended

Jun. 30, 2014

Investments [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

Investments

The following table presents the Company's available-for-sale fixed maturity and equity securities:

	At June 30, 2014
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	46,951	$	469	$	(271	)	$	47,149
Municipal securities	34,088		184		(148		)	34,124
Corporate securities	62,086		704		(256		)	62,534
Obligations of foreign governments	993		16		—			1,009
Total fixed maturity securities	$	144,118	$	1,373	$	(675	)	$	144,816
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		35		(219		)	5,790
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	52	$	(232	)	$	6,901

	At December 31, 2013
Description of Security	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Obligations of the U.S. Treasury and U.S. Government agencies	$	51,971	$	142	$	(678	)	$	51,435
Municipal securities	24,856		104		(413		)	24,547
Corporate securities	56,050		210		(900		)	55,360
Obligations of foreign governments	411		—		(2		)	409
Total fixed maturity securities	$	133,288	$	456	$	(1,993	)	$	131,751
Common stock - publicly traded	$	39	$	8	$	—		$	47
Preferred stock - publicly traded	5,974		—		(887		)	5,087
Common stock - non-publicly traded	59		5		(13		)	51
Preferred stock - non-publicly traded	1,009		4		—			1,013
Total equity securities	$	7,081	$	17	$	(900	)	$	6,198

Pursuant to certain reinsurance agreements and statutory licensing requirements, the Company has deposited invested assets in custody accounts or insurance department safekeeping accounts. The Company cannot remove invested assets from these accounts without prior approval of the contractual party or regulatory authority, as applicable. The following table presents the Company's restricted investments included in the Company's available-for-sale fixed maturity securities:

	At
	June 30, 2014		December 31, 2013
Fair value of restricted investments for special deposits required by state insurance departments	$	10,307	$	10,339
Fair value of restricted investments in trust pursuant to reinsurance agreements	5,661		6,134
Total fair value of restricted investments	$	15,968	$	16,473

The following table presents the amortized cost and fair value of fixed maturity securities by contractual maturity. Expected maturities will differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties.

	At June 30, 2014				At December 31, 2013
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	$	9,775	$	9,834	$	18,766	$	18,771
Due after one year through five years	67,865		68,259		69,380		69,355
Due after five years through ten years	43,577		43,636		22,622		21,731
Due after ten years	22,901		23,087		22,520		21,894
Total fixed maturity securities	$	144,118	$	144,816	$	133,288	$	131,751

The following tables present information on unrealized losses on investment securities that have been in an unrealized loss position for less than twelve months, and twelve months or greater:

	At June 30, 2014
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	6,102	$	10	18	$	7,950	$	261	13	$	14,052	$	271	31
Municipal securities	6,852		34		17	4,983		114		10	11,835		148		27
Corporate securities	6,337		25		14	10,228		231		15	16,565		256		29
Total fixed maturity securities	$	19,291	$	69	49	$	23,161	$	606	38	$	42,452	$	675	87
Preferred stock - publicly traded	792		8		1	3,981		211		7	4,773		219		8
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	792	$	8	1	$	4,012	$	224	9	$	4,804	$	232	10

	At December 31, 2013
	Less than Twelve Months					Twelve Months or Greater					Total
Description of Security	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities	Fair Value		Unrealized Losses		# of Securities
Obligations of the U.S. Treasury and U.S. Government agencies	$	37,385	$	672	67	$	234	$	6	7	$	37,619	$	678	74
Municipal securities	10,080		413		23	—		—		—	10,080		413		23
Corporate securities	27,866		734		55	7,676		166		8	35,542		900		63
Obligations of foreign governments	409		2		1	—		—		—	409		2		1
Total fixed maturity securities	$	75,740	$	1,821	146	$	7,910	$	172	15	$	83,650	$	1,993	161
Preferred stock - publicly traded	5,087		887		9	—		—		—	5,087		887		9
Common stock - non-publicly traded	—		—		—	31		13		2	31		13		2
Total equity securities	$	5,087	$	887	9	$	31	$	13	2	$	5,118	$	900	11

The Company does not intend to sell the investments that were in an unrealized loss position at June 30, 2014, and management believes that it is more likely than not that the Company will be able to hold these securities until full recovery of their amortized cost basis for fixed maturity securities or cost for equity securities. As of June 30, 2014, based on the Company's review, none of the fixed maturity or equity securities were deemed to be other-than-temporarily impaired based on the Company's analysis of the securities and its intent to hold the securities until recovery.

The following table presents the total gross proceeds from the sale of available-for-sale investment securities:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Gross proceeds from sales	$	3,303	$	27,112	$	3,804	$	27,524

The following table presents the gross realized gains and gross realized losses for both fixed maturity and equity securities and realized losses for other-than-temporary impairments for available-for-sale investment securities:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014		2013			2014		2013
Gross realized gains	$	4	$	1,355		$	5	$	1,362
Gross realized losses	—		(75		)	—		(75		)
Total net gains from investment sales	4		1,280			5		1,287
Impairment write-downs (other-than-temporary impairments)	—		—			—		—
Net realized investment gains	$	4	$	1,280		$	5	$	1,287

The following table presents the components of net investment income:	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Fixed income securities	$	678		$	675		$	1,293		$	1,412
Cash on hand and on deposit	—			16			—			36
Common and preferred stock dividends	98			101			196			177
Notes receivable	93			68			186			140
Other income	5			—			5			114
Investment expenses	(97		)	(114		)	(196		)	(230		)
Net investment income	$	777		$	746		$	1,484		$	1,649

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Reinsurance Receivables

6 Months Ended

Jun. 30, 2014

Reinsurance Disclosures [Abstract]

Reinsurance [Text Block]

Reinsurance Receivables

The following table presents the effect of reinsurance on premiums written and earned:

Premiums	For the Three Months Ended June 30,												For the Six Months Ended June 30,
	2014						2013						2014						2013
	Written			Earned			Written			Earned			Written			Earned			Written			Earned
Direct and assumed	$	120,204		$	110,779		$	99,978		$	91,854		$	221,676		$	219,278		$	181,488		$	183,976
Ceded	(86,828		)	(77,616		)	(63,810		)	(58,173		)	(156,418		)	(151,187		)	(114,487		)	(117,153		)
Net	$	33,376		$	33,163		$	36,168		$	33,681		$	65,258		$	68,091		$	67,001		$	66,823

The following table presents the effect of reinsurance on losses and loss adjustment expenses ("LAE") incurred:

Losses and LAE incurred	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Direct and assumed	$	27,023		$	22,485		$	53,141		$	43,525
Ceded	(17,146		)	(11,881		)	(32,438		)	(22,386		)
Net losses and LAE incurred	$	9,877		$	10,604		$	20,703		$	21,139

The following table presents the components of the reinsurance receivables:	At
	June 30, 2014		December 31, 2013
Prepaid reinsurance premiums:
Life (1)	$	49,219	$	51,355
Accident and health (1)	35,792		36,214
Property	105,228		98,650
Total	190,239		186,219
Ceded claim reserves:
Life	1,460		1,594
Accident and health	7,313		7,826
Property	16,458		12,102
Total ceded claim reserves recoverable	25,231		21,522
Other reinsurance settlements recoverable	3,604		7,343
Reinsurance receivables	$	219,074	$	215,084

⁽¹⁾ Including policyholder account balances ceded.

The following table presents the aggregate amount included in reinsurance receivables that is comprised of the three largest receivable balances from unrelated reinsurers:

	At
	June 30, 2014		December 31, 2013
Total of the three largest receivable balances from unrelated reinsurers	$	137,328	$	136,061

At June 30, 2014 and December 31, 2013, respectively, the three unrelated reinsurers from whom the Company has the largest receivable balances were: London Life Reinsurance Company (A. M. Best Rating: A), London Life International Reinsurance Corporation (A. M. Best Rating: Not rated) and Spartan Property Insurance Company (A. M. Best Rating: Not rated). The related receivables of Spartan Property Insurance Company and London Life International Reinsurance Corporation are collateralized by assets held in trust accounts and letters of credit due to their offshore relationships. At June 30, 2014, the Company does not believe there is a risk of loss as a result of the concentration of credit risk in the reinsurance program.

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Divestitures

6 Months Ended

Jun. 30, 2014

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations, Disclosure [Text Block]

Divestitures

Discontinued Operations

On December 31, 2013, the Company completed the sale of all of the issued and outstanding stock of its subsidiaries Bliss and Glennon and eReinsure, to AmWINS Holdings, LLC, a North Carolina limited liability company ("AmWINS") (collectively, the "Disposition"), pursuant to the terms of the Stock Purchase Agreement (the "Purchase Agreement"), dated December 2, 2013.

The Company received net cash proceeds of $81.8 million for the Disposition, representing gross proceeds of $83.5 million less $1.0 million in transaction fees paid at the time of closing and $0.7 million of cash held by the disposed entities. The proceeds are subject to certain purchase price adjustments as set forth in the Purchase Agreement to reflect fluctuations in working capital, including adjustments for any receivable balances as of the disposition date not collected within one year.

As a result of the Disposition, the Company no longer operates in the businesses of wholesale insurance brokerage and selling or licensing of a computerized system or platform for the negotiation and/or placement of facultative reinsurance. As of and after December 31, 2013, the Company does not beneficially own the disposed businesses and will no longer consolidate Bliss and Glennon or eReinsure into its financial results. The historical financial results of the disposed businesses for periods prior to the Disposition are presented in the Company's Consolidated Statements of Income as income from discontinued operations - net of tax. The Company allocated interest expense to the discontinued operations based on the anticipated net proceeds that would have been applied to the repayment of the credit facilities outstanding at the respective time, multiplied by the respective interest rate of the credit facilities at the respective time.

The following table presents the assets and liabilities of the discontinued operations included on the Consolidated Balance Sheets:

	At
	June 30, 2014		December 31, 2013
Assets:
Other receivables (1)	$	491	$	791
Assets of discontinued operations	$	491	$	791
Liabilities:
Accrued expenses, accounts payable and other liabilities	$	908	$	2,708
Income taxes payable	—		5,895
Liabilities of discontinued operations	$	908	$	8,603

⁽¹⁾ - In June 2014, $0.3 million was reclassified between liabilities and assets associated with discontinued operations, based on revised estimates of working capital and payment obligations.

The following table presents the amounts related to the Company's discontinued operations in the Consolidated Statements of Income for the following period:

	For the Three Months Ended		For the Six Months Ended
	June 30, 2013		June 30, 2013
Income from discontinued operations:
Revenues:
Brokerage commissions and fees	$	9,891	$	19,622
Net investment income	6		12
Other income	16		16
Total revenues	9,913		19,650
Expenses:
Personnel costs	5,086		10,135
Other operating expenses	1,546		2,888
Depreciation and amortization	162		303
Amortization of intangibles	481		961
Interest expense	598		1,189
Total expenses	7,873		15,476
Income from discontinued operations before income taxes	2,040		4,174
Income taxes - discontinued operations	833		1,705
Income from discontinued operations - net of tax	$	1,207	$	2,469

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Other Intangible Assets Level 4 Other Intangible Assets, Carrying Values and Amortization Periods (Details) (USD $) In Thousands, unless otherwise specified													6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2014 Customer and agent relationships	Dec. 31, 2013 Customer and agent relationships	Jun. 30, 2014 Tradenames	Dec. 31, 2013 Tradenames	Jun. 30, 2014 Software	Dec. 31, 2013 Software	Jun. 30, 2014 Present value of future profits	Dec. 31, 2013 Present value of future profits	Jun. 30, 2014 Non-compete agreements	Dec. 31, 2013 Non-compete agreements	Jun. 30, 2014 Minimum [Member] Customer and agent relationships	Jun. 30, 2014 Minimum [Member] Tradenames	Jun. 30, 2014 Minimum [Member] Software	Jun. 30, 2014 Minimum [Member] Present value of future profits	Jun. 30, 2014 Minimum [Member] Non-compete agreements	Jun. 30, 2014 Maximum [Member] Customer and agent relationships	Jun. 30, 2014 Maximum [Member] Tradenames	Jun. 30, 2014 Maximum [Member] Software	Jun. 30, 2014 Maximum [Member] Present value of future profits	Jun. 30, 2014 Maximum [Member] Non-compete agreements
Acquired Finite-Lived Intangible Assets [Line Items]
Amortization period (Years)													7 years	8 years	2 years 3 months	3 months 18 days	1 year 6 months	15 years	10 years	10 years	9 months	6 years
Gross Carrying Amount	$ 48,797	$ 48,797	$ 40,075	$ 40,075	$ 1,460	$ 1,460	$ 5,336	$ 5,336	$ 548	$ 548	$ 1,378	$ 1,378
Accumulated Amortization	(20,398)	(17,763)	(15,413)	(13,262)	(204)	(128)	(3,304)	(2,930)	(548)	(548)	(929)	(895)
Total	$ 28,399	$ 31,034	$ 24,662	$ 26,813	$ 1,256	$ 1,332	$ 2,032	$ 2,406	$ 0	$ 0	$ 449	$ 483

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Income Taxes Schedule of Effective Rate Reconciliation (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Effective Income Tax Rate Reconciliation, Amount [Abstract]
Income taxes at federal income tax rate	$ 1,956	$ 1,755	$ 3,965	$ 2,640
Small life deduction	(103)	(82)	(210)	(191)
Non-deductible expenses	22	20	44	39
Tax exempt interest	(39)	(39)	(73)	(70)
State taxes	133	(10)	295	50
Non-controlling interests	(206)	(65)	(510)	(351)
Other, net	(45)	14	189	(42)
Income taxes - continuing operations	$ 1,718	$ 1,593	$ 3,700	$ 2,075
Effective Income Tax Rate Reconciliation, Percent [Abstract]
Income taxes at federal income tax rate - Percent of Pre-tax Income	35.00%	35.00%	35.00%	35.00%
Small life deduction - Percent of Pre-tax Income	(1.84%)	(1.64%)	(1.85%)	(2.53%)
Non-deductible expenses - Percent of Pre-tax Income	0.39%	0.40%	0.39%	0.52%
Tax Exempt Income - Percent of Pre-tax Income	(0.70%)	(0.78%)	(0.64%)	(0.93%)
State Taxes- Percent of Pre-tax Income	2.38%	(0.20%)	2.60%	0.66%
Non-controlling interest - Percent of Pre-tax Income	(3.68%)	(1.30%)	(4.50%)	(4.65%)
Other, net - Percent of Pre-tax Income	(0.80%)	0.28%	1.67%	(0.56%)
Effective Income Tax Rate, Continuing Operations	30.75%	31.76%	32.67%	27.51%

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Other Intangible Assets Other Intangible Assets Rollforward (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Goodwill and Intangible Assets Disclosure [Abstract]
Other Intangible Assets, Net			$ 49,173
Less: Amortization Expense	1,318	1,299	2,635	2,767
Other Intangible Assets, Net	$ 46,538		$ 46,538

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Divestitures (Details) (USD $)	3 Months Ended		6 Months Ended			3 Months Ended	6 Months Ended			12 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013	Dec. 31, 2013	Jun. 30, 2013 Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member]	Jun. 30, 2014 Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member]		Jun. 30, 2013 Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member]	Dec. 31, 2013 Discontinued Operations - Sale of Bliss & Glennon and eReinsure [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Disposal Group, Including Discontinued Operation, Working Capital Adjustment							$ 300,000
Disposal Date										Dec. 31, 2013
Discontinued Operations, effective date of purchase agreement										Dec. 02, 2013
Sale of subsidiaries, net of cash paid			0	2,180,000						81,800,000
Proceeds from Divestiture of Businesses										83,500,000
Discontinued Operations, Transaction Costs										1,000,000
Cash Divested from Deconsolidation										700,000
Discontinued Operations, Period for Purchase Price Adjustments							1 year
Assets:
Other receivables							491,000	[1]		791,000
Assets of discontinued operations	491,000		491,000		791,000		491,000			791,000
Liabilities:
Accrued expenses, accounts payable and other liabilities							908,000			2,708,000
Income taxes payable							0			5,895,000
Liabilities of discontinued operations	908,000		908,000		8,603,000		908,000			8,603,000
Income Statement [Abstract]
Brokerage commissions and fees						9,891,000			19,622,000
Net investment income						6,000			12,000
Disposal Group,Including Discontinued Operations, Other Income						16,000			16,000
Total revenue						9,913,000			19,650,000
Expenses:
Personnel costs						5,086,000			10,135,000
Other operating expenses						1,546,000			2,888,000
Depreciation and amortization						162,000			303,000
Amortization of intangibles						481,000			961,000
Interest expense						598,000			1,189,000
Total expenses						7,873,000			15,476,000
Income from discontinued operations before income taxes						2,040,000			4,174,000
Income taxes - discontinued operations	0	833,000	0	1,705,000		833,000			1,705,000
Income from discontinued operations - net of tax	0	1,207,000	0	2,469,000		1,207,000			2,469,000
Discontinued operations - net of tax	$ 0	$ 1,207,000	$ 0	$ 2,469,000

[1] (1) - In June 2014, $0.3 million was reclassified between liabilities and assets associated with discontinued operations, based on revised estimates of working capital and payment obligations.

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Statutory Reporting and Insurance Company Subsidiaries Dividend Restrictions Level 4 (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Statutory Accounting Practices [Line Items]
Cash Dividends Paid to Parent Company by Consolidated Subsidiaries	$ 0	$ 2,383
Combined statutory capital and surplus of the Company's insurance company subsidiaries	79,757	69,269
Required minimum statutory capital and surplus	17,200	17,200
Amount available for ordinary dividends of the Company's insurance company subsidiaries	4,244	3,989
Ordinary dividends paid to the parent compary by insurance company subsidiaries [Member]
Statutory Accounting Practices [Line Items]
Cash Dividends Paid to Parent Company by Consolidated Subsidiaries	0	2,383
Extraordinary dividends paid to the parent compary by insurance company subsidiaries [Member]
Statutory Accounting Practices [Line Items]
Cash Dividends Paid to Parent Company by Consolidated Subsidiaries	$ 0	$ 0

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Deferred Policy Acquisition Costs (Tables)

6 Months Ended

Jun. 30, 2014

Insurance [Abstract]

Deferred Policy Acquisition Costs [Table Text Block]

The following table presents the amortization of deferred acquisition costs for the Company's insurance contracts:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - insurance related	$	15,678	$	16,147	$	32,920	$	32,438

The following table presents the amortization of deferred acquisition costs for the Company's non-insurance products:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Total amortization of deferred acquisition costs - non-insurance related	$	17,278	$	20,971	$	35,292	$	35,884

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Investments Cost, Gross Unrealized Gains, Losses and Fair Value (Details) (USD $) In Thousands, unless otherwise specified	6 Months Ended	12 Months Ended
	Jun. 30, 2014	Dec. 31, 2013
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	$ 144,118	$ 133,288
Fair Value	144,816	131,751
Obligations of the U.S. Treasury and U.S. Government agencies
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	46,951	51,971
Gross Unrealized Gains	469	142
Gross Unrealized Losses	(271)	(678)
Fair Value	47,149	51,435
Municipal securities
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	34,088	24,856
Gross Unrealized Gains	184	104
Gross Unrealized Losses	(148)	(413)
Fair Value	34,124	24,547
Corporate securities
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	62,086	56,050
Gross Unrealized Gains	704	210
Gross Unrealized Losses	(256)	(900)
Fair Value	62,534	55,360
Obligations of foreign governments
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	993	411
Gross Unrealized Gains	16	0
Gross Unrealized Losses	0	(2)
Fair Value	1,009	409
Total fixed maturity securities
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	144,118	133,288
Gross Unrealized Gains	1,373	456
Gross Unrealized Losses	(675)	(1,993)
Fair Value	144,816	131,751
Common stock - publicly traded
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	39	39
Gross Unrealized Gains	8	8
Gross Unrealized Losses	0	0
Fair Value	47	47
Preferred stock - publicly traded
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	5,974	5,974
Gross Unrealized Gains	35	0
Gross Unrealized Losses	(219)	(887)
Fair Value	5,790	5,087
Common stock - non-publicly traded
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	59	59
Gross Unrealized Gains	5	5
Gross Unrealized Losses	(13)	(13)
Fair Value	51	51
Preferred stock - non-publicly traded
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	1,009	1,009
Gross Unrealized Gains	4	4
Gross Unrealized Losses	0	0
Fair Value	1,013	1,013
Total equity securities
Schedule of Available-for-sale Securities [Line Items]
Cost or Amortized Cost	7,081	7,081
Gross Unrealized Gains	52	17
Gross Unrealized Losses	(232)	(900)
Fair Value	$ 6,901	$ 6,198

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Stock-Based Compensation

6 Months Ended

Jun. 30, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

Stock-Based Compensation

Stock Options

The Company did not grant stock options during the three months ended June 30, 2014. During the six months ended June 30, 2014, the Company granted 15,000 time-based stock options, which vest in equal amounts on each of the four anniversaries of the grant date. The following table presents the Company's time-based and performance-based stock option activity for the current period:

	Time-Based								Performance-Based
	Options Outstanding		Weighted Average Exercise Price (in dollars per share)		Options Exercisable		Weighted Average Exercise Price (in dollars per share)		Options Outstanding	Weighted Average Exercise Price (in dollars per share)		Options Exercisable	Weighted Average Exercise Price (in dollars per share)
Balance, December 31, 2013	1,930,407		$	4.22	1,806,251		$	3.98	289,306	$	8.46	—	$	—
Granted	15,000		8.27		—		—		—	—		—	—
Vested	—		—		3,125		2.81		—	—		—	—
Exercised	(391,389	)	3.10		(391,389	)	3.10		—	—		—	—
Canceled/forfeited	(74,176	)	7.90		(74,176	)	7.90		—	—		—	—
Balance, June 30, 2014	1,479,842		$	4.37	1,343,811		$	4.02	289,306	$	8.46	—	$	—
Weighted average remaining contractual term at June 30, 2014 (in years)	3.5				3.0				8.3			—

The following table presents the weighted average assumptions used to estimate the fair values of all stock options granted during the six months ended June 30, 2014:

	Assumptions
Expected term (years)	6.25
Expected volatility	33.83	%
Expected dividends	—	%
Risk-free rate	2.19	%

Restricted Stock Awards

The Company granted 9,944 time-based restricted stock awards during the three months ended June 30, 2014, which vest in equal amounts on each of the three anniversaries of the grant date. During the six months ended June 30, 2014, the Company also granted 30,000 time-based restricted stock awards to its Chief Executive Officer and 75,000 time-based restricted stock awards, equally distributed to five of its Directors. These awards will vest in equal amounts on each of the three anniversaries of the grant date.

The following table presents the Company's time-based and performance-based restricted stock award activity for the current period:

	Time-Based				Performance-Based
	Shares		Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Balance at December 31, 2013	139,680		$	8.59	130,629	$	10.20
Grants	114,944		7.24		—	—
Vests	(45,651	)	8.50		—	—
Forfeitures	—		—		—	—
Balance at June 30, 2014	208,973		$	7.87	130,629	$	10.20

Stock-based Compensation Expense

The following table presents the total time-based and performance-based stock-based compensation expense and the related income tax benefit recognized on the Consolidated Statements of Income:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Personnel costs	$	156		$	204		$	315		$	388
Other operating expenses	135			124			266			242
Income tax benefit	(111		)	(126		)	(222		)	(241		)
Net stock-based compensation expense	$	180		$	202		$	359		$	389

Additional information on total non-vested stock-based compensation is as follows:	At June 30, 2014
	Stock Options		Restricted Stock Awards
Unrecognized compensation cost related to non-vested awards	$	338	$	1,357
Weighted-average recognition period (in years)	3.0		3.3

For the three and the six months ended June 30, 2014, the Company did not recognize expense on 149,306 performance-based stock options and 49,768 performance-based restricted stock awards since the attainment of the performance metrics associated with these awards was not probable based on current projections.

Employee Stock Purchase Plan ("ESPP")

The following table presents the information related to the Company's ESPP for the six-month offering period ending on:

	June 30, 2014		June 30, 2013
Common stock issued under the ESPP (in shares)	18,642		26,019
Weighted-average purchase price per share by participant in the ESPP	$	6.04	$	5.83
Total cash proceeds received from the issuance of common shares under the ESPP	$	113	$	152
ESPP compensation costs recognized	$	32	$	46

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Related Party Transactions

6 Months Ended

Jun. 30, 2014

Related Party Transactions [Abstract]

Related Party Transactions Disclosure [Text Block]

Related Party Transactions

In conjunction with the December 31, 2012 acquisition of ProtectCELL, the Company assumed an office space lease between ProtectCELL and 39500 High Pointe, LLC ("High Pointe"). The ownership of High Pointe includes three members who were the founding members of ProtectCELL and are now employees of the Company. The table below presents the lease payments made to High Pointe.

At December 31, 2012, ProtectCELL held a $6.1 million note receivable carrying an interest rate of 8.00% from High Pointe, which was fully secured by a mortgage on the office building owned by High Pointe (see the lease described above). On March 15, 2013, ProtectCELL received $6.1 million from High Pointe, representing the full payoff of the outstanding balance of the note receivable. The Company only recorded interest income on this note receivable during the three months ended March 31, 2013.

An executive officer of ProtectCELL owned multiple wireless retail locations, which sold ProtectCELL protection plans to wireless retail customers. The executive sold these wireless retail locations in February 2014. The table below presents the income recorded on and the commissions paid for this related party agreement through the sale date of the wireless retail locations.

In conjunction with the December 31, 2012 acquisition of 4Warranty, the Company assumed an office space lease between 4Warranty and Source International Incorporated ("Source"), effective January 1, 2013. The ownership of Source is comprised of two individuals who had consulting relationships with the Company. The lease with Source, which expired on December 31, 2013, was not renewed since the operations of 4Warranty were moved to the Company's main office. The table below presents the lease payments made to Source during the three months and the six months ended June 30, 2013.

In December 2011, the Company entered into a marketing and referral agreement (the "Marketing Agreement") with a company in which a member serving on the Company's Board of Directors also serves on the board of the company providing the marketing services (the "Marketer"). The Marketing Agreement has a five year term and requires the Company to pay the Marketer a per account fee per month based on the number of enrolled customers the Marketer obtains for the Company. In conjunction with the Marketing Agreement, during April 2013, the Company entered into an agreement under which the Marketer began selling insurance-related products of the Company to the Marketer's customers. The Company recorded income and paid claims, associated with the sale of the Company's insurance-related products, which are reflected in the table below.

The following table presents the amounts recorded on the Company's Consolidated Statements of Income resulting from related party transactions:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income recorded by ProtectCELL for protection plans sold	$	—	$	595	$	307	$	1,102
Income recorded for the sale of the Company's insurance-related products under the Marketing Agreement	315		268		632		268
Total related party income recorded by the Company	$	315	$	863	$	939	$	1,370
Interest income recorded on the High Pointe note receivable	$	—	$	—	$	—	$	21
Lease expense paid to High Pointe	$	103	$	103	$	207	$	197
Lease expense paid to Source	—		29		—		58
Total related party lease expense	$	103	$	132	$	207	$	255
Commissions paid by ProtectCELL for protection plans sold	$	—	$	246	$	122	$	451
Claims paid on the Company's insurance-related products under the Marketing Agreement	$	39	$	—	$	62	$	—
The following table presents the amounts recorded on the Company's Consolidated Balance Sheets from related party transactions:
					At
					June 30, 2014		December 31, 2013
Accounts receivable from related parties					$	—	$	113

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Accumulated Other Comprehensive Income Accumulated Other Comprehensive Income - Roll Forward (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at December 31, 2013, net of tax			$ (3,665)
Amounts reclassified from accumulated other comprehensive income (loss):
Current period other comprehensive income, net of tax	1,065	(2,397)	2,111	(2,234)
Balance at June 30, 2014, net of tax	(1,560)		(1,560)
Accumulated Net Unrealized Investment Gain (Loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at December 31, 2013, net of tax			(1,761)	2,189
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)			2,943	(3,274)
Income tax (expense) benefit			(1,030)	1,146
Other comprehensive income (loss) before reclassifications, net of tax			1,913	(2,128)
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss			(5)	(1,286)
Income tax expense (benefit)			2	450
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax			(3)	(836)
Current period other comprehensive income, net of tax			1,910	(2,964)
Other comprehensive income, net of tax			6	(11)
Balance at June 30, 2014, net of tax	143	(764)	143	(764)
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at December 31, 2013, net of tax			(1,904)	(2,820)
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)			(257)	564
Income tax (expense) benefit			89	(197)
Other comprehensive income (loss) before reclassifications, net of tax			(168)	367
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss			568	559
Income tax expense (benefit)			(199)	(196)
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax			369	363
Current period other comprehensive income, net of tax			201	730
Other comprehensive income, net of tax			0	0
Balance at June 30, 2014, net of tax	(1,703)	(2,090)	(1,703)	(2,090)
Accumulated Other Comprehensive Income (Loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance at December 31, 2013, net of tax			(3,665)	(631)
Other comprehensive income (loss) before reclassifications:
Pre-tax income (loss)			2,686	(2,710)
Income tax (expense) benefit			(941)	949
Other comprehensive income (loss) before reclassifications, net of tax			1,745	(1,761)
Amounts reclassified from accumulated other comprehensive income (loss):
Pre-tax (income) loss			563	(727)
Income tax expense (benefit)			(197)	254
Amounts reclassified from accumulated other comprehensive (loss) income, net of tax			366	(473)
Current period other comprehensive income, net of tax			2,111	(2,234)
Other comprehensive income, net of tax			6	(11)
Balance at June 30, 2014, net of tax	$ (1,560)	$ (2,854)	$ (1,560)	$ (2,854)

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Income Taxes Provision for income taxes (Tables)

6 Months Ended

Jun. 30, 2014

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

The following table presents the provision for income taxes from continuing operations:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Current	$	2,963		$	3,007		$	5,208		$	2,628
Deferred	(1,245		)	(1,414		)	(1,508		)	(553		)
Income taxes - continuing operations	$	1,718		$	1,593		$	3,700		$	2,075

The following table presents the provision for income taxes for both continuing and discontinued operations:

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2014		2013		2014		2013
Income taxes - continuing operations	$	1,718	$	1,593	$	3,700	$	2,075
Income taxes - discontinued operations	—		833		—		1,705
Income taxes	$	1,718	$	2,426	$	3,700	$	3,780

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

The following table presents a reconciliation of income taxes from continuing operations calculated at the federal statutory rate of 35% and the income tax expense attributable to continuing operations for the following periods:

	For the Three Months Ended June 30,										For the Six Months Ended June 30,
	2014					2013					2014					2013
	Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income		Amount			Percent of Pre-tax Income
Income taxes at federal income tax rate	$	1,956		35.00	%	$	1,755		35.00	%	$	3,965		35.00	%	$	2,640		35.00	%
Effect of:
Small life deduction	(103		)	(1.84	)	(82		)	(1.64	)	(210		)	(1.85	)	(191		)	(2.53	)
Non-deductible expenses	22			0.39		20			0.40		44			0.39		39			0.52
Tax exempt interest	(39		)	(0.70	)	(39		)	(0.78	)	(73		)	(0.64	)	(70		)	(0.93	)
State taxes	133			2.38		(10		)	(0.20	)	295			2.60		50			0.66
Non-controlling interest	(206		)	(3.68	)	(65		)	(1.30	)	(510		)	(4.50	)	(351		)	(4.65	)
Other, net	(45		)	(0.80	)	14			0.28		189			1.67		(42		)	(0.56	)
Income taxes - continuing operations	$	1,718		30.75	%	$	1,593		31.76	%	$	3,700		32.67	%	$	2,075		27.51	%

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Statement of Comprehensive Income [Abstract]
Net income before non-controlling interests	$ 3,878	$ 4,627	$ 7,637	$ 7,938
Other comprehensive Income (Loss), net of tax:
Unrealized holding gains (losses) arising during the period	1,568	(3,223)	2,943	(3,274)
Related tax (expense) benefit	(549)	1,128	(1,030)	1,146
Reclassification of (gains) included in net income	(4)	(1,279)	(5)	(1,286)
Related tax expense	2	448	2	450
Unrealized gains (losses) on available-for-sale securities, net of tax	1,017	(2,926)	1,910	(2,964)
Interest Rate Swap:
Unrealized (loss) gain on interest rate swap	(212)	532	(257)	564
Related tax benefit (expense)	74	(186)	89	(197)
Reclassification of losses included in net income	286	282	568	559
Related tax benefit	(100)	(99)	(199)	(196)
Unrealized gain on interest rate swap, net of tax	48	529	201	730
Other comprehensive income (loss), net of tax	1,065	(2,397)	2,111	(2,234)
Comprehensive income	4,943	2,230	9,748	5,704
Less: comprehensive income attributable to non-controlling interests	605	174	1,469	992
Comprehensive income attributable to Fortegra Financial Corporation	$ 4,338	$ 2,056	$ 8,279	$ 4,712

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Income Taxes Open Tax Years (Details) (Internal Revenue Service (IRS) [Member])	6 Months Ended
	Jun. 30, 2014
Minimum [Member]
Income Tax Examination [Line Items]
Open Tax Year	2011
Maximum [Member]
Income Tax Examination [Line Items]
Open Tax Year	2013

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2014

Accounting Policies [Abstract]

Significant Accounting Policies [Text Block]

Summary of Significant Accounting Policies

Fortegra's interim Consolidated Financial Statements as of June 30, 2014 and 2013 are unaudited and have been prepared following the significant accounting policies disclosed in Note 2, "Summary of Significant Accounting Policies," of the Notes to Consolidated Financial Statements of the Company's 2013 Form 10-K.

Principles of Consolidation

The Consolidated Financial Statements include the accounts of Fortegra Financial Corporation and its majority-owned and controlled subsidiaries. The Company eliminates all material intercompany account balances and transactions.

Non-Controlling Interests

The third-party ownership of the common stock of SFLAC and of the ownership interests of ProtectCELL, which is treated as a partnership for income tax purposes, have been reflected as non-controlling interests on the Consolidated Balance Sheets. In addition, the Company's non-controlling interest includes the amount for the consolidation of the variable interest entity ("VIE"), Creative Investigations Recovery Group, LLC ("CIRG"). The following table shows the amount outstanding and the percentage of non-controlling interest by entity:

	At
	June 30, 2014					December 31, 2013
	Amount			Percent		Amount		Percent
ProtectCELL	$	5,551		37.6	%	$	5,471	37.6	%
SFLAC	585			15.0	%	562		15.0	%
CIRG	(263		)	100.0	%	—		—	%
Total non-controlling interests	$	5,873				$	6,033

Income (loss) attributable to these non-controlling interests are presented on the Consolidated Statements of Income as net income (loss) attributable to non-controlling interests and on the Consolidated Statements of Comprehensive Income as comprehensive income (loss) attributable to non-controlling interests.

Reportable Segment

The Company reports operating results and financial data in one operating and one reportable segment, Protection Products and Services. The Company has determined that its Chief Executive Officer is the Chief Operating Decision Maker. The financial results of the Company's single segment are equal to the net income from continuing operations reported in the Consolidated Statements of Income for all periods presented.

Discontinued Operations

The results of operations of a business of the Company that either has been disposed of or is classified as held-for-sale are reported in discontinued operations if: 1) the operations and cash flows of the component have been or will be eliminated from the ongoing operations of the Company as a result of the disposal transaction; and 2) the Company will not have any significant continuing involvement in the operations of the component after the disposal transaction. The Company presents the operations of business(es) that meet the criteria for reporting as discontinued operations, and retrospectively reclassifies operating results for all prior periods presented.

On December 31, 2013, the Company completed the sale of its 100% ownership of Bliss and Glennon and eReinsure.com ("eReinsure"). The operating results of these businesses are presented in the line "Income from discontinued operations - net of tax" in the Consolidated Statements of Income for the three and the six months ended June 30, 2013. In accordance with accounting guidance, the Company has elected to not separately disclose the cash flows related to the Bliss and Glennon and eReinsure discontinued operations. In addition, certain assets and liabilities associated with the disposition of Bliss and Glennon and eReinsure that are still subject to final settlement are included in the line items "Assets of discontinued operations" and "Liabilities of discontinued operations," in the Consolidated Balance Sheet at June 30, 2014 and at December 31, 2013. See the Note, "Divestitures," for more information on discontinued operations.

Comprehensive Income (Loss)

Comprehensive income (loss) includes net income and other items of comprehensive income (loss). These other items are generally comprised of unrealized gains and losses on investment securities classified as available-for-sale and unrealized gains and losses on the interest rate swap, net of the related tax effects.

Use of Estimates

Preparation of consolidated financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Reclassifications

Certain items in prior period consolidated financial statements were reclassified to conform to the current period presentation, which had no impact on net income, comprehensive income or loss, net cash provided by operating activities or stockholders' equity.

Subsequent Events

The Company reviewed all material events subsequent to June 30, 2014 that occurred up to the date on which the Company filed its Consolidated Financial Statements, to determine whether any event required recognition or disclosure in these Consolidated Financial Statements and/or disclosure in the notes thereto. For more information, please see the Note, "Subsequent Events."

Recently Adopted Accounting Pronouncements

In July 2013, the FASB issued Accounting Standards Update ("ASU") No. 2013-11, Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists, to clarify the presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. ASU No. 2013-11 is effective prospectively for years and interim periods within those years beginning after December 15, 2013. The adoption of ASU No. 2013-11 did not have a material impact on the Company's consolidated financial position, results of operations or cash flows.

Recently Issued Accounting Pronouncements

In June 2014, the FASB issued ASU No. 2014-12, Compensation - Stock Compensation (Topic 718), Accounting for Share-Based Payments When the Terms of an Award Provide That a Performance Target Could Be Achieved After the Requisite Service Period. ASU No. 2014-12 requires that awards which contain a performance target that affects vesting, and that could be achieved after the requisite service period, be treated as a performance condition. ASU No. 2014-12 is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015. Earlier adoption is permitted. ASU No. 2014-12 maybe applied using two methods: a) prospectively to all awards granted or modified after the effective date or b) retrospectively to all awards with performance targets outstanding as of the beginning of the earliest annual period presented in the financial statements and to all new or modified awards thereafter. The Company is currently reviewing ASU No. 2014-12 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606), which supersedes the revenue recognition requirements in ASC 605, Revenue Recognition.  ASU No. 2014-09 is based on the principle that revenue is recognized to depict the transfer of goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.  ASU No. 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfill a contract.  ASU No. 2014-09 is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods, using either the full retrospective adoption or the modified retrospective adoption. ASU No. 2014-09 does not permit early adoption. The Company is currently reviewing ASU No. 2014-09 and assessing the potential effects on its consolidated financial position, results of operations and cash flows.

In April 2014, the FASB issued ASU No. 2014-08, Presentation of Financial Statements (Topic 205) and Property, Plant, and Equipment (Topic 360): Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity. ASU No. 2014-08 requires that a disposal representing a strategic shift that has (or will have) a major effect on an entity’s financial results or a business activity classified as held for sale should be reported as discontinued operations and also expands the disclosure requirements for discontinued operations and adds new disclosures for individually significant dispositions that do not qualify as discontinued operations. ASU No. 2014-08 is effective prospectively for fiscal years, and interim reporting periods within those years, beginning after December 15, 2014 (early adoption is permitted only for disposals that have not been previously reported). The adoption of ASU No. 2014-08 is not expected to have a material impact on the Company's consolidated financial position, results of operations or cash flows.

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Reinsurance Receivables Premiums, Direct and Assumed, Ceded (Details) (USD $) In Thousands, unless otherwise specified	3 Months Ended		6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013	Jun. 30, 2014	Jun. 30, 2013
Reinsurance Disclosures [Abstract]
Direct and Assumed, Premiums Written	$ 120,204	$ 99,978	$ 221,676	$ 181,488
Direct and Assumed Premiums Earned	110,779	91,854	219,278	183,976
Premiums Written, Net	33,376	36,168	65,258	67,001
Ceded Premiums Written	(86,828)	(63,810)	(156,418)	(114,487)
Ceded Premiums Earned	(77,616)	(58,173)	(151,187)	(117,153)
Net earned premium	$ 33,163	$ 33,681	$ 68,091	$ 66,823

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Stock-Based Compensation Employee Stock Purchase Plan (Details) (USD $) In Thousands, except Share data, unless otherwise specified	6 Months Ended
	Jun. 30, 2014	Jun. 30, 2013
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Total cash proceeds received from the issuance of common shares under the ESPP	$ 113	$ 152
Employee Stock Purchase Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Common stock issued under the ESPP (in shares)	18,642	26,019
Weighted-average purchase price per share by participant in the ESPP	$ 6.04	$ 5.83
Total cash proceeds received from the issuance of common shares under the ESPP	113	152
ESPP compensation costs recognized	$ 32	$ 46

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Notes Payable Notes Payable (Details) (USD $) In Thousands, unless otherwise specified							6 Months Ended			6 Months Ended
	Jun. 30, 2014	Dec. 31, 2013	Jun. 30, 2014 Wells Fargo Bank, N.A. credit facility, [Member]		Dec. 31, 2013 Wells Fargo Bank, N.A. credit facility, [Member]		Jun. 30, 2014 Wells Fargo Bank, N.A. credit facility, [Member] London Interbank Offered Rate (LIBOR) [Member]	Jun. 30, 2014 Synovus Bank, Line of credit [Member]	Dec. 31, 2013 Synovus Bank, Line of credit [Member]	Jun. 30, 2014 Synovus Bank, Line of credit [Member] London Interbank Offered Rate (LIBOR) [Member]
Line of Credit Facility [Line Items]
Notes payable	$ 10,979	$ 3,273	$ 3,000		$ 0			$ 7,979	$ 3,273
Line of Credit Facility, Maximum Borrowing Capacity			$ 100,000		$ 75,000			$ 15,000	$ 15,000
Line of Credit Facility, Interest Rate at Period End			1.80%	[1]	0.00%	[2]		3.23%	3.24%
Debt Instrument, Basis Spread on Variable Rate							1.65%			3.00%

[1] (1) - At June 30, 2014, the full outstanding balance of the Company's borrowing, under the Revolving Facility, consisted of a one-month term loan at a rate equaling the one-month LIBOR rate plus 1.65%.

[2] (2) - At December 31, 2013, the Company had no borrowings outstanding under the Revolving Facility, thus no interest rate can be defined.

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Subsequent Events

6 Months Ended

Jun. 30, 2014

Subsequent Events [Abstract]

Subsequent Events [Text Block]

Subsequent Events

The Company measures subsequent events through the date of the filing of its Consolidated Financial Statements. Management has determined that the following events merit disclosure as subsequent events. As previously disclosed by the Company on a Current Report on Form 8-K, filed on August 12, 2014, the Company entered into an Agreement and Plan of Merger on August 11, 2014, to be acquired by subsidiaries of Tiptree Financial Inc. (NASDAQ: TIPT) for approximately $218.0 million in cash.  Tiptree is a publicly traded diversified holding company, with subsidiaries that operate in four industry segments: insurance and insurance services, specialty finance, asset management and real estate.  Following the execution of the merger agreement, stockholders representing approximately 62% of the outstanding shares of Fortegra common stock executed a written consent adopting and approving the merger agreement. No additional stockholder approvals are necessary to adopt the merger agreement or consummate the transaction. The merger agreement includes a 30-day "go-shop" period during which the Company is permitted to solicit and enter into negotiations with interested parties that offer alternative proposals.  Closing of the merger is subject to the satisfaction of customary conditions including, among other things, insurance regulatory approvals and expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

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Derivative Financial Instruments - Interest Rate Swap Interest Rate Swap - fair value, notional amount, unrealized gain/loss and rates (Details) (USD $) In Thousands, unless otherwise specified			6 Months Ended			6 Months Ended
	Jun. 30, 2014 Interest Rate Swap [Member] Cash Flow Hedging [Member]	Dec. 31, 2013 Interest Rate Swap [Member] Cash Flow Hedging [Member]	Jun. 30, 2014 Accrued expenses, accounts payable and other liabilities [Member]	Jun. 30, 2014 Accrued expenses, accounts payable and other liabilities [Member] Interest Rate Swap [Member] Cash Flow Hedging [Member]	Dec. 31, 2013 Accrued expenses, accounts payable and other liabilities [Member] Interest Rate Swap [Member] Cash Flow Hedging [Member]	Jun. 30, 2014 Accumulated Other Comprehensive Income (Loss) [Member]	Jun. 30, 2014 Accumulated Other Comprehensive Income (Loss) [Member] Interest Rate Swap [Member] Cash Flow Hedging [Member]	Dec. 31, 2013 Accumulated Other Comprehensive Income (Loss) [Member] Interest Rate Swap [Member] Cash Flow Hedging [Member]
Derivatives, Fair Value [Line Items]
Interest rate swap - notional value	$ 35,000	$ 35,000
Fair value of the Swap				2,619	2,930
Unrealized loss, net of tax, on the fair value of the Swap							$ 1,703	$ 1,904
Variable rate of the interest rate swap	0.23%	0.24%
Fixed rate of the interest rate swap	3.47%	3.47%
Balance Sheet Location			Accrued expenses, accounts payable and other liabilities			AOCI

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Notes Payable (Tables)

6 Months Ended

Jun. 30, 2014

Debt Disclosure [Abstract]

Schedule of Line of Credit Facilities [Table Text Block]

The Company's Notes Payable consisted of the following:	At
	June 30, 2014			December 31, 2013
Wells Fargo Bank, N.A. credit facility, maturing August 2019	$	3,000		$	—
Synovus Bank, revolving line of credit, maturing April 2017	7,979			3,273
Total	$	10,979		$	3,273
Maximum balance allowed on the Wells Fargo Bank, N.A. credit facility	$	100,000		$	75,000
Interest rate at the end of the respective period, Wells Fargo Bank, N.A. credit facility (1) (2)	1.80		%	—		%
Maximum balance allowed on the Synovus Bank, revolving line of credit	$	15,000		$	15,000
Interest rate at the end of the respective period, Synovus Bank, revolving line of credit	3.23		%	3.24		%

⁽¹⁾ - At June 30, 2014, the full outstanding balance of the Company's borrowing, under the Revolving Facility, consisted of a one-month term loan at a rate equaling the one-month LIBOR rate plus 1.65%.

⁽²⁾ - At December 31, 2013, the Company had no borrowings outstanding under the Revolving Facility, thus no interest rate can be defined.

Schedule of Maturities of Long-term Debt [Table Text Block]

The following table presents the aggregate maturities for the Company's notes payable by year at June 30, 2014:

	Maturities
Remainder of 2014	$	10,979
2015	—
2016	—
2017	—
2018	—
Thereafter	—
Total maturities	$	10,979

Line of Credit Covenant Requirements [Table Text Block]

The following table presents the Credit Agreement's more significant financial covenants at June 30, 2014, or at December 31, 2013 with respect to the RBC ratios, which under the Credit Agreement reflect the ratios calculated as of the most recent year-end:

		Actual At
Covenant	Covenant Requirement	June 30, 2014
Total leverage ratio	not more than 3.25	0.82
Fixed charge coverage ratio	not less than 2.00	4.17
Reinsurance ratio	not less than 50%	69.0%
		Actual At
		December 31, 2013
RBC Ratios:
RBC Ratio - Bankers Life of Louisiana	not less than 250%	435.0%
RBC Ratio - Southern Financial Life Insurance Company	not less than 250%	2,096.0%
RBC Ratio - Insurance Company of the South	not less than 250%	366.0%
RBC Ratio - Lyndon Southern Insurance Company	not less than 250%	305.0%
RBC Ratio - Life of the South Insurance Company	not less than 250%	430.0%
RBC Ratio - Response Indemnity Company of California	not less than 250%	39,754.0%

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Derivative Financial Instruments - Interest Rate Swap

6 Months Ended

Jun. 30, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivative Financial Instruments - Interest Rate Swap

The Company has an interest rate swap (the "Swap") with Wells Fargo Bank, N.A., pursuant to which the Company swapped the floating rate portion of its outstanding preferred trust securities to a fixed rate. The Swap, designated as a cash flow hedge, commenced in June 2012 and expires in June 2017.

The following table presents the fair value (including accrued interest) and the related outstanding notional amount of the Company's single derivative instrument and indicates where the Company records each amount within its Consolidated Balance Sheets:

		At
	Balance Sheet Location	June 30, 2014			December 31, 2013
Derivative designated as cash flow hedging instrument:
Interest rate swap - notional value		$	35,000		$	35,000
Fair value of the Swap	Accrued expenses, accounts payable and other liabilities	2,619			2,930
Unrealized loss, net of tax, on the fair value of the Swap	AOCI	1,703			1,904
Variable rate of the interest rate swap		0.23		%	0.24		%
Fixed rate of the interest rate swap		3.47		%	3.47		%

The following table presents the pretax impact of the Swap on the Consolidated Financial Statements for the following periods:

	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2014			2013		2014			2013
(Loss) gain recognized in AOCI on the derivative-effective portion	$	(212	)	$	532	$	(257	)	$	564
Loss reclassified from AOCI into income-effective portion	$	286		$	282	$	568		$	559
Gain (loss) recognized in income on the derivative-ineffective portion	$	—		$	—	$	—		$	—

The following table presents the estimated amount to be reclassified to earnings from AOCI during the next 12 months. These net losses reclassified into earnings are primarily expected to increase net interest expense related to the respective hedged item.

	At
	June 30, 2014
Estimated loss to be reclassified to earnings from AOCI during the next 12 months	$	1,130