Income Taxes (Tables)

12 Months Ended

Dec. 31, 2018

Significant Components of Deferred Tax Assets and Liabilities

Significant components of the Company's deferred tax assets and liabilities as of December 31 are as follows:

	2018			2017
Deferred tax liabilities:
Unrealized gain on fixed income and equity security investments	$	4,572		$	15,086
Deferred acquisition costs		2,552			1,804
Loss and loss expense reserves		3,583			2,623
Limited partnership investments		–			3,826
Accelerated depreciation		690			492
Other		1,509			1,791
Total deferred tax liabilities		12,906			25,622

Deferred tax assets:
Loss and loss expense reserves		9,999			6,761
Limited partnership investments		3,498			–
Unearned premiums discount		2,321			1,837
Other-than-temporary investment declines		625			815
Deferred compensation		580			885
Deferred ceding commission		1,173			627
Other		972			339
Total deferred tax assets		19,168			11,264

Net deferred tax (assets) liabilities	$	(6,262	)	$	14,358

Summary of Difference between Federal Income Taxes Expense Computed at Statutory Rate

A summary of the difference between federal income tax expense computed at the statutory rate and that reported in the consolidated financial statements as of December 31 is as follows:

	2018			2017			2016

Statutory federal income rate applied to pre-tax income (loss)	$	(9,213	)	$	3,543		$	15,069
Tax effect of (deduction):
Tax-exempt investment income		(253	)		(968	)		(938	)
Change in enacted tax rates		–			(9,572	)		–
Other		(331	)		(1,204	)		(22	)
Federal income tax expense (benefit)	$	(9,797	)	$	(8,201	)	$	14,109

Federal Income Tax Expense (Benefit)

Federal income tax expense (benefit) as of December 31 consists of the following:

	2018			2017			2016
Tax expense (benefit) on pre-tax income (loss):
Current	$	8,997		$	(4,335	)	$	11,271
Deferred		(18,794	)		(3,866	)		2,838
	$	(9,797	)	$	(8,201	)	$	14,109

Provision for Deferred Federal Income Tax

The provision for deferred federal income taxes as of December 31 consists of the following:

	2018			2017			2016
Limited partnerships	$	(2,383	)	$	4,099		$	503
Discounts of loss and loss expense reserves		(2,704	)		1,315			(114	)
Reserves - salvage and subrogation and other		427			56			(1,110	)
Unearned premium discount		(484	)		(1,767	)		298
Deferred compensation		305			(168	)		595
Other-than-temporary investment declines		695			(127	)		2,320
Deferred acquisitions costs and ceding commission		201			1,553			(95	)
Change in enacted tax rates		–			(9,572	)		–
Unrealized gains / losses		(13,876	)		–			–
Other		(975	)		745			441
Provision for deferred federal income taxes	$	(18,794	)	$	(3,866	)	$	2,838