6.	Investments

The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at December 31, 2014 and 2013 are shown below:

December 31, 2014	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses (1)			Fair Value
	(In thousands)
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	349,153	$	2,752	$	(5,130	)	$	346,775
Obligations of U.S. states and political subdivisions		844,942		12,961		(2,761	)		855,142
Corporate debt securities		2,418,991		16,325		(10,035	)		2,425,281
Asset-backed securities		286,260		535		(140	)		286,655
Residential mortgage-backed securities		329,983		254		(9,000	)		321,237
Commercial mortgage-backed securities		276,215		1,221		(2,158	)		275,278
Collateralized loan obligations		61,340		-		(1,264	)		60,076
Debt securities issued by foreign sovereign governments		35,630		3,540		-			39,170
Total debt securities		4,602,514		37,588		(30,488	)		4,609,614
Equity securities		3,003		61		(9	)		3,055

Total investment portfolio	$	4,605,517	$	37,649	$	(30,497	)	$	4,612,669

December 31, 2013	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses (1)			Fair Value
	(In thousands)
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	663,642	$	1,469	$	(25,521	)	$	639,590
Obligations of U.S. states and political subdivisions		932,922		5,865		(17,420	)		921,367
Corporate debt securities		2,190,095		6,313		(24,993	)		2,171,415
Asset-backed securities		399,839		1,100		(453	)		400,486
Residential mortgage-backed securities		383,368		146		(24,977	)		358,537
Commercial mortgage-backed securities		277,920		131		(6,668	)		271,383
Collateralized loan obligations		61,337		-		(1,042	)		60,295
Debt securities issued by foreign sovereign governments		39,420		1,722		(290	)		40,852
Total debt securities		4,948,543		16,746		(101,364	)		4,863,925
Equity securities		2,908		9		(23	)		2,894

Total investment portfolio	$	4,951,451	$	16,755	$	(101,387	)	$	4,866,819

(1)	There were no other-than-temporary impairment losses recorded in other comprehensive income (loss) at December 31, 2014 and 2013.

Our foreign investments primarily consist of the investment portfolio supporting our Australian domiciled subsidiary. In December 2013, our Australian subsidiary liquidated a portion of its investment portfolio and repatriated, with regulatory approval, $89.5 million to its parent MGIC. The remaining portfolio is comprised of Australian government and semi government securities, representing 86% of the market value of our foreign investments with the remaining 10% invested in corporate securities and 4% in cash equivalents. Eighty-three percent of the Australian portfolio is rated AAA, by one or more of Moody’s, Standard & Poor’s and Fitch Ratings, and the remaining 17% is rated AA. At December 31, 2014 the investment portfolio fair value in our Australian operations was approximately $46 million.

The amortized cost and fair values of debt securities at December 31, 2014, by contractual maturity, are shown below. Expected 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 asset-backed and mortgage-backed securities and collateralized loan obligations provide for periodic payments throughout their lives, they are listed below in separate categories.

December 31, 2014	Amortized Cost		Fair Value
	(In thousands)

Due in one year or less	$	330,602	$	330,982
Due after one year through five years		1,903,661		1,909,422
Due after five years through ten years		1,063,679		1,069,433
Due after ten years		350,774		356,531
		3,648,716		3,666,368

Asset-backed securities		286,260		286,655
Residential mortgage-backed securities		329,983		321,237
Commercial mortgage-backed securities		276,215		275,278
Collateralized loan obligations		61,340		60,076

Total at December 31, 2014	$	4,602,514	$	4,609,614

At December 31, 2014 and 2013, the investment portfolio had gross unrealized losses of $30.5 million and $101.4 million, respectively. For those securities in an unrealized loss position, the length of time the securities were in such a position, as measured by their month-end fair values, is as follows:

	Less Than 12 Months				12 Months or Greater				Total
December 31, 2014	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	58,166	$	138	$	232,351	$	4,992	$	290,517	$	5,130
Obligations of U.S. states and political subdivisions		166,408		1,066		114,465		1,695		280,873		2,761
Corporate debt securities		816,555		5,259		243,208		4,776		1,059,763		10,035
Asset-backed securities		54,491		80		11,895		60		66,386		140
Residential mortgage-backed securities		24,168		34		263,002		8,966		287,170		9,000
Commercial mortgage-backed securities		89,301		810		110,652		1,348		199,953		2,158
Collateralized loan obligations		-		-		60,076		1,264		60,076		1,264
Debt securities issued by foreign sovereign governments		-		-		-		-		-		-
Equity securities		167		1		235		8		402		9
Total investment portfolio	$	1,209,256	$	7,388	$	1,035,884	$	23,109	$	2,245,140	$	30,497

	Less Than 12 Months				12 Months or Greater				Total
December 31, 2013	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
	(In thousands)
U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	465,975	$	24,980	$	4,103	$	541	$	470,078	$	25,521
Obligations of U.S. states and political subdivisions		503,967		17,370		4,226		50		508,193		17,420
Corporate debt securities		1,238,211		20,371		81,593		4,622		1,319,804		24,993
Asset-backed securities		126,991		387		7,114		66		134,105		453
Residential mortgage-backed securities		91,534		3,886		265,827		21,091		357,361		24,977
Commercial mortgage-backed securities		192,440		6,239		43,095		429		235,535		6,668
Collateralized loan obligations		60,295		1,042		-		-		60,295		1,042
Debt securities issued by foreign sovereign governments		7,203		290		-		-		7,203		290
Equity securities		1,012		18		75		5		1,087		23
Total investment portfolio	$	2,687,628	$	74,583	$	406,033	$	26,804	$	3,093,661	$	101,387

The unrealized losses in all categories of our investments at December 31, 2014 were primarily caused by the difference in interest rates at December 31, 2014 compared to interest rates at the time of purchase. There were 423 and 571 securities in an unrealized loss position at December 31, 2014 and 2013, respectively. At December 31, 2014, the fair value as a percent of amortized cost of the securities in an unrealized loss position was 99% and approximately half of the securities in an unrealized loss position were backed by the U.S. Government.

We recognized other-than-temporary impairment (“OTTI”) losses in earnings of $0.1 million and $0.3 million during 2014 and 2013, respectively. During 2012 we recognized OTTI losses in earnings of $2.3 million, related to impairments on certain auction rate securities.

For the years ended December 31, 2014, 2013, and 2012, there were no credit losses recognized in earnings for which a portion of an OTTI loss was recognized in accumulated other comprehensive income (loss).

Net investment income is comprised of the following:

	2014			2013			2012
	(In thousands)

Fixed maturities	$	89,437		$	82,168		$	122,886
Equity securities		227			229			200
Cash equivalents		179			353			333
Other		711			675			782

Investment income		90,554			83,425			124,201
Investment expenses		(2,907	)		(2,686	)		(2,561	)

Net investment income	$	87,647		$	80,739		$	121,640

The net realized investment gains (losses), including impairment losses, and change in net unrealized gains (losses) of investments are as follows:

	2014		2013			2012
	(In thousands)
Net realized investment gains (losses) on investments:
Fixed maturities	$	1,000	$	3,274		$	195,652
Equity securities		356		1,068			487
Other		1		1,389			(730	)

Total net realized investment gains	$	1,357	$	5,731		$	195,409

Change in net unrealized gains (losses):
Fixed maturities	$	91,718	$	(126,020	)	$	(78,604	)
Equity securities		66		(153	)		58
Other		-		-			-
Total increase (decrease) in net unrealized gains/losses	$	91,784	$	(126,173	)	$	(78,546	)

The gross realized gains, gross realized losses and impairment losses are as follows:

	2014			2013			2012
	(In thousands)


Gross realized gains	$	4,966		$	11,043		$	213,827
Gross realized losses		(3,465	)		(4,984	)		(16,108	)
Impairment losses		(144	)		(328	)		(2,310	)

Net realized gains on securities	$	1,357		$	5,731		$	195,409

We had $20.2 million and $20.3 million of investments at fair value on deposit with various states at December 31, 2014 and 2013, respectively, due to regulatory requirements of those state insurance departments.