Safety Insurance (SAFT) 10-Q 4 May 18 2018 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2018	May 02, 2018
Document and Entity Information
Entity Registrant Name	SAFETY INSURANCE GROUP INC
Entity Central Index Key	1,172,052
Document Type	10-Q
Document Period End Date	Mar. 31, 2018
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		15,286,891
Document Fiscal Year Focus	2,018
Document Fiscal Period Focus	Q1

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Investments:
Fixed maturities, available for sale, at fair value (amortized cost: $1,157,244 and $1,156,697)	$ 1,155,123	$ 1,172,026
Equity securities, at fair value (cost: $98,696 and $90,481)	116,601	111,867
Other invested assets	24,883	23,162
Total investments	1,296,607	1,307,055
Cash and cash equivalents	24,830	41,708
Accounts receivable, net of allowance for doubtful accounts	193,213	190,649
Receivable for securities sold	1,048	1,380
Accrued investment income	10,032	8,876
Taxes recoverable	2,568	908
Receivable from reinsurers related to paid loss and loss adjustment expenses	27,348	24,776
Receivable from reinsurers related to unpaid loss and loss adjustment expenses	87,067	83,085
Ceded unearned premiums	33,170	32,175
Deferred policy acquisition costs	71,217	72,202
Deferred income taxes	714
Equity and deposits in pools	28,660	28,246
Other assets	20,863	16,219
Total assets	1,797,337	1,807,279
Liabilities
Loss and loss adjustment expense reserves	579,774	574,054
Unearned premium reserves	427,231	428,257
Accounts payable and accrued liabilities	51,275	60,701
Payable for securities purchased	9,764	4,188
Payable to reinsurers	19,456	13,801
Deferred income taxes		2,917
Other liabilities	24,192	22,345
Total liabilities	1,111,692	1,106,263
Commitments and contingencies (Note 7)
Shareholders' equity
Common stock: $0.01 par value; 30,000,000 shares authorized; 17,566,461 and 17,499,544 shares issued	176	175
Additional paid-in capital	191,328	189,714
Accumulated other comprehensive (loss) income, net of taxes	(1,675)	24,269
Retained earnings	579,651	570,693
Treasury stock, at cost: 2,279,570 shares	(83,835)	(83,835)
Total shareholders' equity	685,645	701,016
Total liabilities and shareholders' equity	$ 1,797,337	$ 1,807,279

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Consolidated Balance Sheets
Fixed maturity securities, amortized cost	$ 1,157,244	$ 1,156,697
Equity securities, at cost	$ 98,696	$ 90,481
Common stock par value (in dollars per share)	$ 0.01	$ 0.01
Common stock shares authorized	30,000,000	30,000,000
Common stock shares issued	17,566,461	17,499,544
Treasury stock shares	2,279,570	2,279,570

Consolidated Statements of Oper

Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Revenues
Net earned premiums	$ 192,033	$ 189,711
Net investment income	10,531	9,095
Earnings from partnership investments	4,864	113
Net realized gains on investments	1,306	1,542
Change in net unrealized gains on equity investments	(3,482)
Finance and other service income	4,467	4,309
Total revenue	209,719	204,770
Expenses
Losses and loss adjustment expenses	137,644	128,430
Underwriting, operating and related expenses	60,856	59,670
Interest expense	22	22
Total expenses	198,522	188,122
Income before income taxes	11,197	16,648
Income tax expense	2,072	4,629
Net income	$ 9,125	$ 12,019
Earnings per weighted average common share:
Basic (in dollars per share)	$ 0.60	$ 0.80
Diluted (in dollars per share)	0.60	0.79
Cash dividends paid per common share (in dollars per share)	$ 0.80	$ 0.70
Number of shares used in computing earnings per share:
Basic (in shares)	15,045,962	14,980,005
Diluted (in shares)	15,191,139	15,096,728

Consolidated Statements of Comp

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Consolidated Statements of Comprehensive Income
Net income	$ 9,125	$ 12,019
Other comprehensive (loss) income, net of tax:
Unrealized holding (losses) gains during the period, net of income tax (benefit) expense of ($12,617) and $2,831.	(24,912)	5,257
Reclassification adjustment for net realized gains on investments included in net income, net of income tax expense of ($274) and ($540).	(1,032)	(1,002)
Other comprehensive (loss) income, net of tax	(25,944)	4,255
Comprehensive (loss) income	$ (16,819)	$ 16,274

Consolidated Statements of Com6

Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Consolidated Statements of Comprehensive Income.
Tax expense (benefit) on unrealized holding gains (losses) during the period	$ (12,617)	$ 2,831
Tax (expense) benefit on reclassification adjustment for (gains) losses included in net income	$ (274)	$ (540)

Consolidated Statements of Chan

Consolidated Statements of Changes in Shareholders' Equity - USD ($) $ in Thousands	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Income, Net of Taxes	Retained Earnings	Treasury Stock	Total
Balance at Dec. 31, 2016	$ 174	$ 184,549	$ 15,843	$ 553,995	$ (83,835)	$ 670,726
Net income				12,019		12,019
Unrealized gains (losses) on securities available for sale, net of deferred federal income taxes			4,255			4,255
Restricted share awards issued	1	294				295
Recognition of employee share-based compensation, net of deferred federal income taxes		1,228				1,228
Dividends paid and accrued				(10,674)		(10,674)
Balance at Mar. 31, 2017	175	186,071	20,098	555,340	(83,835)	677,849
Balance at Dec. 31, 2017	175	189,714	24,269	570,693	(83,835)	701,016
Cumulative effect of adoption of updated accounting guidance for equity financial instruments at January 1, 2018			(16,895)	16,895
Reclassification of certain tax effects from accumulated other comprehensive income at January 1, 2018			4,736	(4,736)
Net income				9,125		9,125
Unrealized gains (losses) on securities available for sale, net of deferred federal income taxes			(13,785)			(13,785)
Restricted share awards issued	1	375				376
Recognition of employee share-based compensation, net of deferred federal income taxes		1,239				1,239
Dividends paid and accrued				(12,326)		(12,326)
Balance at Mar. 31, 2018	$ 176	$ 191,328	$ (1,675)	$ 579,651	$ (83,835)	$ 685,645

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Cash flows from operating activities:
Net income	$ 9,125	$ 12,019
Adjustments to reconcile net income to net cash provided by operating activities:
Investment amortization, net	1,243	1,979
Fixed Asset depreciation, net	1,153	916
Stock based compensation	1,614	1,522
Provision for deferred income taxes	34	483
Net realized gains on investments	(1,306)	(1,542)
Earnings from partnership investments	(2,526)	(113)
Change in net unrealized gains on equity investments	3,482
Changes in assets and liabilities:
Accounts receivable	(2,564)	3,751
Accrued investment income	(1,156)	(701)
Receivable from reinsurers	(6,554)	(5,590)
Ceded unearned premiums	(995)	881
Deferred policy acquisition costs	985	428
Taxes recoverable	(1,660)
Other assets	(5,653)	(3,117)
Loss and loss adjustment expense reserves	5,720	9,228
Unearned premium reserves	(1,026)	278
Taxes payable		427
Accounts payable and accrued liabilities	(9,412)	(17,731)
Payable to reinsurers	5,655	(7,677)
Other liabilities	1,847	5,435
Net cash (used for) provided by operating activities	(1,994)	876
Cash flows from investing activities:
Fixed maturities purchased	(54,567)	(33,161)
Equity securities purchased	(12,664)	(7,963)
Other invested assets purchased	(129)	(2,973)
Proceeds from sales and paydowns of fixed maturities	35,247	47,535
Proceeds from maturities, redemptions, and calls of fixed maturities	23,272	10,490
Proceed from sales of equity securities	5,911	8,637
Proceeds from other invested assets redeemed	944	203
Fixed assets purchased	(558)	(758)
Net cash (used for) provided by investing activities	(2,544)	22,010
Cash flows from financing activities:
Dividends paid to shareholders	(12,340)	(10,697)
Net cash used for financing activities	(12,340)	(10,697)
Net (decrease) increase in cash and cash equivalents	(16,878)	12,189
Cash and cash equivalents at beginning of year	41,708	20,052
Cash and cash equivalents at end of period	$ 24,830	$ 32,241

Basis of Presentation

Basis of Presentation	3 Months Ended
	Mar. 31, 2018
Basis of Presentation
Basis of Presentation	1. Basis of Presentation The consolidated financial statements have been prepared on the basis of accounting principles generally accepted in the United States of America (“GAAP”). The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from these estimates. The consolidated financial statements include Safety Insurance Group, Inc. and its subsidiaries (the “Company”). The subsidiaries consist of Safety Insurance Company, Safety Indemnity Insurance Company, Safety Property and Casualty Insurance Company, Safety Asset Management Corporation (“SAMC”), and Safety Management Corporation, which is SAMC’s holding company. All intercompany transactions have been eliminated. The financial information for the three months ended March 31, 2018 and 2017 is unaudited; however, in the opinion of the Company, the information includes all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the financial condition, results of operations, and cash flows for the periods. The financial information as of December 31, 2017 is derived from the audited financial statements included in the Company's 2017 annual report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on February 28, 2018. These unaudited interim consolidated financial statements may not be indicative of financial results for the full year and should be read in conjunction with the audited financial statements included in the Company’s annual report on Form 10-K filed with the SEC on February 28, 2018. The Company is a leading provider of property and casualty insurance focused primarily on the Massachusetts market. The Company’s principal product line is automobile insurance. The Company operates through its insurance company subsidiaries, Safety Insurance Company, Safety Indemnity Insurance Company, and Safety Property and Casualty Insurance Company (together referred to as the “Insurance Subsidiaries”).

Recent Accounting Pronouncement

Recent Accounting Pronouncements	3 Months Ended
	Mar. 31, 2018
Recent Accounting Pronouncements
Recent Accounting Pronouncements	2. Recent Accounting Pronouncements In February 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-02, Income Statement – Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The ASU permits a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the newly enacted federal corporate income tax rate as a result of the 2017 Tax Cuts and Jobs Act (“TCJA”). The amount of the reclassification is the difference between the historical corporate income tax rate of thirty-five percent and the newly enacted twenty-one percent corporate income tax rate. The ASU is effective for fiscal years beginning after December 15, 2018. Early adoption is permitted. The Company adopted the updated guidance effective January 1, 2018 and elected to reclassify the income tax effects of the TCJA from accumulated other comprehensive income (“AOCI”) to retained earnings at the beginning of the period of adoption. This reclassification resulted in a decrease of $4,736 in retained earnings as of January 1, 2018 and an increase in AOCI by the same amount. In March 2017, the FASB issued ASU 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities , which requires certain premiums on callable debt securities to be amortized to the earliest call date. The amortization period for callable debt securities purchased at a discount will not be impacted. For public business entities with calendar year ends, the amendments in ASU No. 2017-08 are effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted, including adoption in an interim period. If early adopted in an interim period, any adjustments should be reflected as of the beginning of the fiscal year that includes the interim period. The Company is evaluating the impact of ASU 2017-08 on its financial position and results of operations. The extent of the impact will depend upon the nature and characteristics of the Company’s portfolio at the adoption date. In December 2016, the FASB issued ASU 2016-19 - Technical Corrections and Improvements , which covers a wide range of Topics in the Accounting Standards Codification (ASC). The amendments in this Update represent changes to clarify, correct errors, or make minor improvements to the ASC, making it easier to understand and apply by eliminating inconsistencies and providing clarifications. The amendments generally fall into one of the following categories: amendments related to differences between original guidance and the ASC, guidance clarification and reference corrections, simplification, or minor improvements. Most of the amendments in ASU 2016-19 do not require transition guidance and are effective upon issuance of ASU 2016-19. The impact of the adoption of ASU 2016-19 was not material to the Company’s financial position, results of operations, cash flows or disclosures. In August 2016, the FASB issued ASU 2016-15 , Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. ASU 2016-15 reduces diversity in practice in how certain transactions are classified in the statement of cash flows. The amendments in ASU 2016-15 provide guidance on specific cash flow issues including debt prepayment or debt extinguishment costs, settlement of zero-coupon debt instruments or other debt instruments with coupon interest rates that are insignificant in relation to the effective interest rate of the borrowing, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, proceeds from the settlement of corporate-owned life insurance policies, and distributions received from equity method investees. ASU 2016-15 is effective for annual and interim periods beginning after December 15, 2017. The impact of the adoption of ASU 2016-15 was not material to the Company’s Consolidated Statements of Cash Flows. In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Statements , which amends the guidance for the impairment of financial instruments and is expected to result in more timely recognition of impairment losses. The update introduces an impairment model referred to as the current expected credit loss (“CECL”) model. The impairment model is based on expected losses rather than incurred losses. Under the new guidance, an entity recognizes as an allowance its estimate of expected credit losses. The ASU is also intended to reduce the complexity of the current guidance by decreasing the number of credit impairment models that entities use to account for debt instruments. For public business entities that are SEC filers, the amendments in ASU No. 2016-13 are effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. Entities may adopt the amendments in this update earlier as of the fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company is evaluating the impact of ASU 2016-13 on its financial position and results of operations with regards to potential credit losses on its Available For Sale investment portfolio. The extent of the increase of credit losses will depend upon the nature and characteristics of the Company’s portfolio at the adoption date, and the macroeconomic conditions and forecasts at the date. In March 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting . This ASC update requires all excess tax benefits and tax deficiencies to be recognized as income tax expense or benefit in the income statement, and be treated as discrete items in the reporting period in which they occur. Additionally, excess tax benefits will be classified with other income tax cash flows as an operating activity and cash paid by an employer when directly withholding shares for tax withholding purposes will be classified as a financing activity. Awards that are used to settle employee tax liabilities will be allowed to qualify for equity classification for withholdings up to the maximum statutory tax rates in applicable jurisdictions. Regarding forfeitures, a company can make an entity-wide accounting policy election to either continue estimating the number of awards that are expected to vest or account for forfeitures when they occur. The updated guidance is effective for annual periods beginning after December 15, 2016 and interim periods within those annual periods. The impact of the adoption of ASU 2016-09 was not material to the Company’s financial position, results of operations or cash flows. In February 2016, the FASB issued ASU 2016-02, Leases . ASU 2016-02 establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Company is currently evaluating the impact of ASU 2016-02 by reviewing its existing lease contracts. The Company expects a gross-up of its Consolidated Balance Sheets as a result of recognizing lease liabilities and right of use assets. The extent of such gross-up is under evaluation. The Company does not expect material changes to the Consolidated Statements of Operations. In January 2016, the FASB issued ASU 2016-01, Financial Instruments-Overall (Subtopic 825-10), Recognition and Measurement of Financial Assets and Financial Liabilities . The amendments in this ASC update address certain aspects of recognition, measurement, presentation and disclosure of financial instruments. ASU 2016-01: (1) requires equity investments (except those accounted for under the equity method or those that result in the consolidation of the investee) to be measured at fair value with changes in the fair value recognized in net income; (2) simplifies the impairment assessment of equity investments without readily determinable fair values by requiring a qualitative assessment to identify impairment; (3) requires the use of the exit price notion when measuring the fair value of financial instruments for disclosure purposes; and (4) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the notes to the financial statements. These amendments are effective for fiscal years beginning after December 15, 2017, including interim periods within those fiscal years. The Company adopted the updated guidance effective January 1, 2018 which resulted in the recognition of $16,895 of net after-tax unrealized gains on equity investments as a cumulative effect adjustment that increased retained earnings as of January 1, 2018 and decreased AOCI by the same amount. At December 31, 2017, equity investments were classified as available-for-sale on the Company’s Consolidated Balance Sheets, however, upon adoption, the updated guidance eliminated the available-for-sale balance sheet classification for equity investments. In August 2014, the FASB issued ASU 2014-15, Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosures of Uncertainties about an Entity’s Ability as a Going Concern. ASU 2014-15 provides guidance on determining when and how to disclose going concern uncertainties in the financial statements, and requires management to perform interim and annual assessments of an entity’s ability to continue as a going concern within one year of the date the financial statements are issued. ASU 2014-15 is effective for annual periods ending after December 15, 2016 and interim periods thereafter. Management has assessed and concluded that there were no conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date the financial statements were issued. In May 2014, the FASB issued as final, ASU 2014-09, Revenue from Contracts with Customers (Topic 606) , which supersedes virtually all existing revenue recognition guidance under GAAP. The update's core principle is that an entity should 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. The update is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017 and allows early adoption. ASU 2014-09 allows for the use of either the retrospective or modified retrospective approach of adoption. The Company adopted the updated guidance effective January 1, 2018 using the modified retrospective approach. The adoption of ASU 2014-09 did not have a material impact on the Company’s financial position, results of operations, cash flows, or disclosures.

Earnings per Weighted Average C

Earnings per Weighted Average Common Share	3 Months Ended
	Mar. 31, 2018
Earnings per Weighted Average Common Share
Earnings per Weighted Average Common Share.	3. Earnings per Weighted Average Common Share Basic earnings per weighted average common share (“EPS”) are calculated by dividing net income by the weighted average number of basic common shares outstanding during the period. Diluted earnings per share amounts are based on the weighted average number of common shares including non-vested performance stock grants and the net effect of potentially dilutive common stock options. The following table sets forth the computation of basic and diluted EPS for the periods indicated. Three Months Ended March 31, 2018 2017 Earnings attributable to common shareholders - basic and diluted: Net income from continuing operations $ 9,125 $ 12,019 Allocation of income for participating shares (56) (79) Net income from continuing operations attributed to common shareholders $ 9,069 $ 11,940 Earnings per share denominator - basic and diluted Total weighted average common shares outstanding, including participating shares 15,139,036 15,079,684 Less: weighted average participating shares (93,074) (99,679) Basic earnings per share denominator 15,045,962 14,980,005 Common equivalent shares- stock options — — Common equivalent shares- non-vested performance stock grants 145,177 116,723 Diluted earnings per share denominator 15,191,139 15,096,728 Basic earnings per share $ 0.60 $ 0.80 Diluted earnings per share $ 0.60 $ 0.79 Undistributed earnings attributable to common shareholders - basic and diluted: Net income from continuing operations attributable to common shareholders -Basic $ 0.60 $ 0.80 Dividends declared (0.80) (0.70) Undistributed earnings $ (0.20) $ 0.10 Net income from continuing operations attributable to common shareholders -Diluted $ 0.60 $ 0.79 Dividends declared (0.80) (0.70) Undistributed earnings $ (0.20) $ 0.09

Share-Based Compensation

Share-Based Compensation	3 Months Ended
	Mar. 31, 2018
Share-Based Compensation
Share-Based Compensation	4. Share-Based Compensation Management Omnibus Incentive Plan Long-term incentive compensation is provided under the Company’s 2002 Management Omnibus Incentive Plan (“the Incentive Plan”) which provides for a variety of share-based compensation awards, including nonqualified stock options, incentive stock options, stock appreciation rights and restricted stock (“RS”) awards. The maximum number of shares of common stock with respect to which awards may be granted is 2,500,000. The Incentive Plan was amended in March of 2013 to remove "share recycling" plan provisions. Hence, shares of stock covered by an award under the Incentive Plan that are forfeited are no longer available for issuance in connection with 2013 and future grants of awards. At March 31, 2018, there were 137,968 shares available for future grant. The Board of Directors and the Compensation Committee intend to issue more awards under the Incentive Plan in the future. On April 2, 2018, our Board of Directors adopted the Safety Insurance Group, Inc. 2018 Long-Term Incentive Plan (“the 2018 Plan”), subject to shareholder approval. We have requested that the Company’s shareholders approve the 2018 Plan at the 2018 Annual Meeting of Shareholders, which will make 350,000 shares of common stock available for issuance to our employees and other eligible participants. The Company will not grant any awards under the 2018 Plan before approval by the shareholders of the Company. Accounting and Reporting for Stock-Based Awards Accounting Standards Codification (“ASC”) 718, Compensation —Stock Compensation requires the Company to measure and recognize the cost of employee services received in exchange for an award of equity instruments. Under the provisions of ASC 718, share-based compensation cost is measured at the grant date, based on the fair value of the award, and is recognized as an expense over the requisite service period (generally the vesting period of the equity grant). Restricted Stock Service-based restricted stock awarded in the form of unvested shares is recorded at the market value of the Company’s common stock on the grant date and amortized ratably as compensation expense over the requisite service period. Service-based restricted stock awards generally vest over a three-year period and vest 30% on the first and second anniversaries of the grant date and 40% on the third anniversary of the grant date, except for non-executive employees’ restricted stock awards granted prior to 2018 which vest ratably over a five-year service period and independent directors’ stock awards which vest immediately. Our independent directors are subject to stock ownership guidelines, which require them to have a value four times their annual cash retainer. In addition to service-based awards, the Company grants performance-based restricted shares to certain employees. These performance shares cliff vest after a three-year performance period provided certain performance measures are attained. A portion of these awards, which contain a market condition, vest according to the level of total shareholder return achieved by the Company compared to its property-casualty insurance peers over a three-year period. The remainder, which contain a performance condition, vest according to the level of Company’s combined ratio results compared to a target based on its property-casualty insurance peers. Actual payouts can range from 0% to 200% of target shares awarded depending upon the level of achievement of the respective market and performance conditions during a three calendar-year performance period. Compensation expense for share awards with a performance condition is based on the probable number of awards expected to vest using the performance level most likely to be achieved at the end of the performance period. Performance-based awards with market conditions are accounted for and measured differently from awards that have a performance or service condition. The effect of a market condition is reflected in the award’s fair value on the grant date. That fair value is recognized as compensation cost over the requisite service period regardless of whether the market-based performance objective has been satisfied. All of the Company’s restricted stock awards are issued as incentive compensation and are equity classified. The following table summarizes restricted stock activity under the Incentive Plan during the three months ended March 31, 2018 assuming a target payout for the 2018 performance-based shares. Shares Weighted Performance-based Weighted Under Average Shares Under Average Restriction Fair Value Restriction Fair Value Outstanding at beginning of year 93,086 $ 63.13 105,660 $ 62.75 Granted 39,451 75.05 31,668 72.21 Vested and unrestricted (42,204) 62.36 (27,003) 61.48 Forfeited — — (4,202) 61.48 Outstanding at end of period 90,333 $ 68.67 106,123 $ 66.79

Investments

Investments	3 Months Ended
	Mar. 31, 2018
Investments
Investments	5. Investments The gross unrealized gains and losses on investments in fixed maturity securities, including redeemable preferred stocks that have characteristics of fixed maturities, and equity securities, including interests in mutual funds, and other invested assets were as follows for the periods indicated. As of March 31, 2018 Gross Unrealized Losses (3) Cost or Gross Non-OTTI OTTI Estimated Amortized Unrealized Unrealized Unrealized Fair Cost Gains Losses Losses (4) Value U.S. Treasury securities $ 1,808 $ — $ (39) $ — $ 1,769 Obligations of states and political subdivisions 385,669 8,280 (2,741) — 391,208 Residential mortgage-backed securities (1) 244,037 1,625 (5,796) — 239,866 Commercial mortgage-backed securities 39,248 42 (840) — 38,450 Other asset-backed securities 61,945 260 (396) — 61,809 Corporate and other securities 424,537 3,971 (6,487) — 422,021 Subtotal, fixed maturity securities 1,157,244 14,178 (16,299) — 1,155,123 Equity securities (2) 98,696 19,369 (1,464) — 116,601 Other invested assets (5) 24,883 — — — 24,883 Totals $ 1,280,823 $ 33,547 $ (17,763) $ — $ 1,296,607 As of December 31, 2017 Gross Unrealized Losses (3) Cost or Gross Non-OTTI OTTI Estimated Amortized Unrealized Unrealized Unrealized Fair Cost Gains Losses Losses (4) Value U.S. Treasury securities $ 1,809 $ — $ (18) $ — $ 1,791 Obligations of states and political subdivisions 391,806 12,244 (966) — 403,084 Residential mortgage-backed securities (1) 223,257 2,352 (2,843) — 222,766 Commercial mortgage-backed securities 39,268 415 (314) — 39,369 Other asset-backed securities 72,665 173 (225) — 72,613 Corporate and other securities 427,892 6,962 (2,451) — 432,403 Subtotal, fixed maturity securities 1,156,697 22,146 (6,817) — 1,172,026 Equity securities (2) 90,481 21,995 (609) — 111,867 Other invested assets (5) 23,162 — — — 23,162 Totals $ 1,270,340 $ 44,141 $ (7,426) $ — $ 1,307,055 (1) Residential mortgage-backed securities consists primarily of obligations of U.S. Government agencies including collateralized mortgage obligations issued, guaranteed and/or insured by the following issuers: Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA) and the Federal Home Loan Bank (FHLB). (2) Equity securities included interests in mutual funds held to fund the Company’s executive deferred compensation plan. (3) Our investment portfolio included 600 and 367 securities in an unrealized loss position at March 31, 2018 and December 31, 2017, respectively. (4) Amounts in this column represent other-than-temporary impairment (“OTTI”) recognized in accumulated other comprehensive income. (5) Other invested assets are accounted for under the equity method which approximated fair value. The amortized cost and the estimated fair value of fixed maturity securities, by maturity, are shown below for the period indicated. Expected maturities will differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. As of March 31, 2018 Amortized Estimated Cost Fair Value Due in one year or less $ 49,054 $ 49,035 Due after one year through five years 289,999 292,493 Due after five years through ten years 260,296 259,596 Due after ten years through twenty years 207,835 208,966 Due after twenty years 4,829 4,908 Asset-backed securities 345,231 340,125 Totals $ 1,157,244 $ 1,155,123 The gross realized gains and losses on sales of investments were as follows for the periods indicated. Three Months Ended March 31, 2018 2017 Gross realized gains Fixed maturity securities $ 135 $ 573 Equity securities 1,644 1,115 Gross realized losses Fixed maturity securities (84) (108) Equity securities (389) (38) Net realized gains on investments $ 1,306 $ 1,542 In the normal course of business, the Company enters into transactions involving various types of financial instruments, including investments in fixed maturities and equity securities. Investment transactions have credit exposure to the extent that a counter party may default on an obligation to the Company. Credit risk is a consequence of carrying, trading and investing in securities. To manage credit risk, the Company focuses on higher quality fixed income securities, reviews the credit strength of all companies in which it invests, limits its exposure in any one investment and monitors the portfolio quality, taking into account credit ratings assigned by recognized statistical rating organizations. The following tables as of March 31, 2018 and December 31, 2017 present the gross unrealized losses included in the Company’s investment portfolio and the fair value of those securities aggregated by investment category. The tables also present the length of time that they have been in a continuous unrealized loss position. As of March 31, 2018 Less than 12 Months 12 Months or More Total Estimated Unrealized Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses Fair Value Losses U.S. Treasury securities $ 1,769 $ 39 $ — $ — $ 1,769 $ 39 Obligations of states and political subdivisions 87,643 1,197 29,173 1,544 116,816 2,741 Residential mortgage-backed securities 165,938 4,120 37,321 1,676 203,259 5,796 Commercial mortgage-backed securities 26,383 341 7,802 499 34,185 840 Other asset-backed securities 30,429 323 7,984 73 38,413 396 Corporate and other securities 190,789 4,439 36,922 2,048 227,711 6,487 Subtotal, fixed maturity securities 502,951 10,459 119,202 5,840 622,153 16,299 Equity securities 16,881 1,054 2,220 410 19,101 1,464 Total temporarily impaired securities $ 519,832 $ 11,513 $ 121,422 $ 6,250 $ 641,254 $ 17,763 As of December 31, 2017 Less than 12 Months 12 Months or More Total Estimated Unrealized Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses Fair Value Losses U.S. Treasury securities $ 1,791 $ 18 $ — $ — $ 1,791 $ 18 Obligations of states and political subdivisions 19,603 152 30,018 814 49,621 966 Residential mortgage-backed securities 126,713 1,724 39,638 1,119 166,351 2,843 Commercial mortgage-backed securities 5,457 30 8,027 284 13,484 314 Other asset-backed securities 25,769 167 18,270 58 44,039 225 Corporate and other securities 94,863 1,189 36,440 1,262 131,303 2,451 Subtotal, fixed maturity securities 274,196 3,280 132,393 3,537 406,589 6,817 Equity securities 4,730 361 2,420 248 7,150 609 Total temporarily impaired securities $ 278,926 $ 3,641 $ 134,813 $ 3,785 $ 413,739 $ 7,426 Other-Than-Temporary Impairments ASC 320, Investments – Debt and Equity Securities requires entities to separate an OTTI of a debt security into two components when there are credit related losses associated with the impaired debt security for which the Company asserts that it does not have the intent to sell the security, and it is more likely than not that it will not be required to sell the security before recovery of its cost basis. Under ASC 320, the amount of the OTTI related to a credit loss is recognized in earnings, and the amount of the OTTI related to other factors is recorded as a component of other comprehensive income. In instances where no credit loss exists but it is more likely than not that the Company will have to sell the debt security prior to the anticipated recovery, the decline in market value below amortized cost is recognized as an OTTI in earnings. In periods after the recognition of an OTTI on debt securities, the Company accounts for such securities as if they had been purchased on the measurement date of the OTTI at an amortized cost basis equal to the previous amortized cost basis less the OTTI recognized in earnings. For debt securities for which OTTI was recognized in earnings, the difference between the new amortized cost basis and the cash flows expected to be collected will be accreted or amortized into net investment income. The Company holds no subprime mortgage debt securities. All of the Company’s holdings in mortgage-backed securities are either U.S. Government or Agency guaranteed or are rated investment grade by either Moody’s or Standard & Poor’s. The unrealized losses in the Company’s fixed income and equity portfolio as of March 31, 2018 were reviewed for potential other-than-temporary asset impairments. As a result of the analysis, the Company recognized no OTTI losses during the three months ended March 31, 2018 and March 31, 2017. Specific qualitative analysis was also performed for any additional securities appearing on the Company’s “Watch List”. Qualitative analysis considered such factors as the financial condition and the near term prospects of the issuer, whether the debtor is current on its contractually obligated interest and principal payments, changes to the rating of the security by a rating agency and the historical volatility of the fair value of the security. The qualitative analysis performed by the Company concluded that outside of the securities that were recognized through OTTI, the unrealized losses recorded on the investment portfolio at March 31, 2018 resulted from fluctuations in market interest rates and other temporary market conditions as opposed to fundamental changes in the credit quality of the issuers of such securities. Therefore, decreases in fair values of the Company’s securities are viewed as being temporary. The following table summarizes the credit loss recognized in earnings related to fixed maturity securities. Three Months Ended March 31, 2018 2017 Credit losses on fixed maturity securities, beginning of period $ 892 $ 1,094 Add: credit losses on OTTI not previously recognized — — Less: credit losses on securities sold (276) (106) Less: credit losses on securities impaired due to intent to sell — — Add: credit losses on previously impaired securities — — Less: increases in cash flows expected on previously impaired securities — — Credit losses on fixed maturity securities, end of period $ 616 $ 988 At March 31, 2018 and December 31, 2017, there were no amounts included in accumulated other comprehensive income related to securities which were considered by the Company to be other-than-temporarily impaired. Based upon the qualitative analysis performed, the Company’s decision to hold these securities, the Company’s current level of liquidity and our history of positive operating cash flows, management believes it is more likely than not that it will not be required to sell any of its securities before the anticipated recovery in the fair value to its amortized cost basis. Net Investment Income The components of net investment income were as follows: Three Months Ended March 31, 2018 2017 Interest on fixed maturity securities $ 10,109 $ 8,834 Dividends on equity securities 785 660 Equity in earnings of other invested assets 341 237 Interest on other assets 22 22 Interest on cash and cash equivalents — — Total investment income 11,257 9,753 Investment expenses 726 658 Net investment income $ 10,531 $ 9,095 Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosure provides a revised definition of fair value, establishes a framework for measuring fair value and expands financial statement disclosure requirements for fair value information. Under ASC 820, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants (an exit price). ASC 820 establishes a fair value hierarchy that distinguishes between inputs based on market data from independent sources (“observable inputs”) and a reporting entity’s internal assumptions based upon the best information available when external market data is limited or unavailable (“unobservable inputs”). The fair value hierarchy in ASC 820 prioritizes fair value measurements into three levels based on the nature of the inputs as follows: Level 1 — Valuations based on quoted prices in active markets for identical assets and liabilities; Level 2 — Valuations based on observable inputs that do not meet the criteria for Level 1, including quoted prices in inactive markets and quoted prices in active markets for similar, but not identical instruments; and Level 3 — Valuations based on unobservable inputs. Fair values for the Company’s fixed maturity securities are based on prices provided by its custodian bank and its investment managers. Both the Company’s custodian bank and investment managers use a variety of independent, nationally recognized pricing services to determine market valuations. If the pricing service cannot provide fair value determinations, the Company obtains non-binding price quotes from broker-dealers. A minimum of two quoted prices is obtained for the majority of the Company’s available-for-sale fixed maturity securities in its investment portfolio. The Company uses a third-party pricing service as its primary provider of quoted prices from third-party pricing services and broker-dealers. To provide reasonable assurance of the validity of each price or quote, a secondary third-party pricing service or broker-dealer quote is obtained from the Company’s custodian or investment managers. An examination of the pricing data is then performed for each security. If the variance between the primary and secondary price quotes for a security is within an accepted tolerance level, the quoted price obtained from the Company’s primary source is used for the security. If the variance between the primary and secondary price quotes exceeds an accepted tolerance level, the Company obtains a quote from an alternative source, if possible, and documents and resolves any differences between the pricing sources. In addition, the Company may request that its investment managers and its traders provide input as to which vendor is providing prices that its traders believe are reflective of fair value for the security. Following this process, the Company may decide to value the security in its financial statements using the secondary or alternative source if it believes that pricing is more reflective of the security’s value than the primary pricing provided by its custodian bank. The Company analyzes market valuations received to verify reasonableness, to understand the key assumptions used and their sources, and to determine an appropriate ASC 820 fair value hierarchy level based upon trading activity and the observability of market inputs. Based on this evaluation and investment class analysis, each price is classified into Level 1, 2 or 3. Fair values of instruments are based on (i) quoted prices in active markets for identical assets (Level 1), (ii) quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations in which all significant inputs are observable in active markets (Level 2) or (iii) valuations derived from valuation techniques in which one or more significant inputs are unobservable in the marketplace (Level 3). The Company’s Level 1 securities consist of equity securities whose values are based on quoted prices in active markets for identical assets. The Company’s Level 2 securities are comprised of available-for-sale fixed maturity securities whose fair value was determined using observable market inputs. The Company’s Level 3 security consists of an investment in the Federal Home Loan Bank of Boston related to Safety Insurance Company’s membership stock, which is not redeemable in a short-term time frame. Fair values for securities for which quoted market prices were unavailable were estimated based upon reference to observable inputs such as benchmark interest rates, market comparables, and other relevant inputs. Investments valued using these inputs include U.S. Treasury securities, obligations of states and political subdivisions, corporate and other securities, commercial and residential mortgage-backed securities, and other asset-backed securities. Inputs into the fair value application that are utilized by asset class include but are not limited to: · Obligations of states and political subdivisions : overall credit quality, including assessments of market sectors and the level and variability of sources of payment such as general obligation, revenue or lease; credit support such as insurance, state or local economic and political base, prefunded and escrowed to maturity covenants. · Corporate and other securities : overall credit quality, the establishment of a risk adjusted credit spread over the applicable risk-free yield curve for discounted cash flow valuations; assessments of the level of industry economic sensitivity, company financial policies, indenture restrictive covenants, and/or security and collateral. · Residential mortgage-backed securities , U.S. agency pass-throughs, collateralized mortgage obligations (“CMOs”), non U.S. agency CMOs : estimates of prepayment speeds based upon historical prepayment rate trends, underlying collateral interest rates, original weighted average maturity, vintage year, borrower credit quality characteristics, interest rate and yield curve forecasts, U.S. government support programs, tax policies, and delinquency/default trends. · Commercial mortgage-backed securities : overall credit quality, including assessments of the level and variability of credit support and collateral type such as office, retail, or lodging, predictability of cash flows for the deal structure, prevailing economic market conditions. · Other asset-backed securities : overall credit quality, estimates of prepayment speeds based upon historical trends and characteristics of underlying loans, including assessments of the level and variability of collateral, revenue generating agreements, area licenses agreements, product sourcing agreements and equipment and property leases. · Federal Home Loan Bank of Boston (“FHLB-Boston”): value is equal to the cost of the member stock purchased. In order to ensure the fair value determination is representative of an exit price (consistent with ASC 820), the Company’s procedures for validating quotes or prices obtained from third parties include, but are not limited to, obtaining a minimum of two price quotes for each fixed maturity security if possible, as discussed above, the periodic testing of sales activity to determine if there are any significant differences between the market price used to value the security as of the balance sheet date and the sales price of the security for sales that occurred around the balance sheet date, and the periodic review of reports provided by its external investment manager regarding those securities with ratings changes and securities placed on its “Watch List.” In addition, valuation techniques utilized by pricing services and prices obtained from external sources are reviewed by the Company’s external investment manager, whose investment professionals are familiar with the securities being priced and the markets in which they trade, to ensure the fair value determination is representative of an exit price (consistent with ASC 820). All unadjusted estimates of fair value for our fixed maturities priced by the pricing services as described above are included in the amounts disclosed in Level 2. With the exception of the FHLB-Boston security, which is categorized as a Level 3 security, the Company’s entire portfolio was priced based upon quoted market prices or other observable inputs as of March 31, 2018. There were no significant changes to the valuation process during the three months ended March 31, 2018. As of March 31, 2018 and December 31, 2017, no quotes or prices obtained were adjusted by management. All broker quotes obtained were non-binding. At March 31, 2018 and December 31, 2017, investments in fixed maturities classified as available-for-sale had a fair value which equaled carrying value $1,155,123 and $1,172,026, respectively. We have no short-term investments. The carrying values of cash and cash equivalents and investment income accrued approximated fair value. The following tables summarize the Company’s total fair value measurements for investments for the periods indicated. As of March 31, 2018 Total Level 1 Inputs Level 2 Inputs Level 3 Inputs U.S. Treasury securities $ 1,769 $ — $ 1,769 $ — Obligations of states and political subdivisions 391,208 — 391,208 — Residential mortgage-backed securities 239,866 — 239,866 — Commercial mortgage-backed securities 38,450 — 38,450 — Other asset-backed securities 61,809 — 61,809 — Corporate and other securities 422,021 — 422,021 — Equity securities 88,097 87,417 — 680 Total investment securities $ 1,243,220 $ 87,417 $ 1,155,123 $ 680 As of December 31, 2017 Total Level 1 Inputs Level 2 Inputs Level 3 Inputs U.S. Treasury securities $ 1,791 $ — $ 1,791 $ — Obligations of states and political subdivisions 403,084 — 403,084 — Residential mortgage-backed securities 222,766 — 222,766 — Commercial mortgage-backed securities 39,369 — 39,369 — Other asset-backed securities 72,613 — 72,613 — Corporate and other securities 432,403 — 432,403 — Equity securities 87,737 87,057 — 680 Total investment securities $ 1,259,763 $ 87,057 $ 1,172,026 $ 680 There were no transfers between Level 1 and Level 2 during the three months ended March 31, 2018 and 2017. The following table summarizes the changes in the Company’s Level 3 fair value securities for the periods indicated. Three Months Ended March 31, 2018 2017 Level 3 Level 3 Fair Value Fair Value Securities Securities Balance at beginning of period $ 680 678 Net gains and losses included in earnings — — Net gains included in other comprehensive income — — Purchases — — Sales — — Transfers into Level 3 — — Transfers out of Level 3 — — Balance at end of period $ 680 $ 678 Amount of total losses included in earnings attributable to the change in unrealized losses related to assets still held at end of period $ — $ — Transfers in and out of Level 3 are attributable to changes in the ability to observe significant inputs in determining fair value exit pricing. As noted in the table above, no transfers were made in or out of Level 3 during the three months ended March 31, 2018 and 2017. The Company held one Level 3 security at March 31, 2018 and March 31, 2017. As of March 31, 2018 and December 31, 2017, there were approximately $28,504 and $24,130, respectively, in a real estate investment trust (“REIT”). The REIT is excluded from the fair value hierarchy because the fair value is recorded using the net asset value per share practical expedient. The net asset value per share of this REIT is derived from member ownership in the capital venture to which a proportionate share of independently appraised net assets is attributed. The fair value was determined using the trust’s net asset value obtained from its audited financial statements. The Company is required to submit a request 45 days before a quarter end to dispose of the security.

Loss and Loss Adjustment Expens

Loss and Loss Adjustment Expense Reserves	3 Months Ended
	Mar. 31, 2018
Loss and Loss Adjustment Expense Reserves
Loss and Loss Adjustment Expense Reserves	6. Loss and Loss Adjustment Expense Reserves The following table sets forth a reconciliation of beginning and ending reserves for losses and loss adjustment expenses (“LAE”), as shown in the Company’s consolidated financial statements for the periods indicated. Three Months Ended March 31, 2018 2017 Reserves for losses and LAE at beginning of year $ 574,054 $ 560,321 Less receivable from reinsurers related to unpaid losses and LAE (83,085) (83,724) Net reserves for losses and LAE at beginning of year 490,969 476,597 Incurred losses and LAE, related to: Current year 151,795 138,862 Prior years (14,151) (10,432) Total incurred losses and LAE 137,644 128,430 Paid losses and LAE related to: Current year 83,396 82,589 Prior years 52,510 40,135 Total paid losses and LAE 135,906 122,724 Net reserves for losses and LAE at end of period 492,707 482,303 Plus receivable from reinsurers related to unpaid losses and LAE 87,067 87,246 Reserves for losses and LAE at end of period $ 579,774 $ 569,549 At the end of each period, the reserves were re-estimated for all prior accident years. The Company’s prior year reserves decreased by $14,151 and $10,432 for the three months ended March 31, 2018 and 2017, respectively, and resulted from re-estimations of prior years ultimate loss and LAE liabilities. The decreases in prior years reserves during the three months ended March 31, 2018 and 2017 are primarily composed of reductions in our retained automobile, retained homeowners and retained other lines reserves. The Company's automobile lines of business reserves decreased for the three months ended March 31, 2018 and 2017, primarily due to fewer incurred but not yet reported claims than previously estimated and better than previously estimated severity on the Company’s established bodily injury and property damage case reserves. Due to the nature of the risks that the Company underwrites and has historically underwritten, management does not believe that it has an exposure to asbestos or environmental pollution liabilities.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2018
Commitments and Contingencies
Commitments and Contingencies	7. Commitments and Contingencies On December 15, 2015, the Company filed for arbitration with a reinsurer in regards to the reinsurance recoverable resulting from the 2015 winter storm losses that are admissible under our contract. The total amount of recoverable in dispute, which was based on our total incurred loss, was $20,918 at December 31, 2017. On January 8, 2018 the Company received a final order from a panel of arbitrators in which the reinsurer would pay the Company $9,200 for settlement of all paid and outstanding losses. This amount has since been collected. The remaining unrecovered amount of $11,718 was expensed in 2017. Various claims, generally incidental to the conduct of normal business, are pending or alleged against the Company from time to time. In the opinion of management, based in part on the advice of legal counsel, the ultimate resolution of such claims will not have a material adverse effect on the Company’s consolidated financial statements. However, if estimates of the ultimate resolutions of those proceedings are revised, liabilities related to those proceedings could be adjusted in the near term.

Debt

Debt	3 Months Ended
	Mar. 31, 2018
Debt
Debt	8. Debt The Company has a Revolving Credit Agreement (the “Credit Agreement”) with Citizens Bank, N.A. (formerly known as RBS Citizens, N.A. (“Citizens Bank”). The Credit Agreement provides a $30,000 revolving credit facility with an accordion feature allowing for future expansion of the committed amount up to $50,000. Loans under the credit facility bear interest at the Company’s option at either (i) the LIBOR rate plus 1.25% per annum or (ii) the higher of Citizens Bank prime rate or 0.5% above the federal funds rate plus 1.25% per annum. Interest only is payable prior to maturity. The Credit Agreement has a maturity date of August 14, 2018. The Company’s obligations under the credit facility are secured by pledges of its assets and the capital stock of its operating subsidiaries. The credit facility is guaranteed by the Company’s non-insurance company subsidiaries. The credit facility contains covenants including requirements to maintain minimum risk-based capital ratios and statutory surplus of Safety Insurance Company as well as limitations or restrictions on indebtedness, liens, and other matters. As of March 31, 2018, the Company was in compliance with all covenants. In addition, the credit facility includes customary events of default, including a cross-default provision permitting the lenders to accelerate the facility if the Company (i) defaults in any payment obligation under debt having a principal amount in excess of $10,000 or (ii) fails to perform any other covenant permitting acceleration of all such debt. The Company had no amounts outstanding on its credit facility at March 31, 2018 and December 31, 2017. The credit facility commitment fee included in interest expense was computed at a rate of 0.25% per annum on the $30,000 commitment at March 31, 2018 and 2017.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2018
Income Taxes
Income Taxes	9. Income Taxes Federal income tax expense for the three months ended March 31, 2018 and 2017 has been computed using estimated effective tax rates. These rates are revised, if necessary, at the end of each successive interim period to reflect the current estimates of the annual effective tax rates. The effective rate in 2018 was lower than the statutory rate primarily due to effects of tax-exempt investment income. The Company believes that the positions taken on its income tax returns for open tax years will be sustained upon examination by the Internal Revenue Service (“IRS”). Therefore, the Company has not recorded any liability for uncertain tax positions under ASC 740, Income Taxes . During the three months ended March 31, 2018, there were no material changes to the amount of the Company’s unrecognized tax benefits or to any assumptions regarding the amount of its ASC 740 liability. In the Company’s opinion, adequate tax liabilities have been established for all open years. However, the amount of these tax liabilities could be revised in the near term if estimates of the Company’s ultimate liability are revised. On December 22, 2017, the TCJA was enacted, which significantly amends the Internal Revenue Code of 1986. The TCJA, among other things, reduces the corporate tax rate from a statutory rate of 35% to 21%, imposes additional limitations on net operating losses and executive compensation, allows for the full expensing of certain capital expenditures and enacts other changes impacting the insurance industry. The March 31, 2018 and December 31, 2017 net deferred tax liability have been measured at the 21% tax rate. The TCJA modified the provisions applicable to the determination of the tax basis of unpaid loss reserves. These modifications impact the payment pattern and applicable interest rate. The TCJA instructed the Treasury to provide discount factors and other guidance necessary to determine the necessary transition adjustment. This information has not been released; accordingly, we have applied the law existing prior to the enactment of the TCJA. These provisions had no effect on the Company’s net deferred tax liability or the total tax expense. SEC Staff Accounting Bulletin No. 118, Income Tax Accounting Implications of the Tax Cuts and Jobs Act (which we refer to as SAB 118) describes three scenarios associated with a company’s status of accounting for income tax reform. Under the SAB 118 guidance, we have determined that we are able to make reasonable estimates for certain effects of tax reform. We are continuing to evaluate the accounting impactions of the TCJA as we continue to assemble and analyze all the information required to prepare and analyze these effects and await additional guidance from the U.S. Treasury Department, IRS or other standard-setting bodies. Additionally, we continue to analyze other information and regulatory guidance and accordingly we may record additional provisional amounts or adjustments to provisional amounts in future periods.

Share Repurchase Program

Share Repurchase Program	3 Months Ended
	Mar. 31, 2018
Share Repurchase Program
Share Repurchase Program	10. Share Repurchase Program On August 3, 2007, the Board of Directors approved a share repurchase program of up to $30,000 of the Company’s outstanding common shares. As of March 31, 2018, the Board of Directors had cumulatively authorized increases to the existing share repurchase program of up to $150,000 of its outstanding common shares. Under the program, the Company may repurchase shares of its common stock for cash in public or private transactions, in the open market or otherwise. The timing of such repurchases and actual number of shares repurchased will depend on a variety of factors including price, market conditions and applicable regulatory and corporate requirements. The program does not require the Company to repurchase any specific number of shares and it may be modified, suspended or terminated at any time without prior notice. No share purchases were made by the Company under the program during the three months ended March 31, 2018 and 2017. As of March 31, 2018, the Company has purchased 2,279,570 shares at a cost of $83,835.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2018
Subsequent Events
Subsequent Events	11. Subsequent Events

Earnings per Weighted Average20

Earnings per Weighted Average Common Share (Tables)	3 Months Ended
	Mar. 31, 2018
Earnings per Weighted Average Common Share
Computation of basic and diluted EPS	Three Months Ended March 31, 2018 2017 Earnings attributable to common shareholders - basic and diluted: Net income from continuing operations $ 9,125 $ 12,019 Allocation of income for participating shares (56) (79) Net income from continuing operations attributed to common shareholders $ 9,069 $ 11,940 Earnings per share denominator - basic and diluted Total weighted average common shares outstanding, including participating shares 15,139,036 15,079,684 Less: weighted average participating shares (93,074) (99,679) Basic earnings per share denominator 15,045,962 14,980,005 Common equivalent shares- stock options — — Common equivalent shares- non-vested performance stock grants 145,177 116,723 Diluted earnings per share denominator 15,191,139 15,096,728 Basic earnings per share $ 0.60 $ 0.80 Diluted earnings per share $ 0.60 $ 0.79 Undistributed earnings attributable to common shareholders - basic and diluted: Net income from continuing operations attributable to common shareholders -Basic $ 0.60 $ 0.80 Dividends declared (0.80) (0.70) Undistributed earnings $ (0.20) $ 0.10 Net income from continuing operations attributable to common shareholders -Diluted $ 0.60 $ 0.79 Dividends declared (0.80) (0.70) Undistributed earnings $ (0.20) $ 0.09

Share-Based Compensation (Table

Share-Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2018
Share-Based Compensation
Schedule of restricted stock and performance-based restricted stock activity	Shares Weighted Performance-based Weighted Under Average Shares Under Average Restriction Fair Value Restriction Fair Value Outstanding at beginning of year 93,086 $ 63.13 105,660 $ 62.75 Granted 39,451 75.05 31,668 72.21 Vested and unrestricted (42,204) 62.36 (27,003) 61.48 Forfeited — — (4,202) 61.48 Outstanding at end of period 90,333 $ 68.67 106,123 $ 66.79

Investments (Tables)

Investments (Tables)	3 Months Ended
	Mar. 31, 2018
Investments
Gross unrealized gains and losses on investments in securities	As of March 31, 2018 Gross Unrealized Losses (3) Cost or Gross Non-OTTI OTTI Estimated Amortized Unrealized Unrealized Unrealized Fair Cost Gains Losses Losses (4) Value U.S. Treasury securities $ 1,808 $ — $ (39) $ — $ 1,769 Obligations of states and political subdivisions 385,669 8,280 (2,741) — 391,208 Residential mortgage-backed securities (1) 244,037 1,625 (5,796) — 239,866 Commercial mortgage-backed securities 39,248 42 (840) — 38,450 Other asset-backed securities 61,945 260 (396) — 61,809 Corporate and other securities 424,537 3,971 (6,487) — 422,021 Subtotal, fixed maturity securities 1,157,244 14,178 (16,299) — 1,155,123 Equity securities (2) 98,696 19,369 (1,464) — 116,601 Other invested assets (5) 24,883 — — — 24,883 Totals $ 1,280,823 $ 33,547 $ (17,763) $ — $ 1,296,607 As of December 31, 2017 Gross Unrealized Losses (3) Cost or Gross Non-OTTI OTTI Estimated Amortized Unrealized Unrealized Unrealized Fair Cost Gains Losses Losses (4) Value U.S. Treasury securities $ 1,809 $ — $ (18) $ — $ 1,791 Obligations of states and political subdivisions 391,806 12,244 (966) — 403,084 Residential mortgage-backed securities (1) 223,257 2,352 (2,843) — 222,766 Commercial mortgage-backed securities 39,268 415 (314) — 39,369 Other asset-backed securities 72,665 173 (225) — 72,613 Corporate and other securities 427,892 6,962 (2,451) — 432,403 Subtotal, fixed maturity securities 1,156,697 22,146 (6,817) — 1,172,026 Equity securities (2) 90,481 21,995 (609) — 111,867 Other invested assets (5) 23,162 — — — 23,162 Totals $ 1,270,340 $ 44,141 $ (7,426) $ — $ 1,307,055 (1) Residential mortgage-backed securities consists primarily of obligations of U.S. Government agencies including collateralized mortgage obligations issued, guaranteed and/or insured by the following issuers: Government National Mortgage Association (GNMA), Federal Home Loan Mortgage Corporation (FHLMC), Federal National Mortgage Association (FNMA) and the Federal Home Loan Bank (FHLB). (2) Equity securities included interests in mutual funds held to fund the Company’s executive deferred compensation plan. (3) Our investment portfolio included 600 and 367 securities in an unrealized loss position at March 31, 2018 and December 31, 2017, respectively. (4) Amounts in this column represent other-than-temporary impairment (“OTTI”) recognized in accumulated other comprehensive income. (5) Other invested assets are accounted for under the equity method which approximated fair value.
Amortized cost and the estimated fair value of fixed maturity securities, by maturity	As of March 31, 2018 Amortized Estimated Cost Fair Value Due in one year or less $ 49,054 $ 49,035 Due after one year through five years 289,999 292,493 Due after five years through ten years 260,296 259,596 Due after ten years through twenty years 207,835 208,966 Due after twenty years 4,829 4,908 Asset-backed securities 345,231 340,125 Totals $ 1,157,244 $ 1,155,123
Gross realized gains and losses on sales of investments	Three Months Ended March 31, 2018 2017 Gross realized gains Fixed maturity securities $ 135 $ 573 Equity securities 1,644 1,115 Gross realized losses Fixed maturity securities (84) (108) Equity securities (389) (38) Net realized gains on investments $ 1,306 $ 1,542
Gross unrealized losses included in the Company's investment portfolio and the fair value of those securities	As of March 31, 2018 Less than 12 Months 12 Months or More Total Estimated Unrealized Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses Fair Value Losses U.S. Treasury securities $ 1,769 $ 39 $ — $ — $ 1,769 $ 39 Obligations of states and political subdivisions 87,643 1,197 29,173 1,544 116,816 2,741 Residential mortgage-backed securities 165,938 4,120 37,321 1,676 203,259 5,796 Commercial mortgage-backed securities 26,383 341 7,802 499 34,185 840 Other asset-backed securities 30,429 323 7,984 73 38,413 396 Corporate and other securities 190,789 4,439 36,922 2,048 227,711 6,487 Subtotal, fixed maturity securities 502,951 10,459 119,202 5,840 622,153 16,299 Equity securities 16,881 1,054 2,220 410 19,101 1,464 Total temporarily impaired securities $ 519,832 $ 11,513 $ 121,422 $ 6,250 $ 641,254 $ 17,763 As of December 31, 2017 Less than 12 Months 12 Months or More Total Estimated Unrealized Estimated Unrealized Estimated Unrealized Fair Value Losses Fair Value Losses Fair Value Losses U.S. Treasury securities $ 1,791 $ 18 $ — $ — $ 1,791 $ 18 Obligations of states and political subdivisions 19,603 152 30,018 814 49,621 966 Residential mortgage-backed securities 126,713 1,724 39,638 1,119 166,351 2,843 Commercial mortgage-backed securities 5,457 30 8,027 284 13,484 314 Other asset-backed securities 25,769 167 18,270 58 44,039 225 Corporate and other securities 94,863 1,189 36,440 1,262 131,303 2,451 Subtotal, fixed maturity securities 274,196 3,280 132,393 3,537 406,589 6,817 Equity securities 4,730 361 2,420 248 7,150 609 Total temporarily impaired securities $ 278,926 $ 3,641 $ 134,813 $ 3,785 $ 413,739 $ 7,426
Credit loss recognized in earnings related to fixed maturity securities	Three Months Ended March 31, 2018 2017 Credit losses on fixed maturity securities, beginning of period $ 892 $ 1,094 Add: credit losses on OTTI not previously recognized — — Less: credit losses on securities sold (276) (106) Less: credit losses on securities impaired due to intent to sell — — Add: credit losses on previously impaired securities — — Less: increases in cash flows expected on previously impaired securities — — Credit losses on fixed maturity securities, end of period $ 616 $ 988
Components of net investment income	Three Months Ended March 31, 2018 2017 Interest on fixed maturity securities $ 10,109 $ 8,834 Dividends on equity securities 785 660 Equity in earnings of other invested assets 341 237 Interest on other assets 22 22 Interest on cash and cash equivalents — — Total investment income 11,257 9,753 Investment expenses 726 658 Net investment income $ 10,531 $ 9,095
Fair value measurements for investments	As of March 31, 2018 Total Level 1 Inputs Level 2 Inputs Level 3 Inputs U.S. Treasury securities $ 1,769 $ — $ 1,769 $ — Obligations of states and political subdivisions 391,208 — 391,208 — Residential mortgage-backed securities 239,866 — 239,866 — Commercial mortgage-backed securities 38,450 — 38,450 — Other asset-backed securities 61,809 — 61,809 — Corporate and other securities 422,021 — 422,021 — Equity securities 88,097 87,417 — 680 Total investment securities $ 1,243,220 $ 87,417 $ 1,155,123 $ 680 As of December 31, 2017 Total Level 1 Inputs Level 2 Inputs Level 3 Inputs U.S. Treasury securities $ 1,791 $ — $ 1,791 $ — Obligations of states and political subdivisions 403,084 — 403,084 — Residential mortgage-backed securities 222,766 — 222,766 — Commercial mortgage-backed securities 39,369 — 39,369 — Other asset-backed securities 72,613 — 72,613 — Corporate and other securities 432,403 — 432,403 — Equity securities 87,737 87,057 — 680 Total investment securities $ 1,259,763 $ 87,057 $ 1,172,026 $ 680
Changes in the Company's Level 3 fair value securities	Three Months Ended March 31, 2018 2017 Level 3 Level 3 Fair Value Fair Value Securities Securities Balance at beginning of period $ 680 678 Net gains and losses included in earnings — — Net gains included in other comprehensive income — — Purchases — — Sales — — Transfers into Level 3 — — Transfers out of Level 3 — — Balance at end of period $ 680 $ 678 Amount of total losses included in earnings attributable to the change in unrealized losses related to assets still held at end of period $ — $ —

Loss and Loss Adjustment Expe23

Loss and Loss Adjustment Expense Reserves (Tables)	3 Months Ended
	Mar. 31, 2018
Loss and Loss Adjustment Expense Reserves
Schedule of reconciliation of beginning and ending reserves for losses and loss adjustment expenses (LAE)	Three Months Ended March 31, 2018 2017 Reserves for losses and LAE at beginning of year $ 574,054 $ 560,321 Less receivable from reinsurers related to unpaid losses and LAE (83,085) (83,724) Net reserves for losses and LAE at beginning of year 490,969 476,597 Incurred losses and LAE, related to: Current year 151,795 138,862 Prior years (14,151) (10,432) Total incurred losses and LAE 137,644 128,430 Paid losses and LAE related to: Current year 83,396 82,589 Prior years 52,510 40,135 Total paid losses and LAE 135,906 122,724 Net reserves for losses and LAE at end of period 492,707 482,303 Plus receivable from reinsurers related to unpaid losses and LAE 87,067 87,246 Reserves for losses and LAE at end of period $ 579,774 $ 569,549

Recent Accounting Pronounceme24

Recent Accounting Pronouncements (Details) - USD ($) $ in Thousands	Jan. 01, 2018	Dec. 22, 2017	Mar. 31, 2018
Statutory tax rate		35.00%	21.00%
Accounting Standards Update 2016-01
Cumulative effect of change in accounting principle	$ 16,895
Accounting Standards Update 2018-02
Cumulative effect of change in accounting principle	$ 4,736

Earnings per Weighted Average25

Earnings per Weighted Average Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Earnings attributable to common shareholders - basic and diluted:
Net income from continuing operations	$ 9,125	$ 12,019
Allocation of income for participating shares	(56)	(79)
Net income from continuing operations attributed to common shareholders	$ 9,069	$ 11,940
Total weighted average common shares outstanding, including participating shares	15,139,036	15,079,684
Less: weighted average participating shares	(93,074)	(99,679)
Basic earnings per share denominator	15,045,962	14,980,005
Common equivalent shares- non-vested performance stock grants	145,177	116,723
Diluted earnings per share denominator	15,191,139	15,096,728
Basic earnings per share (in dollars per share)	$ 0.60	$ 0.80
Diluted earnings per share (in dollars per share)	0.60	0.79
Undistributed earnings attributable to common shareholders - basic and diluted:
Net income from continuing operations attributable to common shareholders -Basic	0.60	0.80
Dividends declared	(0.80)	(0.70)
Undistributed earnings	(0.20)	0.10
Undistributed earnings attributable to common shareholders - diluted
Net income from continuing operations attributable to common shareholders -Diluted	0.60	0.79
Dividends declared	(0.80)	(0.70)
Undistributed earnings	$ (0.20)	$ 0.09
Non Vested Performance Stock Grants
Undistributed earnings attributable to common shareholders - diluted
Antidilutive common shares	0	738

Share-Based Compensation (Detai

Share-Based Compensation (Details) - shares	Apr. 02, 2018	Mar. 31, 2018
The Incentive Plan
Maximum number of shares of common stock with respect to which awards may be granted		2,500,000
Number of shares available for future grant		137,968
The 2018 Plan
Maximum number of shares of common stock with respect to which awards may be granted	350,000

Share-Based Compensation Restri

Share-Based Compensation Restricted Stock Activity (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Weighted Average Fair Value
Unrecognized compensation expense related to non-vested restricted stock awards	$ 9,941
Weighted average period expected for recognition of compensation expense related to non-vested restricted stock awards	1 year 10 months 24 days
Total fair value of the shares that were vested and unrestricted during the period	$ 4,292	$ 3,308
Compensation Expense, Net of Tax	1,275	989
Income tax benefits from compensation expense	$ 339	$ 533
Restricted Stock
Shares Under Restriction
Outstanding at beginning of year (in shares)	93,086
Granted (in shares)	39,451
Vested and unrestricted (in shares)	(42,204)
Outstanding at end of period (in shares)	90,333
Weighted Average Fair Value
Outstanding at beginning of year (in dollars per share)	$ 63.13
Granted (in dollars per share)	75.05
Vested and unrestricted (in dollars per share)	62.36
Outstanding at end of period (in dollars per share)	$ 68.67
Restricted Stock | Non-executive grants prior to 2018
Share-Based Compensation
Vesting period	5 years
Restricted Stock | Executives and non-executives (2018 and after)
Share-Based Compensation
Vesting period	3 years
Restricted Stock | First anniversary of grant date | Executives and non-executives (2018 and after)
Share-Based Compensation
Actual Payouts (as a percent)	30.00%
Restricted Stock | Second anniversary of grant date | Executives and non-executives (2018 and after)
Share-Based Compensation
Actual Payouts (as a percent)	30.00%
Restricted Stock | Third anniversary of grant date | Executives and non-executives (2018 and after)
Share-Based Compensation
Actual Payouts (as a percent)	40.00%
Performance-based | Restricted Stock
Share-Based Compensation
Vesting period	3 years
Shares Under Restriction
Outstanding at beginning of year (in shares)	105,660
Granted (in shares)	31,668
Vested and unrestricted (in shares)	(27,003)
Forfeited (in shares)	(4,202)
Outstanding at end of period (in shares)	106,123
Weighted Average Fair Value
Outstanding at beginning of year (in dollars per share)	$ 62.75
Granted (in dollars per share)	72.21
Vested and unrestricted (in dollars per share)	61.48
Forfeited (in dollars per share)	61.48
Outstanding at end of period (in dollars per share)	$ 66.79
Performance-based | Restricted Stock | Minimum
Share-Based Compensation
Actual Payouts (as a percent)	0.00%
Performance-based | Restricted Stock | Maximum
Share-Based Compensation
Actual Payouts (as a percent)	200.00%

Investments (Details)

Investments (Details) $ in Thousands	Mar. 31, 2018USD ($)security	Dec. 31, 2017USD ($)security
Marketable securities
Fixed maturity securities, amortized cost	$ 1,157,244	$ 1,156,697
Fixed maturity securities, Gross Unrealized Gains	14,178	22,146
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(16,299)	(6,817)
Fixed maturity securities, Estimated Fair Value	1,155,123	1,172,026
Equity securities, Cost or Amortized Cost	98,696	90,481
Equity securities, Estimated Fair Value	116,601	111,867
Other invested assets, Cost or Amortized Cost	24,883	23,162
Cost or Amortized Cost	1,280,823	1,270,340
Gross Unrealized Gains	33,547	44,141
Gross Non-OTTI Unrealized Losses	(17,763)	(7,426)
Estimated Fair Value	$ 1,296,607	$ 1,307,055
Number of securities in an unrealized loss position | security	600	367
U.S. Treasury securities
Marketable securities
Fixed maturity securities, amortized cost	$ 1,808	$ 1,809
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(39)	(18)
Fixed maturity securities, Estimated Fair Value	1,769	1,791
Obligations of states and political subdivisions
Marketable securities
Fixed maturity securities, amortized cost	385,669	391,806
Fixed maturity securities, Gross Unrealized Gains	8,280	12,244
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(2,741)	(966)
Fixed maturity securities, Estimated Fair Value	391,208	403,084
Residential mortgage-backed securities
Marketable securities
Fixed maturity securities, amortized cost	244,037	223,257
Fixed maturity securities, Gross Unrealized Gains	1,625	2,352
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(5,796)	(2,843)
Fixed maturity securities, Estimated Fair Value	239,866	222,766
Commercial mortgage-backed securities
Marketable securities
Fixed maturity securities, amortized cost	39,248	39,268
Fixed maturity securities, Gross Unrealized Gains	42	415
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(840)	(314)
Fixed maturity securities, Estimated Fair Value	38,450	39,369
Other asset-backed securities
Marketable securities
Fixed maturity securities, amortized cost	61,945	72,665
Fixed maturity securities, Gross Unrealized Gains	260	173
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(396)	(225)
Fixed maturity securities, Estimated Fair Value	61,809	72,613
Corporate and other securities
Marketable securities
Fixed maturity securities, amortized cost	424,537	427,892
Fixed maturity securities, Gross Unrealized Gains	3,971	6,962
Fixed maturity securities, Non-OTTI Gross Unrealized Losses	(6,487)	(2,451)
Fixed maturity securities, Estimated Fair Value	422,021	432,403
Equity securities
Marketable securities
Equity securities, Cost or Amortized Cost	98,696	90,481
Equity securities, Gross Unrealized Gains	19,369	21,995
Equity securities, Non-OTTI Gross Unrealized Losses	(1,464)	(609)
Equity securities, Estimated Fair Value	116,601	111,867
Other invested assets
Marketable securities
Other invested assets, Cost or Amortized Cost	24,883	23,162
Other invested assets, Estimated Fair Value	$ 24,883	$ 23,162

Investments Amortized Cost and

Investments Amortized Cost and Estimated Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Amortized Cost
Due in one year or less, Amortized Cost	$ 49,054
Due after one year through five years, Amortized Cost	289,999
Due after five years though ten years, Amortized Cost	260,296
Due after ten years through twenty years, Amortized Cost	207,835
Due after twenty years, Amortized Cost	4,829
Asset-backed securities, Amortized Cost	345,231
Totals, Amortized Cost	1,157,244	$ 1,156,697
Estimated Fair Value
Due in one year or less, Fair Value	49,035
Due after one year through five years, Fair Value	292,493
Due after five years through ten years, Fair Value	259,596
Due after ten years through twenty years, Fair Value	208,966
Due after twenty years, Fair Value	4,908
Asset-backed securities, Fair Value	340,125
Totals, Fair Value	$ 1,155,123	$ 1,172,026

Investments Gross Realized Gain

Investments Gross Realized Gains and Losses (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Marketable securities
Net realized gains on investments	$ 1,306	$ 1,542
Subtotal, fixed maturity securities
Marketable securities
Gross realized gains	135	573
Gross realized losses	(84)	(108)
Equity securities
Marketable securities
Gross realized gains	1,644	1,115
Gross realized losses	$ (389)	$ (38)

Investments Gross Unrealized Lo

Investments Gross Unrealized Losses and Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Marketable Securities
Estimated Fair Value, Less than 12 Months	$ 519,832	$ 278,926
Estimated Fair Value, 12 Months or More	121,422	134,813
Estimated Fair Value, Total	641,254	413,739
Unrealized Losses, Less than 12 Months	11,513	3,641
Unrealized Losses, 12 Months or More	6,250	3,785
Unrealized Losses, Total	17,763	7,426
Subtotal, fixed maturity securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	502,951	274,196
Estimated Fair Value, 12 Months or More	119,202	132,393
Estimated Fair Value, Total	622,153	406,589
Unrealized Losses, Less than 12 Months	10,459	3,280
Unrealized Losses, 12 Months or More	5,840	3,537
Unrealized Losses, Total	16,299	6,817
U.S. Treasury securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	1,769	1,791
Estimated Fair Value, Total	1,769	1,791
Unrealized Losses, Less than 12 Months	39	18
Unrealized Losses, Total	39	18
Obligations of states and political subdivisions
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	87,643	19,603
Estimated Fair Value, 12 Months or More	29,173	30,018
Estimated Fair Value, Total	116,816	49,621
Unrealized Losses, Less than 12 Months	1,197	152
Unrealized Losses, 12 Months or More	1,544	814
Unrealized Losses, Total	2,741	966
Residential mortgage-backed securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	165,938	126,713
Estimated Fair Value, 12 Months or More	37,321	39,638
Estimated Fair Value, Total	203,259	166,351
Unrealized Losses, Less than 12 Months	4,120	1,724
Unrealized Losses, 12 Months or More	1,676	1,119
Unrealized Losses, Total	5,796	2,843
Commercial mortgage-backed securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	26,383	5,457
Estimated Fair Value, 12 Months or More	7,802	8,027
Estimated Fair Value, Total	34,185	13,484
Unrealized Losses, Less than 12 Months	341	30
Unrealized Losses, 12 Months or More	499	284
Unrealized Losses, Total	840	314
Other asset-backed securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	30,429	25,769
Estimated Fair Value, 12 Months or More	7,984	18,270
Estimated Fair Value, Total	38,413	44,039
Unrealized Losses, Less than 12 Months	323	167
Unrealized Losses, 12 Months or More	73	58
Unrealized Losses, Total	396	225
Corporate and other securities
Fixed Maturity Securities
Estimated Fair Value, Less than 12 Months	190,789	94,863
Estimated Fair Value, 12 Months or More	36,922	36,440
Estimated Fair Value, Total	227,711	131,303
Unrealized Losses, Less than 12 Months	4,439	1,189
Unrealized Losses, 12 Months or More	2,048	1,262
Unrealized Losses, Total	6,487	2,451
Equity securities
Equity Securities
Estimated Fair Value, Less than 12 Months	16,881	4,730
Estimated Fair Value, 12 Months or More	2,220	2,420
Estimated Fair Value, Total	19,101	7,150
Unrealized Losses, Less than 12 Months	1,054	361
Unrealized Losses, 12 Months or More	410	248
Unrealized Losses, Total	$ 1,464	$ 609

Investments Other (Details)

Investments Other (Details) $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2018USD ($)item	Mar. 31, 2017USD ($)item	Dec. 31, 2017USD ($)
Other-Than-Temporary Impairments
Securities held	$ 1,243,220		$ 1,259,763
Other than Temporary Impairment, Credit Losses Recognized in Earnings [Roll Forward]
Credit losses on fixed maturity securities, beginning of period	892	$ 1,094	1,094
Less: credit losses on securities sold	(276)	(106)
Credit losses on fixed maturity securities, end of period	616	$ 988	892
Amounts included in accumulated other comprehensive income related to OTTI securities	0		0
Available-for-sale investments	1,155,123		$ 1,172,026
Short-term Investments	$ 0
Level 3 Securities Held Number | item	1	1
Subprime mortgage debt securities
Other-Than-Temporary Impairments
Securities held	$ 0

Investments Components of Net I

Investments Components of Net Investment Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Components of net investment income
Interest on fixed maturity securities	$ 10,109	$ 8,834
Dividends on equity securities	785	660
Equity in earnings of other invested assets	341	237
Interest on other assets	22	22
Total investment income	11,257	9,753
Investment expenses	726	658
Net investment income	$ 10,531	$ 9,095

Investments Fair Value Measurem

Investments Fair Value Measurements (Details) - USD ($) $ in Thousands	Mar. 31, 2018	Dec. 31, 2017
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	$ 1,155,123	$ 1,172,026
Equity securities, Estimated Fair Value	116,601	111,867
Marketable Securities, Total	1,243,220	1,259,763
U.S. Treasury securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	1,769	1,791
Obligations of states and political subdivisions
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	391,208	403,084
Residential mortgage-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	239,866	222,766
Commercial mortgage-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	38,450	39,369
Other asset-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	61,809	72,613
Corporate and other securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	422,021	432,403
Equity securities
Fair value of financial instruments
Equity securities, Estimated Fair Value	88,097	87,737
Level 1 Inputs
Fair value of financial instruments
Marketable Securities, Total	87,417	87,057
Level 1 Inputs | Equity securities
Fair value of financial instruments
Equity securities, Estimated Fair Value	87,417	87,057
Level 2 Inputs
Fair value of financial instruments
Marketable Securities, Total	1,155,123	1,172,026
Level 2 Inputs | U.S. Treasury securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	1,769	1,791
Level 2 Inputs | Obligations of states and political subdivisions
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	391,208	403,084
Level 2 Inputs | Residential mortgage-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	239,866	222,766
Level 2 Inputs | Commercial mortgage-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	38,450	39,369
Level 2 Inputs | Other asset-backed securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	61,809	72,613
Level 2 Inputs | Corporate and other securities
Fair value of financial instruments
Fixed maturity securities, Estimated Fair Value	422,021	432,403
Level 3 Inputs
Fair value of financial instruments
Marketable Securities, Total	680	680
Level 3 Inputs | Equity securities
Fair value of financial instruments
Equity securities, Estimated Fair Value	$ 680	$ 680

Investments Level 3 and Other (

Investments Level 3 and Other (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2017
Transfers between Levels
Transfers from Level 1 to Level 2	$ 0		$ 0
Changes in the Company's Level 3 fair value securities
Balance at beginning of period	680		678
Transfers into Level 3	0		0
Balance at end of period	680	$ 680	$ 678
Period of advance notice before quarter end		45 days
Accounting Standards Update 2015-07
Changes in the Company's Level 3 fair value securities
Alternative investments fair value	$ 28,504	$ 24,130

Loss and Loss Adjustment Expe36

Loss and Loss Adjustment Expense Reserves (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017
Loss and Loss Adjustment Expense Reserves
Reserves for losses and LAE at beginning of year	$ 574,054	$ 560,321
Less receivable from reinsurers related to unpaid losses and LAE	(83,085)	(83,724)
Net reserves for losses and LAE at beginning of year	490,969	476,597
Incurred losses and LAE, related to:
Current year	151,795	138,862
Prior years	(14,151)	(10,432)
Total incurred losses and LAE	137,644	128,430
Paid losses and LAE related to:
Current year	83,396	82,589
Prior years	52,510	40,135
Total paid losses and LAE	135,906	122,724
Net reserves for losses and LAE at end of period	492,707	482,303
Plus receivable from reinsurers related to unpaid losses and LAE	87,067	87,246	$ 83,085
Reserves for losses and LAE at end of period	$ 579,774	$ 569,549

Commitments and Contingencies (

Commitments and Contingencies (Details) $ in Thousands	12 Months Ended
	Dec. 31, 2017USD ($)
Commitments and Contingencies
Reinsurance recoverables in arbitration	$ 20,918
Award for settlement of paid and outstanding losses	9,200
Unrecovered reinsurance expensed	$ 11,718

Debt (Details)

Debt (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Mar. 31, 2018	Dec. 31, 2017
Revolving Credit Agreement | LIBOR rate
Debt
Variable interest rate basis	LIBOR
Spread on variable rate (as a percent)	1.25%
Revolving Credit Agreement | Prime rate
Debt
Variable interest rate basis	prime rate
Revolving Credit Agreement | Federal Funds Effective Swap Rate
Debt
Variable interest rate basis	federal funds rate
Spread on variable rate (as a percent)	1.25%
Additional spread on variable rate (as a percent)	0.50%
RBS Citizens | Revolving Credit Agreement
Debt
Current borrowing capacity	$ 30,000
Maximum borrowing capacity	50,000
Default trigger, principal amount	10,000
Outstanding amount	$ 0	$ 0
Commitment fee (as a percent)	0.25%	0.25%
F H L B Boston
Debt
Outstanding amount	$ 0	$ 0
Maximum borrowing capacity using eligible invested assets as collateral	$ 273,189

Income Taxes (Details)

Income Taxes (Details)	Dec. 22, 2017	Mar. 31, 2018
Income Taxes
Statutory tax rate	35.00%	21.00%

Share Repurchase Program (Detai

Share Repurchase Program (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Dec. 31, 2017	Aug. 03, 2007
Share Repurchase Program
Share Repurchase Program	$ 150,000			$ 30,000
Number of common shares purchased during period under the program	0	0
Treasury stock shares	2,279,570		2,279,570
Treasury stock, at cost	$ 83,835		$ 83,835