Income Taxes (Tables)

12 Months Ended

Dec. 31, 2020

Income Taxes [Abstract]

Significant Components of Deferred Tax Assets and Liabilities

Deferred income taxes are calculated to account for the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.  Significant components of the Company's deferred tax assets and liabilities as of December 31, 2020 and 2019 are as follows:

	2020		2019
Deferred tax liabilities:
Unrealized gain on fixed income and equity security investments	$	8,159	$	5,327
Deferred acquisition costs		2,538		2,821
Loss and loss expense reserves		2,222		2,701
Limited partnership investments		–		2,587
Accelerated depreciation		669		687
Other		1,495		1,361
Total deferred tax liabilities		15,083		15,484
Deferred tax assets:
Loss and loss expense reserves		12,923		11,460
Limited partnership investments		822		–
Unearned premiums discount		2,339		2,529
Impairment related investment declines		435		39
Deferred compensation		1,999		1,181
Deferred ceding commission		492		1,037
Allowance for credit losses		3,580		–
Other		1,473		1,273
Total deferred tax assets		24,063		17,519
Net deferred tax assets	$	8,980	$	2,035

Difference between Federal Income Taxes Expense (Benefit) Computed at Statutory Rate

A summary of the difference between federal income tax expense (benefit) computed at the statutory rate and that reported in the consolidated financial statements as of December 31, 2020, 2019 and 2018 is as follows:

	2020			2019			2018
Statutory federal income rate applied to pre-tax income (loss)	$	1,336		$	1,821		$	(9,213	)
Tax effect of (deduction):
Tax-exempt investment income		(239	)		(402	)		(253	)
Valuation allowance		1,264			–			–
Other		(461	)		(93	)		(331	)
Federal income tax expense (benefit)	$	1,900		$	1,326		$	(9,797	)

Federal Income Tax Expense (Benefit)

Federal income tax expense (benefit) as of December 31, 2020, 2019 and 2018 consists of the following:

	2020			2019			2018
Tax expense (benefit) on pre-tax income (loss):
Current	$	7,144		$	1,377		$	8,997
Deferred		(5,244	)		(51	)		(18,794	)
	$	1,900		$	1,326		$	(9,797	)

Provision for Deferred Federal Income Tax

The provision for deferred federal income taxes as of December 31, 2020, 2019 and 2018 consists of the following:

	2020			2019			2018
Limited partnerships	$	(3,409	)	$	1,143		$	(2,383	)
Discounts of loss and loss expense reserves		(1,944	)		(2,269	)		(2,704	)
Reserves - salvage and subrogation and other		1			(74	)		427
Unearned premium discount		190			(208	)		(484	)
Deferred compensation		(818	)		(600	)		305
Impairment related investment declines		(1,400	)		(411	)		695
Deferred acquisitions costs and ceding commission		262			405			201
Unrealized gains / losses		(59	)		1,837			(13,876	)
Valuation allowance		1,264			–			–
Other		669			126			(975	)
Provision for deferred federal income taxes	$	(5,244	)	$	(51	)	$	(18,794	)