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Investments (Tables)

9 Months Ended

Sep. 30, 2024

Schedule of Reconciliation of Cost to Fair Value, Net of Credit Loss Allowance, of Fixed Maturity Securities

The following tables summarize the amortized cost and estimated fair value, net of credit loss allowance, of our fixed maturity securities as of:


	September 30, 2024
(in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value




Available-for-sale securities:
Corporate debt securities (1)	$	643,288	$	11,730	$	6,505	$	648,513
Collateralized debt obligations	110,641		247		616		110,272
Commercial mortgage-backed securities	136,370		3,555		2,570		137,355
Residential mortgage-backed securities	145,864		292		10,981		135,175
Other debt securities	25,542		573		438		25,677

Total available-for-sale securities, net	1,061,705		16,397		21,110		1,056,992

Held-to-maturity securities - states & political subdivisions	4,833		0		0		4,833

Total fixed maturity securities, net	$	1,066,538	$	16,397	$	21,110	$	1,061,825

(1)This includes an estimated fair value of $8.1 million of securities lent under a securities lending agreement.


	December 31, 2023
(in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Available-for-sale securities:




Corporate debt securities	$	600,639	$	4,594	$	16,545	$	588,688
Collateralized debt obligations	114,400		156		2,088		112,468
Commercial mortgage-backed securities	106,019		1,410		4,709		102,720
Residential mortgage-backed securities	153,633		69		13,647		140,055
Other debt securities	17,862		136		688		17,310

Total available-for-sale securities, net	$	992,553	$	6,365	$	37,677	$	961,241

Schedule of Amortized Cost and Estimated Fair Value, Net of Credit Loss Allowance, of Fixed Maturity Securities by Remaining Contractual Term to Maturity

The amortized cost and estimated fair value of available-for-sale and held-to-maturity securities at September 30, 2024 are shown below by remaining contractual term to maturity. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.


	September 30, 2024
	Amortized		Estimated
(in thousands)	cost		fair value
Available-for-sale securities:
Due in one year or less	$	49,077	$	48,447
Due after one year through five years	453,677		456,863
Due after five years through ten years	186,695		188,732
Due after ten years	372,256		362,950
Total available-for-sale securities, net (1) (2)	1,061,705		1,056,992

Held-to-maturity securities - due after ten years	4,833		4,833

Total fixed maturity securities, net	$	1,066,538	$	1,061,825

(1)The contractual maturities of our available-for-sale securities are included in the table. However, given our intent to sell certain impaired securities, these securities are classified as current assets in our Statement of Financial Position at September 30, 2024.

(2)This includes an estimated fair value of $8.1 million of securities lent under a securities lending agreement.

Schedule of Available-For-Sale Securities in a Gross Unrealized Loss Position by Length of Time

The following tables present available-for-sale securities based on length of time in a gross unrealized loss position as of:


	September 30, 2024
	Less than 12 months				12 months or longer				Total
(dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses		No. of holdings





Corporate debt securities	$	56,346	$	377	$	170,974	$	6,128	$	227,320	$	6,505	496
Collateralized debt obligations	39,689		57		19,694		559		59,383		616		102
Commercial mortgage-backed securities	6,367		48		25,992		2,522		32,359		2,570		85
Residential mortgage-backed securities	18,780		82		97,271		10,899		116,051		10,981		152
Other debt securities	1,439		14		5,473		424		6,912		438		29

Total available-for-sale securities	$	122,621	$	578	$	319,404	$	20,532	$	442,025	$	21,110	864
Quality breakdown of available-for-sale securities:
Investment grade	$	100,964	$	248	$	288,847	$	18,369	$	389,811	$	18,617	486
Non-investment grade	21,657		330		30,557		2,163		52,214		2,493		378
Total available-for-sale securities	$	122,621	$	578	$	319,404	$	20,532	$	442,025	$	21,110	864


	December 31, 2023
	Less than 12 months				12 months or longer				Total
(dollars in thousands)	Fair value		Unrealized losses		Fair value		Unrealized losses		Fair value		Unrealized losses		No. of holdings





Corporate debt securities	$	50,853	$	546	$	338,322	$	15,999	$	389,175	$	16,545	590
Collateralized debt obligations	3,911		15		87,005		2,073		90,916		2,088		142
Commercial mortgage-backed securities	9,148		157		30,145		4,552		39,293		4,709		108
Residential mortgage-backed securities	30,271		297		101,761		13,350		132,032		13,647		164
Other debt securities	2,084		62		7,475		626		9,559		688		32

Total available-for-sale securities	$	96,267	$	1,077	$	564,708	$	36,600	$	660,975	$	37,677	1,036
Quality breakdown of available-for-sale securities:
Investment grade	$	87,774	$	807	$	517,090	$	32,511	$	604,864	$	33,318	651
Non-investment grade	8,493		270		47,618		4,089		56,111		4,359		385
Total available-for-sale securities	$	96,267	$	1,077	$	564,708	$	36,600	$	660,975	$	37,677	1,036

Schedule of Allowances for Credit Losses on Fixed Maturity Securities and Financing Receivables

The following tables present a roll-forward of the allowances for credit losses on fixed maturity securities and financing receivables:


	Three months ended September 30, 2024
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	503	$	2,167	$	11,438	$	957
Provision and recoveries	158		0		474		354
Sales/collections and write-offs	(231)		0		0		0
Balance, end of period	$	430	$	2,167	$	11,912	$	1,311


	Nine months ended September 30, 2024
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	597	$	0	$	11,081	$	957
Provision and recoveries	401		2,167		831		354
Sales/collections and write-offs	(568)		0		0		0
Balance, end of period	$	430	$	2,167	$	11,912	$	1,311


	Three months ended September 30, 2023
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	370	$	—	$	3,736	$	957
Provision and recoveries	55		—		2		0
Sales/collections and write-offs	(72)		—		0		0
Balance, end of period	$	353	$	—	$	3,738	$	957


	Nine months ended September 30, 2023
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	249	$	—	$	3,775	$	957
Provision and recoveries	278		—		61		0
Sales/collections and write-offs	(174)		—		(98)		0
Balance, end of period	$	353	$	—	$	3,738	$	957

Schedule of Investment Income (Loss), Net of Expenses

Investment income (loss), net of expenses, was generated from the following portfolios:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Available-for-sale securities	$	12,891	$	11,037	$	36,611	$	31,404
Equity securities	1,119		1,161		3,536		3,260
Limited partnerships (1)	(127)		(13)		134		(10,725)
Cash equivalents and other	4,010		2,687		10,347		6,714
Total investment income	17,893		14,872		50,628		30,653
Less: investment expenses	571		230		1,393		293
Net investment income	$	17,322	$	14,642	$	49,235	$	30,360

(1)Limited partnership (losses) income include both realized gains (losses) and unrealized valuation changes. Our limited partnership investments are included in the line item "Other assets" in the Statements of Financial Position. We have made no new significant limited partnership commitments since 2006, and the balance of limited partnership investments is expected to decline over time as additional distributions are received.

Schedule of Net Realized and Unrealized Investment (Losses) Gains

Realized and unrealized gains (losses) on investments were as follows:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Available-for-sale securities:
Gross realized gains	$	1,457	$	213	$	2,144	$	519
Gross realized losses	(1,315)		(2,693)		(4,639)		(6,714)
Net realized gains (losses) on available-for-sale securities	142		(2,480)		(2,495)		(6,195)
Equity securities	2,782		244		5,477		(3,060)
Miscellaneous	1		9		1		9
Net realized and unrealized investment gains (losses)	$	2,925	$	(2,227)	$	2,983	$	(9,246)

The portion of net unrealized gains (losses) recognized during the reporting period related to equity securities held at the reporting date is calculated as follows:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Equity securities:
Net gains (losses) recognized during the period	$	2,782	$	244	$	5,477	$	(3,060)
Less: net gains (losses) recognized on securities sold	146		91		883		(2,636)
Net unrealized gains (losses) recognized on securities held at reporting date	$	2,636	$	153	$	4,594	$	(424)

Schedule of Impairments on Investments

Impairments on investments were as follows:


	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2024		2023		2024		2023
Available-for-sale securities:
Intent to sell	$	(1)	$	(58)	$	(299)	$	(1,639)
Credit impaired	(158)		(55)		(401)		(278)
Total available-for-sale securities	(159)		(113)		(700)		(1,917)
Expected credit losses:
Held-to-maturity securities	0		—		(2,167)		—
Agent loans	(354)		0		(354)		0
Other loans receivable	(185)		0		(542)		0
Net impairment losses recognized in earnings	$	(698)	$	(113)	$	(3,763)	$	(1,917)