Income Taxes (Tables)

12 Months Ended

Dec. 31, 2016

Schedule of Company's Current and Deferred Federal Tax Expense (Benefit)

Information about the Company’s current and deferred federal tax expense (benefit) follows:



	Years Ended December 31,
	2016			2015			2014
Current expense	$	15,125		$	1,744		$	378
Deferred (benefit) expense	(1,683		)	(342		)	1,474
Total income tax expense	$	13,442		$	1,402		$	1,852

Schedule of Reconciliation of Federal Income Tax Rate to the Company’s Effective Income Tax Rate

A reconciliation of the federal income tax rate to the Company's effective income tax rate follows:



	December 31,
	2016		2015		2014
Federal income tax rate:	35.0	%	35.0	%	35.0	%
Reconciling items:
Tax exempt interest	(0.6	)	(9.4	)	(8.0	)
Dividend received deduction	(0.1	)	(1.7	)	(1.4	)
Goodwill	0.3		—		—
Capital contribution from affiliated entity impacting taxable income	3.7		—		—
Non deductible health insurer fee	0.1		1.0		0.7
Other	0.1		0.2		0.1
Effective income tax rate:	38.5	%	25.1	%	26.4	%

Schedule of Significant Deferred Tax Assets and Deferred Tax Liabilities

The tax effects of temporary differences that result in significant deferred tax assets and liabilities are as follows:



	December 31,
	2016			2015
Deferred tax assets
Deferred gain on disposal of business	$	1,850		$	755
Investments, net	434			1,374
Deferred acquisition costs (1)	1,270			1,143
Other	411			90
Total deferred tax asset	3,965			3,362

Deferred tax liabilities
Policyholder and separate account reserves	—			(1,157		)
Net unrealized appreciation on securities	(1,318		)	(3,200		)
Other	—			(15		)
Total deferred tax liability	(1,318		)	(4,372		)
Net deferred income tax asset (liability)	$	2,647		$	(1,010	)

(1) For life policies, tax law requires that a percentage of premiums related to life insurance contracts be capitalized as tax DAC and amortized over a period of years. Therefore, the tax DAC balance is not immediately affected by the significant decrease in the GAAP DAC balance as of December 31, 2016.