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Investments (Tables)
 12 Months Ended
Dec. 31, 2018
Investments Debt And Equity Securities [Abstract]  
Available-for-Sale Investments Including Other-Than-Temporarily Impaired Securities Recognized within Accumulated Other Comprehensive Income

The following tables set forth our Company’s available-for-sale investments and Equity Securities as of December 31, 2018 and 2017 and include OTTI securities recognized within AOCI:

 

 

 

December 31, 2018

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

 

 

 

 

 

Unrealized

 

 

Unrealized

 

 

Amortized

 

amounts in thousands

 

Fair Value

 

 

Gains

 

 

Losses

 

 

Cost

 

Fixed Maturities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Bonds, Agency Bonds and Foreign

   Government Bonds

 

$

239,776

 

 

$

901

 

 

$

(3,957

)

 

$

242,832

 

States, Municipalities and Political Subdivisions

 

 

646,551

 

 

 

10,734

 

 

 

(3,448

)

 

 

639,265

 

Mortgage-Backed and Asset-Backed Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agency Residential Mortgage-Backed Securities

 

 

335,542

 

 

 

843

 

 

 

(13,118

)

 

 

347,817

 

Residential Mortgage Obligations

 

 

138,373

 

 

 

604

 

 

 

(530

)

 

 

138,299

 

Asset-Backed Securities

 

 

531,991

 

 

 

1,018

 

 

 

(8,040

)

 

 

539,013

 

Commercial Mortgage-Backed Securities

 

 

188,201

 

 

 

858

 

 

 

(2,816

)

 

 

190,159

 

Subtotal

 

$

1,194,107

 

 

$

3,323

 

 

$

(24,504

)

 

$

1,215,288

 

Corporate Exposures (1)

 

 

1,002,489

 

 

 

3,101

 

 

 

(28,640

)

 

 

1,028,028

 

Total Fixed Maturities

 

$

3,082,923

 

 

$

18,059

 

 

$

(60,549

)

 

$

3,125,413

 

Short-Term Investments

 

 

10,233

 

 

 

—

 

 

 

(1

)

 

 

10,234

 

Total Available-For-Sale Investments

 

$

3,093,156

 

 

$

18,059

 

 

$

(60,550

)

 

$

3,135,647

 

 

(1) - Corporate Exposures consist of investments in corporate bonds, hybrid bonds and redeemable preferred stocks.

  

 

December 31, 2017

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

 

 

 

 

 

Unrealized

 

 

Unrealized

 

 

Amortized

 

amounts in thousands

 

Fair Value

 

 

Gains

 

 

Losses

 

 

Cost

 

Fixed Maturities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Bonds, Agency Bonds and Foreign

   Government Bonds

 

$

393,563

 

 

$

2,081

 

 

$

(2,014

)

 

$

393,496

 

States, Municipalities and Political Subdivisions

 

 

814,632

 

 

 

20,136

 

 

 

(1,423

)

 

 

795,919

 

Mortgage-Backed and Asset-Backed Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agency Residential Mortgage-Backed Securities

 

 

407,619

 

 

 

2,352

 

 

 

(5,414

)

 

 

410,681

 

Residential Mortgage Obligations

 

 

54,104

 

 

 

606

 

 

 

(79

)

 

 

53,577

 

Asset-Backed Securities

 

 

328,753

 

 

 

2,138

 

 

 

(663

)

 

 

327,278

 

Commercial Mortgage-Backed Securities

 

 

160,904

 

 

 

2,354

 

 

 

(1,182

)

 

 

159,732

 

Subtotal

 

$

951,380

 

 

$

7,450

 

 

$

(7,338

)

 

$

951,268

 

Corporate Exposures (1)

 

 

897,479

 

 

 

14,491

 

 

 

(3,737

)

 

 

886,725

 

Total Fixed Maturities

 

$

3,057,054

 

 

$

44,158

 

 

$

(14,512

)

 

$

3,027,408

 

Equity Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stocks

 

$

52,439

 

 

$

7,423

 

 

$

(112

)

 

$

45,128

 

Preferred Stocks

 

 

183,542

 

 

 

6,071

 

 

 

(1,560

)

 

 

179,031

 

Total Equity Securities

 

$

235,981

 

 

$

13,494

 

 

$

(1,672

)

 

$

224,159

 

Short-Term Investments (2)

 

 

6,480

 

 

 

3

 

 

 

—

 

 

 

6,477

 

Total Available-For-Sale Investments

 

$

3,299,515

 

 

$

57,655

 

 

$

(16,184

)

 

$

3,258,044

 

 

(1) - Corporate Exposures consist of investments in corporate bonds, hybrid bonds and redeemable preferred stocks.

(2) - Cash and overseas deposits that were misclassified within Short-Term Investments prior to 2018 were reclassified, representing an immaterial correction. Refer to Note 1 Organization & Summary of Significant Accounting Policies for further information.
Equity Securities At Fair Value [Table Text Block]

 

 

 

As of December 31, 2018

 

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

 

Fair

 

 

Unrealized

 

 

Unrealized

 

 

 

 

 

amounts in thousands

 

Value

 

 

Gains

 

 

(Losses)

 

 

Cost

 

Equity Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stocks

 

$

166,353

 

 

$

4,738

 

 

$

(15,984

)

 

$

177,599

 

Preferred Stocks

 

 

173,539

 

 

 

511

 

 

 

(10,791

)

 

 

183,819

 

Total Equity Securities

 

$

339,892

 

 

$

5,249

 

 

$

(26,775

)

 

$

361,418

 

 
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, 2018 are shown in the following table:

 

  

 

December 31, 2018

 

 

 

 

 

 

 

Amortized

 

amounts in thousands

 

Fair Value

 

 

Cost

 

Due in One Year or Less

 

$

183,390

 

 

$

184,761

 

Due after One Year Through Five Years

 

 

793,254

 

 

 

801,841

 

Due After Five Years Through Ten Years

 

 

370,056

 

 

 

368,933

 

Due After Ten Years

 

 

542,116

 

 

 

554,592

 

Mortgage-Backed and Asset-Backed Securities

 

 

1,194,107

 

 

 

1,215,286

 

Total

 

$

3,082,923

 

 

$

3,125,413

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

The following tables summarize all securities available-for-sale in a gross unrealized loss position as of December 31, 2018 and 2017, showing the aggregate fair value and gross unrealized loss by the length of time those securities have continuously been in a gross unrealized loss position:

 

 

 

December 31, 2018

 

 

 

Less than 12 months

 

 

Greater than 12 months

 

 

 

 

Total

 

 

 

 

 

 

 

Gross

 

 

 

 

 

 

Gross

 

 

 

 

 

 

 

 

Gross

 

 

 

Fair

 

 

Unrealized

 

 

Fair

 

 

Unrealized

 

 

 

 

Fair

 

 

Unrealized

 

amounts in thousands

 

Value

 

 

(Losses)

 

 

Value

 

 

(Losses)

 

 

 

 

Value

 

 

(Losses)

 

Fixed Maturities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Bonds, Agency Bonds and Foreign

   Government Bonds

 

$

101,395

 

 

$

(2,486

)

 

$

112,195

 

 

$

(1,471

)

 

 

 

$

213,590

 

 

$

(3,957

)

States, Municipalities and Political Subdivisions

 

 

123,479

 

 

 

(1,274

)

 

 

105,405

 

 

 

(2,174

)

 

 

 

 

228,884

 

 

 

(3,448

)

Mortgage-Backed and Asset-Backed Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agency Residential Mortgage-Backed Securities

 

 

34,819

 

 

 

(814

)

 

 

270,997

 

 

 

(12,304

)

 

 

 

 

305,816

 

 

 

(13,118

)

Residential Mortgage Obligations

 

 

70,965

 

 

 

(249

)

 

 

10,110

 

 

 

(281

)

 

 

 

 

81,075

 

 

 

(530

)

Asset-Backed Securities

 

 

345,437

 

 

 

(6,950

)

 

 

77,362

 

 

 

(1,090

)

 

 

 

 

422,799

 

 

 

(8,040

)

Commercial Mortgage-Backed Securities

 

 

58,877

 

 

 

(282

)

 

 

41,477

 

 

 

(2,534

)

 

 

 

 

100,354

 

 

 

(2,816

)

Subtotal

 

$

510,098

 

 

$

(8,295

)

 

$

399,946

 

 

$

(16,209

)

 

 

 

$

910,044

 

 

$

(24,504

)

Corporate Exposures (1)

 

 

481,057

 

 

 

(15,456

)

 

 

300,113

 

 

 

(13,184

)

 

 

 

 

781,170

 

 

 

(28,640

)

Total Fixed Maturities

 

$

1,216,029

 

 

$

(27,511

)

 

$

917,659

 

 

$

(33,038

)

 

 

 

$

2,133,688

 

 

$

(60,549

)

 

(1) - Corporate Exposures consist of investments in corporate bonds, hybrid bonds and redeemable preferred stocks.

 

  

 

December 31, 2017

 

 

 

Less than 12 months

 

 

Greater than 12 months

 

 

 

 

Total

 

 

 

 

 

 

 

Gross

 

 

 

 

 

 

Gross

 

 

 

 

 

 

 

 

Gross

 

 

 

Fair

 

 

Unrealized

 

 

Fair

 

 

Unrealized

 

 

 

 

Fair

 

 

Unrealized

 

amounts in thousands

 

Value

 

 

(Losses)

 

 

Value

 

 

(Losses)

 

 

 

 

Value

 

 

(Losses)

 

Fixed Maturities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury Bonds, Agency Bonds and Foreign

   Government Bonds

 

$

273,672

 

 

$

(1,502

)

 

$

54,484

 

 

$

(512

)

 

 

 

$

328,156

 

 

$

(2,014

)

States, Municipalities and Political Subdivisions

 

 

74,097

 

 

 

(503

)

 

 

45,085

 

 

 

(920

)

 

 

 

 

119,182

 

 

 

(1,423

)

Mortgage-Backed and Asset-Backed Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Agency Residential Mortgage-Backed Securities

 

 

87,496

 

 

 

(346

)

 

 

236,745

 

 

 

(5,068

)

 

 

 

 

324,241

 

 

 

(5,414

)

Residential Mortgage Obligations

 

 

12,418

 

 

 

(62

)

 

 

546

 

 

 

(17

)

 

 

 

 

12,964

 

 

 

(79

)

Asset-Backed Securities

 

 

85,877

 

 

 

(468

)

 

 

24,733

 

 

 

(195

)

 

 

 

 

110,610

 

 

 

(663

)

Commercial Mortgage-Backed Securities

 

 

20,482

 

 

 

(95

)

 

 

22,903

 

 

 

(1,087

)

 

 

 

 

43,385

 

 

 

(1,182

)

Subtotal

 

$

206,273

 

 

$

(971

)

 

$

284,927

 

 

$

(6,367

)

 

 

 

$

491,200

 

 

$

(7,338

)

Corporate Exposures (1)

 

 

295,433

 

 

 

(1,690

)

 

 

121,410

 

 

 

(2,047

)

 

 

 

 

416,843

 

 

 

(3,737

)

Total Fixed Maturities

 

$

849,475

 

 

$

(4,666

)

 

$

505,906

 

 

$

(9,846

)

 

 

 

$

1,355,381

 

 

$

(14,512

)

Equity Securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stocks

 

$

11,245

 

 

$

(81

)

 

$

1,770

 

 

$

(31

)

 

 

 

$

13,015

 

 

$

(112

)

Preferred Stocks

 

 

50,861

 

 

 

(1,524

)

 

 

662

 

 

 

(36

)

 

 

 

 

51,523

 

 

 

(1,560

)

Total Equity Securities

 

$

62,106

 

 

$

(1,605

)

 

$

2,432

 

 

$

(67

)

 

 

 

$

64,538

 

 

$

(1,672

)

Total Fixed Maturities and Equity Securities

 

$

911,581

 

 

$

(6,271

)

 

$

508,338

 

 

$

(9,913

)

 

 

 

$

1,419,919

 

 

$

(16,184

)

 

(1) - Corporate Exposures consist of investments in corporate bonds, hybrid bonds and redeemable preferred stocks.
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, 2018, 2017 and 2016.

 

  

 

Years Ended December 31,

 

amounts in thousands

 

2018

 

 

2017

 

 

2016

 

Beginning Balance

 

$

2,361

 

 

$

2,361

 

 

$

2,361

 

Additions for Credit Loss Impairments recognized in the

   current period on securities not previously impaired

 

 

—

 

 

 

—

 

 

 

150

 

Additions for Credit Loss Impairments recognized in the

   current period on securities previously impaired

 

 

—

 

 

 

—

 

 

 

—

 

Reductions for Credit Loss Impairments previously

   recognized on securities sold during the period

 

 

(17

)

 

 

—

 

 

 

(150

)

Ending Balance

 

$

2,344

 

 

$

2,361

 

 

$

2,361

 
Net Investment Income

Our Company’s Net Investment Income was derived from the following sources:

 

 

 

Years Ended December 31,

 

amounts in thousands

 

2018

 

 

2017

 

 

2016

 

Fixed Maturities

 

$

90,101

 

 

$

76,784

 

 

$

67,772

 

Equity Securities

 

 

13,807

 

 

 

15,108

 

 

 

14,271

 

Short-Term Investments, Cash and Cash Equivalents (1)

 

 

1,676

 

 

 

428

 

 

 

317

 

Other Invested Assets (1)

 

 

666

 

 

 

636

 

 

 

410

 

Total Investment Income

 

$

106,250

 

 

$

92,956

 

 

$

82,770

 

Investment Expenses

 

 

(3,137

)

 

 

(3,663

)

 

 

(3,319

)

Net Investment Income

 

$

103,113

 

 

$

89,293

 

 

$

79,451

 

 

(1) - Cash and overseas deposits that were misclassified within Short-Term Investments prior to 2018 were reclassified, representing an immaterial correction. Refer to Note 1 Organization & Summary of Significant Accounting Policies for further information.
Realized Gains and Losses on Investments Sold, 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:

 

 

 

Years Ended December 31,

 

amounts in thousands

 

2018

 

 

2017

 

 

2016

 

Fixed Maturities:

 

 

 

 

 

 

 

 

 

 

 

 

Gains

 

$

3,775

 

 

$

4,041

 

 

$

5,681

 

Losses

 

 

(1,306

)

 

 

(3,249

)

 

 

(4,271

)

Fixed Maturities, Net

 

$

2,469

 

 

$

792

 

 

$

1,410

 

Short-Term Investments, Cash and Cash Equivalents: (1)

 

 

 

 

 

 

 

 

 

 

 

 

Gains

 

$

208

 

 

$

1,575

 

 

$

871

 

Losses

 

 

(319

)

 

 

(243

)

 

 

(1,444

)

Short-Term, Net

 

$

(111

)

 

$

1,332

 

 

$

(573

)

Other Invested Assets: (1)

 

 

 

 

 

 

 

 

 

 

 

 

Gains

 

$

92

 

 

$

56

 

 

$

19

 

Losses

 

 

(213

)

 

 

(369

)

 

 

(108

)

Other Invested Assets, Net

 

$

(121

)

 

$

(313

)

 

$

(89

)

Equity Securities:

 

 

 

 

 

 

 

 

 

 

 

 

Gains

 

$

1,102

 

 

$

44,783

 

 

$

9,096

 

Losses

 

 

(350

)

 

 

(1,521

)

 

 

(658

)

Equity Securities, Net

 

$

752

 

 

$

43,262

 

 

$

8,438

 

Net Realized Gains on Investments Sold

 

$

2,989

 

 

$

45,073

 

 

$

9,186

 

(1) - Cash and overseas deposits that were misclassified within Short-Term Investments prior to 2018 were reclassified, representing an immaterial correction. Refer to Note 1 Organization & Summary of Significant Accounting Policies for further information.
Portion of Net Unrealized Losses Recognized to Equity Securities

The following table presents the portion of Net Unrealized Losses recognized during the year that relates to Equity Securities held as of December 31, 2018:

 

amounts in thousands

 

 

Year Ended

December 31, 2018

 

Equity Securities:

 

 

 

 

 

Total Net Realized and Unrealized Losses recognized

 

 

$

(32,585

)

Less: Net Realized Gains on Investments Sold

 

 

 

752

 

Net Unrealized Losses recognized

 

 

$

(33,337

)