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Quarterly Financial Information
 12 Months Ended
Dec. 31, 2015
Quarterly Financial Data [Abstract]  
Quarterly Financial Information
Quarterly Financial Information (Unaudited)
The following table presents summarized quarterly financial data for 2015 and 2014:
 
 
Quarter Ended
 
 
March 31
 
June 30
 
September 30
 
December 31
 
 
(Amounts in thousands, except per share data)
 
2015
 
 
 
 
 
 
 
 
Net premiums earned
$
720,737

 
$
731,546

 
$
745,520

  
$
760,094

 
Change in fair value of investments pursuant to the fair value option
$
(4,884
)
 
$
(40,783
)
 
$
(18,538
)
 
$
2,474

 
Income before income taxes
$
29,859

 
$
4,511

 
$
12,267

 
$
23,930

 
Net income
$
26,165

 
$
9,639

 
$
15,270

 
$
23,405

 
Basic earnings per share (2)
$
0.47

 
$
0.17

 
$
0.28

 
$
0.42

 
Diluted earnings per share (2)
$
0.47

 
$
0.17

 
$
0.28

 
$
0.42

 
Dividends paid per share
$
0.6175

 
$
0.6175

 
$
0.6175

  
$
0.6200

 
 
 
 
 
 
 
 
 
 
2014
 
 
 
 
 
 
 
 
Net premiums earned
$
683,701

 
$
697,889

 
$
705,237

  
$
709,368

 
Change in fair value of investments pursuant to the fair value option
$
45,699

 
$
41,412

 
$
(20,528
)
 
$
(22,824
)
 
Income (loss) before income taxes
$
102,030

 
$
136,436

 
$
37,120

 
$
(28,161
)
 
Net income (loss)
$
72,649

 
$
94,960

 
$
31,296

 
$
(20,956
)
 
Basic earnings per share
$
1.32

 
$
1.73

 
$
0.57

 
$
(0.38
)
 
Diluted earnings per share
$
1.32

 
$
1.73

 
$
0.57

 
$
(0.38
)
(1) 
Dividends paid per share
$
0.6150

 
$
0.6150

 
$
0.6175

  
$
0.6175

 
 __________
(1)
The dilutive impact of incremental shares is excluded from net loss position in accordance with GAAP.
(2)
The basic and diluted earnings per share do not sum due to rounding.

Net income during 2015 was primarily affected by net realized investment losses, an increase in losses and loss adjustment expenses partially offset by an increase in net premiums earned. Net income during the fourth quarter of 2015 was affected by net realized investment losses of $8.2 million as compared with net loss during the fourth quarter of 2014 which was affected by net realized investment losses of $21.6 million and by the $27.6 million penalty assessed by the California DOI and accrued by the Company in the fourth quarter of 2014.

Net income during 2014 was primarily affected by the $27.6 million penalty assessed by California DOI, higher net premiums earned and increases in the fair value of the Company’s investment portfolio offset by catastrophe related losses. See Note 17. Commitments and Contingencies for "2004 NNC" discussion. The primary causes of the net loss during the fourth quarter of 2014 were the $27.6 million penalty described above, the declines in the fair value of the Company’s equity securities due to the overall decline in the equity market, and the severe rainstorms in California.

Net income during 2013 was primarily affected by higher net premiums earned offset by catastrophe related losses, and declines in the fair value of the Company’s investment portfolio due to the overall decline in the municipal bond markets. Net income during 2013 was also affected by the consolidation of claims and underwriting operations located outside of California into hub locations, which resulted in approximately $10 million of pre-tax office closure costs and severance related expense during the first quarter of 2013. The primary causes of the net loss during the second quarter of 2013 were increased losses resulting from catastrophe losses due to tornadoes in Oklahoma and severe storms in the Midwest and the Southeast regions, and declines in the fair value of the Company’s municipal and equity securities due to the overall decline in the municipal and equity markets.