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Deferred Policy Acquisition Costs
 12 Months Ended
Dec. 31, 2015
Insurance [Abstract]  
Deferred Policy Acquisition Costs
4. Deferred Policy Acquisition Costs

Deferred policy acquisition costs represent those costs that are incremental and directly related to the successful acquisition of new or the renewal of existing insurance contracts. We defer incremental costs that result directly from, and are essential to, the acquisition or renewal of an insurance contract.

We also defer a portion of employee total compensation costs directly related to time spent performing specific acquisition or renewal activities.

These costs are deferred and expensed over the life of the related policies. Major categories of the Company’s deferred policy acquisition costs are summarized as follows:

 

    December 31,  
    2015     2014  
    (in thousands)  

Agents’ commissions

   $ 15,997      $ 15,351   

Premium taxes

     3,121        3,100   

Deferred underwriting expenses

     1,294        1,198   
 

 

 

    

 

 

  

Total deferred policy acquisition costs

   $       20,412      $       19,649   
 

 

 

    

 

 

  

The following summarizes the activity in the deferred policy acquisition costs:

 

    Year Ended December 31,  
    2015     2014     2013  
    (in thousands)  

Balance, beginning of year

   $ 19,649      $ 19,171      $ 18,419   

Policy acquisition costs deferred

     45,604        44,295        41,278   

Amortization expense during the year

     (44,841 )      (43,817 )      (40,526 ) 
 

 

 

    

 

 

    

 

 

  

Balance, end of year

   $       20,412      $       19,649      $       19,171