Investments

The Company invests primarily in fixed maturity securities, which totaled 90.0% of total cash, cash equivalents and investments at March 31, 2019. The Company's cash, cash equivalents and investments are listed below.



	March 31, 2019			December 31, 2018
	Carrying Value		% of Total Carrying Value	Carrying Value		% of Total Carrying Value
	(In thousands)			(In thousands)
Fixed maturity securities	$	1,295,514	90.0	$	1,231,039	88.7
Equity securities	15,672		1.1	15,068		1.1
Mortgage loans	185		—	186		—
Policy loans	81,474		5.7	80,825		5.8
Real estate and other long-term investments	5,715		0.4	7,223		0.5
Short-term investments	7,914		0.4	7,865		0.6
Cash and cash equivalents	34,093		2.4	45,492		3.3
Total cash, cash equivalents and investments	$	1,440,567	100.0	$	1,387,698	100.0

The following tables represent the cost or amortized cost, gross unrealized gains and losses and fair value for fixed maturities as of the periods indicated.



	March 31, 2019
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale:
U.S. Treasury securities	$	9,841	1,492	—	11,333
U.S. Government-sponsored enterprises	3,534		846	—	4,380
States and political subdivisions	686,141		12,434	460	698,115
Corporate	438,608		18,344	2,518	454,434
Commercial mortgage-backed	887		—	—	887
Residential mortgage-backed	115,463		6,021	3	121,481
Asset-backed	4,763		3	1	4,765
Foreign governments	116		3	—	119
Total fixed maturities	$	1,259,353	39,143	2,982	1,295,514



	December 31, 2018
	Cost or Amortized Cost		Gross Unrealized Gains	Gross Unrealized Losses	Fair Value
	(In thousands)
Fixed maturities:
Available-for-sale securities:
U.S. Treasury securities	$	9,864	1,410	—	11,274
U.S. Government-sponsored enterprises	3,540		740	—	4,280
States and political subdivisions	713,991		7,614	1,490	720,115
Corporate	384,817		6,725	9,746	381,796
Commercial mortgage-backed	39,694		386	66	40,014
Residential mortgage-backed	66,960		1,726	2	68,684
Asset-backed	4,764		1	8	4,757
Foreign governments	117		2	—	119
Total fixed maturities	$	1,223,747	18,604	11,312	1,231,039

Most of the Company's equity securities are diversified stock and bond mutual funds.



	March 31, 2019		December 31, 2018
	Fair Value		Fair Value
	(In thousands)
Equity securities:
Stock mutual funds	$	3,091	2,906
Bond mutual funds	12,143		11,774
Common stock	133		94
Non-redeemable preferred stock	305		294
Total equity securities	$	15,672	15,068

Valuation of Investments in Fixed Maturity and Equity Securities

Available-for-sale securities are reported in the consolidated financial statements at fair value. Equity securities are measured at fair value with the change in fair value recorded through net income. The Company recognized net realized gains of $602,000 and net realized losses of $302,000 on equity securities held for the three months ended March 31, 2019 and 2018, respectively.

The Company monitors all debt securities on an on-going basis relative to changes in credit ratings, market prices, earnings trends and financial performance, in addition to specific region or industry reviews. The assessment of whether other-than-temporary impairments ("OTTI") have occurred is based on a case-by-case evaluation of underlying reasons for the decline in fair value. The Company determines OTTI by reviewing relevant evidence related to the specific security issuer as well as the Company's intent to sell the security, or if it is more likely than not that the Company would be required to sell a security before recovery of its amortized cost.

When an OTTI has occurred, the amount of the OTTI recognized in earnings depends on whether the Company intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis. If the Company intends to sell the security or it is more likely that the Company will be required to sell the security before recovery of its amortized cost basis, the OTTI is recognized in earnings equal to the entire difference between the investment's amortized cost and its fair value at the balance sheet date. If the Company does not intend to sell the security and it is more likely than not that the Company will not be required to sell the security before recovery of its amortized cost basis, the OTTI is separated into the following: (a) the amount representing the credit loss; and (b) the amount related to all other factors. The amount of the total OTTI related to the credit loss is recognized in earnings. The amount of the total OTTI related to other factors is recognized in other comprehensive income, net of applicable taxes. The previous amortized cost basis less the OTTI recognized in earnings becomes the new amortized cost basis of the investment. The new amortized cost basis is not adjusted for subsequent recoveries in fair value.

The Company evaluates whether a credit impairment exists for fixed maturity securities by considering primarily the following factors: (a) changes in the financial condition of the security's underlying collateral; (b) whether the issuer is current on contractually obligated interest and principal payments; (c) changes in the financial condition, credit rating and near-term prospects of the issuer; (d) the length of time to which the fair value has been less than the amortized cost of the security; and (e) the payment structure of the security. The Company's best estimate of expected future cash flows used to determine the credit loss amount is a quantitative and qualitative process. Quantitative review includes information received from third party sources such as financial statements, pricing and rating changes, liquidity and other statistical information. Qualitative factors include judgments related to business strategies, economic impacts on the issuer and overall judgment related to estimates and industry factors. The Company's best estimate of future cash flows involves assumptions including, but not limited to, various performance indicators, such as historical and projected default and recovery rates, credit ratings, and current delinquency rates. These assumptions require the use of significant management judgment and include the probability of issuer default and estimates regarding timing and amount of expected recoveries, which may include estimating the underlying collateral value. In addition, projections of expected future debt security cash flows may change based upon new information regarding the performance of the issuer.

No bond impairments were recognized for the three months ended March 31, 2019. OTTI of $225,000 was recognized on one bond issuer for the three months ended March 31, 2018.

The following tables present the fair values and gross unrealized losses of fixed maturity securities that have remained in a continuous unrealized loss position for the periods indicated.



	March 31, 2019
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
States and political subdivisions	$	67,893	75	60	51,053	385	70	118,946	460	130
Corporate	53,090		1,747	42	19,818	771	24	72,908	2,518	66
Residential mortgage-backed	—		—	—	96	3	5	96	3	5
Asset-backed	2,001		1	2	—	—	—	2,001	1	2
Total available-for-sale securities	$	122,984	1,823	104	70,967	1,159	99	193,951	2,982	203



	December 31, 2018
	Less than 12 months				Greater than 12 months			Total
	Fair Value		Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities	Fair Value	Unrealized Losses	# of Securities
	(In thousands, except for # of securities)
Fixed maturities:
Available-for-sale securities:
States and political subdivisions	$	227,132	883	233	33,891	607	46	261,023	1,490	279
Corporate	230,030		8,770	191	9,936	976	8	239,966	9,746	199
Commercial mortgage-backed	14,992		66	11	—	—	—	14,992	66	11
Residential mortgage-backed	18		—	3	98	2	4	116	2	7
Asset-backed	3,747		8	4	—	—	—	3,747	8	4
Total fixed maturities	$	475,919	9,727	442	43,925	1,585	58	519,844	11,312	500

We have reviewed these securities in an unrealized loss position for the periods ended March 31, 2019 and December 31, 2018 and determined that no OTTI exists that have not been recognized based on our evaluation of the credit worthiness of the issuers and the fact that we do not intend to sell the investments nor is it likely that we will be required to sell the securities before recovery of their amortized cost bases which may be maturity. We continue to monitor all securities on an on-going basis and future information may become available which could result in other-than-temporary impairments being recorded.

The amortized cost and fair value of fixed maturity securities at March 31, 2019 by contractual maturity are shown in the table below. Actual maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Securities not due at a single maturity date have been reflected based upon final stated maturity.



	March 31, 2019
	Amortized Cost		Fair Value
	(In thousands)
Fixed maturity securities:
Due in one year or less	$	79,036	79,178
Due after one year through five years	131,849		134,746
Due after five years through ten years	215,686		222,226
Due after ten years	832,782		859,364
Total fixed maturity securities	$	1,259,353	1,295,514

The Company uses the specific identification method of the individual security to determine the cost basis used in the calculation of realized gains and losses related to security sales.



	Fixed Maturities, Available-for-Sale			Equity Securities
	Three Months Ended			Three Months Ended
	March 31,			March 31,
	2019		2018	2019	2018
	(In thousands)

Proceeds	$	7,659	—	—	—
Gross realized gains	$	2	—	—	—
Gross realized losses	$	183	—	—	—

There were sales of ten available-for-sale fixed maturity securities for the three months ended March 31, 2019. No available-for-sale fixed maturity securities were sold during the three months ended March 31, 2018. No equity securities were sold during the three months ended March 31, 2019 and 2018.