Retirement and Other Employee Benefits

Defined Benefit Plans

The Company and its subsidiaries participate in a non-contributory, qualified defined benefit pension plan (“Assurant Pension Plan”) covering substantially all employees. The Assurant Pension Plan is considered “qualified” because it meets the requirements of Internal Revenue Code Section 401(a) (“IRC 401(a)”) and the Employee Retirement Income Security Act of 1974 (“ERISA”). The Assurant Pension Plan is a pension equity plan with a grandfathered final average earnings plan for a certain group of employees. Benefits are based on certain years of service and the employee’s compensation during certain such years of service. The Company’s funding policy is to contribute amounts to the Assurant Pension Plan sufficient to meet the minimum funding requirements in ERISA, plus such additional amounts as the Company may determine to be appropriate from time to time up to the maximum permitted. The funding policy considers several factors to determine such additional amounts, including items such as the amount of service cost plus 15% of the Assurant Pension Plan deficit and the capital position of the Company. During 2015, we contributed $10,750 in cash to the Assurant Pension Plan. Due to the Plan's current funding status, no cash is expected to be contributed to the Assurant Pension Plan over the course of 2016. Contributions are intended to provide not only for benefits attributed to service to date, but also for those expected to be earned in the future. Assurant Pension Plan assets are maintained in a separate trust and as such are not included in the consolidated balance sheets of the Company. Plan assets and benefit obligations are measured as of December 31, 2015.

The Company also has various non-contributory, non-qualified supplemental plans covering certain employees. Since these plans are “non-qualified” they are not subject to the laws and regulations of IRC 401(a) and ERISA. As such, the Company is not required, and does not, fund these plans. The qualified and nonqualified plans are referred to as “Pension Benefits” unless otherwise noted. The Company has the right to modify or terminate these benefits; however, the Company will not be relieved of its obligation to plan participants for their vested benefits.

As of January 1, 2014, the Assurant Pension Plan and Executive Pension Plans are no longer offered to new hires. Subsequently, effective January 1, 2016, the Assurant Pension Plan was amended and split into two separate plans (Plan No. 1 and Plan No. 2). The new Plan No. 2 will include a subset of the terminated vested population and the total in-payment population as of January 1, 2016. Assets for both plans will remain in the Assurant, Inc. Pension Plan Trust, however separate accounting entities will be maintained for Plan No. 1 and Plan No. 2.

Effective March 1, 2016, the Assurant Pension Plan and various non-qualified pension plans (including an Executive Pension Plan) were frozen. No additional benefits will be earned after February 29, 2016.

In addition, the Company provides certain life and health care benefits (“Retirement Health Benefits”) for retired employees and their dependents. On July 1, 2011, the Company terminated certain health care benefits for employees who did not qualify for “grandfathered” status and no longer offers these benefits to new hires. The Company contribution, plan design and other terms of the remaining benefits will not change for those grandfathered employees. The Company has the right to modify or terminate these benefits.

Summarized information on the Company’s Pension Benefits and Retirement Health Benefits plans (together the “Plans”) for the years ended December 31 is as follows:



	Pension Benefits									Retirement Health Benefits
	2015			2014			2013			2015			2014			2013
Change in projected benefit obligation
Projected benefit obligation at beginning of year	$	(1,064,042	)	$	(905,943	)	$	(956,172	)	$	(96,306	)	$	(79,046	)	$	(86,237	)
Service cost	(41,989		)	(36,609		)	(38,580		)	(2,429		)	(2,188		)	(2,863		)
Interest cost	(41,766		)	(43,613		)	(38,243		)	(3,834		)	(3,868		)	(3,473		)
Actuarial (loss) gain, including curtailments and settlements	52,201			(127,940		)	89,029			5,938			(13,910		)	11,213
Benefits paid	77,002			50,063			38,023			3,121			2,706			2,314
Projected benefit obligation at end of year	$	(1,018,594	)	$	(1,064,042	)	$	(905,943	)	$	(93,510	)	$	(96,306	)	$	(79,046	)
Change in plan assets
Fair value of plan assets at beginning of year	$	879,211		$	786,750		$	704,976		$	50,068		$	46,971		$	45,651
Actual return on plan assets	(5,458		)	102,628			64,641			(291		)	5,403			3,234
Employer contributions	37,664			41,384			56,217			200			400			400
Benefits paid (including administrative expenses)	(78,731		)	(51,551		)	(39,084		)	(3,121		)	(2,706		)	(2,314		)
Fair value of plan assets at end of year	$	832,686		$	879,211		$	786,750		$	46,856		$	50,068		$	46,971
Funded status at end of year	$	(185,908	)	$	(184,831	)	$	(119,193	)	$	(46,654	)	$	(46,238	)	$	(32,075	)

In accordance with the guidance on retirement benefits, the Company aggregates the results of the qualified and non-qualified plans as “Pension Benefits” and is required to disclose the aggregate projected benefit obligation, accumulated benefit obligation and fair value of plan assets, if the obligations within those plans exceed plan assets.

For the years ended December 31, 2015, 2014 and 2013, the projected benefit obligations, the accumulated benefit obligations of Pension Benefits, and fair value of plan assets are as follows:



	Qualified Pension Benefits									Non-Qualified Pension Benefits									Total Pension Benefits
	2015			2014			2013			2015			2014			2013			2015			2014			2013
Fair value of plan assets	$	832,686		$	879,211		$	786,750		$	—		$	—		$	—		$	832,686		$	879,211		$	786,750
Projected benefit obligation	(884,659		)	(908,167		)	(768,672		)	(133,935		)	(155,875		)	(137,271		)	(1,018,594		)	(1,064,042		)	(905,943		)
Funded status at end of year	$	(51,973	)	$	(28,956	)	$	18,078		$	(133,935	)	$	(155,875	)	$	(137,271	)	$	(185,908	)	$	(184,831	)	$	(119,193	)
Accumulated benefit obligation	$	764,654		$	761,802		$	645,431		$	113,712		$	133,185		$	115,286		$	878,366		$	894,987		$	760,717

The Pension Protection Act of 2006 (“PPA”) requires certain qualified plans, like the Assurant Pension Plan, to meet specified funding thresholds. If these funding thresholds are not met, there are negative consequences to the plan and participants. If the funded percentage falls below 80%, full payment of lump sum benefits as well as implementation of amendments improving benefits are restricted.

As of January 1, 2015, the Assurant Pension Plan funded percentage was 136% on a PPA calculated basis (based on an actuarial average value of assets compared to the funding target). Therefore, benefit and payment restrictions did not occur during 2015. The 2015 funded measure will also be used to determine restrictions, if any, that can occur during the first nine months of 2016. Due to the funding status of the Assurant Pension Plan in 2015, no restrictions will exist before October 2016 (the time that the January 1, 2016 actuarial valuation needs to be completed). Also, based on the estimated funded status as of January 1, 2016, the Company does not anticipate any restrictions on benefits for the remainder of 2016.

Amounts recognized in the consolidated balance sheets consist of:



	Pension Benefits									Retirement Health Benefits
	2015			2014			2013			2015			2014			2013
Assets	$	—		$	—		$	18,078		$	—		$	—		$	—
Liabilities	$	(185,908	)	$	(184,831	)	$	(137,271	)	$	(46,654	)	$	(46,238	)	$	(32,075	)

Amounts recognized in accumulated other comprehensive income consist of:



	Pension Benefits									Retirement Health Benefits
	2015			2014			2013			2015		2014			2013
Net (loss) gain	$	(201,578	)	$	(210,859	)	$	(147,288	)	$	1,987	$	(394	)	$	11,710
Prior service (cost) credit	(2,339		)	(3,272		)	(4,119		)	4,236		5,169			6,102
	$	(203,917	)	$	(214,131	)	$	(151,407	)	$	6,223	$	4,775		$	17,812

Components of net periodic benefit cost and other amounts recognized in accumulated other comprehensive income for the years ended December 31 were as follows:



	Pension Benefits									Retirement Health Benefits
	2015			2014			2013			2015			2014			2013
Net periodic benefit cost
Service cost	$	41,989		$	36,609		$	38,580		$	2,429		$	2,188		$	2,863
Interest cost	41,766			43,613			38,243			3,834			3,868			3,473
Expected return on plan assets	(53,868		)	(49,552		)	(44,222		)	(3,267		)	(3,081		)	(2,998		)
Amortization of prior service cost	787			836			856			(933		)	(933		)	(933		)
Amortization of net loss (gain)	16,660			11,921			26,816			—			(516		)	—
Curtailment/settlement charge	1,622			871			—			—			—			—
Net periodic benefit cost	$	48,956		$	44,298		$	60,273		$	2,063		$	1,526		$	2,405
Other changes in plan assets and benefit obligations recognized in accumulated other comprehensive income
Net loss (gain)	$	9,099		$	75,909		$	(108,387	)	$	(2,382	)	$	11,588		$	(11,449	)
Amortization of prior service cost, and effects of curtailments/settlements	(933		)	(847		)	(856		)	933			933			933
Amortization of net (loss) gain	(18,381		)	(12,338		)	(26,816		)	—			516			—
Total recognized in accumulated other comprehensive income	$	(10,215	)	$	62,724		$	(136,059	)	$	(1,449	)	$	13,037		$	(10,516	)
Total recognized in net periodic benefit cost and other comprehensive income loss	$	38,741		$	107,022		$	(75,786	)	$	614		$	14,563		$	(8,111	)

The Company uses a five-year averaging method to determine the market-related value of Pension Benefits plan assets, which is used to calculate the expected return of plan assets component of the Plans’ expense. Under this methodology, asset gains/losses that result from actual returns which differ from the Company’s expected long-term rate of return on assets assumption are recognized in the market-related value of assets on a level basis over a five year period. The difference between actual as compared to expected asset returns for the Plans will be fully reflected in the market-related value of plan assets over the next five years using the methodology described above. Other post-employment benefit assets under the Retirement Health Benefits are valued at fair value.

The estimated net loss and prior service cost of Pension Benefits that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $8,699 and $435, respectively. The prior service credit of Retirement Health Benefits that will be amortized from accumulated other comprehensive income into net periodic credit over the next fiscal year is $933. There was no estimated net gain (loss) of Retirement Health Benefits that will be amortized from accumulated other comprehensive income into net periodic cost over the next fiscal year.

Determination of the projected benefit obligation was based on the following weighted-average assumptions for the years ended December 31:



	Qualified Pension Benefits						Nonqualified Pension Benefits						Retirement Health Benefits
	2015		2014		2013		2015		2014		2013		2015		2014		2013
Discount rate	4.55	%	4.09	%	4.98	%	4.25	%	3.77	%	4.64	%	4.53	%	4.07	%	4.99	%

Determination of the net periodic benefit cost was based on the following weighted-average assumptions for the years ended December 31:



	Qualified Pension Benefits						Nonqualified Pension Benefits						Retirement Health Benefits
	2015		2014		2013		2015		2014		2013		2015		2014		2013
Discount rate	4.09	%	4.98	%	4.12	%	3.77	%	4.64	%	3.71	%	4.07	%	4.99	%	4.12	%
Expected long-term return on plan assets	6.75	%	6.75	%	6.75	%	—		—		—		6.75	%	6.75	%	6.75	%


*	Assumed rates of compensation increases are also used to determine net periodic benefit cost. Assumed rates varied by age and ranged from 3.25% to 9.30% for the Pension Benefits for the years ended December 31, 2015, 2014 and 2013.

The selection of our discount rate assumption reflects the rate at which the Plans’ obligations could be effectively settled at December 31, 2015, 2014 and 2013. The methodology for selecting the discount rate was to match each Plan’s cash flows to that of a yield curve that provides the equivalent yields on zero-coupon corporate bonds for each maturity. The yield curve utilized in the cash flow analysis was comprised of 281 bonds rated AA by either Moody’s or Standard & Poor’s with maturities between zero and thirty years. The discount rate for each Plan is the single rate that produces the same present value of cash flows. As of December 31, 2015, we have chosen to implement a split rate approach for purposes of determining the benefit obligations and service cost as well as a spot rate approach for the calculation of interest on these items in the determination of the net periodic benefit cost. This change is a refinement in the methodology used to determine these amounts in the accounting for defined benefit retirement plans under U.S. GAAP. Due to the new spot rate approach, the rates shown above as of December 31, 2015 are the single equivalent rates for the projected benefit obligations based on the December 31, 2015 yield curve spot rates.

To develop the expected long-term rate of return on assets assumption, the Company considered the current level of expected returns on risk free investments (primarily government bonds), the historical level of the risk premium associated with the other asset classes in which the portfolio is invested and the expectations for future returns of each asset class. The expected long-term rate of return on plan assets reflects the average rate of earnings expected on the funds invested or to be invested. The expected return for each asset class was then weighted based on the targeted asset allocation to develop the expected long-term rate of return on asset assumptions for the portfolio. The Company believes the current assumption reflects the projected return on the invested assets, given the current market conditions and the modified portfolio structure. Actual return on plan assets was (0.6)% and 13.0% for the years ended December 31, 2015 and 2014, respectively.

The assumed health care cost trend rates used in measuring the accumulated postretirement benefit obligation and net periodic benefit cost were as follows:



	Retirement Health Benefits
	2015		2014		2013
Health care cost trend rate assumed for next year:
Pre-65 Non-reimbursement Plan	9.3	%	8.1	%	8.7	%
Post-65 Non-reimbursement Plan (Medical)	5.7	%	8.0	%	8.5	%
Post-65 Non-reimbursement Plan (Rx)	10.2	%	8.0	%	8.5	%
Pre-65 Reimbursement Plan	8.1	%	8.1	%	8.7	%
Post-65 Reimbursement Plan	8.1	%	8.1	%	8.7	%
Rate to which the cost trend rate is assumed to decline (the ultimate trend rate)	4.5	%	4.5	%	4.5	%
Year that the rate reaches the ultimate trend rate
Pre-65 Non-reimbursement Plan	2030		2028		2028
Post-65 Non-reimbursement Plan (Medical & Rx)	2030		2028		2028
Pre-65 Reimbursement Plan	2030		2028		2028
Post-65 Reimbursement Plan	2030		2028		2028

Assumed health care cost trend rates have a significant effect on the amounts reported for the health care plans. A one-percentage point change in assumed health care cost trend rates would have the following effects:



	Retirement Health Benefits
	2015			2014			2013
One percentage point increase in health care cost trend rate
Effect on total of service and interest cost components	$	38		$	39		$	43
Effect on postretirement benefit obligation	622			646			601
One percentage point decrease in health care cost trend rate
Effect on total of service and interest cost components	$	(59	)	$	(60	)	$	(66	)
Effect on postretirement benefit obligation	(908		)	(933		)	(884		)

The assets of the Plans are managed to maximize their long-term pre-tax investment return, subject to the following dual constraints: minimization of required contributions and maintenance of solvency requirements. It is anticipated that periodic contributions to the Plans will, for the foreseeable future, be sufficient to meet benefit payments thus allowing the balance to be managed according to a long-term approach. The Investment Committee for the Plans meets on a quarterly basis and reviews the re-balancing of existing fund assets and the asset allocation of new fund contributions.

The goal of our asset strategy is to ensure that the growth in the value of the fund over the long-term, both in real and nominal terms, manages (controls) risk exposure. Risk is managed by investing in a broad range of asset classes, and within those asset classes, a broad range of individual securities. Diversification by asset classes stabilizes total fund results over short-term time periods. Each asset class is externally managed by outside investment managers appointed by the Investment Committee. Derivatives may be used consistent with the Plan’s investment objectives established by the Investment Committee. All securities must be U.S. dollar denominated.

In 2015, 7% of the Plans’ assets were allocated to Meisirow Institutional Multi-Strategy Fund, L.P. (“MIMSF”). MIMSF is a multi-strategy product for U.S. tax-exempt investors subject to ERISA. MIMSF allocates to five primary sub-strategies including hedged equity, credit, event, relative value and multi-strategy. Allocations to these sub-strategies will shift over time depending upon MIMSF’s investment outlook. MIMSF is managed to be broadly diversified in terms of both strategy and manager exposures.

The Investment Committee that oversees the investment of the plan assets conducts an annual review of the investment strategies and policies of the Plans. This includes a review of the strategic asset allocation, including the relationship of the Plans’ liabilities and portfolio structure. As a result of this review, the Investment Committee adopted the current target asset allocation. The allocation is consistent with 2014.



	The Plans’ Asset Allocation Percentages
Financial Assets (1)	Low		Target (2)		High
Equity securities:
Common stock- U.S. listed small cap	5.0	%	7.5	%	10.0	%
Mutual fund- U.S. listed large cap	10.0	%	15.0	%	20.0	%
Common/collective trust- foreign listed	5.0	%	7.5	%	10.0	%
Fixed maturity securities:
U.S. & foreign government and government agencies and authorities	6.5	%	9.0	%	11.5	%
Corporate- U.S. & foreign investment grade	31.0	%	33.5	%	36.0	%
Corporate- U.S. & foreign high yield	5.0	%	7.5	%	10.0	%
Alternative investment fund:
Multi-strategy hedge fund	5.5	%	8.0	%	10.5	%
Commingled real estate fund	3.5	%	6.0	%	8.5	%
Private equity fund	—	%	6.0	%	8.5	%

(1)

The Plans’ long-term asset allocation targets are 30% equity, 50% fixed income and 20% investment funds. The Company invests certain plan assets in investment funds, examples of which include real estate investment funds and private equity funds. Amounts allocated for these investments are included in the alternative investment funds caption of the asset allocation at December 31, 2015, provided in the section above.


(2)	It is understood that these guidelines are targets and that deviations may occur periodically as a result of cash flows, market impact or short-term decisions implemented by either the Investment Committee or their investment managers.

The assets of the Plans are primarily invested in fixed maturity and equity securities. While equity risk is fully retained, interest rate risk is hedged by aligning the duration of the fixed maturity securities with the duration of the liabilities. Specifically, interest rate swaps are used to synthetically extend the duration of fixed maturity securities to match the duration of the liabilities, as measured on a projected benefit obligation basis. In addition, the Plans’ fixed income securities have exposure to credit risk. In order to adequately diversify and limit exposure to credit risk, the Investment Committee established parameters which include a limit on the asset types that managers are permitted to purchase, maximum exposure limits by sector and by individual issuer (based on asset quality) and minimum required ratings on individual securities. As of December 31, 2015, 49% of plan assets were invested in fixed maturity securities and 15%, 12% and 9% of those securities were concentrated in the financial, communications and consumer non-cyclical industries, with no exposure to any single creditor in excess of 4%, 6% and 7% of those industries, respectively. As of December 31, 2015, 33% of plan assets were invested in equity securities and 52% of the Plans’ equity securities were invested in a mutual fund that attempts to replicate the return of the Standard & Poor’s 500 index (“S&P 500”) by investing its assets in large capitalization stocks that are included in the S&P 500 using a weighting similar to the S&P 500.

The fair value hierarchy for the Company’s qualified pension plan and other post retirement benefit plan assets at December 31, 2015 by asset category, is as follows:



Qualified Pension Benefits	December 31, 2015
Financial Assets	Total			Level 1		Level 2		Level 3
Cash and cash equivalents:
Short-term investment funds	$	30,628		$	—	$	30,628	$	—
Equity securities:
Common stock- U.S. listed small cap	66,948			66,948		—		—
Preferred stock	4,420			4,420		—		—
Mutual funds- U.S. listed large cap	141,580			141,580		—		—
Common/collective trust- foreign listed	57,948			—		57,948		—
Fixed maturity securities:
U.S. & foreign government and government agencies and authorities	126,531			—		126,531		—
Corporate- U.S. & foreign investment grade	221,766			—		221,766		—
Corporate- U.S. & foreign high yield	57,238			—		57,238		—
Investment fund:
Multi-strategy hedge fund	61,761			—		—		61,761
Commingled real estate fund	49,643			—		49,643		—
Private equity fund	6,210			—		—		6,210
Derivatives:
Interest rate swap	14,024			—		14,024		—
Total financial assets	$	838,697	₍₁₎	$	212,948	$	557,778	$	67,971


(1)	The difference between the fair value of plan assets above and the amount used in determining the funded status is due to interest receivable which is not required to be included in the fair value hierarchy.



Retirement Health Benefits	December 31, 2015
Financial Assets	Total			Level 1		Level 2		Level 3
Cash and cash equivalents:
Short-term investment funds	$	1,723		$	—	$	1,723	$	—
Equity securities:
Common stock- U.S. listed small cap	3,767			3,767		—		—
Preferred stock	249			249		—		—
Mutual funds- U.S. listed large cap	7,967			7,967		—		—
Common/collective trust- foreign listed	3,261			—		3,261		—
Fixed maturity securities:
U.S. & foreign government and government agencies and authorities	7,120			—		7,120		—
Corporate- U.S. & foreign investment grade	12,479			—		12,479		—
Corporate- U.S. & foreign high yield	3,221			—		3,221		—
Investment fund:
Multi-strategy hedge fund	3,475			—		—		3,475
Commingled real estate fund	2,794			—		2,794		—
Private equity fund	350			—		—		350
Derivatives:
Interest rate swap	789			—		789		—
Total financial assets	$	47,195	₍₁₎	$	11,983	$	31,387	$	3,825


(1)	The difference between the fair value of plan assets above and the amount used in determining the funded status is due to interest receivable which is not required to be included in the fair value hierarchy.

The fair value hierarchy for the Company’s qualified pension plan and other post retirement benefit plan assets at December 31, 2014 by asset category, is as follows:



Qualified Pension Benefits	December 31, 2014
Financial Assets	Total			Level 1		Level 2		Level 3
Cash and cash equivalents:
Short-term investment funds	$	41,165		$	—	$	41,165	$	—
Equity securities:
Common stock- U.S. listed small cap	63,761			63,761		—		—
Preferred stock	4,209			4,209		—		—
Mutual funds- U.S. listed large cap	191,240			191,240		—		—
Common/collective trust- foreign listed	59,249			—		59,249		—
Fixed maturity securities:
U.S. & foreign government and government agencies and authorities	121,694			—		121,694		—
Corporate- U.S. & foreign investment grade	226,078			—		226,078		—
Corporate- U.S. & foreign high yield	55,759			—		55,759		—
Investment fund:
Multi-strategy hedge fund	63,132			—		—		63,132
Commingled real estate fund	43,471			—		43,471		—
Private equity fund	4,614			—		—		4,614
Derivatives:
Interest rate swap	14,242			—		14,242		—
Total financial assets	$	888,614	₍₁₎	$	259,210	$	561,658	$	67,746


(1)	The difference between the fair value of plan assets above and the amount used in determining the funded status is due to interest receivable which is not required to be included in the fair value hierarchy.



Retirement Health Benefits	December 31, 2014
Financial Assets	Total			Level 1		Level 2		Level 3
Cash and cash equivalents:
Short-term investment funds	$	2,344		$	—	$	2,344	$	—
Equity securities:
Common stock- U.S. listed small cap	3,631			3,631		—		—
Preferred stock	240			240		—		—
Mutual funds- U.S. listed large cap	10,890			10,890		—		—
Common/collective trust- foreign listed	3,374			—		3,374		—
Fixed maturity securities:
U.S. & foreign government and government agencies and authorities	6,930			—		6,930		—
Corporate- U.S. & foreign investment grade	12,874			—		12,874		—
Corporate- U.S. & foreign high yield	3,175			—		3,175		—
Investment fund:
Multi-strategy hedge fund	3,595			—		—		3,595
Commingled real estate fund	2,476			—		2,476		—
Private equity fund	263			—		—		263
Derivatives:
Interest rate swap	811			—		811		—
Total financial assets	$	50,603	₍₁₎	$	14,761	$	31,984	$	3,858


(1)	The difference between the fair value of plan assets above and the amount used in determining the funded status is due to interest receivable which is not required to be included in the fair value hierarchy.

The following table for the Company’s qualified pension plan and retirement health benefit plan summarizes the change in fair value associated with the MIMSF and Private Equity Partners XI Limited Partnership, the only Level 3 financial assets.



	Pension Benefit			Retirement Health Benefit
Beginning balance at December 31, 2014	$	67,746		$	3,858
Purchases	1,403			79
Refund of capital	(86		)	(5		)
Actual return on plan assets and plan expenses still held at the reporting date	(1,092		)	(107		)
Ending balance at December 31, 2015	$	67,971		$	3,825

For all the financial assets included in the above hierarchy, the market valuation technique is used. For the year ended December 31, 2015, the application of the valuation technique applied to similar assets has been consistent.

Level 1 and Level 2 securities are valued using various observable market inputs obtained from a pricing service. The pricing service prepares estimates of fair value measurements for our Level 2 securities using proprietary valuation models based on techniques such as matrix pricing which include observable market inputs. Observable market inputs for Level 1 and 2 securities are consistent with the observable market inputs described in Note 6 - Fair Value Disclosures. The MIFSF utilizes all three levels of inputs to price its holdings. Since unobservable inputs may have been significant to the fair value measurement, it was classified as Level 3.

The Company obtains one price for each investment. A quarterly analysis is performed to assess if the evaluated prices represent a reasonable estimate of their fair value. This process involves quantitative and qualitative analysis and is overseen by benefits, investment and accounting professionals. Examples of procedures performed include, but are not limited to, initial and on-going review of pricing service methodologies, review of pricing statistics and trends, and comparison of prices for certain securities with two different appropriate price sources for reasonableness. Following this analysis, the Company uses the best estimate of fair value based upon all available inputs. The pricing service provides information regarding their pricing procedures so that the Company can properly categorize the Plans’ financial assets in the fair value hierarchy.

Due to the Plan's current funding status, no contributions are expected to be made to its qualified pension plan in 2016. No contributions are expected to be made to the retirement health benefit plan in 2016.

The following pension benefits, which reflect expected future service, as appropriate, are expected to be paid:



	Pension Benefits		Retirement Health Benefits
2016	$	60,555	$	4,000
2017	58,245		4,361
2018	57,881		4,708
2019	60,056		5,066
2020	75,144		5,446
2021 - 2025	394,654		32,844
Total	$	706,535	$	56,425

Defined Contribution Plan

The Company and its subsidiaries participate in a defined contribution plan covering substantially all employees. The defined contribution plan provides benefits payable to participants on retirement or disability and to beneficiaries of participants in the event of the participant’s death. The amounts expensed by the Company related to this plan were $44,455, $44,796 and $39,263 in 2015, 2014, and 2013, respectively.