Scheule II. Condensed Financial Information of Registrant (Notes)

12 Months Ended

Dec. 31, 2013

Condensed Financial Information of Registrant [Abstract]

Condensed Financial Information of Parent Company Only Disclosure [Text Block]

Condensed Financial Information of Registrant

THE NATIONAL SECURITY GROUP, INC. (PARENT COMPANY)
BALANCE SHEETS
(dollars in thousands)
	December 31,
	2013		2012
Assets
Fixed maturities available-for-sale, at estimated fair value	$	1,422	$	1,557
Investment real estate, at book value	356		1,457
Cash	948		58
Investment in subsidiaries (equity method) eliminated upon consolidation	49,565		49,407
Deferred income tax asset	5,866		6,706
Other assets	689		723
Total Assets	$	58,846	$	59,908
Liabilities and Shareholders' Equity
Liabilities
Accrued general expenses	$	1,722	$	1,529
Interest rate swaps	897		1,521
Notes payable	22,755		26,631
Total Liabilities	25,374		29,681
Total Shareholders' Equity	33,472		30,227
Total Liabilities and Shareholders' Equity	$	58,846	$	59,908

THE NATIONAL SECURITY GROUP, INC. (PARENT COMPANY)
STATEMENTS OF INCOME (LOSS)
(Dollars in thousands)
	Years Ended December 31,
	2013		2012
Income
Dividends (eliminated upon consolidation)	$	1,250	$	1,800
Property transfer from subsidiary	—		1,473
Net realized investment gains (losses)	3,308		72
Holding company management service fees	929		906
Other income	76		91
	5,563		4,342
Expenses
State taxes	41		42
Litigation settlement and defense costs	—		13,328
Interest	1,609		1,229
Other expenses	684		477
	2,334		15,076
Income (loss) before income taxes and equity in undistributed earnings of subsidiaries	3,229		(10,734		)
Income tax expense (benefit)	672		(4,697		)
Income (loss) before equity in undistributed earnings of subsidiaries	2,557		(6,037		)
Equity in undistributed earnings of subsidiaries	3,101		(634		)
Net income (loss)	$	5,658	$	(6,671	)

THE NATIONAL SECURITY GROUP, INC. (PARENT COMPANY)
STATEMENTS OF CASH FLOWS
(dollars in thousands)
	Years Ended
	December 31,
	2013			2012
Cash Flows from Operating Activities:
Net income (loss)	$	5,658		$	(6,671	)
Adjustments to reconcile net income (loss) to net cash provided by (used in)operating activities:
Equity in undistributed earnings of subsidiaries	(3,101		)	634
Net realized investment gains	(3,308		)	(72		)
Deferred income tax expense (benefit)	672			(4,697		)
Property transfer from subsidiary	—			(1,473		)
Other, net	246			(1,142		)
Net cash provided by (used in) operating activities	167			(13,421		)
Cash Flows from Investing Activities:
Net sales (purchases) of investments	4,847			(567		)
Net cash provided by (used in) investing activities	4,847			(567		)
Cash Flows from Financing Activities:
Net (repayments) proceeds from debt	(3,876		)	13,774
Cash dividends	(248		)	(802		)
Net cash (used in) provided by financing activities	(4,124		)	12,972
Net increase (decrease) in cash and cash equivalents	890			(1,016		)
Cash, at beginning of year	58			1,074
Cash, at end of year	$	948		$	58

Notes to Condensed Financial Information of Registrant

Note 1 - Basis of Presentation

Pursuant to the rules and regulations of the Securities and Exchange Commission, the Condensed Financial Information of the Registrant does not include all of the information and notes normally included with financial statements prepared in accordance with generally accepted accounting principles.  It is, therefore, suggested that this Condensed Financial Information be read in conjunction with the Consolidated Financial Statements and Notes thereto included in the Registrant’s Annual Report as referenced in Form 10-K, Part II, Item 8, page 40.

Note 2 - Cash Dividends and Asset Transfers from Insurance Subsidiaries

In 2013, cash dividends of $1.3 million were paid to the Registrant by its subsidiaries ($1.8 million in 2012). Also in 2012, timber property with a carrying value of $1.5 million was transferred to the Registrant from an insurance subsidiary.