Investments

3 Months Ended

Mar. 31, 2022

Investments Debt And Equity Securities [Abstract]

Investments

2. Investments

The cost or amortized cost, gross unrealized gains or losses, and estimated fair value of the investments in securities classified as available for sale at March 31, 2022 and December 31, 2021, were as follows (dollars in thousands):

	March 31, 2022
	Cost or		Gross Unrealized					Estimated
	Amortized Cost		Gains		Losses			Fair Value
Debt Securities:
U.S. Government	$	18,541	$	8	$	(291	)	$	18,258
State and local government		29,866		49		(1,846	)		28,069
Corporate debt		35,345		11		(2,586	)		32,770
Asset-backed securities		27,952		2		(723	)		27,231
Mortgage-backed securities		31,870		9		(2,571	)		29,308
Commercial mortgage-backed securities		3,424		1		(55	)		3,370
Collateralized mortgage obligations		5,219		4		(194	)		5,029
Total debt securities available for sale	$	152,217	$	84	$	(8,266	)	$	144,035

	December 31, 2021
	Cost or		Gross Unrealized					Estimated
	Amortized Cost		Gains		Losses			Fair Value
Debt Securities:
U.S. Government	$	20,723	$	74	$	(77	)	$	20,720
State and local government		30,063		555		(189	)		30,429
Corporate debt		30,808		88		(550	)		30,346
Asset-backed securities		28,652		10		(224	)		28,438
Mortgage-backed securities		33,178		105		(762	)		32,521
Commercial mortgage-backed securities		1,659		31		0			1,690
Collateralized mortgage obligations		5,649		35		(45	)		5,639
Total debt securities available for sale	$	150,732	$	898	$	(1,847	)	$	149,783

The following table summarizes the aggregate fair value and gross unrealized losses, by security type, of the available-for-sale securities in unrealized loss positions. The table segregates the holdings based on the length of time that individual securities have been in a continuous unrealized loss position (dollars in thousands):

	March 31, 2022
	Less than 12 months							Greater than 12 months							Total
	No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
Debt Securities:
U.S. Government		8	$	10,508	$	(93	)		4	$	6,482	$	(198	)		12	$	16,990	$	(291	)
State and local government		108		21,485		(1,724	)		8		866		(122	)		116		22,351		(1,846	)
Corporate debt		54		23,456		(1,686	)		12		7,982		(900	)		66		31,438		(2,586	)
Asset-backed securities		21		13,448		(122	)		8		12,240		(601	)		29		25,688		(723	)
Mortgage-backed securities		29		6,714		(343	)		7		22,224		(2,228	)		36		28,938		(2,571	)
Commercial mortgage-backed securities		3		3,111		(55	)		—		—		—			3		3,111		(55	)
Collateralized mortgage obligations		18		3,418		(117	)		5		1,274		(77	)		23		4,692		(194	)
Total debt securities available for sale		241	$	82,140	$	(4,140	)		44	$	51,068	$	(4,126	)		285	$	133,208	$	(8,266	)

	December 31, 2021
	Less than 12 months							Greater than 12 months							Total
	No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses			No. of Issues		Fair Value of Investments with Unrealized Losses		Gross Unrealized Losses
Debt Securities:
U.S. Government		6	$	10,323	$	(47	)		1	$	4,728	$	(30	)		7	$	15,051	$	(77	)
State and local government		41		8,875		(172	)		4		446		(17	)		45		9,321		(189	)
Corporate debt		41		22,748		(505	)		1		705		(45	)		42		23,453		(550	)
Asset-backed securities		24		24,305		(219	)		2		1,893		(5	)		26		26,198		(224	)
Mortgage-backed securities		12		27,034		(762	)		—		—		—			12		27,034		(762	)
Commercial mortgage-backed securities		—		—		—			—		—		—			—		—		—
Collateralized mortgage obligations		10		2,638		(45	)		2		29		—			12		2,667		(45	)
Total debt securities available for sale		134	$	95,923	$	(1,750	)		10	$	7,801	$	(97	)		144	$	103,724	$	(1,847	)

The Company analyzed its investment portfolio in accordance with its other-than-temporary impairment ("OTTI") review procedures and determined the Company did not need to record a credit-related OTTI loss in net income, nor recognize a non-credit related OTTI loss in other comprehensive income for the three months ended March 31, 2022 and 2021.

The Company’s sources of net investment income and losses are as follows (dollars in thousands):

	Three Months Ended March 31,
	2022			2021
Debt securities	$	582		$	600
Equity securities		28			48
Cash, cash equivalents and short-term investments		1			1
Total investment income		611			649
Investment expenses		(104	)		(117	)
Net investment income	$	507		$	532

The following table summarizes the gross realized gains and losses from sales, calls and maturities of available-for-sale debt and equity securities (dollars in thousands):

	Three Months Ended March 31,
	2022			2021
Debt securities:
Gross realized gains	$	—		$	27
Gross realized losses		—			(6	)
Total debt securities		—			21
Equity securities:
Gross realized gains		19			2,903
Gross realized losses		(88	)		—
Total equity securities		(69	)		2,903
Total net realized investment gains (losses)	$	(69	)	$	2,924

Proceeds from available-for-sale debt securities were $6.7 million and $14.2 million for the three months ended March 31, 2022 and 2021, respectively. There were no gross realized gains or losses from the sales of available-for-sale securities for the three months ended March 31, 2022. The gross realized gains and losses from the sales of available-for-sale debt securities for the three months ended March 31, 2021, were $27,000 and $6,000, respectively.  

As of March 31, 2022 and 2021, there were $750,000 and $0 of payables from securities purchased, respectively.  There were $1.3 million and $3,000 of receivables from securities sold as of March 31, 2022, and 2021, respectively.

The Company carries other equity investments that do not have a readily determinable fair value at cost, less impairment or observable changes in price.  We review these investments for impairment during each reporting period.  There were no impairments or observable changes in price recorded during 2022 related to the Company's equity securities without readily determinable fair value.  These investments are included in Other Assets in the Consolidated Balance Sheets and amounted to $1.2 million as of March 31, 2022 and December 31, 2021.  

The table below summarizes the amortized cost and fair value of available-for-sale debt securities by contractual maturity at March 31, 2022.  Actual maturities may differ from contractual maturities because certain borrowers have the right to call or prepay obligations with or without call or prepayment penalties (dollars in thousands):

	Amortized Cost		Estimated Fair Value
Due in one year or less	$	10,388	$	10,361
Due after one year through five years		33,732		32,466
Due after five years through ten years		23,806		21,843
Due after ten years		15,826		14,427
Securities with contractual maturities		83,752		79,097
Asset-backed securities		27,952		27,231
Mortgage-backed securities		31,870		29,308
Commercial mortgage-backed securities		3,424		3,370
Collateralized mortgage obligations		5,219		5,029
Total debt securities	$	152,217	$	144,035

At March 31, 2022 and December 31, 2021, the Insurance Company Subsidiaries had $8.2 million and $8.5 million, respectively, on deposit in trust accounts to meet the deposit requirements of various state insurance departments.  At March 31, 2022 and December 31, 2021, the Company had $78.0 million and $76.1 million, respectively, held in trust accounts to meet collateral requirements with other third-party insurers, relating to various fronting arrangements.  There are withdrawal and other restrictions on these deposits, including the type of investments that may be held, however, the Company may generally invest in high-grade bonds and short-term investments and earn interest on the funds.