Investments

9 Months Ended

Sep. 30, 2025

Investments [Abstract]

Investments

Investments

Fixed maturity securities

See Note 6, "Fair Value" for additional fair value disclosures. 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, 2025
(in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Available-for-sale securities:
Corporate debt securities	$	663,602	$	12,714	$	3,230	$	673,086
Collateralized debt obligations	90,481		238		168		90,551
Commercial mortgage-backed securities	121,053		2,868		1,710		122,211
Residential mortgage-backed securities	151,730		736		11,300		141,166
Other debt securities	31,091		622		264		31,449
U.S. Treasury	7,259		120		9		7,370
Total available-for-sale securities, net (1)	1,065,216		17,298		16,681		1,065,833
Held-to-maturity securities - states & political subdivisions	4,833		43		0		4,876
Total fixed maturity securities, net	$	1,070,049	$	17,341	$	16,681	$	1,070,709

(1)This includes an estimated fair value of $35.9 million of securities lent under a securities lending agreement.

	December 31, 2024
(in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Estimated fair value
Available-for-sale securities:
Corporate debt securities	$	647,861	$	4,767	$	8,685	$	643,943
Collateralized debt obligations	114,142		372		387		114,127
Commercial mortgage-backed securities	126,509		1,458		2,985		124,982
Residential mortgage-backed securities	150,212		62		16,462		133,812
Other debt securities	27,232		147		628		26,751
Total available-for-sale securities, net (1)	1,065,956		6,806		29,147		1,043,615
Held-to-maturity securities - states & political subdivisions	4,833		101		0		4,934
Total fixed maturity securities, net	$	1,070,789	$	6,907	$	29,147	$	1,048,549

(1)This includes an estimated fair value of $7.3 million of securities lent under a securities lending agreement.

The amortized cost and estimated fair value of available-for-sale and held-to-maturity securities at September 30, 2025 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, 2025
	Amortized		Estimated
(in thousands)	cost		fair value
Available-for-sale securities:
Due in one year or less	$	63,952	$	63,710
Due after one year through five years	460,087		465,927
Due after five years through ten years	136,215		138,111
Due after ten years	404,962		398,085
Total available-for-sale securities, net (1) (2)	1,065,216		1,065,833
Held-to-maturity securities - due after ten years	4,833		4,876
Total fixed maturity securities, net	$	1,070,049	$	1,070,709

(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 Consolidated Statement of Financial Position at September 30, 2025.

(2)This includes an estimated fair value of $35.9 million of securities lent under a securities lending agreement.

The below securities have been evaluated for credit impairment using criteria described within Note 2, "Significant Accounting Policies, of Notes to Consolidated Financial Statements" included in our Annual Report on Form 10-K for the year ended December 31, 2024 as filed with the SEC on February 27, 2025. The gross unrealized losses are primarily attributable to changes in interest rates and are not deemed to be credit-related. We do not have the intent to sell these securities and it is more likely than not that we would not be required to sell these securities before the anticipated recovery of the amortized cost basis.

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

	September 30, 2025
	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	$	23,443	$	817	$	107,364	$	2,413	$	130,807	$	3,230	358
Collateralized debt obligations	25,562		69		5,396		99		30,958		168		54
Commercial mortgage-backed securities	4,833		55		19,434		1,655		24,267		1,710		66
Residential mortgage-backed securities	17,132		248		88,556		11,052		105,688		11,300		144
Other debt securities	1,681		25		3,770		239		5,451		264		24
U.S. Treasury	1,469		9		0		0		1,469		9		1
Total available-for-sale securities	$	74,120	$	1,223	$	224,520	$	15,458	$	298,640	$	16,681	647
Quality breakdown of available-for-sale securities:
Investment grade	$	53,947	$	408	$	204,399	$	14,379	$	258,346	$	14,787	344
Non-investment grade	20,173		815		20,121		1,079		40,294		1,894		303
Total available-for-sale securities	$	74,120	$	1,223	$	224,520	$	15,458	$	298,640	$	16,681	647

	December 31, 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	$	197,619	$	2,486	$	156,059	$	6,199	$	353,678	$	8,685	567
Collateralized debt obligations	33,686		71		11,762		316		45,448		387		77
Commercial mortgage-backed securities	28,333		407		24,966		2,578		53,299		2,985		131
Residential mortgage-backed securities	38,003		1,289		90,209		15,173		128,212		16,462		169
Other debt securities	11,663		150		5,045		478		16,708		628		42
Total available-for-sale securities	$	309,304	$	4,403	$	288,041	$	24,744	$	597,345	$	29,147	986
Quality breakdown of available-for-sale securities:
Investment grade	$	280,332	$	3,701	$	260,480	$	22,664	$	540,812	$	26,365	616
Non-investment grade	28,972		702		27,561		2,080		56,533		2,782		370
Total available-for-sale securities	$	309,304	$	4,403	$	288,041	$	24,744	$	597,345	$	29,147	986

Credit loss allowances

The following tables present a roll-forward of the allowances for credit losses on investments:

	Three months ended September 30, 2025
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	881	$	2,167	$	13,038	$	1,476
Provision and recoveries	417		0		218		111
Sales/collections and write-offs	(64)		0		(25)		0
Balance, end of period	$	1,234	$	2,167	$	13,231	$	1,587

	Nine months ended September 30, 2025
(in thousands)	Available-for-sale securities		Held-to-maturity securities		Other loans receivable		Agent loans
Balance, beginning of period	$	513	$	2,167	$	12,198	$	1,312
Provision and recoveries	1,086		0		1,058		275
Sales/collections and write-offs	(365)		0		(25)		0
Balance, end of period	$	1,234	$	2,167	$	13,231	$	1,587

	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

Net investment income

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

	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2025		2024		2025		2024
Available-for-sale securities	$	14,068	$	12,891	$	41,881	$	36,611
Equity securities	1,220		1,119		3,533		3,536
Limited partnerships (1)	114		(127)		1,269		134
Agent loans (2)	1,633		1,070		4,634		2,891
Cash equivalents and other (2)	4,606		2,940		11,502		7,456
Total investment income	21,641		17,893		62,819		50,628
Less: investment expenses	608		571		1,808		1,393
Net investment income	$	21,033	$	17,322	$	61,011	$	49,235

(1)Limited partnership income (losses) include both realized gains (losses) and unrealized valuation changes. Our limited partnership investments are included in the line item "Other assets, net" in the Consolidated 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.

(2)2024 amounts have been reclassified to conform to the current period presentation.

Net realized and unrealized investment gains

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

	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2025		2024		2025		2024
Available-for-sale securities:
Gross realized gains	$	908	$	1,457	$	1,588	$	2,144
Gross realized losses	(337)		(1,315)		(1,710)		(4,639)
Net realized gains (losses) on available-for-sale securities	571		142		(122)		(2,495)
Equity securities	760		2,782		2,429		5,477
Miscellaneous	0		1		5		1
Net realized and unrealized investment gains	$	1,331	$	2,925	$	2,312	$	2,983

The portion of net unrealized gains 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)	2025		2024		2025		2024
Equity securities:
Net gains recognized during the period	$	760	$	2,782	$	2,429	$	5,477
Less: net gains recognized on securities sold	66		146		340		883
Net unrealized gains recognized on securities held at reporting date	$	694	$	2,636	$	2,089	$	4,594

Net impairment losses recognized in earnings

Impairments on investments were as follows:

	Three months ended September 30,				Nine months ended September 30,
(in thousands)	2025		2024		2025		2024
Available-for-sale securities:
Intent to sell	$	(78)	$	(1)	$	(495)	$	(299)
Credit impaired	(417)		(158)		(1,086)		(401)
Total available-for-sale securities	(495)		(159)		(1,581)		(700)
Expected credit losses:
Held-to-maturity securities	0		0		0		(2,167)
Agent loans	(111)		(354)		(275)		(354)
Other loans receivable	(204)		(185)		(777)		(542)
Net impairment losses recognized in earnings	$	(810)	$	(698)	$	(2,633)	$	(3,763)

Securities lending transactions

As of September 30, 2025, the estimated fair value of loaned securities was $56.2 million, comprised of $35.9 million and $20.3 million of available-for-sale and equity securities, respectively. The related cash collateral received was $54.3 million, which was reinvested in cash equivalents and is included with "Cash and cash equivalents" in our Consolidated Statement of Financial Position. We also received $3.6 million of non-cash collateral that we are not permitted to sell or repledge, and there are no securities lending transactions that extend beyond one year from the reporting date.

If we have to return cash collateral on short notice, we may have difficulty selling investments in a timely manner, be forced to sell them for less than we otherwise would have been able to realize, or both. In addition, in the event of such forced sale, for securities in an unrealized loss position, realized losses would be incurred on securities sold and impairments would be incurred, if there is a need to sell securities prior to recovery, which may negatively impact our financial condition.