Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Components of deferred tax assets and liabilities

Significant components of ProAssurance’s deferred tax assets and liabilities were as follows:



	Year Ended December 31
(In thousands)	2016		2015
Deferred tax assets
Unpaid loss discount	$	39,746	$	44,886
Unearned premium adjustment	22,847		22,889
Compensation related	20,190		18,130
Intangibles	1,001		1,435
Total deferred tax assets	83,784		87,340
Deferred tax liabilities
Deferred acquisition costs	9,754		9,287
Unrealized gains on investments, net	9,797		13,933
Fixed assets	1,291		3,401
Basis differentials–investments	25,512		17,492
Intangibles	22,067		24,644
Other	5,107		3,486
Total deferred tax liabilities	73,528		72,243
Net deferred tax assets (liabilities)	$	10,256	$	15,097

Reconciliation of unrecognized tax benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits for 2016, 2015 and 2014, were as follows:



(In thousands)	2016			2015		2014
Balance at January 1	$	8,195		$	577	$	4,823
Increase for tax position acquired as result of a business combination	—			—		414
Increases for tax positions taken during the current year	361			7,618		163
(Decreases) for tax positions taken during the current year	—			—		(4,823		)
(Decreases) relating to a lapse of the applicable statute of limitations	(203		)	—		—
Balance at December 31	$	8,353		$	8,195	$	577

Reconciliation of expected income tax expense to actual income tax expense

A reconciliation of “expected” income tax expense (35% of income before income taxes) to actual income tax expense for each of the years ended December 31, 2016, 2015 and 2014 were as follows:



(In thousands)	2016			2015			2014
Computed “expected” tax expense	$	61,670		$	45,099		$	91,702
Tax-exempt income	(9,917		)	(12,913		)	(13,250		)
Tax credits	(27,549		)	(22,407		)	(17,918		)
Non-U.S. Loss	—			1,806			1,741
Other	916			1,073			3,165
Income tax expense	$	25,120		$	12,658		$	65,440