XML 28 R12.htm IDEA: XBRL DOCUMENT

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

6 Months Ended

Jun. 30, 2018

Notes

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure

Note 4.Investment Securities

The cost (amortized cost with respect to certain fixed maturities), gross unrealized gains, gross unrealized losses and fair value of fixed maturities available-for-sale are as follows for the periods indicated (in thousands):

		`June 30, 2018`
				`GROSS`		`GROSS`
		AMORTIZED		UNREALIZED		UNREALIZED		`FAIR`
		`COST`		`GAINS`		`LOSSES`		`VALUE`

FIXED MATURITIES
AVAILABLE-FOR-SALE:
Corporate securities	$	`188,640`	$	`12`	$	`(6,688)`	$	`181,964`
CMOs – residential (1)		`6,464`		`-`		`(337)`		`6,127`
U.S. Government obligations		`56,158`		`-`		`(706)`		`55,452`
Agency MBS – residential (2)		`8`		`-`		`-`		`8`
GSEs (3)		`9,673`		`-`		`(238)`		`9,435`
States and political subdivisions		`179,230`		`170`		`(6,373)`		`173,027`
Foreign government obligations		`4,130`		`-`		`(103)`		`4,027`
Redeemable preferred stocks		`10,006`		`142`		`(111)`		`10,037`

Total fixed maturities	$	`454,309`	$	`324`	$	`(14,556)`	$	`440,077`

		`December 31, 2017`
				`GROSS`		`GROSS`
		AMORTIZED		UNREALIZED		UNREALIZED		`FAIR`
		`COST`		`GAINS`		`LOSSES`		`VALUE`

FIXED MATURITIES
AVAILABLE-FOR-SALE:
Corporate securities	$	`148,996`	$	`298`	$	`(2,847)`	$	`146,447`
CMOs - residential (1)		`6,857`		`-`		`(180)`		`6,677`
U.S. Government obligations		`85,510`		`-`		`(396)`		`85,114`
Agency MBS - residential (2)		`14`		`-`		`-`		`14`
GSEs (3)		`9,887`		`-`		`(205)`		`9,682`
States and political subdivisions		`182,664`		`598`		`(3,619)`		`179,643`
Foreign government obligations		`4,227`		`13`		`(90)`		`4,150`
Redeemable preferred stocks		`10,006`		`179`		`-`		`10,185`

Total fixed maturities	$	`448,161`	$	`1,088`	$	`(7,337)`	$	`441,912`

(1)Collateralized mortgage obligations (“CMOs”).

(2) Mortgage-backed securities (“MBS”).

(3)Government-sponsored enterprises (“GSEs”) are private enterprises established and chartered by the Federal Government or its various insurance and lease programs which carry the full faith and credit obligation of the U.S. Government.

The amortized cost and fair value of fixed maturities available-for-sale at June 30, 2018, by contractual maturity, are shown below (in thousands). Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

			AMORTIZED			FAIR
			COST			VALUE

Due in one year or less		$	35,513		$	35,334
Due after one year through five years			163,610			160,024
Due after five years through ten years			139,524			134,911
Due after ten years			99,516			94,237
Fixed maturities with no single maturity date			16,146			15,571

		$	454,309		$	440,077

The following tables summarize, for all fixed maturities available-for-sale in an unrealized loss position, the aggregate fair value and gross unrealized loss by length of time those securities that have continuously been in an unrealized loss position for the periods indicated (in thousands):

		June 30, 2018

		Less than 12 Months						12 Months or Longer						Total

		Fair			Unrealized			Fair			Unrealized			Fair		Unrealized
		Value			Losses			Value			Losses			Value		Losses

Corporate securities	$	98,849		$	`2,692`		$	76,271		$	`3,996`		$	175,120	$	`6,688`
CMOs - residential		-			`-`			6,089			`337`			6,089		`337`
U.S. Government obligations		43,284			`314`			12,168			`392`			55,452		`706`
GSEs		-			`-`			9,426			`238`			9,426		`238`
States and political subdivisions		72,880			`1,651`			86,243			`4,722`			159,123		`6,373`
Foreign government obligations		1,162			`2`			2,865			`101`			4,027		`103`
Redeemable preferred stocks		5,859			`111`			-			`-`			5,859		`111`

Fixed maturities in an
unrealized loss position	$	222,034		$	`4,770`		$	193,062		$	`9,786`		$	415,096	$	`14,556`

Number of fixed maturities in an
unrealized loss position		110						81						191

		December 31, 2017

		Less than 12 Months						12 Months or Longer						Total

		Fair			Unrealized			Fair			Unrealized			Fair		Unrealized
		Value			Losses			Value			Losses			Value		Losses

Corporate securities	$	85,642		$	`1,250`		$	44,640		$	`1,597`		$	130,282	$	`2,847`
CMOs - residential		1,381			`45`			5,237			`135`			6,618		`180`
U.S. Government obligations		75,811			`198`			9,302			`198`			85,113		`396`
GSEs		-			`-`			9,669			`205`			9,669		`205`
States and political subdivisions		83,682			`1,348`			66,617			`2,271`			150,299		`3,619`
Foreign government obligations		2,959			`90`			-			`-`			2,959		`90`

Fixed maturities in an
unrealized loss position	$	249,475		$	`2,931`		$	135,465		$	`4,406`		$	384,940	$	`7,337`

Number of fixed maturities in an
unrealized loss position		60						76						136

Substantially all of the unrealized losses on fixed maturities available-for-sale at June 30, 2018 and December 31, 2017 relate to investment grade securities and are attributable to changes in market interest rates. Because the Company does not intend to sell, nor is it more likely than not that the Company will have to sell such investments before recovery of their amortized cost bases, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired at June 30, 2018.

Net investment gains (losses) are as follows for periods indicated (in thousands):

		Three Months Ended				Six Months Ended
		June 30,				June 30,
		2018		2017		2018		2017

Realized gains (losses):
Fixed maturities available-for-sale	$	`(366)`	$	`146`	$	`(195)`	$	`343`
Equity securities		`(5)`		`-`		`(5)`		`-`

Total realized gains (losses) on debt and equity securities		`(371)`		`146`		`(200)`		`343`
Unrealized gains (losses) on equity securities		`(52)`		`(47)`		`(152)`		`(72)`

Gains (losses) on debt and equity securities		`(423)`		`99`		`(352)`		`271`
Gains (losses) on other investments		`-`		`1`		`-`		`1`

Net investment gains (losses)	$	`(423)`	$	`100`	$	`(352)`	$	`272`

For the three months and six months ended June 30, 2018, the Company realized gross gains of $73,000 and $319,000, respectively, and gross losses of $439,000 and $514,000, respectively, from sales, maturities and prepayments of fixed maturities available-for-sale. For the three months and six months ended June 30, 2017, the company realized gross gains of $365,000 and $1,339,000, respectively, and gross losses of $219,000 and $996,000, respectively, from sales, maturities and prepayments of fixed maturities available for sale.

Other-Than-Temporary Impairment Evaluations

We recognize other-than-temporary impairment losses in earnings in the period that we determine: 1) we intend to sell the security; 2) it is more likely than not that we will be required to sell the security before recovery of its amortized cost basis; or 3) the security has a credit loss. Any non-credit portion of the other-than-temporary impairment loss is recognized in other comprehensive income (loss). See Note 1F(iv) to the Consolidated Financial Statements in the 2017 Annual Report on Form 10-K for further discussion of the factors considered by management in its regular review to identify and recognize other-than-temporary impairments on fixed maturities available-for-sale. The Company did not recognize any other-than-temporary impairments on fixed maturities available-for-sale securities in the first six months of 2018 or 2017.