2.Investments:

The cost or amortized cost and the estimated fair value of investments in debt and equity securities by category is as follows (in thousands):


			Gross		Gross
		Cost/Amortized	Unrealized		Unrealized
	Cost		Gains		Losses		Fair Value
As of December 31, 2019
U.S. Treasury securities and obligations of U.S. Government	$	66,441	$	162	$	(3)	$	66,600
Corporate bonds		297,601		3,387		(163)		300,825
Collateralized corporate bank loans		115,669		556		(468)		115,757
Municipal bonds		81,787		1,531		(48)		83,270
Mortgage-backed		8,000		46		(219)		7,827
Total debt securities		569,498		5,682		(901)		574,279
Total equity securities		71,895		35,028		(7,708)		99,215
Total other investments		3,763		—		(1,594)		2,169
Total investments	$	645,156	$	40,710	$	(10,203)	$	675,663

As of December 31, 2018
U.S. Treasury securities and obligations of U.S. Government	$	48,609	$	5	$	(508)	$	48,106
Corporate bonds		243,314		440		(1,602)		242,152
Collateralized corporate bank loans		131,779		19		(5,270)		126,528
Municipal bonds		112,574		3,791		(838)		115,527
Mortgage-backed		13,992		11		(446)		13,557
Total debt securities		550,268		4,266		(8,664)		545,870
Total equity securities		68,709		20,693		(8,506)		80,896
Total other investments		3,763		—		(2,615)		1,148
Total investments	$	622,740	$	24,959	$	(19,785)	$	627,914

Major categories of net investment income are summarized as follows (in thousands):


	Twelve Months Ended December 31,
	2019		2018
U.S. Treasury securities and obligations of U.S. Government	$	916	$	902
Corporate bonds		7,317		6,696
Collateralized corporate bank loans		6,028		5,658
Municipal bonds		3,907		3,757
Mortgage-backed		311		521
Equity securities		2,364		1,151
Cash and cash equivalents		766		518
		21,609		19,203
Investment expenses		(1,005)		(971)
Investment income, net of expenses	$	20,604	$	18,232

No investments in any entity or its affiliates exceeded 10% of stockholders’ equity at December 31, 2019 or 2018.

Major categories of net investment gains (losses) on investments are summarized as follows (in thousands):


	Year Ended December 31,
	2019		2018
U.S. Treasury securities and obligations of U.S. Government	$	—	$	—
Corporate bonds		235		(83)
Collateralized corporate bank loans		(34)		90
Municipal bonds		4,270		1,435
Mortgage-backed		—		2
Equity securities		(7)		359
Gain on investments		4,464		1,803
Unrealized gains (losses) on equity securities		15,133		(9,322)
Unrealized gains (losses) on other investments		1,021		(2,676)
Investment gains (losses), net	$	20,618	$	(10,195)

We realized gross gains on investments of $5.0 million and $2.5 million during the years ended December 31, 2019 and 2018, respectively, of which $4.1 million and $1.5 million were from the sales of securities during the years ended December 31, 2019 and 2018, respectively. We realized gross losses on investments of $0.5 million and $0.7 million during the years ended December 31, 2019 and 2018, respectively, of which $0.1 million was from the sale of securities during the year ended December 31, 2019. Our realized losses during the year ended December 31, 2018 did not include sales from securities. We recorded proceeds from the sale of investment securities of $13.0 million, and $17.7 million during the years ended December 31, 2019 and 2018, respectively. Realized investment gains and losses are recognized in operations on the first in-first out method.

The following schedules summarize the gross unrealized losses showing the length of time that investments have been continuously in an unrealized loss position as of December 31, 2019 and December 31, 2018 (in thousands):


	As of December 31, 2019
	12 months or less				Longer than 12 months				Total
			Unrealized				Unrealized				Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
U.S. Treasury securities and obligations of U.S. Government	$	—	$	—	$	5,513	$	(3)	$	5,513	$	(3)
Corporate bonds		27,268		(144)		1,150		(19)		28,418		(163)
Collateralized corporate bank loans		9,000		(41)		10,228		(427)		19,228		(468)
Municipal bonds		4,808		(29)		1,618		(19)		6,426		(48)
Mortgage-backed		1,712		(101)		562		(118)		2,274		(219)
Total debt securities		42,788		(315)		19,071		(586)		61,859		(901)
Total equity securities		10,905		(2,363)		6,093		(5,345)		16,998		(7,708)
Total other investments		—		—		2,169		(1,594)		2,169		(1,594)
Total investments	$	53,693	$	(2,678)	$	27,333	$	(7,525)	$	81,026	$	(10,203)


	As of December 31, 2018
	12 months or less				Longer than 12 months				Total
			Unrealized				Unrealized				Unrealized
	Fair Value		Losses		Fair Value		Losses		Fair Value		Losses
U.S. Treasury securities and obligations of U.S. Government	$	18,902	$	(181)	$	28,201	$	(327)	$	47,103	$	(508)
Corporate bonds		117,450		(907)		100,060		(695)		217,510		(1,602)
Collateralized corporate bank loans		120,410		(4,938)		4,931		(332)		125,341		(5,270)
Municipal bonds		14,281		(96)		25,891		(742)		40,172		(838)
Mortgage-backed		6,592		(60)		5,986		(386)		12,578		(446)
Total debt securities		277,635		(6,182)		165,069		(2,482)		442,704		(8,664)
Total equity securities		30,981		(3,699)		4,475		(4,807)		35,456		(8,506)
Total other investments		1,148		(2,615)		—		—		1,148		(2,615)
Total investments	$	309,764	$	(12,496)	$	169,544	$	(7,289)	$	479,308	$	(19,785)

We held a total of 61 debt securities with an unrealized loss, of which 41 were in an unrealized loss position for less than one year and 20 were in an unrealized loss position for a period of one year or greater, as of December 31, 2019. We held a total of 328 debt securities with an unrealized loss, of which 221 were in an unrealized loss position for less than one year and 107 were in an unrealized loss position for a period of one year or greater, as of December 31, 2018. We held a total of 9 equity securities with an unrealized loss, of which 7 were in an unrealized loss position for less than one year and 2 were in an unrealized loss position for a period of one year or greater, as of December 31, 2019. We held a total of 20 equity securities with an unrealized loss, of which 17 were in an unrealized loss position for less than one year and 3 were in an unrealized loss position for a period of one year or greater, as of December 31, 2018. We consider these losses as a temporary decline in value as they are predominately on securities that we do not intend to sell and do not believe we will be required to sell prior to recovery of our amortized cost basis. The gross unrealized losses on the debt security positions at December 31, 2019 were due predominately to normal market and interest rate fluctuations and we see no other indications that the decline in values of these securities is other-than-temporary.

Based on evidence gathered through our normal credit evaluation process, we presently expect that all debt securities held in our investment portfolio will be paid in accordance with their contractual terms. Nonetheless, it is at least reasonably possible that the performance of certain issuers of these debt securities will be worse than currently expected resulting in future write-downs within our portfolio of debt securities.

Also, as a result of the challenging market conditions, we expect the volatility in the valuation of our equity securities to continue in the foreseeable future. This volatility may lead to changes regarding retention strategies for certain equity securities.

We complete a detailed analysis each quarter to assess whether any decline in the fair value of any debt security below cost is deemed other-than-temporary. All debt securities with an unrealized loss are reviewed. We recognize an impairment loss when a debt security’s value declines below cost, adjusted for accretion, amortization and previous other-than-temporary impairments and it is determined that the decline is other-than-temporary. We did not recognize an impairment loss during 2019 and 2018.

Debt Investments: We assess whether we intend to sell, or it is more likely than not that we will be required to sell, a fixed maturity investment before recovery of its amortized cost basis less any current period credit losses. For fixed maturity investments that are considered other-than-temporarily impaired and that we do not intend to sell and will not be required to sell, we separate the amount of the impairment into the amount that is credit related (credit loss component) and the amount due to all other factors. The credit loss component is recognized in earnings and is the difference between the investment’s amortized cost basis and the present value of its expected future cash flows. The remaining difference between the investment’s fair value and the present value of future expected cash flows is recognized in other comprehensive income. During 2019 we disposed of six previously impaired securities and recognized a realized gain of $4.1 million. During 2018 we sold one previously impaired security with a realized loss of $0.1 million and recognized a change in unrealized gain of $1.8 million on the remaining securities.

Equity Investments: On January 1, 2018, we adopted ASU 2016-01, “Recognition and Measurement of Financial Assets and Financial Liabilities”. ASU 2016-01 requires equity investments that are not consolidated or accounted for under the equity method of accounting to be measured at fair value with changes in fair value recognized in net income each reporting period. As a result of the new standard, equity securities with readily determinable fair values are no longer required to be evaluated for other-than-temporary-impairment.

Details regarding the carrying value of the other invested assets portfolio as of December 31, 2019 and 2018 were as follows:


	December 31,		December 31,
	2019		2018
Investment Type
Equity warrant	$	2,169	$	1,148
Total other investments	$	2,169	$	1,148

We acquired this equity warrant in an active market and it entitles us to buy the underlying common stock of a publicly traded company at a fixed exercise price until the expiration date of January 19, 2021.

The amortized cost and estimated fair value of debt securities at December 31, 2019 by contractual maturity are as follows. Expected maturities may differ from contractual maturities because certain borrowers may have the right to call or prepay obligations with or without penalties.


	Amortized Cost		Fair Value
	(in thousands)
Due in one year or less	$	107,108	$	107,605
Due after one year through five years		342,962		345,860
Due after five years through ten years		87,669		88,061
Due after ten years		23,760		24,926
Mortgage-backed		7,999		7,827
	$	569,498	$	574,279

We have certain of our securities pledged for the benefit of various state insurance departments and reinsurers. These securities are included with our available-for-sale debt securities because we have the ability to trade these securities. We retain the interest earned on these securities. These securities had a carrying value of $28.9 million at December 31, 2019 and a carrying value of $29.5 million at December 31, 2018.