Income Taxes (Tables)

12 Months Ended

Dec. 31, 2017

Components of Current and Deferred Income Tax Expense (Benefit)

The components of current and deferred income tax expense (benefit) are as follows:

	Years Ended December 31,
amounts in thousands	2017			2016			2015
Current Income Tax Expense (Benefit):
Federal and Foreign	$	42,427		$	39,900		$	27,937
State and Local		764			638			1,476
Subtotal	$	43,191		$	40,538		$	29,413
Deferred Income Tax Expense (Benefit):
Federal and Foreign	$	(8,879	)	$	(5,755	)	$	7,004
State and local		—			—			—
Subtotal	$	(8,879	)	$	(5,755	)	$	7,004
Total Income Tax Expense (Benefit)	$	34,312		$	34,783		$	36,417

Reconciliation of Total Income Taxes Applicable to Pre-Tax Operating Income and Amounts Computed by Applying Federal Statutory Income Tax Rate to Pre-Tax Operating Income

A reconciliation of total income taxes applicable to pre‑tax operating income and the amounts computed by applying the federal statutory income tax rate to the pre‑tax operating income were as follows:

	Years Ended December 31,
amounts in thousands	2017					2016						2015
Computed Expected Tax Expense	$	26,182		35.0	%	$	41,128			35.0	%	$	41,116			35.0	%
Tax-Exempt Interest		(5,394	)	(7.2	%)		(4,559	)		(3.9	%)		(4,987	)		(4.2	%)
Dividends Received Deduction		(4,689	)	(6.3	%)		(3,812	)		(3.2	%)		(2,086	)		(1.8	%)
Proration of DRD and Tax-Exempt Interest		1,512		2.0	%		1,256			1.1	%		1,061			0.9	%
Current State and Local Income Taxes, Net of Federal Income Tax Deduction		497		0.7	%		415			0.4	%		959			0.8	%
Stock Compensation Fair Market Value		(5,027	)	(6.7	%)	N/A			N/A			N/A			N/A
Change in Valuation Allowance		1,182		1.6	%		—			—			—			—
Deferred Tax Expense due to Tax Law Changes		17,107		22.9	%	N/A			N/A			N/A			N/A
Transition Tax		2,587		3.5	%	N/A			N/A			N/A			N/A
Other		355		0.4	%		355			0.2	%		354			0.3	%
Actual Tax Expense and Rate	$	34,312		45.9	%	$	34,783			29.6	%	$	36,417			31.0	%

N/A - Not applicable

Tax Effects of Temporary Differences That Give Rise to Federal, Foreign, State and Local Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of cumulative temporary differences that give rise to federal, foreign, state and local deferred tax assets and deferred tax liabilities were as follows:

	December 31,
amounts in thousands	2017			2016
Deferred Tax Assets:
Loss Reserve Discount	$	20,425		$	25,420
Unearned Premiums		24,352			33,886
Compensation Related		8,462			15,288
Lloyd's Year of Account Deferral		9,400			—
State and Local Net Deferred Tax Assets		616			699
Net Currency Translation Adjustments		2,084			5,363
Other		152			3,618
Total Gross Deferred Tax Assets	$	65,491		$	84,274
Less: Valuation Allowance		(1,798	)		(699	)
Total Deferred Tax Assets	$	63,693		$	83,575
Deferred Tax Liabilities:
Loss Reserve Discount - (Transition Rule)	$	(5,066	)	$	—
Net Unrealized Gains/Losses on Securities		(8,708	)		(10,142	)
Deferred Acquisition Costs		(20,670	)		(29,401	)
Lloyd's Year of Account Deferral		—			(15,471	)
Net Unrealized Foreign Exchange		(3,782	)		(3,575	)
Other		(3,196	)		(4,048	)
Total Deferred Tax Liabilities	$	(41,422	)	$	(62,637	)
Net Deferred Income Tax Asset (Liability)	$	22,271		$	20,938