Investments (Tables)

6 Months Ended

Jun. 30, 2015

Summary of Amortized Cost, Gross Unrealized Gains and Losses, and Estimated Fair Value of Available-for-Sale Securities

At June 30, 2015 and December 31, 2014, the cost or amortized cost, gross unrealized gains and losses, and estimated fair value of the Company’s available-for-sale securities by security type were as follows:


	Cost or Amortized Cost		Gross Unrealized Gain		Gross Unrealized Loss			Estimated Fair Value
*As of June 30, 2015*
Fixed-maturity securities
U.S. Treasury and U.S. government agencies	$	10,918	$	18	$	(9	)	$	10,927
Corporate bonds		43,118		94		(807	)		42,405
Asset-backed securities		4,162		4		(3	)		4,163
Mortgage-backed securities		14,528		5		(95	)		14,438
State, municipalities, and political subdivisions		82,489		705		(657	)		82,537
Redeemable preferred stock		10,283		221		(37	)		10,467
Other		497		1		—			498

Total		165,995		1,048		(1,608	)		165,435
Equity securities		59,557		2,327		(1,553	)		60,331

Total available-for-sale securities	$	225,552	$	3,375	$	(3,161	)	$	225,766

*As of December 31, 2014*
Fixed-maturity securities
U.S. Treasury and U.S. government agencies	$	2,881	$	5	$	(8	)	$	2,878
Corporate bonds		23,645		57		(430	)		23,272
Asset-backed securities		697		—		—			697
Mortgage-backed securities		3,004		8		(3	)		3,009
State, municipalities, and political subdivisions		56,336		1,205		(38	)		57,503
Redeemable preferred stock		9,433		178		(54	)		9,557
Other		167		1		—			168

Total		96,163		1,454		(533	)		97,084
Equity securities		45,387		1,694		(1,531	)		45,550

Total available-for-sale securities	$	141,550	$	3,148	$	(2,064	)	$	142,634

Scheduled Contractual Maturities of Fixed-Maturity Securities

The scheduled contractual maturities of fixed-maturity securities as of June 30, 2015 and December 31, 2014 are as follows:


	Amortized Cost		Estimated Fair Value
*As of June 30, 2015*
Available-for-sale
Due in one year or less	$	687	$	690
Due after one year through five years		49,439		49,605
Due after five years through ten years		80,498		79,836
Due after ten years		20,843		20,866
Mortgage-backed securities		14,528		14,438

	$	165,995	$	165,435


	Amortized Cost		Estimated Fair Value
*As of December 31, 2014*
Available-for-sale
Due in one year or less	$	715	$	721
Due after one year through five years		25,973		26,093
Due after five years through ten years		56,448		56,847
Due after ten years		10,023		10,414
Mortgage-backed securities		3,004		3,009

	$	96,163	$	97,084

Summary of Proceeds Received and Gross Realized Gains and Losses from Sales of Available for Sale Securities

Proceeds received, and the gross realized gains and losses from sales of available-for-sale securities, for the three and six months ended June 30, 2015 and 2014 were as follows:


	Proceeds		Gross Realized Gains		Gross Realized Losses
Three months ended June 30, 2015
Fixed-maturity securities	$	1,051	$	1	$	(24	)

Equity securities	$	3,239	$	121	$	(172	)

Three months ended June 30, 2014
Fixed-maturity securities	$	18,271	$	799	$	—

Equity securities	$	3,166	$	433	$	(65	)

Six months ended June 30, 2015
Fixed-maturity securities	$	3,285	$	59	$	(30	)

Equity securities	$	7,994	$	329	$	(625	)

Six months ended June 30, 2014
Fixed-maturity securities	$	19,962	$	864	$	(9	)

Equity securities	$	5,930	$	508	$	(192	)

Summary of Securities with Gross Unrealized Loss Positions Aggregated by Investment Category

Securities with gross unrealized loss positions at June 30, 2015 and December 31, 2014, aggregated by investment category and length of time the individual securities have been in a continuous loss position, are as follows:


	Less Than Twelve Months					Twelve Months or Greater					Total
	Gross Unrealized Loss			Estimated Fair Value		Gross Unrealized Loss			Estimated Fair Value		Gross Unrealized Loss			Estimated Fair Value
As of June 30, 2015
Fixed-maturity securities
U.S. Treasury and U.S. government agencies	$	(9	)	$	3,224	$	—		$	—	$	(9	)	$	3,224
Corporate bonds		(789	)		33,325		(18	)		982		(807	)		34,307
Asset-backed securities		(3	)		1,234		—			—		(3	)		1,234
Mortgage-backed securities		(95	)		10,365		—			—		(95	)		10,365
State, municipalities, and political subdivisions		(609	)		40,529		(48	)		594		(657	)		41,123
Redeemable preferred stock		(37	)		2,981		—			—		(37	)		2,981

Total fixed-maturity securities		(1,542	)		91,658		(66	)		1,576		(1,608	)		93,234
Equity securities		(1,527	)		24,714		(26	)		834		(1,553	)		25,548

Total available-for-sale securities	$	(3,069	)	$	116,372	$	(92	)	$	2,410	$	(3,161	)	$	118,782

At June 30, 2015, there were 222 securities in an unrealized loss position. Of these securities, seven securities had been in an unrealized loss position for 12 months or greater.


	Less Than Twelve Months					Twelve Months or Greater					Total
	Gross Unrealized Loss			Estimated Fair Value		Gross Unrealized Loss			Estimated Fair Value		Gross Unrealized Loss			Estimated Fair Value
As of December 31, 2014
Fixed-maturity securities
U.S. Treasury and U.S. government agencies	$	(8	)	$	2,485	$	—		$	—	$	(8	)	$	2,485
Corporate bonds		(428	)		12,720		(2	)		998		(430	)		13,718
Asset-backed securities		—			209		—			—		—			209
Mortgage-backed securities		(3	)		1,018		—			—		(3	)		1,018
State, municipalities, and political subdivisions		(19	)		3,144		(19	)		202		(38	)		3,346
Redeemable preferred stock		(54	)		2,586		—			—		(54	)		2,586

Total fixed-maturity securities		(512	)		22,162		(21	)		1,200		(533	)		23,362
Equity securities		(1,449	)		18,848		(82	)		4,619		(1,531	)		23,467

Total available-for-sale securities	$	(1,961	)	$	41,010	$	(103	)	$	5,819	$	(2,064	)	$	46,829

Schedule of Company's Investments in Limited Partnerships

The following table provides information related to the Company’s investments in limited partnerships.


	June 30, 2015						December 31, 2014
	Carrying Value		Unfunded Balance		(%)(a)		Carrying Value		Unfunded Balance		(%)(a)
Investment Strategy
Primarily in senior secured loans and, to a limited extent, in other debt and equity securities of private U.S. lower-middle-market companies. (b)(c)(e)	$	4,895	$	7,549		16.50	$	2,550	$	9,860		16.50
Value creation through active distressed debt investing primarily in bank loans, public and private corporate bonds, asset-backed securities, and equity securities received in connection with debt restructuring. (b)(d)(e)		3,194		4,682		0.65		—		—		—
Maximum long-term capital appreciation through long and short positions in equity and/or debt securities of publicly traded U.S. and non-U.S. issuers, derivative instruments and certain other financial instruments. (f)		14,627		—		66.78		—		—		—
High returns and long-term capital appreciation through investments in the power, utility and energy industries, and in the infrastructure sector. (b)(g)(h)		—		10,000		—		—		—		—

Total	$	22,716	$	22,231			$	2,550	$	9,860

(a)	Represents the Company’s percentage investment in the fund at the balance sheet date.

(b)	Except under certain circumstances, withdrawals from the funds or any assignments are not permitted. Distributions will be received when underlying investments of the funds are liquidated.

(c)	Expected to have a 10-year term and the capital commitment is expected to expire on September 3, 2019.

(d)	Expected to have a three-year term from the end of the capital commitment period, which is March 31, 2018.

(e)	At the fund manager’s discretion, the term of the fund may be extended for up to two additional one-year periods.

(f)	Withdrawal is permitted upon at least 45 days’ written notice to the general partner, provided that the Company has been a limited partner for at least 12 months.

(g)	Expected to have a 10-year term and the capital commitment is expected to expire on June 30, 2020.

(h)	With the consent of a super majority, the term of the fund may be extended for up to three additional one-year periods.

Summary of Unaudited Financial Information and Unaudited Financial Position

The joint venture partners received no distributions during 2015. The following tables provide summarized unaudited financial results for the three months and six months ended June 30, 2015 and the unaudited financial positions of the joint venture at June 30, 2015 and December 31, 2014:


	Three Months Ended June 30, 2015			Six Months Ended June 30, 2015
Operating results:
Total revenues	$	—		$	—
Total expenses		—			(1	)

Net loss	$	—		$	(1	)

The Company’s share of net loss*	$	(1	)	$	(1	)

*	Included in net investment income in the Company’s consolidated statements of income.


	June 30, 2015		December 31, 2014
Balance Sheet:
Construction in progress – real estate	$	9,616	$	3,612
Cash		407		1,323
Other		55		40

Total assets	$	10,078	$	4,975

Accounts payable	$	982	$	—
Construction loan		3,794		—
Other liabilities		28		—
Members’ capital		5,274		4,975

Total liabilities and members’ capital	$	10,078	$	4,975

Investment in joint venture, at equity	$	4,746	$	4,477

Summary of Real Estate Investment

Real estate investments consist of the following as of June 30, 2015 and December 31, 2014:


	June 30, 2015			December 31, 2014
Land	$	11,476		$	11,476
Land improvements		1,449			1,425
Buildings		3,104			3,097
Other		1,386			1,359

Total, at cost		17,415			17,357
Less: accumulated depreciation and amortization		(1,253	)		(1,107	)

Real estate, net		16,162			16,250
ADC Arrangement classified as real estate investment		6,285			2,888

Real estate investments	$	22,447		$	19,138

Investment Income Summarized

Net investment income (loss), by source, is summarized as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Available-for-sale securities:
Fixed-maturity securities	$	1,051		$	1,055		$	1,877		$	2,052
Equity securities		869			484			1,796			741
Investment expense		(167	)		(124	)		(312	)		(209	)
Limited partnership investments		(197	)		—			(462	)		—
Real estate investments		62			(119	)		(21	)		(403	)
Cash and cash equivalents		162			185			297			359
Other		15			—			29			—

Net investment income	$	1,795		$	1,481		$	3,204		$	2,540

Limited Partnership [Member]

Summary of Unaudited Financial Information and Unaudited Financial Position

The following is the aggregated summarized unaudited financial information of limited partnerships, which in certain cases is presented on a three-month lag due to the unavailability of information at the Company’s respective balance sheet dates. In applying the equity method of accounting, the Company uses the most recently available financial information provided by the general partner of each of these partnerships. The financial statements of these limited partnerships are audited annually.


	Three Months Ended June 30, 2015			Six Months Ended June 30, 2015
Operating results:
Total income (loss)	$	(4,577	)	$	(4,838	)
Total expenses		254			957
Net loss	$	(4,831	)	$	(5,795	)

	June 30, 2015			December 31, 2014
Balance Sheet:
Total assets	$	170,659		$	15,940
Total liabilities	$	951		$	513

- Definition

Tabular disclosure of available-for-sale securities which includes, but is not limited to, changes in the cost basis and fair value, fair value and gross unrealized gain (loss), fair values by type of security, contractual maturity and classification, amortized cost basis, contracts to acquire securities to be accounted for as available-for-sale, debt maturities, transfers to trading, change in net unrealized holding gain (loss) net of tax, continuous unrealized loss position fair value, aggregate losses qualitative disclosures, other than temporary impairment (OTTI) losses or other disclosures related to available for sale securities.

+ References + Details

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

+ References + Details