
Details of fixed income investment securities by category as of December 31, 2021
Table	5.1a
(In thousands)		Amortized Cost		Allowance for Expected Credit Loss		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury securities and obligations of U.S. government corporations and agencies		$	133,990	$	—	$	285	$	(868)	$	133,407
Obligations of U.S. states and political subdivisions		2,408,688		—		133,361		(7,396)		2,534,653
Corporate debt securities		2,704,586		—		75,172		(13,776)		2,765,982
ABS		150,888		—		830		(1,008)		150,710
RMBS		309,991		—		2,397		(3,278)		309,110
CMBS		315,330		—		5,736		(1,936)		319,130
CLOs		360,436		—		609		(106)		360,939
Foreign government debt		13,749		—		—		(99)		13,650

Total fixed income securities		$	6,397,658	$	—	$	218,390	$	(28,467)	$	6,587,581


Details of fixed income investment securities by category as of December 31, 2020
Table	5.1b
(In thousands)		Amortized Cost		Allowance for Expected Credit Loss		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury securities and obligations of U.S. government corporations and agencies		$	264,531	$	—	$	1,164	$	(2)	$	265,693
Obligations of U.S. states and political subdivisions		2,083,568		—		166,557		(256)		2,249,869
Corporate debt securities		2,690,860		—		155,156		(1,728)		2,844,288
ABS		203,807		(49)		2,946		(18)		206,686
RMBS		425,532		—		6,472		(838)		431,166
CMBS		312,572		—		16,055		(1,125)		327,502
CLOs		310,616		—		566		(692)		310,490
Foreign government debt		4,485		—		224		—		4,709
Commercial paper		21,193		—		—		—		21,193
Total fixed income securities		$	6,317,164	$	(49)	$	349,140	$	(4,659)	$	6,661,596

The decrease in gross unrealized gains and the increase in gross unrealized losses in our fixed income securities from December 31, 2020 to December 31, 2021 were principally related to an increase in market yields which may include increased risk-free interest rates or wider credit spreads since the time of initial purchase.

We had $13.4 million and $14.1 million of investments at fair value on deposit with various states as of December 31, 2021 and 2020, respectively, due to regulatory requirements of those states' insurance departments. In connection with our insurance and reinsurance activities within insurance subsidiaries of MGIC, we are required to maintain assets in trusts for the benefit of contractual counterparties. The fair value of the investments and restricted cash and cash equivalents on deposit in these trusts was $189.8 million and $165.9 million at December 31, 2021 and 2020, respectively.

Table 5.2 compares the amortized cost and fair values of fixed income securities, by contractual maturity, as of December 31, 2021. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Because most mortgage and asset-backed securities provide for periodic payments throughout their lives, they are listed in separate categories.


Fixed income securities maturity schedule
Table	5.2
		December 31, 2021
(In thousands)		Amortized Cost		Fair Value
Due in one year or less		$	338,988	$	341,604
Due after one year through five years		1,751,297		1,795,249
Due after five years through ten years		1,745,569		1,824,307
Due after ten years		1,425,159		1,486,532
		5,261,013		5,447,692

ABS		150,888		150,710
RMBS		309,991		309,110
CMBS		315,330		319,130
CLOs		360,436		360,939
Total as of December 31, 2021		$	6,397,658	$	6,587,581

Proceeds from sales of fixed income securities classified as available-for-sale were $471.8 million, $803.4 million, and $228.1 million during the years ended December 31, 2021, 2020, and 2019, respectively. Gross gains of $9.0 million, $21.3 million, and $7.1 million and gross losses of $1.9 million, $8.8 million, and $3.5 million were realized on those sales during the years ended December 31, 2021, 2020, and 2019, respectively.

We recorded no realized losses for the year ended December 31, 2021 related to our intent to sell certain securities. We recorded $0.3 million of realized losses for the year ended December 31, 2020 related to our intent to sell certain securities. We also recorded a credit allowance of $49 thousand for the year ended December 31, 2020.

Proceeds from the sale of equity securities were $2.6 million, $25.7 million, and $1.7 million during the years ended December 31, 2021 2020, and 2019, respectively. Gross gains of $6.0 thousand, $1.8 million, and $1.6 million were realized on those sales during the year ended December 31, 2021, 2020, and 2019, respectively. Gross losses of $2.3 thousand, $0.4 million, and zero were realized on those sales during the year ended December 31, 2021, 2020, and 2019, respectively. For the year ended December 31, 2021, 2020, and 2019 we recognized $0.5 million in net losses, $0.6 million and $0.2 million of net gains on equity securities still held as of December 31, 2021, 2020, and 2019, respectively, which are reported in Net realized investment gains (losses) on our consolidated statements of operations.

Other invested assets represents our investment in Federal Home Loan Bank ("FHLB") stock that is carried at cost, which due to its nature approximates fair value. Ownership of FHLB stock provides access to a secured lending facility, and our current FHLB Advance amount is secured by eligible collateral whose fair value is maintained at a minimum of 102% of the outstanding principal balance of the FHLB Advance. As of December 31, 2021, that collateral consisted of fixed income securities included in our total investment portfolio, and cash and cash equivalents, with a total fair value of $167.2 million.

Tables 5.4a and 5.4b below summarize, for all available-for-sale investments in an unrealized loss position as of December 31, 2021 and 2020, the aggregate fair value and gross unrealized losses by the length of time those securities have been continuously in an unrealized loss position. Gross unrealized losses on our available-for-sale investments amounted to $28.5 million and $4.7 million as of December 31, 2021 and 2020, respectively. The fair value amounts reported in tables 5.4a and 5.4b below are estimated using the process described in Note 6 - "Fair Value Measurements" to these consolidated financial statements.


Unrealized loss aging for securities by type and length of time as of December 31, 2021
Table	5.4a
		Less Than 12 Months				12 Months or Greater				Total
(In thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. Treasury securities and obligations of U.S. government corporations and agencies		$	91,154	$	(790)	$	2,616	$	(78)	$	93,770	$	(868)
Obligations of U.S. states and political subdivisions		452,021		(7,189)		15,540		(207)		467,561		(7,396)
Corporate debt securities		865,085		(13,260)		10,997		(516)		876,082		(13,776)
ABS		100,064		(998)		1,552		(10)		101,616		(1,008)
RMBS		180,586		(2,548)		31,641		(730)		212,227		(3,278)
CMBS		89,889		(1,887)		1,511		(49)		91,400		(1,936)
CLOs		177,663		(71)		21,973		(35)		199,636		(106)
Foreign government debt		13,649		(99)		—		—		13,649		(99)
Total		$	1,970,111	$	(26,842)	$	85,830	$	(1,625)	$	2,055,941	$	(28,467)


Unrealized loss aging for securities by type and length of time as of December 31, 2020
Table	5.4b
		Less Than 12 Months				12 Months or Greater				Total
(In thousands)		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. Treasury securities and obligations of U.S. government corporations and agencies		$	2,690	$	(2)	$	—	$	—	$	2,690	$	(2)
Obligations of U.S. states and political subdivisions		31,416		(256)		—		—		31,416		(256)
Corporate debt securities		44,968		(1,728)		—		—		44,968		(1,728)
ABS		14,929		(18)		—		—		14,929		(18)
RMBS		98,409		(773)		3,566		(65)		101,975		(838)
CMBS		13,212		(789)		2,799		(336)		16,011		(1,125)
CLOs		95,287		(261)		73,904		(431)		169,191		(692)

Total		$	300,911	$	(3,827)	$	80,269	$	(832)	$	381,180	$	(4,659)

Based on current facts and circumstances, we believe the unrealized losses as of December 31, 2021 presented in table 5.4a above are not indicative of the ultimate collectability of the current amortized cost of the securities and that the securities are not impaired. The gross unrealized losses in all categories of our investments were caused by changes in market yields, between the time of purchase and the respective fair value measurement date. We also rely upon estimates of several credit and non-credit factors in our review and evaluation of individual investments to determine whether a credit impairment exists.

The unrealized losses in all categories of our investments as of December 31, 2020 were primarily attributable to widening credit spreads over risk free rates, as a result of economic and market uncertainties arising from the COVID-19 pandemic, which included demand shocks in multiple sectors that originated in 2020.

There were 610 and 109 securities in an unrealized loss position as of December 31, 2021 and 2020, respectively. As of December 31, 2021, the fair value as a percent of amortized cost of the securities in an unrealized loss position was 99% and approximately 15% of the securities in an unrealized loss position were backed by the U.S. Government. As of December 31, 2020, the fair value as a percent of amortized cost of the securities in an unrealized loss position was 99% and approximately 27% of the securities in an unrealized loss position were backed by the U.S. Government. All of the securities in an unrealized loss position are current with respect to their interest obligations.


Net investment income
Table	5.5
(In thousands)		2021		2020		2019
Fixed income securities		$	160,030	$	157,065	$	165,523
Equity securities		471		620		406
Cash equivalents		75		1,648		4,444
Other		22		275		974
Investment income		160,598		159,608		171,347
Investment expenses		(4,160)		(5,212)		(4,302)
Net investment income		$	156,438	$	154,396	$	167,045

The change in unrealized gains (losses) of investments is shown in table 5.6 below.


Change in unrealized gains (losses)
Table	5.6
(In thousands)		2021		2020		2019
Fixed income securities		$	(154,555)	$	169,135	$	220,139