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Investments
 3 Months Ended
Mar. 31, 2021
Investments, Debt and Equity Securities [Abstract]  
Investments Investments
The following table presents the Company's investments related to insurance operations (Insurance) and investments from other Tiptree investing activities (Tiptree Capital), measured at fair value as of the following periods:
As of March 31, 2021
Tiptree Capital
InsuranceMortgageOtherTotal
Available for sale securities, at fair value, net of allowance for credit losses$409,947 $— $— $409,947 
Loans, at fair value10,832 99,626 — 110,458 
Equity securities105,548 — 39,474 145,022 
Other investments122,417 12,021 84,033 218,471 
Total investments$648,744 $111,647 $123,507 $883,898 

As of December 31, 2020
Tiptree Capital
InsuranceMortgageOtherTotal
Available for sale securities, at fair value, net of allowance for credit losses$377,133 $— $— $377,133 
Loans, at fair value7,795 82,937 — 90,732 
Equity securities98,130 — 25,708 123,838 
Other investments125,833 9,439 84,429 219,701 
Total investments$608,891 $92,376 $110,137 $811,404 
Available for Sale Securities, at fair value, net of allowance for credit losses

All of the Company’s investments in Available for Sale Securities, at fair value, net of allowance for credit losses (AFS securities) as of March 31, 2021 and December 31, 2020 are held by subsidiaries in the insurance business. The following tables present the Company's investments in AFS securities:

As of March 31, 2021
Amortized cost
Allowance for Credit Losses(1)
Gross
unrealized gains		Gross
unrealized losses		Fair value
U.S. Treasury securities and obligations of U.S. government authorities and agencies$206,825 $— $3,964 $(1,054)$209,735 
Obligations of state and political subdivisions45,924 — 1,483 (113)47,294 
Corporate securities107,785 (101)1,424 (575)108,533 
Asset backed securities40,233 — 206 (1,917)38,522 
Certificates of deposit1,356 — — — 1,356 
Obligations of foreign governments4,546 (5)20 (54)4,507 
Total$406,669 $(106)$7,097 $(3,713)$409,947 
As of December 31, 2020
Amortized cost
Allowance for Credit Losses(1)
Gross
unrealized gains		Gross
unrealized losses		Fair value
U.S. Treasury securities and obligations of U.S. government authorities and agencies$191,116 $— $5,245 $(58)$196,303 
Obligations of state and political subdivisions42,583 — 1,768 (1)44,350 
Corporate securities92,761 — 2,181 (1)94,941 
Asset backed securities37,975 — 316 (2,099)36,192 
Certificates of deposit1,355 — — — 1,355 
Obligations of foreign governments3,961 — 31 — 3,992 
Total$369,751 $— $9,541 $(2,159)$377,133 
(1) - Represents the amount of impairment that has resulted from credit-related factors, and therefore was recognized in net realized and unrealized gains (losses) as a credit loss on AFS securities. Amount excludes unrealized losses relating to non-credit factors.

The amortized cost and fair values of AFS securities, by contractual maturity date, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
As of
March 31, 2021December 31, 2020
Amortized CostFair ValueAmortized CostFair Value
Due in one year or less $36,505 $36,902 $30,306 $30,602 
Due after one year through five years167,610 169,987 149,378 153,406 
Due after five years through ten years38,340 38,292 26,621 27,479 
Due after ten years123,981 126,244 125,471 129,454 
Asset backed securities40,233 38,522 37,975 36,192 
Total$406,669 $409,947 $369,751 $377,133 
The following tables present the gross unrealized losses on AFS securities by length of time that individual AFS securities have been in a continuous unrealized loss position for less than twelve months, and twelve months or greater and do not have an allowance for credit losses:
As of March 31, 2021
Less Than or Equal to One YearMore Than One Year
Fair valueGross
unrealized losses		# of SecuritiesFair valueGross unrealized losses# of Securities
U.S. Treasury securities and obligations of U.S. government authorities and agencies
$74,713 $(1,054)172 $1 $— 2 
Obligations of state and political subdivisions9,082 (113)42 — — — 
Corporate securities44,717 (575)178 — — — 
Asset backed securities4,517 (20)20 3,531 (1,897)4 
Obligations of foreign governments1,868 (54)6 — — — 
Total
$134,897 $(1,816)418 $3,532 $(1,897)6 
As of December 31, 2020
Less Than or Equal to One YearMore Than One Year
Fair valueGross
unrealized losses		# of SecuritiesFair valueGross unrealized losses# of Securities
U.S. Treasury securities and obligations of U.S. government authorities and agencies
$15,323 $(58)41 $2 $— 2 
Obligations of state and political subdivisions379 (1)5 — — — 
Corporate securities901 (1)3 — — — 
Asset backed securities— — — 18,927 (2,099)9 
Total
$16,603 $(60)49 $18,929 $(2,099)11 
Management believes that it is more likely than not that the Company will be able to hold the fixed maturity AFS securities that were in an unrealized loss position as of March 31, 2021 until full recovery of their amortized cost basis.

The table below presents a roll-forward of the activity in the allowance for credit losses on AFS securities by type as of March 31, 2021:
Obligations of state and political subdivisionsCorporate securitiesAsset backed securitiesObligations of foreign governmentsTotal
Balance as of December 31, 2019$— $— $— $— $— 
Increase in the allowance for the initial adoption of ASU 2016-13(1)(50)(2)— (53)
Gains from recoveries of amounts previously written off 1 31 2 — 34 
Balance as of March 31, 2020$— $(19)$— $— $(19)
Balance as of December 31, 2020$— $— $— $— $— 
(Increase) in allowance for credit losses— (101)— (5)(106)
Balance as of March 31, 2021$— $(101)$— $(5)$(106)

The Company applies a discounted cash flow model, based on assumptions and model outputs provided by an investment management company, in determining its lifetime expected credit losses on AFS securities. This includes determining the present value of expected future cash flows discounted at the book yield of the security.

The table below presents the amount of credit losses (gains from recoveries) on AFS securities recorded by the Company for the following period:
Three Months Ended
March 31,
20212020
Credit losses (gains from recoveries) on AFS securities$106 $(34)

Pursuant to certain reinsurance agreements and statutory licensing requirements, the Company has deposited invested assets in custody accounts or insurance department safekeeping accounts. The Company cannot remove or replace investments in regulatory deposit accounts without prior approval of the contractual party or regulatory authority, as applicable. The following table presents the Company's restricted investments included in the Company's AFS securities:
As of
March 31,
2021		December 31, 2020
Fair value of restricted investments in trust pursuant to reinsurance agreements$44,268 $44,349 
Fair value of restricted investments for special deposits required by state insurance departments9,341 9,447 
Total fair value of restricted investments$53,609 $53,796 

The following table presents additional information on the Company’s AFS securities:
Three Months Ended
March 31,
20212020
Purchases of AFS securities$68,702 $23,580 
Proceeds from maturities, calls and prepayments of AFS securities$17,740 $19,660 
Gross proceeds from sales of AFS securities$13,645 $5,560 

The following table presents the gross realized gains and gross realized losses from sales and redemptions of AFS securities:
Three Months Ended
March 31,
20212020
Gross realized gains$128 $67 
Gross realized (losses)— (63)
Total net realized gains (losses) from investment sales and redemptions$128 $4 
Loans, at fair value

The following table presents the Company’s investments in loans measured at fair value and the Company’s investments in loans measured at fair value pledged as collateral:
As of March 31, 2021As of December 31, 2020
Fair valueUnpaid principal balance (UPB)Fair value exceeds / (below) UPBPledged as CollateralFair valueUnpaid principal balance (UPB)Fair value exceeds / (below) UPBPledged as Collateral
Insurance:
Corporate loans (1)
$10,832 $14,941 $(4,109)$— $7,795 $12,281 $(4,486)$— 
Mortgage:
Mortgage loans held for sale (2)
99,626 97,043 2,583 97,499 82,937 78,590 4,347 81,630 
Total loans, at fair value$110,458 $111,984 $(1,526)$97,499 $90,732 $90,871 $(139)$81,630 
(1)    The cost basis of Corporate loans was approximately $13,463 and $11,282 at March 31, 2021 and December 31, 2020, respectively.
(2)    As of March 31, 2021 and December 31, 2020, there were two mortgage loans held for sale that were 90 days or more past due, respectively, with a fair value of $334 and $534, respectively.
Equity Securities

Equity securities consist mainly of publicly traded common and preferred stocks. Included within the equity securities balance are 17.0 million shares of Invesque as of March 31, 2021 and December 31, 2020, for which the Company has elected to apply the fair value option. The following table presents information on the cost and fair value of the Company’s equity securities related to insurance operations and other Tiptree investing activity as of the following periods:
As of March 31, 2021
InsuranceTiptree Capital - OtherTotal
CostFair ValueCostFair ValueCostFair Value
Invesque$23,339 $8,245 $111,491 $39,474 $134,830 $47,719 
Fixed income exchange traded fund62,438 64,293 — — 62,438 64,293 
Other equity securities36,337 33,010 — — 36,337 33,010 
Total equity securities$122,114 $105,548 $111,491 $39,474 $233,605 $145,022 

As of December 31, 2020
InsuranceTiptree Capital - OtherTotal
CostFair ValueCostFair ValueCostFair Value
Invesque$23,339 $5,370 $111,491 $25,708 $134,830 $31,078 
Fixed income exchange traded fund62,438 63,875 — — 62,438 63,875 
Other equity securities38,069 28,885 — — 38,069 28,885 
Total equity securities$123,846 $98,130 $111,491 $25,708 $235,337 $123,838 
Other Investments

The following table contains information regarding the Company’s other investments as of the following periods:
As of March 31, 2021
Tiptree Capital
InsuranceMortgageOtherTotal
Corporate bonds, at fair value (1)
$101,296 $— $— $101,296 
Vessels, net (2)
— — 82,657 82,657 
Debentures20,377 — — 20,377 
Other744 12,021 1,376 14,141 
Total other investments$122,417 $12,021 $84,033 $218,471 

As of December 31, 2020
Tiptree Capital
InsuranceMortgageOtherTotal
Corporate bonds, at fair value (1)
$105,777 $— $— $105,777 
Vessels, net (2)
— — 83,028 83,028 
Debentures17,703 — — 17,703 
Other2,353 9,439 1,401 13,193 
Total other investments$125,833 $9,439 $84,429 $219,701 

(1)    The cost basis of corporate bonds was $95,644 and $97,284 as of March 31, 2021 and December 31, 2020, respectively.
(2)     Net of accumulated depreciation of $9,515 and $8,372 as of March 31, 2021 and December 31, 2020, respectively.
Net Investment Income - Insurance

Net investment income represents investment income and expense from investments related to insurance operations as disclosed within net investment income on the condensed consolidated statements of operations. The following table presents the components of net investment income by source of income:
Three Months Ended
March 31,
20212020
Interest:
AFS securities$1,724 $2,281 
Loans, at fair value205 173 
Other investments1,282 855 
Dividends from equity securities89 591 
Other20 — 
Subtotal3,320 3,900 
Less: investment expenses553 412 
Net investment income$2,767 $3,488 

Other Investment Income - Tiptree Capital

Other investment income represents other revenue from other Tiptree non-insurance activities as disclosed within other revenue on the condensed consolidated statements of operations, see Note (16) Other Revenue and Other Expenses. The following tables present the components of other investment income by type:
Three Months Ended
March 31,
20212020
Interest:
Loans, at fair value (1)
$1,672 $1,731 
Dividends from equity securities— 2,533 
Loan fee income5,362 3,554 
Vessel related revenue5,699 7,246 
Other investment income$12,733 $15,064 
(1)    Primarily relates to Loans, at fair value classified as Held for Sale. See Note (4) Assets and Liabilities Held for Sale.


Net Realized and Unrealized Gains (Losses)

The following table presents the components of net realized and unrealized gains (losses) recorded on the condensed consolidated statements of operations. Net unrealized gains (losses) on AFS securities are included within other comprehensive income (loss) (OCI), net of tax, and, as such, are not included in this table. Net realized and unrealized gains (losses) on non-investment related financial assets and liabilities are included below:
Three Months Ended
March 31,
20212020
Net realized gains (losses)
Insurance:
Reclass of unrealized gains (losses) on AFS securities from OCI $128 $4 
Gains from recoveries (credit losses) on AFS securities(106)34 
Net realized gains (losses) on loans — (1,518)
Net realized gains (losses) on equity securities (1,853)(16,564)
Net realized gain on corporate bonds1,816 4 
Other 2,577 734 
Tiptree Capital
Mortgage:
Net realized gains (losses) on loans24,733 17,520 
Other965(1,377)
Other:
Net realized gains (losses) on loans (1)
13,887 6,837 
Other 669 (350)
Total net realized gains (losses)42,816 5,324 
Net unrealized gains (losses)
Insurance:
Net change in unrealized gains (losses) on loans 856 (2,160)
Net unrealized gains (losses) on equity securities held at period end11,087 (25,770)
Reclass of unrealized (gains) losses from prior periods for equity securities sold (1,211)16,252 
Other (3,622)(4,619)
Tiptree Capital
Mortgage:
Net change in unrealized gains (losses) on loans(1,642)(401)
Other6,023 (3,027)
Other:
Net change in unrealized gains (losses) on loans (1)
(1,900)(252)
Net unrealized gains (losses) on equity securities held at period end13,767 (48,551)
Other 3,197 763 
Total net unrealized gains (losses)26,555 (67,765)
Total net realized and unrealized gains (losses)$69,371 $(62,441)
(1)    Primarily relates to Loans, at fair value classified as Held for Sale. See Note (4) Assets and Liabilities Held for Sale.