NOTE C - Investments in Marketable Debt Securities

The Company's investments in marketable debt securities are classified as available-for-sale. These investments are stated at fair value with any unrealized gains or losses, net of tax, included as a component of accumulated other comprehensive income (loss) (AOCI).

The Company utilizes third-party pricing services for all of its marketable debt security valuations. The Company reviews the pricing methodology used by the third‑party pricing services, including the manner employed to collect market information. On a quarterly basis, the Company also performs review and validation procedures on the pricing information received from the third‑party providers. These procedures help ensure that the fair value information used by the Company is determined in accordance with applicable accounting guidance.

The Company evaluates its investment in marketable debt securities at the end of each reporting period to determine if a decline in fair value is other-than-temporary. Realized losses are recognized upon management’s determination that a decline in fair value is other-than-temporary. The determination of other-than-temporary impairment is a subjective process, requiring the use of judgments and assumptions regarding the amount and timing of recovery. The Company reviews and evaluates its investments at least quarterly to identify investments that have indications of other-than-temporary impairments. It is reasonably possible that a change in estimate could occur in the near term relating to other-than-temporary impairment. Accordingly, the Company considers several factors when evaluating debt securities for other-than-temporary impairment, including whether the decline in fair value of the security is due to increased default risk for the specific issuer or market interest-rate risk.

In assessing default risk, the Company considers the collectability of principal and interest payments by monitoring changes to issuers’ credit ratings, specific credit events associated with individual issuers as well as the credit ratings of any financial guarantor, and the extent and duration to which amortized cost exceeds fair value.

In assessing market interest rate risk, including benchmark interest rates and credit spreads, the Company considers its intent for selling the securities and whether it is more likely than not the Company will be able to hold these securities until the recovery of any unrealized losses.

Marketable debt securities at March 31, 2018 and December 31, 2017 consisted of the following:

	AMORTIZED		UNREALIZED		UNREALIZED		FAIR
At March 31, 2018	COST		GAINS		LOSSES		VALUE
U.S. tax-exempt securities	$	523.6			$	2.5	$	521.1
U.S. corporate securities		50.5	$	.1		.4		50.2
U.S. government and agency securities		59.1				.4		58.7
Non-U.S. corporate securities		246.9		.5		1.9		245.5
Non-U.S. government securities		53.4		.1		.1		53.4
Other debt securities		118.7				1.1		117.6
	$	1,052.2	$	.7	$	6.4	$	1,046.5

	AMORTIZED		UNREALIZED		UNREALIZED		FAIR
At December 31, 2017	COST		GAINS		LOSSES		VALUE
U.S. tax-exempt securities	$	537.9			$	2.4	$	535.5
U.S. corporate securities		89.7	$	.2		.2		89.7
U.S. government and agency securities		48.9				.2		48.7
Non-U.S. corporate securities		459.4		1.3		1.4		459.3
Non-U.S. government securities		91.5		.3		.1		91.7
Other debt securities		142.8		.1		.7		142.2
	$	1,370.2	$	1.9	$	5.0	$	1,367.1

The cost of marketable debt securities is adjusted for amortization of premiums and accretion of discounts to maturity. Amortization, accretion, interest and dividend income and realized gains and losses are included in investment income. The cost of securities sold is based on the specific identification method. Gross realized gains were $.9 and $.5 and gross realized losses were $.5 and $.2 for the three month periods ended March 31, 2018 and 2017, respectively.

Marketable debt securities with continuous unrealized losses and their related fair values were as follows:

	March 31, 2018				December 31, 2017
	LESS THAN		TWELVE MONTHS		LESS THAN		TWELVE MONTHS
	TWELVE MONTHS		OR GREATER		TWELVE MONTHS		OR GREATER
Fair value	$	841.6	$	22.7	$	908.5	$	18.4
Unrealized losses		6.1		.3		4.8		.2

For the investment securities in gross unrealized loss positions identified above, the Company does not intend to sell the investment securities. It is more likely than not that the Company will not be required to sell the investment securities before recovery of the unrealized losses, and the Company expects that the contractual principal and interest will be received on the investment securities. As a result, the Company recognized no other-than-temporary impairments during the periods presented.

Contractual maturities on marketable debt securities at March 31, 2018 were as follows:

	AMORTIZED		FAIR
Maturities:	COST		VALUE
Within one year	$	333.7	$	333.2
One to five years		694.1		688.9
More than ten years		24.4		24.4
	$	1,052.2	$	1,046.5