SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549


☒
~~[ X ]~~	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐
~~[ ]~~	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________________ to ___________________

North Carolina

56-1110199

~~North Carolina~~

~~56-1110199~~

(State of incorporation)

(I.R.S. Employer Identification No.)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X ☒No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). Yes X ☒No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. ~~(Check one):~~

Large accelerated filer

☐

Accelerated filer

☒

Non-accelerated filer

☐

~~(Do not check if a smaller reporting company)~~

Smaller reporting company

☒

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ~~___~~ ☐No X ☒

As of ~~October 17, 2017~~,April 24, 2024, there were ~~1,887,026~~1,883,860 common shares of the ~~registrant~~registrant outstanding.

INVESTORS TITLE COMPANY


PART I.		FINANCIAL INFORMATION

~~PART I.~~Item 1.		~~FINANCIAL INFORMATION~~Financial Statements (unaudited):

~~Item 1.~~		~~Financial Statements:~~

	Consolidated Balance Sheets as of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016~~2023		1

		Consolidated Statements of ~~Income~~Operations For the Three~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023		2

		Consolidated Statements of Comprehensive Income For the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023		3

		Consolidated Statements of Stockholders’ Equity For the ~~Nine~~ Three Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023		4

		Consolidated Statements of Cash Flows For the ~~Nine~~ Three Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023		5

		Notes to Consolidated Financial Statements		7

Item 2.		Management's Discussion and Analysis of Financial Condition and Results of Operations		2422

Item 3.		Quantitative and Qualitative Disclosures About Market Risk		3634

Item 4.		Controls and Procedures		3634

PART II.		OTHER INFORMATION

Item 1.		Legal Proceedings		3735

Item ~~1a.~~1A.		Risk Factors		3735

Item 2.		Unregistered Sales of Equity Securities and Use of Proceeds		3735

Item 3.		Defaults Upon Senior Securities		3735

Item 4.		Mine Safety Disclosures		3735

Item 5.		Other Information		3835

Item 6.		Exhibits		3936


SIGNATURE				4037

Item 1. Financial Statements

Investors Title Company and Subsidiaries

Consolidated Balance Sheets

As of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016~~2023

~~(Unaudited)~~(in thousands)

Investors Title Company and Subsidiaries

Consolidated Statements of ~~Income~~Operations

For the Three ~~and Nine~~ Months Ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023

~~(Unaudited)~~(in thousands, except per share amounts)

Investors Title Company and Subsidiaries

Consolidated Statements of Comprehensive Income

For the Three Months Ended March 31, 2024 and ~~Nine~~ ~~Months~~ ~~September 30, 2017~~ ~~and~~ ~~2016~~2023

~~(Unaudited)~~(in thousands)

Investors Title Company and Subsidiaries

Consolidated Statements of Stockholders’ Equity

For the ~~Nine~~Three Months Ended ~~September 30,2017~~March 31, 2024 and ~~2016~~2023

~~(Unaudited)~~

(in thousands, except per share amounts)

Common Stock Retained Earnings

Accumulated
Other
Comprehensive
Income

Noncontrolling
Interests

Total
Stockholders’
Equity

Shares Amount
Balance, January 1, 2016 1,949,797
$ 1
$ 131,186,866
$ 11,483,015
$ 107,198
$ 142,777,080
Net income attributable to the Company

14,470,359

14,470,359
Dividends paid ($0.52 per share)

(993,534 )
(993,534 )
Repurchases of common stock (66,803 )
(6,219,670 )
(6,219,670 )
Exercise of stock appreciation rights 1,289

(200 )
(200 )
Share-based compensation expense related to stock appreciation rights

99,755

99,755
Amortization related to postretirement health benefits

4,426
4,426
Net unrealized gain on investments

1,962,117
1,962,117
Net loss attributable to noncontrolling interests (6,684 ) (6,684 )
Purchase of noncontrolling interest of subsidiary (8,646 ) (8,646 )
Additional paid-in capital from purchase of noncontrolling interest of subsidiary (496 ) (496 )
Income tax benefit from share-based compensation 32,292
32,292
Balance, September 30, 2016 1,884,283
$ 1
$ 138,575,372
$ 13,449,558
$ 91,868
$ 152,116,799

Balance, January 1, 2017 1,884,283
$ 1
$ 143,283,621
$ 11,761,447
$ 90,885
$ 155,135,954
Net income attributable to the Company

16,077,704

16,077,704
Dividends paid ($0.95 per share)

(1,792,430 )
(1,792,430 )
Repurchases of common stock (300 )
(49,604 )
(49,604 )
Exercise of stock appreciation rights 3,043

(737 )
(737 )
Share-based compensation expense related to stock appreciation rights

156,987

156,987
Amortization related to postretirement health benefits

4,265
4,265
Net unrealized gain on investments

2,609,982
2,609,982
Net loss attributable to noncontrolling interests (10,886 ) (10,886 )
Balance, September 30, 2017 1,887,026
$ 1
$ 157,675,541
$ 14,375,694
$ 79,999
$ 172,131,235
(unaudited)


	Common Stock			Retained Earnings		Accumulated Other Comprehensive Income		Total Stockholders’ Equity
	Shares	Amount
Balance, December 31, 2022	1,897	$	—	$	240,811	$	200	$	241,011
Net income				1,181				1,181
Dividends paid ($0.46 per share)				(873)				(873)
Exercise of stock appreciation rights	1			—				—
Share-based compensation expense related to stock appreciation rights				159				159
Accumulated postretirement benefit obligation adjustment						111		111
Net unrealized gain on investments						249		249
Balance, March 31, 2023	1,898	$	—	$	241,278	$	560	$	241,838

Balance, December 31, 2023	1,891	$	—	$	250,915	$	638	$	251,553
Net income				4,525				4,525
Dividends paid ($0.46 per share)				(867)				(867)
Shares of common stock repurchased and retired	(7)			(1,053)				(1,053)
Share-based compensation expense related to stock appreciation rights				96				96
Net unrealized loss on investments						(292)		(292)
Balance, March 31, 2024	1,884	$	—	$	253,616	$	346	$	253,962

Investors Title Company and Subsidiaries

Consolidated Statements of Cash Flows

For the ~~Nine~~Three Months Ended ~~September 30,2017~~March 31, 2024 and ~~2016~~2023

~~(Unaudited)~~(in thousands)


	Three Months Ended March 31,
	2024		2023
Operating Activities
Net income	$	4,525	$	1,181
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation	787		639
Accretion of investments, net	(1,232)		(865)
Amortization of other intangible assets, net	339		332
Share-based compensation expense related to stock appreciation rights	96		159
Net (gain) loss on disposals of property	(13)		50
Net investment gains	(2,422)		(443)
Net losses (earnings) from other investments	14		(568)
Provision for claims	910		1,068
Benefit for deferred income taxes	(92)		(1,910)
Changes in assets and liabilities:
Decrease in premium and fees receivable	427		2,220
Decrease (increase) in other assets	3,354		(265)
(Increase) decrease in lease assets	(376)		36
Decrease in current income taxes receivable	1,081		1,174
Decrease in accounts payable and accrued liabilities	(5,881)		(15,693)
Increase (decrease) in lease liabilities	379		(13)
Increase in current income taxes payable	282		1,148
Payments of claims, net of recoveries	(741)		(1,342)
Net cash provided by (used in) operating activities	1,437		(13,092)

Investing Activities
Purchases of fixed maturity securities	(757)		(2,705)
Purchases of equity securities	(2,470)		(3,627)
Purchases of short-term investments	(32,751)		(18,800)
Purchases of other investments	(5,178)		(970)
Proceeds from sales and maturities of fixed maturity securities	1,625		4,712
Proceeds from sales of equity securities	5,323		13,090
Proceeds from sales and maturities of short-term investments	31,107		17,654
Proceeds from sales and distributions of other investments	3,379		913
Purchases of property	(2,230)		(2,301)
Proceeds from the sale of property	17		243
Net cash (used in) provided by investing activities	(1,935)		8,209

Financing Activities
Repurchases of common stock	(1,053)		—
Dividends paid	(867)		(873)
Net cash used in financing activities	(1,920)		(873)

Net Decrease in Cash and Cash Equivalents	(2,418)		(5,756)
Cash and Cash Equivalents, Beginning of Period	24,031		35,311
Cash and Cash Equivalents, End of Period	$	21,613	$	29,555

Nine Months Ended September 30,
2017 2016
Operating Activities
Net income $ 16,066,818
$ 14,463,675
Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation 1,054,830
994,619
Amortization of investments, net 572,781
624,882
Amortization related to postretirement benefits obligation 6,459
6,705
Amortization of other intangible assets, net 707,696
—
Share-based compensation expense related to stock appreciation rights 156,987
99,755
Excess tax benefits related to exercise of stock appreciation rights 142,280
32,292
Net gain on disposals of property (15,828 ) (10,677 )
Net realized gain on investments (990,118 ) (574,328 )
Net earnings from other investments (1,251,871 ) (1,120,640 )
Provision (benefit) for claims 2,714,717
(403,982 )
Provision for deferred income taxes 1,923,000
4,040,000
Changes in assets and liabilities:

Increase in receivables (1,606,006 ) (965,873 )
(Increase) decrease in other assets (43,707 ) 1,265,172
Increase in current income taxes recoverable (1,641,144 ) (1,261,289 )
Increase (decrease) in accounts payable and accrued liabilities 5,253,825
(337,935 )
Decrease in current income taxes payable (1,374,712 ) (210,355 )
Payments of claims, net of recoveries (2,812,717 ) (1,848,018 )
Net cash provided by operating activities 18,863,290
14,794,003

Investing Activities

Purchases of available-for-sale securities (12,953,436 ) (15,066,182 )
Purchases of short-term investments (15,667,715 ) (1,890,826 )
Purchases of other investments (1,223,853 ) (1,974,275 )
Purchase of noncontrolling interest of subsidiary —
(9,142 )
Purchase of subsidiary (175,000 ) —
Proceeds from sales and maturities of available-for-sale securities 14,585,324
10,711,195
Proceeds from sales and maturities of short-term investments 1,535,773
4,830,935
Proceeds from sales and distributions of other investments 2,142,854
2,594,042
Proceeds from sales of other assets 13,230
10,647
Purchases of property (2,342,583 ) (1,742,225 )
Proceeds from the sale of property 27,200
64,155
Net cash used in investing activities (14,058,206 ) (2,471,676 )

Financing Activities

Repurchases of common stock (49,604 ) (6,219,670 )
Exercise of stock appreciation rights (737 ) (200 )
Dividends paid (1,792,430 ) (993,534 )
Net cash used in financing activities (1,842,771 ) (7,213,404 )

Net Increase in Cash and Cash Equivalents 2,962,313
5,108,923
Cash and Cash Equivalents, Beginning of Period 27,928,472
21,790,068
Cash and Cash Equivalents, End of Period $ 30,890,785
$ 26,898,991


Consolidated Statements of Cash Flows, continued
	Three Months Ended March 31,
	2024		2023
Supplemental Disclosures:
Cash Paid During the Year for:
Income tax payments (refunds), net	$	1	$	(32)
Non-Cash Investing and Financing Activities:
Non-cash net unrealized loss (gain) on investments, net of deferred tax benefit (provision) of $79 and $(66) for March 31, 2024 and 2023, respectively	$	292	$	(249)
Adjustments to postretirement benefits obligation, net of deferred tax expense of $0 and $(30) for March 31, 2024 and 2023, respectively	$	—	$	(111)

Consolidated Statements of Cash Flows, continued
Nine Months Ended September 30,
2017 2016
Supplemental Disclosures:
Cash Paid During the Year for:
Income tax payments, net $ 9,236,200
$ 3,736,100
Non Cash Investing and Financing Activities:
Non cash net unrealized gain on investments, net of deferred tax provision of $(1,353,729) and $(1,004,593) for September 30, 2017 and 2016, respectively
$ (2,609,982 ) $ (1,962,117 )

INVESTORS TITLE COMPANY

Notes to Consolidated Financial Statements

~~September 30, 2017~~March 31, 2024

~~(Unaudited)~~(unaudited)

Note 1 – Basis of Presentation and Significant Accounting Policies

Reference should be made to the “Notes to Consolidated Financial Statements” appearing in the Annual Report on Form 10-K for the year ended December 31, ~~2016~~2023 of Investors Title Company (the “Company”) for a complete description of the Company’s significant accounting policies.

Principles of Consolidation – The accompanying unaudited Consolidated Financial Statements include the accounts and operations of Investors Title Company and its subsidiaries, and have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") for interim financial information, with the instructions to Form 10-Q and with Article 10 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in annual consolidated financial statements have been condensed or omitted. Earnings attributable to noncontrolling interests in majority-owned title insurance agencies are recorded in the Consolidated Statements of Income. Noncontrolling interests representing the portion of equity not related to the Company's ownership interests are recorded in separate sections of the Consolidated Balance Sheets. All intercompany balances and transactions have been eliminated in consolidation.

In the opinion of management, all adjustments considered necessary for a fair presentation of the financial position, results of operations and cash flows of the Company in the accompanying unaudited Consolidated Financial Statements have been included. All such adjustments are of a normal recurring nature. Operating results for the ~~quarter~~three-month period ended ~~September 30, 2017~~March 31, 2024 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, ~~2017.~~2024 or any other interim period.

~~Immaterial Classification Corrections~~Reclassifications – ~~In previous periods, certain commission~~Certain amounts have been reclassified for consistency with the current period presentation. The reclassifications were between revenue ~~was improperly classified as net premiums written. The issue was identified in~~lines of the ~~2nd quarter of 2017 and, accordingly, the~~unaudited Consolidated Statements of ~~Income have been corrected beginning with the June 30, 2017 Consolidated Financial Statements. The correction resulted in a decrease to previously reported net premiums written~~Operations. These reclassifications are not considered an accounting change and ~~an increase to other revenues of $1,342,905 and $452,630 for the nine-month periods ended September 30, 2017 and 2016, respectively. The immaterial classification correction~~ had no ~~impact to~~effect on the ~~Company’s financial position or~~reported results of ~~operations as previously reported.~~operations.

In the 2nd quarter of 2017, certain net premiums written amounts were improperly classified as other revenues. The issue was identified in the 3rd quarter of 2017 and, accordingly, the Consolidated Statements of Income have been corrected beginning with the September 30, 2017 Consolidated Financial Statements. The correction resulted in an increase to previously reported net premiums written and a decrease to other revenues of $556,996 for the nine-month period ended September 30, 2017. The immaterial classification correction had no impact to the Company’s financial position or results of operations as previously reported.

Subsequent Events – The Company has evaluated through the date of this filing and concluded that there were no material subsequent events requiring adjustment or disclosure ~~subsequent~~ to ~~the date of the~~its unaudited Consolidated Financial ~~Statements at September 30, 2017.~~Statements.

~~Recently Issued Accounting Standards~~ ~~–In March 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2017-08,~~ ~~Receivables - Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities.~~ ASU 2017-08 is intended to enhance the accounting for the amortization of premiums for purchased callable debt securities. Specifically, the ASU shortens the amortization period for certain investments in callable debt securities purchased at a premium by requiring that the premium be amortized to the earliest call date. The amendments do not require an accounting change for securities held at a discount; the discount continues to be amortized to maturity. The update is effective for annual periods beginning after December 15, 2018, and interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact that the recently issued accounting standard will have on the Company's financial position and results of operations, but does not expect it to have a material impact.

Note 2 – ~~Reserves~~Reserve for Claims

~~Transactions~~Activity in the ~~reserves~~reserve for claims for the ~~nine-month~~three-month period ended ~~September 30, 2017~~March 31, 2024 and the year ended December 31, ~~2016~~ ~~are~~2023 is summarized as follows:

September 30, 2017 December 31, 2016
Balance, beginning of period $ 35,305,000
$ 37,788,000
Provision, charged to operations 2,714,717
242,953
Payments of claims, net of recoveries (2,812,717 ) (2,725,953 )
Balance, end of period $ 35,207,000
$ 35,305,000

A summary of the Company’s ~~loss reserves,~~reserve for claims, broken down into its components of known title claims and IBNR, follows:

September 30, 2017 % December 31, 2016 %
Known title claims $ 4,875,038
13.8 $ 4,405,343
12.5
IBNR 30,331,962
86.2 30,899,657
87.5
Total loss reserves $ 35,207,000
100.0 $ 35,305,000
100.0

Claims and losses paid are charged to the ~~reserves~~reserve for claims. Although claims losses are typically paid in cash, occasionally claims are settled by purchasing the interest of the insured or the claimant in the real property. When this event occurs, the Company carries assets at the lower of cost or estimated ~~realizable~~fair value, net of any indebtedness on the property.

Note 3 – Earnings Per Common Share and Share Awards

Basic earnings per common share is computed by dividing net income ~~attributable to the Company~~ by the weighted average number of common shares outstanding during the reporting period. Diluted earnings per common share is computed by dividing net income ~~attributable to the Company~~ by the combination of dilutive potential common stock, comprised of shares issuable under the Company’s share-based compensation plans, and the weighted average number of common shares outstanding during the reporting period. Dilutive common share equivalents include the dilutive effect of in-the-money share-based awards, which are calculated based on the average share price for each period using the treasury stock method. Under the treasury stock method, when share-based awards are assumed to be exercised, (a) the exercise price of a share-based ~~award;~~award and (b) the amount of compensation cost, if any, for future services that the Company has not yet recognized, are assumed to be used to repurchase shares in the current period.

The following table sets forth the computation of basic and diluted earnings per share for the ~~three- and nine-month~~three-month periods ended ~~September 30:~~March 31:

Three Months Ended September 30, Nine Months Ended September 30,
2017 2016 2017 2016
Net income attributable to the Company $ 5,926,457
$ 8,126,939
$ 16,077,704
$ 14,470,359
Weighted average common shares outstanding – Basic 1,887,103
1,888,870
1,886,474
1,915,468
Incremental shares outstanding assuming the exercise of dilutive SARs (share-settled) 9,126
6,722
9,483
6,531
Weighted average common shares outstanding – Diluted 1,896,229
1,895,592
1,895,957
1,921,999
Basic earnings per common share $ 3.14
$ 4.30
$ 8.52
$ 7.55
Diluted earnings per common share $ 3.13
$ 4.29
$ 8.48
$ 7.53

There were ~~4,500~~23 thousand and 24 thousand potential shares excluded from the computation of diluted earnings per share for the ~~three- and nine-month~~three-month periods ended ~~September 30, 2017. There were no potential shares excluded from~~March 31, 2024 and 2023, respectively, due to the ~~computation~~out-of-the-money status of ~~diluted earnings per share for~~ the ~~three- and nine-month periods ended September 30, 2016.~~related share-based awards.

The Company historically has adopted employee stock award plans under which restricted stock, ~~and~~ options or stock appreciation rights ("SARs") ofexercisable for the Company's stock may be granted to key employees or directors of the ~~Company at a price not less than the market value on the date of grant.~~Company. There is currently one active plan from which the Company may grant share-based ~~awards.~~awards and one legacy plan under which equity awards remain outstanding. The awards eligible to be granted under the active plan are limited to SARs, and the maximum aggregate number of shares of common stock of the Company available pursuant to the plan for the grant of SARs is ~~250,000~~250 thousand shares.

Number
Of Shares

Weighted
Average
Exercise Price

Average Remaining
Contractual
Term (Years)

Aggregate
Intrinsic
Value
Outstanding as of January 1, 2016 22,000
$ 57.04
3.93 $ 945,055
SARs granted 4,500
93.87

SARs exercised (2,000 ) 32.00

Outstanding as of December 31, 2016 24,500
$ 65.85
3.85 $ 836,640
SARs granted 4,500
192.71

SARs exercised (4,000 ) 36.38

Outstanding as of September 30, 2017 25,000
$ 93.40
4.23 $ 2,203,100

Exercisable as of September 30, 2017 22,750
$ 83.58
4.00 $ 2,203,100

Unvested as of September 30, 2017 2,250
$ 192.71
6.63 $ —

As of March 31, 2024, the only outstanding awards under the plans were SARs, which expire within seven years or less from the date of grant. All outstanding SARs vest and are exercisable within five years or less from the date of grant, and all SARs issued to date have been share-settled only. There have been no stock options or SARs granted where the exercise price was less than the market price on the date of grant.

A summary of share-based award transactions for all share-based award plans follows:

During the first quarter of 2024, the Company did not issue share-settled SARs to key employees or directors of the Company. During the first quarter of 2023, there was an issuance of 1 thousand share-settled SARs to a director of the Company. The fair value of each ~~award~~SAR is estimated on the date of grant using the Black-Scholes option valuation ~~model with the weighted average assumptions noted in the table shown below.~~model. Expected volatilities are based on both the implied and historical volatility of the Company’s stock. The Company uses historical data to project SAR exercises and pre-exercise forfeitures within the valuation model. The expected term of awards represents the period of time that SARs granted are expected to be outstanding. The interest rate assumed for the expected life of the award is based on the U.S. Treasury yield curve in effect at the time of the grant. ~~The weighted average fair values for the~~

There was approximately $96 thousand and $159 thousand of compensation expense relating to SARs ~~issued during 2017~~vesting on or before March 31, 2024 and ~~2016 were $55.40 and $28.75,~~2023, respectively, ~~and were estimated using the weighted average assumptions shown~~included in personnel expenses in the ~~table below.~~unaudited Consolidated Statements of Operations. As of March 31, 2024, there was $311 thousand of unrecognized compensation expense related to unvested share-based compensation arrangements granted under the Company’s stock award plans.

Note 4 – Segment Information

The Company has ~~one~~two reportable ~~segment,~~segments, title insurance and exchange services. The remaining immaterial segments have been combined into a group called “All Other.”

The title insurance segment primarily issues title insurance policies through approved attorneys from underwriting offices and through independent issuing agents. Title insurance policies insure titles to real estate.

The tax-deferred exchange services segment acts as an intermediary in tax-deferred exchanges of property held for productive use in a trade or business or for investments and serves as exchange accommodation titleholder, holding property for exchangers in reverse exchange transactions.

Provided below is selected financial information about the Company's operations by segment for the periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~:2023:


Three Months Ended March 31, 2024 (in thousands)	Title Insurance		Exchange Services		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	47,728	$	2,780	$	1,910	$	(4,012)	$	48,406
Net investment income	3,652		68		1,333		—		5,053
Total revenues	$	51,380	$	2,848	$	3,243	$	(4,012)	$	53,459
Operating expenses	48,560		670		2,272		(3,840)		47,662
Income before income taxes	$	2,820	$	2,178	$	971	$	(172)	$	5,797
Total assets	$	215,375	$	7,523	$	106,596	$	—	$	329,494


Three Months Ended March 31, 2023 (in thousands)	Title Insurance		Exchange Services		All Other		Intersegment Eliminations		Total
Insurance and other services revenues	$	46,166	$	3,854	$	1,889	$	(3,836)	$	48,073
Net investment income	2,527		34		709		—		3,270
Total revenues	$	48,693	$	3,888	$	2,598	$	(3,836)	$	51,343
Operating expenses	50,724		608		2,115		(3,665)		49,782
(Loss) income before income taxes	$	(2,031)	$	3,280	$	483	$	(171)	$	1,561
Total assets	$	231,894	$	5,903	$	86,000	$	—	$	323,797

Note 5 – Retirement Agreements and Other Postretirement Benefits

The Company’s subsidiary, Investors Title Insurance Company ("ITIC"), is a party to employment agreements with key executives that provide for the continuation of certain employee benefits and other payments due under the agreements upon retirement, estimated to total ~~$9,538,000~~ ~~and~~ ~~$8,487,000~~$15.2 million as of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016, respectively.~~2023. The executive employee benefits include health, ~~insurance,~~ dental, vision and life insurance and are unfunded. These amounts are classified as accounts payable and accrued liabilities in the unaudited Consolidated Balance Sheets. The following sets forth the net periodic ~~benefits~~benefit cost for the executive benefits for the periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~:2023:


	Three Months Ended March 31,
(in thousands)	2024		2023
Service cost – benefits earned during the year	$	—	$	—
Interest cost on the projected benefit obligation	11		10
Amortization of unrecognized gain	—		(7)
Net periodic benefit cost	$	11	$	3

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Service cost – benefits earned during the year $ —
$ 2,545
$ —
$ 7,635
Interest cost on the projected benefit obligation 9,217
8,781
27,651
26,343
Amortization of unrecognized losses 2,153
2,235
6,459
6,705
Net periodic benefits costs $ 11,370
$ 13,561
$ 34,110
$ 40,683

Note 6 – Investments and Estimated Fair Value

Investments in Fixed Maturity Securities

The ~~aggregate~~ estimated fair value, gross unrealized holding gains, gross unrealized holding losses and ~~cost or~~ amortized cost for fixed maturity securities by major ~~security type~~classification are as follows:


As of March 31, 2024 (in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:
Government obligations	$	738	$	—	$	—	$	738
General obligations of U.S. states, territories and political subdivisions	9,389		17		(55)		9,351
Special revenue issuer obligations of U.S. states, territories and political subdivisions	24,833		100		(67)		24,866
Corporate debt securities	27,317		430		(55)		27,692
Total	$	62,277	$	547	$	(177)	$	62,647


As of September 30, 2017	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturities, available-for-sale, at fair value:
As of December 31, 2023 (in thousands)									As of December 31, 2023 (in thousands)	Amortized Cost	Gross Unrealized Gains	Gross Unrealized Losses	Estimated Fair Value
Fixed maturity securities, available-for-sale, at fair value:									Fixed maturity securities, available-for-sale, at fair value:
Government obligations
General obligations of U.S. states, territories and political subdivisions	$	25,534,763	$	480,036	$	50,347	$	25,964,452
Special revenue issuer obligations of U.S. states, territories and political subdivisions	59,050,028		2,074,655		179,303		60,945,380
Corporate debt securities	13,255,865		567,850		3,101		13,820,614
Total	$	97,840,656	$	3,122,541	$	232,751	$	100,730,446
Equity securities, available-for-sale, at fair value:
Common stocks	$	25,927,969	$	19,221,955	$	33,463	$	45,116,461
Total	$	25,927,969	$	19,221,955	$	33,463	$	45,116,461
Short-term investments:
Commercial paper, money market funds and certificates of deposit	$	20,692,763	$	—	$	—	$	20,692,763
Total	$	20,692,763	$	—	$	—	$	20,692,763

As of December 31, 2016
Amortized
Cost

Gross
Unrealized
Gains

Gross
Unrealized
Losses

Estimated
Fair
Value
Fixed maturities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions $ 29,374,774
$ 440,628
$ 298,533
$ 29,516,869
Special revenue issuer obligations of U.S. states, territories and political subdivisions 57,459,818
1,619,444
502,135
58,577,127
Corporate debt securities 13,327,765
512,316
—
13,840,081
Total $ 100,162,357
$ 2,572,388
$ 800,668
$ 101,934,077
Equity securities, available-for-sale, at fair value:

Common stocks $ 24,836,032
$ 16,392,210
$ 48,983
$ 41,179,259
Total $ 24,836,032
$ 16,392,210
$ 48,983
$ 41,179,259
Short-term investments:

Money market funds and certificates of deposit $ 6,558,840
$ —
$ —
$ 6,558,840
Total $ 6,558,840
$ —
$ —
$ 6,558,840

The special revenue category for both periods presented includes approximately 6030 individual ~~bonds~~fixed maturity securities with revenue sources from a variety of industry sectors.

The scheduled maturities of fixed maturity securities at ~~September 30, 2017~~ ~~were~~March 31, 2024 are as follows:

Available-for-Sale

Amortized
Cost

Estimated Fair
Value
Due in one year or less $ 17,774,970
$ 17,870,218
Due one year through five years 27,079,300
27,792,150
Due five years through ten years 50,998,490
52,546,163
Due after ten years 1,987,896
2,521,915
Total $ 97,840,656
$ 100,730,446

Expected maturities will differ from contractual maturities as borrowers may have the right to call or prepay obligations with or without penalties.

~~Gross realized gains and losses on sales of investments for the nine-month periods ended~~ ~~September 30~~ ~~are summarized as follows:~~

2017 2016
Gross realized gains from securities:

Special revenue issuer obligations of U.S. states, territories and political subdivisions $ 139
$ 161
Corporate debt securities —
20
Common stocks and nonredeemable preferred stocks 1,232,330
880,647
Auction rate securities —
74,996
Total $ 1,232,469
$ 955,824
Gross realized losses from securities:

General obligations of U.S. states, territories and political subdivisions $ —
$ (533 )
Special revenue issuer obligations of U.S. states, territories and political subdivisions (100 ) (1,085 )
Common stocks and nonredeemable preferred stocks (255,481 ) (168,688 )
Other-than-temporary impairment of securities —
(233,941 )
Total $ (255,581 ) $ (404,247 )
Net realized gain from securities $ 976,888
$ 551,577
Net realized gain on other investments:
Gains on other investments $ 13,230
$ 22,751
Total $ 13,230
$ 22,751
Net realized gain on investments $ 990,118
$ 574,328

Less than 12 Months 12 Months or Longer Total
As of September 30, 2017
Estimated
Fair
Value

Unrealized
Losses

Estimated
Fair
Value

Unrealized
Losses

Estimated
Fair
Value

Unrealized
Losses
General obligations of U.S. states, territories and political subdivisions $ 8,356,815
$ (50,347 ) $ —
$ —
$ 8,356,815
$ (50,347 )
Special revenue issuer obligations of U.S. states, territories and political subdivisions 12,694,205
(115,937 ) 1,666,125
(63,366 ) 14,360,330
(179,303 )
Corporate 2,018,260
(3,101 ) —
—
2,018,260
(3,101 )
Total fixed income securities $ 23,069,280
$ (169,385 ) $ 1,666,125
$ (63,366 ) $ 24,735,405
$ (232,751 )
Equity securities $ 1,229,320
$ (33,463 ) $ —
$ —
$ 1,229,320
$ (33,463 )
Total temporarily impaired securities $ 24,298,600
$ (202,848 ) $ 1,666,125
$ (63,366 ) $ 25,964,725
$ (266,214 )


	Less than 12 Months				12 Months or Longer				Total
As of December 31, 2023 (in thousands)	Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses		Estimated Fair Value		Unrealized Losses
Government obligations	$	1,488	$	(2)	$	—	$	—	$	1,488	$	(2)
General obligations of U.S. states, territories and political subdivisions	5,925		(23)		101		(1)		6,026		(24)
Special revenue issuer obligations of U.S. states, territories and political subdivisions	7,124		(16)		3,085		(50)		10,209		(66)
Corporate debt securities	6,052		(29)		296		(4)		6,348		(33)
Total	$	20,589	$	(70)	$	3,482	$	(55)	$	24,071	$	(125)

Less than 12 Months 12 Months or Longer Total
As of December 31, 2016
Estimated
Fair
Value

Unrealized
Losses

Estimated
Fair
Value

Unrealized
Losses

Estimated
Fair
Value

Unrealized
Losses
General obligations of U.S. states, territories and political subdivisions $ 13,884,808
$ (298,533 ) $ —
$ —
$ 13,884,808
$ (298,533 )
Special revenue issuer obligations of U.S. states, territories and political subdivisions 16,161,906
(502,135 ) —
—
16,161,906
(502,135 )
Total fixed income securities $ 30,046,714
$ (800,668 ) $ —
$ —
$ 30,046,714
$ (800,668 )
Equity securities $ 380,400
$ (48,983 ) $ —
$ —
$ 380,400
$ (48,983 )
Total temporarily impaired securities $ 30,427,114
$ (849,651 ) $ —
$ —
$ 30,427,114
$ (849,651 )

The unrealized losses related to holdings of equity securities were caused by market changes that the Company considers to be temporary. Since the Company has the intent and ability to hold these equity securities until a recovery of fair value, the Company does not consider these investments other-than-temporarily impaired.

Reviews of the values of fixed maturity securities are inherently uncertain and the value of the investment may not fully recover, or may decline in future periods, resulting in a realized loss. The Company recorded ~~no other-than-temporary~~$53 thousand and $82 thousand in impairment charges ~~for debt and equity investments~~related to fixed maturity securities for the ~~nine-month period~~three-month periods ended ~~September 30, 2017~~March 31, 2024, and ~~$233,941 for the nine-month period ended September 30, 2016. Other-than-temporary impairment charges~~2023, respectively. Expenses related to impairments are ~~included~~recorded in net ~~realized gain on investments~~investment gains in the unaudited Consolidated Statements of ~~Income.~~Operations when recognized.

Investments in Equity Securities

The cost and estimated fair value of equity securities are as follows:


As of December 31, 2023 (in thousands)	Cost		Estimated Fair Value
Equity securities, at fair value:
Common stocks	$	22,981	$	37,212
Total	$	22,981	$	37,212

Unrealized holding gains and losses are reported in the unaudited Consolidated Statements of Operations as net investment gains.

Net Investment Gains

Gross investment gains and losses for the three-month periods ended March 31, 2024 and 2023 are summarized as follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Gross realized gains from securities:
Common stocks	$	2,807	$	7,483
Total	$	2,807	$	7,483
Gross realized losses from securities:
Common stocks	$	(162)	$	(121)
Write-down of securities	(53)		(82)
Total	$	(215)	$	(203)
Net realized gains from securities	$	2,592	$	7,280
Gross realized losses on other investments:
Losses on other investments	$	—	$	(47)
Total	$	—	$	(47)
Net realized investment gains	$	2,592	$	7,233
Changes in the estimated fair value of equity security investments	$	(170)	$	(6,790)
Net investment gains	$	2,422	$	443

Realized gains and losses are determined on the specific identification method.

Variable Interest Entities

The Company holds investments in variable interest entities ("VIEs") that are not consolidated in the Company's financial statements as the Company is not the primary beneficiary. These entities are considered VIEs as the equity investors at risk, including the Company, do not have the power over the activities that most significantly impact the economic performance of the entities; this power resides with a third-party general partner or managing member that cannot be removed except for ~~cause.~~cause and no participation rights exist. The following table sets forth details about the Company's variable interest investments in VIEs, which are structured either as limited partnerships ("LPs") or limited liability companies ("LLCs"), as of ~~September 30, 2017:~~March 31, 2024:

Type of Investment Balance Sheet Classification Carrying Value Estimated Fair Value Maximum Potential Loss (a)
  Tax credit LPs Other investments $ 905,179
$ 905,179
$ 1,325,000
  Real estate LLCs or LPs Other investments 4,907,741
5,438,088
7,200,000
  Small business investment LPs Other investments 3,699,694
3,612,437
9,400,000
Total $ 9,512,614
$ 9,955,704
$ 17,925,000


(in thousands)	Balance Sheet Classification	Carrying Value		Estimated Fair Value		Maximum Potential Loss (a)
Real estate LLCs or LPs	Other investments	$	12,751	$	14,000	$	18,060
Small business investment LPs	Other investments	197		197		80
Total		$	12,948	$	14,197	$	18,140


(a)
~~(a)~~		Maximum potential loss is calculated as the total investment in the LLC or LP, including any capital commitments that may have not yet been called. The Company is not exposed to any loss beyond the total commitment of its investment.

Valuation of Financial Assets ~~and Liabilities~~

The ~~FASB~~Financial Accounting Standards Board ("FASB") has established a valuation hierarchy for disclosure of the inputs used to measure estimated fair value of financial assets and liabilities, such as securities. This hierarchy categorizes the inputs into three broad levels as follows. Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level 3 inputs are unobservable inputs based on the Company’s own assumptions intended to represent market participant assumptions used to measure assets and liabilities at fair value.

A financial instrument’s classification within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement – consequently, if there are multiple significant valuation inputs that are categorized in different levels of the hierarchy, the instrument’s hierarchy level is the lowest level (with Level 3 being the lowest level) within which any significant input falls.

~~Debt and Equity Securities~~

The Level 1 category includes equity securities and U.S. Treasury securities that are measured at estimated fair value using quoted active market prices.

The Level 2 category includes fixed maturity ~~investments~~securities such as corporate ~~bonds,~~debt securities, U.S. government obligations, and ~~agency bonds~~obligations of U.S. states, territories, and ~~municipal bonds.~~political subdivisions. Estimated fair value is principally based on market values obtained from a third-party pricing service. Factors that are used in determining estimated fair market value include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data. The Company receives one quote per security from a third-party pricing service, although as discussed below, the Company does consult other pricing resources when confirming that the prices it obtains reflect the fair values of the instruments in accordance with ~~ASC 820, Fair Value Measurements and Disclosures~~.GAAP. Generally, quotes obtained from the pricing service for instruments classified as Level 2 are not adjusted and are not binding. As of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016,~~2023, the Company did not adjust any Level 2 fair values.

A number of the Company’s investment grade corporate ~~bonds~~debt securities are frequently traded in active markets, and trading prices are consequently available for these securities. However, these securities are classified as Level 2 because the pricing service from which the Company has obtained estimated fair values for these instruments uses valuation models that use observable market inputs in addition to trading prices. Substantially all of the input assumptions used in the service’s model are observable in the marketplace or can be derived or supported by observable market data.

In the measurement of the estimated fair value of certain financial instruments, other valuation techniques were utilized if quoted market prices were not available. These derived fair value estimates are significantly affected by the assumptions used. Additionally, certain financial instruments, including those related to insurance contracts, pension and other postretirement benefits, and equity method investments are excluded from the scope of disclosures.

In estimating the fair value of the financial instruments presented, the Company used the following methods and assumptions:

Cash and cash equivalents

The carrying amount for cash and cash equivalents is a reasonable estimate of fair value due to the short-term maturity of these investments.

Measurement alternative equity investments

The measurement alternative method requires investments without readily determinable fair values to be recorded at cost, less impairments, and plus or minus any changes resulting from observable price changes. The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Notes receivable are recorded at amortized cost and are included in prepaid expenses and other receivables in the unaudited Consolidated Balance Sheets. The amortized cost is the amount at which a receivable is originated and adjusted for applicable accrued interest, accretion, or amortization of premium, discount, and net deferred fees or costs, collection of cash, writeoffs, foreign exchange, and fair value hedge accounting adjustments. The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Accrued interest and dividends

The carrying amount for accrued interest and dividends is a reasonable estimate of fair value due to the short-term maturity of these assets.

The following table presents, by level, fixed maturity securities carried at estimated fair value as of March 31, 2024 and December 31, 2023:


As of December 31, 2023 (in thousands)	Level 1		Level 2 *		Level 3		Total
Fixed maturity securities:
Obligations of U.S. states, territories and political subdivisions	$	2,220	$	34,446	$	—	$	36,666
Corporate debt securities	—		27,181		—		27,181
Total	$	2,220	$	61,627	$	—	$	63,847

*Denotes fair market value obtained from pricing services.

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of March 31, 2024 and December 31, 2023:


As of December 31, 2023 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Cash and cash equivalents	$	24,031	$	—	$	—	$	24,031
Accrued interest and dividends	978		—		—		978
Equity securities, at fair value:
Common stocks	37,212		—		—		37,212
Short-term investments:
Money market funds and U.S. Treasury bills	110,224		—		—		110,224
Total	$	172,445	$	—	$	—	$	172,445

The Company did not hold any Level 3 category debt or marketable equity investment securities as of ~~September 30, 2017~~March 31, 2024 or December 31, ~~2016.~~2023.

As of September 30, 2017 Level 1 Level 2 Level 3 Total
Short-term investments $ 20,692,763
$ —
$ —
$ 20,692,763
Equity securities:

Common stock 45,116,461
—
—
45,116,461
Fixed maturities:

Obligations of U.S. states, territories and political subdivisions* —
86,909,832
—
86,909,832
Corporate debt securities* —
13,820,614
—
13,820,614
Total $ 65,809,224
$ 100,730,446
$ —
$ 166,539,670

As of December 31, 2016 Level 1 Level 2 Level 3 Total
Short-term investments $ 6,558,840
$ —
$ —
$ 6,558,840
Equity securities:
Common stock 41,179,259
—
—
41,179,259
Fixed maturities:
Obligations of U.S. states, territories and political subdivisions* —
88,093,996
—
88,093,996
Corporate debt securities* —
13,840,081
—
13,840,081
Total $ 47,738,099

$ 101,934,077
$ —
$ 149,672,176

*Denotes fair market value obtained from pricing services.

There were no transfers into or out of Levels 1, 2 or 3 during the ~~period.~~periods presented.

To help ensure that estimated fair value determinations are consistent with ~~ASC 820,~~GAAP, prices from our pricing services go through multiple review processes to ensure appropriate pricing. Pricing procedures and inputs used to price each security include, but are not limited to, the following: unadjusted quoted market prices for identical securities such as stock market closing prices; non-binding quoted prices for identical securities in markets that are not active; interest rates; yield curves observable at commonly quoted intervals; volatility; prepayment speeds; loss severity; credit ~~risks~~risks; and default rates. The Company reviews the procedures and inputs used by its pricing services, and verifies a sample of the services’ quotes by comparing them to values obtained from other pricing resources. In the event the Company disagrees with a price provided by its pricing services, the respective service reevaluates the price to corroborate the market information and then reviews inputs to the evaluation in light of potentially new market data. ~~The Company believes that these processes and inputs result in appropriate classifications and estimated fair values consistent with ASC 820.~~

~~Other Financial Instruments~~

~~Cash and cash equivalents~~

~~Cost-basis investments~~

~~Accrued dividends and interest~~

As of September 30, 2017 Carrying Value
Estimated Fair
Value
Level 1 Level 2 Level 3
Financial assets:
Cash $ 30,890,785
$ 30,890,785
$ 30,890,785
$ —
$ —
Cost-basis investments 5,342,495
5,698,667
—
—
5,698,667
Accrued interest and dividends 1,323,598
1,323,598
1,323,598
—
—
Total $ 37,556,878
$ 37,913,050
$ 32,214,383
$ —
$ 5,698,667

As of December 31, 2016 Carrying Value
Estimated Fair
Value
Level 1 Level 2 Level 3
Financial assets:
Cash $ 27,928,472
$ 27,928,472
$ 27,928,472
$ —
$ —
Cost-basis investments 4,244,402
4,497,665
—
—
4,497,665
Accrued interest and dividends 1,035,152
1,035,152
1,035,152
—
—
Total $ 33,208,026
$ 33,461,289
$ 28,963,624
$ —
$ 4,497,665

Certain ~~cost-basis~~measurement alternative equity investments and notes receivable are measured at estimated fair value on a non-recurring basis and are reviewed for impairment quarterly. If any such ~~as investments that are~~investment is determined to be ~~other-than-temporarily~~ impaired, ~~during the period~~an impairment charge is recorded against such investment and ~~recorded at estimated fair value~~reflected in the unaudited Consolidated ~~Financial~~ Statements as of ~~September 30, 2017 and December 31, 2016.~~Operations. There were no impairments of such investments made during the ~~nine-month~~three-month period ended ~~September 30, 2017~~March 31, 2024 or the twelve-month period ended December 31, ~~2016.~~2023. The following table presents assets measured at fair value on a non-recurring basis as of March 31, 2024 and December 31, 2023:


As of March 31, 2024 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Equity investments in unconsolidated affiliates, measurement alternative	$	—	$	—	$	9,316	$	9,316
Notes receivable	—		—		641		641
Total	$	—	$	—	$	9,957	$	9,957


As of December 31, 2023 (in thousands)	Level 1		Level 2		Level 3		Total
Financial assets:
Equity investments in unconsolidated affiliates, measurement alternative	$	—	$	—	$	9,300	$	9,300
Notes receivable	—		—		2,201		2,201
Total	$	—	$	—	$	11,501	$	11,501

Note 7 – Commitments and Contingencies

Legal ~~Proceedings~~ –Proceedings: The Company and its subsidiaries are involved in legal proceedings that are incidental to their business. In the Company’s opinion, based on the present status of these proceedings, any potential liability of the Company or its subsidiaries with respect to these legal proceedings ~~will~~is not expected to, in the aggregate, be material to the Company’s consolidated financial condition or operations.

~~Regulation~~ –Regulation: The Company’s title insurance and trust subsidiaries are regulated by various federal, state and local governmental agencies and are subject to various audits and inquiries. It is the opinion of management based on its present expectations that these audits and inquiries will not have a material impact on the Company’s consolidated financial condition or operations.

Escrow and Trust ~~Deposits~~ – Deposits: As a service to its customers, the Company, through ITIC, administers escrow and trust deposits representing earnest money received under real estate contracts, escrowed funds received under escrow agreements, undisbursed amounts received for settlement of mortgage loans and indemnities against specific title risks. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance ~~Sheets. However,~~Sheets; however, the Company remains contingently liable for the disposition of these deposits.

Like-Kind ~~Exchanges Proceeds~~ – Exchange Proceeds: In administering tax-deferred ~~property~~like-kind exchanges pursuant to § 1031 of the Internal Revenue Code, the Company’s wholly owned subsidiary, Investors Title Exchange Corporation (“ITEC”), serves as a qualified intermediary, ~~for exchanges,~~ holding the net sales proceeds from relinquished property to be used for purchase of replacement property. Another wholly owned subsidiary of the Company, ~~subsidiary,~~ Investors Title Accommodation Corporation (“ITAC”), serves as exchange accommodation titleholder and, through ~~limited liability companies~~LLCs that are wholly owned subsidiaries of ITAC, holds property ~~for exchangers~~ in reverse exchange transactions. Like-kind exchange deposits and reverse exchange property totaled approximately ~~$213,917,000~~$220.6 million and ~~$202,184,000~~$263.7 million as of ~~September 30, 2017~~March 31, 2024 and December 31, ~~2016,~~2023, respectively. These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets; however, the Company remains contingently liable for the disposition of the transfers of property, disbursements of proceeds and the return on the proceeds at the agreed upon rate. Exchange services ~~revenues include~~revenue includes earnings on these deposits; therefore, investment income is shown as ~~other revenue~~non-title services rather than investment income. These like-kind exchange funds are primarily invested in money market funds and other short-term investments.

Note 8 – Related Party Transactions

The Company does business with, and has investments in, unconsolidated ~~limited liability companies~~LLCs that are primarily title insurance agencies. The Company utilizes the equity method to account for its investment in these ~~limited liability companies.~~LLCs. The following table sets forth the approximate values by year found within each financial statement classification:

Financial Statement Classification, As of September 30, 2017 As of December 31, 2016
Consolidated Balance Sheets
Other investments $ 6,172,000
$ 6,437,000
Premiums and fees receivable $ 809,000
$ 56,000


Financial Statement Classification, Consolidated Statements of Operations (unaudited) (in thousands)	Three Months Ended March 31,
	Three Months Ended March 31,
	2024		2023
Net premiums written	$	5,207	$	4,133
Non-title services and other investment income	$	196	$	750
Commissions to agents	$	3,687	$	2,753

Financial Statement Classification, For the Three Months Ended
September 30, For the Nine Months Ended
September 30,
Consolidated Statements of Income 2017 2016 2017 2016
Net premiums written $ 3,705,000
$ 4,513,000
$ 11,036,000
$ 10,993,000
Other income $ 642,000
$ 809,000
$ 1,689,000
$ 1,541,000
Commissions to agents $ 2,501,000
$ 3,062,000
$ 7,457,000
$ 7,465,000

Note 9 – ~~Business Combinations,~~ Intangible Assets, Goodwill and ~~Goodwill~~Title Plants

~~Recent Business Combinations~~

In October 2016, National Investors Holdings, LLC ("NIH"), a subsidiary of the Company, acquired all of the outstanding shares of a title insurance agency doing business in Texas. NIH paid $10 million plus a $918,000 adjustment for the title insurance agency’s net cash position at closing.

The estimated fair values of intangible assets recognized as the result of title insurance agency acquisitions ~~all Level 3 inputs,~~ are principally based on values obtained from aan independent third-party valuation ~~service. In accordance with ASC 350,~~ ~~Intangibles – Goodwill~~service and ~~Other, management~~are all Level 3 inputs. Management determined that no events or changes in circumstances occurred during the three-month periods ended March 31, 2024 and 2023 that would indicate the carrying amounts may not be recoverable, and therefore, determined that no identifiable intangible assets were ~~impaired at September 30, 2017.~~impaired.

Identifiable intangible assets consist of the ~~following as of September 30, 2017 and December 31, 2016:~~following:


(in thousands)	As of March 31, 2024		As of December 31, 2023
Referral relationships	$	8,898	$	8,898
Non-compete agreements	3,155		3,155
Tradename	747		747
Total	12,800		12,800
Accumulated amortization	(6,514)		(6,176)
Identifiable intangible assets, net	$	6,286	$	6,624

2017 2016
Referral relationships $ 6,498,215
$ 6,416,215
Non-compete agreements 1,405,685
1,405,685
Tradename 560,000
560,000
Searcher network 126,000
—
Total 8,589,900
8,381,900
Accumulated amortization (1,182,806 ) (475,110 )
Identifiable intangible assets, net $ 7,407,094
$ 7,906,790

The following table provides the estimated aggregate amortization expense, as of March 31, 2024, for each of the five succeeding fiscal years:


Year Ended (in thousands)
2024	$	840
2025	1,095
2026	1,095
2027	679
2028	650
Thereafter	1,740
Total	$	6,099

Year Ended:
2017 $ 208,989
2018 683,857
2019 610,524
2020 610,524
2021 603,191
Thereafter 4,690,009
Total $ 7,407,094

Goodwill and Title ~~Plant~~Plants

~~The~~As of March 31, 2024, the Company ~~has~~ recognized ~~$4,378,851~~$9.6 million in goodwill and ~~$690,000~~$1.6 million in a title ~~plant~~plants, net of impairments, as the result of title insurance agency acquisitions. The title ~~plant is~~plants are included with ~~prepaid expenses and~~ other assets in the unaudited Consolidated Balance Sheets. The fair values of goodwill and the title ~~plant,~~plants as of the date of acquisition, both Level 3 inputs, ~~are~~were principally based on values obtained from aan independent third-party valuation service. In accordance with ~~ASC~~FASB's Accounting Standards Codification ("ASC") 350, ~~Intangibles – Goodwill and Other, management~~the Company determined that no events or changes in circumstances occurred during the three-month periods ended March 31, 2024 and 2023 that would indicate the carrying amounts may not be recoverable, and therefore, determined that there were no goodwill ~~and the~~or title plant ~~were not impaired at September 30, 2017.~~impairments.

Note 10 – Accumulated Other Comprehensive Income

The following ~~tables provide~~table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~:2023:


Three Months Ended March 31, 2024 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	583	$	55	$	638
Other comprehensive (loss) income before calculations	(333)		—		(333)
Amounts reclassified from accumulated other comprehensive income	41		—		41
Net current-period other comprehensive (loss) income	(292)		—		(292)
Ending balance	$	291	$	55	$	346


Three Months Ended March 31, 2023 (in thousands)	Unrealized Gains and Losses On Available-for-Sale Securities		Postretirement Benefits Plans		Total
Beginning balance at January 1	$	164	$	36	$	200
Other comprehensive income before calculations	186		111		297
Amounts reclassified from accumulated other comprehensive income	63		—		63
Net current-period other comprehensive income	249		111		360
Ending balance	$	413	$	147	$	560

Three Months Ended September 30, 2017
Unrealized Gains and Losses
On Available-for-Sale
Securities

Postretirement
Benefits Plans

Total
Beginning balance at July 1 $ 13,774,631
$ (106,356 ) $ 13,668,275
Other comprehensive income before reclassifications 1,235,517
—
1,235,517
Amounts reclassified from accumulated other comprehensive income (529,519 ) 1,421
(528,098 )
Net current-period other comprehensive income 705,998
1,421
707,419
Ending balance $ 14,480,629
$ (104,935 ) $ 14,375,694

Three Months Ended September 30, 2016
Unrealized Gains and Losses
On Available-for-Sale
Securities

Postretirement
Benefits Plans

Total
Beginning balance at July 1 $ 14,331,320
$ (111,776 ) $ 14,219,544
Other comprehensive loss before reclassifications (489,001 ) —
(489,001 )
Amounts reclassified from accumulated other comprehensive income (282,461 ) 1,476
(280,985 )
Net current-period other comprehensive (loss) income (771,462 ) 1,476
(769,986 )
Ending balance $ 13,559,858
$ (110,300 ) $ 13,449,558

Nine Months Ended September 30, 2017
Unrealized Gains and Losses
On Available-for-Sale
Securities

Postretirement
Benefits Plans

Total
Beginning balance at January 1 $ 11,870,647
$ (109,200 ) $ 11,761,447
Other comprehensive income before reclassifications 3,252,816
—
3,252,816
Amounts reclassified from accumulated other comprehensive income (642,834 ) 4,265
(638,569 )
Net current-period other comprehensive income 2,609,982
4,265
2,614,247
Ending balance $ 14,480,629
$ (104,935 ) $ 14,375,694

Nine Months Ended September 30, 2016
Unrealized Gains and Losses
On Available-for-Sale
Securities

Postretirement
Benefits Plans

Total
Beginning balance at January 1 $ 11,597,741
$ (114,726 ) $ 11,483,015
Other comprehensive income before reclassifications 2,325,045
—
2,325,045
Amounts reclassified from accumulated other comprehensive income (362,928 ) 4,426
(358,502 )
Net current-period other comprehensive income 1,962,117
4,426
1,966,543
Ending balance $ 13,559,858
$ (110,300 ) $ 13,449,558

The following ~~tables provide~~table provides significant amounts reclassified out of each component of accumulated other comprehensive income for the three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~:2023:

Three Months Ended September 30, 2017
Details about Accumulated Other
Comprehensive Income Components
Amount Reclassified from
Accumulated Other
Comprehensive Income

Affected Line Item in the Consolidated
Statements of Income
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments $ 803,938

Other-than-temporary impairments —

Total $ 803,938
Net realized gain on investments
Tax (274,419 ) Provision for Income Taxes
Net of Tax $ 529,519

Amortization related to postretirement benefit plans:

Prior year service cost $ —

Unrecognized loss (2,153 )
Total $ (2,153 ) (a)
Tax 732
Provision for Income Taxes
Net of Tax $ (1,421 )
Reclassifications for the period $ 528,098

Three Months Ended September 30, 2016
Details about Accumulated Other
Comprehensive Income Components Amount Reclassified from
Accumulated Other
Comprehensive Income Affected Line Item in the Consolidated
Statements of Income
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments $ 545,925

Other-than-temporary impairments (118,703 )
Total $ 427,222
Net realized gain on investments
Tax (144,761 ) Provision for Income Taxes
Net of Tax $ 282,461

Amortization related to postretirement benefit plans:

Prior year service cost $ —

Unrecognized loss (2,235 )
Total $ (2,235 ) (a)
Tax 759
Provision for Income Taxes
Net of Tax $ (1,476 )
Reclassifications for the period $ 280,985

Nine Months Ended September 30, 2017
Details about Accumulated Other
Comprehensive Income Components
Amount Reclassified from
Accumulated Other
Comprehensive Income

Affected Line Item in the Consolidated
Statements of Income
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments $ 976,888

Other-than-temporary impairments —

Total $ 976,888
Net realized gain on investments
Tax (334,054 ) Provision for Income Taxes
Net of Tax $ 642,834

Amortization related to postretirement benefit plans:

Prior year service cost $ —

Unrecognized loss (6,459 )
Total $ (6,459 ) (a)
Tax 2,194
Provision for Income Taxes
Net of Tax $ (4,265 )
Reclassifications for the period $ 638,569

Nine Months Ended September 30, 2016
Details about Accumulated Other
Comprehensive Income Components Amount Reclassified from
Accumulated Other
Comprehensive Income Affected Line Item in the Consolidated
Statements of Income
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments $ 785,517

Other-than-temporary impairments (233,941 )
Total $ 551,576
Net realized gain on investments
Tax (188,648 ) Provision for Income Taxes
Net of Tax $ 362,928

Amortization related to postretirement benefit plans:

Prior year service cost $ —

Unrecognized loss (6,705 )
Total $ (6,705 ) (a)
Tax 2,279
Provision for Income Taxes
Net of Tax $ (4,426 )
Reclassifications for the period $ 358,502


Three Months Ended March 31, 2024 (in thousands)
Details about Accumulated Other Comprehensive Income Components	Amount Reclassified from Accumulated Other Comprehensive Income		Affected Line Item in the Consolidated Statements of Operations
~~(a)~~Unrealized gains and losses on available-for-sale securities:	~~These accumulated other comprehensive~~
Net realized gain on investments	$	—
Write-down of securities	(53)
Total	$	(53)	Net investment gains
Tax	12		Provision for income ~~components~~taxes
Net of Tax	$	(41)
Reclassifications for the period	$	(41)


Three Months Ended March 31, 2023 (in thousands)
Details about Accumulated Other Comprehensive Income Components	Amount Reclassified from Accumulated Other Comprehensive Income		Affected Line Item in the Consolidated Statements of Operations
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments	$	—
Write-down of securities	(82)
Total	$	(82)	Net investment gains
Tax	19		Provision for income taxes
Net of Tax	$	(63)
Reclassifications for the period	$	(63)

Note 11 – Revenue from Contracts with Customers

ASC 606, Revenue from Contracts with Customers, requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. This guidance does not apply to revenue associated with insurance contracts (including title insurance policies), financial instruments and lease contracts; and therefore is primarily applicable to the following Company revenue categories.

Escrow and other title-related fees: The Company’s title segment recognizes commission revenue and fees related to items such as searches, settlements, commitments and other ancillary services. Escrow and other title-related fees are recognized as revenue at the time of the related transactions as the earnings process, or performance obligation, is then considered to be complete.

Non-title services: Through various subsidiaries, the Company offers management services, tax-deferred real property exchange services, investment management and trust services. Nonrefundable exchange fees are recognized as revenue upon receipt of the funds, which is at the time of closing of the initial sale of property. All other non-title service fees are recognized as revenue as performance obligations are completed.

Other: The Company occasionally recognizes revenue from other miscellaneous contracts which can include, but is not limited to seminar and education registration fees and software licensing contracts. These revenue streams are deemed immaterial to the operations of the Company, and revenue is recognized when, or as, performance obligations are completed.

The following table provides a breakdown of the Company’s revenue by major business activity:

The Company enters into lease agreements that are primarily for office space. These leases are accounted for as operating leases, with lease expense recognized on a straight-line basis over the term of the lease. The Company occasionally assumes equipment lease agreements through business acquisitions. These leases are accounted for as finance leases.

Included in a portion of the Company's current leases is an option to extend or cancel the lease term. The exercise of such an option is solely at the Company's discretion. The lease liability recorded in the unaudited Consolidated Balance Sheets includes lease payments related to options to extend or cancel the lease term if the Company determines at the inception date that the lease is expected to be renewed or extended. The Company, in determining the present value of lease payments, utilizes the average rate over a 10-year term based upon the Moody's seasoned Aaa corporate bond yields, as explicit rates of interest are not readily determinable in the lease contracts. The Company does not carry debt; thus no incremental borrowing rate was available to the Company.

Lease expense is included in office and technology expenses in the unaudited Consolidated Statements of Operations. Information regarding the Company’s leases follows:


	Three Months Ended March 31,
(in thousands)	2024		2023
Operating leases	$	658	$	731
Finance leases:
Amortization of lease assets	71		54
Lease expense	$	729	$	785
Sub-lease income	(52)		—
Lease cost	$	677	$	785


(b)						Leases with an initial term of twelve months or less are not ~~reclassified to net income in their entirety in the same reporting period. The amounts are presented within salaries, employee benefits and payroll taxes~~recorded on the unaudited Consolidated ~~Statements of Income as amortized. Amortization and accretion related to postretirement benefit plans is included in the computation of net periodic pension costs, as discussed in Note 5.~~Balance Sheets.

Components of the lease liability presented on the unaudited Consolidated Balance Sheets are as follows:


(in thousands)	As of March 31, 2024		As of December 31, 2023
Current:
Operating lease liabilities	$	1,755	$	2,201
Finance lease liabilities	177		170
Non-current:
Operating lease liabilities	4,299		3,792
Finance lease liabilities	597		286
Total lease liabilities	$	6,828	$	6,449

The future minimum lease payments for leases that have initial or remaining noncancelable lease terms in excess of one year as of March 31, 2024, are summarized as follows:


Year Ended (in thousands)	Operating Leases		Finance Leases		Total
2024	$	1,904	$	199	$	2,103
2025	2,179		241		2,420
2026	1,332		203		1,535
2027	424		136		560
2028	183		56		239
Thereafter	433		—		433
Total undiscounted payments	$	6,455	$	835	$	7,290
Less: present value adjustment	(401)		(61)		(462)
Lease liabilities	$	6,054	$	774	$	6,828

Supplemental lease information is as follows:


	As of March 31, 2024		As of December 31, 2023
Weighted average remaining lease term (years)
Operating Leases	3.34		3.07
Finance Leases	3.49		2.93
Weighted average discount rate
Operating Leases	3.9	%	3.8	%
Finance Leases	4.3	%	3.7	%

The Company does not have any material pending operating or financing lease agreements that become effective in future periods.

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

~~The~~Investors Title Company's (the "Company") Annual Report on Form 10-K for the year ended December 31, ~~2016~~2023 (the "2023 Form 10-K") as filed with the Securities and Exchange Commission (the "SEC") should be read in conjunction with the following discussion since it contains information which is important for evaluating the Company's operating results and financial condition. ~~Forward-looking~~

In addition, the Company may make forward-looking statements in the following discussion and analysis. Forward looking statements are based on certain assumptions and expectations of future events that are subject to a number of risks and uncertainties. Actual results may vary. See "Safe Harbor for Forward-Looking Statements" at the end of this discussion and analysis, as well as the sections titled "Risk Factors" in Part I, Item 1A of the 2023 Form 10-K for factors that could affect forward-looking statements.

Overview

~~Investors~~ Title Insurance

The Company ~~(the “Company”)~~ is a holding company that engages primarily in issuing title insurance through two subsidiaries, Investors Title Insurance Company (“ITIC”) and National Investors Title Insurance Company (“NITIC”). ~~Total revenues from the title segment accounted for 95.7% of the Company's revenues for the nine-month period ended September 30, 2017.~~ Through ITIC and NITIC, the Company underwrites land title insurance for owners and mortgagees as a primary insurer. Total revenues from the title segment accounted for 89.2% of the Company's revenues for the three-month period ended March 31, 2024.

Title insurance protects against loss or damage resulting from title defects that affect real ~~property.~~

~~Title insurance policies for mortgage lenders~~property and ~~real estate owners are~~customarily arising prior to the ~~two basic types of policies. A lender often requires the property owner to purchase a lender’s title insurance~~ policy to protect its position as a holder of a mortgage loan, but the lender’s title insurance policy does not protect the property owner. The property owner has to purchase a separate owner’s title insurance policy to protect its investment.date. When real property is conveyed from one party to another, occasionally there is an undisclosed defect in the title or a mistake or omission in a prior deed, will or mortgage that may give a third party a legal claim against such property. If a covered claim is made against real property, title insurance provides indemnification against insured defects.

There are two basic types of title insurance policies – one for the mortgage lender and one for the real property owner. A lender often requires the property owner to purchase a lender’s title insurance policy to protect its position as a holder of a mortgage loan, but the lender’s title insurance policy does not protect the property owner. The property owner has to purchase a separate owner’s title insurance policy to protect its investment.

The Company issues title insurance policies ~~through its home and branch offices~~directly and through a network of agents. Issuing agents are typically real estate attorneys, independent agents or subsidiaries of community and regional mortgage lending institutions, depending on local customs and regulations and the Company’s marketing strategy in a particular territory. The ability to attract and retain issuing agents is a key determinant of the Company’s growth in title insurance premiums written.

Revenues for ~~this~~the title insurance segment primarily result from purchases of new and existing residential and commercial real estate, refinance activity and certain other types of mortgage lending such as home equity lines of credit.

Title insurance premiums vary from state to state and are subject to extensive regulation. Statutes generally provide that rates must not be excessive, inadequate or unfairly discriminatory. The process of implementing a rate change in most states involves pre-approval by the applicable state insurance regulator.

Volume is a factor in the Company’s profitability due to fixed operating costs ~~which~~that are incurred by the Company regardless of title insurance premium volume. The resulting operating leverage tends to amplify the impact of changes in volume on the Company’s profitability. The Company’s profitability also depends, in part, upon its ability to manage its investment portfolio to maximize investment returns and to minimize risks such as interest rate changes, defaults and impairments of assets.

The Company’s volume of title insurance premiums is affected by the overall level of residential and commercial real estate activity, which includes property sales, mortgage financing and mortgage refinancing. Real estate activity, home sales and mortgage lending are cyclical in nature. ~~In turn, real~~Real estate activity is affected by a number of factors, including the availability of mortgage credit, the cost of real estate, consumer confidence, employment and family income levels, and general United States economic conditions. Interest rate volatility is also an important factor in the level of residential and commercial real estate activity.

The Company’s title insurance premiums in future periods are likely to fluctuate due to these and other factors which are beyond management’s control.

Historically, the title insurance business tends to be seasonal as well as cyclical. Because home sales are typically strongest in periods of favorable weather, the first calendar quarter tends to have the lowest activity levels, while the spring and summer quarters tend to be more active. ~~Refinance~~Mortgage refinance activity ~~is generally~~tends to be influenced less ~~seasonal, but is subject to~~by seasonality and more by economic cycles, with activity levels increasing during times of falling interest ~~rate fluctuations.~~rates.

Services other than title insurance provided by operating divisions of the Company are not reported separately and are reported collectively in a category called “All Other.” These other services include those offered by the Company and by its wholly owned subsidiaries, Investors Title

Exchange ~~Corporation (“ITEC”), Investors Title Accommodation Corporation (“ITAC”), Investors Trust Company (“Investors Trust”) and Investors Title Management~~ Services ~~Inc. (“ITMS”).~~

The Company’s exchange services division, consisting of the operations of ~~ITEC~~Investors Title Exchange Corporation (“ITEC”) and ~~ITAC,~~Investors Title Accommodation Corporation (“ITAC”), provides customer services in connection with tax-deferred real property exchanges. ITEC ~~serves~~acts as a qualified intermediary in ~~like-kind~~tax-deferred exchanges of real property held for productive use in a trade or ~~personal property under Section 1031~~business or for investment, and its income is derived from fees for handling exchange transactions and a portion of the ~~Internal Revenue Code of 1986, as amended.~~interest earned on client deposits held by the Company. In its role as qualified intermediary, ITEC coordinates the exchange aspects of the real estate transaction, and its duties include drafting standard exchange documents, holding the exchange funds between the ~~sale of~~time the old property is sold and ~~the purchase of~~ the new property is purchased, and accepting the formal identification of the replacement property within the required identification period. ITAC ~~serves~~provides services as an exchange accommodation titleholder for accomplishing “parking transactions” as set forth in the safe harbor contained in Internal Revenue Procedure 2000-37. These transactions include reverse ~~exchanges. An exchange accommodation offers a vehicle for accommodating a reverse exchange~~exchanges when ~~the taxpayer must~~taxpayers decide to acquire replacement property before selling the relinquished property, or “build to suit” exchanges, when improvements must be made to the replacement property before the taxpayer acquires the improved replacement property. The services provided by the Company’s exchange services division, ITEC and ITAC, are pursuant to provisions in the Internal Revenue Code. From time to time, these laws are subject to review and changes, which may negatively affect the demand for tax-deferred exchanges in general, and consequently, the revenues and profitability of the Company’s exchange services division.

Management Services, Investment Management and Trust Services

Other services provided by operating divisions of the Company are not reported separately, but rather are reported collectively in a category called “All Other.” These other services include those offered by the Company and by its wholly owned subsidiaries, Investors Title Management Services, Inc. (“ITMS”) and Investors Trust Company (“Investors Trust”).

ITMS offers various consulting and management services to provide clients with the technical expertise to start and successfully operate a title insurance agency.

The Company’s trust services division, Investors Trust, provides investment management and trust services to individuals, companies, banks and trusts.

~~ITMS offers various consulting services to provide clients with the technical expertise to start and successfully operate a title insurance agency.~~

Business Trends and Recent Conditions

The housing market is heavily influenced by government policies and overall economic ~~conditions~~conditions. Regulatory reform and ~~government policies. Factors that could impact the Company include, but are not limited to:~~ initiatives by various governmental agencies, including the Federal Reserve's monetary ~~policy;~~policy and other regulatory changes, ~~and reform of government-sponsored entities that~~ could impact lending standards or the processes and procedures used by the ~~Company; and the~~Company. The current real estate environment, including interest rates and general economic activity, ~~that~~ typically influence the demand for real estate. ~~Any one or a combination~~Changes in either of these ~~factors would likely~~areas, in addition to any inventory constraints or volatility in the cost and availability of building materials, could impact the Company's results of ~~operations.~~operations in future periods.

~~Initiatives~~

~~In efforts~~A recent period of inflation, as well as ongoing geopolitical and military conflicts, have created additional volatile market conditions and uncertainties in the global economy. These events have impacted and could continue to ~~provide transparency,~~impact the Company in a number of ways including, but not limited to, future fluctuations in the Company's investment portfolio and potential decreases in net premiums written. The Federal Open Market Committee (“FOMC”) of the Federal Reserve has been highly attentive to the risks that these events have created, and in response raised the target federal funds rate at several meetings held during 2022 and 2023. Although the federal funds rate does not directly impact mortgage interest rates, it can have a significant influence as lenders pass on the costs of rate increases to consumers. Higher mortgage interest rates have impacted the demand and pricing of real estate.

Regulatory Environment

The FOMC issues disclosures on a periodic basis that include projections of the federal funds rate and expected actions. ~~At the December 2015 meeting, the FOMC voted to raise the federal funds rate for the first time since December 2008 to~~The FOMC maintained a target range between 0.00% and 0.25% ~~and 0.50%. The~~from March 2020 until March 2022. Starting at the March 2022 meeting of the FOMC, ~~voted to increase~~ the FOMC consistently raised the target federal funds rate ~~three additional times, at~~range through July 2023, when the ~~December 2016 meeting to a~~FOMC increased the target range to between ~~0.50%~~5.25% and ~~0.75%, at~~5.50%. No additional changes to the ~~March 2017 meeting to a~~ target ~~range between 0.75% and 1.00%, and again at~~federal funds rate have been made since the ~~June 2017 meeting to a target range between 1.00% and 1.25%. Any~~July 2023 meeting. In normal economic situations, future adjustments to the ~~rate~~FOMC’s stance of monetary policy are expected to be based on realized and expected economic developments to achieve maximum employment and 2.0% inflation. The FOMC anticipates future economic conditions to evolve in ways that will warrant gradual increases and that for some time, the federal funds rate is expected to be below long range levels. At the September 2017 meeting,inflation near the FOMC ~~voted to keep rates unchanged and announced that the reduction of securities held on the Federal Reserve's balance sheet, also known as normalization, will begin in October 2017.~~'s symmetric long-term 2.0% objective.

On October 20, 2014, the Federal Housing Finance Agency ("FHFA"), which regulates the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), announced that Fannie Mae and Freddie Mac were negotiating guidelines with mortgage lenders that once completed, resulted in less strict lending requirements and lower barriers to mortgage loans for borrowers who are seeking access to home loans. The FHFA noted in its announcement that it intended to clarify the rules that allow Fannie Mae and Freddie Mac to require mortgage lenders to repurchase troubled loans. The FHFA also sought to increase the supply of credit available, particularly to creditworthy lower and middle-income families, by collaborating with mortgage lenders to provide guidelines for mortgage loans with down payments as low as 3.0%. In December 2014, both Fannie Mae and Freddie Mac officially approved 97.0% loan-to-value products (3.0% down payment mortgages). The Fannie Mae program is targeted to first-time home buyers and became available to lenders in December 2014. The Freddie Mac program became available to lenders on March 23, 2015 and is available to both first-time home buyers and other qualified borrowers with limited down payment savings.

In an effort to expand home ownership for lower-income buyers, the Federal Housing Authority (“FHA”) announced in January 2015 that it would cut its rates on mortgage insurance premiums. Mortgage insurance premium rates for 30-year FHA insured mortgages with less than a 5.0% down payment decreased from 1.35% to 0.85%. Mortgage insurance premium rates for 30-year FHA insured mortgages with more than a 5.0% down payment decreased from 1.30% to 0.80%. The new rates took effect on January 26, 2015 and do not apply to borrowers with existing mortgages, unless refinanced, or to 15-year mortgages.

~~Regulation and Reform~~

In 2008, the federal government took control of Fannie Mae and Freddie Mac in an effort to keep these government-sponsored entities from failing. The primary functions of Fannie Mae and Freddie Mac are to provide liquidity to the nation's mortgage finance system by purchasing mortgages on the secondary market, pooling them and selling them as mortgage-backed securities. In order to securitize, Fannie Mae and Freddie Mac typically require the purchase of title insurance for loans they acquire. Since the federal takeover, there have been various discussions and proposals regarding their reform. Changes to these entities could impact the entire mortgage loan process and, as a result, could affect the demand for title insurance. The timing and results of reform are currently unknown; however, any changes to these entities could affect the Company and its results of operations.

On July 7, 2017, the Consumer Financial Protection Bureau (“CFPB”) released final amendments to federal mortgage disclosure requirements under the Real Estate Settlement Procedures Act and the Truth in Lending Act that are implemented in Regulation Z. The final rules were published in the Federal Register on August 11, 2017. The amendments reinforce the CFPB’s informal guidance on various issues and include clarifications and technical amendments. The CFPB rule creates tolerances for the total of payments; adjusts a partial exemption that mainly affects housing finance agencies and nonprofits; provides a uniform rule regarding application of the integrated mortgage disclosure requirements to cooperative units; and provides guidance on sharing the disclosures with various parties involved in the mortgage origination process. While the Company is still analyzing the final rules, they are not expected to have a material impact on the Company.

In recent years, the CFPB, Office of the Comptroller of Currency and the Federal Reserve have issued memorandums to banks that communicated those agencies’ heightened focus on vetting third-party providers. Such increased regulatory involvement may affect the Company's agents and approved providers. Further proposals to change regulations governing insurance holding companies and the title insurance industry are often introduced in Congress, in state legislatures and before various insurance regulatory agencies. Although the Company regularly monitors such proposals, the likelihood and timing of passage of any such regulation, and the possible effects of any such regulation on the Company and its subsidiaries, cannot be determined at this time.

In recent months, both the President and certain members of Congress have questioned the CFPB's constitutionality and have indicated a desire for reform. The timing and results of reform are currently unknown; however, any changes to the CFPB could affect the Company and its results of operations.

Recently, there have been discussions of reforming current tax law by members of Congress and the President, including revisions to individual and corporate taxes as well as the possibility of eliminating or limiting tax-deferred exchanges currently permitted under Section 1031 of the Internal Revenue Code. The timing and results of implementation of any such changes are currently unknown; however any changes to tax laws could affect the Company and its results of operations.

Real Estate Environment

~~Overall, the economy is expanding and there has been a steady reduction in unemployment in recent years.~~

The Mortgage Bankers Association's ~~(“MBA”~~("MBA") ~~September 2017~~ ~~Economic and~~April 18, 2024 Mortgage Finance ~~Commentary~~ predicts 2017 overall growth in the housing purchase market driven by higher demand from economic and job market strength. The unemployment rate is projected to decrease to 4.2% and wage rates are projected to increase in the medium-term as job openings continue to outpace hiring. Interest rates are likely to rise as the FOMC is projected to raise rates one more time in 2017.

~~The MBA September 12, 2017~~ ~~Mortgage Finance~~ Forecast (“MBA Forecast”) projects ~~2017~~2024 purchase activity to increase ~~9.9%~~5.1% to ~~$1,088~~$1,393 billion and mortgage refinance activity to ~~decrease 36.6%~~increase 34.4% to ~~$571~~$422 billion, resulting in a ~~decrease~~net increase in total mortgage originations of ~~12.3%~~10.7% to ~~$1,659~~$1,815 billion, all from ~~2016~~2023 levels. In ~~2016,~~2023, purchase activity accounted for ~~52.4%~~80.8% of all mortgage originations and is projected in the MBA Forecast to represent ~~65.6%~~76.7% of all mortgage originations in ~~2017.~~

2024. According to data published by Freddie Mac, the average 30-year fixed mortgage interest rates in the United States were ~~4.0%~~6.7% and ~~3.6%~~6.4% for the ~~nine-month~~three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016,~~2023, respectively. Per the MBA Forecast, ~~refinancing is expected to be lower in 2017 as~~ mortgage interest rates are projected to ~~climb~~decrease in subsequent periods, reaching 5.5% in 2026. Due to ~~4.2% in~~ the ~~fourth quarter~~rapidly changing environment brought on by inflationary pressures, inventory constraints, and geopolitical and military conflicts, these projections and the impact of ~~2017.~~actual future developments on the Company could be subject to material change.

Historically, activity in real estate markets has varied over the course of market cycles by geographic region and in response to evolving economic factors. Operating results can vary from year to year based on cyclical market conditions and do not necessarily indicate the Company's future operating results and cash flows.

~~Acquisition of Title Insurance Agency~~

Critical Accounting Estimates and Policies

The preparation of the Company's unaudited Consolidated Financial Statements requires management to make estimates and judgments that affect the reported amounts of certain assets, liabilities, revenues, expenses and related disclosures regarding contingencies and commitments. Actual results could differ from these estimates. During the ~~nine-month~~three-month period ended ~~September 30, 2017,~~March 31, 2024, the Company did not make any material changes to its critical accounting policies as previously disclosed in Management's Discussion and Analysis in the ~~Company's Annual Report on~~2023 Form ~~10-K for the year ended December 31, 2016 as filed with the Securities and Exchange Commission.~~10-K.

Results of Operations

The following table presents certain ~~income statement~~unaudited Consolidated Statements of Operations data for the ~~three- and nine-month~~three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016:~~2023:


	Three Months Ended March 31,
(in thousands)	2024		2023
Revenues:
Net premiums written	$	40,180	$	38,966
Escrow and other title-related fees	3,723		3,655
Non-title services	4,304		5,312
Interest and dividends	2,520		2,074
Other investment income	111		753
Net investment gains	2,422		443
Other	199		140
Total Revenues	53,459		51,343

Operating Expenses:
Commissions to agents	19,870		19,326
Provision for claims	910		1,068
Personnel expenses	18,582		20,820
Office and technology expenses	4,465		4,400
Other expenses	3,835		4,168
Total Operating Expenses	47,662		49,782

Income before Income Taxes	5,797		1,561

Provision for Income Taxes	1,272		380

Net Income	$	4,525	$	1,181

Certain amounts have been reclassified for consistency with the current period presentation. The reclassifications were between revenue lines of the unaudited Consolidated Statements of Operations. These reclassifications are not considered an accounting change and had no effect on the reported results of operations.

Three Months Ended
September 30, Nine Months Ended
September 30,
2017 2016 2017 2016
Revenues:
Net premiums written $ 36,612,558
$ 36,306,522
$ 102,918,454
$ 87,357,972
Investment income – interest and dividends 1,087,054
1,160,983
3,297,634
3,478,999
Net realized gain on investments 803,938
439,326
990,118
574,328
Other 4,633,915
3,094,874
13,864,170
8,280,139
Total Revenues 43,137,465
41,001,705
121,070,376
99,691,438

Operating Expenses:
Commissions to agents 17,641,272
18,739,151
50,569,972
45,946,379
Provision (benefit) for claims 1,854,493
(1,067,853 ) 2,714,717
(403,982 )
Salaries, employee benefits and payroll taxes 9,820,578
8,300,823
29,464,824
22,945,972
Office occupancy and operations 2,309,575
1,496,948
6,445,880
4,526,710
Business development 639,923
608,532
1,987,028
1,695,180
Filing fees, franchise and local taxes 203,912
191,574
935,476
688,731
Premium and retaliatory taxes 673,126
673,551
1,918,951
1,559,631
Professional and contract labor fees 447,651
523,504
1,375,291
1,599,603
Other 630,320
157,308
1,944,419
629,539
Total Operating Expenses 34,220,850
29,623,538
97,356,558
79,187,763

Income before Income Taxes 8,916,615
11,378,167
23,713,818
20,503,675

Provision for Income Taxes 2,990,000
3,249,000
7,647,000
6,040,000

Net Income Attributable to the Company $ 5,926,457
$ 8,126,939
$ 16,077,704
$ 14,470,359

Title Insurance ~~and Other Services~~ Revenues

~~Insurance and other services~~Title insurance revenues include net premiums written ~~plus other title fee income, commission income, trust income, management services income~~ and ~~exchange services income. Investment income and realized investment gains and losses are not included in insurance~~escrow and other title-related income that includes escrow fees, commissions and settlement fees. Non-title services revenue, investment-related revenues and other revenues are discussed separately ~~under “Investment Related Revenues”~~ below.

Title insurance companies typically issue title insurance policies directly through home and branch offices or through title agencies. Following is a breakdown of net premiums generated by home and branch offices and agency operations for the three- and nine-month periods ended September 30, 2017 and 2016:Net Premiums Written

Three Months Ended September 30, Nine Months Ended September 30,
2017 % 2016 % 2017 % 2016 %
Home and Branch $ 10,871,775
29.7 % $ 10,672,619
29.4 % $ 30,296,701
29.4 % $ 24,303,104
27.8 %
Agency 25,740,783
70.3 % 25,633,903
70.6 % 72,621,753
70.6 % 63,054,868
72.2 %
Total $ 36,612,558
100.0 % $ 36,306,522
100.0 % $ 102,918,454
100.0 % $ 87,357,972
100.0 %

~~Home and Branch Office Net Premiums:~~ ~~In the Company's home office and branch operations, the Company retains the entire premium for all title insurance policies issued, as no commissions are paid in connection with these policies.~~ Net premiums written ~~from home and branch operations~~ increased ~~1.9%~~ ~~and 24.7%~~3.1% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024 to $40.2 million, compared with $39.0 million for the same prior year ~~periods.~~period. The ~~slight~~ increase for the three-month period ended ~~September 30, 2017 was primarily~~March 31, 2024 is attributable to ~~an increase~~higher activity levels in ~~purchase transactions with variations in the market mix~~some of business that resulted in a slightly lower average premium per policy. The increase for the nine-month period ended September 30, 2017 was primarily attributable to growth in premium volume stemming from higher levels of homes sales and average real estate values and revised premium rates filed in North Carolina, partially offset by lower refinance activity.our key markets.

During the quarter ended March 31, 2016, the North Carolina Title Insurance Rating Bureau, which establishes premium rates for title insurance in North Carolina, and of which Investors Title Insurance Company is a member, filed updated premium rates that took effect on April 1, 2016. The revised rates positively impacted the Company's branch and agency premiums by approximately $3,047,000 for the nine-month period ended September 30, 2017, compared with $2,400,000 for the same prior year period.

All of the Company's home office operations and the majority of its branch offices are located in North Carolina; as a result, the home and branch office net premiums written are primarily for North Carolina title insurance policies.

~~Agency Net Premiums:~~ ~~When a policy is written through a title agency, the premium is shared between the agency and the underwriter.~~ Total premiums include an estimate of premiums for policies that have been issued directly and by agents, but not reported to the Company as of the balance sheet date. To determine the estimated premiums, the Company uses historical experience, as well as other factors, to make certain assumptions about the average elapsed time between the policy effective date and the date the policies are reported. From time to time, the Company adjusts the inputs to the estimation process as ~~agents report~~reported transactions and new information becomes available. In addition to estimating revenues, the Company also estimates and accrues agent commissions, claims provision, premium taxes, income taxes, and other expenses associated with the estimated revenues that have been accrued. The Company reflects any adjustments to the accruals in the ~~result~~results of operations in the period in which new information becomes available.

Title insurance companies typically issue title insurance policies directly or through title agencies. Following is a breakdown of premiums generated by direct and agency operations for the three-month periods ended March 31, 2024 and 2023:


	Three Months Ended March 31,
(in thousands, except percentages)	2024		%	2023		%
Direct	$	13,321	33.2	$	12,714	32.6
Agency	26,859		66.8	26,252		67.4
Total	$	40,180	100.0	$	38,966	100.0

Direct Net Premiums – The Company's direct business consists of operations at the home office, branch offices, and wholly owned title insurance agencies. In the Company's direct operations, the Company issues a title insurance policy and retains the entire premium, as no commissions are recognized in connection with these policies. Net premiums written from direct operations increased 4.8% for the three-month period ended March 31, 2024, compared with the same prior year period. The increase for the three-month period ended March 31, 2024 is attributable to higher activity levels in some of our key markets.

Agency Net Premiums –When a policy is written through a non-wholly owned title agency, the premium is shared between the agency and the underwriter. The agent retains a majority of the premium as a commission and remits the net amount to the Company. Title insurance commissions earned by the Company’s agents are recognized as expenses concurrently with premium recognition. Agency net premiums written increased ~~0.4% and 15.2%~~2.3% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with the same prior year ~~periods.~~period. The ~~increases~~increase for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017 were primarily~~March 31, 2024 is attributable to ~~the addition~~higher activity levels in some of new title insurance agents in the Company's Texas and southeast markets, higher levels of real estate activity from existing agents and overall higher home prices, partially offset by lower refinance activity.our key markets.

Following is a schedule of net premiums written for the ~~three- and nine-month~~three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~2023 in select states in which the Company's two insurance subsidiaries, ITIC and NITIC, currently ~~write~~underwrite title insurance:


														Three Months Ended March 31,
	Three Months Ended September 30,						Nine Months Ended September 30,
State	2017			2016			2017			2016
State (in thousands)													State (in thousands)	2024	2023
North Carolina	$	14,128,480		$	13,782,187		$	39,502,056		$	31,540,890
Texas	7,294,401			7,069,431			20,153,555			17,367,044
South Carolina	3,698,254			3,541,902			10,357,916			8,312,574
Georgia	3,493,075			3,498,742			9,160,373			8,013,787
Virginia	1,614,801			1,756,468			4,486,593			4,745,121
All Others	6,460,531			6,686,540			19,448,956			17,437,969
Premiums	36,689,542			36,335,270			103,109,449			87,417,385
Premiums Written
Reinsurance Assumed	—			—			2,756			10,946
Reinsurance Ceded	(76,984		)	(28,748		)	(193,751		)	(70,359		)
Net Premiums Written	$	36,612,558		$	36,306,522		$	102,918,454		$	87,357,972

Escrow and Other Title-Related Fees

~~Other Revenues~~

~~Other revenues~~Escrow and other title-related fees consists primarily ~~include~~of commission income, escrow and other various fees associated with the issuance of a title insurance policy including settlement, examination and closing fees. Escrow and other title-related fee ~~income,~~revenues were virtually unchanged at $3.7 million for the three-month periods ended March 31, 2024 and 2023.

Revenue from Non-Title Services

Revenue from non-title services includes trust ~~income,~~services, agency management services ~~income,~~and exchange services ~~income, state tax credit income and income related to the Company’s equity method investments. Other~~income. Non-title service revenues were ~~$4,633,915 and $13,864,170~~$4.3 million for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~$3,094,874 and $8,280,139~~$5.3 million for the same prior year ~~periods.~~period. The ~~increase~~decrease for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017~~March 31, 2024 was primarily related to ~~increases~~a decrease in ~~revenue from title fees~~like-kind exchange revenues.

Investment-Related Revenues

Investment-related revenues include interest and ~~commission income from title agencies.~~

~~Investment Related Revenues~~

~~Investment~~dividends, other investment income, and ~~realized gains~~net investment gains.

Interest and ~~losses from investments are included in investment related revenues.~~Dividends

~~Investment Income~~

The Company derives a ~~substantial~~ portion of its income from investments in short-term investments, fixed maturity securities, which are primarily municipal and corporate ~~bonds~~fixed maturity securities, and equity securities. The Company’s investment policy is designed to comply with regulatory requirements and to balance the competing objectives of asset quality and investment returns. The Company's title insurance subsidiaries are required by statute to maintain minimum levels of investments in order to protect the interests of policyholders. ~~The Company’s investment policy is designed to comply with regulatory requirements and to balance the competing objectives of asset quality and investment returns.~~

The Company’s investment strategy emphasizes after-tax income and principal preservation. The Company’s investments are primarily in ~~bonds~~short-term investments, fixed maturity securities and ~~to a lesser extent,~~ equity securities. The average effective maturity of the majority of the ~~bonds~~fixed maturity securities is less than 10 years. The Company’s invested assets are managed to fund its obligations and evaluated to ensure long term stability of capital accounts.

As the Company generates cash from operations, it is invested in accordance with the Company’s investment policy and corporate goals. The Company’s investment policy has been designed to balance multiple goals, including the assurance of a stable source of income from interest and dividends, the preservation of principal, and the provision of liquidity sufficient to meet insurance underwriting and other obligations as they become payable in the future. Securities purchased may include a combination of taxable ~~bonds,~~or tax-exempt ~~bonds~~fixed maturity securities and equity securities. The Company also invests in short-term investments that typically include money market funds, U.S. Treasury bills, commercial paper ~~money-market funds~~ and certificates of deposit. ~~In addition, the Company holds other investments that are primarily investments in partnerships structured as limited liability companies.~~ The Company strives to maintain a high quality investment portfolio. Since 2022, the Company has been purchasing higher levels of short-term investments to take advantage of elevated short-term interest rates during this period of uncertainty in the investment market.

Interest and ~~investment~~dividends were $2.5 million for the three-month period ended March 31, 2024, compared with $2.1 million for the same prior year period. Interest and dividend income levels are primarily a function of general market performance, interest rates and the amount of cash available for ~~investment.~~investments that meet the Company's investment policy. The increase for the three-month period ended March 31, 2024 was primarily related to an increase in interest received due to higher interest rates and levels of short-term investments and fixed maturity securities.

Other Investment Income

Other investment income consists primarily of income related to investments in unconsolidated affiliates, typically structured as limited liability companies ("LLCs"), accounted for under either the equity method of accounting or the measurement alternative for investments that do not have readily determinable fair values. The measurement alternative method requires investments without readily determinable fair values to be recorded at cost, less impairments, and plus or minus any changes resulting from observable price changes. The Company monitors any events or changes in circumstances that may have had a significant adverse effect on the fair value of these investments and makes any necessary adjustments.

Other investment income was ~~$1,087,054 and $3,297,634~~$111 thousand for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared ~~with $1,160,983 and $3,478,999~~$753 thousand for the same prior year ~~periods. The decrease~~period. Changes in other investment income are impacted by fluctuations in the carrying value of the underlying investment and/or distributions received.

Net Investment Gains

Net investment gains include realized gains and losses on the sale of investment securities and changes in the estimated fair value of equity security investments. Net investment gains were $2.4 million for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017 was primarily due to a lower level of investments in fixed income securities, partially offset by an increase in equity securities.~~March 31, 2024, compared with $443 thousand for the same prior year period.

Net Realized ~~Gain on Investments~~

Investment Gains and Losses –Dispositions of equity securities at a realized gain or loss reflect such factors as industry sector allocation decisions, ongoing assessments of issuers’ business prospects and tax planning considerations. Additionally, the amounts ofincluded in net ~~realized~~ investment gains ~~and losses~~ are affected by assessments of securities’ valuation for ~~other-than-temporary~~ impairment. As a result of the interaction of these factors and considerations, the net realized investment gain or loss can vary significantly from period to period.

The net realized ~~gain on investments was $803,938 and $990,118~~investment gains were $2.6 million for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~$439,326 and $574,328~~$7.2 million for the same prior year ~~periods.~~period. The net realized gain on investments for the nine-month period ended September 30, 2017 did not include any impairment charges. The net realized gain on investments for the nine-month period ended September 30, 2016 includedCompany recorded impairment charges of ~~$233,941~~$53 thousand and $82 thousand on certain ~~investments~~fixed maturity securities where the intent to hold had changed in the three-month periods ended March 31, 2024 and ~~other assets that were deemed to be other-than-temporarily impaired, offset by a net realized gain on the sales of investments and other assets of $808,269.~~2023, respectively. Management believes unrealized losses on the remaining fixed ~~income and equity~~maturity securities at ~~September 30, 2017~~March 31, 2024 are ~~temporary in nature.~~not credit related.

The securities in the Company’s investment portfolio are subject to economic conditions and market risks. The Company considers relevant facts and circumstances in evaluating whether a credit or interest-related impairment of a fixed maturity security ~~is other-than-temporary.~~has occurred. Relevant facts and circumstances include the extent and length of time the fair value of an investment has been below cost.

There are a number of risks and uncertainties inherent in the process of monitoring impairments and determining if an impairment ~~is other-than-temporary.~~exists. These risks and uncertainties include the risk that the economic outlook will be worse than expected or have more of an impact on the issuer than anticipated; the risk that the Company’s assessment of an issuer’s ability to meet all of its contractual obligations will change based on changes in the characteristics of that issuer; the risk that information obtained by the Company or changes in other facts and circumstances leads management to change its intent to ~~hold the equity security until it recovers in value or its intent to~~ sell the ~~debt~~fixed maturity security; and the risk that management is making decisions based on ~~misstated~~inaccurate information in the financial statements provided by the issuers.

Changes in the Estimated Fair Value of Equity Security Investments –Changes in the estimated fair value of equity security investments were $(169) thousand for the three-month period ended March 31, 2024, compared with $(6.8) million for the same prior year period. Such fluctuations are the result of changes in general market conditions during the respective periods, however, the sale of appreciated investment securities can result in a reduction in unrealized gains as they are reclassified to net realized investment gains, which is not indicative of a decline in estimated fair value.

Other Revenues

Other revenues primarily include miscellaneous income and gains and losses on the disposal of fixed assets and real estate and rental income. Other revenues were $199 thousand for the three-month period ended March 31, 2024, compared with $140 thousand for the same prior year period.

Expenses

The Company's operating expenses consist primarily of commissions to agents, ~~salaries, employee benefits~~personnel expenses, office and ~~payroll taxes, office occupancy and operations~~technology expenses and the provision for claims. Operating expenses ~~increased 15.5% and 22.9%~~decreased 4.3% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with the same prior year ~~periods.~~period. The ~~increase~~decrease for the three-month period ended ~~September 30, 2017~~March 31, 2024 was primarily due to ~~increases~~a decline in ~~the provision for claims, salaries, employee benefits~~personnel expenses and ~~payroll taxes and office and occupancy~~other expenses, partially offset by ~~a decrease~~an increase in ~~commissions. The increase for the nine-month period ended September 30, 2017 was primarily due~~commissions to increases in salaries, employees benefits and payroll taxes, commissions, the provision for claims and office occupancy and operations. In addition, the inclusion of expenses for a title agency acquired in the fourth quarter of 2016 contributed to the higher expense levels for the three- and nine- month periods ended September 30, 2017.agents.

Following is a summary of the Company's operating expenses for the ~~three- and nine-month~~three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016~~.2023. Inter-segment eliminations have been netted; therefore, the individual segment amounts will not agree to Note 4 into the ~~accompanying~~unaudited Consolidated Financial ~~Statements.~~Statements in this Quarterly Report on Form 10-Q.


																		Three Months Ended March 31,
	Three Months Ended September 30,								Nine Months Ended September 30,
	2017		%		2016		%		2017		%		2016		%
(in thousands, except percentages)																	(in thousands, except percentages)	2024	%	2023	%
Title Insurance	$	32,332,682	94.5	%	$	27,967,210	94.4	%	$	91,654,372	94.1	%	$	74,302,399	93.8	%
Exchange Services
All Other	1,888,168		5.5	%	1,656,328		5.6	%	5,702,186		5.9	%	4,885,364		6.2	%
Total	$	34,220,850	100.0	%	$	29,623,538	100.0	%	$	97,356,558	100.0	%	$	79,187,763	100.0	%

On a combined basis, the after-tax profit ~~margins were 13.7% and 13.3%~~margin was 8.5% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively, and 19.8% and 14.5%~~March 31, 2024, compared with 2.3% for the ~~three-~~same prior year period. The increase for the three-month period ended March 31, 2024 was primarily due to increases in premiums and ~~nine-month periods ended~~ ~~September 30, 2016, respectively.~~net investment gains and decreases in personnel costs and other overhead expense categories. The Company continually strives to enhance its competitive strengths and market position, including ongoing initiatives to ~~reduce~~manage its operating expenses.

~~Salaries, Employee Benefits and Payroll Taxes:~~

Personnel ~~costs~~Expenses –Personnel expenses include base salaries, benefits and payroll taxes, ~~and~~ bonuses paid to ~~employees. Salaries, employee benefits~~employees and ~~payroll taxes~~contract labor expenses. Personnel expenses were ~~$9,820,578 and $29,464,824~~$18.6 million for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~$8,300,823 and $22,945,972~~$20.8 million for the same prior year ~~periods.~~period. On a consolidated basis, ~~salaries, employee benefits and payroll taxes~~personnel expenses as a percentage of total revenues were ~~22.8% and 24.3%~~34.8% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~20.2% and 23.0%~~40.6% for the same prior year ~~periods.~~period. The ~~increases~~decrease in ~~payroll~~personnel expenses for the three-month period ended ~~September 30, 2017~~March 31, 2024 was primarily ~~related~~due to ~~increases in salaries, benefits~~reduced staffing levels.

Office and ~~payroll~~Technology Expenses –Office and technology expenses ~~associated with~~primarily include facilities expenses, software and hardware expenses, depreciation expense, telecommunications expenses, and business insurance. Office and technology expenses were $4.5 million and $4.4 million for the ~~acquisition~~three-month periods ended March 31, 2024 and 2023, respectively.

Other Expenses – Other expenses primarily include business development expenses, premium-related taxes and licensing, professional services, title and service fees, amortization of ~~a title agency that was acquired in the fourth quarter of 2016~~intangible assets and other ~~staffing and inflationary increases. The increase~~general expenses. Other expenses were $3.8 million for ~~the nine-month period ended September 30, 2017 was primarily attributable to the same factors as~~ the three-month period ended ~~September 30, 2017, in addition to higher levels of incentive compensation.~~

Commissions to Agents –Agent commissions represent the portion of premiums retained by agents pursuant to the terms of their respective agency contracts. Commissions to agents ~~decreased~~ ~~5.9%~~ ~~and~~ increased ~~10.1%~~2.8% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with the same prior year ~~periods.~~period. Commission expense as a percentage of net premiums written by agents was ~~68.5% and 69.6%~~74.0% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~73.1% and 72.9%~~73.6% for the same prior year ~~periods.~~period. The lower commission expense as a percentage of net premiums written in 2017 and the lower commission expense for the three-month period ended September 30, 2017 were primarily due to the elimination of intercompany commissions for affiliated agents upon consolidation and changes in geographic mix. The increasechange in commission expense ~~for the nine-month period ended September 30, 2017~~ was primarily ~~attributable~~related to ~~higher~~the increase in agent premium volume. Commission rates vary by market due to local practice, competition and state regulations.

Provision for ~~Claims:~~ Claims – The provision for claims decreased $158 thousand for the three-month period ended March 31, 2024, compared with the same prior year period. The provision for claims as a percentage of net premiums written was ~~5.1%~~ ~~and 2.6%~~2.3% for the ~~three- and nine-month periods~~three-month period ended~~September 30, 2017, respectively,~~ March 31, 2024, compared with ~~(2.9)%~~ ~~and (0.5)%~~2.7% for the same prior year ~~periods.~~ period. The ~~increase~~decrease in the provision for claims for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017 compared with the same prior year periods~~March 31, 2024 was primarily ~~related~~due to a higher level of favorable loss development and less incurred claims losses in ~~2016 for policy years 2009 through 2015.~~ the current year period.

~~Reserves for Claims:~~ At ~~September 30, 2017~~,March 31, 2024, the total reserve for claims was $~~35,207,000~~.$37.3 million. Of that total, approximately ~~$4,875,000~~$3.2 million was reserved for specific claims, and approximately ~~$30,332,000~~$34.1 million was reserved for claims for which the Company had no notice. Because of the uncertainty of future claims, changes in economic conditions and the fact that claims may not materialize for several years, reserve estimates are subject to variability.

Changes from prior periods in the expected liability for claims reflect the uncertainty of the claims environment, as well as the limited predictive power of historical data. The Company continually updates and refines its reserve estimates as current experience develops and credible data emerges. Such data includes payments on claims closed during the quarter, new details that emerge on open cases that cause claims adjusters to increase or decrease the case reserves, and the impact that these types of changes have on the Company’s total loss provision. Adjustments may be required as new information develops, which often varies from past experience.

~~Premium and Retaliatory Taxes~~: Title insurance companies are generally not subject to state income or franchise taxes. However, in most states they are subject to premium and retaliatory taxes, as defined by statute. Premium and retaliatory tax rates vary from state to state; accordingly, the total premium and retaliatory tax incurred is dependent upon the geographical mix of insurance revenues. Premium and retaliatory taxes as a percentage of net premiums written were 1.8% and 1.9% for the three- and nine-month periods ended September 30, 2017, respectively, compared with 1.9% and 1.8% for the same prior year periods.

The provision for income taxes was ~~$2,990,000 and $7,647,000~~$1.3 million for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~$3,249,000 and $6,040,000~~$380 thousand for the same prior year ~~periods.~~period. Income tax expense, including federal and state taxes, as a percentage of ~~earnings~~income before income taxes was ~~33.5% and 32.2%~~21.9% for the ~~three- and nine-month periods~~three-month period ended ~~September 30, 2017, respectively,~~March 31, 2024, compared with ~~28.6% and 29.5%~~24.3% for the same prior year ~~periods.~~period. The effective income tax ~~rate~~rates for both ~~2017~~2024 and ~~2016~~ ~~was below~~2023 differ from the U.S. federal statutory income tax rate of ~~34%,~~21% primarily due to the ~~effect~~effects of state taxes and tax-exempt income. Tax-exempt income lowers the effective tax rate.

The Company believes it is more likely than not that the tax benefits associated with recognized ~~impairment~~impairments and unrecognized losses recorded through ~~September 30, 2017~~March 31, 2024 will be realized. However, this judgment could be impacted by further market fluctuations.

Liquidity and Capital Resources

The Company’s ~~current~~material cash requirements include general operating expenses, contractual and other obligations for the future payment of title claims, employment agreements, lease agreements, income taxes, capital expenditures, dividends on its common stock and ~~repurchases~~other contractual commitments for goods and services needed for operations. All other arrangements entered into by the Company are not reasonably likely to have a material effect on liquidity or the availability of ~~its commons stock.~~capital resources. Cash flows from operations have historically been the primary source of financing for expanding operations, whether through organic growth or outside investments. The Company believes its balances of cash, short-term investments and other readily marketable securities, along with cash flows generated by ongoing operations, will be sufficient to satisfy its cash requirements over the next 12 months and thereafter, including the funding of operating activities and commitments for investing and financing activities. There are currently no known trends that the Company believes will materially impact the Company’s capital resources, nor is the Company anticipating any material changes in the mix or relative cost of such resources except as otherwise disclosed in the Business Trends and Recent Conditions section of this Management's Discussion and Analysis.

The Company evaluates nonorganic growth opportunities, such as mergers and acquisitions, from time to time in the ordinary course of business. Because of the episodic nature of these events, related incremental liquidity and capital resource needs can be difficult to predict.

The Company’s operating results and cash flows are heavily dependent on the real estate market. The Company’s business has certain fixed costs such as personnel; therefore, changes in the real estate market are monitored closely, and operating expenses such as staffing levels are managed and adjusted accordingly. The Company believes that its significant working capital position and management of operating expenses will aid its ability to manage cash resources through fluctuations in the real estate market.

Cash ~~Flows:~~ Flows –Net cash flows provided by (used in) operating activities were ~~$18,863,290~~$1.4 million and ~~$14,794,003~~$(13.1) million for the ~~nine-month~~three-month periods ended ~~September 30, 2017~~March 31, 2024 and ~~2016,~~2023, respectively. Cash flows ~~from~~provided by (used in) operating activities ~~increased in 2017~~differ from ~~2016, primarily~~net income due to ~~an increases~~adjustments for non-cash items, such as changes in ~~accounts payable,~~ the ~~provision~~estimated fair value of equity security investments, gains and losses on investments and property, the timing of disbursements for taxes, claims and ~~net income, partially offset by a decrease~~other accrued liabilities, and collections or changes in ~~the provision for deferred taxes.~~receivables and other assets.

Cash flows from non-operating activities have historically consisted of purchases and proceeds from investing activities, the issuance of dividends and repurchases of common ~~stock and~~stock. Net cash was used in investing activities for the ~~payment of dividends. In 2017, the Company had higher levels of investment purchase activity, payment of dividends and purchases of property, partially offset~~three-month period ended March 31, 2024, compared with net cash being provided by ~~lower repurchases of common stock compared with~~investing activities in the prior year period.

The Company maintains a high degree of liquidity within its investment portfolio ~~classified as available-for-sale,~~ in the form of cash, short-term investments and other readily marketable securities. As of ~~September 30, 2017,~~March 31, 2024, the Company held cash and cash equivalents of ~~$30,890,785,~~$21.6 million, short-term investments of ~~$20,692,763,~~$113.4 million, available-for-sale fixed maturity securities of ~~$100,730,446~~$62.6 million and equity securities of ~~$45,116,461.~~$36.7 million. The net effect of all activities on total cash and cash equivalents was ~~an increase~~a decrease of ~~$2,962,313~~$2.4 million in ~~2017.~~2024. Beginning in late 2022, ongoing evaluation of changing business and financial market conditions led to portions of cash flow from operations, and certain amounts resulting from sales and maturities in the company’s investment portfolio, to be invested in short term investments to take advantage of elevated short-term interest rates.

Capital ~~Resources:~~ Resources –The amount of capital resources the Company maintains is influenced by state regulation, the need to maintain superior financial ratings from third-party rating agencies and other marketing and operational considerations.

The Company's significant sources of funds are dividends and distributions from its subsidiaries, primarily its two title insurance subsidiaries. Cash is received from its subsidiaries in the form of dividends and as reimbursements for operating and other administrative expenses that it incurs. The reimbursements are executed within the guidelines of management agreements between the Company and its subsidiaries.

The ability of the Company's title insurance subsidiaries to pay dividends to the Company is subject to state regulation from their respective states of domicile. Each state regulates the extent to which title underwriters can pay dividends or make distributions and requires prior regulatory approval of the payment of dividends and other intercompany transfers. The maximum dividend permitted by law is not necessarily indicative of an insurer’s actual ability to pay dividends. Depending on regulatory conditions, the Company may in the future need to retain cash in its title insurance subsidiaries in order to maintain their statutory capital position. As of ~~September 30, 2017,~~March 31, 2024, both ITIC and NITIC met the minimum capital, surplus and reserve requirements for each state in which they are licensed.

While state regulations and the need to cover risks may set a minimum level for capital requirements, other factors necessitate maintaining capital resources in excess of the required minimum amounts. For instance, the Company’s capital resources help it maintain high ratings from insurance company rating agencies. Superior ratings strengthen the Company's ability to compete with larger, well known title insurers with national footprints.

A strong financial position provides the necessary flexibility to fund potential acquisition activity, to invest in the Company's core business, and to minimize the financial impact of potential adverse developments. Adverse developments that generally require additional capital include adverse financial results, changes in statutory accounting requirements by regulators, reserve charges, investment losses or costs incurred to adapt to a changing regulatory environment, including costs related to ~~CFPB~~Consumer Financial Protection Bureau regulation of the real estate industry.

The Company bases its capitalization levels, in part, on net coverage retained. Since the Company’s geographical focus has been and continues to be concentrated in states with average premium rates typically lower than the national average, capitalization relative to premiums will usually appear higher than industry averages.

Due to the Company’s historical ability to consistently generate positive cash flows from its consolidated operations and investment income, management believes that funds generated from operations will enable the Company to adequately meet its current operating needs for the foreseeable future. However, given inflationary pressures and geopolitical and military conflicts, there can be no assurance that future experience will be similar to historical experience, since it is influenced by such factors as the interest rate environment, real estate activity, the Company’s claims-paying ability and its financial strength ratings. In addition to operational and investment considerations, taking advantage of opportunistic external growth opportunities may necessitate obtaining additional capital resources. The Company is ~~unaware of any trend~~carefully monitoring inflation, geopolitical and military conflicts, and other trends that ~~is likely to~~could potentially result in material adverse liquidity changes, ~~but~~and will continually ~~assesses~~assess its capital allocation strategy, including decisions relating to payment of dividends, repurchasing the Company’s common stock and/or conserving cash.

Purchase of Company Stock:– On November 9, 2015, the Board of Directors of the Company approved the purchase of an additional 163,335 shares pursuant to the Company’s repurchase plan, such that there was authority remaining under the plan to purchase up to an aggregate of 500,000 shares of the Company’s common stock pursuant to the plan immediately after this ~~approval.~~approval. Unless terminated earlier by resolution of the Board of Directors, the plan will expire when all shares authorized for purchase under the plan have been purchased. ~~Pursuant to~~The Company purchased 6,763 shares in the ~~Company’s ongoing purchase program, the Company has purchased 300~~three-month period ended March 31, 2024 and no shares ~~for the nine-month period ended September 30, 2017 and 66,803 shares for~~in the same ~~period in 2016 at an average per share price of $165.35 and $93.10, respectively.~~prior year period. The Company anticipates making further purchases under this plan from time to time in the future, depending on such factors as the prevailing market ~~price~~prices of the ~~Company’s~~Company's common stock, the ~~Company’s~~Company's available cash and ~~then~~the existing alternative uses for such cash.

Capital ~~Expenditures:~~ Expenditures –Capital ~~Expenditures were~~expenditures were approximately ~~$2,343,000~~$2.2 million for the ~~nine-month~~three-month period ended ~~September 30, 2017.~~March 31, 2024. In ~~2017,~~2024, the Company has plans for various capital improvement projects, including increased investment in a number of technology and system development initiatives and hardware purchases which are anticipated to be funded via cash flows from operations. All material anticipated capital expenditures are subject to periodic review and revision and may vary depending on a number of factors.

Contractual Obligations - As of March 31, 2024, the Company had a claims reserve totaling $37.3 million. The amounts and timing of these obligations are estimated and not set contractually. Events such as fraud, defalcation, and multiple property title defects can substantially and unexpectedly cause increases in both the amount and timing of estimated title insurance loss payments and loss cost trends whereby increases or decreases in inflationary factors (including the value of real estate) will influence the ultimate amount of title insurance loss payments and could increase total obligations and influence claim payout patterns. Due to the length of time over which claim payments are made and regularly occurring changes in underlying economic and market conditions, claim estimates are subject to variability and future payments could increase or decrease from these estimated amounts in the future.


						March 31, 2024	December 31, 2023
	September 30, 2017		December 31, 2016
Assets:
Investments in securities:
Fixed maturities, available-for-sale, at fair value (amortized cost: September 30, 2017: $97,840,656; December 31, 2016: $100,162,357)	$	100,730,446	$	101,934,077
Equity securities, available-for-sale, at fair value (amortized cost: September 30, 2017: $25,927,969; December 31, 2016: $24,836,032)	45,116,461		41,179,259
Assets					Assets
Cash and cash equivalents
Investments:					Investments:
Fixed maturity securities, available-for-sale, at fair value (amortized cost: March 31, 2024: $62,277; December 31, 2023: $63,106)
Equity securities, at fair value (cost: March 31, 2024: $22,647; December 31, 2023: $22,981)
Short-term investments	20,692,763		6,558,840
Other investments	11,514,780		11,181,531
Total investments	178,054,450		160,853,707

Cash and cash equivalents	30,890,785		27,928,472
Premium and fees receivable	10,260,167		8,654,161
Premiums and fees receivable
Premiums and fees receivable
Premiums and fees receivable
Accrued interest and dividends	1,323,598		1,035,152
Prepaid expenses and other assets	9,211,784		9,456,523
Prepaid expenses and other receivables
Property, net	10,029,847		8,753,466
Goodwill and other intangible assets	11,785,945		12,256,641
Current income taxes receivable	1,641,144		—
Goodwill and other intangible assets, net
Lease assets
Other assets
Current income taxes recoverable
Total Assets	$	253,197,720	$	228,938,122

Liabilities and Stockholders’ Equity
Liabilities and Stockholders’ Equity
Liabilities and Stockholders’ Equity
Liabilities:					Liabilities:
Reserves for claims	$	35,207,000	$	35,305,000
Reserve for claims
Accounts payable and accrued liabilities	31,462,305		26,146,480
Lease liabilities
Current income taxes payable	—		1,232,432
Deferred income taxes, net	14,397,180		11,118,256
Total liabilities	81,066,485		73,802,168

Commitments and Contingencies	—		—
Commitments and Contingencies
Commitments and Contingencies

Stockholders’ Equity:
Preferred stock (1,000,000 authorized shares; no shares issued)	—		—
Common stock – no par value (10,000,000 authorized shares; 1,887,026 and 1,884,283 shares issued and outstanding as of September 30, 2017 and December 31, 2016, respectively, excluding in each period 291,676 shares of common stock held by the Company)	1		1
Stockholders’ Equity:
Stockholders’ Equity:
Preferred stock (1,000 authorized shares; no shares issued)
Common stock – no par value (10,000 authorized shares; 1,884 and 1,891 shares issued and outstanding as of March 31, 2024 and December 31, 2023, respectively, excluding in each period 292 shares of common stock held by the Company)
Retained earnings	157,675,541		143,283,621
Accumulated other comprehensive income	14,375,694		11,761,447
Total stockholders’ equity attributable to the Company	172,051,236		155,045,069
Noncontrolling interests	79,999		90,885
Total stockholders' equity	172,131,235		155,135,954
Total Liabilities and Stockholders’ Equity	$	253,197,720	$	228,938,122



	Three Months Ended September 30,						Nine Months Ended September 30,
	2017			2016			2017			2016
Net income	$	5,926,615		$	8,129,167		$	16,066,818		$	14,463,675
Other comprehensive income, before tax:
Amortization of unrecognized loss	2,153			2,235			6,459			6,705
Unrealized gains (losses) on investments arising during the period	1,878,509			(769,328		)	4,940,599			3,518,286
Reclassification adjustment for sales of securities included in net income	(803,938		)	(545,925		)	(976,888		)	(785,517		)
Reclassification adjustment for write-downs of securities included in net income	—			118,703			—			233,941
Other comprehensive income (loss), before tax	1,076,724			(1,194,315		)	3,970,170			2,973,415
Income tax expense related to postretirement health benefits	732			759			2,194			2,279
Income tax expense (benefit) related to unrealized gains (losses) on investments arising during the period	642,992			(280,327		)	1,687,783			1,193,241
Income tax benefit related to reclassification adjustment for sales of securities included in net income	(274,419		)	(185,316		)	(334,054		)	(268,548		)
Income tax expense related to reclassification adjustment for write-downs of securities included in net income	—			40,555			—			79,900
Net income tax expense (benefit) on other comprehensive income (loss)	369,305			(424,329		)	1,355,923			1,006,872
Other comprehensive income (loss)	707,419			(769,986		)	2,614,247			1,966,543
Comprehensive Income	$	6,634,034		$	7,359,181		$	18,681,065		$	16,430,218
Comprehensive (gain) loss attributable to noncontrolling interests	(158		)	(2,228		)	10,886			6,684
Comprehensive Income Attributable to the Company	$	6,633,876		$	7,356,953		$	18,691,951		$	16,436,902


(in thousands, except percentages)	March 31, 2024		%	December 31, 2023		%
Known title claims	$	3,216	8.6	$	2,855	7.7
IBNR	34,100		91.4	34,292		92.3
Total reserve for claims	$	37,316	100.0	$	37,147	100.0



	2017	2016
Expected Life in Years	7.0	7.0
Volatility	26.2%	28.9%
Interest Rate	2.0%	1.7%
Yield Rate	1.0%	1.0%



Three Months Ended September 30, 2017	Title Insurance		All Other		Intersegment Eliminations			Total
Insurance and other services revenues	$	41,095,694	$	1,985,959	$	(1,835,180	)	$	41,246,473
Investment income	1,067,565		136,159		(116,670		)	1,087,054
Net realized gain on investments	749,396		54,542		—			803,938
Total revenues	$	42,912,655	$	2,176,660	$	(1,951,850	)	$	43,137,465
Operating expenses	34,127,244		1,911,366		(1,817,760		)	34,220,850
Income before income taxes	$	8,785,411	$	265,294	$	(134,090	)	$	8,916,615
Total assets	$	201,137,770	$	52,059,950	$	—		$	253,197,720



	Common Stock				Retained Earnings			Accumulated Other Comprehensive Income		Noncontrolling Interests			Total Stockholders’ Equity
	Shares		Amount		Retained Earnings			Accumulated Other Comprehensive Income		Noncontrolling Interests			Total Stockholders’ Equity
Balance, January 1, 2016	1,949,797		$	1	$	131,186,866		$	11,483,015	$	107,198		$	142,777,080
Net income attributable to the Company					14,470,359								14,470,359
Dividends paid ($0.52 per share)					(993,534		)						(993,534		)
Repurchases of common stock	(66,803	)			(6,219,670		)						(6,219,670		)
Exercise of stock appreciation rights	1,289				(200		)						(200		)
Share-based compensation expense related to stock appreciation rights					99,755								99,755
Amortization related to postretirement health benefits								4,426					4,426
Net unrealized gain on investments								1,962,117					1,962,117
Net loss attributable to noncontrolling interests										(6,684		)	(6,684		)
Purchase of noncontrolling interest of subsidiary										(8,646		)	(8,646		)
Additional paid-in capital from purchase of noncontrolling interest of subsidiary					(496		)						(496		)
Income tax benefit from share-based compensation					32,292								32,292
Balance, September 30, 2016	1,884,283		$	1	$	138,575,372		$	13,449,558	$	91,868		$	152,116,799

Balance, January 1, 2017	1,884,283		$	1	$	143,283,621		$	11,761,447	$	90,885		$	155,135,954
Net income attributable to the Company					16,077,704								16,077,704
Dividends paid ($0.95 per share)					(1,792,430		)						(1,792,430		)
Repurchases of common stock	(300	)			(49,604		)						(49,604		)
Exercise of stock appreciation rights	3,043				(737		)						(737		)
Share-based compensation expense related to stock appreciation rights					156,987								156,987
Amortization related to postretirement health benefits								4,265					4,265
Net unrealized gain on investments								2,609,982					2,609,982
Net loss attributable to noncontrolling interests										(10,886		)	(10,886		)
Balance, September 30, 2017	1,887,026		$	1	$	157,675,541		$	14,375,694	$	79,999		$	172,131,235



	September 30, 2017			December 31, 2016
Balance, beginning of period	$	35,305,000		$	37,788,000
Provision, charged to operations	2,714,717			242,953
Payments of claims, net of recoveries	(2,812,717		)	(2,725,953		)
Balance, end of period	$	35,207,000		$	35,305,000



	Number Of Shares		Weighted Average Exercise Price		Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2016	22,000		$	57.04	3.93	$	945,055
SARs granted	4,500		93.87
SARs exercised	(2,000	)	32.00
Outstanding as of December 31, 2016	24,500		$	65.85	3.85	$	836,640
SARs granted	4,500		192.71
SARs exercised	(4,000	)	36.38
Outstanding as of September 30, 2017	25,000		$	93.40	4.23	$	2,203,100

Exercisable as of September 30, 2017	22,750		$	83.58	4.00	$	2,203,100

Unvested as of September 30, 2017	2,250		$	192.71	6.63	$	—


(in thousands, except weighted average exercise price and average remaining contractual term)	Number Of Shares	Weighted Average Exercise Price		Average Remaining Contractual Term (Years)	Aggregate Intrinsic Value
Outstanding as of January 1, 2023	39	$	159.39	4.10	$	243
SARs granted	5	142.88
SARs exercised	(2)	93.87
Outstanding as of December 31, 2023	42	$	160.83	3.69	$	428
SARs granted	—	—
SARs exercised	—	—
Outstanding as of March 31, 2024	42	$	160.83	3.44	$	451

Exercisable as of March 31, 2024	36	$	163.77	3.22	$	331

Unvested as of March 31, 2024	6	$	143.79	4.70	$	120



Three Months Ended September 30, 2016	Title Insurance		All Other			Intersegment Eliminations			Total
Insurance and other services revenues	$	38,285,551	$	1,666,214		$	(550,369	)	$	39,401,396
Investment income	1,079,118		140,201			(58,336		)	1,160,983
Net realized gain (loss) on investments	439,501		(175		)	—			439,326
Total revenues	$	39,804,170	$	1,806,240		$	(608,705	)	$	41,001,705
Operating expenses	28,487,268		1,669,217			(532,947		)	29,623,538
Income before income taxes	$	11,316,902	$	137,023		$	(75,758	)	$	11,378,167
Total assets	$	180,436,004	$	42,672,325		$	—		$	223,108,329



Nine Months Ended September 30, 2017	Title Insurance		All Other		Intersegment Eliminations			Total
Insurance and other services revenues	$	115,573,247	$	5,495,136	$	(4,285,759	)	$	116,782,624
Investment income	3,168,384		406,342		(277,092		)	3,297,634
Net realized gain on investments	893,554		96,564		—			990,118
Total revenues	$	119,635,185	$	5,998,042	$	(4,562,851	)	$	121,070,376
Operating expenses	95,818,759		5,771,296		(4,233,497		)	97,356,558
Income before income taxes	$	23,816,426	$	226,746	$	(329,354	)	$	23,713,818
Total assets	$	201,137,770	$	52,059,950	$	—		$	253,197,720



Nine Months Ended September 30, 2016	Title Insurance		All Other		Intersegment Eliminations			Total
Insurance and other services revenues	$	92,055,531	$	5,137,268	$	(1,554,688	)	$	95,638,111
Investment income	3,206,093		424,578		(151,672		)	3,478,999
Net realized gain on investments	513,624		60,704		—			574,328
Total revenues	$	95,775,248	$	5,622,550	$	(1,706,360	)	$	99,691,438
Operating expenses	75,766,983		4,923,205		(1,502,425		)	79,187,763
Income before income taxes	$	20,008,265	$	699,345	$	(203,935	)	$	20,503,675
Total assets	$	180,436,004	$	42,672,325	$	—		$	223,108,329



As of December 31, 2016	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Fixed maturities, available-for-sale, at fair value:
General obligations of U.S. states, territories and political subdivisions	$	29,374,774	$	440,628	$	298,533	$	29,516,869
Special revenue issuer obligations of U.S. states, territories and political subdivisions	57,459,818		1,619,444		502,135		58,577,127
Corporate debt securities	13,327,765		512,316		—		13,840,081
Total	$	100,162,357	$	2,572,388	$	800,668	$	101,934,077
Equity securities, available-for-sale, at fair value:
Common stocks	$	24,836,032	$	16,392,210	$	48,983	$	41,179,259
Total	$	24,836,032	$	16,392,210	$	48,983	$	41,179,259
Short-term investments:
Money market funds and certificates of deposit	$	6,558,840	$	—	$	—	$	6,558,840
Total	$	6,558,840	$	—	$	—	$	6,558,840


	Available-for-Sale
(in thousands)	Amortized Cost		Estimated Fair Value
Due in one year or less	$	8,180	$	8,202
Due one year through five years	27,601		27,617
Due five years through ten years	18,216		18,306
Due after ten years	8,280		8,522
Total	$	62,277	$	62,647



Type of Investment	Balance Sheet Classification	Carrying Value		Estimated Fair Value		Maximum Potential Loss (a)
Tax credit LPs	Other investments	$	905,179	$	905,179	$	1,325,000
Real estate LLCs or LPs	Other investments	4,907,741		5,438,088		7,200,000
Small business investment LPs	Other investments	3,699,694		3,612,437		9,400,000
Total		$	9,512,614	$	9,955,704	$	17,925,000



Financial Statement Classification,	As of September 30, 2017		As of December 31, 2016
Consolidated Balance Sheets	As of September 30, 2017		As of December 31, 2016
Other investments	$	6,172,000	$	6,437,000
Premiums and fees receivable	$	809,000	$	56,000



Financial Statement Classification,	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
Consolidated Statements of Income	2017		2016		2017		2016
Net premiums written	$	3,705,000	$	4,513,000	$	11,036,000	$	10,993,000
Other income	$	642,000	$	809,000	$	1,689,000	$	1,541,000
Commissions to agents	$	2,501,000	$	3,062,000	$	7,457,000	$	7,465,000



Year Ended:
2017	$	208,989
2018	683,857
2019	610,524
2020	610,524
2021	603,191
Thereafter	4,690,009
Total	$	7,407,094



Three Months Ended September 30, 2017	Unrealized Gains and Losses On Available-for-Sale Securities			Postretirement Benefits Plans			Total
Beginning balance at July 1	$	13,774,631		$	(106,356	)	$	13,668,275
Other comprehensive income before reclassifications	1,235,517			—			1,235,517
Amounts reclassified from accumulated other comprehensive income	(529,519		)	1,421			(528,098		)
Net current-period other comprehensive income	705,998			1,421			707,419
Ending balance	$	14,480,629		$	(104,935	)	$	14,375,694



Three Months Ended September 30, 2017
Details about Accumulated Other Comprehensive Income Components	Amount Reclassified from Accumulated Other Comprehensive Income			Affected Line Item in the Consolidated Statements of Income
Unrealized gains and losses on available-for-sale securities:
Net realized gain on investments	$	803,938
Other-than-temporary impairments	—
Total	$	803,938		Net realized gain on investments
Tax	(274,419		)	Provision for Income Taxes
Net of Tax	$	529,519
Amortization related to postretirement benefit plans:
Prior year service cost	$	—
Unrecognized loss	(2,153		)
Total	$	(2,153	)	(a)
Tax	732			Provision for Income Taxes
Net of Tax	$	(1,421	)
Reclassifications for the period	$	528,098



	Issuer Purchases of Equity Securities
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan	Maximum Number of Shares that May Yet Be Purchased Under the Plan
Beginning of period					429,707
July 2017	—	$	—	—	429,707
August 2017	230	$	176.60	230	429,477
September 2017	—	$	—	—	429,477
Total:	230	$	176.60	230	429,477


	Issuer Purchases of Equity Securities (unrounded)
Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plan	Maximum Number of Shares that May Yet Be Purchased Under the Plan (1)
Beginning of period					420,216
January 1 through January 31, 2024	—	$	—	—	420,216
February 1 through February 29, 2024	—	—		—	420,216
March 1 through March 31, 2024	6,763	155.63		6,763	413,453
Total	6,763	$	155.63	6,763	413,453



31(i)	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

31(ii)		Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

32		~~Certification~~Certifications of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.INS		Inline XBRL Instance ~~Document~~Document*

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

104		Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101)

* - The instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document



INVESTORS TITLE COMPANY

	By:	/s/ James A. Fine, Jr.
		James A. Fine, Jr., President, Treasurer, Chief
		Financial Officer, Chief Accounting Officer and
		Director (Principal Financial Officer and
		Principal Accounting Officer)