Investments (Tables)

12 Months Ended

Dec. 31, 2014

Cash and Investments Including Other-Than-Temporarily Impaired Securities Recognized within Other Comprehensive Income

The following tables set forth our Company’s cash and investments as of December 31, 2014 and 2013. The tables below include OTTI securities recognized within AOCI.

	December 31, 2014
In thousands	Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Amortized Cost
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds	$	397,923	$	3,431	$	(5,965	)	$	400,457
States, municipalities and political subdivisions		541,007		19,204		(558	)		522,361
Mortgage-backed and asset-backed securities:
Agency mortgage-backed securities		364,622		8,476		(998	)		357,144
Residential mortgage obligations		34,087		1,153		(138	)		33,072
Asset-backed securities		206,413		380		(964	)		206,997
Commercial mortgage-backed securities		206,318		6,630		(98	)		199,786
Subtotal	$	811,440	$	16,639	$	(2,198	)	$	796,999
Corporate bonds		615,564		13,048		(1,626	)		604,142
Total fixed maturities	$	2,365,934	$	52,322	$	(10,347	)	$	2,323,959
Equity securities - common stocks		127,183		28,520		(1,254	)		99,917
Equity securities - preferred stocks		57,112		2,236		(50	)		54,926
Short-term investments		179,506		—		(21	)		179,527
Cash		90,751		—		—			90,751
Total	$	2,820,486	$	83,078	$	(11,672	)	$	2,749,080

	December 31, 2013
In thousands	Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Amortized Cost
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds	$	441,685	$	2,854	$	(8,855	)	$	447,686
States, municipalities and political subdivisions		460,422		9,298		(13,651	)		464,775
Mortgage-backed and asset-backed securities:
Agency mortgage-backed securities		301,274		6,779		(6,016	)		300,511
Residential mortgage obligations		41,755		1,212		(161	)		40,704
Asset-backed securities		125,133		653		(480	)		124,960
Commercial mortgage-backed securities		172,750		7,656		(374	)		165,468
Subtotal	$	640,912	$	16,300	$	(7,031	)	$	631,643
Corporate bonds		504,854		15,402		(3,443	)		492,895
Total fixed maturities	$	2,047,873	$	43,854	$	(32,980	)	$	2,036,999
Equity securities - common stocks		143,954		25,700		(550	)		118,804
Short-term investments		296,250		—		—			296,250
Cash		86,509		—		—			86,509
Total	$	2,574,586	$	69,554	$	(33,530	)	$	2,538,562

Scheduled Maturity Dates for Fixed Maturity Securities by Number of Years Until Maturity

The contractual maturity dates for fixed maturities categorized by the number of years until maturity as of December 31, 2014 are shown in the following table:

	December 31, 2014
In thousands	Fair Value		Amortized Cost
Due in one year or less	$	63,670	$	65,643
Due after one year through five years		765,084		758,064
Due after five years through ten years		356,929		348,195
Due after ten years		368,811		355,058
Mortgage- and asset-backed securities		811,440		796,999
Total	$	2,365,934	$	2,323,959

Amount and Percentage of Fixed Maturities by Rating

The following table shows the amount and percentage of our Company’s fixed maturities as of December 31, 2014 by Standard & Poor’s (“S&P”) credit rating or, if an S&P rating is not available, the equivalent Moody’s Investor Services (“Moody’s”) rating. The table includes fixed maturities at fair value, and the total rating is the weighted average quality rating.

	December 31, 2014
In thousands	Rating	Fair Value		Percent of Total
Rating description:
Extremely strong	AAA	$	462,603		20	%
Very strong	AA		1,090,505		45	%
Strong	A		612,131		26	%
Adequate	BBB		185,372		8	%
Speculative	BB & Below		14,852		1	%
Not rated	NR		471		0	%
Total	AA	$	2,365,934		100	%

Summary of Aggregate Fair Value and Gross Unrealized Loss by Length of Time Securities had Continuously been in Gross Unrealized Loss Position as Well as Number of Securities

The following table summarizes all securities in a gross unrealized loss position as of December 31, 2014 and 2013, showing the aggregate fair value and gross unrealized loss by the length of time those securities had continuously been in a gross unrealized loss position as well as the relevant number of securities.

	December 31, 2014						December 31, 2013
In thousands, except # of securities	Number of Securities		Fair Value		Gross Unrealized Loss		Number of Securities		Fair Value		Gross Unrealized Loss
Fixed maturities:
U.S. Treasury bonds, agency bonds, and foreign government bonds
0-6 months		19	$	87,915	$	1,061		27	$	136,360	$	1,096
7-12 months		—		—		—		26		149,370		7,759
> 12 months		31		117,683		4,904		—		—		—
Subtotal		50	$	205,598	$	5,965		53	$	285,730	$	8,855
States, municipalities and political subdivisions
0-6 months		13	$	14,242	$	41		28	$	40,132	$	297
7-12 months		2		2,107		19		104		205,152		12,100
> 12 months		17		37,340		498		6		12,357		1,254
Subtotal		32	$	53,689	$	558		138	$	257,641	$	13,651
Agency mortgage-backed securities
0-6 months		4	$	14,743	$	52		39	$	39,458	$	434
7-12 months		2		4,138		28		64		77,860		3,768
> 12 months		46		58,301		918		9		22,784		1,814
Subtotal		52	$	77,182	$	998		112	$	140,102	$	6,016
Residential mortgage obligations
0-6 months		6	$	4,966	$	43		3	$	431	$	2
7-12 months		2		659		7		7		950		29
> 12 months		14		1,728		88		15		2,467		130
Subtotal		22	$	7,353	$	138		25	$	3,848	$	161
Asset-backed securities
0-6 months		19	$	96,123	$	354		14	$	75,887	$	479
7-12 months		3		14,152		185		1		203		1
> 12 months		3		34,530		425		—		—		—
Subtotal		25	$	144,805	$	964		15	$	76,090	$	480
Commercial mortgage-backed securities
0-6 months		4	$	18,665	$	65		4	$	6,712	$	31
7-12 months		1		1,076		6		2		15,098		322
> 12 months		3		1,391		27		4		774		21
Subtotal		8	$	21,132	$	98		10	$	22,584	$	374
Corporate bonds
0-6 months		52	$	179,390	$	797		34	$	93,591	$	717
7-12 months		4		11,071		74		18		55,021		2,726
> 12 months		14		31,126		755		—		—		—
Subtotal		70	$	221,587	$	1,626		52	$	148,612	$	3,443
Total fixed maturities		259	$	731,346	$	10,347		405	$	934,607	$	32,980
Equity securities - common stocks
0-6 months		6	$	9,152	$	761		5	$	7,387	$	422
7-12 months		1		3,887		486		2		3,538		128
> 12 months		1		238		7		—		—		—
		8	$	13,277	$	1,254		7	$	10,925	$	550
Equity securities - preferred stocks
0-6 months		7	$	6,651	$	50		—	$	—	$	—
7-12 months		—		—		—		—		—		—
> 12 months		—		—		—		—		—		—
		7	$	6,651	$	50		—	$	—	$	—
Total equity securities		15	$	19,928	$	1,304		7	$	10,925	$	550

Summary of Activity Related to Other-Than-Temporary Impairment Losses

The table below summarizes our Company’s activity related to OTTI losses for the periods indicated:

	Year Ended December 31,
	2014					2013				2012
In thousands, except # of securities	Number of Securities		Amount			Number of Securities		Amount		Number of Securities		Amount
Total OTTI losses:
Corporate and other bonds		—	$	—			1	$	1,822		—	$	—
Commercial mortgage-backed securities		—		—			—		—		—		—
Residential mortgage-backed securities		31		(137	)		—		—		1		55
Asset-backed securities		—		—			—		—		—		—
Equities		—		—			3		571		3		847
Total		31	$	(137	)		4	$	2,393		4	$	902
Less: Portion of loss in accumulated other comprehensive income (loss):
Corporate and other bonds			$	—				$	—			$	—
Commercial mortgage-backed securities				—					—				—
Residential mortgage-backed securities				(137	)				—				44
Asset-backed securities				—					—				—
Equities				—					—				—
Total			$	(137	)			$	—			$	44
Impairment losses recognized in earnings:
Corporate and other bonds			$	—				$	1,822			$	—
Commercial mortgage-backed securities				—					—				—
Residential mortgage-backed securities				—					—				11
Asset-backed securities				—					—				—
Equities				—					571				847
Total			$	—				$	2,393			$	858

Summary of Cumulative Amounts Related to Credit Loss Portion of Other-Than-Temporary Impairment Losses on Debt Securities

The following table summarizes the cumulative amounts related to our Company’s credit loss portion of the OTTI losses on fixed maturities for the years ended December 31, 2014, 2013 and 2012. Our Company does not intend to sell and it is more likely than not that it will not be required to sell, the securities prior to recovery of the amortized cost basis and for which the non-credit loss portion is included in AOCI.

	Year Ended December 31,
In thousands	2014			2013		2012
Beginning balance	$	5,154		$	3,332	$	3,321
Additions for credit loss impairments recognized in the current period on securities not previously impaired		—			1,822		—
Additions for credit loss impairments recognized in the current period on securities previously impaired		—			—		11
Reductions for credit loss impairments previously recognized on securities sold during the period		(2,793	)		—		—
Ending balance	$	2,361		$	5,154	$	3,332

Contractual Maturity by Number of Years Until Maturity for Fixed Maturity Securities with a Gross Unrealized Loss

The contractual maturity dates for fixed maturities categorized by the number of years until maturity, with a gross unrealized loss as of December 31, 2014 is presented in the following table:

	December 31, 2014
	Gross Unrealized Losses					Fair Value
In thousands	Amount		Percent of Total			Amount		Percent of Total
Due in one year or less	$	2,638		25	%	$	21,919		3	%
Due after one year through five years		3,791		37	%		334,046		46	%
Due after five years through ten years		1,562		15	%		103,376		14	%
Due after ten years		158		2	%		21,533		3	%
Mortgage- and asset-backed securities		2,198		21	%		250,472		34	%
Total	$	10,347		100	%	$	731,346		100	%

Net Investment Income

Our Company’s net investment income was derived from the following sources:

	Year Ended December 31,
In thousands	2014			2013			2012
Fixed maturities	$	57,219		$	53,898		$	58,995
Equity securities		9,036			4,835			3,945
Short-term investments		911			774			1,694
Total investment income		67,166			59,507			64,634
Investment expenses		(2,998	)		(3,256	)		(10,386	)
Net investment income	$	64,168		$	56,251		$	54,248

Change in Net Unrealized Gains/(Losses)

The change in net unrealized gains and losses, inclusive of the change in the non-credit portion of OTTI losses, consisted of:

	Year Ended December 31,
In thousands	2014		2013			2012
Fixed maturities	$	31,080	$	(76,194	)	$	15,709
Equity securities		4,302		8,857			(5,989	)
Gross unrealized gains (losses)		35,382		(67,337	)		9,720
Deferred income tax		12,197		(23,565	)		3,418
Change in net unrealized gains (losses), net	$	23,185	$	(43,772	)	$	6,302

Realized Gains and Losses, Excluding Net Other-Than-Temporary Impairment Losses Recognized in Earnings

Realized gains and losses, excluding net OTTI losses recognized in earnings, for the periods indicated, were as follows:

	Year Ended December 31,
In thousands	2014			2013			2012
Fixed maturities:
Gains	$	8,326		$	8,539		$	28,789
Losses		(2,610	)		(2,797	)		(1,915	)
Fixed maturities, net	$	5,716		$	5,742		$	26,874
Equity securities:
Gains	$	9,447		$	17,955		$	14,673
Losses		(2,351	)		(758	)		(473	)
Equity securities, net	$	7,096		$	17,197		$	14,200
Net realized gains (losses)	$	12,812		$	22,939		$	41,074

Fixed Maturities and Equity Securities by Asset Class that are Measured at Fair Value

The following tables present, for each of the fair value hierarchy levels as defined by the accounting guidance for fair value measurements and described below, our Company’s fixed maturities and equity securities by asset class that are measured at fair value on a recurring basis as of December 31, 2014 and 2013:

	December 31, 2014
In thousands	Level 1		Level 2		Level 3		Total
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds	$	146,904	$	251,019	$	—	$	397,923
States, municipalities and political subdivisions		—		541,007		—		541,007
Mortgage-backed and asset-backed securities:								—
Agency mortgage-backed securities		—		364,622		—		364,622
Residential mortgage obligations		—		34,087		—		34,087
Asset-backed securities		—		206,413		—		206,413
Commercial mortgage-backed securities		—		206,318		—		206,318
Subtotal	$	—	$	811,440	$	—	$	811,440
Corporate bonds		—		615,564		—		615,564
Total fixed maturities	$	146,904	$	2,219,030	$	—	$	2,365,934
Equity securities - common stocks		127,183				—		127,183
Equity securities - preferred stocks		—		57,112		—		57,112
Total	$	274,087	$	2,276,142	$	—	$	2,550,229

	December 31, 2013
In thousands	Level 1		Level 2		Level 3		Total
Fixed maturities:
U.S. Treasury bonds, agency bonds and foreign government bonds	$	242,379	$	199,306	$	—	$	441,685
States, municipalities and political subdivisions		—		460,422		—		460,422
Mortgage-backed and asset-backed securities:								—
Agency mortgage-backed securities		—		301,274		—		301,274
Residential mortgage obligations		—		41,755		—		41,755
Asset-backed securities		—		125,133		—		125,133
Commercial mortgage-backed securities		—		172,750		—		172,750
Subtotal	$	—	$	640,912	$	—	$	640,912
Corporate bonds		—		500,447		4,407		504,854
Total fixed maturities	$	242,379	$	1,801,087	$	4,407	$	2,047,873
Equity securities - common stocks		143,954		—		—		143,954
Total	$	386,333	$	1,801,087	$	4,407	$	2,191,827

Reconciliation of Beginning and Ending Balances for All Investments Measured at Fair Value Using Level 3 Inputs

The following tables present a reconciliation of the beginning and ending balances for all investments measured at fair value using Level 3 inputs for the years ended December 31, 2014 and 2013. For the year ended December 31, 2012, our Company did not have any Level 3 assets.

	Year Ended December 31, 2014
In thousands	Beginning Balance		Realized Gains (Losses)		Unrealized Gains (Losses)		Purchase		Sales		Settlements		Transfers into Level 3		Transfers out of Level 3			Ending
Assets:
Corporate Bond	$	4,407	$	—	$	—	$	—	$	—	$	—	$	—	$	(4,407	)	$	—
Total assets	$	4,407	$	—	$	—	$	—	$	—	$	—	$	—	$	(4,407	)	$	—

	Year Ended December 31, 2013
In thousands	Beginning Balance		Realized Gains (Losses)		Unrealized Gains (Losses)			Purchase		Sales			Settlements		Transfers into Level 3		Transfers out of Level 3		Ending
Assets:
Commercial
Mortgage	$	—	$	—	$	(42	)	$	4,660	$	(211	)	$	—	$	—	$	—	$	4,407
Total assets	$	—	$	—	$	(42	)	$	4,660	$	(211	)	$	—	$	—	$	—	$	4,407