|
Investments (Tables)
|
9 Months Ended |
|
Sep. 30, 2014
|
| Investments Debt And Equity Securities [Abstract] |
|
| Investment Holdings by Type of Instrument |
The following table presents the Company’s investment holdings by type of instrument as of the dates presented (in thousands):
|
|
September 30, 2014 |
|
|
December 31, 2013 |
|
|
|
Cost or |
|
|
|
|
|
|
|
|
|
|
Cost or |
|
|
|
|
|
|
|
|
|
|
|
Amortized |
|
|
|
|
|
|
Carrying |
|
|
Amortized |
|
|
|
|
|
|
Carrying |
|
|
|
Cost |
|
|
Fair Value |
|
|
Value |
|
|
Cost |
|
|
Fair Value |
|
|
Value |
|
|
Cash and cash equivalents (1) |
$ |
170,352 |
|
|
$ |
170,352 |
|
|
$ |
170,352 |
|
|
$ |
117,275 |
|
|
$ |
117,275 |
|
|
$ |
117,275 |
|
|
Restricted cash and cash equivalents |
|
6,597 |
|
|
|
6,597 |
|
|
|
6,597 |
|
|
|
2,600 |
|
|
|
2,600 |
|
|
|
2,600 |
|
|
Fixed maturities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government obligations and agencies |
|
116,903 |
|
|
|
116,083 |
|
|
|
116,083 |
|
|
|
105,229 |
|
|
|
104,215 |
|
|
|
104,215 |
|
|
Corporate bonds |
|
109,946 |
|
|
|
109,837 |
|
|
|
109,837 |
|
|
|
94,708 |
|
|
|
94,203 |
|
|
|
94,203 |
|
|
Mortgage-backed and asset-backed securities |
|
95,599 |
|
|
|
95,238 |
|
|
|
95,238 |
|
|
|
91,502 |
|
|
|
91,000 |
|
|
|
91,000 |
|
|
Redeemable preferred stock |
|
6,813 |
|
|
|
6,852 |
|
|
|
6,852 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Equity securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
331 |
|
|
|
250 |
|
|
|
250 |
|
|
|
8,500 |
|
|
|
9,295 |
|
|
|
9,295 |
|
|
Mutual funds |
|
21,297 |
|
|
|
20,137 |
|
|
|
20,137 |
|
|
|
55,113 |
|
|
|
55,727 |
|
|
|
55,727 |
|
|
Short-term investments |
|
37,500 |
|
|
|
37,473 |
|
|
|
37,473 |
|
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Total investments |
|
388,389 |
|
|
|
385,870 |
|
|
|
385,870 |
|
|
|
355,052 |
|
|
|
354,440 |
|
|
|
354,440 |
|
|
Total |
$ |
565,338 |
|
|
$ |
562,819 |
|
|
$ |
562,819 |
|
|
$ |
474,927 |
|
|
$ |
474,315 |
|
|
$ |
474,315 |
|
|
(1) |
Cash and cash equivalents have original maturities of three months or less. They include certificates of deposit, short-term debt securities consisting of direct obligations of the U.S. Treasury and/or money-market accounts that invest in or are collateralized by direct obligations of the U.S. Treasury and other U.S. government guaranteed securities. | |
| Investment Income (Expense) Comprised Primarily of Interest and Dividends |
The following table presents the components of net investment income, comprised primarily of interest and dividends, for the periods presented (in thousands):
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
|
Cash and cash equivalents (1) |
$ |
26 |
|
|
$ |
135 |
|
|
$ |
47 |
|
|
$ |
377 |
|
|
Fixed maturities |
|
884 |
|
|
|
439 |
|
|
|
2,394 |
|
|
|
409 |
|
|
Equity securities |
|
182 |
|
|
|
363 |
|
|
|
636 |
|
|
|
729 |
|
|
Short-term investments |
|
11 |
|
|
|
— |
|
|
|
11 |
|
|
|
— |
|
|
Total investment income |
|
1,103 |
|
|
|
937 |
|
|
|
3,088 |
|
|
|
1,515 |
|
|
Less: Investment expenses |
|
(459 |
) |
|
|
(555 |
) |
|
|
(1,514 |
) |
|
|
(985 |
) |
|
Net investment (expense) income |
$ |
644 |
|
|
$ |
382 |
|
|
$ |
1,574 |
|
|
$ |
530 |
|
|
(1) |
Includes interest earned on restricted cash and cash equivalents. | |
| Cost or Amortized Cost and Fair Value of Securities Available for Sale |
The following table provides the cost or amortized cost and fair value of securities available for sale as of the dates presented (in thousands):
|
|
September 30, 2014 |
|
|
|
Cost or |
|
|
Gross |
|
|
Gross |
|
|
|
|
|
|
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
|
|
|
|
|
Cost |
|
|
Gains |
|
|
Losses |
|
|
Fair Value |
|
|
Fixed Maturities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government obligations and agencies |
$ |
116,903 |
|
|
$ |
64 |
|
|
$ |
(884 |
) |
|
$ |
116,083 |
|
|
Corporate bonds |
|
109,946 |
|
|
|
216 |
|
|
|
(325 |
) |
|
|
109,837 |
|
|
Mortgage-backed and asset-backed securities |
|
95,599 |
|
|
|
141 |
|
|
|
(502 |
) |
|
|
95,238 |
|
|
Redeemable preferred stock |
|
6,813 |
|
|
|
71 |
|
|
|
(32 |
) |
|
|
6,852 |
|
|
Equity Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
331 |
|
|
|
1 |
|
|
|
(82 |
) |
|
|
250 |
|
|
Mutual funds |
|
21,297 |
|
|
|
— |
|
|
|
(1,160 |
) |
|
|
20,137 |
|
|
Short-term investments |
|
37,500 |
|
|
|
— |
|
|
|
(27 |
) |
|
|
37,473 |
|
|
Total |
$ |
388,389 |
|
|
$ |
493 |
|
|
$ |
(3,012 |
) |
|
$ |
385,870 |
|
|
|
December 31, 2013 |
|
|
|
Cost or |
|
|
Gross |
|
|
Gross |
|
|
|
|
|
|
|
Amortized |
|
|
Unrealized |
|
|
Unrealized |
|
|
|
|
|
|
|
Cost |
|
|
Gains |
|
|
Losses |
|
|
Fair Value |
|
|
Fixed Maturities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government obligations and agencies |
$ |
105,229 |
|
|
$ |
19 |
|
|
$ |
(1,033 |
) |
|
$ |
104,215 |
|
|
Corporate bonds |
|
94,708 |
|
|
|
265 |
|
|
|
(770 |
) |
|
|
94,203 |
|
|
Mortgage-backed and asset-backed securities |
|
91,502 |
|
|
|
75 |
|
|
|
(577 |
) |
|
|
91,000 |
|
|
Equity Securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
8,500 |
|
|
|
916 |
|
|
|
(121 |
) |
|
|
9,295 |
|
|
Mutual funds |
|
55,113 |
|
|
|
2,266 |
|
|
|
(1,652 |
) |
|
|
55,727 |
|
|
Total |
$ |
355,052 |
|
|
$ |
3,541 |
|
|
$ |
(4,153 |
) |
|
$ |
354,440 |
|
|
| Schedule of Credit Quality of Investments With Contractual Maturities |
The following table provides the credit quality of investments with contractual maturities as of the dates presented (in thousands):
|
September 30, 2014 |
|
|
Standard and Poor's |
|
|
|
|
|
% of Total |
|
|
Rating Services |
|
Fair Value |
|
|
Fair Value |
|
|
AAA |
|
$ |
28,505 |
|
|
|
8.1 |
% |
|
AA |
|
|
192,903 |
|
|
|
54.7 |
% |
|
A |
|
|
76,030 |
|
|
|
21.5 |
% |
|
BBB |
|
|
42,091 |
|
|
|
11.9 |
% |
|
BB and Below (1) |
|
|
2,714 |
|
|
|
0.8 |
% |
|
No Rating Available (2) |
|
|
10,740 |
|
|
|
3.0 |
% |
|
Total |
|
$ |
352,983 |
|
|
|
100.0 |
% |
|
December 31, 2013 |
|
|
Standard and Poor's |
|
|
|
|
|
% of Total |
|
|
Rating Services |
|
Fair Value |
|
|
Fair Value |
|
|
AAA |
|
$ |
82,889 |
|
|
|
28.6 |
% |
|
AA |
|
|
120,976 |
|
|
|
41.8 |
% |
|
A |
|
|
46,689 |
|
|
|
16.1 |
% |
|
BBB |
|
|
38,114 |
|
|
|
13.2 |
% |
|
No Rating Available |
|
|
750 |
|
|
|
0.3 |
% |
|
Total |
|
$ |
289,418 |
|
|
|
100.0 |
% |
|
(1) |
As of September 30, 2014, $259 thousand of these investments where rated “Baa3” by Moody’s Investors Service, Inc. |
|
(2) |
As of September 30, 2014, $7.5 million of these investments where rated “Aaa” by Moody’s Investors Service, Inc. | |
| Schedule of Amortized Cost and Fair Value on Mortgage-Backed and Asset-Backed Securities |
The following table summarizes the cost or amortized cost and fair value of mortgage-backed and asset-backed securities as of the dates presented (in thousands):
|
|
September 30, 2014 |
|
|
December 31, 2013 |
|
|
|
Cost or |
|
|
|
|
|
|
Cost or |
|
|
|
|
|
|
|
Amortized |
|
|
|
|
|
|
Amortized |
|
|
|
|
|
|
|
Cost |
|
|
Fair Value |
|
|
Cost |
|
|
Fair Value |
|
|
Mortgage-backed securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Agency |
$ |
59,548 |
|
|
$ |
59,228 |
|
|
$ |
64,028 |
|
|
$ |
63,547 |
|
|
Non-agency |
|
3,110 |
|
|
|
3,063 |
|
|
|
— |
|
|
|
— |
|
|
Asset-backed securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Auto loan receivables |
|
14,862 |
|
|
|
14,884 |
|
|
|
14,816 |
|
|
|
14,841 |
|
|
Credit card receivables |
|
13,479 |
|
|
|
13,464 |
|
|
|
11,478 |
|
|
|
11,425 |
|
|
Other receivables |
|
4,600 |
|
|
|
4,599 |
|
|
|
1,180 |
|
|
|
1,187 |
|
|
Total |
$ |
95,599 |
|
|
$ |
95,238 |
|
|
$ |
91,502 |
|
|
$ |
91,000 |
|
|
| Summarized Fair Value and Gross Unrealized Losses on Securities Available for Sale |
The following table summarizes the fair value and gross unrealized losses on securities available for sale, aggregated by major investment category and length of time that individual securities have been in a continuous unrealized loss position as of the dates presented (in thousands):
|
|
September 30, 2014 |
|
|
|
Less Than 12 Months |
|
|
12 Months or Longer |
|
|
|
Number of |
|
|
|
|
|
|
Unrealized |
|
|
Number of |
|
|
|
|
|
|
Unrealized |
|
|
|
Issues |
|
|
Fair Value |
|
|
Losses |
|
|
Issues |
|
|
Fair Value |
|
|
Losses |
|
|
Fixed maturities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government obligations and agencies |
|
2 |
|
|
$ |
17,473 |
|
|
$ |
(152 |
) |
|
|
4 |
|
|
$ |
33,950 |
|
|
$ |
(732 |
) |
|
Corporate bonds |
|
42 |
|
|
|
35,635 |
|
|
|
(153 |
) |
|
|
13 |
|
|
|
16,301 |
|
|
|
(172 |
) |
|
Mortgage-backed and asset-backed securities |
|
14 |
|
|
|
35,116 |
|
|
|
(221 |
) |
|
|
7 |
|
|
|
24,775 |
|
|
|
(281 |
) |
|
Redeemable preferred stock |
|
26 |
|
|
|
2,681 |
|
|
|
(32 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Equity securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
3 |
|
|
|
131 |
|
|
|
(27 |
) |
|
|
2 |
|
|
|
107 |
|
|
|
(55 |
) |
|
Mutual funds |
|
2 |
|
|
|
10,487 |
|
|
|
(70 |
) |
|
|
1 |
|
|
|
9,596 |
|
|
|
(1,090 |
) |
|
Short-term investments |
|
1 |
|
|
|
24,973 |
|
|
|
(27 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Total |
|
90 |
|
|
$ |
126,496 |
|
|
$ |
(682 |
) |
|
|
27 |
|
|
$ |
84,729 |
|
|
$ |
(2,330 |
) |
|
|
December 31, 2013 |
|
|
|
Less Than 12 Months |
|
|
12 Months or Longer |
|
|
|
Number of |
|
|
|
|
|
|
Unrealized |
|
|
Number of |
|
|
|
|
|
|
Unrealized |
|
|
|
Issues |
|
|
Fair Value |
|
|
Losses |
|
|
Issues |
|
|
Fair Value |
|
|
Losses |
|
|
Fixed maturities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. government obligations and agencies |
|
6 |
|
|
$ |
71,042 |
|
|
$ |
(1,033 |
) |
|
|
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
Corporate bonds |
|
55 |
|
|
|
65,926 |
|
|
|
(770 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Mortgage-backed and asset-backed securities |
|
16 |
|
|
|
67,110 |
|
|
|
(577 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Equity securities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common stock |
|
13 |
|
|
|
3,517 |
|
|
|
(121 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Mutual funds |
|
5 |
|
|
|
19,646 |
|
|
|
(1,652 |
) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
Total |
|
95 |
|
|
$ |
227,241 |
|
|
$ |
(4,153 |
) |
|
|
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
| Amortized Cost and Fair Value of Investments With Contractual Maturities |
The following table presents the amortized cost and fair value of investments with contractual maturities as of the date presented (in thousands):
|
|
September 30, 2014 |
|
|
|
Cost or |
|
|
|
|
|
|
|
Amortized Cost |
|
|
Fair Value |
|
|
Due in one year or less |
$ |
79,061 |
|
|
$ |
78,943 |
|
|
Due after one year through five years |
|
171,757 |
|
|
|
170,939 |
|
|
Due after five years through ten years |
|
138 |
|
|
|
128 |
|
|
Due after ten years |
|
3,652 |
|
|
|
3,676 |
|
|
Mortgage-backed and asset-backed securities |
|
95,599 |
|
|
|
95,238 |
|
|
Perpetual maturity securities |
|
4,054 |
|
|
|
4,059 |
|
|
Total |
$ |
354,261 |
|
|
$ |
352,983 |
|
|
| Summary of Securities Available for Sale |
The following table provides certain information related to securities available for sale during the period presented (in thousands):
|
|
Three Months Ended |
|
|
Nine Months Ended |
|
|
|
September 30, |
|
|
September 30, |
|
|
|
2014 |
|
|
2013 |
|
|
2014 |
|
|
2013 |
|
|
Sales proceeds (fair value) |
$ |
53,961 |
|
|
$ |
376 |
|
|
$ |
126,748 |
|
|
$ |
390 |
|
|
Gross realized gains |
$ |
742 |
|
|
$ |
56 |
|
|
$ |
5,930 |
|
|
$ |
56 |
|
|
Gross realized losses |
$ |
(241 |
) |
|
$ |
— |
|
|
$ |
(577 |
) |
|
$ |
(1 |
) |
|
Other than temporary losses |
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
$ |
— |
|
|
| Effect of Trading Activities by Type of Instrument and by Line Item in Condensed Consolidated Statements of Income |
The following table provides the effect of trading activities on the Company’s results of operations for the period presented by type of instrument and by line item in the Condensed Consolidated Statements of Income (in thousands):
|
|
Nine Months Ended |
|
|
|
September 30, 2013 |
|
|
Realized gains (losses) on investments: |
|
|
|
|
Equity securities |
$ |
(15,969 |
) |
|
Derivatives (non-hedging instruments) (1) |
|
(68 |
) |
|
Total realized gains (losses) on trading portfolio |
|
(16,037 |
) |
|
Change in unrealized gains (losses) on investments: |
|
|
|
|
Fixed maturities |
|
13 |
|
|
Equity securities |
|
7,758 |
|
|
Derivatives (non-hedging instruments) (1) |
|
89 |
|
|
Other |
|
14 |
|
|
Total change in unrealized gains (losses) on trading portfolio |
|
7,874 |
|
|
Net gains (losses) recognized on trading portfolio |
$ |
(8,163 |
) |
|
(1) |
This table provides the alternative quantitative disclosures permitted for derivatives that are not used as hedging instruments and are included in the trading portfolio. | |