Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2013

Fair Value Measurements [Abstract]

Assets measured at fair value on a recurring basis

Assets measured at fair value on a recurring basis for June 30, 2013 and December 31, 2012 are summarized below:

As of June 30, 2013

Fair Value Measurements Using

(dollars in thousands)

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	242,555	$	14,398	$	—	$	256,953
States of the U.S. and political subdivisions of the states		—		4,425		—		4,425
Corporate securities		—		35,268		—		35,268
Mortgage-backed securities		—		4,866		—		4,866
Commercial mortgage-backed securities		—		2,825		—		2,825
Asset-backed securities		—		6,972		—		6,972
Total fixed maturity securities		242,555		68,754		—		311,309
Equity securities		—		39		6,073		6,112
Short term investments		611,267		—		—		611,267
Trading securities		—		—		—		—
Total	$	853,822	$	68,793	$	6,073	$	928,688

As of December 31, 2012

Fair Value Measurements Using

(dollars in thousands)

	Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
	(Level 1)		(Level 2)		(Level 3)		Total
Fixed maturity securities:
U.S. Treasury securities and obligations of U.S. Government corporations and agencies	$	31,032	$	25,509	$	—	$	56,541
States of the U.S. and political subdivisions of the states		—		46,164		—		46,164
Corporate securities		—		340,729		—		340,729
Mortgage-backed securities		—		248,240		—		248,240
Commercial mortgage-backed securities		—		63,215		—		63,215
Asset-backed securities		—		74,688		—		74,688
Total fixed maturity securities		31,032		798,545		—		829,577
Equity securities		5,151		—		6,706		11,857
Short term investments		76,502		—		—		76,502
Trading securities		990		11,722		—		12,712
Total	$	113,675	$	810,267	$	6,706	$	930,648

Summary of reconciliation of the beginning and ending balances for the investments categorized as Level 3

A reconciliation of the beginning and ending balances for the investments categorized as Level 3 at June 30, 2013 and December 31, 2012 are as follows:

	As of June 30, 2013
	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	(dollars in thousands)
	Equity Securities
Balance at December 31, 2012	$	6,706
Total gains (losses) realized (unrealized):
Included in earnings		—
Included in other comprehensive income		(633	)
Purchases		—
Sales		—
Issuance and settlements		—
Net transfers in (out of) Level 3		—
Balance at June 30, 2013	$	6,073
Change in net unrealized losses relating to assets still held at reporting date	$	(633	)

	As of December 31, 2012
	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	(dollars in thousands)
	Equity Securities
Balance at December 31, 2011	$	6,751
Total gains (losses) realized (unrealized):
Included in earnings		—
Included in other comprehensive income		(45	)
Purchases		—
Sales		—
Issuance and settlements		—
Net transfers in (out of) Level 3		—
Balance at December 31, 2012	$	6,706
Change in net unrealized losses relating to assets still held at reporting date	$	(45	)

Fair value of financial instruments

The following table sets forth the carrying amount, estimated fair value and level within the fair value hierarchy of financial instruments as of June 30, 2013 and December 31, 2012.

	Level in Fair		June 30, 2013				December 31, 2012
	Value Hierarchy		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value
Assets:
Cash and cash equivalents		Level 1	$	18,567	$	18,567	$	20,224	$	20,224
Fixed maturities		*	$	311,309	$	311,309	$	829,577	$	829,577
Equity securities		*	$	6,112	$	6,112	$	11,857	$	11,857
Short-term investments		*	$	611,267	$	611,267	$	76,502	$	76,502
Trading securities		*	$	—	$	—	$	12,712	$	12,712
Premiums receivable		Level 2	$	29,249	$	29,249	$	32,559	$	32,559
Reinsurance recoverable		Level 2	$	185,644	$	185,644	$	183,562	$	183,562
Liabilities:
Loans payable		Level 2	$	39,183	$	39,183	$	39,183	$	39,183