The following tables provide information relating to fixed maturities and equity securities (excluding investments classified as trading) as of the dates indicated:

		March 31, 2014

										Other-than-
					Gross		Gross			temporary
		Amortized			Unrealized		Unrealized	Fair		Impairments
		Cost			Gains		Losses	Value		in AOCI (3)

		(in thousands)
Fixed maturities, available-for-sale
U.S. Treasury securities and obligations of U.S.
	government authorities and agencies	$	6,374	$	19	$	26	$	6,367	$	-
Obligations of U.S. states and their political
	subdivisions		67,926		2,692		575		70,043		-
Foreign government bonds			25,298		6,355		-		31,653		-
Public utilities			240,630		23,106		1,436		262,300		-
Corporate securities			1,907,066		165,232		3,974		2,068,324		-
Asset-backed securities (1)			204,686		6,020		290		210,416		(41)
Commercial mortgage-backed securities			414,602		10,034		4,223		420,413		-
Residential mortgage-backed securities (2)			145,920		5,032		92		150,860		(40)
Total fixed maturities, available-for-sale		$	3,012,502	$	218,490	$	10,616	$	3,220,376	$	(81)

Equity securities, available-for-sale
Common Stocks:
	Public utilities	$	192	$	-	$	-	$	192
	Mutual funds		14		3		-		17
Total equity securities, available-for-sale		$	206	$	3	$	-	$	209

		December 31, 2013

										Other-than-
					Gross		Gross			temporary
		Amortized			Unrealized		Unrealized	Fair		Impairments
		Cost			Gains		Losses	Value		in AOCI (3)

		(in thousands)
Fixed maturities, available-for-sale
U.S. Treasury securities and obligations of U.S.
	government authorities and agencies	$	6,382	$	36	$	34	$	6,384	$	-
Obligations of U.S. states and their political
	subdivisions		67,225		2,911		1,570		68,566		-
Foreign government bonds			25,437		5,717		-		31,154		-
Public utilities			229,807		17,048		3,190		243,665		-
Corporate securities			2,029,720		158,360		9,103		2,178,977		-
Asset-backed securities (1)			182,888		6,513		1,509		187,892		(1,351)
Commercial mortgage-backed securities			384,764		11,387		5,518		390,633		-
Residential mortgage-backed securities (2)			152,779		5,138		972		156,945		(40)
Total fixed maturities, available-for-sale		$	3,079,002	$	207,110	$	21,896	$	3,264,216	$	(1,391)

Equity securities, available-for-sale
Common Stocks:
	Public utilities	$	192	$	-	$	-	$	192
	Mutual funds		14		2		-		16
Total equity securities, available-for-sale		$	206	$	2	$	-	$	208

The amortized cost and fair value of fixed maturities by contractual maturities at March 31, 2014, are as follows:

		Available-for-Sale
		Amortized		Fair
		Cost		Value

		(in thousands)
Due in one year or less		$	347,647	$	358,035
Due after one year through five years			938,910		1,011,996
Due after five years through ten years			553,767		605,703
Due after ten years			406,970		462,953
Asset-backed securities			204,686		210,416
Commercial mortgage-backed securities			414,602		420,413
Residential mortgage-backed securities			145,920		150,860
	Total	$	3,012,502	$	3,220,376

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations. Asset-backed, commercial mortgage-backed, and residential mortgage-backed securities are shown separately in the table above, as they are not due at a single maturity date.

The following table depicts the sources of fixed maturity proceeds and related investment gains / (losses), as well as losses on impairments of both fixed maturities and equity securities:

			Three Months Ended March 31,
			2014		2013

			(in thousands)
Fixed maturities, available-for-sale
	Proceeds from sales		$	52,030	$	114,927
	Proceeds from maturities/repayments			307,613		206,415
	Gross investment gains from sales, prepayments, and maturities			1,132		2,792
	Gross investment losses from sales and maturities			(326)		(80)
Equity securities, available-for-sale
	Proceeds from sales		$	-	$	1
	Gross investment gains from sales			-		1
Fixed maturity and equity security impairments
	Net writedowns for other-than-temporary impairment losses
		on fixed maturities recognized in earnings (1)	$	-	$	-

As discussed in Note 2 to the Company's Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, 2013, a portion of certain other-than-temporary-impairment (“OTTI”) losses on fixed maturity securities are recognized in “Other comprehensive income (loss)” (“OCI”). For these securities, the net amount recognized in earnings (“credit loss impairments”) represents the difference between the amortized cost of the security and the net present value of its projected future cash flows discounted at the effective interest rate implicit in the debt security prior to impairment. Any remaining difference between the fair value and amortized cost is recognized in OCI. The following table sets forth the amount of pre-tax credit loss impairments on fixed maturity securities held by the Company as of the dates indicated, for which a portion of the OTTI loss was recognized in OCI, and the corresponding changes in such amounts.

Credit losses recognized in earnings on fixed maturity securities held by the Company for which a portion of the OTTI loss was recognized in OCI


		Three Months Ended March 31,
		2014		2013

			(in thousands)

Balance, beginning of period		$	1,800	$	3,381
Credit loss impairments previously recognized on securities which matured, paid
	down, prepaid or were sold during the period		(1,673)		(1,614)
Increases due to the passage of time on previously recorded credit losses			-		27
Accretion of credit loss impairments previously recognized due to an increase in
	cash flows expected to be collected		(8)		(68)
Balance, end of period		$	119	$	1,726

The following table sets forth the composition of “Trading account assets” as of the dates indicated:

The net change in unrealized gains / (losses) from trading account assets still held at period end, recorded within “Asset administration fees and other income”, was $0.1 million and $0.4 million during the three months ended March 31, 2014 and 2013, respectively.

The Company's commercial mortgage and other loans are comprised as follows, as of the dates indicated:

			March 31, 2014					December 31, 2013
			Amount		% of			Amount		% of
			(in thousands)		Total			(in thousands)		Total

Commercial and agricultural mortgage loans by property type:
Apartments/Multi-Family			$	133,174		32.8	%	$	125,045		31.5	%
Industrial				83,870		20.7			88,009		22.1
Retail				71,822		17.7			72,325		18.2
Office				44,696		11.0			40,976		10.3
Other				14,466		3.6			13,796		3.5
Hospitality				5,122		1.3			5,133		1.3

	Total commercial mortgage loans			353,150		87.0			345,284		86.9
Agricultural property loans				52,556		13.0			52,223		13.1
	Total commercial and agricultural mortgage loans by property
		type		405,706		100.0	%		397,507		100.0	%
Valuation allowance				(1,256)					(1,256)

	Total net commercial and agricultural mortgage loans by property
		type		404,450					396,251

Other Loans
Uncollateralized loans				2,740					2,740

	Total other loans			2,740					2,740

	Total commercial mortgage and other loans		$	407,190				$	398,991

The commercial mortgage and agricultural property loans are geographically dispersed throughout the United States with the largest concentrations in California (17%), Texas (11%) and Ohio (9%) at March 31, 2014.

Activity in the allowance for losses for all commercial mortgage and other loans, as of the dates indicated, is as follows:

The following tables set forth the allowance for credit losses and the recorded investment in commercial mortgage and other loans as of the dates indicated:

	March 31, 2014		December 31, 2013

	(in thousands)
Allowance for Credit Losses:
Ending balance: individually evaluated for impairment (1)	$	-	$	-
Ending balance: collectively evaluated for impairment (2)		1,256		1,256
Total ending balance	$	1,256	$	1,256

Recorded Investment (3):
Ending balance gross of reserves: individually evaluated for impairment (1)	$	-	$	-
Ending balance gross of reserves: collectively evaluated for impairment (2)		408,446		400,247
Total ending balance, gross of reserves	$	408,446	$	400,247

Impaired loans include those loans for which it is probable that all amounts due will not be collected according to the contractual terms of the loan agreement. There were no impaired commercial mortgage and other loans identified in management's specific review of probable loan losses and the related allowance for losses at March 31, 2014 and December 31, 2013. There were no recorded investments in impaired loans with an allowance recorded, before the allowance for losses, at both March 31, 2014 and December 31, 2013.

Impaired commercial mortgage and other loans with no allowance for losses are loans in which the fair value of the collateral or the net present value of the loans' expected future cash flows equals or exceeds the recorded investment. The Company had no such loans at March 31, 2014 and December 31, 2013. See Note 2 to the Company's Financial Statements included in its Annual Report on Form 10-K for the year ended December 31, 2013, for information regarding the Company's accounting policies for non-performing loans.

The following table sets forth the credit quality indicators as of March 31, 2014, based upon the recorded investment gross of allowance for credit losses.

		Debt Service Coverage Ratio - March 31, 2014
		Greater than 1.2X		1.0X to <1.2X		Less than 1.0X		Total

Loan-to-Value Ratio			(in thousands)
0%-59.99%		$	262,918	$	7,412	$	1,551	$	271,881
60%-69.99%			101,075		-		-		101,075
70%-79.99%			29,634		-		-		29,634
Greater than 80%			3,116		-		-		3,116
	Total commercial and agricultural mortgage loans	$	396,743	$	7,412	$	1,551	$	405,706

The following table sets forth the credit quality indicators as of December 31, 2013, based upon the recorded investment gross of allowance for credit losses.

		Debt Service Coverage Ratio - December 31, 2013
		Greater than 1.2X		1.0X to <1.2X		Less than 1.0X		Total

Loan-to-Value Ratio		(in thousands)
0%-59.99%		$	251,278	$	7,650	$	1,865	$	260,793
60%-69.99%			102,755		-		-		102,755
70%-79.99%			31,712		2,247		-		33,959
Greater than 80%			-		-		-		-
	Total commercial and agricultural mortgage loans	$	385,745	$	9,897	$	1,865	$	397,507

As of March 31, 2014 and December 31, 2013, all commercial mortgage and other loans were in current status. The Company defines current in its aging of past due commercial mortgage and agricultural loans as less than 30 days past due.

There were no commercial mortgage and other loans in nonaccrual status as of March 31, 2014 and December 31, 2013. Nonaccrual loans are those on which the accrual of interest has been suspended after the loans become 90 days delinquent as to principal or interest payments, or earlier when the Company has doubts about collectability and loans for which a loan-specific reserve has been established. See Note 2 to the Company's Financial Statements included in its Annual Report on Form 10-K for the year ended December 31, 2013, for further discussion regarding non-accrual status loans.

For the three months ended both March 31, 2014 and 2013, there were no new commercial mortgage and other loans acquired, other than those through direct origination.

The Company's commercial mortgage and other loans may occasionally be involved in a troubled debt restructuring. As of both March 31, 2014 and December 31, 2013, the Company had no significant commitments to fund to borrowers that have been involved in a troubled debt restructuring. During the three months ended March 31, 2014 and 2013, respectively, there were no new troubled debt restructurings related to commercial mortgage loans, and no payment defaults on commercial mortgage and other loans that were modified as a troubled debt restructuring with the 12 months preceding each respective period. For additional information relating to the accounting for troubled debt restructurings, see Note 2 to the Company's Financial Statements included in the Annual Report on Form 10-K for the year ended December 31, 2013.

Net investment income for the three months ended March 31, 2014 and 2013, was from the following sources:

		Three Months Ended
		March 31,
		2014		2013

		(in thousands)
Fixed maturities, available-for-sale		$	38,376	$	53,294
Trading account assets			9		32
Commercial mortgage and other loans			6,166		6,128
Policy loans			127		114
Short-term investments			57		82
Other long-term investments			1,213		691
	Gross investment income		45,948		60,341
Less: investment expenses			(1,447)		(1,801)
	Net investment income	$	44,501	$	58,540

Realized investment gains (losses), net, for the three months ended March 31, 2014 and 2013, were from the following sources:

		Three Months Ended
			March 31,
		2014		2013

		(in thousands)
Fixed maturities		$	806	$	2,712
Equity securities			-		1
Commercial mortgage and other loans			-		38
Derivatives			(977)		(40,826)
Other			-		(21)
	Realized investment gains (losses), net	$	(171)	$	(38,096)

The balance of and changes in each component of “Accumulated other comprehensive income (loss)” for the three months ended March 31, 2014 and 2013 are as follows:

		Accumulated Other Comprehensive Income (Loss)
			Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses) (1)		Total Accumulated Other Comprehensive Income (Loss)

		(in thousands)
Balance, December 31, 2013		$	10	$	70,857	$	70,867
Change in other comprehensive income
	before reclassifications		(1)		20,191		20,190
Amounts reclassified from AOCI			-		(806)		(806)
Income tax benefit (expense)			-		(6,785)		(6,785)
Balance, March 31, 2014		$	9	$	83,457	$	83,466


		Accumulated Other Comprehensive Income (Loss)
			Foreign Currency Translation Adjustment		Net Unrealized Investment Gains (Losses) (1)		Total Accumulated Other Comprehensive Income (Loss)
		(in thousands)
Balance, December 31, 2012		$	7	$	147,280	$	147,287
Change in other comprehensive income
	before reclassifications		(15)		(11,298)		(11,313)
Amounts reclassified from AOCI			-		(2,713)		(2,713)
Income tax benefit (expense)			5		4,904		4,909
Balance, March 31, 2013		$	(3)	$	138,173	$	138,170

Reclassifications out of Accumulated Other Comprehensive Income (Loss)

Three Months

Ended

March 31, 2014

(in thousands)

Amounts reclassified from AOCI (1)(2):

Net unrealized investment gains (losses):

Cash flow hedges - Currency/Interest rate (3)

(15)

Net unrealized investment gains (losses) on available-for-sale securities

821

Total net unrealized investment gains (losses) (4)

806

Total reclassifications for the period

806

Net unrealized investment gains and losses on securities classified as available-for-sale and certain other long-term investments and other assets are included in the Company's Unaudited Interim Statements of Financial Position as a component of AOCI. Changes in these amounts include reclassification adjustments to exclude from “Other comprehensive income (loss)” those items that are included as part of “Net income” for a period that had been part of “Other comprehensive income (loss)” in earlier periods. The amounts for the periods indicated below, split between amounts related to fixed maturity securities on which an OTTI loss has been recognized, and all other net unrealized investment gains and losses, are as follows:

Net Unrealized Investment Gains and Losses on Fixed Maturity Securities on which an OTTI loss has been recognized

		Net Unrealized Gains (Losses) on Investments		Deferred Policy Acquisition Costs and Other Costs		Future Policy Benefits		Deferred Income Tax (Liability) Benefit		Accumulated Other Comprehensive Income (Loss) Related to Net Unrealized Investment Gains (Losses)

		(in thousands)
Balance, December 31, 2013		$	323	$	(116)	$	(14)	$	(51)	$	142
Net investment gains (losses) on investments
	arising during the period		8		-		-		(3)		5
Reclassification adjustment for (gains) losses
	included in net income		(282)		-		-		98		(184)
Impact of net unrealized investment (gains) losses on
	deferred policy acquisition costs
	and other costs		-		100		-		(36)		64
Impact of net unrealized investment (gains) losses on
	future policy benefits		-		-		12		(4)		8
Balance, March 31, 2014		$	49	$	(16)	$	(2)	$	4	$	35

										Accumulated Other
										Comprehensive
								Deferred		Income (Loss) Related
		Net Unrealized		Deferred Policy		Future		Income Tax		To Net Unrealized
		Gains (Losses) on		Acquisition Costs		Policy		(Liability)		Investment
		Investments (1)		and Other Costs		Benefits		Benefit		Gains (Losses)

		(in thousands)
Balance, December 31, 2013		$	184,727	$	(66,452)	$	(8,187)	$	(39,363)	$	70,725
Net investment gains (losses) on investments
	arising during the period		24,132		-		-		(8,450)		15,682
Reclassification adjustment for (gains) losses
	included in net income		(524)		-		-		182		(342)
Impact of net unrealized investment (gains)
	losses on deferred policy acquisition costs
	and other costs		-		(3,128)		-		1,093		(2,035)
Impact of net unrealized investment (gains)
	losses on future policy benefits		-		-		(933)		325		(608)
Balance, March 31, 2014		$	208,335	$	(69,580)	$	(9,120)	$	(46,213)	$	83,422

The table below presents net unrealized gains / (losses) on investments by asset class as of the dates indicated:

	March 31,		December 31,
	2014		2013

	(in thousands)
Fixed maturity securities on which an OTTI loss has been recognized	$	49	$	323
Fixed maturity securities, available-for-sale - all other		207,825		184,891
Equity securities, available-for-sale		3		2
Affiliated notes		2,955		3,113
Derivatives designated as cash flow hedges (1)		(3,016)		(3,653)
Other investments		568		374
Net Unrealized gains (losses) on investments	$	208,384	$	185,050

Duration of Gross Unrealized Loss Positions for Fixed Maturities and Equity Securities

The following table shows the fair value and gross unrealized losses aggregated by investment category and length of time that individual fixed maturity securities and equity securities have been in a continuous unrealized loss position, as of the dates indicated:

			March 31, 2014
			Less than twelve months				Twelve months or more				Total

			Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses

			(in thousands)
Fixed maturities, available-for-sale
U.S. Treasury securities and obligations of
	U.S. government authorities and agencies		$	3,234	$	26	$	-	$	-	$	3,234	$	26
Obligations of U.S. States and their
	political subdivisions			-		-		6,794		575		6,794		575
Corporate securities				312,686		4,997		6,004		413		318,690		5,410
Asset-backed securities				36,910		276		986		14		37,896		290
Commercial mortgage-backed securities				100,400		3,751		6,502		472		106,902		4,223
Residential mortgage-backed securities				77,385		92		-		-		77,385		92
		Total	$	530,615	$	9,142	$	20,286	$	1,474	$	550,901	$	10,616

Equity securities, available-for-sale			$	-	$	-	$	-	$	-	$	-	$	-

			December 31, 2013
			Less than twelve months				Twelve months or more				Total

			Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses		Fair Value		Gross Unrealized Losses

			(in thousands)
Fixed maturities, available-for-sale
U.S. Treasury securities and obligations of
	U.S. government authorities and agencies		$	3,347	$	34	$	-	$	-	$	3,347	$	34
Obligations of U.S. States and their
	political subdivisions			5,420		588		6,402		982		11,822		1,570
Corporate securities				351,306		11,923		2,704		370		354,010		12,293
Asset-backed securities				97,575		1,509		-		-		97,575		1,509
Commercial mortgage-backed securities				86,132		5,249		2,941		269		89,073		5,518
Residential mortgage-backed securities				100,150		972		-		-		100,150		972
		Total	$	643,930	$	20,275	$	12,047	$	1,621	$	655,977	$	21,896

Equity securities, available-for-sale			$	-	$	-	$	-	$	-	$	-	$	-

The gross unrealized losses on fixed maturity securities at March 31, 2014 and December 31, 2013, are composed of $9.8 million and $20.4 million, related to high or highest quality securities based on The National Association of Insurance Commissioners (“NAIC”) or equivalent rating and $0.8 million and $1.5 million, respectively, related to other than high or highest quality securities based on NAIC or equivalent rating. At March 31, 2014, none of the gross unrealized losses represented declines in value of greater than 20%, as compared to December 31, 2013, when $0.2 million of the gross unrealized losses represented declines in value of greater than 20%, all of which had been in that position for less than six months. At March 31, 2014, $1.5 million of gross unrealized losses of twelve months or more were concentrated in U.S. obligations, commercial mortgage-backed securities, and the consumer non-cyclical and finance sectors of the Company's corporate securities. At December 31, 2013, $1.6 million of gross unrealized losses of twelve months or more were concentrated in U.S. obligations and the consumer non-cyclical sector of the Company's corporate securities.

In accordance with its policy described in Note 2 to the Company's Financial Statements included in its 2013 Annual Report on Form 10-K, the Company concluded that an adjustment to earnings for other-than-temporary impairments for these securities was not warranted at March 31, 2014 or December 31, 2013. These conclusions are based on a detailed analysis of the underlying credit and cash flows on each security. The gross unrealized losses are primarily attributable to credit spread widening and increased liquidity discounts. At March 31, 2014, the Company does not intend to sell the securities and it is not more likely than not that the Company will be required to sell the securities before the anticipated recovery of its remaining amortized cost basis.