10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________________  to ___________________

Commission File Number:  0-11774

INVESTORS TITLE COMPANY

(Exact name of registrant as specified in its charter)

North Carolina	56-1110199
(State of incorporation)	(I.R.S. Employer Identification No.)

121 North Columbia Street, Chapel Hill, North Carolina 27514

(Address of principal executive offices)  (Zip Code)

(919) 968-2200

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:

Title of each class	Trading symbol(s)	Name of each exchange on which registered
Common Stock, no par value	ITIC	The Nasdaq Stock Market LLC
Rights to Purchase Series A Junior Participating Preferred Stock		The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.  See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 25, 2022, there were 1,896,982 common shares of the registrant outstanding.

INVESTORS TITLE COMPANY

AND SUBSIDIARIES

INDEX

PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements (unaudited):
	Consolidated Balance Sheets as of September 30, 2022 and December 31, 2021	1
	Consolidated Statements of Operations For the Three and Nine Months Ended September 30, 2022 and 2021	2
	Consolidated Statements of Comprehensive Income For the Three and Nine Months Ended September 30, 2022 and 2021	3
	Consolidated Statements of Stockholders’ Equity For the Three and Nine Months Ended September 30, 2022 and 2021	4
	Consolidated Statements of Cash Flows For the Nine Months Ended September 30, 2022 and 2021	5
	Notes to Consolidated Financial Statements	7
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	24
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	38
Item 5.	Other Information	38
Item 6.	Exhibits	39
SIGNATURE		40

PART I.   FINANCIAL INFORMATION

Item 1.  Financial Statements

Investors Title Company and Subsidiaries

Consolidated Balance Sheets

As of September 30, 2022 and December 31, 2021

(in thousands)

(unaudited)

	September 30, 2022		December 31, 2021
Assets
Cash and cash equivalents	$	41,380	$	37,168
Investments:
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	55,307		79,791
Equity securities, at fair value (cost: September 30, 2022: $28,004; December 31, 2021: $29,478)	52,657		76,853
Short-term investments	80,785		45,930
Other investments	19,673		20,298
Total investments	208,422		222,872
Premiums and fees receivable	23,194		22,953
Accrued interest and dividends	971		817
Prepaid expenses and other receivables	12,527		11,721
Property, net	16,613		13,033
Goodwill and other intangible assets, net	17,954		15,951
Operating lease right-of-use assets	6,258		5,202
Other assets	2,320		1,771
Current income taxes recoverable	3,164		—
Total Assets	$	332,803	$	331,488
Liabilities and Stockholders’ Equity
Liabilities:
Reserve for claims	$	37,630	$	36,754
Accounts payable and accrued liabilities	41,938		43,868
Operating lease liabilities	6,389		5,329
Current income taxes payable	—		3,329
Deferred income taxes, net	7,805		13,121
Total liabilities	93,762		102,401
Commitments and Contingencies	—		—
Stockholders’ Equity:
Preferred stock (1,000 authorized shares; no shares issued)	—		—
Common stock – no par value (10,000 authorized shares; 1,897 and 1,895 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively, excluding in each period 292 shares of common stock held by the Company)	—		—
Retained earnings	239,792		225,861
Accumulated other comprehensive (loss) income	(751)		3,226
Total stockholders' equity	239,041		229,087
Total Liabilities and Stockholders’ Equity	$	332,803	$	331,488

Refer to notes to the Consolidated Financial Statements.

1

Investors Title Company and Subsidiaries

Consolidated Statements of Operations

For the Three and Nine Months Ended September 30, 2022 and 2021

(in thousands, except per share amounts)

(unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Revenues:
Net premiums written	$	66,658	$	72,345	$	199,409	$	201,349
Escrow and other title-related fees	5,963		3,863		17,236		10,148
Non-title services	3,852		2,446		9,114		6,932
Interest and dividends	1,229		893		3,055		2,807
Other investment income	2,173		2,186		4,616		4,610
Net realized investment gains	2,481		268		6,266		771
Changes in the estimated fair value of equity security investments	(4,635)		(802)		(22,722)		7,266
Other	277		217		924		4,572
Total Revenues	77,998		81,416		217,898		238,455
Operating Expenses:
Commissions to agents	33,478		37,570		97,161		102,458
Provision for claims	1,966		1,993		3,452		5,020
Personnel expenses	21,586		15,457		63,738		47,524
Office and technology expenses	4,274		3,175		12,930		9,128
Other expenses	6,606		4,784		19,783		13,285
Total Operating Expenses	67,910		62,979		197,064		177,415
Income before Income Taxes	10,088		18,437		20,834		61,040
Provision for Income Taxes	2,175		3,934		4,457		12,932
Net Income	$	7,913	$	14,503	$	16,377	$	48,108
Basic Earnings per Common Share	$	4.17	$	7.66	$	8.63	$	25.40
Weighted Average Shares Outstanding – Basic	1,897		1,894		1,897		1,894
Diluted Earnings per Common Share	$	4.17	$	7.63	$	8.63	$	25.34
Weighted Average Shares Outstanding – Diluted	1,897		1,900		1,898		1,899

Refer to notes to the Consolidated Financial Statements.

2

Investors Title Company and Subsidiaries

Consolidated Statements of Comprehensive Income

For the Three and Nine Months Ended September 30, 2022 and 2021

(in thousands)

(unaudited)

	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net income	$	7,913	$	14,503	$	16,377	$	48,108
Other comprehensive loss, before income tax:
Accumulated postretirement benefit obligation adjustment	17		—		228		—
Net unrealized losses on investments arising during the period	(1,595)		(433)		(5,537)		(1,064)
Reclassification adjustment for sale of securities included in net income	58		11		104		(19)
Reclassification adjustment for write-down of securities included in net income	35		—		162		—
Other comprehensive loss, before income tax	(1,485)		(422)		(5,043)		(1,083)
Income tax expense related to postretirement health benefits	4		—		48		—
Income tax benefit related to net unrealized losses on investments arising during the period	(338)		(91)		(1,173)		(225)
Income tax expense (benefit) related to reclassification adjustment for sale of securities included in net income	12		2		22		(4)
Income tax expense related to reclassification adjustment for write-down of securities included in net income	8		—		37		—
Net income tax benefit on other comprehensive loss	(314)		(89)		(1,066)		(229)
Other comprehensive loss	(1,171)		(333)		(3,977)		(854)
Comprehensive Income	$	6,742	$	14,170	$	12,400	$	47,254

Refer to notes to the Consolidated Financial Statements.

3

Investors Title Company and Subsidiaries

Consolidated Statements of Stockholders’ Equity

For the Three and Nine Months Ended September 30, 2022 and 2021

(in thousands, except per share amounts)

(unaudited)

	Common Stock			Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Total Stockholders’ Equity
	Shares	Amount
Balance, June 30, 2021	1,894	$	—	$	228,133	$	3,805	$	231,938
Net income				14,503				14,503
Dividends paid ($0.46 per share)				(871)				(871)
Share-based compensation expense related to stock appreciation rights				68				68
Net unrealized loss on investments						(333)		(333)
Balance, September 30, 2021	1,894	$	—	$	241,833	$	3,472	$	245,305
Balance, June 30, 2022	1,897	$	—	$	232,759	$	420	$	233,179
Net income				7,913				7,913
Dividends paid ($0.46 per share)				(873)				(873)
Repurchases of common stock	—			(86)				(86)
Share-based compensation expense related to stock appreciation rights				79				79
Accumulated postretirement benefit obligation adjustment						13		13
Net unrealized loss on investments						(1,184)		(1,184)
Balance, September 30, 2022	1,897	$	—	$	239,792	$	(751)	$	239,041

	Common Stock			Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Total Stockholders’ Equity
	Shares	Amount
Balance, December 31, 2020	1,892	$	—	$	196,096	$	4,326	$	200,422
Net income				48,108				48,108
Dividends paid ($1.36 per share)				(2,576)				(2,576)
Exercise of stock appreciation rights	2			(1)				(1)
Share-based compensation expense related to stock appreciation rights				206				206
Net unrealized loss on investments						(854)		(854)
Balance, September 30, 2021	1,894	$	—	$	241,833	$	3,472	$	245,305
Balance, December 31, 2021	1,895	$	—	$	225,861	$	3,226	$	229,087
Net income				16,377				16,377
Dividends paid ($1.38 per share)				(2,618)				(2,618)
Repurchases of common stock	—			(86)				(86)
Exercise of stock appreciation rights	2			(1)				(1)
Share-based compensation expense related to stock appreciation rights				259				259
Accumulated postretirement benefit obligation adjustment						180		180
Net unrealized loss on investments						(4,157)		(4,157)
Balance, September 30, 2022	1,897	$	—	$	239,792	$	(751)	$	239,041

Refer to notes to the Consolidated Financial Statements.

4

Investors Title Company and Subsidiaries

Consolidated Statements of Cash Flows

For the Nine Months Ended September 30, 2022 and 2021

(in thousands)

(unaudited)

	Nine Months Ended September 30,
	2022		2021
Operating Activities
Net income	$	16,377	$	48,108
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	1,679		1,298
Amortization of investments, net	270		776
Amortization of other intangible assets, net	967		412
Share-based compensation expense related to stock appreciation rights	259		206
Net gain on disposals of property	(50)		(3,991)
Net realized investment gains	(6,266)		(771)
Net change in estimated fair value of equity security investments	22,722		(7,266)
Net earnings from other investments	(2,976)		(2,678)
Provision for claims	3,452		5,020
(Benefit) provision for deferred income taxes	(4,250)		2,953
Changes in assets and liabilities:
Increase in premium and fees receivable	(241)		(3,512)
Increase in other assets	(873)		(4,971)
(Increase) decrease in operating lease right-of-use assets	(1,056)		227
Increase in current income taxes receivable	(3,164)		—
(Decrease) increase in accounts payable and accrued liabilities	(1,702)		1,907
Increase (decrease) in operating lease liabilities	1,060		(245)
(Decrease) increase in current income taxes payable	(3,329)		66
Payments of claims, net of recoveries	(2,576)		(1,849)
Net cash provided by operating activities	20,303		35,690
Investing Activities
Purchases of fixed maturities	(350)		—
Purchases of equity securities	(5,585)		(2,663)
Purchases of short-term investments	(59,072)		(39,370)
Purchases of other investments	(1,300)		(1,084)
Purchases of subsidiary, net of cash	(4,927)		—
Proceeds from sales and maturities of fixed maturity securities	18,870		33,565
Proceeds from sales of equity securities	13,970		6,073
Proceeds from sales and maturities of short-term investments	24,372		3,311
Proceeds from sales and distributions of other investments	4,493		3,298
Proceeds from sales of other assets	30		1
Purchases of property	(3,980)		(6,778)
Proceeds from the sale of property	93		5,321
Net cash (used in) provided by investing activities	(13,386)		1,674
Financing Activities
Repurchases of common stock	(86)		—
Exercise of stock appreciation rights	(1)		(1)
Dividends paid	(2,618)		(2,576)
Net cash used in financing activities	(2,705)		(2,577)
Net Increase in Cash and Cash Equivalents	4,212		34,787
Cash and Cash Equivalents, Beginning of Period	37,168		13,723
Cash and Cash Equivalents, End of Period	$	41,380	$	48,510

5

Consolidated Statements of Cash Flows, continued
	Nine Months Ended September 30,
	2022		2021
Supplemental Disclosures:
Cash Paid During the Year for:
Income tax payments, net	$	15,200	$	9,913
Non-Cash Investing and Financing Activities:
Non-cash net unrealized loss on investments, net of deferred tax benefit of $1,114 and $229 for September 30, 2022 and 2021, respectively	$	4,157	$	854
Adjustments to postretirement benefits obligation, net of deferred tax expense of $(48) and $0 for September 30, 2022 and 2021, respectively	$	(180)	$	—
Changes in Financial Statement Amounts Related to Purchase of Subsidiaries, Net of Cash Received:
Goodwill and other intangibles acquired	$	(2,984)	$	—
Title plant acquired	(500)		—
Prepaid and other assets acquired	(121)		—
Fixed assets acquired	(1,322)		—
Purchase of subsidiary, net of cash received	$	(4,927)	$	—

Refer to notes to the Consolidated Financial Statements.

6

INVESTORS TITLE COMPANY

AND SUBSIDIARIES

Notes to Consolidated Financial Statements

September 30, 2022

(unaudited)

Note 1 – Basis of Presentation and Significant Accounting Policies

Reference should be made to the “Notes to Consolidated Financial Statements” appearing in the Annual Report on Form 10-K for the year ended December 31, 2021 of Investors Title Company (the “Company”) for a complete description of the Company’s significant accounting policies.

Principles of Consolidation – The accompanying unaudited Consolidated Financial Statements include the accounts and operations of Investors Title Company and its subsidiaries, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information, with the instructions to Form 10-Q and with Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows of the Company in the accompanying unaudited Consolidated Financial Statements have been included. All such adjustments are of a normal recurring nature. Operating results for the three- and nine-month periods ended September 30, 2022 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, 2022 or any other interim period.

Use of Estimates and Assumptions – The preparation of the Company’s unaudited Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions used.

Subsequent Events – The Company has evaluated and concluded that there were no material subsequent events requiring adjustment or disclosure to its unaudited Consolidated Financial Statements.

Note 2 – Reserve for Claims

Activity in the reserve for claims for the nine-month period ended September 30, 2022 and the year ended December 31, 2021 is summarized as follows:

(in thousands)	September 30, 2022		December 31, 2021
Balance, beginning of period	$	36,754	$	33,584
Provision charged to operations	3,452		5,686
Payments of claims, net of recoveries	(2,576)		(2,516)
Balance, end of period	$	37,630	$	36,754

The total reserve for all reported and unreported losses the Company incurred through September 30, 2022 is represented by the reserve for claims on the unaudited Consolidated Balance Sheets. The Company's reserves for unpaid losses and loss adjustment expenses are established using estimated amounts required to settle claims for which notice has been received (reported) and the amount estimated to be required to satisfy claims that have been incurred but not yet reported (“IBNR”). Despite the variability of such estimates, management believes that the total reserve for claims is adequate to cover claim losses which might result from pending and future claims under title insurance policies issued through September 30, 2022. Management continually reviews and adjusts its reserve for claims estimates to reflect its loss experience and any new information that becomes available. Adjustments resulting from such reviews could be significant.

7

A summary of the Company’s reserve for claims, broken down into its components of known title claims and IBNR, follows:

(in thousands, except percentages)	September 30, 2022		%	December 31, 2021		%
Known title claims	$	4,033	10.7	$	3,317	9.0
IBNR	33,597		89.3	33,437		91.0
Total reserve for claims	$	37,630	100.0	$	36,754	100.0

Claims and losses paid are charged to the reserve for claims. Although claims losses are typically paid in cash, occasionally claims are settled by purchasing the interest of the insured or the claimant in the real property. When this event occurs, the Company carries assets at the lower of cost or estimated fair value, net of any indebtedness on the property.

Note 3 – Earnings Per Common Share and Share Awards

Basic earnings per common share is computed by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per common share is computed by dividing net income by the combination of dilutive potential common stock, comprised of shares issuable under the Company’s share-based compensation plans, and the weighted average number of common shares outstanding during the reporting period. Dilutive common share equivalents include the dilutive effect of in-the-money share-based awards, which are calculated based on the average share price for each period using the treasury stock method. Under the treasury stock method, when share-based awards are assumed to be exercised, (a) the exercise price of a share-based award and (b) the amount of compensation cost, if any, for future services that the Company has not yet recognized, are assumed to be used to repurchase shares in the current period.

The following table sets forth the computation of basic and diluted earnings per share for the three- and nine-month periods ended September 30:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share amounts)	2022		2021		2022		2021
Net income	$	7,913	$	14,503	$	16,377	$	48,108
Weighted average common shares outstanding – Basic	1,897		1,894		1,897		1,894
Incremental shares outstanding assuming the exercise of dilutive SARs (share-settled)	—		6		1		5
Weighted average common shares outstanding – Diluted	1,897		1,900		1,898		1,899
Basic earnings per common share	$	4.17	$	7.66	$	8.63	$	25.40
Diluted earnings per common share	$	4.17	$	7.63	$	8.63	$	25.34

There were 26 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the three-month periods ended September 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards. There were 13 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the nine-month periods ended September 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards.

The Company historically has adopted employee stock award plans under which restricted stock, options or stock appreciation rights ("SARs") exercisable for the Company's stock may be granted to key employees or directors of the Company. There is currently one active plan from which the Company may grant share-based awards. The awards eligible to be granted under the active plan are limited to SARs, and the maximum aggregate number of shares of common stock of the Company available pursuant to the plan for the grant of SARs is 250 thousand shares. SARs give the holder the right to receive stock equal to the appreciation in the value of shares of stock from the grant date for a specified period of time, and as a result, are accounted for as equity instruments.

As of September 30, 2022, the only outstanding awards under the plans were SARs, which expire within seven years or less from the date of grant. All outstanding SARs vest and are exercisable within five years or less from the date of grant, and all SARs issued to date have been share-settled only. There have been no stock options or SARs granted where the exercise price was less than the market price on the date of grant.

8

A summary of share-based award transactions for all share-based award plans follows:

(in thousands, except weighted average exercise price and average remaining contractual term)	Number Of Shares	Weighted Average Exercise Price		Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2021	36	$	139.16	4.38	$	903
SARs granted	5	184.26
SARs exercised	(6)	106.71
Outstanding as of December 31, 2021	35	$	150.36	3.96	$	1,643
SARs granted	10	155.16
SARs exercised	(4)	89.23
Outstanding as of September 30, 2022	41	$	157.51	4.29	$	219
Exercisable as of September 30, 2022	28	$	162.15	3.53	$	210
Unvested as of September 30, 2022	13	$	147.24	5.96	$	9

During the second quarters of both 2022 and 2021, the Company issued 5 thousand share-settled SARs to directors of the Company. During the third quarter of 2022, the Company also issued 5 thousand share-settled SARs to employees of the Company. There were no such third quarter issuances in 2021. The fair value of each award is estimated on the date of grant using the Black-Scholes option valuation model. Expected volatilities are based on both the implied and historical volatility of the Company’s stock. The Company uses historical data to project SAR exercises and pre-exercise forfeitures within the valuation model. The expected term of awards represents the period of time that SARs granted are expected to be outstanding. The interest rate assumed for the expected life of the award is based on the U.S. Treasury yield curve in effect at the time of the grant. The weighted average fair value for the SARs issued during 2022 and 2021 were $62.60 and $59.83, respectively, and were estimated using the weighted average assumptions shown in the table below:

	2022	2021
Expected Life in Years	7.0	7.0
Volatility	35.6%	33.9%
Interest Rate	3.2%	1.3%
Yield Rate	0.6%	1.1%

There was approximately $259 thousand and $206 thousand of compensation expense relating to SARs vesting on or before September 30, 2022 and 2021, respectively, included in personnel expenses in the unaudited Consolidated Statements of Operations. As of September 30, 2022, there was $644 thousand of unrecognized compensation expense related to unvested share-based compensation arrangements granted under the Company’s stock award plans.

Note 4 – Segment Information

The Company has one reportable segment, title insurance services. The remaining immaterial segments have been combined into a group called “All Other.”

The title insurance segment primarily issues title insurance policies through approved attorneys from underwriting offices and through independent issuing agents. Title insurance policies insure titles to real estate.

9

Provided below is selected financial information about the Company's operations by segment for the periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	78,812	$	4,102	$	(6,164)	$	76,750
Investment loss	(982)		(251)		—		(1,233)
Net realized gain on investments	1,582		899		—		2,481
Total revenues	$	79,412	$	4,750	$	(6,164)	$	77,998
Operating expenses	71,516		2,406		(6,012)		67,910
Income before income taxes	$	7,896	$	2,344	$	(152)	$	10,088
Total assets	$	250,116	$	82,687	$	—	$	332,803

Three Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	79,704	$	2,776	$	(3,609)	$	78,871
Investment income	1,762		515		—		2,277
Net realized gain on investments	235		33		—		268
Total revenues	$	81,701	$	3,324	$	(3,609)	$	81,416
Operating expenses	64,022		2,414		(3,457)		62,979
Income before income taxes	$	17,679	$	910	$	(152)	$	18,437
Total assets	$	256,588	$	78,842	$	—	$	335,430

Nine Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	235,355	$	10,081	$	(18,753)	$	226,683
Investment loss	(12,154)		(2,897)		—		(15,051)
Net realized gain on investments	4,093		2,173		—		6,266
Total revenues	$	227,294	$	9,357	$	(18,753)	$	217,898
Operating expenses	206,938		8,424		(18,298)		197,064
Income before income taxes	$	20,356	$	933	$	(455)	$	20,834
Total assets	$	250,116	$	82,687	$	—	$	332,803

Nine Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	220,824	$	11,769	$	(9,592)	$	223,001
Investment income	12,662		2,021		—		14,683
Net realized gain on investments	628		143		—		771
Total revenues	$	234,114	$	13,933	$	(9,592)	$	238,455
Operating expenses	179,073		7,485		(9,143)		177,415
Income before income taxes	$	55,041	$	6,448	$	(449)	$	61,040
Total assets	$	256,588	$	78,842	$	—	$	335,430

10

Note 5 – Retirement Agreements and Other Postretirement Benefits

The Company’s subsidiary, Investors Title Insurance Company ("ITIC"), is a party to employment agreements with key executives that provide for the continuation of certain employee benefits and other payments due under the agreements upon retirement, estimated to total $14.2 million and $13.4 million as of September 30, 2022 and December 31, 2021, respectively. The executive employee benefits include health, dental, vision and life insurance and are unfunded. These amounts are classified as accounts payable and accrued liabilities in the unaudited Consolidated Balance Sheets. The following sets forth the net periodic benefit cost for the executive benefits for the periods ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Service cost – benefits earned during the year	$	—	$	—	$	—	$	—
Interest cost on the projected benefit obligation	5		8		19		22
Amortization of unrecognized loss	4		—		—		—
Net periodic benefit cost	$	9	$	8	$	19	$	22

Note 6 – Investments and Estimated Fair Value

Investments in Fixed Maturity Securities

The estimated fair value, gross unrealized holding gains, gross unrealized holding losses and amortized cost for fixed maturity securities by major classification are as follows:

As of September 30, 2022 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	13,677	$	—	$	273	$	13,404
Special revenue issuer obligations of U.S. states, territories and political subdivisions	37,939		53		1,099		36,893
Corporate debt securities	4,683		344		17		5,010
Total	$	56,299	$	397	$	1,389	$	55,307

As of December 31, 2021 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	16,669	$	922	$	—	$	17,591
Special revenue issuer obligations of U.S. states, territories and political subdivisions	41,753		2,453		2		44,204
Corporate debt securities	17,089		955		48		17,996
Total	$	75,511	$	4,330	$	50	$	79,791

The special revenue category for both periods presented includes approximately 40 individual fixed maturity securities with revenue sources from a variety of industry sectors.

11

The scheduled maturities of fixed maturity securities at September 30, 2022 are as follows:

	Available-for-Sale
(in thousands)	Amortized Cost		Estimated Fair Value
Due in one year or less	$	9,320	$	9,344
Due one year through five years	35,066		34,635
Due five years through ten years	1,301		1,301
Due after ten years	10,612		10,027
Total	$	56,299	$	55,307

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

The following table presents the gross unrealized losses on fixed maturity securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position at September 30, 2022 and December 31, 2021:

	Less than 12 Months				12 Months or Longer				Total
As of September 30, 2022 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	40,573	$	(1,369)	$	1,100	$	(3)	$	41,673	$	(1,372)
Corporate debt securities	688		(16)		49		(1)		737		(17)
Total temporarily impaired securities	$	41,261	$	(1,385)	$	1,149	$	(4)	$	42,410	$	(1,389)

	Less than 12 Months				12 Months or Longer				Total
As of December 31, 2021 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	—	$	—	$	1,102	$	(2)	$	1,102	$	(2)
Corporate debt securities	8,493		(13)		6,203		(35)		14,696		(48)
Total temporarily impaired securities	$	8,493	$	(13)	$	7,305	$	(37)	$	15,798	$	(50)

Management evaluates available-for-sale fixed maturity securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. The current decline in estimated fair value of the fixed maturity securities can be attributed primarily to changes in market interest rates and changes in credit spreads over Treasury securities.

Factors considered in determining whether a loss is temporary include the length of time and extent to which the estimated fair value has been below cost, the financial condition and prospects of the issuer (including credit ratings and analyst reports) and macro-economic changes. A total of 54 and 9 fixed maturity securities had unrealized losses at September 30, 2022 and December 31, 2021, respectively. The Company does not intend to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date, or repricing date, or if market yields for such investments decline. The Company believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in market interest rates and other market conditions, and therefore the unrealized loss is recorded in accumulated other comprehensive (loss) income.

Reviews of the values of fixed maturity securities are inherently uncertain and the value of the investment may not fully recover, or may decline in future periods, resulting in a realized loss. The Company recorded $162 thousand in other-than-temporary impairment charges related to fixed maturity securities for the nine-month period ended September 30, 2022 and had no recorded other-than-temporary impairment charges for nine-month period ended September 30, 2021. Expenses related to other-than-temporary impairments are recorded in net realized investment gains in the unaudited Consolidated Statements of Operations when recognized.

12

Investments in Equity Securities

The cost and estimated fair value of equity securities are as follows:

As of September 30, 2022 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	28,004	$	52,657
Total	$	28,004	$	52,657

As of December 31, 2021 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	29,478	$	76,853
Total	$	29,478	$	76,853

Unrealized holding gains and losses are reported in the unaudited Consolidated Statements of Operations as changes in the estimated fair value of equity security investments.

Net Realized Investment Gains

Gross realized gains and losses on sales of investments for the nine-month periods ended September 30, 2022 and 2021 are summarized as follows:

(in thousands)	2022		2021
Gross realized gains from securities:
Corporate debt securities	$	—	$	53
Common stocks	7,120		1,428
Total	$	7,120	$	1,481
Gross realized losses from securities:
Corporate debt securities	$	(104)	$	(34)
Common stocks	(209)		(677)
Write-down of securities	(162)		—
Total	$	(475)	$	(711)
Net realized gains from securities	$	6,645	$	770
Gross realized gains (losses) on other investments:
Gains on other investments	$	30	$	1
Losses on other investments	(409)		—
Total	$	(379)	$	1
Net realized investment gains	$	6,266	$	771

Realized gains and losses are determined on the specific identification method.  

13

Variable Interest Entities

The Company holds investments in variable interest entities ("VIEs") that are not consolidated in the Company's financial statements as the Company is not the primary beneficiary. These entities are considered VIEs as the equity investors at risk, including the Company, do not have the power over the activities that most significantly impact the economic performance of the entities; this power resides with a third-party general partner or managing member that cannot be removed except for cause. The following table sets forth details about the Company's variable interest investments in VIEs, which are structured either as limited partnerships ("LPs") or limited liability companies ("LLCs"), as of September 30, 2022:

(in thousands)	Balance Sheet Classification	Carrying Value		Estimated Fair Value		Maximum Potential Loss (a)
Real estate LLCs or LPs	Other investments	$	3,538	$	5,166	$	5,408
Small business investment LPs	Other investments	8,946		9,234		14,320
Total		$	12,484	$	14,400	$	19,728

(a) Maximum potential loss is calculated as the total investment in the LLC or LP, including any capital commitments that may have not yet been called. The Company is not exposed to any loss beyond the total commitment of its investment.

Valuation of Financial Assets

The Financial Accounting Standards Board has established a valuation hierarchy for disclosure of the inputs used to measure estimated fair value of financial assets and liabilities, such as securities. This hierarchy categorizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value.

A financial instrument’s classification within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement – consequently, if there are multiple significant valuation inputs that are categorized in different levels of the hierarchy, the instrument’s hierarchy level is the lowest level (with Level 3 being the lowest level) within which any significant input falls.

The Level 1 category includes equity securities and U.S. Treasury securities that are measured at estimated fair value using quoted active market prices.

The Level 2 category includes fixed maturity securities such as corporate debt securities, U.S. government obligations, and obligations of U.S. states, territories, and political subdivisions. Estimated fair value is principally based on market values obtained from a third-party pricing service. Factors that are used in determining estimated fair market value include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. The Company receives one quote per security from a third-party pricing service, although as discussed below, the Company does consult other pricing resources when confirming that the prices it obtains reflect the fair values of the instruments in accordance with GAAP. Generally, quotes obtained from the pricing service for instruments classified as Level 2 are not adjusted and are not binding. As of September 30, 2022 and December 31, 2021, the Company did not adjust any Level 2 fair values.

A number of the Company’s investment grade corporate debt securities are frequently traded in active markets, and trading prices are consequently available for these securities. However, these securities are classified as Level 2 because the pricing service from which the Company has obtained estimated fair values for these instruments uses valuation models that use observable market inputs in addition to trading prices. Substantially all of the input assumptions used in the service’s model are observable in the marketplace or can be derived or supported by observable market data.

In the measurement of the estimated fair value of certain financial instruments, other valuation techniques were utilized if quoted market prices were not available. These derived fair value estimates are significantly affected by the assumptions used. Additionally, certain financial instruments, including those related to insurance contracts, pension and other postretirement benefits, and equity method investments are excluded from the scope of disclosures.

14

In estimating the fair value of the financial instruments presented, the Company used the following methods and assumptions:

Cash and cash equivalents

The carrying amount for cash and cash equivalents is a reasonable estimate of fair value due to the short-term maturity of these investments.

Measurement alternative equity investments

The measurement alternative method requires investments without readily determinable fair values to be recorded at cost, less impairments, and plus or minus any changes resulting from observable price changes.  The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Accrued interest and dividends

The carrying amount for accrued interest and dividends is a reasonable estimate of fair value due to the short-term maturity of these assets.

The following table presents, by level, fixed maturity securities carried at estimated fair value as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	50,297	$	—	$	50,297
Corporate debt securities	—		5,010		—		5,010
Total	$	—	$	55,307	$	—	$	55,307

As of December 31, 2021 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	61,795	$	—	$	61,795
Corporate debt securities	—		17,996		—		17,996
Total	$	—	$	79,791	$	—	$	79,791

*Denotes fair market value obtained from pricing services.

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	41,380	$	—	$	—	$	41,380
Accrued interest and dividends	971		—		—		971
Equity securities, at fair value:
Common stocks	52,657		—		—		52,657
Short-term investments:
Money market funds and US treasury bills	80,785		—		—		80,785
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,852		8,852
Total	$	175,793	$	—	$	8,852	$	184,645

15

As of December 31, 2021 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	37,168	$	—	$	—	$	37,168
Accrued interest and dividends	817		—		—		817
Equity securities, at fair value:
Common stocks	76,853		—		—		76,853
Short-term investments:
Money market funds	45,930		—		—		45,930
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,688		8,688
Total	$	160,768	$	—	$	8,688	$	169,456

The Company did not hold any Level 3 category debt or marketable equity investment securities as of September 30, 2022 or December 31, 2021.

There were no transfers into or out of Levels 1, 2 or 3 during the periods presented.

To help ensure that estimated fair value determinations are consistent with GAAP, prices from our pricing services go through multiple review processes to ensure appropriate pricing. Pricing procedures and inputs used to price each security include, but are not limited to, the following: unadjusted quoted market prices for identical securities such as stock market closing prices; non-binding quoted prices for identical securities in markets that are not active; interest rates; yield curves observable at commonly quoted intervals; volatility; prepayment speeds; loss severity; credit risks; and default rates. The Company reviews the procedures and inputs used by its pricing services, and verifies a sample of the services’ quotes by comparing them to values obtained from other pricing resources. In the event the Company disagrees with a price provided by its pricing services, the respective service reevaluates the price to corroborate the market information and then reviews inputs to the evaluation in light of potentially new market data.

Certain equity investments under the measurement alternative are measured at estimated fair value on a non-recurring basis and are reviewed for impairment quarterly. If any such investment is determined to be other-than-temporarily impaired, an impairment charge is recorded against such investment and reflected in the unaudited Consolidated Statements of Operations. There were no impairments of such investments made during the nine-month period ended September 30, 2022 or the twelve-month period ended December 31, 2021. The following table presents a rollforward of equity investments under the measurement alternative as of September 30, 2022 and December 31, 2021:

(in thousands)	Balance, January 1, 2022		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, September 30, 2022
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852
Total	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852

(in thousands)	Balance, January 1, 2021		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, December 31, 2021
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688
Total	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688

16

Note 7 – Commitments and Contingencies

Legal Proceedings – The Company and its subsidiaries are involved in legal proceedings that are incidental to their business. In the Company’s opinion, based on the present status of these proceedings, any potential liability of the Company or its subsidiaries with respect to these legal proceedings is not expected to, in the aggregate, be material to the Company’s consolidated financial condition or operations.

Regulation – The Company’s title insurance and trust subsidiaries are regulated by various federal, state and local governmental agencies and are subject to various audits and inquiries. It is the opinion of management based on its present expectations that these audits and inquiries will not have a material impact on the Company’s consolidated financial condition or operations.

Escrow and Trust Deposits – As a service to its customers, the Company, through ITIC, administers escrow and trust deposits representing earnest money received under real estate contracts, escrowed funds received under escrow agreements, undisbursed amounts received for settlement of mortgage loans and indemnities against specific title risks. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of these deposits.

Like-Kind Exchanges Proceeds – In administering tax-deferred like-kind exchanges pursuant to § 1031 of the Internal Revenue Code, the Company’s wholly owned subsidiary, Investors Title Exchange Corporation (“ITEC”), serves as a qualified intermediary, holding the net sales proceeds from relinquished property to be used for purchase of replacement property. Another wholly owned subsidiary, Investors Title Accommodation Corporation (“ITAC”), serves as exchange accommodation titleholder and, through LLCs that are wholly owned subsidiaries of ITAC, holds property for exchangers in reverse exchange transactions. Like-kind exchange deposits and reverse exchange property totaled approximately $477.9 million and $763.9 million as of September 30, 2022 and December 31, 2021, respectively. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate. Exchange services revenue includes earnings on these deposits; therefore, investment income is shown as other income rather than investment income. These like-kind exchange funds are primarily invested in money market funds and other short-term investments.

COVID-19 – COVID-19 could continue to affect the Company in a number of ways including, but not limited to, the impact of employees becoming ill, quarantined, or otherwise unable to work or travel due to illness or governmental restriction, potential decreases in net premiums written in the future, and future fluctuations in the Company's investment portfolio.

Note 8 – Related Party Transactions

The Company does business with, and has investments in, unconsolidated LLCs that are primarily title insurance agencies. The Company utilizes the equity method to account for its investment in these LLCs. The following table sets forth the approximate values by year found within each financial statement classification:

Financial Statement Classification, Consolidated Balance Sheets (unaudited) (in thousands)	As of September 30, 2022		As of December 31, 2021
Other investments	$	5,787	$	6,623
Premium and fees receivable	$	833	$	882

Financial Statement Classification, Consolidated Statements of Operations (unaudited) (in thousands)	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net premiums written	$	6,935	$	7,649	$	20,921	$	21,583
Non-title services and other investment income	$	1,237	$	1,318	$	3,493	$	3,148
Commissions to agents	$	4,969	$	5,507	$	14,501	$	14,770

17

Note 9 – Intangible Assets, Goodwill and Title Plants

The Company evaluates nonorganic growth opportunities, such as acquisitions of title insurance agencies, from time to time in the ordinary course of business. During the nine-month period ended September 30, 2022, a subsidiary of the Company acquired a title insurance agency, now wholly owned, doing business in the state of Texas.

Intangible Assets

The estimated fair values of intangible assets recognized as the result of title insurance agency acquisitions, all Level 3 inputs, are principally based on values obtained from an independent third-party valuation service. In accordance with ASC 350, Intangibles – Goodwill and Other, management determined that no events or changes in circumstances occurred during the nine-month periods ended September 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that no identifiable intangible assets were impaired.

Identifiable intangible assets consist of the following:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Referral relationships	$	8,898	$	8,567
Non-compete agreements	3,155		2,938
Tradename	747		747
Total	12,800		12,252
Accumulated amortization	(4,486)		(3,505)
Identifiable intangible assets, net	$	8,314	$	8,747

The following table provides the estimated aggregate amortization expense for each of the five succeeding fiscal years:

Year Ended (in thousands)
2022	$	328
2023	1,345
2024	1,162
2025	1,079
2026	1,079
Thereafter	3,134
Total	$	8,127

Goodwill and Title Plants

As of September 30, 2022, the Company recognized $9.6 million in goodwill and $1.4 million in title plants, net of impairments, as the result of title insurance agency acquisitions.  The title plants are included with other assets in the unaudited Consolidated Balance Sheets. The fair values of goodwill and the title plants as of the date of acquisition, both Level 3 inputs, were principally based on values obtained from an independent third-party valuation service. In accordance with ASC 350, management determined that no events or changes in circumstances occurred during the nine-month periods ended September 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and, therefore, determined that there were no goodwill or title plant impairments.

18

Note 10 – Accumulated Other Comprehensive (Loss) Income

The following table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	397	$	23	$	420
Other comprehensive (loss) income before calculations	(1,257)		13		(1,244)
Amounts reclassified from accumulated other comprehensive (loss) income	73		—		73
Net current-period other comprehensive (loss) income	(1,184)		13		(1,171)
Ending balance	$	(787)	$	36	$	(751)

Three Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	3,949	$	(144)	$	3,805
Other comprehensive (loss) income before calculations	(342)		—		(342)
Amounts reclassified from accumulated other comprehensive (loss) income	9		—		9
Net current-period other comprehensive (loss) income	(333)		—		(333)
Ending balance	$	3,616	$	(144)	$	3,472

Nine Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	3,370	$	(144)	$	3,226
Other comprehensive (loss) income before calculations	(4,364)		180		(4,184)
Amounts reclassified from accumulated other comprehensive (loss) income	207		—		207
Net current-period other comprehensive (loss) income	(4,157)		180		(3,977)
Ending balance	$	(787)	$	36	$	(751)

Nine Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	4,470	$	(144)	$	4,326
Other comprehensive (loss) income before calculations	(839)		—		(839)
Amounts reclassified from accumulated other comprehensive (loss) income	(15)		—		(15)
Net current-period other comprehensive (loss) income	(854)		—		(854)
Ending balance	$	3,616	$	(144)	$	3,472

19

The following table provides significant amounts reclassified out of each component of accumulated other comprehensive (loss) income for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(58)
Write-down of securities	(35)
Total	$	(93)	Net realized investment gains
Tax	20		Provision for income taxes
Net of Tax	$	(73)
Reclassifications for the period	$	(73)

Three Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(11)
Write-down of securities	—
Total	$	(11)	Net realized investment gains
Tax	2		Provision for income taxes
Net of Tax	$	(9)
Reclassifications for the period	$	(9)

Nine Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(104)
Write-down of securities	(162)
Total	$	(266)	Net realized investment gains
Tax	59		Provision for income taxes
Net of Tax	$	(207)
Reclassifications for the period	$	(207)

20

Nine Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments	$	19
Write-down of securities	—
Total	$	19	Net realized investment gains
Tax	(4)		Provision for income taxes
Net of Tax	$	15
Reclassifications for the period	$	15

Note 11 – Revenue from Contracts with Customers

GAAP requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance does not apply to revenue associated with insurance contracts (including title insurance policies), financial instruments and lease contracts, and therefore is primarily applicable to the following Company revenue categories.

Escrow and other title-related fees: The Company’s title segment recognizes commission revenue and fees related to items such as searches, settlements, commitments and other ancillary services. Escrow and other title-related fees are recognized as revenue at the time of the related transactions as the earnings process, or performance obligation, is then considered to be complete.

Non-title services: Through various subsidiaries, the Company offers management services, tax-deferred real property exchange services, investment management and trust services. Nonrefundable exchange fees are recognized as revenue upon receipt of the funds, which is at the time of closing of the initial sale of property. All other non-title service fees are recognized as revenue as performance obligations are completed.

Other: The Company occasionally recognizes revenue from other miscellaneous contracts which can include, but is not limited to, seminar and education registration fees and software licensing contracts. These revenue streams are deemed immaterial to the operations of the Company, and revenue is recognized when, or as, performance obligations are completed.

The following table provides a breakdown of the Company’s revenue by major business activity:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Revenue from contracts with customers:
Escrow and other title-related fees	$	5,963	$	3,863	$	17,236	$	10,148
Non-title services	3,852		2,446		9,114		6,932
Total revenue from contracts with customers	9,815		6,309		26,350		17,080
Other sources of revenue:
Net premiums written	66,658		72,345		199,409		201,349
Investment-related revenue (loss)	1,248		2,545		(8,785)		15,454
Other	277		217		924		4,572
Total revenues	$	77,998	$	81,416	$	217,898	$	238,455

21

Note 12 – Leases

The Company enters into lease agreements that are primarily used for office space. These leases are accounted for as operating leases, with lease expense recognized on a straight-line basis over the term of the lease.

A portion of the Company's current leases include an option to extend or cancel the lease term. The exercise of such an option is solely at the Company's discretion. The operating lease liability recorded in the unaudited Consolidated Balance Sheets includes lease payments related to options to extend or cancel the lease term if the Company determined at the date of adoption that the lease was expected to be renewed or extended. The Company, in determining the present value of lease payments, utilized the average rate over a 10-year term based upon the Moody's seasoned Aaa corporate bond yields, as explicit rates of interest were not readily determinable in the lease contracts. The Company does not carry debt; thus no incremental borrowing rate was available to the Company.

Lease expense is included in office and technology expenses in the unaudited Consolidated Statements of Operations. Information regarding the Company’s operating leases follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Operating leases	$	697	$	350	$	1,876	$	1,002
Short-term leases (b)	64		93		177		249
Lease expense	$	761	$	443	$	2,053	$	1,251
Sub-lease income	—		—		—		—
Lease cost	$	761	$	443	$	2,053	$	1,251

(b) Leases with an initial term of twelve months or less are not recorded on the unaudited Consolidated Balance Sheets.

Components of the operating lease liability presented on the unaudited Consolidated Balance Sheets are as follows:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Current:
Operating lease liabilities	$	2,083	$	1,547
Non-current:
Operating lease liabilities	4,306		3,782
Total operating lease liabilities	$	6,389	$	5,329

The future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of September 30, 2022, are summarized as follows:

Year Ended (in thousands)
2022	$	544
2023	2,168
2024	1,729
2025	1,194
2026	893
Thereafter	316
Total undiscounted payments	$	6,844
Less: present value adjustment	(455)
Operating lease liabilities	$	6,389

22

Supplemental lease information is as follows:

	As of September 30, 2022		As of December 31, 2021
Weighted average remaining lease term (years)	3.62		4.13
Weighted average discount rate	3.9	%	4.2	%

The Company does not have any material pending operating or financing lease agreements that become effective in future periods.

23

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations

Investors Title Company's (the "Company") Annual Report on Form 10-K for the year ended December 31, 2021 (the "2021 Form 10-K") as filed with the Securities and Exchange Commission (the "SEC") should be read in conjunction with the following discussion since it contains information which is important for evaluating the Company's operating results and financial condition.

In addition, the Company may make forward-looking statements in the following discussion and analysis. Forward looking statements are based on certain assumptions and expectations of future events that are subject to a number of risks and uncertainties. Actual results may vary. See "Safe Harbor for Forward-Looking Statements" at the end of this discussion and analysis, as well as the sections titled "Risk Factors" in Part I, Item 1A of the 2021 Form 10-K for factors that could affect forward-looking statements.

Overview

The Company is a holding company that engages primarily in issuing title insurance through two subsidiaries, Investors Title Insurance Company (“ITIC”) and National Investors Title Insurance Company (“NITIC”). Through ITIC and NITIC, the Company underwrites land title insurance for owners and mortgagees as a primary insurer. Total revenues from the title segment accounted for 96.1% of the Company's revenues for the nine-month period ended September 30, 2022.

Title insurance protects against loss or damage resulting from title defects that affect real property. When real property is conveyed from one party to another, occasionally there is an undisclosed defect in the title or a mistake or omission in a prior deed, will or mortgage that may give a third party a legal claim against such property.  If a covered claim is made against real property, title insurance provides indemnification against insured defects.

There are two basic types of title insurance policies – one for the mortgage lender and one for the real property owner.  A lender often requires the property owner to purchase a lender’s title insurance policy to protect its position as a holder of a mortgage loan, but the lender’s title insurance policy does not protect the property owner.  The property owner has to purchase a separate owner’s title insurance policy to protect its investment.

The Company issues title insurance policies directly and through a network of agents.  Issuing agents are typically real estate attorneys, independent agents or subsidiaries of community and regional mortgage lending institutions, depending on local customs and regulations and the Company’s marketing strategy in a particular territory.  The ability to attract and retain issuing agents is a key determinant of the Company’s growth in title insurance premiums written.

Revenues for the title insurance segment primarily result from purchases of new and existing residential and commercial real estate, refinance activity and certain other types of mortgage lending such as home equity lines of credit.

Title insurance premiums vary from state to state and are subject to extensive regulation. Statutes generally provide that rates must not be excessive, inadequate or unfairly discriminatory. The process of implementing a rate change in most states involves pre-approval by the applicable state insurance regulator.

Volume is a factor in the Company’s profitability due to fixed operating costs that are incurred by the Company regardless of title insurance premium volume.  The resulting operating leverage tends to amplify the impact of changes in volume on the Company’s profitability.  The Company’s profitability also depends, in part, upon its ability to manage its investment portfolio to maximize investment returns and to minimize risks such as interest rate changes, defaults and impairments of assets.

The Company’s volume of title insurance premiums is affected by the overall level of residential and commercial real estate activity, which includes property sales, mortgage financing and mortgage refinancing.  Real estate activity, home sales and mortgage lending are cyclical in nature. Real estate activity is affected by a number of factors, including the availability of mortgage credit, the cost of real estate, consumer confidence, employment and family income levels, and general United States economic conditions.  Interest rate volatility is also an important factor in the level of residential and commercial real estate activity.

The Company’s title insurance premiums in future periods are likely to fluctuate due to these and other factors which are beyond management’s control.

Historically, the title insurance business tends to be seasonal as well as cyclical. Because home sales are typically strongest in periods of favorable weather, the first calendar quarter tends to have the lowest activity levels, while the spring and summer quarters tend to be more active. Mortgage refinance activity tends to be influenced less by seasonality and more by economic cycles, with activity levels increasing during times of falling interest rates.

24

Services other than title insurance provided by operating divisions of the Company are not reported separately, but rather are reported collectively in a group called “All Other.”  These other services include those offered by the Company and by its wholly owned subsidiaries, Investors Title Exchange Corporation (“ITEC”), Investors Title Accommodation Corporation (“ITAC”), Investors Trust Company (“Investors Trust”) and Investors Title Management Services, Inc. (“ITMS”).

The Company’s exchange services division, consisting of the operations of ITEC and ITAC, provides customer services in connection with tax-deferred real property exchanges. ITEC acts as a qualified intermediary in tax-deferred exchanges of property held for productive use in a trade or business or for investment, and its income is derived from fees for handling exchange transactions and interest earned on client deposits held by the Company. In its role as qualified intermediary, ITEC coordinates the exchange aspects of the real estate transaction, and its duties include drafting standard exchange documents, holding the exchange funds between the time the old property is sold and the new property is purchased, and accepting the formal identification of the replacement property within the required identification period. ITAC provides services as an exchange accommodation titleholder for accomplishing “parking transactions” as set forth in the safe harbor contained in Internal Revenue Procedure 2000-37.  These transactions include reverse exchanges when taxpayers decide to acquire replacement property before selling the relinquished property, or “build to suit” exchanges, when improvements must be made to the replacement property before the taxpayer acquires the improved replacement property. The services provided by the Company’s exchange services division, ITEC and ITAC, are pursuant to provisions in the Internal Revenue Code. From time to time, these laws are subject to review and changes, which may negatively affect the demand for tax-deferred exchanges in general, and consequently, the revenues and profitability of the Company’s exchange services division.

The Company’s trust services division, Investors Trust, provides investment management and trust services to individuals, companies, banks and trusts.

ITMS offers various consulting and management services to provide clients with the technical expertise to start and successfully operate a title insurance agency.

Business Trends and Recent Conditions

The housing market is heavily influenced by government policies and overall economic conditions. Regulatory reform and initiatives by various governmental agencies, including the Federal Reserve's monetary policy and other regulatory changes, could impact lending standards or the processes and procedures used by the Company. The current real estate environment, including interest rates and general economic activity, typically influence the demand for real estate. Changes in either of these areas, in addition to ongoing supply constraints and volatility in the cost and availability of building materials, could impact the Company's results of operations in future periods.

COVID-19 – COVID-19 could continue to affect the Company in a number of ways including, but not limited to, the impact of employees becoming ill, quarantined, or otherwise unable to work or travel due to illness or governmental restriction, potential decreases in net premiums written in the future, and future fluctuations in the Company's investment portfolio.

The current period of inflation, as well as ongoing military conflict between Russia and Ukraine, has created additional volatile market conditions and uncertainties in the global economy. These events have impacted and could continue to impact the Company in a number of ways including, but not limited to, future fluctuations in the Company's investment portfolio and potential decreases in net premiums written. The Federal Open Market Committee (“FOMC”) of the Federal Reserve has been highly attentive to the risks that these events have created, and in response has been raising the target federal funds rate at recent meetings. Although the federal funds rate does not directly impact mortgage interest rates, it can have a significant influence as lenders pass on the costs of rate increases to consumers. Higher mortgage interest rates could impact the demand and pricing of real estate.

Regulatory Environment

The FOMC issues disclosures on a periodic basis that include projections of the federal funds rate and expected actions. In March 2020, the FOMC lowered the target federal funds rate twice by a total of 150 basis points in response to risk posed to economic activity by COVID-19, resulting in a target federal funds rate range between 0.00% and 0.25%. The FOMC had maintained this target range until March 2022, when the target federal funds rate range was increased to between 0.25% and 0.50%. The target federal funds rate range was further raised at subsequent meetings, with the FOMC's most recent change increasing the target range in November 2022 to between 3.75% and 4.00%. The FOMC has noted that it anticipates that ongoing increases in the target range will be appropriate and, in addition, has decided to continue with balance sheet holdings reductions that began in May of 2022. In normal economic situations, future adjustments to the FOMC’s stance of monetary policy are expected to be based on realized and expected economic developments to achieve maximum employment and inflation near the FOMC's symmetric long-term 2.0% objective.

25

In 2008, the federal government took control of the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) in an effort to keep these government-sponsored entities from failing. The primary functions of Fannie Mae and Freddie Mac are to provide liquidity to the nation's mortgage finance system by purchasing mortgages on the secondary market, pooling them and selling them as mortgage-backed securities. In order to securitize, Fannie Mae and Freddie Mac typically require the purchase of title insurance for loans they acquire. Since the federal takeover, there have been various discussions and proposals regarding their reform. Changes to these entities could impact the entire mortgage loan process and, as a result, could affect the demand for title insurance. The timing and results of reform are currently unknown; however, any changes to these entities could affect the Company and its results of operations.

In recent years, the Consumer Financial Protection Bureau (“CFPB”), Office of the Comptroller of Currency and the Federal Reserve have issued memorandums to banks that communicated those agencies’ heightened focus on vetting third-party providers. Such increased regulatory involvement may affect the Company's agents and approved providers. Further proposals to change regulations governing insurance holding companies and the title insurance industry are often introduced in Congress, in state legislatures and before various insurance regulatory agencies. Although the Company regularly monitors such proposals, the likelihood and timing of passage of any such regulation, and the possible effects of any such regulation on the Company and its subsidiaries, cannot be determined at this time.

The timing and nature of any reforms are currently unknown; however, the CFPB has taken a significantly more aggressive approach to using its rulemaking, supervision, and enforcement authorities under President Biden’s administration. Any changes to the CFPB or other governmental entities could affect the Company and its results of operations.

Real Estate Environment

The Mortgage Bankers Association's ("MBA") September 19, 2022 Mortgage Finance Forecast (“MBA Forecast”) projects 2022 purchase activity to decrease 13.2% to $1,618 billion and mortgage refinance activity to decrease 72.6% to $706 billion, resulting in a net decrease in total mortgage originations of 47.6% to $2,324 billion, all from 2021 levels. In 2021, purchase activity accounted for 42.0% of all mortgage originations and is projected in the MBA Forecast to represent 69.6% of all mortgage originations in 2022. According to data published by Freddie Mac, the average 30-year fixed mortgage interest rates in the United States were 4.9% and 2.9% for the nine-month periods ended September 30, 2022 and 2021, respectively. The FOMC has noted that it anticipates that ongoing increases in the federal funds rate will be appropriate in response to the current inflationary environment, with mortgage rates typically moving in conjunction with the federal funds rate. Per the MBA Forecast, mortgage interest rates are projected to stay at or around 5.5% for the remainder of 2022, before decreasing in both 2023 and 2024. Due to the rapidly changing environment brought on by COVID-19, supply constraints, inflationary pressures and geopolitical conflicts, these projections and the impact of actual future developments on the Company could be subject to material change.

Historically, activity in real estate markets has varied over the course of market cycles by geographic region and in response to evolving economic factors. Operating results can vary from year to year based on cyclical market conditions and do not necessarily indicate the Company's future operating results and cash flows.

Critical Accounting Estimates and Policies

The preparation of the Company's unaudited Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of certain assets, liabilities, revenues, expenses and related disclosures regarding contingencies and commitments. Actual results could differ from these estimates. During the nine-month period ended September 30, 2022, the Company did not make any material changes to its critical accounting policies as previously disclosed in Management's Discussion and Analysis in the 2021 Form 10-K.

26

Results of Operations

The following table presents certain unaudited Consolidated Statements of Operations data for the three- and nine-month periods ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Revenues:
Net premiums written	$	66,658	$	72,345	$	199,409	$	201,349
Escrow and other title-related fees	5,963		3,863		17,236		10,148
Non-title services	3,852		2,446		9,114		6,932
Interest and dividends	1,229		893		3,055		2,807
Other investment income	2,173		2,186		4,616		4,610
Net realized investment gains	2,481		268		6,266		771
Changes in the estimated fair value of equity security investments	(4,635)		(802)		(22,722)		7,266
Other	277		217		924		4,572
Total Revenues	77,998		81,416		217,898		238,455
Operating Expenses:
Commissions to agents	33,478		37,570		97,161		102,458
Provision for claims	1,966		1,993		3,452		5,020
Personnel expenses	21,586		15,457		63,738		47,524
Office and technology expenses	4,274		3,175		12,930		9,128
Other expenses	6,606		4,784		19,783		13,285
Total Operating Expenses	67,910		62,979		197,064		177,415
Income before Income Taxes	10,088		18,437		20,834		61,040
Provision for Income Taxes	2,175		3,934		4,457		12,932
Net Income	$	7,913	$	14,503	$	16,377	$	48,108

27

Insurance Revenues

Insurance revenues include net premiums written and escrow and other title-related income that includes escrow fees, commissions and settlement fees. Non-title services revenue, investment-related revenues and other revenues are discussed separately below.

Net Premiums Written

Net premiums written decreased 7.9% and 1.0% for the three- and nine-month periods ended September 30, 2022 to $66.7 million and $199.4 million, respectively, compared with $72.3 million and $201.3 million for the same prior year periods. The decreases for the three- and nine-month periods ended September 30, 2022 were primarily driven by an overall decline in the level of real estate transaction volume following the rise in mortgage interest rates, partially offset by higher average home prices and increased premiums in our Texas market.

Total premiums include an estimate of premiums for policies that have been issued directly and by agents, but not reported to the Company as of the balance sheet date. To determine the estimated premiums, the Company uses historical experience, as well as other factors, to make certain assumptions about the average elapsed time between the policy effective date and the date the policies are reported. From time to time, the Company adjusts the inputs to the estimation process as reported transactions and new information becomes available from direct and agency business. In addition to estimating revenues, the Company also estimates and accrues agent commissions, claims provision, premium taxes, income taxes, and other expenses associated with the estimated revenues that have been accrued. The Company reflects any adjustments to the accruals in the results of operations in the period in which new information becomes available.

Title insurance companies typically issue title insurance policies directly or through title agencies. Following is a breakdown of premiums generated by direct and agency operations for the three- and nine-month periods ended September 30, 2022 and 2021, with certain balances for 2021 reclassified to conform to the 2022 presentation:

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except percentages)	2022		%	2021		%	2022		%	2021		%
Direct	$	21,818	32.7	$	21,803	30.1	$	68,478	34.3	$	61,619	30.6
Agency	44,840		67.3	50,542		69.9	130,931		65.7	139,730		69.4
Total	$	66,658	100.0	$	72,345	100.0	$	199,409	100.0	$	201,349	100.0

Direct Net Premiums – The Company's direct business consists of operations at the home office, branch offices, and wholly owned title insurance agencies. In the Company's direct operations, the Company issues a title insurance policy and retains the entire premium, as no commissions are recognized in connection with these policies. Net premiums written from direct operations increased 0.1% and 11.1% for the three- and nine-month periods ended September 30, 2022, respectively, compared with the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 and 2021 were driven by higher average home prices and increased premiums written by wholly owned agencies in our Texas market, partially offset by a decline in transaction volume associated with higher mortgage interest rates.

Agency Net Premiums – When a policy is written through a non-wholly owned title agency, the premium is shared between the agency and the underwriter. The agent retains a majority of the premium as a commission and remits the net amount to the Company. Title insurance commissions earned by the Company’s agents are recognized as expenses concurrently with premium recognition. Agency net premiums written decreased 11.3% and 6.3% for the three- and nine-month periods ended September 30, 2022, compared with the same prior year periods. The decreases for the three- and nine-month periods ended September 30, 2022 were primarily driven by an overall decline in the level of real estate transaction volume following the rise in mortgage interest rates, partially offset by higher average home prices.

28

Following is a schedule of net premiums written for the three- and nine-month periods ended September 30, 2022 and 2021 in select states in which the Company's two insurance subsidiaries, ITIC and NITIC, currently underwrite title insurance:

	Three Months Ended September 30,				Nine Months Ended September 30,
State (in thousands)	2022		2021		2022		2021
North Carolina	$	23,622	$	26,118	$	71,392	$	75,527
Texas	21,081		18,079		60,457		42,317
Georgia	6,094		7,667		18,819		25,527
South Carolina	6,407		7,258		17,349		17,940
All Others	9,632		13,352		32,068		40,413
Premiums Written	66,836		72,474		200,085		201,724
Reinsurance Assumed	—		—		—		—
Reinsurance Ceded	(178)		(129)		(676)		(375)
Net Premiums Written	$	66,658	$	72,345	$	199,409	$	201,349

The increases in net premiums written in the state of Texas for the three- and nine-month periods ended September 30, 2022 primarily resulted from the Company's recent acquisitions of title insurance agencies doing business in the state of Texas. The Company evaluates nonorganic growth opportunities, such as acquisitions of title insurance agencies, from time to time in the ordinary course of business.

Escrow and Other Title-Related Fees

Escrow and other title-related fees consists primarily of commission income, escrow and other various fees associated with the issuance of title insurance policies including settlement, examination and closing fees. Escrow and other title-related fee revenues were $6.0 million and $17.2 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $3.9 million and $10.1 million for the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 were mainly due to a larger share of business in markets that generate escrow income, and fee income associated with commercial activity.

Revenue from Non-Title Services

Revenue from non-title services includes trust services, agency management services and exchange services income. Non-title service revenues were $3.9 million and $9.1 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $2.4 million and $6.9 million for the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 were primarily related to increases in like-kind exchange revenues.

Investment-Related Revenues

Investment-related revenues include interest and dividends, other investment income, net realized investment gains and changes in the estimated fair value of equity security investments.

Interest and Dividends

The Company derives a substantial portion of its income from investments in fixed maturity securities, which are primarily municipal and corporate fixed maturity securities, and equity securities. The Company’s investment policy is designed to comply with regulatory requirements and to balance the competing objectives of asset quality and investment returns. The Company's title insurance subsidiaries are required by statute to maintain minimum levels of investments in order to protect the interests of policyholders.

The Company’s investment strategy emphasizes after-tax income and principal preservation.  The Company’s investments are primarily in fixed maturity securities and equity securities.  The average effective maturity of the majority of the fixed maturity securities is less than 10 years.  The Company’s invested assets are managed to fund its obligations and evaluated to ensure long term stability of capital accounts.

29

As the Company generates cash from operations, it is invested in accordance with the Company’s investment policy and corporate goals.  The Company’s investment policy has been designed to balance multiple goals, including the assurance of a stable source of income from interest and dividends, the preservation of principal, and the provision of liquidity sufficient to meet insurance underwriting and other obligations as they become payable in the future.  Securities purchased may include a combination of taxable or tax-exempt fixed maturity securities and equity securities.  The Company also invests in short-term investments that typically include money market funds, and, at times, the Company has or could invest in U.S. Treasury bills, commercial paper and certificates of deposit. The Company strives to maintain a high quality investment portfolio. In 2022, the Company has purchased higher levels of short-term investments due to the downturns in other investment vehicles utilized by the Company and uncertainty in the investment market.

Interest and dividends were $1.2 million and $3.1 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $893 thousand and $2.8 million for the same prior year periods.  Interest and investment income levels are primarily a function of general market performance, interest rates and the amount of cash available for investments that meet the Company's investment policy.

Other Investment Income

Other investment income consists primarily of income related to investments in unconsolidated affiliates, typically structured as limited liability companies ("LLCs"), accounted for under either the equity method of accounting or the measurement alternative for investments that do not have readily determinable fair values. The measurement alternative method requires investments without readily determinable fair values to be recorded at cost, less impairments, and plus or minus any changes resulting from observable price changes. The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Other investment income was $2.2 million and $4.6 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $2.2 million and $4.6 million for the same prior year periods. Changes in other investment income are impacted by fluctuations in the carrying value of the underlying investment and/or distributions received.

Net Realized Investment Gains

Dispositions of equity securities at a realized gain or loss reflect such factors as industry sector allocation decisions, ongoing assessments of issuers’ business prospects and tax planning considerations.  Additionally, the amounts included in net realized investment gains are affected by assessments of securities’ valuation for impairment.  As a result of the interaction of these factors and considerations, the net realized investment gain or loss can vary significantly from period to period.

The net realized investment gains were $2.5 million and $6.3 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $268 thousand and $771 thousand for the same prior year periods. The Company recorded impairment charges of $35 thousand and $162 thousand on certain fixed maturity securities where the intent to hold has changed in the three- and nine-month periods ended September 30, 2022. There were no impairment charges recorded in 2021. Management believes unrealized losses on the remaining fixed maturity securities at September 30, 2022 are temporary in nature.

The securities in the Company’s investment portfolio are subject to economic conditions and market risks.  The Company considers relevant facts and circumstances in evaluating whether a credit or interest-related impairment of a fixed maturity security has occurred.  Relevant facts and circumstances include the extent and length of time the fair value of an investment has been below cost.

There are a number of risks and uncertainties inherent in the process of monitoring impairments and determining if an impairment is other-than-temporary. These risks and uncertainties include the risk that the economic outlook will be worse than expected or have more of an impact on the issuer than anticipated; the risk that the Company’s assessment of an issuer’s ability to meet all of its contractual obligations will change based on changes in the characteristics of that issuer; the risk that information obtained by the Company or changes in other facts and circumstances leads management to change its intent to sell the fixed maturity security; and the risk that management is making decisions based on inaccurate information.

Changes in the Estimated Fair Value of Equity Security Investments

Changes in the estimated fair value of equity security investments were $(4.6) million and $(22.7) million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $(802) thousand and $7.3 million for the same prior year periods. Such fluctuations are the result of changes in general market conditions during the respective periods. All major indices have experienced significant declines in 2022.

30

Other Revenues

Other revenues primarily include miscellaneous income and gains and losses on the disposal of fixed assets and real estate. Other revenues were $277 thousand and $924 thousand for the three- and nine-month periods ended September 30, 2022, respectively, compared with $217 thousand and $4.6 million for the same prior year periods. The decrease for the nine-month period ended September 30, 2022 was primarily related to a gain on the sale of a property recorded in 2021.

Expenses

The Company's operating expenses consist primarily of commissions to agents, personnel expenses, office and technology expenses and the provision for claims. Operating expenses increased 7.8% and 11.1% for the three- and nine-month periods ended September 30, 2022, compared with the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 were primarily due to increases in personnel expenses, title fees, and office and technology expenses.

Following is a summary of the Company's operating expenses for the three- and nine-month periods ended September 30, 2022 and 2021. Inter-segment eliminations have been netted; therefore, the individual segment amounts will not agree to Note 4 to the unaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

	Three Months Ended September 30,						Nine Months Ended September 30,
(in thousands, except percentages)	2022		%	2021		%	2022		%	2021		%
Title Insurance	$	65,567	96.5	$	60,599	96.2	$	188,788	95.8	$	170,032	95.8
All Other	2,343		3.5	2,380		3.8	8,276		4.2	7,383		4.2
Total	$	67,910	100.0	$	62,979	100.0	$	197,064	100.0	$	177,415	100.0

On a combined basis, the after-tax profit margins were 10.1% and 7.5% for the three- and nine-month periods ended September 30, 2022, respectively, compared with 17.8% and 20.2% for the same prior year periods. The decreases for the three- and nine-month periods ended September 30, 2022 were primarily due to reductions in the estimated fair value of equity security investments during the current year periods, a gain on the sale of property in the same prior year periods, and increases in total expenses that outpaced the changes in revenue. The Company continually strives to enhance its competitive strengths and market position, including ongoing initiatives to manage its operating expenses.

Total Company

Personnel Expenses – Personnel expenses include base salaries, benefits and payroll taxes, bonuses paid to employees and contract labor expenses. Personnel expenses were $21.6 million and $63.7 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $15.5 million and $47.5 million for the same prior year periods. On a consolidated basis, personnel expenses as a percentage of total revenues were 27.7% and 29.3% for the three- and nine-month periods ended September 30, 2022, respectively, compared with 19.0% and 19.9% for the same prior year periods. The increases in personnel expenses for the three- and nine-month periods ended September 30, 2022 were primarily due to staffing of new offices, hiring to support growth initiatives, and increased employee benefit costs. Increases in staffing levels are the result of both organic growth and recent acquisitions of title insurance agencies, as the Company continues expansion of its geographic footprint. Employee headcount increased by 40.2% as of September 30, 2022, when compared to the same prior year period, primarily due to the Company's continued expansion efforts in the Texas market.

Office and Technology Expenses – Office and technology expenses primarily include facilities expenses, software and hardware expenses, depreciation expense, telecommunications expenses, and business insurance. Office and technology expenses were $4.3 million and $12.9 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $3.2 million and $9.1 million for the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 were primarily in support of expanding the Company's geographic footprint, the result of adding new office locations due to both organic growth and recent acquisitions of title insurance agencies, and various ongoing technology initiatives.

Other Expenses – Other expenses primarily include business development expenses, premium-related taxes and licensing, professional services, title and service fees, amortization of intangible assets and other general expenses. Other expenses were $6.6 million and $19.8 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $4.8 million and $13.3 million for the same prior year periods. The increases for the three- and nine-month periods ended September 30, 2022 were primarily related to increases in title and service fees, technology fees and business development expenses.

31

Title Insurance

Commissions to Agents – Agent commissions represent the portion of premiums retained by agents pursuant to the terms of their respective agency contracts. Commissions to agents decreased 10.9% and 5.2% for the three- and nine-month periods ended September 30, 2022, respectively, compared with the same prior year periods. Commission expense as a percentage of net premiums written by agents was 74.7% and 74.2% for the three- and nine-month periods ended September 30, 2022, compared with 74.3% and 73.3% for the same prior year periods. The changes in commission expense, and commission expense as a percentage of net premiums written, were primarily related to the decreases in agent premium volume and changes in geographic mix. Commission rates vary by market due to local practice, competition and state regulations.

Provision for Claims – The provision for claims decreased 1.4% and 31.2% for the three- and nine-month periods ended September 30, 2022, respectively, compared with the same prior year periods. The provision for claims as a percentage of net premiums written was 2.9% and 1.7% for the three- and nine-month periods ended September 30, 2022, compared with 2.8% and 2.5% for the same prior year periods. The decrease in the provision for claims for the nine-month period ended September 30, 2022 was primarily due to changes in the geographic mix for underwriting risk and higher levels of favorable loss development in 2022.

Title claims are typically reported and paid within the first several years of policy issuance. The provision for claims reflects actual payments of claims, net of recovery amounts, plus adjustments to the specific and incurred but not reported claims reserves, the latter of which are actuarially determined based on historical claims experience. Actual payments of claims, net of recoveries, were $2.6 million and $1.8 million for the nine-month periods ended September 30, 2022 and 2021, respectively.

At September 30, 2022, the total reserve for claims was $37.6 million. Of that total, approximately $4.0 million was reserved for specific claims, and approximately $33.6 million was reserved for claims for which the Company had no notice. Because of the uncertainty of future claims, changes in economic conditions and the fact that claims may not materialize for several years, reserve estimates are subject to variability.

Changes from prior periods in the expected liability for claims reflect the uncertainty of the claims environment, as well as the limited predictive power of historical data. The Company continually updates and refines its reserve estimates as current experience develops and credible data emerges. Such data includes payments on claims closed during the quarter, new details that emerge on open cases that cause claims adjusters to increase or decrease the case reserves, and the impact that these types of changes have on the Company’s total loss provision. Adjustments may be required as new information develops, which often varies from past experience.

Income Taxes

The provision for income taxes was $2.2 million and $4.5 million for the three- and nine-month periods ended September 30, 2022, respectively, compared with $3.9 million and $12.9 million for the same prior year periods. Income tax expense, including federal and state taxes, as a percentage of income before income taxes was 21.6% and 21.4% for the three- and nine-month periods ended September 30, 2022, respectively, compared with 21.3% and 21.2% for the same prior year periods. The effective income tax rates for both 2022 and 2021 differ from the U.S. federal statutory income tax rate of 21% primarily due to the effect of tax-exempt income and state taxes. Tax-exempt income lowers the effective tax rate.

The Company believes it is more likely than not that the tax benefits associated with recognized impairments and unrecognized losses recorded through September 30, 2022 will be realized. However, this judgment could be impacted by further market fluctuations.

32

Liquidity and Capital Resources

The Company’s material cash requirements include general operating expenses, contractual and other obligations for the future payment of title claims, employment agreements, lease agreements, income taxes, capital expenditures, dividends on its common stock and other contractual commitments for goods and services needed for operations. All other arrangements entered into by the Company are not reasonably likely to have a material effect on liquidity or the availability of capital resources. Cash flows from operations have historically been the primary source of financing for expanding operations, whether through organic growth or outside investments. The Company believes its balances of cash, short-term investments and other readily marketable securities, along with cash flows generated by ongoing operations, will be sufficient to satisfy its cash requirements over the next 12 months and thereafter, including the funding of operating activities and commitments for investing and financing activities, in addition to potential purchases under the Company's repurchase plan described below. There are currently no known trends that the Company believes will materially impact the Company’s capital resources, nor is the Company anticipating any material changes in the mix or relative cost of such resources except as otherwise disclosed in the Business Trends and Recent Conditions section of this Management's Discussion and Analysis.

The Company evaluates nonorganic growth opportunities, such as mergers and acquisitions, from time to time in the ordinary course of business. Because of the episodic nature of these events, related incremental liquidity and capital resource needs can be difficult to predict.

The Company’s operating results and cash flows are heavily dependent on the real estate market. The Company’s business has certain fixed costs; therefore, changes in the real estate market are monitored closely, and operating expenses such as staffing levels are managed and adjusted accordingly. The Company believes that its significant working capital position and management of operating expenses will aid its ability to manage cash resources through fluctuations in the real estate market.

Cash Flows – Net cash flows provided by operating activities were $20.3 million and $35.7 million for the nine-month periods ended September 30, 2022 and 2021, respectively. Cash flows provided by operating activities differ from net income due to adjustments for non-cash items, such as changes in the estimated fair value of equity security investments, gains and losses on investments and property, the timing of disbursements for taxes, claims and other accrued liabilities, and collections or changes in receivables and other assets.

Cash flows from non-operating activities have historically consisted of purchases and proceeds from investing activities, the issuance of dividends and repurchases of common stock. Net cash was used in investing activities for the nine-month period ended September 30, 2022, compared with net cash being provided by investing activities in the prior year period, due primarily to an increase in purchases of investments, net of proceeds from investment sales and maturities, the purchase of a subsidiary during the current year period, and a decrease in proceeds from the sale of property.

The Company maintains a high degree of liquidity within its investment portfolio in the form of cash, short-term investments and other readily marketable securities. As of September 30, 2022, the Company held cash and cash equivalents of $41.4 million, short-term investments of $80.8 million, available-for-sale fixed maturity securities of $55.3 million and equity securities of $52.7 million. The net effect of all activities on total cash and cash equivalents was an increase of $4.2 million in 2022.

Capital Resources – The amount of capital resources the Company maintains is influenced by state regulation, the need to maintain superior financial ratings from third-party rating agencies and other marketing and operational considerations.

The Company's significant sources of funds are dividends and distributions from its subsidiaries, primarily its two title insurance subsidiaries. Cash is received from its subsidiaries in the form of dividends and as reimbursements for operating and other administrative expenses that it incurs. The reimbursements are executed within the guidelines of management agreements between the Company and its subsidiaries.

The ability of the Company's title insurance subsidiaries to pay dividends to the Company is subject to state regulation from their respective states of domicile. Each state regulates the extent to which title underwriters can pay dividends or make distributions and requires prior regulatory approval of the payment of dividends and other intercompany transfers. The maximum dividend permitted by law is not necessarily indicative of an insurer’s actual ability to pay dividends. Depending on regulatory conditions, the Company may in the future need to retain cash in its title insurance subsidiaries in order to maintain their statutory capital position. As of September 30, 2022, both ITIC and NITIC met the minimum capital, surplus and reserve requirements for each state in which they are licensed.

33

While state regulations and the need to cover risks may set a minimum level for capital requirements, other factors necessitate maintaining capital resources in excess of the required minimum amounts. For instance, the Company’s capital resources help it maintain high ratings from insurance company rating agencies. Superior ratings strengthen the Company's ability to compete with larger, well known title insurers with national footprints.

A strong financial position provides the necessary flexibility to fund potential acquisition activity, to invest in the Company's core business, and to minimize the financial impact of potential adverse developments. Adverse developments that generally require additional capital include adverse financial results, changes in statutory accounting requirements by regulators, reserve charges, investment losses or costs incurred to adapt to a changing regulatory environment, including costs related to CFPB regulation of the real estate industry.

The Company bases its capitalization levels, in part, on net coverage retained. Since the Company’s geographical focus has been and continues to be concentrated in states with average premium rates typically lower than the national average, capitalization relative to premiums will usually appear higher than industry averages.

Due to the Company’s historical ability to consistently generate positive cash flows from its consolidated operations and investment income, management believes that funds generated from operations will enable the Company to adequately meet its current operating needs for the foreseeable future. However, with any continued impact of COVID-19, ongoing inflationary pressures and the ongoing military conflict between Russia and Ukraine, there can be no assurance that future experience will be similar to historical experience, since it is influenced by such factors as the interest rate environment, real estate activity, the Company’s claims-paying ability and its financial strength ratings. In addition to operational and investment considerations, taking advantage of opportunistic external growth opportunities may necessitate obtaining additional capital resources. The Company is carefully monitoring the COVID-19 situation, inflation, the conflict in Ukraine, and other trends that could potentially result in material adverse liquidity changes, and will continually assess its capital allocation strategy, including decisions relating to payment of dividends, repurchasing the Company’s common stock and/or conserving cash.

Purchase of Company Stock – On November 9, 2015, the Board of Directors of the Company approved the purchase of an additional 163,335 shares pursuant to the Company’s repurchase plan, such that there was authority remaining under the plan to purchase up to an aggregate of 500,000 shares of the Company’s common stock pursuant to the plan immediately after this approval.  Unless terminated earlier by resolution of the Board of Directors, the plan will expire when all shares authorized for purchase under the plan have been purchased.  Pursuant to the Company’s ongoing purchase program, the Company purchased 629 shares in the nine-month periods ended September 30, 2022 and did not repurchase any shares in the corresponding period in 2021.  The Company anticipates increasing its purchases under the repurchase plan during the remainder of 2022 and first half of 2023, subject to such factors as the prevailing market price of the Company’s common stock, the Company’s available cash and then existing alternative uses for such cash.

Capital Expenditures – Capital expenditures were approximately $4.0 million for the nine-month period ended September 30, 2022. In 2022, the Company has plans for various capital improvement projects, including increased investment in a number of technology and system development initiatives and hardware purchases which are anticipated to be funded via cash flows from operations. All material anticipated capital expenditures are subject to periodic review and revision and may vary depending on a number of factors.

Contractual Obligations - As of September 30, 2022, the Company had a claims reserve totaling $37.6 million. The amounts and timing of these obligations are estimated and not set contractually. Events such as fraud, defalcation, and multiple property title defects can substantially and unexpectedly cause increases in both the amount and timing of estimated title insurance loss payments and loss cost trends whereby increases or decreases in inflationary factors (including the value of real estate) will influence the ultimate amount of title insurance loss payments and could increase total obligations and influence claim payout patterns. Due to the length of time over which claim payments are made and regularly occurring changes in underlying economic and market conditions, claim estimates are subject to variability and future payments could increase or decrease from these estimated amounts in the future.

ITIC, a wholly owned subsidiary of the Company, has entered into employment agreements with certain executive officers. The amounts accrued for these agreements at September 30, 2022 and December 31, 2021, were $14.2 million and $13.4 million, respectively, which includes postretirement compensation and health benefits, and were calculated based on the terms of the contracts. These executive contracts are accounted for on an individual contract basis. As payments are based upon the occurrence of specific events, including death, disability, retirement, termination without cause or upon a change in control, payment periods are currently uncertain. Information regarding retirement agreements and other postretirement benefit plans can be found in Note 5 to the unaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

34

The Company enters into lease agreements that are primarily used for office space. These leases are accounted for as operating leases. A portion of the Company's current leases include an option to extend or cancel the lease term, and the exercise of such an option is solely at the Company's discretion. The total of undiscounted future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year after 2022 is $6.3 million, which includes lease payments related to options to extend or cancel the lease term if the Company determined at the date of adoption that the lease was expected to be renewed or extended. Information about leases can be found in Note 12 to the unaudited Consolidated Financial Statements in this Quarterly Report on Form 10-Q.

In the normal course of business, the Company enters into other contractual commitments for goods and services needed for operations. Such commitments are not expected to have a material adverse effect on the Company’s liquidity.

Off-Balance Sheet Arrangements

As a service to its customers, the Company, through ITIC, administers escrow and trust deposits representing earnest money received under real estate contracts, undisbursed amounts received for settlement of mortgage loans and indemnities against specific title risks. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets. However, the Company remains contingently liable for the disposition of these deposits.

In addition, in administering tax-deferred like-kind exchanges pursuant to § 1031 of the Internal Revenue Code, ITEC serves as a qualified intermediary for exchanges, holding the net sales proceeds from relinquished property to be used for purchase of replacement property. ITAC serves as exchange accommodation titleholder and, through LLCs that are wholly owned subsidiaries of ITAC, holds property for exchangers in reverse exchange transactions. Like-kind exchange deposits and reverse exchange property held by the Company for the purpose of completing such transactions totaled approximately $477.9 million and $763.9 million as of September 30, 2022 and December 31, 2021, respectively. These exchange deposits are held at third-party financial institutions. Exchange deposits are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate. Exchange services revenue includes earnings on these deposits; therefore, investment income is shown as non-title services rather than investment income. These like-kind exchange funds are primarily invested in money market funds and other short-term investments.

External assets under management of Investors Trust Company are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets.

It is not the general practice of the Company to enter into off-balance sheet arrangements or issue guarantees to third parties. The Company does not have any material source of liquidity or financing that involves off-balance sheet arrangements. Other than items noted above, off-balance sheet arrangements are generally limited to the future payments due under various agreements with third-party service providers.

Recent Accounting Standards

No recent accounting pronouncements are expected to have a material impact on the Company’s financial position and results of operations. Please refer to Note 1 to the unaudited Consolidated Financial Statements included in this Quarterly Report on Form 10-Q for further information regarding the Company’s basis of presentation and significant accounting policies.

35

Safe Harbor for Forward-Looking Statements

This Quarterly Report on Form 10-Q, as well as information included in future filings by the Company with the SEC and information contained in written material, press releases and oral statements issued by or on behalf of the Company, contains, or may contain, “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"), that reflect management’s current outlook for future periods. These statements may be identified by the use of words such as “plan,” “expect,” “aim,” “believe,” “project,” “anticipate,” “intend,” “estimate,” “should,” “could,” “would” and other expressions that indicate future events and trends. All statements that address expectations or projections about the future, including statements about the Company’s strategy for growth, product and service development, market share position, claims, expenditures, financial results and cash requirements, are forward-looking statements. Without limitation, projected developments in mortgage interest rates and the overall economic environment set forth in “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Business Trends and Recent Conditions” constitute forward-looking statements. Forward-looking statements are based on certain assumptions and expectations of future events that are subject to a number of risks and uncertainties. Actual future results and trends may differ materially from historical results or those projected in any such forward-looking statements depending on a variety of factors, including, but not limited to, the following:

•changes in interest rates and real estate values;

•changes in general economic, business, and political conditions, including the performance of the financial and real estate markets;

•the impact of inflation;

•the impact of the ongoing military conflict between Russia and Ukraine;

•potential reform of government sponsored entities;

•the level of real estate transaction volumes, the level of mortgage origination volumes (including refinancing), the mix of title insurance between markets with varying real estate values, changes to the insurance requirements of the participants in the secondary mortgage market, and the effect of these factors on the demand for title insurance;

•the possible inadequacy of the provision for claims to cover actual claim losses;

•the incidence of fraud-related losses;

•the impact of cyberattacks (including ransomware attacks) and other cybersecurity events, including damage to the Company's reputation in the event of a serious IT breach or failure;

•the impact of COVID-19, including its variants, or other pandemics, climate change, severe weather conditions or the occurrence of another catastrophic event;

•unanticipated adverse changes in securities markets could result in material losses to the Company's investments;

•significant competition that the Company’s operating subsidiaries face, including the Company’s ability to develop and offer products and services that meet changing industry standards in a timely and cost-effective manner and expansion into new geographic locations;

•the Company’s reliance upon the North Carolina, Texas, Georgia and South Carolina markets for a significant portion of its premiums;

•compliance with government regulation, including pricing regulation, and significant changes to applicable regulations or in their application by regulators;

•the impact of governmental oversight of compliance of the Company's service providers, including the application of financial regulation designed to protect consumers;

•possible downgrades from a rating agency, which could result in a loss of underwriting business;

•the inability of the Company to manage, develop and implement technological advancements and prevent system interruptions or unauthorized system intrusions;

•statutory requirements applicable to the Company’s insurance subsidiaries that require them to maintain minimum levels of capital, surplus and reserves and that restrict the amount of dividends they may pay to the Company without prior regulatory approval;

•the desire to maintain capital above statutory minimum requirements for competitive, marketing and other reasons;

•heightened regulatory scrutiny and investigations of the title insurance industry;

•the Company’s dependence on key management and marketing personnel, the loss of whom could have a material adverse effect on the Company’s business;

•difficulty managing growth, whether organic or through acquisitions;

•unfavorable economic or other conditions could cause the Company to record impairment charges for all or a portion of its goodwill and other intangible assets;

•policies and procedures for the mitigation of risks may be insufficient to prevent losses;

•the shareholder rights plan could discourage transactions involving actual or potential changes of control; and

•other risks detailed elsewhere in this document and in the Company’s other filings with the SEC.

36

These and other risks and uncertainties may be described from time to time in the Company's other reports and filings with the SEC. For more details on factors that could affect expectations, see the 2021 Form 10-K, including under the heading "Risk Factors." The Company is not under any obligation (and expressly disclaims any such obligation) and does not undertake to update or alter any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made. You should consider the possibility that actual results may differ materially from our forward-looking statements.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

Item not required for smaller reporting companies.

Item 4.  Controls and Procedures

Disclosure Controls and Procedures

The Company's disclosure controls and procedures are designed to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified by the SEC's rules and forms. Disclosure controls and procedures include controls and procedures designed to ensure that information required to be disclosed in such reports is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure.

No system of controls, no matter how well designed and operated, can provide absolute assurance that the objectives of the system of controls are met, and no evaluation of controls can provide absolute assurance that the system of controls has operated effectively in all cases. The Company’s disclosure controls and procedures, however, are designed to provide reasonable assurance that the objectives of disclosure controls and procedures are met.

Pursuant to Rule 13a-15(b) under the Exchange Act, an evaluation was performed under the supervision and with the participation of the Company's management, including its Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of the Company's disclosure controls and procedures. Based on that evaluation, the Company's Chief Executive Officer and Chief Financial Officer concluded that the Company's disclosure controls and procedures were effective as of September 30, 2022 to provide reasonable assurance that the objectives of disclosure controls and procedures are met.

Changes in Internal Control Over Financial Reporting

During the quarter ended September 30, 2022, there were no changes in the Company's internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.

37

PART II.   OTHER INFORMATION

Item 1.  Legal Proceedings

See discussion of legal proceedings in Note 7 to the Consolidated Financial Statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q, which is incorporated by reference into this Part II, Item 1.

Item 1A. Risk Factors

There have been no material changes in the risk factors previously disclosed under Item 1A of the Company’s 2021 Form 10-K.

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

The following table provides information about purchases by the Company (and all affiliated purchasers), during the quarter ended September 30, 2022, of equity securities that are registered by the Company pursuant to Section 12 of the Exchange Act:

	Issuer Purchases of Equity Securities (unrounded)
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan	Maximum Number of Shares that May Yet Be Purchased Under the Plan (1)
Beginning of period					428,161
July 1 through July 31, 2022	—	$	—	—	428,161
August 1 through August 31, 2022	—	—		—	428,161
September 1 through September 30, 2022	629	138.45		629	427,532
Total	629	$	138.45	629	427,532

(1) On November 9, 2015, the Board of Directors of the Company approved the purchase of an additional 163,335 shares pursuant to the Company’s repurchase plan, such that there was authority remaining under the plan to purchase up to an aggregate of 500,000 shares of the Company’s common stock pursuant to the plan immediately after this approval. During the quarter ended September 30, 2022, the Company purchased a total of 629 shares of the Company's common stock under the repurchase plan. As of September 30, 2022, there was authority remaining under the plan to purchase up to an aggregate of 427,532 shares of the Company’s common stock. Unless terminated earlier by resolution of the Board of Directors, the plan will expire when all shares authorized for purchase under the plan (as such number may be amended by the Board from time to time) have been purchased. The Company anticipates making further purchases under this plan from time to time in the future, depending on such factors as the prevailing market price of the Company’s common stock, the Company’s available cash and the existing alternative uses for such cash.

Item 3.     Defaults Upon Senior Securities

None.

Item 4.     Mine Safety Disclosures

Not Applicable.

Item 5.     Other Information

None.

38

Item 6.  Exhibits

4.1	Amended and Restated Rights Agreement, dated September 30, 2022, by and between the Company and Broadridge Corporate Issuer Solutions, Inc., as Rights Agent (incorporated by reference to Exhibit 4.1 of the Company’s Form 8-K filed with the Securities and Exchange Commission on October 3, 2022)
31(i)	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31(ii)	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32	Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document*
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
104	Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)
* - The instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document

39

SIGNATURE

Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

INVESTORS TITLE COMPANY
By:	/s/ James A. Fine, Jr.
	James A. Fine, Jr., President, Treasurer, Chief
	Financial Officer, Chief Accounting Officer and
	Director (Principal Financial Officer and
	Principal Accounting Officer)

Dated:  November 8, 2022

40

EX-31.1

Exhibit 31(i)

Certification

I, J. Allen Fine, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Investors Title Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated:	November 8, 2022	/s/ J. Allen Fine
		J. Allen Fine
		Chief Executive Officer

EX-31.2

Exhibit 31(ii)

Certification

I, James A. Fine, Jr., certify that:

1.I have reviewed this quarterly report on Form 10-Q of Investors Title Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Dated:	November 8, 2022	/s/ James A. Fine, Jr.
		James A. Fine, Jr.
		Chief Financial Officer

EX-32

Exhibit 32

Certifications

Pursuant to 18 U.S.C. Section 1350,

As adopted pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Investors Title Company, a North Carolina corporation (the "Company") for the quarter ended September 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned officers of the Company does hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(i)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(ii)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated:	November 8, 2022	/s/ J. Allen Fine
		J. Allen Fine
		Chief Executive Officer
Dated:	November 8, 2022	/s/ James A. Fine, Jr.
		James A. Fine, Jr.
		Chief Financial Officer

XML

Document And Entity Information - shares	9 Months Ended
	Sep. 30, 2022	Oct. 25, 2022
Entity Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2022
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2022
Current Fiscal Year End Date	--12-31
Document Transition Report	false
Entity File Number	0-11774
Entity Central Index Key	0000720858
Entity Registrant Name	INVESTORS TITLE CO
Entity Incorporation, State or Country Code	NC
Entity Tax Identification Number	56-1110199
Entity Address, Address Line One	121 North Columbia Street
Entity Address, City or Town	Chapel Hill
Entity Address, State or Province	NC
Entity Address, Postal Zip Code	27514
City Area Code	919
Local Phone Number	968-2200
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		1,896,982
Common Stock
Entity Information [Line Items]
Title of 12(b) Security	Common Stock, no par value
Trading Symbol	ITIC
Security Exchange Name	NASDAQ
RightsToPurchaseSeriesAJuniorParticipatingPreferredStock [Member]
Entity Information [Line Items]
No Trading Symbol Flag	true
Title of 12(b) Security	Rights to Purchase Series A Junior Participating Preferred Stock
Security Exchange Name	NASDAQ

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Assets:
Cash and cash equivalents	$ 41,380	$ 37,168
Investments in securities:
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	55,307	79,791
Equity securities, at fair value (cost: September 30, 2022: $28,004; December 31, 2021: $29,478)	52,657	76,853
Short-term investments	80,785	45,930
Other investments	19,673	20,298
Total investments	208,422	222,872
Premiums and fees receivable	23,194	22,953
Accrued interest and dividends	971	817
Prepaid expenses and other receivables	12,527	11,721
Property, net	16,613	13,033
Goodwill and other intangible assets, net	17,954	15,951
Operating lease right-of-use assets	6,258	5,202
Other assets	2,320	1,771
Current income taxes recoverable	3,164	0
Total Assets	332,803	331,488
Liabilities:
Reserve for claims	37,630	36,754
Accounts payable and accrued liabilities	41,938	43,868
Operating lease liabilities	6,389	5,329
Current income taxes payable	0	3,329
Deferred income taxes, net	7,805	13,121
Total liabilities	93,762	102,401
Commitments and Contingencies	0	0
Stockholders' Equity:
Preferred stock (1,000 authorized shares; no shares issued)	0	0
Common stock – no par value (10,000 authorized shares; 1,897 and 1,895 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively, excluding in each period 292 shares of common stock held by the Company)	0	0
Retained earnings	239,792	225,861
Accumulated other comprehensive (loss) income	(751)	3,226
Total stockholders' equity	239,041	229,087
Total Liabilities and Stockholders’ Equity	$ 332,803	$ 331,488

XML

Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Thousands, $ / shares in Thousands, $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Statement of Financial Position [Abstract]
Fixed maturities, available-for-sale, amortized cost	$ 56,299	$ 75,511
Equity securities, cost	$ 28,004	$ 29,478
Preferred stock, shares authorized	1,000	1,000
Preferred stock, shares issued	0	0
Common stock, no par value	$ 0	$ 0
Common stock, shares authorized	10,000	10,000
Common stock, shares issued	1,897	1,895
Common stock, shares outstanding	1,897	1,895
Common stock, held by Company's subsidiary	292	292

XML

Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Revenues:
Net premiums written	$ 66,658	$ 72,345	$ 199,409	$ 201,349
Escrow and other title-related fees	5,963	3,863	17,236	10,148
Non-title services	3,852	2,446	9,114	6,932
Interest and dividends	1,229	893	3,055	2,807
Other investment income	2,173	2,186	4,616	4,610
Net realized investment gains	2,481	268	6,266	771
Changes in the estimated fair value of equity security investments	(4,635)	(802)	(22,722)	7,266
Other	277	217	924	4,572
Total Revenues	77,998	81,416	217,898	238,455
Operating Expenses:
Commissions to agents	33,478	37,570	97,161	102,458
Provision for claims	1,966	1,993	3,452	5,020
Personnel expenses	21,586	15,457	63,738	47,524
Office and technology expenses	4,274	3,175	12,930	9,128
Other expenses	6,606	4,784	19,783	13,285
Total Operating Expenses	67,910	62,979	197,064	177,415
Income before Income Taxes	10,088	18,437	20,834	61,040
Provision for Income Taxes	2,175	3,934	4,457	12,932
Net Income	$ 7,913	$ 14,503	$ 16,377	$ 48,108
Basic Earnings per Common Share	$ 4.17	$ 7.66	$ 8.63	$ 25.40
Weighted Average Shares Outstanding – Basic	1,897	1,894	1,897	1,894
Diluted Earnings per Common Share	$ 4.17	$ 7.63	$ 8.63	$ 25.34
Weighted Average Shares Outstanding – Diluted	1,897	1,900	1,898	1,899

XML

Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Comprehensive Income [Abstract]
Net income	$ 7,913	$ 14,503	$ 16,377	$ 48,108
Other comprehensive income, before tax:
Accumulated postretirement benefit obligation adjustment	17	0	228	0
Net unrealized losses on investments arising during the period	(1,595)	(433)	(5,537)	(1,064)
Reclassification adjustment for sale of securities included in net income	58	11	104	(19)
Reclassification adjustment for write-down of securities included in net income	35	0	162	0
Other comprehensive loss, before income tax	(1,485)	(422)	(5,043)	(1,083)
Income tax expense related to postretirement health benefits	4	0	48	0
Income tax benefit related to net unrealized losses on investments arising during the period	(338)	(91)	(1,173)	(225)
Income tax expense (benefit) related to reclassification adjustment for sale of securities included in net income	12	2	22	(4)
Income tax expense related to reclassification adjustment for write-down of securities included in net income	8	0	37	0
Net income tax benefit on other comprehensive loss	(314)	(89)	(1,066)	(229)
Other comprehensive loss	(1,171)	(333)	(3,977)	(854)
Comprehensive Income	$ 6,742	$ 14,170	$ 12,400	$ 47,254

XML

Consolidated Statements Of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands	Total	Common Stock	Retained Earnings	Accumulated Other Comprehensive Income
Balance, beginning of period, shares at Dec. 31, 2020		1,892
Balance, beginning of period at Dec. 31, 2020	$ 200,422	$ 0	$ 196,096	$ 4,326
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	48,108		48,108
Dividends paid	(2,576)		(2,576)
Exercise of stock appreciation rights (in shares)		2
Exercise of stock appreciation rights	(1)		(1)
Share-based compensation expense related to stock appreciation rights	206		206
Accumulated postretirement benefit obligation adjustment	0
Net unrealized gain (loss) on investments	(854)			(854)
Balance, end of period, shares at Sep. 30, 2021		1,894
Balance, end of period at Sep. 30, 2021	245,305	$ 0	241,833	3,472
Balance, beginning of period, shares at Jun. 30, 2021		1,894
Balance, beginning of period at Jun. 30, 2021	231,938	$ 0	228,133	3,805
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	14,503		14,503
Dividends paid	(871)		(871)
Share-based compensation expense related to stock appreciation rights	68		68
Net unrealized gain (loss) on investments	(333)			(333)
Balance, end of period, shares at Sep. 30, 2021		1,894
Balance, end of period at Sep. 30, 2021	245,305	$ 0	241,833	3,472
Balance, beginning of period, shares at Dec. 31, 2021		1,895
Balance, beginning of period at Dec. 31, 2021	229,087	$ 0	225,861	3,226
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	16,377		16,377
Dividends paid	(2,618)		(2,618)
Repurchases of common stock (in shares)		0
Repurchases of common stock	(86)		(86)
Exercise of stock appreciation rights (in shares)		2
Exercise of stock appreciation rights	(1)		(1)
Share-based compensation expense related to stock appreciation rights	259		259
Accumulated postretirement benefit obligation adjustment	180			180
Net unrealized gain (loss) on investments	(4,157)			(4,157)
Balance, end of period, shares at Sep. 30, 2022		1,897
Balance, end of period at Sep. 30, 2022	239,041	$ 0	239,792	(751)
Balance, beginning of period, shares at Jun. 30, 2022		1,897
Balance, beginning of period at Jun. 30, 2022	233,179	$ 0	232,759	420
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income	7,913		7,913
Dividends paid	(873)		(873)
Repurchases of common stock (in shares)		0
Repurchases of common stock	(86)		(86)
Share-based compensation expense related to stock appreciation rights	79		79
Accumulated postretirement benefit obligation adjustment	13			13
Net unrealized gain (loss) on investments	(1,184)			(1,184)
Balance, end of period, shares at Sep. 30, 2022		1,897
Balance, end of period at Sep. 30, 2022	$ 239,041	$ 0	$ 239,792	$ (751)

XML

Consolidated Statements Of Stockholders' Equity (Parenthetical) - $ / shares	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Statement of Stockholders' Equity [Abstract]
Common Stock, Dividends, Per Share, Cash Paid	$ 0.46	$ 0.46	$ 1.38	$ 1.36

XML

Consolidated Statements Of Cash Flows - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Operating Activities
Net income	$ 16,377	$ 48,108
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	1,679	1,298
Amortization of investments, net	270	776
Amortization of other intangible assets, net	967	412
Share-based compensation expense related to stock appreciation rights	259	206
Net gain on disposals of property	(50)	(3,991)
Net realized investment gains	(6,266)	(771)
Net change in estimated fair value of equity security investments	22,722	(7,266)
Net earnings from other investments	(2,976)	(2,678)
Provision for claims	3,452	5,020
(Benefit) provision for deferred income taxes	(4,250)	2,953
Changes in assets and liabilities:
Increase in premium and fees receivable	(241)	(3,512)
Increase in other assets	(873)	(4,971)
(Increase) decrease in operating lease right-of-use assets	(1,056)	227
Increase (Decrease) in income taxes receivable	(3,164)	0
(Decrease) increase in accounts payable and accrued liabilities	(1,702)	1,907
Increase (decrease) in operating lease liabilities	1,060	(245)
(Decrease) increase in current income taxes payable	(3,329)	66
Payments of claims, net of recoveries	(2,576)	(1,849)
Net cash provided by operating activities	20,303	35,690
Investing Activities
Purchases of fixed maturities	(350)	0
Purchases of equity securities	(5,585)	(2,663)
Purchases of short-term investments	(59,072)	(39,370)
Purchases of other investments	(1,300)	(1,084)
Purchases of subsidiary, net of cash	(4,927)	0
Proceeds from sales and maturities of fixed maturity securities	18,870	33,565
Proceeds from sales of equity securities	13,970	6,073
Proceeds from sales and maturities of short-term investments	24,372	3,311
Proceeds from sales and distributions of other investments	4,493	3,298
Proceeds from sales of other assets	30	1
Purchases of property	(3,980)	(6,778)
Proceeds from the sale of property	93	5,321
Net cash (used in) provided by investing activities	(13,386)	1,674
Financing Activities
Repurchases of common stock	(86)	0
Exercise of stock appreciation rights	(1)	(1)
Dividends paid	(2,618)	(2,576)
Net cash used in financing activities	(2,705)	(2,577)
Net Increase in Cash and Cash Equivalents	4,212	34,787
Cash and Cash Equivalents, Beginning of Period	37,168	13,723
Cash and Cash Equivalents, End of Period	41,380	48,510
Cash Paid During the Year for:
Income tax payments, net	15,200	9,913
Non-cash net unrealized loss on investments, net of deferred tax benefit of $1,114 and $229 for September 30, 2022 and 2021, respectively	4,157	854
Adjustments to postretirement benefits obligation, net of deferred tax expense of $(48) and $0 for September 30, 2022 and 2021, respectively	(180)	0
Goodwill and other intangibles acquired	(2,984)	0
Title plant acquired	(500)	0
Prepaid and other assets acquired	(121)	0
Fixed assets acquired	(1,322)	0
Purchase of subsidiary, net of cash received	$ (4,927)	$ 0

XML

Consolidated Statements Of Cash Flows (Parenthetical) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Statement of Cash Flows [Abstract]
Deferred tax benefit (provision) related to unrealized loss (gain) on investments	$ 1,114	$ 229
Adjustments to postretirement benefits obligation, net of deferred tax benefit	$ (48)	$ 0

XML

Basis Of Presentation And Significant Accounting Policies

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Basis Of Presentation And Significant Accounting Policies

Basis of Presentation and Significant Accounting Policies

Reference should be made to the “Notes to Consolidated Financial Statements” appearing in the Annual Report on Form 10-K for the year ended December 31, 2021 of Investors Title Company (the “Company”) for a complete description of the Company’s significant accounting policies.

Principles of Consolidation – The accompanying unaudited Consolidated Financial Statements include the accounts and operations of Investors Title Company and its subsidiaries, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information, with the instructions to Form 10-Q and with Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows of the Company in the accompanying unaudited Consolidated Financial Statements have been included. All such adjustments are of a normal recurring nature. Operating results for the three- and nine-month periods ended September 30, 2022 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, 2022 or any other interim period.

Use of Estimates and Assumptions – The preparation of the Company’s unaudited Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions used.

Subsequent Events – The Company has evaluated and concluded that there were no material subsequent events requiring adjustment or disclosure to its unaudited Consolidated Financial Statements.

XML

Reserves For Claims

9 Months Ended

Sep. 30, 2022

Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract]

Reserves For Claims

Reserve for Claims

Activity in the reserve for claims for the nine-month period ended September 30, 2022 and the year ended December 31, 2021 is summarized as follows:

(in thousands)	September 30, 2022		December 31, 2021
Balance, beginning of period	$	36,754	$	33,584
Provision charged to operations	3,452		5,686
Payments of claims, net of recoveries	(2,576)		(2,516)
Balance, end of period	$	37,630	$	36,754

The total reserve for all reported and unreported losses the Company incurred through September 30, 2022 is represented by the reserve for claims on the unaudited Consolidated Balance Sheets. The Company's reserves for unpaid losses and loss adjustment expenses are established using estimated amounts required to settle claims for which notice has been received (reported) and the amount estimated to be required to satisfy claims that have been incurred but not yet reported (“IBNR”). Despite the variability of such estimates, management believes that the total reserve for claims is adequate to cover claim losses which might result from pending and future claims under title insurance policies issued through September 30, 2022. Management continually reviews and adjusts its reserve for claims estimates to reflect its loss experience and any new information that becomes available. Adjustments resulting from such reviews could be significant.

A summary of the Company’s reserve for claims, broken down into its components of known title claims and IBNR, follows:

(in thousands, except percentages)	September 30, 2022		%	December 31, 2021		%
Known title claims	$	4,033	10.7	$	3,317	9.0
IBNR	33,597		89.3	33,437		91.0
Total reserve for claims	$	37,630	100.0	$	36,754	100.0

Claims and losses paid are charged to the reserve for claims. Although claims losses are typically paid in cash, occasionally claims are settled by purchasing the interest of the insured or the claimant in the real property. When this event occurs, the Company carries assets at the lower of cost or estimated fair value, net of any indebtedness on the property.

XML

Earnings Per Common Share And Share Awards

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Earnings Per Common Share And Share Awards

Earnings Per Common Share and Share Awards

Basic earnings per common share is computed by dividing net income by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per common share is computed by dividing net income by the combination of dilutive potential common stock, comprised of shares issuable under the Company’s share-based compensation plans, and the weighted average number of common shares outstanding during the reporting period. Dilutive common share equivalents include the dilutive effect of in-the-money share-based awards, which are calculated based on the average share price for each period using the treasury stock method. Under the treasury stock method, when share-based awards are assumed to be exercised, (a) the exercise price of a share-based award and (b) the amount of compensation cost, if any, for future services that the Company has not yet recognized, are assumed to be used to repurchase shares in the current period.

The following table sets forth the computation of basic and diluted earnings per share for the three- and nine-month periods ended September 30:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share amounts)	2022		2021		2022		2021
Net income	$	7,913	$	14,503	$	16,377	$	48,108
Weighted average common shares outstanding – Basic	1,897		1,894		1,897		1,894
Incremental shares outstanding assuming the exercise of dilutive SARs (share-settled)	—		6		1		5
Weighted average common shares outstanding – Diluted	1,897		1,900		1,898		1,899
Basic earnings per common share	$	4.17	$	7.66	$	8.63	$	25.40
Diluted earnings per common share	$	4.17	$	7.63	$	8.63	$	25.34

There were 26 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the three-month periods ended September 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards. There were 13 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the nine-month periods ended September 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards.

The Company historically has adopted employee stock award plans under which restricted stock, options or stock appreciation rights ("SARs") exercisable for the Company's stock may be granted to key employees or directors of the Company. There is currently one active plan from which the Company may grant share-based awards. The awards eligible to be granted under the active plan are limited to SARs, and the maximum aggregate number of shares of common stock of the Company available pursuant to the plan for the grant of SARs is 250 thousand shares. SARs give the holder the right to receive stock equal to the appreciation in the value of shares of stock from the grant date for a specified period of time, and as a result, are accounted for as equity instruments.

As of September 30, 2022, the only outstanding awards under the plans were SARs, which expire within seven years or less from the date of grant. All outstanding SARs vest and are exercisable within five years or less from the date of grant, and all SARs issued to date have been share-settled only. There have been no stock options or SARs granted where the exercise price was less than the market price on the date of grant.

A summary of share-based award transactions for all share-based award plans follows:

(in thousands, except weighted average exercise price and average remaining contractual term)	Number Of Shares	Weighted Average Exercise Price		Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2021	36	$	139.16	4.38	$	903
SARs granted	5	184.26
SARs exercised	(6)	106.71
Outstanding as of December 31, 2021	35	$	150.36	3.96	$	1,643
SARs granted	10	155.16
SARs exercised	(4)	89.23
Outstanding as of September 30, 2022	41	$	157.51	4.29	$	219
Exercisable as of September 30, 2022	28	$	162.15	3.53	$	210
Unvested as of September 30, 2022	13	$	147.24	5.96	$	9

During the second quarters of both 2022 and 2021, the Company issued 5 thousand share-settled SARs to directors of the Company. During the third quarter of 2022, the Company also issued 5 thousand share-settled SARs to employees of the Company. There were no such third quarter issuances in 2021. The fair value of each award is estimated on the date of grant using the Black-Scholes option valuation model. Expected volatilities are based on both the implied and historical volatility of the Company’s stock. The Company uses historical data to project SAR exercises and pre-exercise forfeitures within the valuation model. The expected term of awards represents the period of time that SARs granted are expected to be outstanding. The interest rate assumed for the expected life of the award is based on the U.S. Treasury yield curve in effect at the time of the grant. The weighted average fair value for the SARs issued during 2022 and 2021 were $62.60 and $59.83, respectively, and were estimated using the weighted average assumptions shown in the table below:

	2022	2021
Expected Life in Years	7.0	7.0
Volatility	35.6%	33.9%
Interest Rate	3.2%	1.3%
Yield Rate	0.6%	1.1%

There was approximately $259 thousand and $206 thousand of compensation expense relating to SARs vesting on or before September 30, 2022 and 2021, respectively, included in personnel expenses in the unaudited Consolidated Statements of Operations. As of September 30, 2022, there was $644 thousand of unrecognized compensation expense related to unvested share-based compensation arrangements granted under the Company’s stock award plans.

XML

Segment Information

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Segment Information

Segment Information

The Company has one reportable segment, title insurance services. The remaining immaterial segments have been combined into a group called “All Other.”

The title insurance segment primarily issues title insurance policies through approved attorneys from underwriting offices and through independent issuing agents. Title insurance policies insure titles to real estate.

Provided below is selected financial information about the Company's operations by segment for the periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	78,812	$	4,102	$	(6,164)	$	76,750
Investment loss	(982)		(251)		—		(1,233)
Net realized gain on investments	1,582		899		—		2,481
Total revenues	$	79,412	$	4,750	$	(6,164)	$	77,998
Operating expenses	71,516		2,406		(6,012)		67,910
Income before income taxes	$	7,896	$	2,344	$	(152)	$	10,088
Total assets	$	250,116	$	82,687	$	—	$	332,803

Three Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	79,704	$	2,776	$	(3,609)	$	78,871
Investment income	1,762		515		—		2,277
Net realized gain on investments	235		33		—		268
Total revenues	$	81,701	$	3,324	$	(3,609)	$	81,416
Operating expenses	64,022		2,414		(3,457)		62,979
Income before income taxes	$	17,679	$	910	$	(152)	$	18,437
Total assets	$	256,588	$	78,842	$	—	$	335,430

Nine Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	235,355	$	10,081	$	(18,753)	$	226,683
Investment loss	(12,154)		(2,897)		—		(15,051)
Net realized gain on investments	4,093		2,173		—		6,266
Total revenues	$	227,294	$	9,357	$	(18,753)	$	217,898
Operating expenses	206,938		8,424		(18,298)		197,064
Income before income taxes	$	20,356	$	933	$	(455)	$	20,834
Total assets	$	250,116	$	82,687	$	—	$	332,803

Nine Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	220,824	$	11,769	$	(9,592)	$	223,001
Investment income	12,662		2,021		—		14,683
Net realized gain on investments	628		143		—		771
Total revenues	$	234,114	$	13,933	$	(9,592)	$	238,455
Operating expenses	179,073		7,485		(9,143)		177,415
Income before income taxes	$	55,041	$	6,448	$	(449)	$	61,040
Total assets	$	256,588	$	78,842	$	—	$	335,430

XML

Retirement Agreements And Other Postretirement Benefits

9 Months Ended

Sep. 30, 2022

Retirement Benefits [Abstract]

Retirement Agreements And Other Postretirement Benefits

Retirement Agreements and Other Postretirement Benefits

The Company’s subsidiary, Investors Title Insurance Company ("ITIC"), is a party to employment agreements with key executives that provide for the continuation of certain employee benefits and other payments due under the agreements upon retirement, estimated to total $14.2 million and $13.4 million as of September 30, 2022 and December 31, 2021, respectively. The executive employee benefits include health, dental, vision and life insurance and are unfunded. These amounts are classified as accounts payable and accrued liabilities in the unaudited Consolidated Balance Sheets. The following sets forth the net periodic benefit cost for the executive benefits for the periods ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Service cost – benefits earned during the year	$	—	$	—	$	—	$	—
Interest cost on the projected benefit obligation	5		8		19		22
Amortization of unrecognized loss	4		—		—		—
Net periodic benefit cost	$	9	$	8	$	19	$	22

XML

Investments In Securities and Fair Value

9 Months Ended

Sep. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Investments In Securities and Fair Value

Investments and Estimated Fair Value

Investments in Fixed Maturity Securities

The estimated fair value, gross unrealized holding gains, gross unrealized holding losses and amortized cost for fixed maturity securities by major classification are as follows:

As of September 30, 2022 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	13,677	$	—	$	273	$	13,404
Special revenue issuer obligations of U.S. states, territories and political subdivisions	37,939		53		1,099		36,893
Corporate debt securities	4,683		344		17		5,010
Total	$	56,299	$	397	$	1,389	$	55,307

As of December 31, 2021 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	16,669	$	922	$	—	$	17,591
Special revenue issuer obligations of U.S. states, territories and political subdivisions	41,753		2,453		2		44,204
Corporate debt securities	17,089		955		48		17,996
Total	$	75,511	$	4,330	$	50	$	79,791

The special revenue category for both periods presented includes approximately 40 individual fixed maturity securities with revenue sources from a variety of industry sectors.

The scheduled maturities of fixed maturity securities at September 30, 2022 are as follows:

	Available-for-Sale
(in thousands)	Amortized Cost		Estimated Fair Value
Due in one year or less	$	9,320	$	9,344
Due one year through five years	35,066		34,635
Due five years through ten years	1,301		1,301
Due after ten years	10,612		10,027
Total	$	56,299	$	55,307

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

The following table presents the gross unrealized losses on fixed maturity securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position at September 30, 2022 and December 31, 2021:

	Less than 12 Months				12 Months or Longer				Total
As of September 30, 2022 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	40,573	$	(1,369)	$	1,100	$	(3)	$	41,673	$	(1,372)
Corporate debt securities	688		(16)		49		(1)		737		(17)
Total temporarily impaired securities	$	41,261	$	(1,385)	$	1,149	$	(4)	$	42,410	$	(1,389)

	Less than 12 Months				12 Months or Longer				Total
As of December 31, 2021 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	—	$	—	$	1,102	$	(2)	$	1,102	$	(2)
Corporate debt securities	8,493		(13)		6,203		(35)		14,696		(48)
Total temporarily impaired securities	$	8,493	$	(13)	$	7,305	$	(37)	$	15,798	$	(50)

Management evaluates available-for-sale fixed maturity securities in unrealized loss positions to determine whether the impairment is due to credit-related factors or noncredit-related factors. The current decline in estimated fair value of the fixed maturity securities can be attributed primarily to changes in market interest rates and changes in credit spreads over Treasury securities.

Factors considered in determining whether a loss is temporary include the length of time and extent to which the estimated fair value has been below cost, the financial condition and prospects of the issuer (including credit ratings and analyst reports) and macro-economic changes. A total of 54 and 9 fixed maturity securities had unrealized losses at September 30, 2022 and December 31, 2021, respectively. The Company does not intend to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost. The fair value is expected to recover as the securities approach their maturity date, or repricing date, or if market yields for such investments decline. The Company believes that the unrealized losses detailed in the previous table are due to noncredit-related factors, including changes in market interest rates and other market conditions, and therefore the unrealized loss is recorded in accumulated other comprehensive (loss) income.

Reviews of the values of fixed maturity securities are inherently uncertain and the value of the investment may not fully recover, or may decline in future periods, resulting in a realized loss. The Company recorded $162 thousand in other-than-temporary impairment charges related to fixed maturity securities for the nine-month period ended September 30, 2022 and had no recorded other-than-temporary impairment charges for nine-month period ended September 30, 2021. Expenses related to other-than-temporary impairments are recorded in net realized investment gains in the unaudited Consolidated Statements of Operations when recognized.

Investments in Equity Securities

The cost and estimated fair value of equity securities are as follows:

As of September 30, 2022 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	28,004	$	52,657
Total	$	28,004	$	52,657

As of December 31, 2021 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	29,478	$	76,853
Total	$	29,478	$	76,853

Unrealized holding gains and losses are reported in the unaudited Consolidated Statements of Operations as changes in the estimated fair value of equity security investments.

Net Realized Investment Gains

Gross realized gains and losses on sales of investments for the nine-month periods ended September 30, 2022 and 2021 are summarized as follows:

(in thousands)	2022		2021
Gross realized gains from securities:
Corporate debt securities	$	—	$	53
Common stocks	7,120		1,428
Total	$	7,120	$	1,481
Gross realized losses from securities:
Corporate debt securities	$	(104)	$	(34)
Common stocks	(209)		(677)
Write-down of securities	(162)		—
Total	$	(475)	$	(711)
Net realized gains from securities	$	6,645	$	770
Gross realized gains (losses) on other investments:
Gains on other investments	$	30	$	1
Losses on other investments	(409)		—
Total	$	(379)	$	1
Net realized investment gains	$	6,266	$	771

Realized gains and losses are determined on the specific identification method.  

Variable Interest Entities

The Company holds investments in variable interest entities ("VIEs") that are not consolidated in the Company's financial statements as the Company is not the primary beneficiary. These entities are considered VIEs as the equity investors at risk, including the Company, do not have the power over the activities that most significantly impact the economic performance of the entities; this power resides with a third-party general partner or managing member that cannot be removed except for cause. The following table sets forth details about the Company's variable interest investments in VIEs, which are structured either as limited partnerships ("LPs") or limited liability companies ("LLCs"), as of September 30, 2022:

(in thousands)	Balance Sheet Classification	Carrying Value		Estimated Fair Value		Maximum Potential Loss (a)
Real estate LLCs or LPs	Other investments	$	3,538	$	5,166	$	5,408
Small business investment LPs	Other investments	8,946		9,234		14,320
Total		$	12,484	$	14,400	$	19,728

(a) Maximum potential loss is calculated as the total investment in the LLC or LP, including any capital commitments that may have not yet been called. The Company is not exposed to any loss beyond the total commitment of its investment.

Valuation of Financial Assets

The Financial Accounting Standards Board has established a valuation hierarchy for disclosure of the inputs used to measure estimated fair value of financial assets and liabilities, such as securities. This hierarchy categorizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s own assumptions used to measure assets and liabilities at fair value.

A financial instrument’s classification within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement – consequently, if there are multiple significant valuation inputs that are categorized in different levels of the hierarchy, the instrument’s hierarchy level is the lowest level (with Level 3 being the lowest level) within which any significant input falls.

The Level 1 category includes equity securities and U.S. Treasury securities that are measured at estimated fair value using quoted active market prices.

The Level 2 category includes fixed maturity securities such as corporate debt securities, U.S. government obligations, and obligations of U.S. states, territories, and political subdivisions. Estimated fair value is principally based on market values obtained from a third-party pricing service. Factors that are used in determining estimated fair market value include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. The Company receives one quote per security from a third-party pricing service, although as discussed below, the Company does consult other pricing resources when confirming that the prices it obtains reflect the fair values of the instruments in accordance with GAAP. Generally, quotes obtained from the pricing service for instruments classified as Level 2 are not adjusted and are not binding. As of September 30, 2022 and December 31, 2021, the Company did not adjust any Level 2 fair values.

A number of the Company’s investment grade corporate debt securities are frequently traded in active markets, and trading prices are consequently available for these securities. However, these securities are classified as Level 2 because the pricing service from which the Company has obtained estimated fair values for these instruments uses valuation models that use observable market inputs in addition to trading prices. Substantially all of the input assumptions used in the service’s model are observable in the marketplace or can be derived or supported by observable market data.

In the measurement of the estimated fair value of certain financial instruments, other valuation techniques were utilized if quoted market prices were not available. These derived fair value estimates are significantly affected by the assumptions used. Additionally, certain financial instruments, including those related to insurance contracts, pension and other postretirement benefits, and equity method investments are excluded from the scope of disclosures.

In estimating the fair value of the financial instruments presented, the Company used the following methods and assumptions:

Cash and cash equivalents

The carrying amount for cash and cash equivalents is a reasonable estimate of fair value due to the short-term maturity of these investments.

Measurement alternative equity investments

The measurement alternative method requires investments without readily determinable fair values to be recorded at cost, less impairments, and plus or minus any changes resulting from observable price changes.  The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Accrued interest and dividends

The carrying amount for accrued interest and dividends is a reasonable estimate of fair value due to the short-term maturity of these assets.

The following table presents, by level, fixed maturity securities carried at estimated fair value as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	50,297	$	—	$	50,297
Corporate debt securities	—		5,010		—		5,010
Total	$	—	$	55,307	$	—	$	55,307

As of December 31, 2021 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	61,795	$	—	$	61,795
Corporate debt securities	—		17,996		—		17,996
Total	$	—	$	79,791	$	—	$	79,791

*Denotes fair market value obtained from pricing services.

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	41,380	$	—	$	—	$	41,380
Accrued interest and dividends	971		—		—		971
Equity securities, at fair value:
Common stocks	52,657		—		—		52,657
Short-term investments:
Money market funds and US treasury bills	80,785		—		—		80,785
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,852		8,852
Total	$	175,793	$	—	$	8,852	$	184,645

As of December 31, 2021 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	37,168	$	—	$	—	$	37,168
Accrued interest and dividends	817		—		—		817
Equity securities, at fair value:
Common stocks	76,853		—		—		76,853
Short-term investments:
Money market funds	45,930		—		—		45,930
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,688		8,688
Total	$	160,768	$	—	$	8,688	$	169,456

The Company did not hold any Level 3 category debt or marketable equity investment securities as of September 30, 2022 or December 31, 2021.

There were no transfers into or out of Levels 1, 2 or 3 during the periods presented.

To help ensure that estimated fair value determinations are consistent with GAAP, prices from our pricing services go through multiple review processes to ensure appropriate pricing. Pricing procedures and inputs used to price each security include, but are not limited to, the following: unadjusted quoted market prices for identical securities such as stock market closing prices; non-binding quoted prices for identical securities in markets that are not active; interest rates; yield curves observable at commonly quoted intervals; volatility; prepayment speeds; loss severity; credit risks; and default rates. The Company reviews the procedures and inputs used by its pricing services, and verifies a sample of the services’ quotes by comparing them to values obtained from other pricing resources. In the event the Company disagrees with a price provided by its pricing services, the respective service reevaluates the price to corroborate the market information and then reviews inputs to the evaluation in light of potentially new market data.

Certain equity investments under the measurement alternative are measured at estimated fair value on a non-recurring basis and are reviewed for impairment quarterly. If any such investment is determined to be other-than-temporarily impaired, an impairment charge is recorded against such investment and reflected in the unaudited Consolidated Statements of Operations. There were no impairments of such investments made during the nine-month period ended September 30, 2022 or the twelve-month period ended December 31, 2021. The following table presents a rollforward of equity investments under the measurement alternative as of September 30, 2022 and December 31, 2021:

(in thousands)	Balance, January 1, 2022		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, September 30, 2022
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852
Total	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852

(in thousands)	Balance, January 1, 2021		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, December 31, 2021
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688
Total	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688

XML

Commitments And Contingencies

9 Months Ended

Sep. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments And Contingencies

Commitments and Contingencies

Legal Proceedings – The Company and its subsidiaries are involved in legal proceedings that are incidental to their business. In the Company’s opinion, based on the present status of these proceedings, any potential liability of the Company or its subsidiaries with respect to these legal proceedings is not expected to, in the aggregate, be material to the Company’s consolidated financial condition or operations.

Regulation – The Company’s title insurance and trust subsidiaries are regulated by various federal, state and local governmental agencies and are subject to various audits and inquiries. It is the opinion of management based on its present expectations that these audits and inquiries will not have a material impact on the Company’s consolidated financial condition or operations.

Escrow and Trust Deposits – As a service to its customers, the Company, through ITIC, administers escrow and trust deposits representing earnest money received under real estate contracts, escrowed funds received under escrow agreements, undisbursed amounts received for settlement of mortgage loans and indemnities against specific title risks. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of these deposits.

Like-Kind Exchanges Proceeds – In administering tax-deferred like-kind exchanges pursuant to § 1031 of the Internal Revenue Code, the Company’s wholly owned subsidiary, Investors Title Exchange Corporation (“ITEC”), serves as a qualified intermediary, holding the net sales proceeds from relinquished property to be used for purchase of replacement property. Another wholly owned subsidiary, Investors Title Accommodation Corporation (“ITAC”), serves as exchange accommodation titleholder and, through LLCs that are wholly owned subsidiaries of ITAC, holds property for exchangers in reverse exchange transactions. Like-kind exchange deposits and reverse exchange property totaled approximately $477.9 million and $763.9 million as of September 30, 2022 and December 31, 2021, respectively. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate. Exchange services revenue includes earnings on these deposits; therefore, investment income is shown as other income rather than investment income. These like-kind exchange funds are primarily invested in money market funds and other short-term investments.

COVID-19 – COVID-19 could continue to affect the Company in a number of ways including, but not limited to, the impact of employees becoming ill, quarantined, or otherwise unable to work or travel due to illness or governmental restriction, potential decreases in net premiums written in the future, and future fluctuations in the Company's investment portfolio.

XML

Related Party Transactions

9 Months Ended

Sep. 30, 2022

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

The Company does business with, and has investments in, unconsolidated LLCs that are primarily title insurance agencies. The Company utilizes the equity method to account for its investment in these LLCs. The following table sets forth the approximate values by year found within each financial statement classification:

Financial Statement Classification, Consolidated Balance Sheets (unaudited) (in thousands)	As of September 30, 2022		As of December 31, 2021
Other investments	$	5,787	$	6,623
Premium and fees receivable	$	833	$	882

Financial Statement Classification, Consolidated Statements of Operations (unaudited) (in thousands)	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net premiums written	$	6,935	$	7,649	$	20,921	$	21,583
Non-title services and other investment income	$	1,237	$	1,318	$	3,493	$	3,148
Commissions to agents	$	4,969	$	5,507	$	14,501	$	14,770

XML

Business Combinations, Intangible Assets, Goodwill and Title Plants

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Business Combinations, Intangible Assets, Goodwill and Title Plants

Intangible Assets, Goodwill and Title Plants

The Company evaluates nonorganic growth opportunities, such as acquisitions of title insurance agencies, from time to time in the ordinary course of business. During the nine-month period ended September 30, 2022, a subsidiary of the Company acquired a title insurance agency, now wholly owned, doing business in the state of Texas.

Intangible Assets

The estimated fair values of intangible assets recognized as the result of title insurance agency acquisitions, all Level 3 inputs, are principally based on values obtained from an independent third-party valuation service. In accordance with ASC 350, Intangibles – Goodwill and Other, management determined that no events or changes in circumstances occurred during the nine-month periods ended September 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that no identifiable intangible assets were impaired.

Identifiable intangible assets consist of the following:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Referral relationships	$	8,898	$	8,567
Non-compete agreements	3,155		2,938
Tradename	747		747
Total	12,800		12,252
Accumulated amortization	(4,486)		(3,505)
Identifiable intangible assets, net	$	8,314	$	8,747

The following table provides the estimated aggregate amortization expense for each of the five succeeding fiscal years:

Year Ended (in thousands)
2022	$	328
2023	1,345
2024	1,162
2025	1,079
2026	1,079
Thereafter	3,134
Total	$	8,127

Goodwill and Title Plants

As of September 30, 2022, the Company recognized $9.6 million in goodwill and $1.4 million in title plants, net of impairments, as the result of title insurance agency acquisitions.  The title plants are included with other assets in the unaudited Consolidated Balance Sheets. The fair values of goodwill and the title plants as of the date of acquisition, both Level 3 inputs, were principally based on values obtained from an independent third-party valuation service. In accordance with ASC 350, management determined that no events or changes in circumstances occurred during the nine-month periods ended September 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and, therefore, determined that there were no goodwill or title plant impairments.

XML

Accumulated Other Comprehensive Income

9 Months Ended

Sep. 30, 2022

Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income

Accumulated Other Comprehensive (Loss) Income

The following table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	397	$	23	$	420
Other comprehensive (loss) income before calculations	(1,257)		13		(1,244)
Amounts reclassified from accumulated other comprehensive (loss) income	73		—		73
Net current-period other comprehensive (loss) income	(1,184)		13		(1,171)
Ending balance	$	(787)	$	36	$	(751)

Three Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	3,949	$	(144)	$	3,805
Other comprehensive (loss) income before calculations	(342)		—		(342)
Amounts reclassified from accumulated other comprehensive (loss) income	9		—		9
Net current-period other comprehensive (loss) income	(333)		—		(333)
Ending balance	$	3,616	$	(144)	$	3,472

Nine Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	3,370	$	(144)	$	3,226
Other comprehensive (loss) income before calculations	(4,364)		180		(4,184)
Amounts reclassified from accumulated other comprehensive (loss) income	207		—		207
Net current-period other comprehensive (loss) income	(4,157)		180		(3,977)
Ending balance	$	(787)	$	36	$	(751)

Nine Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	4,470	$	(144)	$	4,326
Other comprehensive (loss) income before calculations	(839)		—		(839)
Amounts reclassified from accumulated other comprehensive (loss) income	(15)		—		(15)
Net current-period other comprehensive (loss) income	(854)		—		(854)
Ending balance	$	3,616	$	(144)	$	3,472

The following table provides significant amounts reclassified out of each component of accumulated other comprehensive (loss) income for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(58)
Write-down of securities	(35)
Total	$	(93)	Net realized investment gains
Tax	20		Provision for income taxes
Net of Tax	$	(73)
Reclassifications for the period	$	(73)

Three Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(11)
Write-down of securities	—
Total	$	(11)	Net realized investment gains
Tax	2		Provision for income taxes
Net of Tax	$	(9)
Reclassifications for the period	$	(9)

Nine Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(104)
Write-down of securities	(162)
Total	$	(266)	Net realized investment gains
Tax	59		Provision for income taxes
Net of Tax	$	(207)
Reclassifications for the period	$	(207)

Nine Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments	$	19
Write-down of securities	—
Total	$	19	Net realized investment gains
Tax	(4)		Provision for income taxes
Net of Tax	$	15
Reclassifications for the period	$	15

XML

Revenue Recognition

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue from Contracts with Customers

GAAP requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance does not apply to revenue associated with insurance contracts (including title insurance policies), financial instruments and lease contracts, and therefore is primarily applicable to the following Company revenue categories.

Escrow and other title-related fees: The Company’s title segment recognizes commission revenue and fees related to items such as searches, settlements, commitments and other ancillary services. Escrow and other title-related fees are recognized as revenue at the time of the related transactions as the earnings process, or performance obligation, is then considered to be complete.

Non-title services: Through various subsidiaries, the Company offers management services, tax-deferred real property exchange services, investment management and trust services. Nonrefundable exchange fees are recognized as revenue upon receipt of the funds, which is at the time of closing of the initial sale of property. All other non-title service fees are recognized as revenue as performance obligations are completed.

Other: The Company occasionally recognizes revenue from other miscellaneous contracts which can include, but is not limited to, seminar and education registration fees and software licensing contracts. These revenue streams are deemed immaterial to the operations of the Company, and revenue is recognized when, or as, performance obligations are completed.

The following table provides a breakdown of the Company’s revenue by major business activity:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Revenue from contracts with customers:
Escrow and other title-related fees	$	5,963	$	3,863	$	17,236	$	10,148
Non-title services	3,852		2,446		9,114		6,932
Total revenue from contracts with customers	9,815		6,309		26,350		17,080
Other sources of revenue:
Net premiums written	66,658		72,345		199,409		201,349
Investment-related revenue (loss)	1,248		2,545		(8,785)		15,454
Other	277		217		924		4,572
Total revenues	$	77,998	$	81,416	$	217,898	$	238,455

XML

Leases

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Lessee, Operating Leases

Leases

The Company enters into lease agreements that are primarily used for office space. These leases are accounted for as operating leases, with lease expense recognized on a straight-line basis over the term of the lease.

A portion of the Company's current leases include an option to extend or cancel the lease term. The exercise of such an option is solely at the Company's discretion. The operating lease liability recorded in the unaudited Consolidated Balance Sheets includes lease payments related to options to extend or cancel the lease term if the Company determined at the date of adoption that the lease was expected to be renewed or extended. The Company, in determining the present value of lease payments, utilized the average rate over a 10-year term based upon the Moody's seasoned Aaa corporate bond yields, as explicit rates of interest were not readily determinable in the lease contracts. The Company does not carry debt; thus no incremental borrowing rate was available to the Company.

Lease expense is included in office and technology expenses in the unaudited Consolidated Statements of Operations. Information regarding the Company’s operating leases follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Operating leases	$	697	$	350	$	1,876	$	1,002
Short-term leases (b)	64		93		177		249
Lease expense	$	761	$	443	$	2,053	$	1,251
Sub-lease income	—		—		—		—
Lease cost	$	761	$	443	$	2,053	$	1,251

(b) Leases with an initial term of twelve months or less are not recorded on the unaudited Consolidated Balance Sheets.

Components of the operating lease liability presented on the unaudited Consolidated Balance Sheets are as follows:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Current:
Operating lease liabilities	$	2,083	$	1,547
Non-current:
Operating lease liabilities	4,306		3,782
Total operating lease liabilities	$	6,389	$	5,329

The future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of September 30, 2022, are summarized as follows:

Year Ended (in thousands)
2022	$	544
2023	2,168
2024	1,729
2025	1,194
2026	893
Thereafter	316
Total undiscounted payments	$	6,844
Less: present value adjustment	(455)
Operating lease liabilities	$	6,389

Supplemental lease information is as follows:

	As of September 30, 2022		As of December 31, 2021
Weighted average remaining lease term (years)	3.62		4.13
Weighted average discount rate	3.9	%	4.2	%

The Company does not have any material pending operating or financing lease agreements that become effective in future periods.

XML

Basis Of Presentation And Significant Accounting Policies (Policy)

9 Months Ended

Sep. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Principles Of Consolidation

Principles of Consolidation – The accompanying unaudited Consolidated Financial Statements include the accounts and operations of Investors Title Company and its subsidiaries, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information, with the instructions to Form 10-Q and with Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows of the Company in the accompanying unaudited Consolidated Financial Statements have been included. All such adjustments are of a normal recurring nature. Operating results for the three- and nine-month periods ended September 30, 2022 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, 2022 or any other interim period.

Use Of Estimates And Assumptions

Use of Estimates and Assumptions – The preparation of the Company’s unaudited Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates and assumptions used.

Subsequent Events, Policy

Subsequent Events – The Company has evaluated and concluded that there were no material subsequent events requiring adjustment or disclosure to its unaudited Consolidated Financial Statements.

XML

Reserves For Claims (Tables)

9 Months Ended

Sep. 30, 2022

Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract]

Summary Of Transactions In Reserves For Claims

Activity in the reserve for claims for the nine-month period ended September 30, 2022 and the year ended December 31, 2021 is summarized as follows:

(in thousands)	September 30, 2022		December 31, 2021
Balance, beginning of period	$	36,754	$	33,584
Provision charged to operations	3,452		5,686
Payments of claims, net of recoveries	(2,576)		(2,516)
Balance, end of period	$	37,630	$	36,754

Summary of the Company's Loss Reserves

A summary of the Company’s reserve for claims, broken down into its components of known title claims and IBNR, follows:

(in thousands, except percentages)	September 30, 2022		%	December 31, 2021		%
Known title claims	$	4,033	10.7	$	3,317	9.0
IBNR	33,597		89.3	33,437		91.0
Total reserve for claims	$	37,630	100.0	$	36,754	100.0

XML

Earnings Per Common Share And Share Awards (Tables)

9 Months Ended

Sep. 30, 2022

Earnings Per Share [Abstract]

Computation Of Basic And Diluted Earnings Per Share

The following table sets forth the computation of basic and diluted earnings per share for the three- and nine-month periods ended September 30:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands, except per share amounts)	2022		2021		2022		2021
Net income	$	7,913	$	14,503	$	16,377	$	48,108
Weighted average common shares outstanding – Basic	1,897		1,894		1,897		1,894
Incremental shares outstanding assuming the exercise of dilutive SARs (share-settled)	—		6		1		5
Weighted average common shares outstanding – Diluted	1,897		1,900		1,898		1,899
Basic earnings per common share	$	4.17	$	7.66	$	8.63	$	25.40
Diluted earnings per common share	$	4.17	$	7.63	$	8.63	$	25.34

Summary Of Share-Based Award Transactions

A summary of share-based award transactions for all share-based award plans follows:

(in thousands, except weighted average exercise price and average remaining contractual term)	Number Of Shares	Weighted Average Exercise Price		Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2021	36	$	139.16	4.38	$	903
SARs granted	5	184.26
SARs exercised	(6)	106.71
Outstanding as of December 31, 2021	35	$	150.36	3.96	$	1,643
SARs granted	10	155.16
SARs exercised	(4)	89.23
Outstanding as of September 30, 2022	41	$	157.51	4.29	$	219
Exercisable as of September 30, 2022	28	$	162.15	3.53	$	210
Unvested as of September 30, 2022	13	$	147.24	5.96	$	9

Share-Based Valuation Assumptions

The weighted average fair value for the SARs issued during 2022 and 2021 were $62.60 and $59.83, respectively, and were estimated using the weighted average assumptions shown in the table below:

	2022	2021
Expected Life in Years	7.0	7.0
Volatility	35.6%	33.9%
Interest Rate	3.2%	1.3%
Yield Rate	0.6%	1.1%

XML

Segment Information (Tables)

9 Months Ended

Sep. 30, 2022

Segment Reporting [Abstract]

Selected Financial Information About The Company's Operations By Segment

Provided below is selected financial information about the Company's operations by segment for the periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	78,812	$	4,102	$	(6,164)	$	76,750
Investment loss	(982)		(251)		—		(1,233)
Net realized gain on investments	1,582		899		—		2,481
Total revenues	$	79,412	$	4,750	$	(6,164)	$	77,998
Operating expenses	71,516		2,406		(6,012)		67,910
Income before income taxes	$	7,896	$	2,344	$	(152)	$	10,088
Total assets	$	250,116	$	82,687	$	—	$	332,803

Three Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	79,704	$	2,776	$	(3,609)	$	78,871
Investment income	1,762		515		—		2,277
Net realized gain on investments	235		33		—		268
Total revenues	$	81,701	$	3,324	$	(3,609)	$	81,416
Operating expenses	64,022		2,414		(3,457)		62,979
Income before income taxes	$	17,679	$	910	$	(152)	$	18,437
Total assets	$	256,588	$	78,842	$	—	$	335,430

Nine Months Ended September 30, 2022 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	235,355	$	10,081	$	(18,753)	$	226,683
Investment loss	(12,154)		(2,897)		—		(15,051)
Net realized gain on investments	4,093		2,173		—		6,266
Total revenues	$	227,294	$	9,357	$	(18,753)	$	217,898
Operating expenses	206,938		8,424		(18,298)		197,064
Income before income taxes	$	20,356	$	933	$	(455)	$	20,834
Total assets	$	250,116	$	82,687	$	—	$	332,803

Nine Months Ended September 30, 2021 (in thousands)	Title Insurance		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	220,824	$	11,769	$	(9,592)	$	223,001
Investment income	12,662		2,021		—		14,683
Net realized gain on investments	628		143		—		771
Total revenues	$	234,114	$	13,933	$	(9,592)	$	238,455
Operating expenses	179,073		7,485		(9,143)		177,415
Income before income taxes	$	55,041	$	6,448	$	(449)	$	61,040
Total assets	$	256,588	$	78,842	$	—	$	335,430

XML

Retirement Agreements And Other Postretirement Benefits (Tables)

9 Months Ended

Sep. 30, 2022

Retirement Benefits [Abstract]

Components Of Net Periodic Benefits Cost

The following sets forth the net periodic benefit cost for the executive benefits for the periods ended September 30, 2022 and 2021:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Service cost – benefits earned during the year	$	—	$	—	$	—	$	—
Interest cost on the projected benefit obligation	5		8		19		22
Amortization of unrecognized loss	4		—		—		—
Net periodic benefit cost	$	9	$	8	$	19	$	22

XML

Investments In Securities and Fair Value (Tables)

9 Months Ended

Sep. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Schedule of Gross Unrealized Gains (Losses) and Amortized Cost for Securities

The estimated fair value, gross unrealized holding gains, gross unrealized holding losses and amortized cost for fixed maturity securities by major classification are as follows:

As of September 30, 2022 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	13,677	$	—	$	273	$	13,404
Special revenue issuer obligations of U.S. states, territories and political subdivisions	37,939		53		1,099		36,893
Corporate debt securities	4,683		344		17		5,010
Total	$	56,299	$	397	$	1,389	$	55,307

As of December 31, 2021 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	16,669	$	922	$	—	$	17,591
Special revenue issuer obligations of U.S. states, territories and political subdivisions	41,753		2,453		2		44,204
Corporate debt securities	17,089		955		48		17,996
Total	$	75,511	$	4,330	$	50	$	79,791

The cost and estimated fair value of equity securities are as follows:

As of September 30, 2022 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	28,004	$	52,657
Total	$	28,004	$	52,657

As of December 31, 2021 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	29,478	$	76,853
Total	$	29,478	$	76,853

Schedule Of Fixed Maturity Securities

The scheduled maturities of fixed maturity securities at September 30, 2022 are as follows:

	Available-for-Sale
(in thousands)	Amortized Cost		Estimated Fair Value
Due in one year or less	$	9,320	$	9,344
Due one year through five years	35,066		34,635
Due five years through ten years	1,301		1,301
Due after ten years	10,612		10,027
Total	$	56,299	$	55,307

Schedule of Unrealized Loss on Investments

The following table presents the gross unrealized losses on fixed maturity securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position at September 30, 2022 and December 31, 2021:

	Less than 12 Months				12 Months or Longer				Total
As of September 30, 2022 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	40,573	$	(1,369)	$	1,100	$	(3)	$	41,673	$	(1,372)
Corporate debt securities	688		(16)		49		(1)		737		(17)
Total temporarily impaired securities	$	41,261	$	(1,385)	$	1,149	$	(4)	$	42,410	$	(1,389)

	Less than 12 Months				12 Months or Longer				Total
As of December 31, 2021 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Special revenue issuer obligations of U.S. states, territories and political subdivisions	$	—	$	—	$	1,102	$	(2)	$	1,102	$	(2)
Corporate debt securities	8,493		(13)		6,203		(35)		14,696		(48)
Total temporarily impaired securities	$	8,493	$	(13)	$	7,305	$	(37)	$	15,798	$	(50)

Schedule Of Gross Realized Gains And Losses On Securities

Gross realized gains and losses on sales of investments for the nine-month periods ended September 30, 2022 and 2021 are summarized as follows:

(in thousands)	2022		2021
Gross realized gains from securities:
Corporate debt securities	$	—	$	53
Common stocks	7,120		1,428
Total	$	7,120	$	1,481
Gross realized losses from securities:
Corporate debt securities	$	(104)	$	(34)
Common stocks	(209)		(677)
Write-down of securities	(162)		—
Total	$	(475)	$	(711)
Net realized gains from securities	$	6,645	$	770
Gross realized gains (losses) on other investments:
Gains on other investments	$	30	$	1
Losses on other investments	(409)		—
Total	$	(379)	$	1
Net realized investment gains	$	6,266	$	771

Schedule of Variable Interest Entities

The following table sets forth details about the Company's variable interest investments in VIEs, which are structured either as limited partnerships ("LPs") or limited liability companies ("LLCs"), as of September 30, 2022:

(in thousands)	Balance Sheet Classification	Carrying Value		Estimated Fair Value		Maximum Potential Loss (a)
Real estate LLCs or LPs	Other investments	$	3,538	$	5,166	$	5,408
Small business investment LPs	Other investments	8,946		9,234		14,320
Total		$	12,484	$	14,400	$	19,728

(a) Maximum potential loss is calculated as the total investment in the LLC or LP, including any capital commitments that may have not yet been called. The Company is not exposed to any loss beyond the total commitment of its investment.

Schedule Of Fair Value Assets Measured On Recurring Basis

The following table presents, by level, fixed maturity securities carried at estimated fair value as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	50,297	$	—	$	50,297
Corporate debt securities	—		5,010		—		5,010
Total	$	—	$	55,307	$	—	$	55,307

As of December 31, 2021 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	—	$	61,795	$	—	$	61,795
Corporate debt securities	—		17,996		—		17,996
Total	$	—	$	79,791	$	—	$	79,791

*Denotes fair market value obtained from pricing services.

Schedule Of Carrying Value And Fair Value Of Financial Assets Disclosed

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of September 30, 2022 and December 31, 2021:

As of September 30, 2022 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	41,380	$	—	$	—	$	41,380
Accrued interest and dividends	971		—		—		971
Equity securities, at fair value:
Common stocks	52,657		—		—		52,657
Short-term investments:
Money market funds and US treasury bills	80,785		—		—		80,785
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,852		8,852
Total	$	175,793	$	—	$	8,852	$	184,645

As of December 31, 2021 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	37,168	$	—	$	—	$	37,168
Accrued interest and dividends	817		—		—		817
Equity securities, at fair value:
Common stocks	76,853		—		—		76,853
Short-term investments:
Money market funds	45,930		—		—		45,930
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	—		—		8,688		8,688
Total	$	160,768	$	—	$	8,688	$	169,456

Schedule of Cost Method Investments

The following table presents a rollforward of equity investments under the measurement alternative as of September 30, 2022 and December 31, 2021:

(in thousands)	Balance, January 1, 2022		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, September 30, 2022
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852
Total	$	8,688	$	—	$	—	$	1,037	$	(873)	$	8,852

(in thousands)	Balance, January 1, 2021		Amounts Impaired		Observable Changes		Purchases and Additional Commitments Paid		Sales, Returns of Capital and Other Reductions		Balance, December 31, 2021
Other investments:
Equity investments in unconsolidated affiliates, measurement alternative	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688
Total	$	8,741	$	—	$	—	$	1,543	$	(1,596)	$	8,688

XML

Related Party Transactions (Tables)

9 Months Ended

Sep. 30, 2022

Related Party Transactions [Abstract]

Summary Of Approximate Values By Year Found Within Consolidated Balance Sheets

The following table sets forth the approximate values by year found within each financial statement classification:

Financial Statement Classification, Consolidated Balance Sheets (unaudited) (in thousands)	As of September 30, 2022		As of December 31, 2021
Other investments	$	5,787	$	6,623
Premium and fees receivable	$	833	$	882

Summary Of Approximate Values By Year Found Within Consolidated Statements Of Income

Financial Statement Classification, Consolidated Statements of Operations (unaudited) (in thousands)	Three Months Ended September 30,				Nine Months Ended September 30,
	2022		2021		2022		2021
Net premiums written	$	6,935	$	7,649	$	20,921	$	21,583
Non-title services and other investment income	$	1,237	$	1,318	$	3,493	$	3,148
Commissions to agents	$	4,969	$	5,507	$	14,501	$	14,770

XML

Intangible Assets, Goodwill and Title Plant (Tables)

9 Months Ended

Sep. 30, 2022

Business Combinations [Abstract]

Schedule of Finite-Lived Intangible Assets

Identifiable intangible assets consist of the following:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Referral relationships	$	8,898	$	8,567
Non-compete agreements	3,155		2,938
Tradename	747		747
Total	12,800		12,252
Accumulated amortization	(4,486)		(3,505)
Identifiable intangible assets, net	$	8,314	$	8,747

Schedule Of Aggregate Amortization Expense for Intangible Assets

The following table provides the estimated aggregate amortization expense for each of the five succeeding fiscal years:

Year Ended (in thousands)
2022	$	328
2023	1,345
2024	1,162
2025	1,079
2026	1,079
Thereafter	3,134
Total	$	8,127

XML

Accumulated Other Comprehensive Income (Tables)

9 Months Ended

Sep. 30, 2022

Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule Of Changes In Balances Of Each Component Of Accumulated Other Comprehensive Income, Net Of Tax

The following table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	397	$	23	$	420
Other comprehensive (loss) income before calculations	(1,257)		13		(1,244)
Amounts reclassified from accumulated other comprehensive (loss) income	73		—		73
Net current-period other comprehensive (loss) income	(1,184)		13		(1,171)
Ending balance	$	(787)	$	36	$	(751)

Three Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at June 30	$	3,949	$	(144)	$	3,805
Other comprehensive (loss) income before calculations	(342)		—		(342)
Amounts reclassified from accumulated other comprehensive (loss) income	9		—		9
Net current-period other comprehensive (loss) income	(333)		—		(333)
Ending balance	$	3,616	$	(144)	$	3,472

Nine Months Ended September 30, 2022 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	3,370	$	(144)	$	3,226
Other comprehensive (loss) income before calculations	(4,364)		180		(4,184)
Amounts reclassified from accumulated other comprehensive (loss) income	207		—		207
Net current-period other comprehensive (loss) income	(4,157)		180		(3,977)
Ending balance	$	(787)	$	36	$	(751)

Nine Months Ended September 30, 2021 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	4,470	$	(144)	$	4,326
Other comprehensive (loss) income before calculations	(839)		—		(839)
Amounts reclassified from accumulated other comprehensive (loss) income	(15)		—		(15)
Net current-period other comprehensive (loss) income	(854)		—		(854)
Ending balance	$	3,616	$	(144)	$	3,472

Schedule Of Reclassification Out Of Accumulated Other Comprehensive Income

The following table provides significant amounts reclassified out of each component of accumulated other comprehensive (loss) income for the three- and nine-month periods ended September 30, 2022 and 2021:

Three Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(58)
Write-down of securities	(35)
Total	$	(93)	Net realized investment gains
Tax	20		Provision for income taxes
Net of Tax	$	(73)
Reclassifications for the period	$	(73)

Three Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(11)
Write-down of securities	—
Total	$	(11)	Net realized investment gains
Tax	2		Provision for income taxes
Net of Tax	$	(9)
Reclassifications for the period	$	(9)

Nine Months Ended September 30, 2022 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized loss on investments	$	(104)
Write-down of securities	(162)
Total	$	(266)	Net realized investment gains
Tax	59		Provision for income taxes
Net of Tax	$	(207)
Reclassifications for the period	$	(207)

Nine Months Ended September 30, 2021 (in thousands)
Details about Accumulated Other Comprehensive (Loss) Income Components	Amount Reclassified from Accumulated Other Comprehensive (Loss) Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments	$	19
Write-down of securities	—
Total	$	19	Net realized investment gains
Tax	(4)		Provision for income taxes
Net of Tax	$	15
Reclassifications for the period	$	15

XML

Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Revenue from contracts with customers:
Escrow and other title-related fees	$	5,963	$	3,863	$	17,236	$	10,148
Non-title services	3,852		2,446		9,114		6,932
Total revenue from contracts with customers	9,815		6,309		26,350		17,080
Other sources of revenue:
Net premiums written	66,658		72,345		199,409		201,349
Investment-related revenue (loss)	1,248		2,545		(8,785)		15,454
Other	277		217		924		4,572
Total revenues	$	77,998	$	81,416	$	217,898	$	238,455

XML

Leases (Tables)

9 Months Ended

Sep. 30, 2022

Leases [Abstract]

Lease, Cost

Lease expense is included in office and technology expenses in the unaudited Consolidated Statements of Operations. Information regarding the Company’s operating leases follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
(in thousands)	2022		2021		2022		2021
Operating leases	$	697	$	350	$	1,876	$	1,002
Short-term leases (b)	64		93		177		249
Lease expense	$	761	$	443	$	2,053	$	1,251
Sub-lease income	—		—		—		—
Lease cost	$	761	$	443	$	2,053	$	1,251

(b) Leases with an initial term of twelve months or less are not recorded on the unaudited Consolidated Balance Sheets.

Lessee, Operating Lease Liability, Current and Non-current

Components of the operating lease liability presented on the unaudited Consolidated Balance Sheets are as follows:

(in thousands)	As of September 30, 2022		As of December 31, 2021
Current:
Operating lease liabilities	$	2,083	$	1,547
Non-current:
Operating lease liabilities	4,306		3,782
Total operating lease liabilities	$	6,389	$	5,329

Lessee, Operating Lease, Liability, Maturity

The future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of September 30, 2022, are summarized as follows:

Year Ended (in thousands)
2022	$	544
2023	2,168
2024	1,729
2025	1,194
2026	893
Thereafter	316
Total undiscounted payments	$	6,844
Less: present value adjustment	(455)
Operating lease liabilities	$	6,389

Operating Lease Other Information

Supplemental lease information is as follows:

	As of September 30, 2022		As of December 31, 2021
Weighted average remaining lease term (years)	3.62		4.13
Weighted average discount rate	3.9	%	4.2	%

XML

Reserves For Claims Summary Of Transactions In Reserves For Claims (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward]
Liability for title claims and claims adjustment expense	$ 37,630	$ 36,754	$ 33,584
Provision charged to operations	3,452	5,686
Payments of claims, net of recoveries	$ (2,576)	$ (2,516)

XML

Reserves For Claims Summary Of The Company's Loss Reserves (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Liability for Future Policy Benefits and Unpaid Claims and Claims Adjustment Expense [Abstract]
Known title claims	$ 4,033	$ 3,317
IBNR	33,597	33,437
Total reserve for claims	$ 37,630	$ 36,754	$ 33,584
% of known title reserves	10.70%	9.00%
% of IBNR	89.30%	91.00%
% of total loss reserves	100.00%	100.00%

XML

Earnings Per Common Share And Share Awards (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended				9 Months Ended		12 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Sep. 30, 2021	Jun. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Earnings Per Common Share And Share Awards [Line Items]
Anti-dilutive shares excluded from computation of diluted earnings per share	26		14		13	14
Number of SARs granted where exercise price was less than market price on date of grant					0	0
Share-based Compensation Arrangement by Share-based Payment Award, Grants in Period, Weighted Average Grant Date Fair Value					$ 62.60	$ 59.83
SARs
Earnings Per Common Share And Share Awards [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Grants in Period, Net of Forfeitures	5	5	0	5	10		5
Share-based Payment Arrangement, Expense					$ 259	$ 206
Share-based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Amount	$ 644				$ 644
Maximum | SARs
Earnings Per Common Share And Share Awards [Line Items]
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award					250
SARs expiration period					7 years
SARs vesting period					5 years

XML

Computation Of Basic And Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Earnings Per Share [Abstract]
Net income	$ 7,913	$ 14,503	$ 16,377	$ 48,108
Weighted average common shares outstanding - Basic	1,897	1,894	1,897	1,894
Incremental shares outstanding assuming the exercise of dilutive stock options and SARs (share settled)	0	6	1	5
Weighted average common shares outstanding - Diluted	1,897	1,900	1,898	1,899
Basic Earnings per Common Share	$ 4.17	$ 7.66	$ 8.63	$ 25.40
Diluted Earnings per Common Share	$ 4.17	$ 7.63	$ 8.63	$ 25.34

XML

Earnings Per Common Share And Share Awards Summary Of Share-Based Award Transactions (Details) - SARs - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended				9 Months Ended	12 Months Ended
	Sep. 30, 2022	Jun. 30, 2022	Sep. 30, 2021	Jun. 30, 2021	Sep. 30, 2022	Dec. 31, 2021	Dec. 31, 2020
Share-based Compensation Arrangement by Share-based Payment Award, SARS, Outstanding [Roll Forward]
Number Of Shares, Outstanding Beginning Balance					35	36
Number Of Shares, SARs granted	5	5	0	5	10	5
Number Of Shares, SARS exercised					(4)	(6)
Number Of Shares, Outstanding Ending Balance	41				41	35	36
Number Of Shares, Exercisable as of September 30, 2022	28				28
Number Of Shares, Unvested as of September 30, 2022	13				13
Share-based Compensation Arrangement by Share-based Payment Award, SARs, Outstanding, Weighted Average Exercise Price [Roll Forward]
Weighted Average Exercise Price, Outstanding Beginning Balance					$ 150.36	$ 139.16
Weighted Average Exercise Price, SARs granted					155.16	184.26
Weighted Average Exercise Price, SARS exercised					89.23	106.71
Weighted Average Exercise Price, Outstanding Ending Balance	$ 157.51				157.51	$ 150.36	$ 139.16
Weighted Average Exercise Price, Exercisable as of September 30, 2022	162.15				162.15
Weighted Average Exercise Price, Unvested as of September 30, 2022	$ 147.24				$ 147.24
Average Remaining Contractual Term, Outstanding Beginning Balance					4 years 3 months 14 days	3 years 11 months 15 days	4 years 4 months 17 days
Average Remaining Contractual Term, Outstanding Ending Balance					4 years 3 months 14 days	3 years 11 months 15 days	4 years 4 months 17 days
Average Remaining Contractual Term, Exercisable as of September 30, 2022					3 years 6 months 10 days
Average Remaining Contractual Term, Unvested as of September 30, 2022					5 years 11 months 15 days
Aggregate Intrinsic Value, Outstanding Beginning Balance					$ 1,643	$ 903
Aggregate Intrinsic Value, Outstanding Ending Balance	$ 219				219	$ 1,643	$ 903
Aggregate Intrinsic Value, Exercisable as of September 30, 2022	210				210
Aggregate Intrinsic Value, Unvested as of September 30, 2022	$ 9				$ 9

XML

Earnings Per Common Share And Share Awards Share-Based Valuation Assumptions (Details) - SARs	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life in years	7 years	7 years
Volatility	35.60%	33.90%
Interest rate	3.20%	1.30%
Yield rate	0.60%	1.10%

XML

Segment Information Selected Financial Information By Segment (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2021 USD ($)	Sep. 30, 2022 USD ($) segment	Sep. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments | segment			1
Insurance and other services revenue	$ 76,750	$ 78,871	$ 226,683	$ 223,001
Investment income (loss)	(1,233)	2,277	(15,051)	14,683
Gain (Loss) on Investments	2,481	268	6,266	771
Total Revenues	77,998	81,416	217,898	238,455
Operating expenses	67,910	62,979	197,064	177,415
Income (loss) before income taxes	10,088	18,437	20,834	61,040
Total assets	332,803	335,430	332,803	335,430	$ 331,488
Intersegment Eliminations
Segment Reporting Information [Line Items]
Insurance and other services revenue	(6,164)	(3,609)	(18,753)	(9,592)
Investment income (loss)	0	0	0	0
Gain (Loss) on Investments	0	0	0	0
Total Revenues	(6,164)	(3,609)	(18,753)	(9,592)
Operating expenses	(6,012)	(3,457)	(18,298)	(9,143)
Income (loss) before income taxes	(152)	(152)	(455)	(449)
Total assets	0	0	0	0
Title Insurance | Title Insurance
Segment Reporting Information [Line Items]
Insurance and other services revenue	78,812	79,704	235,355	220,824
Investment income (loss)	(982)	1,762	(12,154)	12,662
Gain (Loss) on Investments	1,582	235	4,093	628
Total Revenues	79,412	81,701	227,294	234,114
Operating expenses	71,516	64,022	206,938	179,073
Income (loss) before income taxes	7,896	17,679	20,356	55,041
Total assets	250,116	256,588	250,116	256,588
All Other | Title Insurance
Segment Reporting Information [Line Items]
Insurance and other services revenue	4,102	2,776	10,081	11,769
Investment income (loss)	(251)	515	(2,897)	2,021
Gain (Loss) on Investments	899	33	2,173	143
Total Revenues	4,750	3,324	9,357	13,933
Operating expenses	2,406	2,414	8,424	7,485
Income (loss) before income taxes	2,344	910	933	6,448
Total assets	$ 82,687	$ 78,842	$ 82,687	$ 78,842

XML

Retirement Agreements And Other Postretirement Benefits (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Retirement Benefits [Abstract]
Liability for employee benefits and other payments	$ 14,200		$ 14,200		$ 13,400
Defined Benefit Plan Disclosure [Line Items]
Service cost - benefits earned during the year	0	$ 0	0	$ 0
Interest cost on the projected benefit obligation	5	8	19	22
Amortization of unrecognized losses	4	0	0	0
Net periodic benefits costs	$ 9	$ 8	$ 19	$ 22

XML

Investments In Securities and Fair Value (Details) - USD ($) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Dec. 31, 2021
Investments, Debt and Equity Securities [Abstract]
Other-than-temporary impairment loss, debt securities, available-for-sale, recognized in earnings	$ 162	$ 0
Impaired amount for measurement alternative investments	$ 0		$ 0

XML

Investments In Securities and Fair Value (Schedule Of Gross Unrealized Gains And Losses And Amortized Cost For Securities) (Details) $ in Thousands	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Debt and Equity Securities, FV-NI [Line Items]
Total, amortized cost	$ 56,299	$ 75,511
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	55,307	79,791
General obligations of U.S. states, territories and political subdivisions
Debt and Equity Securities, FV-NI [Line Items]
Total, amortized cost	13,677	16,669
Debt securities, available-for-sale, accumulated gross unrealized gain, before tax	0	922
Debt securities, available-for-sale, accumulated gross unrealized loss, before tax	273	0
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	13,404	17,591
Special revenue issuer obligations of U.S. states, territories and political subdivisions
Debt and Equity Securities, FV-NI [Line Items]
Total, amortized cost	37,939	41,753
Debt securities, available-for-sale, accumulated gross unrealized gain, before tax	53	2,453
Debt securities, available-for-sale, accumulated gross unrealized loss, before tax	1,099	2
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	$ 36,893	$ 44,204
Number of Special Revenue Bonds	40	40
Corporate debt securities
Debt and Equity Securities, FV-NI [Line Items]
Total, amortized cost	$ 4,683	$ 17,089
Debt securities, available-for-sale, accumulated gross unrealized gain, before tax	344	955
Debt securities, available-for-sale, accumulated gross unrealized loss, before tax	17	48
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	5,010	17,996
Total fixed maturities
Debt and Equity Securities, FV-NI [Line Items]
Total, amortized cost	56,299	75,511
Debt securities, available-for-sale, accumulated gross unrealized gain, before tax	397	4,330
Debt securities, available-for-sale, accumulated gross unrealized loss, before tax	1,389	50
Fixed maturity securities, available-for-sale, at fair value (amortized cost: September 30, 2022: $56,299; December 31, 2021: $75,511)	$ 55,307	$ 79,791

XML

Investments In Securities and Fair Value (Schedule Of Fixed Maturity Securities) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Investments, Debt and Equity Securities [Abstract]
Due in one year or less, Amortized Cost	$ 9,320
Due after one year through five years, Amortized Cost	35,066
Due five years through ten years, Amortized Cost	1,301
Due after ten years, Amortized Cost	10,612
Total, amortized cost	56,299	$ 75,511
Due in one year or less, Fair Value	9,344
Due after one year through five years, Fair Value	34,635
Due five years through ten years, Fair Value	1,301
Due after ten years, Fair Value	10,027
Total, Fair Value	$ 55,307	$ 79,791

XML

Investments In Securities and Fair Value (Schedule Of Unrealized Losses On Investments) (Details) $ in Thousands	Sep. 30, 2022 USD ($)	Dec. 31, 2021 USD ($)
Debt Securities, Available-for-sale [Line Items]
Debt Securities, Available-for-sale, Unrealized Loss Position, Number of Positions	54	9
Special revenue issuer obligations of U.S. states, territories and political subdivisions
Debt Securities, Available-for-sale [Line Items]
Total temporarily impaired securities, Less than 12 Months, Fair Value	$ 40,573	$ 0
Total temporarily impaired securities, Less than 12 Months, Unrealized Losses	(1,369)	0
Total temporarily impaired securities, 12 Months or Longer, Fair Value	1,100	1,102
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(3)	(2)
Debt Securities, Available-for-sale, Unrealized Loss Position, Total	41,673	1,102
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss	(1,372)	(2)
Corporate debt securities
Debt Securities, Available-for-sale [Line Items]
Total temporarily impaired securities, Less than 12 Months, Fair Value	688	8,493
Total temporarily impaired securities, Less than 12 Months, Unrealized Losses	(16)	(13)
Total temporarily impaired securities, 12 Months or Longer, Fair Value	49	6,203
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(1)	(35)
Debt Securities, Available-for-sale, Unrealized Loss Position, Total	737	14,696
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss	(17)	(48)
Total temporarily impaired securities
Debt Securities, Available-for-sale [Line Items]
Total temporarily impaired securities, Less than 12 Months, Fair Value	41,261	8,493
Total temporarily impaired securities, Less than 12 Months, Unrealized Losses	(1,385)	(13)
Total temporarily impaired securities, 12 Months or Longer, Fair Value	1,149	7,305
Debt Securities, Available-for-sale, Continuous Unrealized Loss Position, 12 Months or Longer, Accumulated Loss	(4)	(37)
Debt Securities, Available-for-sale, Unrealized Loss Position, Total	42,410	15,798
Debt Securities, Available-for-sale, Unrealized Loss Position, Accumulated Loss	$ (1,389)	$ (50)

XML

Investments In Securities and Fair Value (Schedule of Equity Securities) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities, Cost	$ 28,004	$ 29,478
Equity securities, estimated fair value	52,657	76,853
Common stocks
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Equity Securities, Cost	28,004	29,478
Equity securities, estimated fair value	$ 52,657	$ 76,853

XML

Investments In Securities and Fair Value (Schedule Of Gross Realized Gains And Losses On Securities) (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Debt Securities, Available-for-sale [Line Items]
Debt securities, realized gains			$ 0	$ 53
Equity securities, realized gains			7,120	1,428
Debit and equity securities, realized gains			7,120	1,481
Debt Securities, Available-for-sale, Realized Loss			(104)	(34)
Equity securities, realized losses			(209)	(677)
Other-than-temporary impairment, gross realized losses			(162)	0
Debt and Equity Securities, Realized Loss			(475)	(711)
Debt and equity securities, net realized gain (loss)			6,645	770
Gross gains on sales of other investments			30	1
Gross losses on sales of other investments			(409)	0
Net gains (losses) on sales of other investments			(379)	1
Net realized investment gains (losses)	$ 2,481	$ 268	$ 6,266	$ 771

XML

Investments In Securities and Fair Value (Schedule of Variable Interest Entities) (Details) - Other investments $ in Thousands	Sep. 30, 2022 USD ($)
Variable Interest Entity, Not Primary Beneficiary [Line Items]
Carrying Value	$ 12,484
Estimated Fair Value	14,400
Maximum Potential Loss (a)	19,728
Real Estate LLCs or LPs
Variable Interest Entity, Not Primary Beneficiary [Line Items]
Carrying Value	3,538
Estimated Fair Value	5,166
Maximum Potential Loss (a)	5,408
Small Business Investment LPs
Variable Interest Entity, Not Primary Beneficiary [Line Items]
Carrying Value	8,946
Estimated Fair Value	9,234
Maximum Potential Loss (a)	$ 14,320

XML

Investments In Securities and Fair Value (Schedule Of Fair Value Assets Measured On Recurring Basis) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	$ 55,307	$ 79,791
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	55,307	79,791
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0	0
General obligations of U.S. states, territories and political subdivisions
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	50,297	61,795
General obligations of U.S. states, territories and political subdivisions | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0	0
General obligations of U.S. states, territories and political subdivisions | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	50,297	61,795
General obligations of U.S. states, territories and political subdivisions | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0	0
Corporate debt securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	5,010	17,996
Corporate debt securities | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	0	0
Corporate debt securities | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	5,010	17,996
Corporate debt securities | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Debt Securities, Available-for-sale	$ 0	$ 0

XML

Investments in Securities and Fair Value (Schedule of Carrying Value and Fair Value of Financial Assets Disclosed) (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	$ 41,380	$ 37,168
Accrued interest and dividends	971	817
Equity securities, estimated fair value	52,657	76,853
Money market funds and US treasury bills	80,785	45,930
Equity investments in unconsolidated affiliates, measurement alternative	8,852	8,688
Assets, fair value disclosure	184,645	169,456
Level 1
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	41,380	37,168
Accrued interest and dividends	971	817
Equity securities, estimated fair value	52,657	76,853
Money market funds and US treasury bills	80,785	45,930
Equity investments in unconsolidated affiliates, measurement alternative	0	0
Assets, fair value disclosure	175,793	160,768
Level 2
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	0	0
Accrued interest and dividends	0	0
Equity securities, estimated fair value	0	0
Money market funds and US treasury bills	0	0
Equity investments in unconsolidated affiliates, measurement alternative	0	0
Assets, fair value disclosure	0	0
Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Cash and cash equivalents	0	0
Accrued interest and dividends	0	0
Equity securities, estimated fair value	0	0
Money market funds and US treasury bills	0	0
Equity investments in unconsolidated affiliates, measurement alternative	8,852	8,688
Assets, fair value disclosure	$ 8,852	$ 8,688

XML

Investments In Securities and Fair Value (Schedule of Cost-method Investments) (Details) - USD ($) $ in Thousands	9 Months Ended	12 Months Ended
	Sep. 30, 2022	Dec. 31, 2021
Fair​Value​Assets​Measured​On​Nonrecurring​Basis​Reconciliation​Calculation​Roll​Forward [Line Items]
Beginning balance	$ 8,688	$ 8,741
Other than temporary impairment losses, investments	0	0
Observable changes	0	0
Purchases and additional commitments paid	1,037	1,543
Sales, returns of capital, and other reductions	(873)	(1,596)
Ending balance	8,852	8,688
Cost-method Investments
Fair​Value​Assets​Measured​On​Nonrecurring​Basis​Reconciliation​Calculation​Roll​Forward [Line Items]
Beginning balance	8,688	8,741
Other than temporary impairment losses, investments	0	0
Observable changes	0	0
Purchases and additional commitments paid	1,037	1,543
Sales, returns of capital, and other reductions	(873)	(1,596)
Ending balance	$ 8,852	$ 8,688

XML

Commitments And Contingencies (Details) - USD ($) $ in Millions	Sep. 30, 2022	Dec. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Like-kind exchange deposits and reverse exchange property	$ 477.9	$ 763.9

XML

Related Party Transactions Summary Of Approximate Values By Year Found Within Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Related Party Transaction [Line Items]
Other investments	$ 19,673	$ 20,298
Premiums and fees receivable	23,194	22,953
Title Insurance Agencies
Related Party Transaction [Line Items]
Other investments	5,787	6,623
Premiums and fees receivable	$ 833	$ 882

XML

Related Party Transactions Summary Of Approximate Values By Year Found Within Consolidated Statements Of Income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Related Party Transaction [Line Items]
Net premiums written	$ 66,658	$ 72,345	$ 199,409	$ 201,349
Other	277	217	924	4,572
Commissions to agents	33,478	37,570	97,161	102,458
Title Insurance Agencies
Related Party Transaction [Line Items]
Net premiums written	6,935	7,649	20,921	21,583
Other	1,237	1,318	3,493	3,148
Commissions to agents	$ 4,969	$ 5,507	$ 14,501	$ 14,770

XML

Intangible Assets, Goodwill and Title Plant (Details) - USD ($) $ in Thousands	9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021
Business Combinations [Abstract]
Impairment of Intangible Assets (Excluding Goodwill)	$ 0	$ 0
Goodwill	9,600
Title Plants	1,400
Goodwill, Impairment Loss	$ 0	$ 0

XML

Intangible Assets, Goodwill and Title Plant Schedule of Finite-Lived Intangible Assets (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Schedule of Finite-Lived Intangible Assets [Abstract]
Referral relationships	$ 8,898	$ 8,567
Non-compete agreements	3,155	2,938
Tradename	747	747
Total	12,800	12,252
Accumulated amortization	(4,486)	(3,505)
Identifiable intangible assets, net	$ 8,314	$ 8,747

XML

Business Combinations, Intangible Assets and Goodwill, Schedule of Aggregate Amortization Expense for Intangible Assets (Details) $ in Thousands	Sep. 30, 2022 USD ($)
Business Combinations [Abstract]
2022	$ 328
2023	1,345
2024	1,162
2025	1,079
2026	1,079
Thereafter	3,134
Identifiable intangible assets, net	$ 8,127

XML

Accumulated Other Comprehensive Income Balances Of Each Component Of Accumulated Other Comprehensive Income, Net Of Tax (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance			$ 3,226
Other comprehensive loss	$ (1,171)	$ (333)	(3,977)	$ (854)
Ending balance	(751)		(751)
Unrealized Gains and Losses On Available-for-Sale Securities
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	397	3,949	3,370	4,470
Other comprehensive income before calculations	(1,257)	(342)	(4,364)	(839)
Amounts reclassified from accumulated other comprehensive income	73	9	207	(15)
Other comprehensive loss	(1,184)	(333)	(4,157)	(854)
Ending balance	(787)	3,616	(787)	3,616
Postretirement Benefit Plans
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	23	(144)	(144)	(144)
Other comprehensive income before calculations	13	0	180	0
Amounts reclassified from accumulated other comprehensive income	0	0	0	0
Other comprehensive loss	13	0	180	0
Ending balance	36	(144)	36	(144)
Accumulated Other Comprehensive Income
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	420	3,805	3,226	4,326
Other comprehensive income before calculations	(1,244)	(342)	(4,184)	(839)
Amounts reclassified from accumulated other comprehensive income	73	9	207	(15)
Other comprehensive loss	(1,171)	(333)	(3,977)	(854)
Ending balance	$ (751)	$ 3,472	$ (751)	$ 3,472

XML

Accumulated Other Comprehensive Income Reclassification Out Of Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gain (Loss) on Investments	$ 2,481	$ 268	$ 6,266	$ 771
Write-down of securities			(162)	0
Income (loss) before income taxes	10,088	18,437	20,834	61,040
Tax	(2,175)	(3,934)	(4,457)	(12,932)
Net income	7,913	14,503	16,377	48,108
Reclassification out of Accumulated Other Comprehensive Income
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net income	(73)	(9)	(207)	15
Reclassification out of Accumulated Other Comprehensive Income | Unrealized Gains and Losses on Available-For-Sale Securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Gain (Loss) on Investments	(58)	(11)	(104)	19
Write-down of securities	(35)	0	(162)	0
Income (loss) before income taxes	(93)	(11)	(266)	19
Tax	20	2	59	(4)
Net income	$ (73)	$ (9)	$ (207)	$ 15

XML

Revenue Recognition (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	$ 9,815	$ 6,309	$ 26,350	$ 17,080
Total Revenues	77,998	81,416	217,898	238,455
Escrow and other title-related fees
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	5,963	3,863	17,236	10,148
Non-title services
Disaggregation of Revenue [Line Items]
Revenue from contracts with customers	3,852	2,446	9,114	6,932
Net premiums written
Disaggregation of Revenue [Line Items]
Other sources of revenue	66,658	72,345	199,409	201,349
Investment-related revenue (loss)
Disaggregation of Revenue [Line Items]
Other sources of revenue	1,248	2,545	(8,785)	15,454
Other
Disaggregation of Revenue [Line Items]
Other sources of revenue	$ 277	$ 217	$ 924	$ 4,572

XML

Leases Operating Lease Cost (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2022	Sep. 30, 2021	Sep. 30, 2022	Sep. 30, 2021
Leases [Abstract]
Lease expense	$ 697	$ 350	$ 1,876	$ 1,002
Short-term leases	64	93	177	249
Sub-lease income	0	0	0	0
Lease cost	$ 761	$ 443	$ 2,053	$ 1,251

XML

Leases Current and Noncurrent Lease Liabilities (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Operating lease, liability, current	$ 2,083	$ 1,547
Operating lease, liability, noncurrent	4,306	3,782
Operating lease, liability	$ 6,389	$ 5,329

XML

Leases Schedule of Lease Payments (Details) - USD ($) $ in Thousands	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
2022	$ 544
2023	2,168
2024	1,729
2025	1,194
2026	893
Thereafter	316
Total undiscounted payments	6,844
Less: present value adjustment	(455)
Operating lease, liability	$ 6,389	$ 5,329

XML

Leases Other Information (Details)	Sep. 30, 2022	Dec. 31, 2021
Leases [Abstract]
Weighted average remaining lease term (years)	3 years 7 months 13 days	4 years 1 month 17 days
Weighted average discount rate	3.90%	4.20%