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Investments

12 Months Ended

Dec. 31, 2022

Investments, Debt and Equity Securities [Abstract]

Investments

INVESTMENTS

Available-for-Sale Securities

The following table provides the amortized cost and fair value of available-for-sale debt securities as of the dates presented (in thousands):

						December 31, 2022
						Amortized Cost						Allowance for Expected Credit Losses						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Debt Securities:
U.S. government obligations and agencies						$	12,602					$	—					$	—					$	(938)					$	11,664
Corporate bonds						788,737						(729)						130						(93,077)						695,061
Mortgage-backed and asset-backed securities						327,166						—						148						(39,707)						287,607
Municipal bonds						14,924						(2)						—						(2,551)						12,371
Redeemable preferred stock						9,423						(189)						—						(1,311)						7,923
Total						$	1,152,852					$	(920)					$	278					$	(137,584)					$	1,014,626

						December 31, 2021
						Amortized Cost						Allowance for Expected Credit Losses						Gross Unrealized Gains						Gross Unrealized Losses						Fair Value
Debt Securities:
U.S. government obligations and agencies						$	27,076					$	—					$	64					$	(334)					$	26,806
Corporate bonds						687,058						(371)						843						(13,725)						673,805
Mortgage-backed and asset-backed securities						322,844						—						194						(6,920)						316,118
Municipal bonds						14,925						(1)						—						(350)						14,574
Redeemable preferred stock						9,289						(117)						28						(48)						9,152
Total						$	1,061,192					$	(489)					$	1,129					$	(21,377)					$	1,040,455

The following table provides the credit quality of available-for-sale debt securities with contractual maturities as of the dates presented (dollars in thousands):

						December 31, 2022												December 31, 2021
												% of Total												% of Total
Average Credit Ratings						Fair Value						Fair Value						Fair Value						Fair Value
AAA						$	297,475					29.3		%				$	321,975					31.0		%
AA						154,975						15.3		%				139,186						13.4		%
A						327,427						32.3		%				339,500						32.6		%
BBB						232,316						22.9		%				234,358						22.5		%
No Rating Available						2,433						0.2		%				5,436						0.5		%
Total						$	1,014,626					100.0		%				$	1,040,455					100.0		%

The table above includes credit quality ratings by Standard and Poor’s Rating Services, Inc. (“S&P”), Moody’s Investors Service, Inc. and Fitch Ratings, Inc. The Company has presented the highest rating of the three rating agencies for each investment position.

The following table summarizes the amortized cost and fair value of mortgage-backed and asset-backed securities as of the dates presented (in thousands):

						December 31, 2022												December 31, 2021
						Amortized Cost						Fair Value						Amortized Cost						Fair Value
Mortgage-backed securities:
Agency						$	157,672					$	133,928					$	147,992					$	143,819
Non-agency						60,328						50,478						59,906						58,263
Asset-backed securities:
Auto loan receivables						62,128						59,370						67,352						66,877
Credit card receivables						657						612						4,741						4,719
Other receivables						46,381						43,219						42,853						42,440
Total						$	327,166					$	287,607					$	322,844					$	316,118

The following tables summarize available-for-sale debt securities, aggregated by major security type and length of time that individual securities have been in a continuous unrealized loss position, for which no allowance for expected credit losses has been recorded as of the dates presented (in thousands):

						December 31, 2022
						Less Than 12 Months																		12 Months or Longer
						Number of Issues						Fair Value						Unrealized Losses						Number of Issues						Fair Value						Unrealized Losses
Debt Securities:
U.S. government obligations and agencies						2						$	2,721					$	(110)					5						$	8,943					$	(828)
Corporate bonds						40						26,563						(2,910)						247						325,992						(46,451)
Mortgage-backed and asset-backed securities						64						52,751						(2,974)						146						219,189						(36,733)
Municipal bonds						—						—						—						3						6,621						(1,458)
Redeemable preferred stock						1						95						(51)						—						—						—
Total						107						$	82,130					$	(6,045)					401						$	560,745					$	(85,470)

						December 31, 2021
						Less Than 12 Months																		12 Months or Longer
						Number of Issues						Fair Value						Unrealized Losses						Number of Issues						Fair Value						Unrealized Losses
Debt Securities:
U.S. government obligations and agencies						4						$	18,913					$	(111)					4						$	5,016					$	(223)
Corporate bonds						249						378,595						(7,468)						18						17,356						(679)
Mortgage-backed and asset-backed securities						145						274,883						(5,969)						11						23,273						(951)
Municipal bonds						5						9,811						(269)						—						—						—
Redeemable preferred stock						1						200						(1)						—						—						—
Total						404						$	682,402					$	(13,818)					33						$	45,645					$	(1,853)

Unrealized losses on available-for-sale debt securities in the above table as of December 31, 2022 and 2021 have not been recognized into income as credit losses because the issuers are of high credit quality (investment grade securities), management does not intend to sell and it is likely management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There were no material factors impacting any one category or specific security requiring an accrual for credit loss. The issuers continue to make principal and interest payments on the bonds. The fair value is expected to recover as the bonds approach maturity.

The following table presents a reconciliation of the beginning and ending balances for expected credit losses on available-for-sale debt securities (in thousands):

						Corporate Bonds						Municipal Bonds						Redeemable  Preferred Stock						Total
Balance, December 31, 2020						$	148					$	—					$	38					$	186
Provision for (or reversal of) credit loss expense						223						1						79						303
Balance, December 31, 2021						371						1						117						489
Provision for (or reversal of) credit loss expense						358						1						72						431
Balance, December 31, 2022						$	729					$	2					$	189					$	920

See “—Note 2 (Summary of Significant Accounting Policies — Allowance for Credit Losses-Available-For-Sale Securities)” for more information about the methodology and significant inputs used to measure the amount related to expected credit losses on available-for-sale debt securities.

The following table presents the amortized cost and fair value of investments with maturities as of the date presented (in thousands): 

						December 31, 2022
						Amortized Cost						Fair Value
Due in one year or less						$	76,691					$	75,226
Due after one year through five years						569,239						516,320
Due after five years through ten years						479,147						401,132
Due after ten years						25,231						19,831
Perpetual maturity securities						2,544						2,117
Total						$	1,152,852					$	1,014,626

All securities, except those with perpetual maturities, were categorized in the table above utilizing years to effective maturity. Effective maturity takes into consideration all forms of potential prepayment, such as call features or prepayment schedules, that shorten the lifespan of contractual maturity dates.

The following table provides certain information related to available-for-sale debt securities, equity securities and investment real estate during the periods presented (in thousands):

						Years Ended December 31,
						2022						2021						2020
Proceeds from sales and maturities (fair value):
Available-for-sale debt securities (1)						$	98,409					$	186,507					$	1,148,418
Equity securities						$	34,178					$	85,103					$	81,559
Gross realized gains on sale of securities:
Available-for-sale debt securities (1)						$	242					$	2,649					$	57,378
Equity securities						$	2,240					$	3,005					$	6,438
Gross realized losses on sale of securities:
Available-for-sale debt securities						$	(2,060)					$	(2,434)					$	(464)
Equity securities						$	(74)					$	(208)					$	—
Realized gains on sales of investment real estate (2)						$	—					$	401					$	—

(1)						In the third and fourth quarters of 2020, the Company took advantage of the market recovery and recognized $56.4 million of net realized gains on the sale of our available-for-sale debt securities that were in an unrealized gain position that is included in net realized gains (losses) on investment in the Consolidated Statements of Income for the year ended December 31, 2020.
(2)						During the year ended December 31, 2021 the Company completed the sale of a non-income producing investment real estate property. The Company received net cash proceeds of approximately $2.6 million and recognized a pre-tax gain of approximately $0.4 million that is included in net realized gains (losses) on investments in the Consolidated Statements of Income for the year ended December 31, 2021. This investment real estate property was not previously reported under assets held for sale since it was actively marketed and sold within the first quarter of 2021.

The following table presents the components of net investment income, comprised primarily of interest and dividends for the periods presented (in thousands):

						Years Ended December 31,
						2022						2021						2020
Available-for-sale debt securities						$	18,699					$	11,926					$	19,091
Equity securities						3,288						2,651						2,445
Cash and cash equivalents (1)						5,945						51						960
Other (2)						492						928						1,050
Total investment income						28,424						15,556						23,546
Less: Investment expenses (3)						(2,639)						(3,021)						(3,153)
Net investment income						$	25,785					$	12,535					$	20,393

(1)			Includes interest earned on restricted cash and cash equivalents.
(2)			Includes investment income earned on real estate investments.
(3)			Includes custodial fees, investment accounting and advisory fees, and expenses associated with real estate investments.

Equity Securities

The following table provides the unrealized gains (losses) recognized for the periods presented on equity securities still held at the end of the reported period (in thousands):

						Years Ended December 31,
						2022						2021						2020
Unrealized gains (losses) recognized during the reported period    on equity securities still held at the end of the reported period						$	(13,197)					$	(3,459)					$	25

Investment Real Estate

Investment real estate consisted of the following as of the dates presented (in thousands):

						As of December 31,
						2022						2021
Income Producing:
Investment real estate						$	7,097					$	7,091
Less: Accumulated depreciation						(1,386)						(1,200)
Investment real estate, net						$	5,711					$	5,891

The following table provides the depreciation expense related to investment real estate for the periods presented (in thousands):

						Years Ended December 31,
						2022						2021						2020
Depreciation expense on investment real estate						$	186					$	186					$	415

Assets Held for Sale Sold during the year ended December 31, 2021

During the first quarter of 2021, the Company committed to a plan to actively market an income-producing investment real estate property and classified the investment property to assets held for sale. On September 30, 2021, the Company completed the sale and received net cash proceeds of approximately $8.9 million and recognized a pre-tax gain of approximately $2.3 million that is included in net realized gains (losses) on investments in the Consolidated Statements of Income for the year ended December 31, 2021.

During the second quarter of 2021, the Company committed to a plan to actively market the sale of a real estate property previously included in property and equipment, net and classified the real estate property to assets held for sale. The real estate property was located in Pompano Beach, Florida. On October 8, 2021, the Company completed the sale and received net cash proceeds of approximately $0.4 million and recognized a pre-tax gain of approximately $0.2 million that is included in net realized gains (losses) on investments in the Consolidated Statements of Income for the year ended December 31, 2021.

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- Definition

The entire disclosure for investment.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 321
-URI https://asc.fasb.org/topic&trid=75115024

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 320
-URI https://asc.fasb.org/topic&trid=2196928

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 325
-URI https://asc.fasb.org/topic&trid=2197064

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-URI https://asc.fasb.org/topic&trid=2196965

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- References

No definition available.

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