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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 June 30, 2020
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 000-19289
STATE AUTO FINANCIAL CORPORATION
(Exact name of Registrant as specified in its charter)
Ohio 31-1324304
(State or other jurisdiction of
incorporation or organization)
 (I.R.S. Employer
Identification No.)
518 East Broad StreetColumbusOhio43215-3976
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (614464-5000
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading symbolName of each exchange on which registered
Common shares, without par valueSTFCThe NASDAQ Global Select Market
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  ý    No   ¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes  ý    No   ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
Accelerated filer
x
Non-accelerated filer
Smaller reporting company
(Do not check if a 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   ý
On July 31, 2020, the Registrant had 43,837,768 Common Shares outstanding.


Index to Form 10-Q Quarterly Report for the three and six month periods ended June 30, 2020
Item 1.
Item 2.
Item 3.
Item 4.
Item 1.
Item 1A.
Item 2.
Item 4.
Item 5.
Item 6.


STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
PART I – FINANCIAL STATEMENTS
Item 1. Condensed Consolidated Balance Sheets
($ and shares in millions, except per share amounts)June 30, 2020December 31, 2019
(unaudited)
Assets
Fixed maturities, available-for-sale, at fair value (amortized cost $1,983.5 and $2,080.0, respectively)$2,097.9  $2,127.9  
Equity securities354.6  395.2  
Other invested assets60.4  69.7  
Other invested assets, at cost12.5  6.5  
Notes receivable from affiliate70.0  70.0  
Total investments2,595.4  2,669.3  
Cash and cash equivalents174.6  78.0  
Accrued investment income and other assets31.1  31.7  
Deferred policy acquisition costs (affiliated net assumed $24.8 and $20.2, respectively)120.0  111.1  
Reinsurance recoverable on losses and loss expenses payable36.4  13.6  
Prepaid reinsurance premiums8.5  7.5  
Due from affiliate54.1  21.5  
Current federal income taxes6.7  6.3  
Net deferred federal income taxes49.2  42.2  
Property and equipment, held for sale4.2  4.2  
Total assets$3,080.2  $2,985.4  
Liabilities and Stockholders’ Equity
Losses and loss expenses payable (affiliated net assumed $461.4 and $500.8, respectively)$1,105.3  $1,066.5  
Unearned premiums (affiliated net assumed $144.2 and $116.7, respectively)705.8  649.2  
Notes payable (affiliates $15.3 and $15.2, respectively)182.1  122.0  
Pension and postretirement benefits61.4  72.9  
Other liabilities (affiliated net assumed $12.7 and $19.5, respectively)95.1  114.9  
Total liabilities2,149.7  2,025.5  
Stockholders’ equity:
Class A Preferred stock (nonvoting), without par value. Authorized 2.5 shares; none issued    
Class B Preferred stock, without par value. Authorized 2.5 shares; none issued    
Common stock, without par value. Authorized 100.0 shares; 50.7 and 50.4 shares issued, respectively, at stated value of $2.50 per share126.7  125.9  
Treasury stock, 6.9 and 6.9 shares, respectively, at cost(118.4) (117.5) 
Additional paid-in capital211.1  206.7  
Accumulated other comprehensive income (loss)17.9  (37.9) 
Retained earnings693.2  782.7  
Total stockholders’ equity930.5  959.9  
Total liabilities and stockholders’ equity$3,080.2  $2,985.4  
See accompanying notes to condensed consolidated financial statements.
1

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Condensed Consolidated Statements of Income
($ in millions, except per share amounts)Three months ended June 30
(unaudited)20202019
Earned premiums (affiliated net assumed $61.6 and $53.1, respectively)$340.7  $307.7  
Net investment income (affiliates $0.7 and $0.4, respectively)17.7  21.7  
Net investment gain75.9  10.3  
Other income from affiliates0.5  0.4  
Total revenues434.8  340.1  
Losses and loss expenses (affiliated net assumed $73.2 and $50.0, respectively)271.2  234.9  
Acquisition and operating expenses (affiliated net assumed $21.0 and $12.7, respectively)119.5  107.9  
Interest expense (affiliates $0.3 and $0.3, respectively)1.3  1.3  
Other expenses1.2  3.6  
Total expenses393.2  347.7  
Income (loss) before federal income taxes41.6  (7.6) 
Federal income tax expense (benefit):
Current(0.4)   
Deferred7.7  (1.4) 
Total federal income tax expense (benefit)7.3  (1.4) 
Net income (loss)$34.3  $(6.2) 
Earnings (loss) per common share:
Basic$0.78  $(0.14) 
Diluted$0.74  $(0.14) 
Dividends paid per common share$0.10  $0.10  
See accompanying notes to condensed consolidated financial statements.
2

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Condensed Consolidated Statements of Income
($ in millions, except per share amounts)Six months ended June 30
(unaudited)20202019
Earned premiums (affiliated net assumed $119.9 and $112.8, respectively)$671.2  $610.4  
Net investment income (affiliates $1.4 and $1.6, respectively)36.6  41.1  
Net investment (loss) gain(59.3) 55.2  
Other income from affiliates1.1  1.0  
Total revenues649.6  707.7  
Losses and loss expenses (affiliated net assumed $84.1 and $100.9, respectively)510.6  429.2  
Acquisition and operating expenses (affiliated net assumed $41.9 and $36.9, respectively)234.4  215.5  
Interest expense (affiliates $0.5 and $0.5, respectively)2.5  2.5  
Other expenses4.5  6.5  
Total expenses752.0  653.7  
(Loss) income before federal income taxes(102.4) 54.0  
Federal income tax (benefit) expense:
Current(0.4) (0.4) 
Deferred(21.7) 11.2  
Total federal income tax (benefit) expense(22.1) 10.8  
Net (loss) income$(80.3) $43.2  
(Loss) earnings per common share:
Basic$(1.83) $1.00  
Diluted$(1.83) $1.00  
Dividends paid per common share$0.20  $0.20  


See accompanying notes to condensed consolidated financial statements.
3

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Consolidated Statements of Comprehensive Income
($ in millions, except per share amounts)Three months ended June 30
(unaudited)20202019
Net income (loss)$34.3  $(6.2) 
Other comprehensive income, net of tax:
Net unrealized holding gains on available-for-sale investments:
Unrealized holding gains38.9  34.7  
Reclassification adjustments for gains realized in net income(1.0) (1.5) 
Income tax expense(7.9) (7.0) 
Total net unrealized holding gains on available-for-sale investments30.0  26.2  
Net unrecognized benefit plan obligations:
Reclassification adjustments for amortization to statements of income:
Negative prior service cost(1.6) (1.6) 
Net actuarial loss3.6  2.4  
Income tax expense
(0.4) (0.1) 
Total net unrecognized benefit plan obligations1.6  0.7  
Other comprehensive income31.6  26.9  
Comprehensive income$65.9  $20.7  

See accompanying notes to condensed consolidated financial statements.
4

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Consolidated Statements of Comprehensive (Loss) Income
($ in millions, except per share amounts)Six months ended June 30
(unaudited)20202019
Net (loss) income$(80.3) $43.2  
Other comprehensive income, net of tax:
Net unrealized holding gains on fixed available-for-sale investments:
Unrealized holding gains69.9  69.2  
Reclassification adjustments for gains realized in net income(3.4) (1.6) 
Income tax expense(13.9) (14.2) 
Total net unrealized holding gains on available-for-sale investments52.6  53.4  
Net unrecognized benefit plan obligations:
Reclassification adjustments for amortization to statements of income:
Negative prior service cost(3.2) (3.2) 
Net actuarial loss7.3  4.8  
Income tax expense
(0.9) (0.3) 
Total net unrecognized benefit plan obligations3.2  1.3  
Other comprehensive income55.8  54.7  
Comprehensive (loss) income$(24.5) $97.9  
See accompanying notes to condensed consolidated financial statements.
5

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Condensed Consolidated Statements of Stockholders’ Equity
(in millions)Three months ended June 30
20202019
Common shares:
Balance at beginning of period50.6  50.1  
Issuance of shares0.1  0.2  
Balance at June 3050.7  50.3  
Treasury shares:
Balance at beginning of period(6.9) (6.8) 
Balance at June 30(6.9) (6.8) 
Common stock:
Balance at beginning of period$126.5  $125.3  
Issuance of shares0.2  0.4  
Balance at June 30$126.7  $125.7  
Treasury stock:
Balance at beginning of period$(118.4) $(117.5) 
Balance at June 30$(118.4) $(117.5) 
Additional paid-in capital:
Balance at beginning of period$209.1  $198.4  
Issuance of common stock0.9  2.6  
Stock awards granted1.1  1.5  
Balance at June 30$211.1  $202.5  
Accumulated other comprehensive income (loss):
Balance at beginning of period$(13.7) $(68.6) 
Change in net unrealized holding gains on available-for-sale investments30.0  26.2  
Total net unrecognized benefit plan obligations1.6  0.7  
Balance at June 30$17.9  $(41.7) 
Retained earnings:
Balance at beginning of period$663.2  $757.7  
Net income (loss)34.3  (6.2) 
Dividends declared (affiliates $2.6 and $2.6, respectively)$(4.3) $(4.3) 
Balance at June 30693.2  747.2  
Total stockholders’ equity at June 30$930.5  $916.2  
See accompanying notes to condensed consolidated financial statements.
6

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Condensed Consolidated Statements of Stockholders’ Equity
(in millions)Six months ended June 30
20202019
Common shares:
Balance at beginning of year50.4  50.0  
Issuance of shares0.3  0.3  
Balance at June 3050.7  50.3  
Treasury shares:
Balance at beginning of year(6.9) (6.8) 
Balance at June 30(6.9) (6.8) 
Common stock:
Balance at beginning of year$125.9  $125.0  
Issuance of shares0.8  0.7  
Balance at June 30$126.7  $125.7  
Treasury stock:
Balance at beginning of year$(117.5) $(117.0) 
Shares acquired on stock award exercises and vested restricted shares(0.9) (0.5) 
Balance at June 30$(118.4) $(117.5) 
Additional paid-in capital:
Balance at beginning of year$206.7  $194.2  
Issuance of common stock2.2  3.3  
Stock awards granted2.2  5.0  
Balance at June 30$211.1  $202.5  
Accumulated other comprehensive income (loss):
Balance at beginning of year$(37.9) $(96.4) 
Change in net unrealized holding gains on available-for-sale investments52.6  53.4  
Change in unrecognized benefit plan obligations, net of tax3.2  1.3  
Balance at June 30$17.9  $(41.7) 
Retained earnings:
Balance at beginning of year$782.7  $712.7  
Cumulative effect of change in accounting to establish an allowance for expected credit losses at January 1, 2020(0.5)   
Net (loss) income(80.3) 43.2  
Dividends declared (affiliates $5.2 and $5.2, respectively)$(8.7) $(8.7) 
Balance at June 30693.2  747.2  
Total stockholders’ equity at June 30$930.5  $916.2  
See accompanying notes to condensed consolidated financial statements.
7

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Condensed Consolidated Statements of Cash Flows
($ in millions)Six months ended June 30
(unaudited)20202019
Cash flows from operating activities:
Net (loss) income$(80.3) $43.2  
Adjustments to reconcile net income to net cash (used in) provided by operating activities:
Depreciation and amortization, net5.7  3.8  
Share-based compensation(0.5) 4.4  
Net investment loss (gain)59.3  (55.2) 
Changes in operating assets and liabilities:
Deferred policy acquisition costs(8.9) (7.2) 
Accrued investment income and other assets0.6  1.8  
Postretirement and pension benefits(10.5) (11.3) 
Other liabilities and due to/from affiliates, net(46.5) (79.1) 
Reinsurance recoverable on losses and loss expenses payable and prepaid reinsurance premiums(23.8) (3.4) 
Losses and loss expenses payable38.2  (11.6) 
Unearned premiums56.6  37.4  
Deferred tax on share-based awards(0.2) (0.6) 
Federal income taxes(21.9) 11.4  
Net cash used in operating activities(32.2) (66.4) 
Cash flows from investing activities:
Purchases of fixed maturities available-for-sale(280.8) (334.8) 
Purchases of equity securities(42.7) (30.4) 
Purchases of other invested assets(6.9) (2.6) 
Maturities, calls and pay downs of fixed maturities available-for-sale186.7  203.2  
Sales of fixed maturities available-for-sale188.3  198.7  
Sales of equity securities30.0  20.3  
Sales of other invested assets0.6  0.6  
Disposals of property and equipment0.2  1.6  
Net cash provided by investing activities75.4  56.6  
Cash flows from financing activities:
Proceeds from issuance of common stock3.0  4.0  
Payments to acquire treasury stock(0.9) (0.5) 
Payment of dividends(8.7) (8.7) 
Proceeds from short-term debt60.0    
Net cash provided by (used in) financing activities53.4  (5.2) 
Net increase (decrease) in cash and cash equivalents96.6  (15.0) 
Cash and cash equivalents at beginning of period78.0  59.8  
Cash and cash equivalents at end of period$174.6  $44.8  
Supplemental disclosures:
Interest paid (affiliates $0.5 and $0.5, respectively)$2.3  $2.3  
See accompanying notes to condensed consolidated financial statements.
8

STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Notes to Condensed Consolidated Financial Statements (Unaudited)

1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of State Auto Financial Corporation and Subsidiaries (“State Auto Financial” or the “Company”) have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements. In the opinion of the Company, all adjustments (consisting of normal, recurring accruals) considered necessary for a fair statement have been included. Operating results for the three and six months ended June 30, 2020, are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The balance sheet at December 31, 2019, has been derived from the audited financial statements at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements.
For further information, refer to the consolidated financial statements and footnotes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “2019 Form 10-K”). Capitalized terms used herein and not otherwise defined shall have the meaning ascribed to them in the 2019 Form 10-K.
The COVID-19 pandemic has caused an economic downturn on a global scale, including temporary closures of many businesses and reduced consumer spending due to shelter-in-place and other governmental regulations, as well as significant market disruption and volatility. The scope, duration and magnitude of the effects of COVID-19 continue to evolve rapidly and in ways that are difficult or impossible to anticipate. The Company cannot, at this time, predict the impact the pandemic will have on its future consolidated financial position, cash flows or results of operations, however, the impact could be material. The Company's future financial results and operations depend in part on the duration and severity of the pandemic and what actions are taken to mitigate the outbreak.
Adoption of Recent Accounting Pronouncements
Measurement of Credit Losses on Financial Instruments
On January 1, 2020, the Company adopted ASU 2016-13 Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments, which replaces the incurred loss methodology with an expected loss methodology that is referred to as the current expected credit loss (CECL) methodology. The measurement of expected credit losses under the CECL methodology is applicable to financial assets measured at amortized cost. This includes the Company's direct third party reinsurance recoverables, and the Company's share of the State Auto Group's third party reinsurance recoverables assumed via the Pooling Arrangement. In addition, ASC 326 made changes to the accounting for available-for-sale fixed maturities. One such change is to require credit losses to be presented as an allowance rather than as a write-down on available-for-sale fixed maturities management does not intend to sell or believes that it is more likely than not they will not be required to sell.
The adoption of this guidance reduced retained earnings by $0.5 million, net of tax, and established an allowance for estimated uncollectible reinsurance as of January 1, 2020. Adoption of ASC 326 for available-for-sale fixed maturities was prospective, and therefore there was no adjustment to retained earnings as of January 1, 2020. Changes to the Company's accounting policy resulting from the adoption of the guidance are discussed below.
Disclosure Framework—Changes to the Disclosure Requirements for Fair Value Measurement
In August 2018, the FASB issued ASU 2018-13 which changes the fair value measurement disclosure requirements of ASC 820 by adding, eliminating and modifying disclosures. The new guidance eliminates (i) the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, (ii) the entity's policy for the timing of transfers between levels, and (iii) the entity's valuation process for Level 3 fair value measurements. Additionally, the guidance now requires the disclosure of (i) the changes in unrealized gains and losses in other comprehensive income for recurring Level 3 fair value measurements, and (ii) the range and weighted average used to develop significant unobservable inputs and how the weighted average was calculated for Level 3 fair value measurements. Finally, the guidance requires entities to provide information about the measurement uncertainty of Level 3 fair value measurements as of the reporting date rather than a point in the future. The guidance became effective for annual reporting periods after December 15, 2019 and it did not have a material impact on the Company's results of operations, consolidated financial position or cash flows.
9


STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Notes to Condensed Consolidated Financial Statements, Continued (Unaudited)
Pending Adoption of Recent Accounting Pronouncements
Income Taxes - Simplifying the Accounting for Income Taxes
In December 2019, the FASB issued ASU 2019-12 which updated guidance for the accounting for income taxes. The updated guidance is intended to simplify the accounting for income taxes by removing several exceptions contained in existing guidance and amending other existing guidance to simplify several other income tax accounting matters. The effective date of ASU 2019-12 is for interim and annual periods beginning after December 15, 2020. Early adoption is permitted. The ASU has not yet been adopted; however, it is not expected to have a material impact on the Company’s results of operations, consolidated financial position or cash flows.
For information regarding other accounting pronouncements that the Company has not yet adopted, see the “Pending Adoption of Recent Accounting Pronouncements” section of Note 1 of the Notes to Consolidated Financial Statements in the 2019 Form 10-K.
Significant Accounting Policy Updates
The following accounting policies have been updated to reflect the Company's adoption of ASU 2016-13 Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments as described above.
Investments
Investments in fixed maturities are classified as available-for-sale and are carried at fair value. For fixed maturities in an unrealized loss position, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by a rating agency, and adverse conditions specifically related to the security, among other factors. If this assessment indicates that a credit loss exists, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that the fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income.
Changes in the allowance for credit losses are recorded in the "net investment gain (loss)" line item on the condensed consolidated statement of income. Losses are charged against the allowance when management believes the uncollectibility of a fixed maturity is confirmed or when either of the criteria regarding intent or requirement to sell is met. Description and disclosure of credit losses on fixed maturities are disclosed in Note 2 of the Notes to Condensed Consolidated Financial Statements.
The Company excludes accrued interest receivable from both the estimated fair value and the amortized cost basis of available-for-sale fixed maturities and includes such amounts within "accrued investment income and other assets" on the Company's condensed consolidated balance sheets. Any uncollectible accrued interest receivable is written off in the period it is deemed uncollectible.
Reinsurance Recoverables
Management assesses expected credit losses on third party reinsurance recoverables for the entire State Auto Pool and, pursuant to the Pooling Arrangement (as defined in Note 6), the Company is responsible for its share of the estimated uncollectible reinsurance for the entire pool. Management uses A.M. Best’s Financial Strength ratings or equivalent such as S&P, Moody’s, or Fitch when an A.M. Best Financial Strength rating is not available to assess the credit risk of the reinsurance recoverables. The estimate of expected credit losses considers historical credit loss information as well as current conditions and reasonable and supportable forecasts. Description and disclosure of credit losses on reinsurance recoverables are disclosed in Note 6 of the Notes to Condensed Consolidated Financial Statements.
Premiums
Premiums are recognized as earned pro rata over the policy period. Unearned premiums represent the portion of premiums written relative to the unexpired terms of coverage.
Under the terms of the Pooling Arrangement, State Auto Mutual receives all premiums and pays all losses and expenses associated with the insurance business produced by the STFC Pooled Companies and the other pool participants, and then it settles the intercompany balances generated by these transactions with the pool participants within 60 days following each quarter end. When settling the intercompany balances, State Auto Mutual provides the pool participants with full credit for their
10


STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Notes to Condensed Consolidated Financial Statements, Continued (Unaudited)
share of the Pooled Companies net premiums written during the quarter, retaining all premium receivable amounts from insureds and agents.
Management utilizes an aging schedule to estimate an allowance for uncollectible amounts relating to the State Auto Group’s premiums receivable balance. Current and historical collection experience along with reasonable and supportable forecasts are used to estimate the percentage of the premiums receivable balance that will be uncollectible. Credit risk is partially mitigated by the State Auto Group's ability to cancel the policy if the policyholder does not pay the premium. Pursuant to the Pooling Arrangement, bad debt expense for uncollectible premiums receivable is allocated to pool members on the basis of pool participation and is included in the quarterly settlement of intercompany balances. This is included in "other expenses" on the condensed consolidated statements of income and reflected in “due to/from affiliates” on the Company's condensed consolidated balance sheets. The Company’s share of the premium balances due to State Auto Mutual from agents and insureds at June 30, 2020 and December 31, 2019 is approximately $404.0 million and $371.0 million, respectively, net of the allowance for uncollectible premiums receivable of $7.0 million and $4.3 million, respectively.
2. Investments
The following tables set forth the amortized cost and fair value of investments by investment category at June 30, 2020 and December 31, 2019:
($ millions)Amortized cost Gross unrealized holding gainsGross unrealized holding lossesFair value
June 30, 2020
Available-for-sale fixed maturities:
U.S. treasury securities and obligations of U.S. government agencies$518.9  $43.6  $  $562.5  
Obligations of states and political subdivisions391.5  25.7    417.2  
Corporate securities493.5  20.2  (0.3) 513.4  
U.S. government agencies mortgage-backed securities579.6  26.7  (1.5) 604.8  
Total available-for-sale fixed maturities$1,983.5  $116.2  $(1.8) $2,097.9  
($ millions)Amortized costGross unrealized holding gainsGross unrealized holding lossesFair value
December 31, 2019
Available-for-sale fixed maturities:
U.S. treasury securities and obligations of U.S. government agencies$569.2  $12.3  $(3.3) $578.2  
Obligations of states and political subdivisions404.3  21.1    425.4  
Corporate securities460.5  11.7  (0.4) 471.8  
U.S. government agencies mortgage-backed securities646.0  11.1  (4.6) 652.5  
Total available-for-sale fixed maturities$2,080.0  $56.2  $(8.3) $2,127.9  
11


STATE AUTO FINANCIAL CORPORATION AND SUBSIDIARIES
(a majority-owned subsidiary of State Automobile Mutual Insurance Company)
Notes to Condensed Consolidated Financial Statements, Continued (Unaudited)
The following tables set forth the Company’s gross unrealized losses and fair value on its investments by lot, aggregated by investment category and length of time for individual securities that have been in a continuous unrealized loss position for which an allowance for credit losses has not been recorded at June 30, 2020:
($ millions, except # of positions)Less than 12 months12 months or moreTotal
Fair valueUnrealized lossesNumber of positionsFair valueUnrealized lossesNumber of positionsFair valueUnrealized lossesNumber of positions
June 30, 2020
Fixed maturities:
U.S. treasury securities and obligations of U.S. government agencies$3.0  $  2  $  $    $3.0  $  2  
Corporate securities94.6  (0.3) 16    $    94.6  $(0.3) 16  
U.S. government agencies mortgage-backed securities77.6  (1.3) 18  15.6  (0.2) 4  93.2  (1.5) 22  
Total temporarily impaired securities$175.2  $(1.6) 36  $15.6  $(0.2) 4  $190.8  $(1.8) 40  
The following tables set forth the Company’s gross unrealized losses and fair value on its investments by lot, aggregated by investment category and length of time for individual securities that have been in a continuous unrealized loss position at December 31, 2019:
($ millions, except # of positions)Less than 12 months12 months or moreTotal
Fair valueUnrealized lossesNumber of positionsFair valueUnrealized lossesNumber of positionsFair valueUnrealized lossesNumber of positions
December 31, 2019
Fixed maturities:
U.S. treasury securities and obligations of U.S. government agencies$136.0  $(2.5) 17$157.6  $(0.8) 11  $293.6  $(3.3) 28
Corporate securities