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Statutory Accounting and Regulatory Requirements

12 Months Ended

Dec. 31, 2012

Statutory Accounting and Regulatory Requirements [Abstract]

Statutory Accounting and Regulatory Requirements

11.

Statutory Accounting and Regulatory Requirements

The Company’s insurance subsidiaries file financial statements prepared in accordance with statutory accounting principles prescribed or permitted by the insurance regulatory authorities of the states in which the subsidiaries are domiciled. Statutory-basis shareholder’s capital and surplus at December 31, 2012, 2011 and 2010 of the directly owned insurance subsidiary, AIIC, and the combined statutory-basis net income and realized investment gains for all AMERISAFE’s insurance subsidiaries for the three years in the period ended December 31, 2012, were as follows (in thousands):


	2012		2011		2010
Capital and surplus	$	323,932	$	314,397	$	320,388
Net income		31,059		26,969		30,484
Realized investment gains (losses)		2,958		2,121		3,040

Property and casualty insurance companies are subject to certain risk-based capital (“RBC”) requirements specified by the National Association of Insurance Commissioners. Under these requirements, a target minimum amount of capital and surplus maintained by a property/casualty insurance company is determined based on the various risk factors related to it. At December 31, 2012, the capital and surplus of AIIC and its subsidiaries exceeded the minimum RBC requirement.

Pursuant to regulatory requirements, AIIC cannot pay dividends to the Company in excess of the lesser of 10% of statutory surplus, or statutory net income, excluding realized investment gains, for the preceding 12-month period, without the prior approval of the Louisiana Commissioner of Insurance. However, for purposes of this dividend calculation, net income from the previous two calendar years may be carried forward to the extent that it has not already been paid out as dividends. AIIC paid $21.0 million in dividends to the Company in 2012, $32.0 million in 2011 and $32.3 million in 2010. Based upon the dividend limitation described above, AIIC could pay to the Company dividends of up to $32.4 million after March of 2013 without seeking regulatory approval.