Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 05, 2015 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | ATLANTIC AMERICAN CORP | |
Entity Central Index Key | 8,177 | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 20,547,430 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
ASSETS | ||
Cash and cash equivalents | $ 14,637 | $ 16,375 |
Investments: | ||
Fixed maturities (cost: $213,450 and $207,568) | 211,810 | 214,888 |
Common and non-redeemable preferred stocks (cost: $10,953 and $11,969) | 19,988 | 18,924 |
Other invested assets (cost: $2,372 and $2,995) | 2,372 | 2,995 |
Policy loans | 2,181 | 2,202 |
Real estate | 38 | 38 |
Investment in unconsolidated trusts | 1,238 | 1,238 |
Total investments | 237,627 | 240,285 |
Receivables: | ||
Reinsurance | 14,243 | 14,348 |
Insurance premiums and other (net of allowance for doubtful accounts: $683 and $439) | 14,404 | 10,728 |
Deferred income taxes, net | 310 | 0 |
Deferred acquisition costs | 27,675 | 26,981 |
Other assets | 5,763 | 5,747 |
Intangibles | 2,544 | 2,544 |
Total assets | 317,203 | 317,008 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Future policy benefits | 71,576 | 70,845 |
Unearned premiums | 27,251 | 24,544 |
Losses and claims | 65,241 | 66,625 |
Other policy liabilities | 1,294 | 2,080 |
Total insurance reserves and policyholder funds | 165,362 | 164,094 |
Accounts payable and accrued expenses | 14,891 | 13,586 |
Deferred income taxes, net | 0 | 1,395 |
Junior subordinated debenture obligations, net | 33,738 | 33,738 |
Total liabilities | $ 213,991 | $ 212,813 |
Commitments and contingencies (Note 7) | ||
Shareholders' equity: | ||
Preferred stock, $1 par, 4,000,000 shares authorized; Series D preferred, 55,000 shares issued and outstanding; $5,500 redemption value | $ 55 | $ 55 |
Common stock, $1 par, 50,000,000 shares authorized; shares issued: 22,400,894; shares outstanding: 20,566,330 and 20,600,039 | 22,401 | 22,401 |
Additional paid-in capital | 56,619 | 56,491 |
Retained earnings | 25,429 | 21,866 |
Accumulated other comprehensive income | 4,807 | 9,279 |
Unearned stock grant compensation | (395) | (460) |
Treasury stock, at cost: 1,834,564 and 1,800,855 shares | (5,704) | (5,437) |
Total shareholders' equity | 103,212 | 104,195 |
Total liabilities and shareholders' equity | $ 317,203 | $ 317,008 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Investments: | ||
Fixed maturities, cost | $ 213,450 | $ 207,568 |
Common and non-redeemable preferred stocks, cost | 10,953 | 11,969 |
Other invested assets, cost | 2,372 | 2,995 |
Receivables: | ||
Insurance premiums and other, allowance for doubtful accounts | $ 683 | $ 439 |
Shareholders' equity: | ||
Preferred stock, par value (in dollars per share) | $ 1 | $ 1 |
Preferred stock, shares authorized (in shares) | 4,000,000 | 4,000,000 |
Preferred stock, shares issued (in shares) | 55,000 | 55,000 |
Preferred stock, shares outstanding (in shares) | 55,000 | 55,000 |
Preferred stock, redemption value | $ 5,500 | $ 5,500 |
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 22,400,894 | 22,400,894 |
Common stock, shares outstanding (in shares) | 20,566,330 | 20,600,039 |
Treasury stock, at cost (in shares) | 1,834,564 | 1,800,855 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenue: | ||||
Insurance premiums | $ 37,859 | $ 38,337 | $ 113,349 | $ 115,211 |
Investment income | 2,456 | 2,678 | 7,547 | 7,875 |
Realized investment gains, net | 7 | 848 | 5,106 | 1,441 |
Other income | 37 | 793 | 78 | 875 |
Total revenue | 40,359 | 42,656 | 126,080 | 125,402 |
Benefits and expenses: | ||||
Insurance benefits and losses incurred | 24,637 | 27,094 | 76,261 | 80,991 |
Commissions and underwriting expenses | 11,816 | 10,238 | 33,024 | 30,219 |
Interest expense | 361 | 388 | 1,064 | 1,251 |
Other expense | 3,180 | 3,349 | 10,167 | 9,375 |
Total benefits and expenses | 39,994 | 41,069 | 120,516 | 121,836 |
Income before income taxes | 365 | 1,587 | 5,564 | 3,566 |
Income tax expense | 127 | 136 | 1,290 | 418 |
Net income | 238 | 1,451 | 4,274 | 3,148 |
Preferred stock dividends | (100) | (117) | (299) | (353) |
Net income applicable to common shareholders | $ 138 | $ 1,334 | $ 3,975 | $ 2,795 |
Earnings per common share (basic and diluted) (in dollars per share) | $ 0.01 | $ 0.06 | $ 0.19 | $ 0.13 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) [Abstract] | |||||
Net income | $ 238 | $ 1,451 | $ 4,274 | $ 3,148 | |
Available-for-sale securities: | |||||
Gross unrealized holding gain (loss) arising in the period | (3,729) | (7,103) | (1,774) | 2,627 | |
Related income tax effect | 1,306 | 2,487 | 621 | (919) | |
Less: reclassification adjustment for net realized gains included in net income | [1] | (7) | (848) | (5,106) | (1,441) |
Related income tax effect | [2] | 2 | 296 | 1,787 | 504 |
Net effect on other comprehensive income (loss) | (2,428) | (5,168) | (4,472) | 771 | |
Total comprehensive income (loss) | $ (2,190) | $ (3,717) | $ (198) | $ 3,919 | |
[1] | Realized gains on available-for-sale securities recognized in realized investment gains, net on the accompanying condensed consolidated statements of operations. | ||||
[2] | Income tax effect on reclassification adjustment for net realized gains included in income tax expense on the accompanying condensed consolidated statements of operations. |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - USD ($) $ in Thousands | Preferred Stock [Member] | Common Stock [Member] | Additional Paid-In Capital [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Income [Member] | Unearned Stock Grant Compensation [Member] | Treasury Stock [Member] | Total |
Balance at Dec. 31, 2013 | $ 65 | $ 22,401 | $ 57,103 | $ 18,738 | $ 6,204 | $ (485) | $ (3,099) | $ 100,927 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 0 | 0 | 0 | 3,148 | 0 | 0 | 0 | 3,148 |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | 0 | 771 | 0 | 0 | 771 |
Dividends on common stock | 0 | 0 | 0 | (422) | 0 | 0 | 0 | (422) |
Dividends accrued on preferred stock | 0 | 0 | 0 | (353) | 0 | 0 | 0 | (353) |
Restricted stock grants | 0 | 0 | 328 | 0 | 0 | (559) | 231 | 0 |
Amortization of unearned compensation | 0 | 0 | 0 | 0 | 0 | 480 | 0 | 480 |
Purchase of shares for treasury | 0 | 0 | 0 | 0 | 0 | 0 | (2,440) | (2,440) |
Issuance of shares under stock plans | 0 | 0 | 42 | 0 | 0 | 0 | 29 | 71 |
Balance at Sep. 30, 2014 | 65 | 22,401 | 57,473 | 21,111 | 6,975 | (564) | (5,279) | 102,182 |
Balance at Dec. 31, 2014 | 55 | 22,401 | 56,491 | 21,866 | 9,279 | (460) | (5,437) | 104,195 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 0 | 0 | 0 | 4,274 | 0 | 0 | 0 | 4,274 |
Other comprehensive income (loss), net of tax | 0 | 0 | 0 | 0 | (4,472) | 0 | 0 | (4,472) |
Dividends on common stock | 0 | 0 | 0 | (412) | 0 | 0 | 0 | (412) |
Dividends accrued on preferred stock | 0 | 0 | 0 | (299) | 0 | 0 | 0 | (299) |
Restricted stock grants | 0 | 0 | 106 | 0 | 0 | (184) | 78 | 0 |
Amortization of unearned compensation | 0 | 0 | 0 | 0 | 0 | 249 | 0 | 249 |
Purchase of shares for treasury | 0 | 0 | 0 | 0 | 0 | 0 | (360) | (360) |
Issuance of shares under stock plans | 0 | 0 | 22 | 0 | 0 | 0 | 15 | 37 |
Balance at Sep. 30, 2015 | $ 55 | $ 22,401 | $ 56,619 | $ 25,429 | $ 4,807 | $ (395) | $ (5,704) | $ 103,212 |
CONDENSED CONSOLIDATED STATEME7
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 4,274 | $ 3,148 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Amortization of deferred acquisition costs | 7,857 | 8,060 |
Acquisition costs deferred | (8,551) | (7,543) |
Realized investment gains, net | (5,106) | (1,441) |
Gain on purchase of debt securities | 0 | (750) |
Increase in insurance reserves | 1,268 | 3,191 |
Compensation expense related to share awards | 249 | 480 |
Depreciation and amortization | 834 | 675 |
Deferred income tax expense | 703 | 335 |
Increase in receivables, net | (3,571) | (5,976) |
Increase (decrease) in other liabilities | 1,006 | (1,788) |
Other, net | (330) | (164) |
Net cash used in operating activities | (1,367) | (1,773) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Proceeds from investments sold, called or matured | 80,493 | 53,534 |
Investments purchased | (79,932) | (55,051) |
Additions to property and equipment | (197) | (3,777) |
Net cash provided by (used in) investing activities | 364 | (5,294) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payment for debt securities | 0 | (6,750) |
Payment of dividends on common stock | (412) | (422) |
Proceeds from shares issued under stock plans | 37 | 71 |
Purchase of shares for treasury | (360) | (2,440) |
Net cash used in financing activities | (735) | (9,541) |
Net decrease in cash and cash equivalents | (1,738) | (16,608) |
Cash and cash equivalents at beginning of period | 16,375 | 33,102 |
Cash and cash equivalents at end of period | 14,637 | 16,494 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Cash paid for interest | 1,063 | 1,296 |
Cash paid for income taxes | $ 1,165 | $ 442 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2015 | |
Basis of Presentation [Abstract] | |
Basis of Presentation | Note 1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements include the accounts of Atlantic American Corporation (the “Parent”) and its subsidiaries (collectively with the Parent, the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they do not include all of the information and notes required by GAAP for audited annual financial statements. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) considered necessary for a fair presentation have been included. The unaudited condensed consolidated financial statements included herein and these related notes should be read in conjunction with the Company’s consolidated financial statements, and the notes thereto, included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014 (the “2014 Annual Report”). The Company’s financial condition and results of operations as of and for the three month and nine month periods ended September 30, 2015 are not necessarily indicative of the financial condition or results of operations that may be expected for the year ending December 31, 2015 or for any other future period. The Company’s significant accounting policies have not changed materially from those set out in the Company’s 2014 Annual Report. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosures of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates. |
Recently Issued Accounting Stan
Recently Issued Accounting Standards | 9 Months Ended |
Sep. 30, 2015 | |
Recently Issued Accounting Standards [Abstract] | |
Recently Issued Accounting Standards | Note 2. In May 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2015-09, Disclosures about Short-Duration Contracts |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Segment Information [Abstract] | |
Segment Information | Note 3. The Company’s primary operating subsidiaries, American Southern Insurance Company and American Safety Insurance Company (together known as “American Southern”) and Bankers Fidelity Life Insurance Company and Bankers Fidelity Assurance Company (together known as “Bankers Fidelity”) operate in two principal business units, each focusing on specific products. American Southern operates in the property and casualty insurance market, while Bankers Fidelity operates in the life and health insurance market. Each business unit is managed independently and is evaluated on its individual performance. The following sets forth the revenue and income before income taxes for each business unit for the three month and nine month periods ended September 30, 2015 and 2014. Revenues Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 American Southern $ 14,899 $ 14,819 $ 45,335 $ 43,167 Bankers Fidelity 25,370 26,909 80,260 81,040 Corporate and Other 90 928 485 1,195 Total revenue $ 40,359 $ 42,656 $ 126,080 $ 125,402 Income Before Income Taxes Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 American Southern $ 1,572 $ 1,500 $ 5,245 $ 3,695 Bankers Fidelity 290 1,051 5,380 3,833 Corporate and Other (1,497 ) (964 ) (5,061 ) (3,962 ) Income before income taxes $ 365 $ 1,587 $ 5,564 $ 3,566 |
Junior Subordinated Debentures
Junior Subordinated Debentures | 9 Months Ended |
Sep. 30, 2015 | |
Junior Subordinated Debentures [Abstract] | |
Junior Subordinated Debentures | Note 4. The Company has two unconsolidated Connecticut statutory business trusts, which exist for the exclusive purposes of: (i) issuing trust preferred securities (“Trust Preferred Securities”) representing undivided beneficial interests in the assets of the trusts; (ii) investing the gross proceeds of the Trust Preferred Securities in junior subordinated deferrable interest debentures (“Junior Subordinated Debentures”) of Atlantic American; and (iii) engaging in those activities necessary or incidental thereto. The financial structure of each of Atlantic American Statutory Trust I and II as of September 30, 2015 was as follows: Atlantic American Statutory Trust I Atlantic American Statutory Trust II JUNIOR SUBORDINATED DEBENTURES (1) (2) Principal amount owed $ 18,042 $ 23,196 Balance September 30, 2015 $ 18,042 $ 23,196 Less: Treasury debt (3) - (7,500 ) Net balance September 30, 2015 $ 18,042 $ 15,696 Net balance December 31, 2014 $ 18,042 $ 15,696 Coupon rate LIBOR + 4.00% LIBOR + 4.10% Interest payable Quarterly Quarterly Maturity date December 4, 2032 May 15, 2033 Redeemable by issuer Yes Yes TRUST PREFERRED SECURITIES Issuance date December 4, 2002 May 15, 2003 Securities issued 17,500 22,500 Liquidation preference per security $ 1 $ 1 Liquidation value $ 17,500 $ 22,500 Coupon rate LIBOR + 4.00% LIBOR + 4.10% Distribution payable Quarterly Quarterly Distribution guaranteed by (4) Atlantic American Corporation Atlantic American Corporation (1) For each of the respective debentures, the Company has the right at any time, and from time to time, to defer payments of interest on the Junior Subordinated Debentures for a period not exceeding 20 consecutive quarters up to the debentures’ respective maturity dates. During any such period, interest will continue to accrue and the Company may not declare or pay any cash dividends or distributions on, or purchase, the Company’s common stock nor make any principal, interest or premium payments on or repurchase any debt securities that rank equally with or junior to the Junior Subordinated Debentures. The Company has the right at any time to dissolve each of the trusts and cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Preferred Securities. (2) The Junior Subordinated Debentures are unsecured and rank junior and subordinate in right of payment to all senior debt of the Parent and are effectively subordinated to all existing and future liabilities of its subsidiaries. (3) On August 4, 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. Consideration tendered, upon settlement, was $6,750 plus accrued interest resulting in a gain of $750 recognized in other income on the accompanying condensed consolidated statements of operations for the three month and nine month periods ended September 30, 2014. (4) The Parent has guaranteed, on a subordinated basis, all of the obligations under the Trust Preferred Securities, including payment of the redemption price and any accumulated and unpaid distributions to the extent of available funds and upon dissolution, winding up or liquidation. |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | Note 5. A reconciliation of the numerator and denominator used in the earnings per common share calculations is as follows: Three Months Ended September 30, 2015 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 238 20,589 Less preferred stock dividends (100 ) - Net income applicable to common shareholders $ 138 20,589 $ .01 Three Months Ended September 30, 2014 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 1,451 20,768 Less preferred stock dividends (117 ) - Net income applicable to common shareholders $ 1,334 20,768 $ .06 Nine Months Ended September 30, 2015 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 4,274 20,584 Less preferred stock dividends (299 ) - Net income applicable to common shareholders $ 3,975 20,584 $ .19 Nine Months Ended September 30, 2014 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 3,148 20,885 Less preferred stock dividends (353 ) - Net income applicable to common shareholders $ 2,795 20,885 $ .13 The assumed conversion of the Company’s Series D preferred stock was excluded from the earnings per common share calculation for all periods presented since its impact would have been antidilutive. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes [Abstract] | |
Income Taxes | Note 6. A reconciliation of the differences between income taxes computed at the federal statutory income tax rate and income tax expense is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Federal income tax provision at statutory rate of 35% $ 127 $ 555 $ 1,947 $ 1,248 Dividends-received deduction (21 ) (27 ) (75 ) (88 ) Small life insurance company deduction 51 (114 ) (572 ) (275 ) Other permanent differences 9 17 29 36 Change in asset valuation allowance due to change in judgment relating to realizability of deferred tax assets - (365 ) - (573 ) Adjustment for prior years’ estimates to actual (39 ) 70 (39 ) 70 Income tax expense $ 127 $ 136 $ 1,290 $ 418 The components of income tax expense were: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Current - Federal $ (532 ) $ (46 ) $ 587 $ 83 Deferred - Federal 659 547 703 908 Change in deferred tax asset valuation allowance - (365 ) - (573 ) Total $ 127 $ 136 $ 1,290 $ 418 The primary differences between the effective tax rate and the federal statutory income tax rate for the three month and nine month periods ended September 30, 2015 resulted from the dividends-received deduction (“DRD”) and the small life insurance company deduction (“SLD”). The current estimated DRD is adjusted as underlying factors change and can vary from estimates based on, but not limited to, actual distributions from investments as well as the amount of the Company’s taxable income. The SLD varies in amount and is determined at a rate of 60 percent of the tentative life insurance company taxable income (“LICTI”). The SLD for any taxable year is reduced (but not below zero) by 15 percent of the tentative LICTI for such taxable year as it exceeds $3,000 and is ultimately phased out at $15,000. The primary differences between the effective tax rate and the federal statutory income tax rate for the three month and nine month periods ended September 30, 2014 resulted from the DRD, the SLD and the change in deferred tax asset valuation allowance. The change in deferred tax asset valuation allowance was due to the utilization of certain capital loss carryforward benefits that had been previously reduced to zero through an existing valuation allowance reserve. All unused capital loss carryforwards expired at the end of 2014. The provision-to-filed return adjustments are generally updated at the completion of the third quarter of each fiscal year and were $39 and $70 in the three month and nine month periods ended September 30, 2015 and 2014, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 7. From time to time, the Company is, and expects to continue to be, involved in various claims and lawsuits incidental to and in the ordinary course of its businesses. In the opinion of management, any such known claims are not expected to have a material effect on the financial condition or results of operations of the Company. |
Investments
Investments | 9 Months Ended |
Sep. 30, 2015 | |
Investments [Abstract ] | |
Investments | Note 8. The following tables set forth the carrying value, gross unrealized gains, gross unrealized losses and amortized cost of the Company’s investments, aggregated by type and industry, as of September 30, 2015 and December 31, 2014. Investments were comprised of the following: September 30, 2015 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 30,782 $ 430 $ 243 $ 30,595 Obligations of states and political subdivisions 25,720 721 415 25,414 Corporate securities: Utilities and telecom 17,728 1,537 727 16,918 Financial services 51,108 2,167 1,149 50,090 Other business – diversified 63,014 944 4,066 66,136 Other consumer – diversified 23,014 183 1,024 23,855 Total corporate securities 154,864 4,831 6,966 156,999 Redeemable preferred stocks: Financial services 252 2 - 250 Other consumer – diversified 192 - - 192 Total redeemable preferred stocks 444 2 - 442 Total fixed maturities 211,810 5,984 7,624 213,450 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,305 341 - 964 Financial services 5,039 711 - 4,328 Other business – diversified 195 148 - 47 Other consumer – diversified 13,449 7,835 - 5,614 Total equity securities 19,988 9,035 - 10,953 Other invested assets 2,372 - - 2,372 Policy loans 2,181 - - 2,181 Real estate 38 - - 38 Investments in unconsolidated trusts 1,238 - - 1,238 Total investments $ 237,627 $ 15,019 $ 7,624 $ 230,232 December 31, 2014 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 33,898 $ 1,459 $ 30 $ 32,469 Obligations of states and political subdivisions 11,459 681 - 10,778 Corporate securities: Utilities and telecom 13,980 2,355 - 11,625 Financial services 59,224 3,404 588 56,408 Other business – diversified 70,139 2,076 1,830 69,893 Other consumer – diversified 25,388 332 547 25,603 Total corporate securities 168,731 8,167 2,965 163,529 Redeemable preferred stocks: Financial services 608 8 - 600 Other consumer – diversified 192 - - 192 Total redeemable preferred stocks 800 8 - 792 Total fixed maturities 214,888 10,315 2,995 207,568 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,403 439 - 964 Financial services 6,083 739 - 5,344 Other business – diversified 226 179 - 47 Other consumer – diversified 11,212 5,598 - 5,614 Total equity securities 18,924 6,955 - 11,969 Other invested assets 2,995 - - 2,995 Policy loans 2,202 - - 2,202 Real estate 38 - - 38 Investments in unconsolidated trusts 1,238 - - 1,238 Total investments $ 240,285 $ 17,270 $ 2,995 $ 226,010 The carrying value and amortized cost of the Company’s investments in fixed maturities at September 30, 2015 by contractual maturity were as follows. Actual maturities may differ from contractual maturities because issuers may call or prepay obligations with or without call or prepayment penalties. September 30, 2015 Carrying Value Amortized Cost Due in one year or less $ 4,186 $ 4,115 Due after one year through five years 20,023 19,593 Due after five years through ten years 94,107 96,140 Due after ten years 92,368 92,607 Varying maturities 1,126 995 Totals $ 211,810 $ 213,450 The following table sets forth the carrying value, amortized cost, and net unrealized gains (losses) of the Company’s investments aggregated by industry as of September 30, 2015 and December 31, 2014. September 30, 2015 December 31, 2014 Carrying Value Amortized Cost Unrealized Gains (Losses) Carrying Value Amortized Cost Unrealized Gains U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 30,782 $ 30,595 $ 187 $ 33,898 $ 32,469 $ 1,429 Obligations of states and political subdivisions 25,720 25,414 306 11,459 10,778 681 Utilities and telecom 19,033 17,882 1,151 15,383 12,589 2,794 Financial services 56,399 54,668 1,731 65,915 62,352 3,563 Other business – diversified 63,209 66,183 (2,974 ) 70,365 69,940 425 Other consumer – diversified 36,655 29,661 6,994 36,792 31,409 5,383 Other investments 5,829 5,829 - 6,473 6,473 - Investments $ 237,627 $ 230,232 $ 7,395 $ 240,285 $ 226,010 $ 14,275 The following tables present the Company’s unrealized loss aging for securities by type and length of time the security was in a continuous unrealized loss position as of September 30, 2015 and December 31, 2014. September 30, 2015 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 9,498 $ 242 $ 503 $ 1 $ 10,001 $ 243 Obligations of states and political subdivisions 13,237 415 - - 13,237 415 Corporate securities 69,731 3,496 14,644 3,470 84,375 6,966 Total temporarily impaired securities $ 92,466 $ 4,153 $ 15,147 $ 3,471 $ 107,613 $ 7,624 December 31, 2014 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 3,695 $ 7 $ 2,692 $ 23 $ 6,387 $ 30 Corporate securities 43,996 1,604 9,293 1,361 53,289 2,965 Total temporarily impaired securities $ 47,691 $ 1,611 $ 11,985 $ 1,384 $ 59,676 $ 2,995 The evaluation for an other than temporary impairment is a quantitative and qualitative process, which is subject to risks and uncertainties in the determination of whether declines in the fair value of investments are other than temporary. Potential risks and uncertainties include, among other things, changes in general economic conditions, an issuer’s financial condition or near term recovery prospects and the effects of changes in interest rates. In evaluating a potential impairment, the Company considers, among other factors, management’s intent and ability to hold the securities until price recovery, the nature of the investment and the expectation of prospects for the issuer and its industry, the status of an issuer’s continued satisfaction of its obligations in accordance with their contractual terms, and management’s expectation as to the issuer’s ability and intent to continue to do so, as well as ratings actions that may affect the issuer’s credit status. During the three month and nine month periods ended September 30, 2014, the Company recorded impairments related to the following investments. There were no impairments recorded during the three month or nine month periods ended September 30, 2015. Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Common and non-redeemable preferred stocks $ - $ 196 $ - $ 196 As of September 30, 2015, securities in an unrealized loss position primarily included certain of the Company’s investments in fixed maturities within the other diversified business, other diversified consumer, utilities and telecom and financial services sectors. Securities in an unrealized loss position reported in the other diversified business sector included gross unrealized losses of $2,582 related to investments in fixed maturities of 11 different issuers, all related to the oil and gas industry. The Company does not currently intend to sell nor does it expect to be required to sell any of the securities in an unrealized loss position. Based upon the Company’s expected continuation of receipt of contractually required principal and interest payments and its intent and ability to retain the securities until price recovery, as well as the Company’s evaluation of other relevant factors, including those described above, the Company has deemed these securities to be temporarily impaired as of September 30, 2015. The following describes the fair value hierarchy and provides information as to the extent to which the Company uses fair value to measure the value of its financial instruments and information about the inputs used to value those financial instruments. The fair value hierarchy prioritizes the inputs in the valuation techniques used to measure fair value into three broad levels. Level 1 Observable inputs that reflect quoted prices for identical assets or liabilities in active markets that the Company has the ability to access at the measurement date. The Company’s financial instruments valued using Level 1 criteria include cash equivalents and exchange traded common stocks. Level 2 Observable inputs, other than quoted prices included in Level 1, for an asset or liability or prices for similar assets or liabilities. The Company’s financial instruments valued using Level 2 criteria include significantly all of its fixed maturities, which consist of U.S. Treasury securities and U.S. Government securities, obligations of states and political subdivisions, and certain corporate fixed maturities, as well as its non-redeemable preferred stocks. In determining fair value measurements using Level 2 criteria, the Company utilizes various external pricing sources. Level 3 Valuations that are derived from techniques in which one or more of the significant inputs are unobservable (including assumptions about risk). Fair value is based on criteria that use assumptions or other data that are not readily observable from objective sources. The Company’s financial instruments valued using Level 3 criteria consist of a limited number of fixed maturities. As of September 30, 2015 and December 31, 2014, the value of the Company’s fixed maturities valued using Level 3 criteria was $2,241 and $2,214, respectively. The use of different criteria or assumptions regarding data may have yielded materially different valuations. As of September 30, 2015, financial instruments carried at fair value were measured on a recurring basis as summarized below: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Fixed maturities $ - $ 209,569 $ 2,241 $ 211,810 Equity securities 15,228 4,760 - 19,988 Cash equivalents 13,731 - - 13,731 Total $ 28,959 $ 214,329 $ 2,241 $ 245,529 As of December 31, 2014, financial instruments carried at fair value were measured on a recurring basis as summarized below: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Fixed maturities $ - $ 212,674 $ 2,214 $ 214,888 Equity securities 13,148 5,776 - 18,924 Cash equivalents 15,009 - - 15,009 Total $ 28,157 $ 218,450 $ 2,214 $ 248,821 The following is a roll-forward of the Company’s financial instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three month and nine month periods ended September 30, 2015. Fixed Maturities Balance, December 31, 2014 $ 2,214 Total unrealized gains included in other comprehensive income 50 Balance, March 31, 2015 2,264 Total unrealized losses included in other comprehensive loss (57 ) Balance, June 30, 2015 2,207 Total unrealized gains included in other comprehensive loss 34 Balance, September 30, 2015 $ 2,241 The Company’s fixed maturities valued using Level 3 inputs consist solely of issuances of pooled debt obligations of multiple, smaller financial services companies. They are not actively traded and valuation techniques used to measure fair value are based on future estimated cash flows (based on current cash flows) discounted at reasonable estimated rates of interest. There are no assumed prepayments and/or default probability assumptions as a majority of these instruments contain certain U.S. government agency strips to support the ultimate repayment of the principal. Other qualitative and quantitative information received from the original underwriter of the pooled offerings is also considered, as applicable. |
Fair Values of Financial Instru
Fair Values of Financial Instruments | 9 Months Ended |
Sep. 30, 2015 | |
Fair Values of Financial Instruments [Abstract] | |
Fair Values of Financial Instruments | Note 9. The estimated fair values have been determined by the Company using available market information from various market sources and appropriate valuation methodologies as of the respective dates. However, considerable judgment is necessary to interpret market data and to develop the estimates of fair value. Although management is not aware of any factors that would significantly affect the estimated fair value amounts, the estimates presented herein are not necessarily indicative of the amounts which the Company could realize in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. The following table sets forth the carrying amount, estimated fair value and level within the fair value hierarchy of the Company’s financial instruments as of September 30, 2015 and December 31, 2014. September 30, 2015 December 31, 2014 Level in Fair Value Hierarchy (1) Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Assets: Cash and cash equivalents Level 1 $ 14,637 $ 14,637 $ 16,375 $ 16,375 Fixed maturities (1) 211,810 211,810 214,888 214,888 Equity securities (1) 19,988 19,988 18,924 18,924 Other invested assets Level 3 2,372 2,372 2,995 2,995 Policy loans Level 2 2,181 2,181 2,202 2,202 Real estate Level 2 38 38 38 38 Investment in unconsolidated trusts Level 2 1,238 1,238 1,238 1,238 Liabilities: Junior Subordinated Debentures, net Level 2 33,738 33,738 33,738 33,738 (1) See Note 8 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 9 Months Ended |
Sep. 30, 2015 | |
Accumulated Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income | Note 10. The following table sets forth the balance of each component of accumulated other comprehensive income as of September 30, 2015 and December 31, 2014, and the changes in the balance of each component thereof during the nine month period ended September 30, 2015, net of taxes. Unrealized Gains on Available-for- Sale Securities Balance, December 31, 2014 $ 9,279 Other comprehensive loss before reclassifications (1,153 ) Amounts reclassified from accumulated other comprehensive income (3,319 ) Net current period other comprehensive loss (4,472 ) Balance, September 30, 2015 $ 4,807 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Segment Information [Abstract] | |
Revenue and income before income taxes for each business unit | The following sets forth the revenue and income before income taxes for each business unit for the three month and nine month periods ended September 30, 2015 and 2014. Revenues Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 American Southern $ 14,899 $ 14,819 $ 45,335 $ 43,167 Bankers Fidelity 25,370 26,909 80,260 81,040 Corporate and Other 90 928 485 1,195 Total revenue $ 40,359 $ 42,656 $ 126,080 $ 125,402 Income Before Income Taxes Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 American Southern $ 1,572 $ 1,500 $ 5,245 $ 3,695 Bankers Fidelity 290 1,051 5,380 3,833 Corporate and Other (1,497 ) (964 ) (5,061 ) (3,962 ) Income before income taxes $ 365 $ 1,587 $ 5,564 $ 3,566 |
Junior Subordinated Debentures
Junior Subordinated Debentures (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Junior Subordinated Debentures [Abstract] | |
Financial structure of statutory business trusts | The financial structure of each of Atlantic American Statutory Trust I and II as of September 30, 2015 was as follows: Atlantic American Statutory Trust I Atlantic American Statutory Trust II JUNIOR SUBORDINATED DEBENTURES (1) (2) Principal amount owed $ 18,042 $ 23,196 Balance September 30, 2015 $ 18,042 $ 23,196 Less: Treasury debt (3) - (7,500 ) Net balance September 30, 2015 $ 18,042 $ 15,696 Net balance December 31, 2014 $ 18,042 $ 15,696 Coupon rate LIBOR + 4.00% LIBOR + 4.10% Interest payable Quarterly Quarterly Maturity date December 4, 2032 May 15, 2033 Redeemable by issuer Yes Yes TRUST PREFERRED SECURITIES Issuance date December 4, 2002 May 15, 2003 Securities issued 17,500 22,500 Liquidation preference per security $ 1 $ 1 Liquidation value $ 17,500 $ 22,500 Coupon rate LIBOR + 4.00% LIBOR + 4.10% Distribution payable Quarterly Quarterly Distribution guaranteed by (4) Atlantic American Corporation Atlantic American Corporation (1) For each of the respective debentures, the Company has the right at any time, and from time to time, to defer payments of interest on the Junior Subordinated Debentures for a period not exceeding 20 consecutive quarters up to the debentures’ respective maturity dates. During any such period, interest will continue to accrue and the Company may not declare or pay any cash dividends or distributions on, or purchase, the Company’s common stock nor make any principal, interest or premium payments on or repurchase any debt securities that rank equally with or junior to the Junior Subordinated Debentures. The Company has the right at any time to dissolve each of the trusts and cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Preferred Securities. (2) The Junior Subordinated Debentures are unsecured and rank junior and subordinate in right of payment to all senior debt of the Parent and are effectively subordinated to all existing and future liabilities of its subsidiaries. (3) On August 4, 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. Consideration tendered, upon settlement, was $6,750 plus accrued interest resulting in a gain of $750 recognized in other income on the accompanying condensed consolidated statements of operations for the three month and nine month periods ended September 30, 2014. (4) The Parent has guaranteed, on a subordinated basis, all of the obligations under the Trust Preferred Securities, including payment of the redemption price and any accumulated and unpaid distributions to the extent of available funds and upon dissolution, winding up or liquidation. |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Earnings Per Common Share [Abstract] | |
Reconciliation of numerator and denominator used in earnings per common share calculations | A reconciliation of the numerator and denominator used in the earnings per common share calculations is as follows: Three Months Ended September 30, 2015 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 238 20,589 Less preferred stock dividends (100 ) - Net income applicable to common shareholders $ 138 20,589 $ .01 Three Months Ended September 30, 2014 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 1,451 20,768 Less preferred stock dividends (117 ) - Net income applicable to common shareholders $ 1,334 20,768 $ .06 Nine Months Ended September 30, 2015 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 4,274 20,584 Less preferred stock dividends (299 ) - Net income applicable to common shareholders $ 3,975 20,584 $ .19 Nine Months Ended September 30, 2014 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share: Net income $ 3,148 20,885 Less preferred stock dividends (353 ) - Net income applicable to common shareholders $ 2,795 20,885 $ .13 |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes [Abstract] | |
Reconciliation of income tax expense | A reconciliation of the differences between income taxes computed at the federal statutory income tax rate and income tax expense is as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Federal income tax provision at statutory rate of 35% $ 127 $ 555 $ 1,947 $ 1,248 Dividends-received deduction (21 ) (27 ) (75 ) (88 ) Small life insurance company deduction 51 (114 ) (572 ) (275 ) Other permanent differences 9 17 29 36 Change in asset valuation allowance due to change in judgment relating to realizability of deferred tax assets - (365 ) - (573 ) Adjustment for prior years’ estimates to actual (39 ) 70 (39 ) 70 Income tax expense $ 127 $ 136 $ 1,290 $ 418 |
Components of income tax expense | The components of income tax expense were: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Current - Federal $ (532 ) $ (46 ) $ 587 $ 83 Deferred - Federal 659 547 703 908 Change in deferred tax asset valuation allowance - (365 ) - (573 ) Total $ 127 $ 136 $ 1,290 $ 418 |
Investments (Tables)
Investments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Investments [Abstract ] | |
Schedule of investments aggregated by type and industry | Investments were comprised of the following: September 30, 2015 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 30,782 $ 430 $ 243 $ 30,595 Obligations of states and political subdivisions 25,720 721 415 25,414 Corporate securities: Utilities and telecom 17,728 1,537 727 16,918 Financial services 51,108 2,167 1,149 50,090 Other business – diversified 63,014 944 4,066 66,136 Other consumer – diversified 23,014 183 1,024 23,855 Total corporate securities 154,864 4,831 6,966 156,999 Redeemable preferred stocks: Financial services 252 2 - 250 Other consumer – diversified 192 - - 192 Total redeemable preferred stocks 444 2 - 442 Total fixed maturities 211,810 5,984 7,624 213,450 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,305 341 - 964 Financial services 5,039 711 - 4,328 Other business – diversified 195 148 - 47 Other consumer – diversified 13,449 7,835 - 5,614 Total equity securities 19,988 9,035 - 10,953 Other invested assets 2,372 - - 2,372 Policy loans 2,181 - - 2,181 Real estate 38 - - 38 Investments in unconsolidated trusts 1,238 - - 1,238 Total investments $ 237,627 $ 15,019 $ 7,624 $ 230,232 December 31, 2014 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 33,898 $ 1,459 $ 30 $ 32,469 Obligations of states and political subdivisions 11,459 681 - 10,778 Corporate securities: Utilities and telecom 13,980 2,355 - 11,625 Financial services 59,224 3,404 588 56,408 Other business – diversified 70,139 2,076 1,830 69,893 Other consumer – diversified 25,388 332 547 25,603 Total corporate securities 168,731 8,167 2,965 163,529 Redeemable preferred stocks: Financial services 608 8 - 600 Other consumer – diversified 192 - - 192 Total redeemable preferred stocks 800 8 - 792 Total fixed maturities 214,888 10,315 2,995 207,568 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,403 439 - 964 Financial services 6,083 739 - 5,344 Other business – diversified 226 179 - 47 Other consumer – diversified 11,212 5,598 - 5,614 Total equity securities 18,924 6,955 - 11,969 Other invested assets 2,995 - - 2,995 Policy loans 2,202 - - 2,202 Real estate 38 - - 38 Investments in unconsolidated trusts 1,238 - - 1,238 Total investments $ 240,285 $ 17,270 $ 2,995 $ 226,010 |
Amortized cost and carrying value of fixed maturities by contractual maturity | The carrying value and amortized cost of the Company’s investments in fixed maturities at September 30, 2015 by contractual maturity were as follows. Actual maturities may differ from contractual maturities because issuers may call or prepay obligations with or without call or prepayment penalties. September 30, 2015 Carrying Value Amortized Cost Due in one year or less $ 4,186 $ 4,115 Due after one year through five years 20,023 19,593 Due after five years through ten years 94,107 96,140 Due after ten years 92,368 92,607 Varying maturities 1,126 995 Totals $ 211,810 $ 213,450 |
Schedule of investments aggregated by industry | The following table sets forth the carrying value, amortized cost, and net unrealized gains (losses) of the Company’s investments aggregated by industry as of September 30, 2015 and December 31, 2014. September 30, 2015 December 31, 2014 Carrying Value Amortized Cost Unrealized Gains (Losses) Carrying Value Amortized Cost Unrealized Gains U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 30,782 $ 30,595 $ 187 $ 33,898 $ 32,469 $ 1,429 Obligations of states and political subdivisions 25,720 25,414 306 11,459 10,778 681 Utilities and telecom 19,033 17,882 1,151 15,383 12,589 2,794 Financial services 56,399 54,668 1,731 65,915 62,352 3,563 Other business – diversified 63,209 66,183 (2,974 ) 70,365 69,940 425 Other consumer – diversified 36,655 29,661 6,994 36,792 31,409 5,383 Other investments 5,829 5,829 - 6,473 6,473 - Investments $ 237,627 $ 230,232 $ 7,395 $ 240,285 $ 226,010 $ 14,275 |
Schedule of investment securities with continuous unrealized loss position | The following tables present the Company’s unrealized loss aging for securities by type and length of time the security was in a continuous unrealized loss position as of September 30, 2015 and December 31, 2014. September 30, 2015 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 9,498 $ 242 $ 503 $ 1 $ 10,001 $ 243 Obligations of states and political subdivisions 13,237 415 - - 13,237 415 Corporate securities 69,731 3,496 14,644 3,470 84,375 6,966 Total temporarily impaired securities $ 92,466 $ 4,153 $ 15,147 $ 3,471 $ 107,613 $ 7,624 December 31, 2014 Less than 12 months 12 months or longer Total Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 3,695 $ 7 $ 2,692 $ 23 $ 6,387 $ 30 Corporate securities 43,996 1,604 9,293 1,361 53,289 2,965 Total temporarily impaired securities $ 47,691 $ 1,611 $ 11,985 $ 1,384 $ 59,676 $ 2,995 |
Schedule of other than temporary impairments | During the three month and nine month periods ended September 30, 2014, the Company recorded impairments related to the following investments. There were no impairments recorded during the three month or nine month periods ended September 30, 2015. Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Common and non-redeemable preferred stocks $ - $ 196 $ - $ 196 |
Financial instruments carried at fair value measured on a recurring basis | As of September 30, 2015, financial instruments carried at fair value were measured on a recurring basis as summarized below: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets Fixed maturities $ - $ 209,569 $ 2,241 $ 211,810 Equity securities 15,228 4,760 - 19,988 Cash equivalents 13,731 - - 13,731 Total $ 28,959 $ 214,329 $ 2,241 $ 245,529 As of December 31, 2014, financial instruments carried at fair value were measured on a recurring basis as summarized below: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Assets: Fixed maturities $ - $ 212,674 $ 2,214 $ 214,888 Equity securities 13,148 5,776 - 18,924 Cash equivalents 15,009 - - 15,009 Total $ 28,157 $ 218,450 $ 2,214 $ 248,821 |
Roll-forward of financial instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) | The following is a roll-forward of the Company’s financial instruments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the three month and nine month periods ended September 30, 2015. Fixed Maturities Balance, December 31, 2014 $ 2,214 Total unrealized gains included in other comprehensive income 50 Balance, March 31, 2015 2,264 Total unrealized losses included in other comprehensive loss (57 ) Balance, June 30, 2015 2,207 Total unrealized gains included in other comprehensive loss 34 Balance, September 30, 2015 $ 2,241 |
Fair Values of Financial Inst23
Fair Values of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Fair Values of Financial Instruments [Abstract] | |
Carrying amount, estimated fair value and level within the fair value hierarchy of financial instruments | The following table sets forth the carrying amount, estimated fair value and level within the fair value hierarchy of the Company’s financial instruments as of September 30, 2015 and December 31, 2014. September 30, 2015 December 31, 2014 Level in Fair Value Hierarchy (1) Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Assets: Cash and cash equivalents Level 1 $ 14,637 $ 14,637 $ 16,375 $ 16,375 Fixed maturities (1) 211,810 211,810 214,888 214,888 Equity securities (1) 19,988 19,988 18,924 18,924 Other invested assets Level 3 2,372 2,372 2,995 2,995 Policy loans Level 2 2,181 2,181 2,202 2,202 Real estate Level 2 38 38 38 38 Investment in unconsolidated trusts Level 2 1,238 1,238 1,238 1,238 Liabilities: Junior Subordinated Debentures, net Level 2 33,738 33,738 33,738 33,738 (1) See Note 8 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. |
Accumulated Other Comprehensi24
Accumulated Other Comprehensive Income (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accumulated Other Comprehensive Income [Abstract] | |
Changes in balances of each component of accumulated other comprehensive income, net of taxes | The following table sets forth the balance of each component of accumulated other comprehensive income as of September 30, 2015 and December 31, 2014, and the changes in the balance of each component thereof during the nine month period ended September 30, 2015, net of taxes. Unrealized Gains on Available-for- Sale Securities Balance, December 31, 2014 $ 9,279 Other comprehensive loss before reclassifications (1,153 ) Amounts reclassified from accumulated other comprehensive income (3,319 ) Net current period other comprehensive loss (4,472 ) Balance, September 30, 2015 $ 4,807 |
Segment Information (Details)
Segment Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Segment | Sep. 30, 2014USD ($) | |
Segment Information [Abstract] | ||||
Number of business units | Segment | 2 | |||
Revenue and income before income taxes for each business unit [Abstract] | ||||
Total revenue | $ 40,359 | $ 42,656 | $ 126,080 | $ 125,402 |
Income before income taxes | 365 | 1,587 | 5,564 | 3,566 |
Corporate and Other [Member] | ||||
Revenue and income before income taxes for each business unit [Abstract] | ||||
Total revenue | 90 | 928 | 485 | 1,195 |
Income before income taxes | (1,497) | (964) | (5,061) | (3,962) |
American Southern [Member] | Operating Segments [Member] | ||||
Revenue and income before income taxes for each business unit [Abstract] | ||||
Total revenue | 14,899 | 14,819 | 45,335 | 43,167 |
Income before income taxes | 1,572 | 1,500 | 5,245 | 3,695 |
Bankers Fidelity [Member] | Operating Segments [Member] | ||||
Revenue and income before income taxes for each business unit [Abstract] | ||||
Total revenue | 25,370 | 26,909 | 80,260 | 81,040 |
Income before income taxes | $ 290 | $ 1,051 | $ 5,380 | $ 3,833 |
Junior Subordinated Debenture26
Junior Subordinated Debentures (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)TrustQuarter$ / sharesshares | Sep. 30, 2014USD ($) | ||
Debt Instrument [Line Items] | ||||
Number of Connecticut statutory business trusts | Trust | 2 | |||
Financial structure of statutory business trusts [Abstract] | ||||
Net balance September 30, 2015 | $ 33,738 | |||
Net balance December 31, 2014 | 33,738 | |||
Consideration tendered upon settlement of Junior Subordinated Debentures | 0 | $ 6,750 | ||
Gain on settlement of Junior Subordinated Debentures | $ 0 | 750 | ||
Junior Subordinated Debentures [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Number of consecutive quarters for which interest payments can be deferred | Quarter | 20 | |||
Atlantic American Statutory Trust I [Member] | Junior Subordinated Debentures [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Principal amount owed | [1],[2] | $ 18,042 | ||
Balance September 30, 2015 | [1],[2] | 18,042 | ||
Less: Treasury debt | [1],[2],[3] | 0 | ||
Net balance September 30, 2015 | [1],[2] | 18,042 | ||
Net balance December 31, 2014 | [1],[2] | $ 18,042 | ||
Coupon rate | [1],[2] | LIBOR + 4.00% | ||
Interest payable | [1],[2] | Quarterly | ||
Maturity date | [1],[2] | Dec. 4, 2032 | ||
Redeemable by issuer | [1],[2] | Yes | ||
Atlantic American Statutory Trust I [Member] | Junior Subordinated Debentures [Member] | LIBOR [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Basis spread on variable rate | 4.00% | |||
Atlantic American Statutory Trust I [Member] | Trust Preferred Securities [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Coupon rate | LIBOR + 4.00% | |||
Issuance date | Dec. 4, 2002 | |||
Securities issued (in shares) | shares | 17,500 | |||
Liquidation preference per security (in dollars per share) | $ / shares | $ 1 | |||
Liquidation value | $ 17,500 | |||
Distribution payable | Quarterly | |||
Distribution guaranteed by | [4] | Atlantic American Corporation | ||
Atlantic American Statutory Trust I [Member] | Trust Preferred Securities [Member] | LIBOR [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Basis spread on variable rate | 4.00% | |||
Atlantic American Statutory Trust II [Member] | Junior Subordinated Debentures [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Principal amount owed | [1],[2] | $ 23,196 | ||
Balance September 30, 2015 | [1],[2] | 23,196 | ||
Less: Treasury debt | [1],[2],[3] | (7,500) | ||
Net balance September 30, 2015 | [1],[2] | 15,696 | ||
Net balance December 31, 2014 | [1],[2] | $ 15,696 | ||
Coupon rate | [1],[2] | LIBOR + 4.10% | ||
Interest payable | [1],[2] | Quarterly | ||
Maturity date | [1],[2] | May 15, 2033 | ||
Redeemable by issuer | [1],[2] | Yes | ||
Consideration tendered upon settlement of Junior Subordinated Debentures | 6,750 | |||
Gain on settlement of Junior Subordinated Debentures | $ 750 | $ 750 | ||
Atlantic American Statutory Trust II [Member] | Junior Subordinated Debentures [Member] | LIBOR [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Basis spread on variable rate | 4.10% | |||
Atlantic American Statutory Trust II [Member] | Trust Preferred Securities [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Coupon rate | LIBOR + 4.10% | |||
Issuance date | May 15, 2003 | |||
Securities issued (in shares) | shares | 22,500 | |||
Liquidation preference per security (in dollars per share) | $ / shares | $ 1 | |||
Liquidation value | $ 22,500 | |||
Distribution payable | Quarterly | |||
Distribution guaranteed by | [4] | Atlantic American Corporation | ||
Atlantic American Statutory Trust II [Member] | Trust Preferred Securities [Member] | LIBOR [Member] | ||||
Financial structure of statutory business trusts [Abstract] | ||||
Basis spread on variable rate | 4.10% | |||
[1] | For each of the respective debentures, the Company has the right at any time, and from time to time, to defer payments of interest on the Junior Subordinated Debentures for a period not exceeding 20 consecutive quarters up to the debentures' respective maturity dates. During any such period, interest will continue to accrue and the Company may not declare or pay any cash dividends or distributions on, or purchase, the Company's common stock nor make any principal, interest or premium payments on or repurchase any debt securities that rank equally with or junior to the Junior Subordinated Debentures. The Company has the right at any time to dissolve each of the trusts and cause the Junior Subordinated Debentures to be distributed to the holders of the Trust Preferred Securities. | |||
[2] | The Junior Subordinated Debentures are unsecured and rank junior and subordinate in right of payment to all senior debt of the Parent and are effectively subordinated to all existing and future liabilities of its subsidiaries. | |||
[3] | On August 4, 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. Consideration tendered, upon settlement, was $6,750 plus accrued interest resulting in a gain of $750 recognized in other income on the accompanying condensed consolidated statements of operations for the three month and nine month periods ended September 30, 2014. | |||
[4] | The Parent has guaranteed, on a subordinated basis, all of the obligations under the Trust Preferred Securities, including payment of the redemption price and any accumulated and unpaid distributions to the extent of available funds and upon dissolution, winding up or liquidation. |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income [Abstract] | ||||
Net income | $ 238 | $ 1,451 | $ 4,274 | $ 3,148 |
Less preferred stock dividends | (100) | (117) | (299) | (353) |
Net income applicable to common shareholders | $ 138 | $ 1,334 | $ 3,975 | $ 2,795 |
Shares [Abstract] | ||||
Weighted average shares outstanding (in shares) | 20,589 | 20,768 | 20,584 | 20,885 |
Per Share Amount [Abstract] | ||||
Net income applicable to common shareholders (in dollars per share) | $ 0.01 | $ 0.06 | $ 0.19 | $ 0.13 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Reconciliation of income tax (benefit) expense [Abstract] | ||||
Federal income tax provision at statutory rate of 35% | $ 127 | $ 555 | $ 1,947 | $ 1,248 |
Dividends-received deduction | (21) | (27) | (75) | (88) |
Small life insurance company deduction | 51 | (114) | (572) | (275) |
Other permanent differences | 9 | 17 | 29 | 36 |
Change in asset valuation allowance due to change in judgment relating to realizability of deferred tax assets | 0 | (365) | 0 | (573) |
Adjustment for prior years' estimates to actual | (39) | 70 | (39) | 70 |
Income tax expense | 127 | 136 | $ 1,290 | 418 |
Federal statutory income tax rate | 35.00% | |||
Components of income tax expense [Abstract] | ||||
Current - Federal | (532) | (46) | $ 587 | 83 |
Deferred - Federal | 659 | 547 | 703 | 908 |
Change in deferred tax asset valuation allowance | 0 | (365) | 0 | (573) |
Income tax expense | 127 | $ 136 | $ 1,290 | $ 418 |
SLD as percentage of life insurance company taxable income | 60.00% | |||
Percentage of reduction in SLD | 15.00% | |||
Minimum tentative amount of LICTI | 3,000 | $ 3,000 | ||
Maximum tentative amount of LICTI | $ 15,000 | $ 15,000 |
Investments (Details)
Investments (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015USD ($)Issuer | Dec. 31, 2014USD ($) | |
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | $ 237,627 | $ 240,285 |
Gross Unrealized Gains | 15,019 | 17,270 |
Gross Unrealized Losses | 7,624 | 2,995 |
Amortized Cost | $ 230,232 | 226,010 |
Fixed maturity investments, number of issuers | Issuer | 11 | |
U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | $ 30,782 | 33,898 |
Amortized Cost | 30,595 | 32,469 |
Obligations of States and Political Subdivisions [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 25,720 | 11,459 |
Amortized Cost | 25,414 | 10,778 |
Utilities and Telecom [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 19,033 | 15,383 |
Amortized Cost | 17,882 | 12,589 |
Financial Services [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 56,399 | 65,915 |
Amortized Cost | 54,668 | 62,352 |
Other Business - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 63,209 | 70,365 |
Amortized Cost | 66,183 | 69,940 |
Other Consumer - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 36,655 | 36,792 |
Amortized Cost | 29,661 | 31,409 |
Fixed Maturities [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 211,810 | 214,888 |
Gross Unrealized Gains | 5,984 | 10,315 |
Gross Unrealized Losses | 7,624 | 2,995 |
Amortized Cost | 213,450 | 207,568 |
Fixed Maturities [Member] | Oil and Gas Properties [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Gross Unrealized Losses | 2,582 | |
Fixed Maturities [Member] | Bonds [Member] | U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 30,782 | 33,898 |
Gross Unrealized Gains | 430 | 1,459 |
Gross Unrealized Losses | 243 | 30 |
Amortized Cost | 30,595 | 32,469 |
Fixed Maturities [Member] | Bonds [Member] | Obligations of States and Political Subdivisions [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 25,720 | 11,459 |
Gross Unrealized Gains | 721 | 681 |
Gross Unrealized Losses | 415 | 0 |
Amortized Cost | 25,414 | 10,778 |
Fixed Maturities [Member] | Corporate Securities [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 154,864 | 168,731 |
Gross Unrealized Gains | 4,831 | 8,167 |
Gross Unrealized Losses | 6,966 | 2,965 |
Amortized Cost | 156,999 | 163,529 |
Fixed Maturities [Member] | Corporate Securities [Member] | Utilities and Telecom [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 17,728 | 13,980 |
Gross Unrealized Gains | 1,537 | 2,355 |
Gross Unrealized Losses | 727 | 0 |
Amortized Cost | 16,918 | 11,625 |
Fixed Maturities [Member] | Corporate Securities [Member] | Financial Services [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 51,108 | 59,224 |
Gross Unrealized Gains | 2,167 | 3,404 |
Gross Unrealized Losses | 1,149 | 588 |
Amortized Cost | 50,090 | 56,408 |
Fixed Maturities [Member] | Corporate Securities [Member] | Other Business - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 63,014 | 70,139 |
Gross Unrealized Gains | 944 | 2,076 |
Gross Unrealized Losses | 4,066 | 1,830 |
Amortized Cost | 66,136 | 69,893 |
Fixed Maturities [Member] | Corporate Securities [Member] | Other Consumer - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 23,014 | 25,388 |
Gross Unrealized Gains | 183 | 332 |
Gross Unrealized Losses | 1,024 | 547 |
Amortized Cost | 23,855 | 25,603 |
Fixed Maturities [Member] | Redeemable Preferred Stocks [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 444 | 800 |
Gross Unrealized Gains | 2 | 8 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 442 | 792 |
Fixed Maturities [Member] | Redeemable Preferred Stocks [Member] | Financial Services [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 252 | 608 |
Gross Unrealized Gains | 2 | 8 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 250 | 600 |
Fixed Maturities [Member] | Redeemable Preferred Stocks [Member] | Other Consumer - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 192 | 192 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 192 | 192 |
Equity Securities [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 19,988 | 18,924 |
Gross Unrealized Gains | 9,035 | 6,955 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 10,953 | 11,969 |
Equity Securities [Member] | Common and Non-Redeemable Preferred Stocks [Member] | Utilities and Telecom [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 1,305 | 1,403 |
Gross Unrealized Gains | 341 | 439 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 964 | 964 |
Equity Securities [Member] | Common and Non-Redeemable Preferred Stocks [Member] | Financial Services [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 5,039 | 6,083 |
Gross Unrealized Gains | 711 | 739 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 4,328 | 5,344 |
Equity Securities [Member] | Common and Non-Redeemable Preferred Stocks [Member] | Other Business - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 195 | 226 |
Gross Unrealized Gains | 148 | 179 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 47 | 47 |
Equity Securities [Member] | Common and Non-Redeemable Preferred Stocks [Member] | Other Consumer - Diversified [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 13,449 | 11,212 |
Gross Unrealized Gains | 7,835 | 5,598 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 5,614 | 5,614 |
Other Invested Assets [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 2,372 | 2,995 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 2,372 | 2,995 |
Policy Loans [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 2,181 | 2,202 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 2,181 | 2,202 |
Real Estate [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 38 | 38 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | 38 | 38 |
Investments in Unconsolidated Trusts [Member] | ||
Schedule of investments aggregated by type and industry [Abstract] | ||
Carrying Value | 1,238 | 1,238 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | 0 | 0 |
Amortized Cost | $ 1,238 | $ 1,238 |
Investments, Part II (Details)
Investments, Part II (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Carrying Value [Abstract] | ||
Due in one year or less | $ 4,186 | |
Due after one year through five years | 20,023 | |
Due after five years through ten years | 94,107 | |
Due after ten years | 92,368 | |
Varying maturities | 1,126 | |
Totals | 211,810 | $ 214,888 |
Amortized Cost [Abstract] | ||
Due in one year or less | 4,115 | |
Due after one year through five years | 19,593 | |
Due after five years through ten years | 96,140 | |
Due after ten years | 92,607 | |
Varying maturities | 995 | |
Totals | $ 213,450 | $ 207,568 |
Investments, Part III (Details)
Investments, Part III (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | $ 237,627 | $ 237,627 | $ 240,285 | ||
Amortized Cost | 230,232 | 230,232 | 226,010 | ||
Unrealized Gains (Losses) | 7,395 | 7,395 | 14,275 | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | |||||
Less than 12 months | 92,466 | 92,466 | 47,691 | ||
12 months or longer | 15,147 | 15,147 | 11,985 | ||
Total | 107,613 | 107,613 | 59,676 | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract] | |||||
Less than 12 months | 4,153 | 4,153 | 1,611 | ||
12 months or longer | 3,471 | 3,471 | 1,384 | ||
Total | 7,624 | 7,624 | 2,995 | ||
U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 30,782 | 30,782 | 33,898 | ||
Amortized Cost | 30,595 | 30,595 | 32,469 | ||
Unrealized Gains (Losses) | 187 | 187 | 1,429 | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | |||||
Less than 12 months | 9,498 | 9,498 | 3,695 | ||
12 months or longer | 503 | 503 | 2,692 | ||
Total | 10,001 | 10,001 | 6,387 | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract] | |||||
Less than 12 months | 242 | 242 | 7 | ||
12 months or longer | 1 | 1 | 23 | ||
Total | 243 | 243 | 30 | ||
Obligations of States and Political Subdivisions [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 25,720 | 25,720 | 11,459 | ||
Amortized Cost | 25,414 | 25,414 | 10,778 | ||
Unrealized Gains (Losses) | 306 | 306 | 681 | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | |||||
Less than 12 months | 13,237 | 13,237 | |||
12 months or longer | 0 | 0 | |||
Total | 13,237 | 13,237 | |||
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract] | |||||
Less than 12 months | 415 | 415 | |||
12 months or longer | 0 | 0 | |||
Total | 415 | 415 | |||
Utilities and Telecom [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 19,033 | 19,033 | 15,383 | ||
Amortized Cost | 17,882 | 17,882 | 12,589 | ||
Unrealized Gains (Losses) | 1,151 | 1,151 | 2,794 | ||
Financial Services [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 56,399 | 56,399 | 65,915 | ||
Amortized Cost | 54,668 | 54,668 | 62,352 | ||
Unrealized Gains (Losses) | 1,731 | 1,731 | 3,563 | ||
Other Business - Diversified [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 63,209 | 63,209 | 70,365 | ||
Amortized Cost | 66,183 | 66,183 | 69,940 | ||
Unrealized Gains (Losses) | (2,974) | (2,974) | 425 | ||
Other Consumer - Diversified [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 36,655 | 36,655 | 36,792 | ||
Amortized Cost | 29,661 | 29,661 | 31,409 | ||
Unrealized Gains (Losses) | 6,994 | 6,994 | 5,383 | ||
Other Investment [Member] | |||||
Schedule of investments aggregated by industry [Abstract] | |||||
Carrying Value | 5,829 | 5,829 | 6,473 | ||
Amortized Cost | 5,829 | 5,829 | 6,473 | ||
Unrealized Gains (Losses) | 0 | 0 | 0 | ||
Corporate Securities [Member] | |||||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | |||||
Less than 12 months | 69,731 | 69,731 | 43,996 | ||
12 months or longer | 14,644 | 14,644 | 9,293 | ||
Total | 84,375 | 84,375 | 53,289 | ||
Available-for-sale Securities, Continuous Unrealized Loss Position, Unrealized Losses [Abstract] | |||||
Less than 12 months | 3,496 | 3,496 | 1,604 | ||
12 months or longer | 3,470 | 3,470 | 1,361 | ||
Total | 6,966 | 6,966 | $ 2,965 | ||
Common and Non-Redeemable Preferred Stocks [Member] | |||||
Schedule of Other Than Temporary Impairments [Abstract] | |||||
Investment impairments | $ 0 | $ 196 | $ 0 | $ 196 |
Investments, Part IV (Details)
Investments, Part IV (Details) - Recurring [Member] - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | $ 245,529 | $ 248,821 |
Fixed Maturities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 211,810 | 214,888 |
Equity Securities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 19,988 | 18,924 |
Cash Equivalents [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 13,731 | 15,009 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 28,959 | 28,157 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Fixed Maturities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Equity Securities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 15,228 | 13,148 |
Quoted Prices in Active Markets for Identical Assets (Level 1) [Member] | Cash Equivalents [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 13,731 | 15,009 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 214,329 | 218,450 |
Significant Other Observable Inputs (Level 2) [Member] | Fixed Maturities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 209,569 | 212,674 |
Significant Other Observable Inputs (Level 2) [Member] | Equity Securities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 4,760 | 5,776 |
Significant Other Observable Inputs (Level 2) [Member] | Cash Equivalents [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 2,241 | 2,214 |
Significant Unobservable Inputs (Level 3) [Member] | Fixed Maturities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 2,241 | 2,214 |
Significant Unobservable Inputs (Level 3) [Member] | Equity Securities [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | Cash Equivalents [Member] | ||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | ||
Assets at fair value | $ 0 | $ 0 |
Investments, Part V (Details)
Investments, Part V (Details) - Fixed Maturities [Member] - USD ($) $ in Thousands | 3 Months Ended | ||
Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | |
Assets measured at fair value on a recurring basis [Abstract] | |||
Balance, beginning of period | $ 2,207 | $ 2,264 | $ 2,214 |
Total unrealized gains (losses) included in other comprehensive income (loss) | 34 | (57) | 50 |
Balance, end of period | $ 2,241 | $ 2,207 | $ 2,264 |
Fair Values of Financial Inst34
Fair Values of Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 | |
Carrying Amount [Member] | |||
Assets [Abstract] | |||
Fixed maturities | [1] | $ 211,810 | $ 214,888 |
Equity securities | [1] | 19,988 | 18,924 |
Carrying Amount [Member] | Level 1 [Member] | |||
Assets [Abstract] | |||
Cash and cash equivalents | 14,637 | 16,375 | |
Carrying Amount [Member] | Level 2 [Member] | |||
Assets [Abstract] | |||
Policy loans | 2,181 | 2,202 | |
Real estate | 38 | 38 | |
Investment in unconsolidated trusts | 1,238 | 1,238 | |
Liabilities [Abstract] | |||
Junior subordinated debentures, net | 33,738 | 33,738 | |
Carrying Amount [Member] | Level 3 [Member] | |||
Assets [Abstract] | |||
Other invested assets | 2,372 | 2,995 | |
Estimated Fair Value [Member] | |||
Assets [Abstract] | |||
Fixed maturities | [1] | 211,810 | 214,888 |
Equity securities | [1] | 19,988 | 18,924 |
Estimated Fair Value [Member] | Level 1 [Member] | |||
Assets [Abstract] | |||
Cash and cash equivalents | 14,637 | 16,375 | |
Estimated Fair Value [Member] | Level 2 [Member] | |||
Assets [Abstract] | |||
Policy loans | 2,181 | 2,202 | |
Real estate | 38 | 38 | |
Investment in unconsolidated trusts | 1,238 | 1,238 | |
Liabilities [Abstract] | |||
Junior subordinated debentures, net | 33,738 | 33,738 | |
Estimated Fair Value [Member] | Level 3 [Member] | |||
Assets [Abstract] | |||
Other invested assets | $ 2,372 | $ 2,995 | |
[1] | See Note 8 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. |
Accumulated Other Comprehensi35
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Changes in balances of each component of accumulated other comprehensive income, net of taxes [Roll Forward] | ||
Beginning balance | $ 9,279 | |
Net current period other comprehensive loss | (4,472) | $ 771 |
Ending balance | 4,807 | |
AOCI Attributable to Parent [Member] | ||
Changes in balances of each component of accumulated other comprehensive income, net of taxes [Roll Forward] | ||
Net current period other comprehensive loss | (4,472) | $ 771 |
Unrealized Gains on Available-for-Sale Securities [Member] | ||
Changes in balances of each component of accumulated other comprehensive income, net of taxes [Roll Forward] | ||
Beginning balance | 9,279 | |
Other comprehensive loss before reclassifications | (1,153) | |
Amounts reclassified from accumulated other comprehensive income | (3,319) | |
Net current period other comprehensive loss | (4,472) | |
Ending balance | $ 4,807 |