Investments

3 Months Ended

Jun. 30, 2013

Investments, Debt and Equity Securities [Abstract]

3. Investments

3. Investments

Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

We deposit bonds with insurance regulatory authorities to meet statutory requirements. The adjusted cost of bonds on deposit with insurance regulatory authorities was $16.4 million at June 30, 2013.

Available-for-Sale Investments

Available-for-sale investments at June 30, 2013 were as follows:

		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses More than 12 Months		Gross Unrealized Losses Less than 12 Months		Estimated Market Value
		(Unaudited)
		(In thousands)
U.S. treasury securities and government obligations	$	28,083	$	2,568	$	(3	)$	(3	)$	30,645
U.S. government agency mortgage-backed securities		42,332		3,627		(5	)	(34	)	45,920
Obligations of states and political subdivisions		154,644		16,482		-		(382	)	170,744
Corporate securities		754,664		49,736		(195	)	(4,276	)	799,929
Mortgage-backed securities		6,117		251		(28	)	-		6,340
Redeemable preferred stocks		21,163		871		(28	)	(6	)	22,000
Common stocks		43,219		1,660		(3,405	)	(44	)	41,430
	$	1,050,222	$	75,195	$	(3,664	)$	(4,745	)$	1,117,008

The table above includes gross unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position.

We sold available-for-sale securities with a fair value of $44.2 million during the first quarter of fiscal 2014. The gross realized gains on these sales totaled $1.2 million. There were no gross realized losses on these sales.

The unrealized losses of more than twelve months in the available-for-sale table are considered temporary declines. The majority of this unrealized loss is related to our long term investments in 1.8 million shares of Bank of America common stock. We track each investment with an unrealized loss and evaluate them on an individual basis for other-than-temporary impairments including obtaining corroborating opinions from third party sources, performing trend analysis and reviewing management's future plans. Certain of these investments may have declines determined by management to be other-than-temporary and we recognized these write-downs through earnings. There were no write downs in the first quarter of fiscal 2014 and 2013.

The investment portfolio primarily consists of corporate securities and U.S. government securities. We believe we monitor our investments as appropriate. Our methodology of assessing other-than-temporary impairments is based on security-specific analysis as of the balance sheet date and considers various factors including the length of time to maturity, the extent to which the fair value has been less than the cost, the financial condition and the near-term prospects of the issuer, and whether the debtor is current on its contractually obligated interest and principal payments. Nothing has come to management's attention that would lead to the belief that each issuer would not have the ability to meet the remaining contractual obligations of the security, including payment at maturity. We have the ability and intent not to sell our fixed maturity and common stock investments for a period of time sufficient to allow us to recover our costs.

The portion of other-than-temporary impairment related to a credit loss is recognized in earnings. The significant inputs utilized in the evaluation of mortgage backed securities credit losses include ratings, delinquency rates, and prepayment activity. The significant inputs utilized in the evaluation of asset backed securities credit losses include the time frame for principal recovery and the subordination and value of the underlying collateral.

Credit losses recognized in earnings for which a portion of an other-than-temporary impairment was recognized in other comprehensive income were as follows:

		Credit Loss
		(Unaudited)
		(In thousands)
Balance at March 31, 2013	$	552
Additions:
Other-than-temporary impairment not previously recognized		-
Balance at June 30, 2013	$	552

The adjusted cost and estimated market value of available-for-sale investments at June 30, 2013, by contractual maturity, were as follows:

		Amortized Cost		Estimated Market Value
		(Unaudited)
		(In thousands)
Due in one year or less	$	40,195	$	40,825
Due after one year through five years		172,665		183,996
Due after five years through ten years		293,659		315,929
Due after ten years		473,204		506,488
		979,723		1,047,238
Mortgage backed securities		6,117		6,340
Redeemable preferred stocks		21,163		22,000
Common stocks		43,219		41,430
	$	1,050,222	$	1,117,008