Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of Company's Deferred Income Tax Assets and Liabilities

The Company’s deferred income tax assets and liabilities are as follows:

	December 31,
	2016			2015
	(in thousands)
Deferred income tax assets:
Discounting of net unpaid loss and loss adjustment expenses	$	16,035		$	15,415
Unearned premiums		14,483			14,839
Accrued expenses and other		3,640			3,904
State income tax		617			488
Accrued policyholder dividends		2,024			719
Impaired securities		70			238
Capital loss carryforward		15			715
Accrued insurance-related assessments		5,323			4,953
Net unrealized loss on securities		265			—
Total deferred tax assets		42,472			41,271
Deferred income tax liabilities:
Deferred policy acquisition costs		(8,492	)		(9,012	)
Callable bond amortization		(10	)		—
Unrealized gain on securities available-for-sale		—			(1,393	)
Property and equipment and other		204			(696	)
Salvage and subrogation		(363	)		(265	)
Guaranty fund related items		—			—
Total deferred income tax liabilities		(8,661	)		(11,366	)
Net deferred income taxes	$	33,811		$	29,905

Components of Consolidated Income Tax Expense (Benefit)

The components of consolidated income tax expense (benefit) are as follows:

	Year Ended December 31,
	2016			2015		2014
	(in thousands)
Current:
Federal	$	35,602		$	28,047	$	20,811
State		1,603			1,012		684
		37,205			29,059		21,495
Deferred:
Federal		(2,120	)		1,343		(821	)
State		(129	)		103		(591	)
		(2,249	)		1,446		(1,412	)
Total	$	34,956		$	30,505	$	20,083

Income Tax Expense from Operations from the Amount Computed by Applying the U.S. Federal Income Tax Statutory Rate of 35% to Income Before Income Taxes

Income tax expense from operations is different from the amount computed by applying the U.S. federal income tax statutory rate of 35% to income before income taxes as follows:

	Year Ended December 31,
	2016			2015			2014
	(in thousands)
Income tax computed at federal statutory tax rate	$	39,487		$	35,338		$	25,812
Tax-exempt interest, net		(5,370	)		(5,630	)		(5,620	)
State income tax		913			762			(146	)
Dividends received deduction		(125	)		(19	)		(60	)
Other		51			54			97
	$	34,956		$	30,505		$	20,083