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Fair Value Measurements (Tables) | 9 Months Ended
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Sep. 30, 2015
Company's Invested Assets and Derivative Instruments Measured at Fair Value on Recurring Basis | The following table presents information about the Company’s invested assets and derivative instruments measured at fair value on a recurring basis as of September 30, 2015 and December 31, 2014, and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value.
As of September 30, 2015 |  | Fair Value Measurements |
(Dollars in thousands) |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and agency obligations |  | $ | 91,341 |  |  | $ | 5,934 |  |  | $ | — |  |  | $ | 97,275 |
Obligations of states and political subdivisions |  |  | — |  |  |  | 235,400 |  |  |  | — |  |  |  | 235,400 |
Mortgage-backed securities |  |  | — |  |  |  | 188,403 |  |  |  | — |  |  |  | 188,403 |
Commercial mortgage-backed securities |  |  | — |  |  |  | 160,076 |  |  |  | — |  |  |  | 160,076 |
Asset-backed securities |  |  | — |  |  |  | 278,834 |  |  |  | — |  |  |  | 278,834 |
Corporate bonds |  |  | — |  |  |  | 461,294 |  |  |  | — |  |  |  | 461,294 |
Foreign corporate bonds |  |  | — |  |  |  | 127,603 |  |  |  | — |  |  |  | 127,603 |
Total fixed maturities |  |  | 91,341 |  |  |  | 1,457,544 |  |  |  | — |  |  |  | 1,548,885 |
Common stock |  |  | 106,666 |  |  |  | — |  |  |  | — |  |  |  | 106,666 |
Other invested assets |  |  | — |  |  |  | — |  |  |  | 33,555 |  |  |  | 33,555 |
Total assets measured at fair value |  | $ | 198,007 |  |  | $ | 1,457,544 |  |  | $ | 33,555 |  |  | $ | 1,689,106 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments |  | $ | — |  |  | $ | 18,522 |  |  | $ | — |  |  | $ | 18,522 |
Total liabilities measured at fair value |  | $ | — |  |  | $ | 18,522 |  |  | $ | — |  |  | $ | 18,522 |
As of December 31, 2014 |  | Fair Value Measurements |
(Dollars in thousands) |  | Level 1 |  |  | Level 2 |  |  | Level 3 |  |  | Total |
Assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Fixed maturities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
U.S. treasury and agency obligations |  | $ | 74,765 |  |  | $ | 6,002 |  |  | $ | — |  |  | $ | 80,767 |
Obligations of states and political subdivisions |  |  | — |  |  |  | 191,473 |  |  |  | — |  |  |  | 191,473 |
Mortgage-backed securities |  |  | — |  |  |  | 208,759 |  |  |  | — |  |  |  | 208,759 |
Commercial mortgage-backed securities |  |  | — |  |  |  | 133,158 |  |  |  | — |  |  |  | 133,158 |
Asset-backed securities |  |  | — |  |  |  | 178,263 |  |  |  | — |  |  |  | 178,263 |
Corporate bonds |  |  | — |  |  |  | 383,416 |  |  |  | — |  |  |  | 383,416 |
Foreign corporate bonds |  |  | — |  |  |  | 107,639 |  |  |  | — |  |  |  | 107,639 |
Total fixed maturities |  |  | 74,765 |  |  |  | 1,208,710 |  |  |  | — |  |  |  | 1,283,475 |
Common stock |  |  | 122,048 |  |  |  | — |  |  |  | — |  |  |  | 122,048 |
Other invested assets |  |  | — |  |  |  | — |  |  |  | 33,663 |  |  |  | 33,663 |
Total assets measured at fair value |  | $ | 196,813 |  |  | $ | 1,208,710 |  |  | $ | 33,663 |  |  | $ | 1,439,186 |
Liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Derivative instruments |  | $ | — |  |  | $ | 13,675 |  |  | $ | — |  |  | $ | 13,675 |
Total liabilities measured at fair value |  | $ | — |  |  | $ | 13,675 |  |  | $ | — |  |  | $ | 13,675 |
Current Fair Value of Debt | For the Company’s material debt arrangements, the current fair value of the Company’s debt was as follows:
(Dollars in thousands) |  | Carrying Value |  |  | Fair Value |
Margin Borrowing Facilities |  | $ | 195,787 |  |  | $ | 195,787 |
7.75% Subordinated Notes due 2045 (1) |  |  | 96,357 |  |  |  | 90,117 |
Total |  | $ | 292,144 |  |  | $ | 285,904 |
(1) | As of September 30, 2015, the carrying value and fair value of the 7.75% Subordinated Notes due 2045 are net of unamortized debt issuance cost of $3.6 million.
Changes in Level 3 Investments Measured at Fair Value on a Recurring Basis | The following table presents changes in Level 3 investments measured at fair value on a recurring basis for the quarters and nine months ended September 30, 2015 and 2014:
|  | Quarters Ended September 30, |  |  | Nine Months Ended September 30, |
(Dollars in thousands) |  | 2015 |  |  | 2014 |  |  | 2015 |  |  | 2014 |
Beginning balance |  | $ | 31,176 |  |  | $ | 15,034 |  |  | $ | 33,663 |  |  | $ | 3,489 |
Total gains (losses) (realized / unrealized): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Included in accumulated other comprehensive income (loss) |  |  | 23 |  |  |  | (404 | ) |  |  | 481 |  |  |  | (834 | )
Investment Income: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Equity in Limited Partnership |  |  | 106 |  |  |  | — |  |  |  | 1,448 |  |  |  | — |
Purchases |  |  | 2,250 |  |  |  | 6,500 |  |  |  | 2,250 |  |  |  | 18,475 |
Distributions |  |  | — |  |  |  | (12 | ) |  |  | (4,287 | ) |  |  | (12 | )
Ending balance |  | $ | 33,555 |  |  | $ | 21,118 |  |  | $ | 33,555 |  |  | $ | 21,118 |
Fair Value and Future Funding Commitments Related to These Investments | The following table provides the fair value and future funding commitments related to these investments at September 30, 2015 and December 31, 2014.
|  | September 30, 2015 |  |  | December 31, 2014 |
(Dollars in thousands) |  | Fair Value |  |  | Future Funding Commitment |  |  | Fair Value |  |  | Future Funding Commitment |
Equity Fund, LP (1) |  | $ | 3,348 |  |  | $ | 2,391 |  |  | $ | 3,401 |  |  | $ | 2,436 |
Real Estate Fund, LP (2) |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
European Non-Performing Loan Fund, LP (3) |  |  | 30,207 |  |  |  | 21,314 |  |  |  | 30,262 |  |  |  | 20,064 |
Total |  | $ | 33,555 |  |  | $ | 23,705 |  |  | $ | 33,663 |  |  | $ | 22,500 |
(1) | This limited partnership invests in companies from various business sectors whereby the partnership has acquired control of the operating business as a lead or organizing investor. The Company does not have the ability to sell or transfer its limited partnership interest without consent from the general partner. The Company does not have the contractual option to redeem its limited partnership interest but receives distributions based on the liquidation of the underlying assets. The Company anticipates its interest in this partnership to be redeemed during the 4th quarter of 2015.
(2) | This limited partnership invests in real estate assets through a combination of direct or indirect investments in partnerships, limited liability companies, mortgage loans, and lines of credit. The Company does not have the contractual option to redeem its limited partnership interest but receives distributions based on the liquidation of the underlying assets. The Company does not have the ability to sell or transfer its limited partnership interest without consent from the general partner. The Company continues to hold an investment in this limited partnership and has written the fair value down to zero.
(3) | This limited partnership invests in distressed securities and assets through senior and subordinated, secured and unsecured debt and equity, in both public and private large-cap and middle-market companies. The Company does not have the ability to sell or transfer its limited partnership interest without consent from the general partner. The Company does not have the contractual option to redeem its limited partnership interest but receives distributions based on the liquidation of the underlying assets. Based on the terms of the partnership agreement, the Company anticipates its interest in this partnership to be redeemed in 2020.

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- Definition Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19279-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a,b,bb) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2C -URI http://asc.fasb.org/extlink&oid=36462937&loc=SL7498348-110258 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19190-110258 + Details
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- Definition Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3). + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a),(b) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19190-110258 + Details
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- Definition Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (c) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19279-110258 + Details
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- Definition Tabular disclosure of the fair value of financial instruments, including financial assets and financial liabilities, and the measurements of those instruments, assets, and liabilities. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 12 -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13476-108611 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 820 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=36462937&loc=d3e19207-110258 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13467-108611 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 45 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6447952&loc=d3e13220-108610 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 30 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6957238&loc=d3e14172-108612 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 825 -SubTopic 10 -Section 50 -Paragraph 10 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=49121117&loc=d3e13433-108611 + Details
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