Benefit Plans

6 Months Ended

Jun. 30, 2021

Retirement Benefits [Abstract]

Benefit Plans

Benefit PlansProAssurance assumed a defined benefit pension plan on May 5, 2021 as a result of its acquisition of NORCAL (see Note 2 for additional information), which covers substantially all NORCAL employees (except those that were previous employees of Medicus Insurance Company and FD Insurance Company), employees of PPM RRG as well as new hires after December 31, 2013. Benefits are based on years of service and the employee’s average of the highest five years of annual compensation. Annual contributions to the defined benefit pension plan are not less than the minimum funding standards outlined in the Employee Retirement Income Security Act of 1974, as amended. ProAssurance makes contributions to the defined benefit pension plan with the goal of ensuring that it is adequately funded to meet its future obligations. ProAssurance did not make any contributions to the pension plan during the period from May 5, 2021 to June 30, 2021 and does not anticipate making any contributions for the remainder of 2021. The defined benefit pension plan no longer has future service accruals or compensation increases because this plan was frozen effective December 31, 2015.

The weighted average discount rate used to determine the projected benefit obligation of the defined benefit pension plan as of the date of the NORCAL acquisition on May 5, 2021 was 2.95%. The weighted average discount rate and the weighted average expected return on plan assets used to determine net periodic benefit cost (credit) for the period from May 5, 2021 to December 31, 2021 was 2.95% and 3.75%, respectively.

The components of the net periodic benefit cost (credit) for the three and six months ended June 30, 2021 were equal and are as follows:

($ in thousands)	Three and Six Months Ended June 30, 2021
Components of net periodic (benefit) cost:
Interest cost	$	474
Expected return on Plan assets	(642)
Total net periodic (benefit) cost*	$	(168)
*Net periodic (benefit) cost is included as a component of operating expense on the Condensed Consolidated Statements of Income and Comprehensive Income for the three and six months ended June 30, 2021, respectively.