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Investments | 3 Months Ended
--- | ---
Dec. 31, 2011
Investments, Debt and Equity Securities [Abstract] |
3. Investments | 3. Investments Expected maturities may differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. The Company deposits bonds with insurance regulatory authorities to meet statutory requirements. The adjusted cost of bonds on deposit with insurance regulatory authorities was $14.4 million at December 31, 2011. Available-for-Sale Investments Available-for-sale investments at December 31, 2011 were as follows:
|  | Amortized Cost |  |  | Gross Unrealized Gains |  |  | Gross Unrealized Losses More than 12 Months |  |  | Gross Unrealized Losses Less than 12 Months |  |  | Estimated Market Value |
|  | (Unaudited) |
|  | (In thousands) |
U.S. treasury securities and government obligations |  | $ | 27,128 |  |  | $ | 2,990 |  |  | $ | (18 | ) |  | $ | - |  |  | $ | 30,100 |
U.S. government agency mortgage-backed securities |  |  | 51,155 |  |  |  | 5,151 |  |  |  | (1 | ) |  |  | (30 | ) |  |  | 56,275 |
Obligations of states and political subdivisions |  |  | 129,145 |  |  |  | 8,703 |  |  |  | - |  |  |  | (15 | ) |  |  | 137,833 |
Corporate securities |  |  | 422,704 |  |  |  | 32,884 |  |  |  | (776 | ) |  |  | (1,645 | ) |  |  | 453,167 |
Mortgage-backed securities |  |  | 12,708 |  |  |  | 235 |  |  |  | (62 | ) |  |  | (62 | ) |  |  | 12,819 |
Redeemable preferred stocks |  |  | 24,370 |  |  |  | 903 |  |  |  | (1,724 | ) |  |  | (144 | ) |  |  | 23,405 |
Common stocks |  |  | 27,736 |  |  |  | 11 |  |  |  | (16,304 | ) |  |  | (586 | ) |  |  | 10,857 |
|  | $ | 694,946 |  |  | $ | 50,877 |  |  | $ | (18,885 | ) |  | $ | (2,482 | ) |  | $ | 724,456 |
The table above includes gross unrealized losses that are not deemed to be other-than-temporarily impaired, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position. The Company sold available-for-sale securities with a fair value of $132.6 million during the first nine months of fiscal 2012. The gross realized gains on these sales totaled $5.8 million. The gross realized losses on these sales totaled $0.1 million. The unrealized losses of more than twelve months in the available-for-sale table are considered temporary declines. The Company tracks each investment with an unrealized loss and evaluates them on an individual basis for other-than-temporary impairments including obtaining corroborating opinions from third party sources, performing trend analysis and reviewing management's future plans. Certain of these investments may have declines determined by management to be other-than-temporary and the Company recognizes these write-downs through earnings. The Company's insurance subsidiaries recognized $0.1 million in other-than-temporary impairments for the first nine months of fiscal 2012. There were no write downs in the third quarter of fiscal 2012 and 2011 or for the first nine months of fiscal 2011. The investment portfolio primarily consists of corporate securities and U.S. government securities. The Company believes it monitors its investments as appropriate. The Company's methodology of assessing other-than-temporary impairments is based on security-specific analysis as of the balance sheet date and considers various factors including the length of time to maturity, the extent to which the fair value has been less than the cost, the financial condition and the near-term prospects of the issuer, and whether the debtor is current on its contractually obligated interest and principal payments. Nothing has come to management's attention that would lead to the belief that each issuer would not have the ability to meet the remaining contractual obligations of the security, including payment at maturity. The Company has the ability and intent not to sell its fixed maturity and common stock investments for a period of time sufficient to allow the Company to recover its costs. The portion of other-than-temporary impairment related to a credit loss is recognized in earnings. The significant inputs utilized in the evaluation of mortgage backed securities credit losses include ratings, delinquency rates, and prepayment activity. The significant inputs utilized in the evaluation of asset backed securities credit losses include the time frame for principal recovery and the subordination and value of the underlying collateral. Credit losses recognized in earnings for which a portion of an other-than-temporary impairment was recognized in other comprehensive income were as follows:
|  | Credit Loss |
|  | (Unaudited) |
|  | (In thousands) |
Balance at March 31, 2011 |  | $ | 552 |
Additions: |  |  |  |
Other-than-temporary impairment not previously recognized |  |  | - |
Balance at December 31, 2011 |  | $ | 552 |
The adjusted cost and estimated market value of available-for-sale investments at December 31, 2011, by contractual maturity, were as follows:
|  | Amortized Cost |  |  | Estimated Market Value |
|  | (Unaudited) |
|  | (In thousands) |
Due in one year or less |  | $ | 41,597 |  |  | $ | 42,051 |
Due after one year through five years |  |  | 153,462 |  |  |  | 161,091 |
Due after five years through ten years |  |  | 171,083 |  |  |  | 183,771 |
Due after ten years |  |  | 263,990 |  |  |  | 290,462 |
|  |  | 630,132 |  |  |  | 677,375 |
Mortgage backed securities |  |  | 12,708 |  |  |  | 12,819 |
Redeemable preferred stocks |  |  | 24,370 |  |  |  | 23,405 |
Equity securities |  |  | 27,736 |  |  |  | 10,857 |
|  | $ | 694,946 |  |  | $ | 724,456 |

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- Definition Tabular disclosure of investments in certain debt and equity securities (and certain other trading assets) which include all debt and equity securities (other than those equity securities accounted for under the equity or cost methods of accounting) with readily determinable fair values. Other trading assets include assets that are carried on the balance sheet at fair value and held for trading purposes. A debt security represents a creditor relationship with an enterprise that is in the form of a security. Debt securities include, among other items, US Treasury securities, US government securities, municipal securities, corporate bonds, convertible debt, commercial paper, and all securitized debt instruments. An equity security represents an ownership interest in an enterprise or the right to acquire or dispose of an ownership interest in an enterprise at fixed or determinable prices. Equity securities include, among other things, common stock, certain preferred stock, warrant rights, call options, and put options, but do not include convertible debt. An entity may opt to provide the reader with additional narrative text to better understand the nature of investments in debt and equity securities (and other trading assets). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 10 -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27405-111563 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6379141&loc=d3e15032-111544 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Equity Security -URI http://asc.fasb.org/extlink&oid=6511694 -Topic 320 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27161-111563 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Glossary Debt Security -URI http://asc.fasb.org/extlink&oid=6509901 -Topic 320 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 115 -Paragraph 3, 19, 20, 21, 22, 137 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27232-111563 Reference 8: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27357-111563 Reference 9: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 942 -SubTopic 320 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6957658&loc=d3e62557-112803 Reference 10: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 320 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6872113&loc=d3e27290-111563 + Details
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