Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Summary of income tax assets and liabilities

The income tax assets and liabilities included in Other assets and Other liabilities, respectively, in the Consolidated Balance Sheets were as follows:



($ in thousands)	December 31,
	2018			2017
Income tax (asset) liability
Current	$	(20,793	)	$	(16,266	)
Deferred	103,686			157,775

Summary of deferred tax assets and liabilities

The "temporary differences" that gave rise to the deferred tax balances were as follows:



($ in thousands)	December 31,
	2018		2017
Deferred tax assets
Unearned premium reserve reduction	$	12,112	$	11,472
Compensation accruals	6,866		8,359
Impaired securities	1,295		2,240
Other comprehensive income - net funded status of benefit plans	3,254		3,526
Discounting of unpaid claims and claim expense tax reserves	2,772		3,889
Postretirement benefits other than pensions	302		321
Charitable contributions carryforwards	89		62
Net operating loss carryforwards	10,969		148
Total gross deferred tax assets	37,659		30,017
Deferred tax liabilities
Other comprehensive income - net unrealized gains on securities	32,897		95,583
Deferred policy acquisition costs	60,330		52,438
Life insurance future policy benefit reserve	9,304		102
Life insurance future policy benefit reserve (transitional rule)	14,910		23,869
Discounting of unpaid claims and claim expense tax reserves (transitional rule)	1,203		2,513
Investment related adjustments	17,531		8,661
Intangibles	2,557		2,557
Other, net	2,613		2,069
Total gross deferred tax liabilities	141,345		187,792
Net deferred tax liability	$	103,686	$	157,775

Summary of Loss Carryforwards and Credits

At December 31, 2018, the Company had available the following carryforwards or credits.

Income Taxes Expenses

The components of the provision for income tax expense were as follows:



($ in thousands)	Years Ended December 31,
	2018			2017			2016

Current	$	4,152		$	3,813		$	26,359
Deferred	(2,958		)	(84,585		)	4,108
Total income tax expense (benefit)	$	1,194		$	(80,772	)	$	30,467

Income Taxes Expenses Reconciliation

Income tax expense for the following periods differed from the expected tax computed by applying the federal corporate tax rate of 21% for 2018 and 35% for 2017 and 2016 to income before income taxes as follows:



($ in thousands)	Years Ended December 31,
	2018			2017			2016

Expected federal tax on income	$	4,103		$	31,041		$	39,981
Add (deduct) tax effects of:
Tax-exempt interest	(3,726		)	(5,335		)	(5,789		)
Dividend received deduction	(412		)	(4,810		)	(5,751		)
Tax Act DTL re-measurement	—			(98,988		)	—
Employee share-based compensation	(1,134		)	(3,258		)	127
Compensation deduction limitation	1,754			326			—
Prior year adjustments	300			(293		)	91
Other, net	309			545			1,808
Income tax expense (benefit) provided on income	$	1,194		$	(80,772	)	$	30,467

Unrecognized tax benefits, excluding interest and penalties

A reconciliation of the beginning and ending amounts of unrecognized tax benefits, excluding interest and penalties, is as follows:



($ in thousands)	Years Ended December 31,
	2018			2017			2016

Balance as of the beginning of the year	$	1,790		$	1,594		$	1,039
Increases related to prior year tax positions	—			101			348
Decreases related to prior year tax positions	(152		)	—			—
Increases related to current year tax positions	96			422			283
Settlements	—			—			—
Lapse of statute	—			(327		)	(76		)
Balance as of the end of the year	$	1,734		$	1,790		$	1,594

($ in thousands)

Pretax Amount

Expiration Years

Operating loss carryforwards

Charitable contributions carryforwards