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Investments | 12 Months Ended
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Dec. 31, 2011
Investments [Abstract] |
Investments | 2. Investments The Company applies the fair value option to all fixed maturity and equity securities and short-term investments at the time an eligible item is first recognized. Gains and losses due to changes in fair value for items measured at fair value pursuant to application of the fair value option are included in net realized investment gains in the Company's consolidated statements of operations, while interest and dividend income on investment holdings are recognized on an accrual basis on each measurement date and are included in net investment income in the Company's consolidated statements of operations. The following table presents gains and losses due to changes in fair value of investments that are measured at fair value pursuant to application of the fair value option:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (Amounts in thousands) |
Fixed maturity securities |  | $ | 62,149 |  |  | $ | 967 |  |  | $ | 261,866 |
Equity securities |  |  | (30,879 | ) |  |  | 45,659 |  |  |  | 133,580 |
Short-term investments |  |  | 19 |  |  |  | (46 | ) |  |  | 36 |
Total |  | $ | 31,289 |  |  | $ | 46,580 |  |  | $ | 395,482 |
A summary of net realized investment gains is as follows:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (Amounts in thousands) |
Net realized gains from investments and other liabilities: |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturities |  | $ | 54,112 |  |  | $ | 5,909 |  |  | $ | 255,195 |
Equity securities |  |  | (4,854 | ) |  |  | 46,547 |  |  |  | 83,452 |
Short-term investments |  |  | 139 |  |  |  | 18 |  |  |  | 76 |
Option and short sale transactions |  |  | 9,000 |  |  |  | 4,615 |  |  |  | 7,721 |
Total |  | $ | 58,397 |  |  | $ | 57,089 |  |  | $ | 346,444 |
Net realized gains from investments included gains of $49.4 million, $52.5 million and $338.7 million related to trading securities which were still held at December 31, 2011, 2010, and 2009, respectively. Gross gains and losses realized on the sales of investments, excluding option and short sale transactions, are shown below:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (Amounts in thousands) |
|  | Gross Realized Gains |  |  | Gross Realized Losses |  |  | Net |  |  | Gross Realized Gains |  |  | Gross Realized Losses |  |  | Net |  |  | Gross Realized Gains |  |  | Gross Realized Losses |  |  | Net |
Fixed maturities |  | $ | 2,675 |  |  | $ | (10,712 | ) |  | $ | (8,037 | ) |  | $ | 8,754 |  |  | $ | (3,812 | ) |  | $ | 4,942 |  |  | $ | 1,918 |  |  | $ | (8,589 | ) |  | $ | (6,671 | )
Equity securities |  |  | 41,872 |  |  |  | (15,847 | ) |  |  | 26,025 |  |  |  | 16,793 |  |  |  | (15,905 | ) |  |  | 888 |  |  |  | 20,558 |  |  |  | (70,686 | ) |  |  | (50,128 | )
Short-term investments |  |  | 120 |  |  |  | 0 |  |  |  | 120 |  |  |  | 64 |  |  |  | 0 |  |  |  | 64 |  |  |  | 356 |  |  |  | (3,902 | ) |  |  | (3,546 | )
Contractual Maturity At December 31, 2011, fixed maturity holdings rated below investment grade and non-rated comprised 3.7% of total investments at fair value. Additionally, the Company owns securities that are credit enhanced by financial guarantors that are subject to uncertainty related to market perception of the guarantors' ability to perform. Determining the estimated fair value of municipal bonds could become more difficult should markets for these securities become illiquid. The estimated fair values at December 31, 2011 by contractual maturity are shown below. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
|  | Estimated Fair Value |
|  | (Amounts in thousands) |
Fixed maturities: |  |  |  |
Due in one year or less |  | $ | 30,756 |
Due after one year through five years |  |  | 370,609 |
Due after five years through ten years |  |  | 556,519 |
Due after ten years |  |  | 1,450,334 |
Mortgage-backed securities |  |  | 37,371 |
Total |  | $ | 2,445,589 |
Investment Income A summary of net investment income is shown in the following table:
|  | Year Ended December 31, |
|  | 2011 |  |  | 2010 |  |  | 2009 |
|  | (Amounts in thousands) |
Fixed maturities |  | $ | 130,895 |  |  | $ | 136,345 |  |  | $ | 137,607 |
Equity securities |  |  | 10,869 |  |  |  | 8,435 |  |  |  | 8,558 |
Short-term investments |  |  | 1,747 |  |  |  | 1,413 |  |  |  | 1,082 |
Total investment income |  | $ | 143,511 |  |  | $ | 146,193 |  |  | $ | 147,247 |
Less: Investment expense |  |  | 2,564 |  |  |  | 2,379 |  |  |  | 2,298 |
Net investment income |  | $ | 140,947 |  |  | $ | 143,814 |  |  | $ | 144,949 |

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- Definition The entire disclosure for investments, including all tables. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Article 12 + Details
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