Debt

9 Months Ended

Sep. 30, 2011

Debt [Abstract]

Debt

Note 4 - Debt

Indebtedness outstanding was as follows:

	September 30,			December 31,
	2011			2010
Short-term debt:
Bank Credit Facility		$	38,000		$	38,000
Long-term debt:
6.05% Senior Notes, due June 15, 2015. Aggregate principal amount of $75,000 less unaccrued discount of $98 and $118 (6.1% imputed rate)			74,902			74,882
6.85% Senior Notes, due April 15, 2016. Aggregate principal amount of $125,000 less unaccrued discount of $174 and $203 (6.9% imputed rate)			124,826			124,797
Total		$	237,728		$	237,679

The Bank Credit Facility, 6.05% Senior Notes due 2015 ("Senior Notes due 2015") and 6.85% Senior Notes due 2016 ("Senior Notes due 2016") are described in "Notes to Consolidated Financial Statements -- Note 5 -- Debt" of the Company's Annual Report on Form 10-K for the year ended December 31, 2010.

Credit Agreement with Financial Institutions ("Bank Credit Facility")

On May 31, 2005, HMEC entered into a Bank Credit Agreement by and between HMEC, certain financial institutions named therein and Bank of America, N.A., as administrative agent, that was amended and restated effective December 19, 2006 (the "Previous Bank Credit Agreement"). The Previous Bank Credit Agreement, which provided for unsecured borrowings of up to $125,000, was terminated on October 7, 2011 following HMEC's entry into the Current Bank Credit Facility and repayment of the $38,000 balance outstanding, as described below.

On October 7, 2011, HMEC entered into a new Bank Credit Agreement (the "Current Bank Credit Facility") that replaces the Previous Bank Credit Agreement, described above, which was scheduled to expire on December 19, 2011. The Current Bank Credit Facility is by and between HMEC, certain financial institutions named therein and JPMorgan Chase Bank, N.A., as administrative agent, provides for unsecured borrowings of up to $150,000 and expires on October 6, 2015.

On October 7, 2011, there was no change to HMEC's short-term debt balance. HMEC borrowed $38,000 under the Current Bank Credit Facility and used the proceeds to repay the $38,000 balance outstanding under the Previous Bank Credit Agreement.

Under the Current Bank Credit Facility, interest accrues at varying spreads relative to prime or eurodollar base rates and is payable monthly or quarterly depending on the applicable base rate (eurodollar base rate plus 1.25%, or 1.63%, as of October 7, 2011). The unused portion of the Current Bank Credit Facility is subject to a variable commitment fee, which was 0.15% on an annual basis at October 7, 2011.

The Current Bank Credit Facility contains financial covenants, as defined in the agreement, as follows: (1) debt to capital ratio not to exceed 35%, (2) minimum net worth and (3) insurance subsidiaries' risk based capital percentages of not less than 300%.