Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2014

Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]

Schedule of The Carrying Amounts and Estimated Fair Values of Financial Instruments



	September 30, 2014			December 31, 2013
($ in thousands)	Carrying Amount		Fair Value	Carrying Amount	Fair Value
Financial Assets
Fixed income securities:
HTM	$	336,082	354,190	392,879	416,981
AFS	3,967,638		3,967,638	3,715,536	3,715,536
Equity securities, AFS	211,266		211,266	192,771	192,771
Short-term investments	181,593		181,593	174,251	174,251
Financial Liabilities
Notes payable:
2.90% borrowings from FHLBI	13,000		13,085	13,000	13,319
1.25% borrowings from FHLBI	45,000		45,220	45,000	45,259
7.25% Senior Notes	49,896		56,970	49,916	50,887
6.70% Senior Notes	99,398		110,310	99,498	98,247
5.875% Senior Notes	185,000		179,598	185,000	146,298
Total notes payable	$	392,294	405,183	392,414	354,010

Schedule of Quantitative Disclosures of Our Financial Assets That Were Measured At Fair Value



September 30, 2014			Fair Value Measurements Using
($ in thousands)	Assets Measured at Fair Value at 9/30/2014		Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1)¹	Significant Other Observable Inputs (Level 2)¹	Significant Unobservable Inputs (Level 3)
Description
Measured on a recurring basis:
AFS:
U.S. government and government agencies	$	151,689	51,467	100,222	—
Foreign government	27,867		—	27,867	—
Obligations of states and political subdivisions	1,229,234		—	1,229,234	—
Corporate securities	1,763,230		—	1,763,230	—
ABS	146,966		—	146,966	—
CMBS	165,518		—	165,518	—
RMBS	483,134		—	483,134	—
Total AFS fixed income securities	3,967,638		51,467	3,916,171	—
Equity securities	211,266		208,366	—	2,900
Total AFS Securities	4,178,904		259,833	3,916,171	2,900
Short-term investments	181,593		181,593	—	—
Total assets measured at fair value	$	4,360,497	441,426	3,916,171	2,900


¹	There were no transfers of securities between Level 1 and Level 2.



December 31, 2013			Fair Value Measurements Using
($ in thousands)	Assets Measured at Fair Value at 12/31/13		Quoted Prices in Active Markets for Identical Assets/Liabilities (Level 1)¹	Significant Other Observable Inputs (Level 2)¹	Significant Unobservable Inputs (Level 3)
Description
Measured on a recurring basis:
AFS:
U.S. government and government agencies	$	173,375	52,153	121,222	—
Foreign government	30,615		—	30,615	—
Obligations of states and political subdivisions	951,624		—	951,624	—
Corporate securities	1,734,883		—	1,734,883	—
ABS	140,896		—	140,896	—
CMBS	171,284		—	171,284	—
RMBS	512,859		—	512,859	—
Total AFS fixed income securities	3,715,536		52,153	3,663,383	—
Equity securities	192,771		189,871	—	2,900
Total AFS Securities	3,908,307		242,024	3,663,383	2,900
Short-term investments	174,251		174,251	—	—
Total assets measured at fair value	$	4,082,558	416,275	3,663,383	2,900


¹	There were no transfers of securities between Level 1 and Level 2.

Schedule of Summary of the Changes in Fair Value of Securities measured Using Level 3 Inputs



December 31, 2013
($ in thousands)	Government			Corporate			ABS			CMBS			Equity			Receivable for Proceeds Related to Sale of Selective HR Solutions ("Selective HR")			Total
Fair value, December 31, 2012	$	19,789		2,946			6,068			7,162			3,607			2,705			42,277
Total net (losses) gains for the period included in:
OCI¹	(537		)	(7		)	(74		)	772			3,935			—			4,089
Net income^2,3	(76		)	—			—			361			—			(1,480		)	(1,195		)
Purchases	—			—			—			—			—			—			—
Sales	—			—			—			—			—			—			—
Issuances	—			—			—			—			—			—			—
Settlements	(1,847		)	(168		)	—			(2,420		)	—			(225		)	(4,660		)
Transfers into Level 3	—			—			—			—			—			—			—
Transfers out of Level 3	(17,329		)	(2,771		)	(5,994		)	(5,875		)	(4,642		)	(1,000		)	(37,611		)
Fair value, December 31, 2013	$	—		$	—		$	—		$	—		$	2,900		$	—		$	2,900

¹Amounts are reported in “Unrealized holding (losses) gains arising during period” on the Consolidated Statements of Comprehensive Income in our 2013 Annual Report.

²Amounts are reported in “Net realized gains” for realized gains and losses and “Net investment income earned” for amortization of securities on the Consolidated Statements of Income in our 2013 Annual Report.

³For the receivable related to the sale of Selective HR, amounts in "Loss on disposal of discontinued operations, net of tax" relate to an impairment charge and amounts in "Other income" relate to interest accretion on the Consolidated Statements of Income in our 2013 Annual Report.

Schedule of Quantitative Information of Our Financial Assets and Liabilities That Were Disclosed at Fair Value



September 30, 2014			Fair Value Measurements Using
($ in thousands)	Assets/ Liabilities Disclosed at Fair Value at 9/30/2014		Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Financial Assets
HTM:
Foreign government	$	5,407	—	5,407	—
Obligations of states and political subdivisions	317,609		—	317,609	—
Corporate securities	22,726		—	22,726	—
ABS	3,124		—	3,124	—
CMBS	5,324		—	5,324	—
Total HTM fixed income securities	$	354,190	—	354,190	—
Financial Liabilities
Notes payable:
2.90% borrowings from FHLBI	$	13,085	—	13,085	—
1.25% borrowings from FHLBI	45,220		—	45,220	—
7.25% Senior Notes	56,970		—	56,970	—
6.70% Senior Notes	110,310		—	110,310	—
5.875% Senior Notes	179,598		179,598	—	—
Total notes payable	$	405,183	179,598	225,585	—



December 31, 2013			Fair Value Measurements Using
($ in thousands)	Assets/ Liabilities Disclosed at Fair Value at 12/31/2013		Quoted Prices in Active Markets for Identical Assets/ Liabilities (Level 1)	Significant Other Observable Inputs (Level 2)	Significant Unobservable Inputs (Level 3)
Financial Assets
HTM:
Foreign government	$	5,591	—	5,591	—
Obligations of states and political subdivisions	369,756		—	369,756	—
Corporate securities	30,274		—	30,274	—
ABS	3,415		—	3,415	—
CMBS	7,945		—	7,945	—
Total HTM fixed income securities	$	416,981	—	416,981	—
Financial Liabilities
Notes payable:
2.90% borrowings from FHLBI	$	13,319	—	13,319	—
1.25% borrowings from FHLBI	45,259		—	45,259	—
7.25% Senior Notes	50,887		—	50,887	—
6.70% Senior Notes	98,247		—	98,247	—
5.875% Senior Notes	146,298		146,298	—	—
Total notes payable	$	354,010	146,298	207,712	—

- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities.

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