Investments |
Investments The cost or amortized cost, gross unrealized gain or loss, and estimated fair value of the investments in securities classified as available for sale at September 30, 2017 and December 31, 2016, were as follows (dollars in thousands): | | | | | | | | | | | | | | | September 30, 2017 | | Cost or Amortized Cost | Gross Unrealized | Estimated Fair Value | | Gains | Losses | Fixed Maturity Securities: | | | | | U.S. Government obligations | $ | 9,252 |
| $ | 26 |
| $ | (43 | ) | $ | 9,235 |
| State and local government | 16,009 |
| 246 |
| (53 | ) | 16,202 |
| Corporate debt | 40,219 |
| 279 |
| (162 | ) | 40,336 |
| Commercial mortgage-backed and other asset-backed | 56,434 |
| 156 |
| (480 | ) | 56,110 |
| Total fixed maturity securities available for sale | 121,914 |
| 707 |
| (738 | ) | 121,883 |
| Equity Securities | 9,386 |
| 923 |
| (152 | ) | 10,157 |
| Total securities available for sale | $ | 131,300 |
| $ | 1,630 |
| $ | (890 | ) | $ | 132,040 |
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| | | | | | | | | | | | | | | December 31, 2016 | | Cost or Amortized Cost | Gross Unrealized | Estimated Fair Value | | Gains | Losses | Fixed Maturity Securities: | | | | | U.S. Government obligations | $ | 5,908 |
| $ | 31 |
| $ | (36 | ) | $ | 5,903 |
| State and local government | 13,618 |
| 106 |
| (205 | ) | 13,519 |
| Corporate debt | 34,105 |
| 205 |
| (254 | ) | 34,056 |
| Commercial mortgage-backed and other asset-backed | 60,284 |
| 132 |
| (731 | ) | 59,685 |
| Total fixed maturity securities available for sale | 113,915 |
| 474 |
| (1,226 | ) | 113,163 |
| Equity Securities | 4,283 |
| 366 |
| (70 | ) | 4,579 |
| Total securities available for sale | $ | 118,198 |
| $ | 840 |
| $ | (1,296 | ) | $ | 117,742 |
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The following table summarizes the aggregate fair value and gross unrealized losses, by security type, of the available-for-sale securities in unrealized loss positions. The table segregates the holdings based on the length of time that individual securities have been in a continuous unrealized loss position, as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | September 30, 2017 | | Less than 12 months | | Greater than 12 months | | Total | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | Fixed Maturity Securities: | | | | | | | | | | | | U.S. Government obligations | 10 |
| $ | 6,177 |
| $ | (37 | ) | | 4 |
| $ | 914 |
| $ | (6 | ) | | 14 |
| $ | 7,091 |
| $ | (43 | ) | State and local government | 23 |
| 6,108 |
| (35 | ) | | 3 |
| 506 |
| (18 | ) | | 26 |
| 6,614 |
| (53 | ) | Corporate debt | 13 |
| 7,568 |
| (143 | ) | | 5 |
| 2,037 |
| (19 | ) | | 18 |
| 9,605 |
| (162 | ) | Commercial mortgage and asset-backed | 42 |
| 31,653 |
| (424 | ) | | 6 |
| 1,656 |
| (56 | ) | | 48 |
| 33,309 |
| (480 | ) | Total fixed maturity securities available for sale | 88 |
| 51,506 |
| (639 | ) | | 18 |
| 5,113 |
| (99 | ) | | 106 |
| 56,619 |
| (738 | ) | Equity Securities: | | | | | | | | | | | | Common stocks | 19 |
| 1,087 |
| (141 | ) | | 1 |
| 33 |
| (11 | ) | | 20 |
| 1,120 |
| (152 | ) | Total equity securities available for sale | 19 |
| 1,087 |
| (141 | ) | | 1 |
| 33 |
| (11 | ) | | 20 |
| 1,120 |
| (152 | ) | Total securities | 107 |
| $ | 52,593 |
| $ | (780 | ) | | 19 |
| $ | 5,146 |
| $ | (110 | ) | | 126 |
| $ | 57,739 |
| $ | (890 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | December 31, 2016 | | Less than 12 months | | Greater than 12 months | | Total | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | | No. of Issues | Fair Value of Investments with Unrealized Losses | Gross Un realized Losses | Fixed Maturity Securities: | | | | | | | | | | | | U.S. Government obligations | 15 |
| $ | 4,539 |
| $ | (36 | ) | | — |
| $ | — |
| $ | — |
| | 15 |
| $ | 4,539 |
| $ | (36 | ) | State and local government | 29 |
| 8,217 |
| (202 | ) | | 1 |
| 104 |
| (3 | ) | | 30 |
| 8,321 |
| (205 | ) | Corporate debt | 22 |
| 9,031 |
| (239 | ) | | 7 |
| 3,369 |
| (15 | ) | | 29 |
| 12,400 |
| (254 | ) | Commercial mortgage and asset-backed | 59 |
| 38,048 |
| (722 | ) | | 5 |
| 802 |
| (9 | ) | | 64 |
| 38,850 |
| (731 | ) | Total fixed maturity securities available for sale | 125 |
| 59,835 |
| (1,199 | ) | | 13 |
| 4,275 |
| (27 | ) | | 138 |
| 64,110 |
| (1,226 | ) | Equity Securities: | | | | | | | | | | | | Common stock | 76 |
| 2,472 |
| (61 | ) | | 2 |
| 66 |
| (9 | ) | | 78 |
| 2,538 |
| (70 | ) | Total equity securities available for sale | 76 |
| 2,472 |
| (61 | ) | | 2 |
| 66 |
| (9 | ) | | 78 |
| 2,538 |
| (70 | ) | Total securities | 201 |
| $ | 62,307 |
| $ | (1,260 | ) | | 15 |
| $ | 4,341 |
| $ | (36 | ) | | 216 |
| $ | 66,648 |
| $ | (1,296 | ) |
The Company analyzed its investment portfolio in accordance with its other-than-temporary impairment ("OTTI") review procedures and determined the Company did not need to record a credit-related OTTI loss in net income, nor recognize a non-credit related OTTI loss in other comprehensive income for the nine months ended September 30, 2017 and 2016. The Company’s sources of net investment income are as follows (dollars in thousands): | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2017 | | 2016 | | 2017 | | 2016 | Fixed maturity securities | $ | 733 |
| | $ | 616 |
| | $ | 2,030 |
| | $ | 1,772 |
| Equity securities | 44 |
| | 23 |
| | 94 |
| | 75 |
| Cash and short-term investments | 64 |
| | 7 |
| | 91 |
| | 13 |
| Total investment income | 841 |
| | 646 |
| | 2,215 |
| | 1,860 |
| Investment expenses | (73 | ) | | (86 | ) | | (207 | ) | | (235 | ) | Net investment income | $ | 768 |
| | $ | 560 |
| | $ | 2,008 |
| | $ | 1,625 |
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The following table summarizes the gross realized gains and losses from sales or maturities of available-for-sale fixed maturity and equity securities (dollars in thousands): | | | | | | | | | | | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2017 | | 2016 | | 2017 | | 2016 | Fixed maturity securities: | | | | | | | | Gross realized gains | $ | 29 |
| | $ | 7 |
| | $ | 29 |
| | $ | 524 |
| Gross realized losses | (1 | ) | | — |
| | (8 | ) | | (22 | ) | Total fixed maturity securities | 28 |
| | 7 |
| | 21 |
| | 502 |
| Equity securities: | | | | | | | | Gross realized gains | 11 |
| | 79 |
| | 40 |
| | 230 |
| Gross realized losses | — |
| | (15 | ) | | (30 | ) | | (128 | ) | Total equity securities | 11 |
| | 64 |
| | 10 |
| | 102 |
| Total realized gains (losses) | $ | 39 |
| | $ | 71 |
| | $ | 31 |
| | $ | 604 |
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Proceeds from the sales of debt and equity securities available for sale, maturities and other redemptions (primarily the return of capital) were $19.5 million and $40.9 million for the nine months ended September 30, 2017 and 2016, respectively. The table below summarizes the amortized cost and fair value of available-for-sale fixed maturity securities by contractual maturity at September 30, 2017. Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties (dollars in thousands): | | | | | | | | | | Amortized Cost | | Estimated Fair Value | Due in one year or less | $ | 11,122 |
| | $ | 11,136 |
| Due after one year through five years | 34,171 |
| | 34,327 |
| Due after five years through ten years | 11,255 |
| | 11,392 |
| Due after ten years | 8,932 |
| | 8,918 |
| Securities with contractual maturities | 65,480 |
| | 65,773 |
| Commercial mortgage and asset backed | 56,434 |
| | 56,110 |
| Total Fixed maturity securities | $ | 121,914 |
| | $ | 121,883 |
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At September 30, 2017 and December 31, 2016, the Insurance Company Subsidiaries had an aggregate of $8.2 million and $9.6 million respectively, on deposit in trust accounts to meet the deposit requirements of various state insurance departments. At September 30, 2017 and December 31, 2016, the Company had $12.8 million and $10.3 million held in trust accounts to meet collateral requirements with other third-party insurers, relating to various fronting arrangements. There are withdrawal and other restrictions on these deposits, including the type of investments that may be held, however, the Company may generally invest in high-grade bonds and short-term investments and earn interest on the funds.
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