Investment Securities (Tables)

3 Months Ended

Mar. 31, 2013

Schedule of the cost/amortized cost, unrealized gains and losses, and fair value of investment securities by type, which are classified as available-for-sale

	Cost/
	Amortized		Unrealized		Unrealized			Fair
(dollars in thousands)	Cost		Gains		Losses			Value

March 31, 2013

Fixed maturity investment securities:
Bonds:
U.S. government and government sponsored entities	$	36,586	$	2,253	$	-		$	38,839
Obligations of states, municipalities, and political subdivisions	125,172		4,630		(269		)	129,533
Corporate debt	256,279		10,135		(1,035		)	265,379
Mortgage-backed, asset-backed, and collateralized:
Residential mortgage-backed securities (RMBS)	160,253		8,573		(271		)	168,555
Commercial mortgage-backed securities (CMBS)	13,866		1,354		(9		)	15,211
Collateralized debt obligations (CDO)/Asset-backed securities (ABS)	18,066		1,132		-			19,198
Total	610,222		28,077		(1,584		)	636,715
Other long-term investments*	1,405		2		(67		)	1,340
Common stocks	975		46		(17		)	1,004
Total	$	612,602	$	28,125	$	(1,668	)	$	639,059

December 31, 2012

Fixed maturity investment securities:
Bonds:
U.S. government and government sponsored entities	$	33,955	$	2,487	$	-		$	36,442
Obligations of states, municipalities, and political subdivisions	135,476		4,997		(249		)	140,224
Corporate debt	278,555		10,514		(1,380		)	287,689
Mortgage-backed, asset-backed, and collateralized:
RMBS	164,308		7,948		(47		)	172,209
CMBS	11,964		1,152		(64		)	13,052
CDO/ABS	15,358		1,214		(4		)	16,568
Total	639,616		28,312		(1,744		)	666,184
Other long-term investments*	1,404		-		(24		)	1,380
Common stocks	974		30		(29		)	975
Total	$	641,994	$	28,342	$	(1,797	)	$	668,539

* Excludes interest in a limited partnership that we account for using the equity method ($0.6 million at March 31, 2013 and December 31, 2012).

Schedule of fair value and unrealized losses on investment securities by type and length of time in a continuous unrealized loss position

	Less Than 12 Months					12 Months or Longer					Total
	Fair		Unrealized			Fair		Unrealized			Fair		Unrealized
(dollars in thousands)	Value		Losses			Value		Losses			Value		Losses

March 31, 2013

Bonds:
Obligations of states, municipalities, and political subdivisions	$	-	$	-		$	3,764	$	(269	)	$	3,764	$	(269	)
Corporate debt	32,482		(554		)	25,807		(481		)	58,289		(1,035		)
RMBS	24,555		(270		)	41		(1		)	24,596		(271		)
CMBS	730		(9		)	-		-			730		(9		)
CDO/ABS	2,900		-			-		-			2,900		-
Total	60,667		(833		)	29,612		(751		)	90,279		(1,584		)
Other long-term investments	134		(67		)	-		-			134		(67		)
Common stocks	-		-			97		(17		)	97		(17		)
Total	$	60,801	$	(900	)	$	29,709	$	(768	)	$	90,510	$	(1,668	)

December 31, 2012

Bonds:
Obligations of states, municipalities, and political subdivisions	$	1,569	$	(4	)	$	9,646	$	(245	)	$	11,215	$	(249	)
Corporate debt	23,673		(510		)	49,690		(870		)	73,363		(1,380		)
RMBS	29,101		(46		)	46		(1		)	29,147		(47		)
CMBS	712		(31		)	4,913		(33		)	5,625		(64		)
CDO/ABS	792		(4		)	-		-			792		(4		)
Total	55,847		(595		)	64,295		(1,149		)	120,142		(1,744		)
Other long-term investments	178		(23		)	8		(1		)	186		(24		)
Common stocks	-		-			85		(29		)	85		(29		)
Total	$	56,025	$	(618	)	$	64,388	$	(1,179	)	$	120,413	$	(1,797	)

Schedule of components of other-than-temporary impairment charges on investment securities

(dollars in thousands)
Three Months Ended March 31,	2013			2012

Total other-than-temporary impairment losses	$	(26	)	$	(41	)
Portion of loss recognized in accumulated other comprehensive loss	-			-
Net impairment losses recognized in net loss	$	(26	)	$	(41	)

Schedule of changes in the cumulative amount of credit losses (recognized in earnings) on other-than-temporarily impaired investment securities

(dollars in thousands)
At or for the Three Months Ended March 31,	2013		2012

Balance at beginning of period	$	1,650	$	3,725
Additions:
Due to other-than-temporary impairments:
Impairment not previously recognized	-		-
Impairment previously recognized	26		41
Reductions:
Realized due to sales with no prior intention to sell	-		-
Realized due to intention to sell	-		-
Accretion of credit impaired securities	-		-
Balance at end of period	$	1,676	$	3,766

Schedule of fair values of investment securities sold or redeemed and the resulting realized gains, realized losses, and net realized (losses) gains

(dollars in thousands)
Three Months Ended March 31,	2013			2012

Fair value	$	35,291		$	15,183

Realized gains	$	167		$	161
Realized losses	(170		)	(88		)
Net realized gains (losses)	$	(3	)	$	73

Schedule of contractual maturities of fixed-maturity investment securities

(dollars in thousands)	Fair		Amortized
March 31, 2013	Value		Cost

Fixed maturities, excluding mortgage-backed securities:
Due in 1 year or less	$	34,264	$	34,193
Due after 1 year through 5 years	178,894		172,278
Due after 5 years through 10 years	154,050		149,222
Due after 10 years	66,543		62,344
Mortgage-backed, asset-backed, and collateralized securities	202,964		192,185
Total	$	636,715	$	610,222

- Definition

Tabular disclosure of the amount of other than temporary impairment (OTTI) related to credit losses recognized in earnings including: (a) the beginning balance of the amount related to credit losses on debt securities held by the investor at the beginning of the period for which a portion of an OTTI was recognized in other comprehensive income; (b) additions for the amount related to the credit loss for which an OTTI was not previously recognized; (c) reductions for securities sold during the period (realized); (d) reductions for securities for which the amount previously recognized in other comprehensive income was recognized in earnings because the investor intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost basis; (e) additional increases to the amount related to the credit loss for which an OTTI was previously recognized when the investor does not intend to sell the security and it is not more likely than not that the investor will be required to sell the security before recovery of its amortized cost basis; (f) reductions for increases in cash flows expected to be collected that are recognized over the remaining life of the security; and (g) the ending balance of the amount related to credit losses on debt securities held by the entity at the end of the period for which a portion of an OTTI was recognized in other comprehensive income.

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