Note 7 – Investments

The amortized cost, gross unrealized gains and losses and fair value of the investment portfolio at March 31, 2015 and December 31, 2014 are shown below.

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses (1)			Fair Value
March 31, 2015	(In thousands)

U.S. Treasury securities and obligations of U.S. government corporations and agencies	$	312,233	$	2,629	$	(2,057	)	$	312,805
Obligations of U.S. states and political subdivisions		937,548		16,621		(1,466	)		952,703
Corporate debt securities		2,394,862		18,939		(5,785	)		2,408,016
Asset-backed securities		253,185		769		(35	)		253,919
Residential mortgage-backed securities		315,778		719		(7,466	)		309,031
Commercial mortgage-backed securities		259,934		1,804		(1,132	)		260,606
Collateralized loan obligations		61,341		-		(797	)		60,544
Debt securities issued by foreign sovereign governments		32,992		4,047		-			37,039
Total debt securities		4,567,873		45,528		(18,738	)		4,594,663
Equity securities		3,021		85		(6	)		3,100

Total investment portfolio	$	4,570,894	$	45,613	$	(18,744	)	$	4,597,763

	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses (1)			Fair Value
December 31, 2014	(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

(1)	At March 31, 2015 and December 31, 2014, there were no other-than-temporary impairment losses recorded in other comprehensive income.

Our foreign investments primarily consist of the investment portfolio supporting our Australian domiciled subsidiary. This 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-five percent of the Australian portfolio is rated AAA, by one or more of Moody’s, Standard & Poor’s and Fitch Ratings, and the remaining 15% is rated AA.

The amortized cost and fair values of debt securities at March 31, 2015, 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.

	Amortized Cost		Fair Value
March 31, 2015	(In thousands)

Due in one year or less	$	301,142	$	301,873
Due after one year through five years		1,806,892		1,823,593
Due after five years through ten years		1,127,078		1,133,449
Due after ten years		442,523		451,648

	$	3,677,635	$	3,710,563

Asset-backed securities		253,185		253,919
Residential mortgage-backed securities		315,778		309,031
Commercial mortgage-backed securities		259,934		260,606
Collateralized loan obligations		61,341		60,544

Total at March 31, 2015	$	4,567,873	$	4,594,663

At March 31, 2015 and December 31, 2014, the investment portfolio had gross unrealized losses of $18.7 million and $30.5 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
March 31, 2015	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	$	93,555	$	362	$	26,435	$	1,695	$	119,990	$	2,057
Obligations of U.S. states and political subdivisions		174,785		695		50,757		771		225,542		1,466
Corporate debt securities		621,952		4,169		113,002		1,616		734,954		5,785
Asset-backed securities		34,294		10		11,930		26		46,224		36
Residential mortgage-backed securities		34,574		168		229,563		7,298		264,137		7,466
Commercial mortgage-backed securities		61,443		304		71,895		828		133,338		1,132
Collateralized loan obligations		-		-		60,544		797		60,544		797
Equity securities		68		-		177		5		245		5

Total investment portfolio	$	1,020,671	$	5,708	$	564,303	$	13,036	$	1,584,974	$	18,744

	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
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

The unrealized losses in all categories of our investments at March 31, 2015 and December 31, 2014 were primarily caused by the difference in interest rates at each respective period, compared to interest rates at the time of purchase. There were 278 and 423 securities in an unrealized loss position at March 31, 2015 and December 31, 2014, respectively. During each of the three months ended March 31, 2015 and 2014 there were no other-than-temporary impairments (“OTTI”) recognized.

The net realized investment gains (losses) and OTTI on the investment portfolio are as follows:

	Three Months Ended March 31,
	2015		2014
	(In thousands)

Net realized investment gains (losses) and OTTI on investments:
Fixed maturities	$	26,324	$	(234	)
Equity securities		3		3
	$	26,327	$	(231	)

	Three Months Ended March 31,
	2015			2014
	(In thousands)

Net realized investment gains (losses) and OTTI on investments:
Gains on sales	$	27,206		$	805
Losses on sales		(879	)		(1,036	)
	$	26,327		$	(231	)