Investments (Tables)

9 Months Ended

Sep. 30, 2020

Schedule of amortized cost and estimated fair value of securities

The amortized cost and estimated fair value of investment securities as of September 30, 2020 and December 31, 2019, were as follows:

	September 30, 2020
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Fixed income securities:
U.S. Government and agencies	$	16,110	$	1,324	$	(1	)	$	17,433
Obligations of states and political subdivisions		62,975		3,044		(150	)		65,869
Corporate securities		120,955		8,137		(434	)		128,658
Residential mortgage-backed securities		36,384		1,612		(4	)		37,992
Commercial mortgage-backed securities		24,574		1,705		(29	)		26,250
Asset-backed securities		45,906		509		(188	)		46,227
Total fixed income securities		306,904		16,331		(806	)		322,429

Equity securities:
Basic materials		1,259		289		(69	)		1,479
Communications		4,304		2,563		(507	)		6,360
Consumer, cyclical		5,903		3,139		(596	)		8,446
Consumer, non-cyclical		10,456		6,092		(758	)		15,790
Energy		1,931		18		(532	)		1,417
Financial		5,879		520		(491	)		5,908
Industrial		6,857		4,240		(132	)		10,965
Technology		7,905		7,570		(90	)		15,385
Utility		37		-		(1	)		36
Total equity securities		44,531		24,431		(3,176	)		65,786
Total investments	$	351,435	$	40,762	$	(3,982	)	$	388,215

	December 31, 2019
	Cost or Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Fixed income securities:
U.S. Government and agencies	$	17,078	$	472	$	(4	)	$	17,546
Obligations of states and political subdivisions		55,232		1,511		(91	)		56,652
Corporate securities		109,457		3,772		(16	)		113,213
Residential mortgage-backed securities		50,458		1,050		(22	)		51,486
Commercial mortgage-backed securities		26,450		658		(51	)		27,057
Asset-backed securities		30,029		132		(170	)		29,991
Total fixed income securities		288,704		7,595		(354	)		295,945

Equity securities:
Basic materials		1,062		155		(7	)		1,210
Communications		4,823		2,342		(169	)		6,996
Consumer, cyclical		5,477		4,207		(72	)		9,612
Consumer, non-cyclical		7,483		5,255		(171	)		12,567
Energy		2,817		124		(485	)		2,456
Financial		5,059		905		(35	)		5,929
Industrial		5,293		4,023		(17	)		9,299
Technology		6,022		5,867		(26	)		11,863
Total equity securities		38,036		22,878		(982	)		59,932
Total investments	$	326,740	$	30,473	$	(1,336	)	$	355,877

Schedule of amortized cost and fair value of fixed income securities by contractual maturity

The amortized cost and estimated fair value of fixed income securities by contractual maturity are shown below. Actual maturities could differ from contractual maturities because issuers of the securities may have the right to call or prepay certain obligations, which may or may not include call or prepayment penalties.

	September 30, 2020
	Amortized Cost		Fair Value
Due to mature:
One year or less	$	16,413	$	16,659
After one year through five years		90,477		95,182
After five years through ten years		59,812		64,928
After ten years		33,338		35,191
Mortgage / asset-backed securities		106,864		110,469
Total fixed income securities	$	306,904	$	322,429

	December 31, 2019
	Amortized Cost		Fair Value
Due to mature:
One year or less	$	19,567	$	19,663
After one year through five years		84,937		87,134
After five years through ten years		55,927		58,466
After ten years		21,336		22,148
Mortgage / asset-backed securities		106,937		108,534
Total fixed income securities	$	288,704	$	295,945

Schedule of unrealized loss of securities

The investment category and duration of the Company’s gross unrealized losses on fixed income securities and equity securities were as follows:

	September 30, 2020
	Less than 12 Months					Greater than 12 months					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Fixed income securities:
U.S. Government and agencies	$	203	$	(1	)	$	-	$	-		$	203	$	(1	)
Obligations of states and political subdivisions		4,578		(150	)		-		-			4,578		(150	)
Corporate securities		8,763		(420	)		693		(14	)		9,456		(434	)
Residential mortgage-backed securities		397		(4	)		-		-			397		(4	)
Commercial mortgage-backed securities		1,511		(29	)		-		-			1,511		(29	)
Asset-backed securities		10,324		(80	)		4,393		(108	)		14,717		(188	)
Total fixed income securities		25,776		(684	)		5,086		(122	)		30,862		(806	)

Equity securities:
Basic materials		345		(69	)		-		-			345		(69	)
Communications		1,272		(507	)		-		-			1,272		(507	)
Consumer, cyclical		1,184		(528	)		211		(68	)		1,395		(596	)
Consumer, non-cyclical		2,456		(758	)		-		-			2,456		(758	)
Energy		47		(33	)		442		(499	)		489		(532	)
Financial		2,750		(491	)		-		-			2,750		(491	)
Industrial		1,139		(132	)		-		-			1,139		(132	)
Technology		1,379		(90	)		-		-			1,379		(90	)
Utility		37		(1	)		-		-			37		(1	)
Total equity securities		10,609		(2,609	)		653		(567	)		11,262		(3,176	)
Total investments	$	36,385	$	(3,293	)	$	5,739	$	(689	)	$	42,124	$	(3,982	)

Table of Contents

NI Holdings, Inc.

Notes to Unaudited Consolidated Financial Statements

(dollar amounts in thousands, except per share amounts)

	December 31, 2019
	Less than 12 Months					Greater than 12 months					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Fixed income securities:
U.S. Government and agencies	$	494	$	(4	)	$	-	$	-		$	494	$	(4	)
Obligations of states and political subdivisions		8,018		(91	)		-		-			8,018		(91	)
Corporate securities		2,066		(15	)		650		(1	)		2,716		(16	)
Residential mortgage-backed securities		2,911		(9	)		2,583		(13	)		5,494		(22	)
Commercial mortgage-backed securities		4,841		(35	)		653		(16	)		5,494		(51	)
Asset-backed securities		8,511		(96	)		7,686		(74	)		16,197		(170	)
Total fixed income securities		26,841		(250	)		11,572		(104	)		38,413		(354	)

Equity securities:
Basic materials		258		(7	)		-		-			258		(7	)
Communications		506		(-	)		658		(169	)		1,164		(169	)
Consumer, cyclical		595		(30	)		146		(42	)		741		(72	)
Consumer, non-cyclical		1,033		(171	)		-		-			1,033		(171	)
Energy		823		(432	)		6		(53	)		829		(485	)
Financial		393		(35	)		-		-			393		(35	)
Industrial		620		(17	)		-		-			620		(17	)
Technology		575		(26	)		-		-			575		(26	)
Total equity securities		4,803		(718	)		810		(264	)		5,613		(982	)
Total investments	$	31,644	$	(968	)	$	12,382	$	(368	)	$	44,026	$	(1,336	)

Schedule of net investment income

Net investment income consisted of the following:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2020		2019		2020		2019
Fixed income securities	$	2,065	$	2,196	$	6,655	$	6,167
Equity securities		278		247		903		704
Real estate		170		91		440		273
Cash and cash equivalents		1		15		27		50
Total gross investment income		2,514		2,549		8,025		7,194
Investment expenses		628		566		2,150		1,690
Net investment income	$	1,886	$	1,983	$	5,875	$	5,504

Schedule of net realized gain (loss) on investments

Net capital gain (loss) on investments consisted of the following:

	Three Months Ended September 30,						Nine Months Ended September 30,
	2020			2019			2020			2019
Gross realized gains:
Fixed income securities	$	279		$	58		$	756		$	114
Equity securities		637			1,386			2,887			2,408
Total gross realized gains		916			1,444			3,643			2,522

Gross realized losses, excluding other-than-temporary impairment losses:
Fixed income securities		252			(46	)		(70	)		(132	)
Equity securities		(532	)		(392	)		(1,552	)		(1,052	)
Total gross realized losses, excluding other-than-temporary impairment losses		(280	)		(438	)		(1,622	)		(1,184	)

Net realized gain on investments		636			1,006			2,021			1,338

Change in net unrealized gain on equity securities		4,466			(384	)		(641	)		8,253
Net capital gain on investments	$	5,102		$	622		$	1,380		$	9,591