Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2017 | Mar. 14, 2018 | Jun. 30, 2017 | |
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 Public Float | $ 15,787,219 | ||
Entity Common Stock, Shares Outstanding | 20,402,029 | ||
Document Fiscal Year Focus | 2,017 | ||
Document Fiscal Period Focus | FY | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2017 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
ASSETS | ||
Cash and cash equivalents | $ 24,547 | $ 13,252 |
Investments: | ||
Fixed maturities (cost: $212,544 and $210,505) | 215,108 | 210,670 |
Common and non-redeemable preferred stocks (cost: $10,918 and $11,453) | 23,355 | 20,257 |
Other invested assets (cost: $5,626 and $9,709) | 5,626 | 9,709 |
Policy loans | 2,146 | 2,265 |
Real estate | 38 | 38 |
Investment in unconsolidated trusts | 1,238 | 1,238 |
Total investments | 247,511 | 244,177 |
Receivables: | ||
Reinsurance | 17,613 | 11,703 |
Insurance premiums and other, net of allowance for doubtful accounts of $209 and $280 in 2017 and 2016, respectively | 13,241 | 12,581 |
Deferred income taxes, net | 0 | 160 |
Deferred acquisition costs | 32,694 | 28,975 |
Other assets | 5,089 | 5,208 |
Intangibles | 2,544 | 2,544 |
Total assets | 343,239 | 318,600 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Insurance reserves and policyholder funds | 173,583 | 162,679 |
Accounts payable and accrued expenses | 22,342 | 16,677 |
Deferred income taxes, net | 593 | 0 |
Junior subordinated debenture obligations, net | 33,738 | 33,738 |
Total liabilities | 230,256 | 213,094 |
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; 22,400,894 shares issued; 20,449,531 and 20,446,705 shares outstanding in 2017 and 2016, respectively | 22,401 | 22,401 |
Additional paid-in capital | 57,495 | 57,114 |
Retained earnings | 30,993 | 27,272 |
Accumulated other comprehensive income | 9,751 | 5,830 |
Unearned stock grant compensation | (579) | (428) |
Treasury stock, at cost, 1,951,363 and 1,954,189 shares in 2017 and 2016, respectively | (7,133) | (6,738) |
Total shareholders' equity | 112,983 | 105,506 |
Total liabilities and shareholders' equity | $ 343,239 | $ 318,600 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Investments: | ||
Fixed maturities, cost | $ 212,544 | $ 210,505 |
Common and non-redeemable preferred stocks, cost | 10,918 | 11,453 |
Other invested assets, cost | 5,626 | 9,709 |
Receivables: | ||
Insurance premiums and other, allowance for doubtful accounts | $ 209 | $ 280 |
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) | 20,449,531 | 20,446,705 |
Treasury stock, at cost (in shares) | 1,951,363 | 1,954,189 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue: | ||
Insurance premiums | $ 163,327 | $ 153,465 |
Investment income | 8,496 | 9,884 |
Realized investment gains, net | 9,168 | 2,595 |
Other income | 123 | 133 |
Total revenue | 181,114 | 166,077 |
Benefits and expenses: | ||
Insurance benefits and losses incurred | 117,515 | 103,197 |
Commissions and underwriting expenses | 43,446 | 44,797 |
Interest expense | 1,723 | 1,562 |
Other expense | 13,074 | 12,997 |
Total benefits and expenses | 175,758 | 162,553 |
Income before income taxes | 5,356 | 3,524 |
Income tax expense | 828 | 888 |
Net income | 4,528 | 2,636 |
Preferred stock dividends | (399) | (399) |
Net income applicable to common shareholders | $ 4,129 | $ 2,237 |
Earnings per common share (basic and diluted) (in dollars per share) | $ 0.20 | $ 0.11 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2016 | ||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME [Abstract] | |||
Net income | $ 4,528 | $ 2,636 | |
Available-for-sale securities: | |||
Gross unrealized holding gain arising in the period | 15,200 | 4,512 | |
Related income tax effect | (5,320) | (1,579) | |
Less: reclassification adjustment for net realized gains included in net income | [1] | (9,168) | (2,595) |
Related income tax effect | [2] | 3,209 | 908 |
Total other comprehensive income, net of tax | 3,921 | 1,246 | |
Total comprehensive income | $ 8,449 | $ 3,882 | |
[1] | Realized gains on available-for-sale securities recognized in realized investment gains, net on the accompanying consolidated statements of operations. | ||
[2] | Income tax effect on reclassification adjustment for net realized gains included in income tax expense on the accompanying consolidated statements of operations. |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY - 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 |
Beginning Balance at Dec. 31, 2015 | $ 55 | $ 22,401 | $ 56,623 | $ 25,443 | $ 4,584 | $ (273) | $ (6,341) | $ 102,492 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 0 | 0 | 0 | 2,636 | 0 | 0 | 0 | 2,636 |
Other comprehensive income, net of tax | 0 | 0 | 0 | 0 | 1,246 | 0 | 0 | 1,246 |
Dividends on common stock | 0 | 0 | 0 | (408) | 0 | 0 | 0 | (408) |
Dividends on preferred stock | 0 | 0 | 0 | (399) | 0 | 0 | 0 | (399) |
Restricted stock grants | 0 | 0 | 461 | 0 | 0 | (741) | 280 | 0 |
Amortization of unearned compensation | 0 | 0 | 0 | 0 | 0 | 586 | 0 | 586 |
Purchase of shares for treasury | 0 | 0 | 0 | 0 | 0 | 0 | (698) | (698) |
Issuance of shares under stock plans | 0 | 0 | 30 | 0 | 0 | 0 | 21 | 51 |
Ending Balance at Dec. 31, 2016 | 55 | 22,401 | 57,114 | 27,272 | 5,830 | (428) | (6,738) | 105,506 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 0 | 0 | 0 | 4,528 | 0 | 0 | 0 | 4,528 |
Other comprehensive income, net of tax | 0 | 0 | 0 | 0 | 3,921 | 0 | 0 | 3,921 |
Dividends on common stock | 0 | 0 | 0 | (408) | 0 | 0 | 0 | (408) |
Dividends on preferred stock | 0 | 0 | 0 | (399) | 0 | 0 | 0 | (399) |
Restricted stock grants | 0 | 0 | 363 | 0 | 0 | (646) | 283 | 0 |
Amortization of unearned compensation | 0 | 0 | 0 | 0 | 0 | 495 | 0 | 495 |
Purchase of shares for treasury | 0 | 0 | 0 | 0 | 0 | 0 | (692) | (692) |
Issuance of shares under stock plans | 0 | 0 | 18 | 0 | 0 | 0 | 14 | 32 |
Ending Balance at Dec. 31, 2017 | $ 55 | $ 22,401 | $ 57,495 | $ 30,993 | $ 9,751 | $ (579) | $ (7,133) | $ 112,983 |
CONSOLIDATED STATEMENTS OF SHA7
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical) - shares | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Treasury shares purchased (in shares) | 188,066 | 173,008 |
Shares issued under stock plans (in shares) | 8,892 | 13,177 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Cash flows from operating activities: | ||
Net income | $ 4,528 | $ 2,636 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Amortization of deferred acquisition costs | 10,630 | 11,884 |
Acquisition costs deferred | (14,349) | (12,993) |
Realized investment gains, net | (9,168) | (2,595) |
Compensation expense related to share awards | 495 | 586 |
Depreciation and amortization | 1,438 | 1,205 |
Deferred income tax benefit | (1,358) | (2) |
Increase in receivables, net | (6,185) | (407) |
Increase (decrease) in insurance reserves and policyholder funds | 10,904 | (666) |
Increase in other liabilities | 5,665 | 1,649 |
Other, net | 34 | 19 |
Net cash provided by operating activities | 2,634 | 1,316 |
Cash flows from investing activities: | ||
Proceeds from investments sold | 83,992 | 62,361 |
Proceeds from investments matured, called or redeemed | 10,791 | 10,874 |
Investments purchased | (84,552) | (75,071) |
Additions to property and equipment | (103) | (396) |
Net cash provided by (used in) investing activities | 10,128 | (2,232) |
Cash flows from financing activities: | ||
Payment of dividends on Series D preferred stock | (399) | (399) |
Payment of dividends on common stock | (408) | (408) |
Proceeds from shares issued under stock plans | 32 | 51 |
Purchase of shares for treasury | (692) | (698) |
Net cash used in financing activities | (1,467) | (1,454) |
Net increase (decrease) in cash | 11,295 | (2,370) |
Cash and cash equivalents at beginning of year | 13,252 | 15,622 |
Cash and cash equivalents at end of year | 24,547 | 13,252 |
Supplemental cash flow information: | ||
Cash paid for interest | 1,705 | 1,544 |
Cash paid for income taxes | $ 1,400 | $ 675 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1. Summary of Significant Accounting Policies Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) which, for insurance companies, differ in some respects from the statutory accounting practices prescribed or permitted by regulatory authorities. These financial statements include the accounts of Atlantic American Corporation (“Atlantic American” or the “Parent”) and its subsidiaries (collectively with the Parent, the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. Operating results achieved in any historical period are not necessarily indicative of results to be expected in any future period. At December 31, 2017, the Parent owned four insurance subsidiaries, Bankers Fidelity Life Insurance Company and its wholly-owned subsidiary, Bankers Fidelity Assurance Company (together known as “Bankers Fidelity”), and American Southern Insurance Company and its wholly-owned subsidiary, American Safety Insurance Company (together known as “American Southern”), in addition to one non-insurance subsidiary, xCalibre Risk Services, Inc. The Parent has issued a guarantee of all liabilities of Bankers Fidelity. Premium Revenue and Cost Recognition Life insurance premiums are recognized as revenue when due; accident and health insurance premiums are recognized as revenue over the premium paying period and property and casualty insurance premiums are recognized as revenue over the period of the contract in proportion to the amount of insurance protection provided. Losses, benefits and expenses are accrued as incurred and are associated with premiums as they are earned so as to result in recognition of profits over the lives of the contracts. For traditional life insurance and long-duration health insurance, this association is accomplished by the provision of a future policy benefits reserve and the deferral and subsequent amortization of the costs of acquiring business, which are referred to as “deferred policy acquisition costs” (principally commissions, premium taxes, and other incremental direct costs of issuing policies). Deferred policy acquisition costs are amortized over the estimated premium-paying period of the related policies using assumptions consistent with those used in computing the policy benefits reserve. The Company provides for insurance benefits and losses on accident, health, and property-casualty claims based upon estimates of projected ultimate losses. Deferred policy acquisition costs for property and casualty insurance and short-duration health insurance are amortized over the effective period of the related insurance policies. Contingent commissions, if contractually applicable, are ultimately payable to agents based on the underlying profitability of a particular insurance contract or a group of insurance contracts, and are periodically evaluated and accrued as earned. In periods in which revisions are made to the estimated loss reserves related to the particular insurance contract or group of insurance contracts subject to such commissions, corresponding adjustments are also made to the related accruals. Deferred policy acquisition costs are expensed when such costs are deemed not to be recoverable from future premiums (for traditional life and long-duration health insurance) and from the related unearned premiums and investment income (for property and casualty and short-duration health insurance). Intangibles Intangibles consist of goodwill and other indefinite-lived intangible assets. Goodwill represents the excess of cost over the fair value of net assets acquired and is not amortized. Other indefinite-lived intangibles represent the value of licenses and are not amortized. The Company periodically reviews its goodwill and other indefinite-lived intangibles to determine if any adverse conditions exist that could indicate impairment. Conditions that could trigger impairment include, but are not limited to, a significant change in business climate that could affect the value of the related asset, an adverse action, or an assessment by a regulator. No impairment of the Company’s recorded intangibles was identified during any of the periods presented. Investments The Company’s investments in both fixed maturities, which include bonds and redeemable preferred stocks, and equity securities, which include common and non-redeemable preferred stocks, are classified as “available-for-sale” and, accordingly, are carried at fair value with the after-tax difference from amortized cost, as adjusted if applicable, reflected in shareholders’ equity as a component of accumulated other comprehensive income or loss. The fair values of fixed maturities and equity securities are largely determined by either independent methods prescribed by the National Association of Insurance Commissioners (“NAIC”), which do not differ materially from publicly quoted market prices, when available, or independent broker quotations. The Company owns certain fixed maturities that do not have publicly quoted market values, but had an estimated fair value as determined by management of $1,369 and $1,264 at December 31, 2017 and 2016, respectively. Such values inherently involve a greater degree of judgment and uncertainty and therefore ultimately greater price volatility than the value of securities with publicly quoted market values. Policy loans and real estate are carried at historical cost. Other invested assets are comprised of investments in limited partnerships, limited liability companies, and real estate joint ventures, and are accounted for using the equity method. If the value of a common stock, preferred stock, other invested asset, or publicly traded bond declines below its cost or amortized cost, as applicable, and the decline is considered to be other than temporary, a realized loss is recorded to reduce the carrying value of the investment to its estimated fair value, which becomes the new cost basis. 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. Premiums and discounts related to investments are amortized or accreted over the life of the related investment as an adjustment to yield using the effective interest method. Dividends and interest income are recognized when earned or declared. The cost of securities sold is based on specific identification. Unrealized gains (losses) in the value of invested assets are accounted for as a direct increase (decrease) in accumulated other comprehensive income in shareholders’ equity, net of deferred tax and, accordingly, have no effect on net income. Income Taxes Deferred income taxes represent the expected future tax consequences when the reported amounts of assets and liabilities are recovered or paid. They arise from differences between the financial reporting and tax basis of assets and liabilities and are adjusted for changes in tax laws and tax rates as those changes are enacted. The provision for income taxes represents the total amount of income taxes due related to the current year, plus the change in deferred income taxes during the year. A valuation allowance is recognized if, based on management’s assessment of the relevant facts, it is more likely than not that some portion of a deferred tax asset will not be realized. Earnings Per Common Share Basic earnings per common share are based on the weighted average number of common and participating shares outstanding during the relevant period. Diluted earnings per common share are based on the weighted average number of common and participating shares outstanding during the relevant period, plus options outstanding, if applicable, using the treasury stock method and the assumed conversion of the Series D preferred stock, if dilutive. Unless otherwise indicated, earnings per common share amounts are presented on a diluted basis. Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand and investments in short-term, highly liquid securities with original maturities of three months or less from date of purchase. Recently Issued Accounting Standards 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 (“ASU 2018-02”). The FASB issued this guidance for the effect on deferred tax assets and liabilities related to items recorded in accumulated other comprehensive income (“AOCI”) resulting from legislated tax reform enacted on December 22, 2017. The tax reform reduced the federal tax rate applied to the Company’s deferred tax balances from 35% to 21% on enactment. Under current GAAP, the Company recorded the total effect of the change in enacted tax rates on deferred tax balances in the income tax expense component of net income. ASU 2018-02 permits the Company to reclassify out of AOCI and into retained earnings the “stranded” tax effects that resulted from recording the tax effects of unrealized investment gains at a 35% tax rate because the 14 point reduction in tax rate was recognized in net income instead of other comprehensive income. The Company will adopt the new guidance as of January 1, 2018. As a result of the reclassification, on January 1, 2018, the Company will reclassify $2,100 of stranded tax effects related to continuing operations which will have the effect of reducing AOCI and increasing retained earnings. In March 2017, the FASB issued ASU No. 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities (“ASU 2017-08”). This guidance shortens the amortization period for certain callable debt securities held at a premium to the earliest call date. Under current GAAP, premiums and discounts on callable securities generally are amortized to the maturity date. ASU 2017-08 is effective for interim and annual reporting periods beginning after December 15, 2018, although earlier adoption is permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 is intended to simplify the evaluation of goodwill. The updated guidance requires recognition and measurement of goodwill impairment based on the excess of the carrying value of the reporting unit compared to its estimated fair value, with the amount of the impairment not to exceed the carrying value of the reporting unit’s goodwill. Under existing guidance, if the reporting unit’s carrying value exceeds its estimated fair value, the Company allocates the fair value of the reporting unit to all of the assets and liabilities of the reporting unit to determine an implied goodwill value. An impairment loss is then recognized for the excess, if any, of the carrying value of the reporting unit’s goodwill compared to the implied goodwill value. The amendments in ASU 2017-04 are effective for interim and annual reporting periods beginning after December 15, 2019. The Company expects to adopt the updated guidance January 1, 2020 on a prospective basis as required, although earlier adoption is permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The issues addressed in ASU 2016-15 are: 1) debt prepayment or debt extinguishment costs, 2) settlement of zero-coupon debt instruments, 3) contingent consideration payments made after a business combination, 4) proceeds from the settlement of insurance claims, 5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, 6) distributions received from equity method investees, 7) beneficial interests in securitization transactions and 8) separately identifiable cash flows and application of the predominance principle. The amendments in ASU 2016-15 are effective for interim and annual reporting periods beginning after December 15, 2017. The Company does not expect the adoption of this ASU to have an impact on its consolidated statements of cash flows. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires entities to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. Under current GAAP, entities generally recognize credit losses when it is probable that the loss has been incurred. ASU 2016-13 will remove all recognition thresholds and will require entities to recognize an allowance for credit losses equal to the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the entity expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale (“AFS”) debt securities and beneficial interests in securitized financial assets. Credit losses on AFS debt securities carried at fair value will continue to be measured as other-than-temporary impairments (“OTTI”) when incurred; however, the losses will be recognized through an allowance and no longer as an adjustment to the cost basis. Recoveries of OTTI will be recognized as reversals of valuation allowances and no longer accreted as investment income through an adjustment to the investment yield. The allowance on AFS debt securities cannot cause the net carrying value to be below fair value and, therefore, it is possible that increases in fair value due to decreases in market interest rates could cause the reversal of a valuation allowance and increase net income. The new guidance will also require purchased financial assets with a more-than-insignificant amount of credit deterioration since original issuance to be recorded based on contractual amounts due and an initial allowance recorded at the date of purchase. For the Company, the amendments in ASU 2016-13 will be effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company has not yet determined the timing of adoption. Implementation matters yet to be addressed include determining the impact of valuation allowances on the effective interest method for recognizing interest income from AFS debt securities as well as updating our investment accounting system functionality to adjust valuation allowances based on changes in fair value. The estimated effect on the Company’s financial statements can only be estimated based on the current investment portfolio at any given point in time, and accordingly, has not currently been determined. In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”). This guidance applies to all entities that issue share-based payment awards to their employees and is designed to simplify several areas of the accounting for share-based payment transactions, including income tax consequences, forfeitures, classification of awards as either equity or liabilities and related classification on the statement of cash flows. ASU 2016-09 requires the excess tax benefit or deficiency on vesting or settlement of awards to be recognized in earnings as an income tax benefit or expense, respectively. The Company adopted ASU 2016-09 as of January 1, 2017. Adoption of ASU 2016-09 did not have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments – Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting (“ASU 2016-07”). This guidance eliminates the requirement to retroactively adopt the equity method of accounting when an investment qualifies for the use of the equity method as a result of an increase in the level of ownership or degree of influence. Under ASU 2016-07, the equity method investor is required to add the cost of acquiring the additional interest in the investee to the current basis of the previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The Company adopted ASU 2016-07 as of January 1, 2017. Adoption of ASU 2016-07 did not have an impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). Under this guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Under ASU 2016-02, lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Under the new guidance, lessees with operating leases will be required to recognize a liability for the present value of future minimum lease payments with a corresponding asset for the right of use of the property. Under existing guidance, future minimum lease payments on operating leases are commitments that are not recognized as liabilities on the balance sheet. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018 and requires a modified retrospective adoption, with early adoption permitted. The Company does not expect the adoption of ASU 2016-02 to have a material impact on its consolidated financial statements; however, it is expected that assets and liabilities will increase based on the present value of remaining lease payments for the minor number of leases which will be in place at the adoption date. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10) (“ASU 2016-01”). ASU 2016-01 provides updated guidance for the recognition and measurement of financial instruments. The new guidance will require investments in equity securities to be measured at fair value with any changes in valuation reported in net income except for investments that are consolidated or are accounted for under the equity method of accounting. The new guidance will also require a deferred tax asset resulting from net unrealized losses on available-for-sale (AFS) fixed maturities that are recognized in AOCI to be evaluated for recoverability in combination with the Company’s other deferred tax assets. Under existing guidance, the Company measures investments in equity securities, AFS at fair value with changes in fair value reported in other comprehensive income. As required, the Company will adopt the guidance effective January 1, 2018 through a cumulative effect adjustment to retained earnings. Early adoption is not allowed. The impact to the Company will be increased volatility in net income beginning in 2018. Any difference in the evaluation of deferred tax assets may also affect shareholders’ equity. Cash flows will not be affected. The impact will depend on the composition of the Company’s investment portfolio in the future and changes in fair value of the Company’s investments. As of January 1, 2018, the Company will reclassify from AOCI to retained earnings net unrealized gains of $9,825, after tax, related to equity securities, AFS having a fair value of $23,355. Had the new accounting guidance been in place since the beginning of 2017, the Company would have recognized mark-to-market gains of $2,361 after-tax in net income for the year ended December 31, 2017. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 as modified provides guidance for recognizing revenue. The guidance excludes insurance contracts and financial instruments. Revenue is to be recognized when, or as, goods or services are transferred to customers in an amount that reflects the consideration that an entity is expected to be entitled in exchange for those goods or services. This guidance is effective retrospectively on January 1, 2018, with a choice of restating prior periods or recognizing a cumulative effect for contracts in place as of adoption. The Company will adopt ASU 2014-09 on January 1, 2018. Based on current evaluations, the adoption of this ASU will not have a material impact on the Company’s consolidated financial statements. Use of Estimates in the Preparation of Financial Statements The preparation of financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Significant estimates and assumptions are used in developing and evaluating deferred income taxes, deferred acquisition costs, insurance reserves, investments, and receivables, among others, and actual results could differ materially from management’s estimates. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2017 | |
Investments [Abstract ] | |
Investments | Note 2. Investments The following tables set forth the carrying value, gross unrealized gains, gross unrealized losses and cost or amortized cost of the Company’s investments, aggregated by type and industry, as of December 31, 2017 and December 31, 2016. Investments were comprised of the following: 2017 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Cost or Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,155 $ 149 $ 511 $ 31,517 Obligations of states and political subdivisions 10,809 630 1 10,180 Corporate securities: Utilities and telecom 21,882 1,709 130 20,303 Financial services 53,686 2,049 453 52,090 Other business – diversified 44,184 1,024 1,349 44,509 Other consumer – diversified 53,200 924 1,477 53,753 Total corporate securities 172,952 5,706 3,409 170,655 Redeemable preferred stocks: Other consumer – diversified 192 — — 192 Total redeemable preferred stocks 192 — — 192 Total fixed maturities 215,108 6,485 3,921 212,544 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,588 624 — 964 Financial services 5,634 851 — 4,783 Other business – diversified 297 250 — 47 Other consumer – diversified 15,836 10,712 — 5,124 Total equity securities 23,355 12,437 — 10,918 Other invested assets 5,626 — — 5,626 Policy loans 2,146 — — 2,146 Real estate 38 — — 38 Investments in unconsolidated trusts 1,238 — — 1,238 Total investments $ 247,511 $ 18,922 $ 3,921 $ 232,510 2016 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Cost or Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,102 $ 197 $ 553 $ 31,458 Obligations of states and political subdivisions 17,572 625 308 17,255 Corporate securities: Utilities and telecom 18,034 1,462 88 16,660 Financial services 57,282 1,880 911 56,313 Other business – diversified 57,419 1,071 2,337 58,685 Other consumer – diversified 29,069 471 1,344 29,942 Total corporate securities 161,804 4,884 4,680 161,600 Redeemable preferred stocks: Other consumer – diversified 192 — — 192 Total redeemable preferred stocks 192 — — 192 Total fixed maturities 210,670 5,706 5,541 210,505 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,601 637 — 964 Financial services 5,402 574 — 4,828 Other business – diversified 244 197 — 47 Other consumer – diversified 13,010 7,396 — 5,614 Total equity securities 20,257 8,804 — 11,453 Other invested assets 9,709 — — 9,709 Policy loans 2,265 — — 2,265 Real estate 38 — — 38 Investments in unconsolidated trusts 1,238 — — 1,238 Total investments $ 244,177 $ 14,510 $ 5,541 $ 235,208 Bonds having an amortized cost of $11,178 and $11,435 and included in the tables above were on deposit with insurance regulatory authorities at December 31, 2017 and 2016, respectively, in accordance with statutory requirements. The following table sets forth the carrying value, cost or amortized cost, and net unrealized gains (losses) of the Company’s investments aggregated by industry as of December 31, 2017 and 2016. 2017 2016 Carrying Value Cost or Amortized Cost Unrealized Gains (Losses) Carrying Value Cost or Amortized Cost Unrealized Gains (Losses) U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,155 $ 31,517 $ (362 ) $ 31,102 $ 31,458 $ (356 ) Obligations of states and political subdivisions 10,809 10,180 629 17,572 17,255 317 Utilities and telecom 23,470 21,267 2,203 19,635 17,624 2,011 Financial services 59,320 56,873 2,447 62,684 61,141 1,543 Other business – diversified 44,481 44,556 (75 ) 57,663 58,732 (1,069 ) Other consumer – diversified 69,228 59,069 10,159 42,271 35,748 6,523 Other investments 9,048 9,048 — 13,250 13,250 — Total investments $ 247,511 $ 232,510 $ 15,001 $ 244,177 $ 235,208 $ 8,969 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 December 31, 2017 and 2016. 2017 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 $ 12,175 $ 162 $ 12,737 $ 349 $ 24,912 $ 511 Obligations of states and political subdivisions 999 1 — — 999 1 Corporate securities 40,108 653 32,667 2,756 72,775 3,409 Total temporarily impaired securities $ 53,282 $ 816 $ 45,404 $ 3,105 $ 98,686 $ 3,921 2016 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 $ 23,494 $ 553 $ — $ — $ 23,494 $ 553 Obligations of states and political subdivisions 8,747 308 — — 8,747 308 Corporate securities 59,404 2,124 20,587 2,556 79,991 4,680 Total temporarily impaired securities $ 91,645 $ 2,985 $ 20,587 $ 2,556 $ 112,232 $ 5,541 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. As of December 31, 2017 and 2016, there were sixty-nine and seventy-seven securities, respectively, in an unrealized loss position which primarily included certain of the Company’s investments in fixed maturities within the other diversified business and other diversified consumer sectors. Securities in an unrealized loss position reported in the other diversified business sector included gross unrealized losses of $906 related to investments in fixed maturities of four different issuers, all related to the oil and gas industry. These issuers represent a diversified group of businesses which include, among others, exploration and production, pipeline owners and operators, deep water offshore rig owners and operators, all of which we believe are in continuing stages of rationalizing their current operations, investments, future capital expenditures and carefully managing and modifying their capital and liquidity positions. Based on publicly available information, the companies are continuing to assess and revise short-term, intermediate and long-term business plans in response to the current trends in oil and gas markets. All of the investees have continued to make regular interest payments on their debt when and as due and the Company continues to perform in-depth analyses of the publicly available financial disclosures of each of the investees on a regular basis. 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 December 31, 2017. 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 of its fixed maturities and non-redeemable preferred stocks using Level 2 criteria, the Company utilizes data from outside sources, including nationally recognized pricing services and broker/dealers. Prices for the majority of the Company’s Level 2 fixed maturities and non-redeemable preferred stocks were determined using unadjusted prices received from pricing services that utilize a matrix pricing concept, which is a mathematical technique used widely in the industry to value debt securities based on various relationships to other benchmark quoted prices. 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 December 31, 2017 and December 31, 2016, the value of the Company’s fixed maturities valued using Level 3 criteria was $1,369 and $1,264, respectively. The use of different criteria or assumptions regarding data may have yielded materially different valuations. As of December 31, 2017, financial instruments carried at fair value were measured on a recurring basis as summarized below: Assets: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fixed maturities $ — $ 213,739 $ 1,369 (1) $ 215,108 Equity securities 17,973 5,382 (1) — 23,355 Cash equivalents 13,855 — — 13,855 Total $ 31,828 $ 219,121 $ 1,369 $ 252,318 (1) All underlying securities are financial service industry related. As of December 31, 2016, financial instruments carried at fair value were measured on a recurring basis as summarized below: Assets: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fixed maturities $ — $ 209,406 $ 1,264 (1) $ 210,670 Equity securities 15,153 5,104 (1) — 20,257 Cash equivalents 9,811 — — 9,811 Total $ 24,964 $ 214,510 $ 1,264 $ 240,738 (1) All underlying securities are financial service industry related. 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) from January 1, 2016 to December 31, 2017. Fixed Maturities Balance, January 1, 2016 $ 2,237 Total realized gains included in earnings 57 Total unrealized losses included in other comprehensive income (30 ) Settlements (1,000 ) Balance, December 31, 2016 1,264 Total unrealized gains included in other comprehensive income 105 Balance, December 31, 2017 $ 1,369 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 repayment of the principal. Other qualitative and quantitative information received from the original underwriter of the pooled offerings is also considered, as applicable. The carrying value and amortized cost of the Company’s investments in fixed maturities at December 31, 2017 and 2016 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. 2017 2016 Carrying Value Amortized Cost Carrying Value Amortized Cost Due in one year or less $ 1,653 $ 1,655 $ 2,544 $ 2,507 Due after one year through five years 13,738 14,056 20,278 20,038 Due after five years through ten years 112,847 112,116 90,667 90,926 Due after ten years 67,328 64,928 80,099 79,627 Varying maturities 19,542 19,789 17,082 17,407 Totals $ 215,108 $ 212,544 $ 210,670 $ 210,505 Investment income was earned from the following sources: 2017 2016 Fixed maturities $ 8,297 $ 9,122 Equity securities 467 491 Other (268 ) 271 Total investment income 8,496 9,884 Less investment expenses, included in other expenses (789 ) (577 ) Net investment income $ 7,707 $ 9,307 A summary of realized investment gains (losses) follows: 2017 Fixed Maturities Equity Securities Other Invested Assets Total Gains $ 2,226 $ 1,044 $ 6,040 $ 9,310 Losses (142 ) — — (142 ) Realized investment gains, net $ 2,084 $ 1,044 $ 6,040 $ 9,168 2016 Fixed Maturities Equity Securities Other Invested Assets Total Gains $ 1,119 $ — $ 1,565 $ 2,684 Losses (89 ) — — (89 ) Realized investment gains, net $ 1,030 $ — $ 1,565 $ 2,595 Proceeds from the sales of investments were as follows: 2017 2016 Fixed maturities $ 72,760 $ 59,072 Equity securities 1,579 — Other investments 9,653 3,289 Total proceeds $ 83,992 $ 62,361 The Company’s bond portfolio included 92% investment grade securities, as defined by the NAIC, at December 31, 2017. |
Insurance Reserves and Policyho
Insurance Reserves and Policyholder Funds | 12 Months Ended |
Dec. 31, 2017 | |
Liabilities for Unpaid Losses, Claims and Loss Adjustment Expenses [Abstract] | |
Insurance Reserves and Policyholder Funds | Note 3. Insurance Reserves and Policyholder Funds The following table presents the Company’s reserves for life, accident and health, and property and casualty losses, claims and loss adjustment expenses at December 31, 2017 and 2016. Amount of Insurance In Force, Net 2017 2016 2017 2016 Future policy benefits Life insurance policies: Ordinary $ 54,752 $ 54,554 $ 238,534 $ 245,017 Mass market 1,693 2,003 2,070 2,463 Individual annuities 50 84 — — 56,495 56,641 $ 240,604 $ 247,480 Accident and health insurance policies 25,940 18,202 82,435 74,843 Unearned premiums 23,449 23,208 Losses, claims and loss adjustment expenses 65,689 62,562 Other policy liabilities 2,010 2,066 Total insurance reserves and policyholder funds $ 173,583 $ 162,679 Annualized premiums for accident and health insurance policies were $105,422 and $95,956 at December 31, 2017 and 2016, respectively. Future Policy Benefits Liabilities for life insurance future policy benefits are based upon assumed future investment yields, mortality rates, and withdrawal rates after giving effect to possible risks of unexpected claim experience. The assumed mortality and withdrawal rates are based upon the Company’s experience. The interest rates assumed for life, accident and health future policy benefits are generally: (i) 2.5% to 5.5% for issues prior to 1977, (ii) 7% graded to 5.5% for 1977 through 1979 issues, (iii) 9% for 1980 through 1987 issues, (iv) 5% to 7% for 1988 through 2009 issues, (v) 4% for 2010 through 2012 issues, and (vi) 3.5% to 4.0% for 2013 through 2017 issues. Loss and Claim Reserves Loss and claim reserves represent estimates of projected ultimate losses and are based upon: (a) management’s estimate of ultimate liability and claims adjusters’ evaluations for unpaid claims reported prior to the close of the accounting period, (b) estimates of incurred but not reported (“IBNR”) claims based on past experience, and (c) estimates of loss adjustment expenses. The estimated liability is periodically reviewed by management and updated, with changes to the estimated liability recorded in the statement of operations in the year in which such changes are known. Activity in the liability for unpaid loss and claim reserves is summarized as follows: 2017 2016 Balance at January 1 $ 62,562 $ 63,870 Less: Reinsurance recoverable on unpaid losses (10,796 ) (11,741 ) Net balance at January 1 51,766 52,129 Incurred related to: Current year 114,099 103,252 Prior years (1,765 ) (3,377 ) Total incurred 112,334 99,875 Paid related to: Current year 82,092 71,980 Prior years 28,287 28,258 Total paid 110,379 100,238 Net balance at December 31 53,721 51,766 Plus: Reinsurance recoverable on unpaid losses 11,968 10,796 Balance at December 31 $ 65,689 $ 62,562 Prior years’ development was primarily the result of better than expected development on prior years loss and claim reserves for certain lines of business in American Southern. Following is a reconciliation of total incurred losses to total insurance benefits and losses incurred: 2017 2016 Total incurred losses $ 112,334 $ 99,875 Cash surrender value and matured endowments 1,442 1,278 Benefit reserve changes 3,739 2,044 Total insurance benefits and losses incurred $ 117,515 $ 103,197 Liability for Unpaid Losses, Claims and Loss Adjustment Expenses The following is information, by significant product lines, about incurred and paid claims development as of December 31, 2017, net of reinsurance, as well as the cumulative number of reported claims and the total of IBNR reserves plus expected development on reported claims included within the net incurred claims amounts. The information about incurred and paid claims development for the years ended December 31, 2008 to 2017 is presented as supplementary information. Medicare Supplement For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 29,344 $ 28,698 $ 28,721 $ 28,712 $ 28,688 $ 28,687 $ 28,683 $ 28,683 $ 28,682 $ 28,682 $ — 533,112 2009 31,124 30,455 30,481 30,447 30,438 30,432 30,431 30,430 30,430 — 560,430 2010 34,849 34,328 34,323 34,303 34,282 34,272 34,268 34,265 — 625,695 2011 38,188 38,296 38,360 38,327 38,316 38,302 38,299 — 664,049 2012 50,021 50,996 51,021 50,998 50,989 50,987 — 867,047 2013 56,974 56,970 57,034 57,023 57,021 — 957,350 2014 57,179 56,938 56,981 56,981 — 939,444 2015 55,482 54,939 54,993 — 898,270 2016 58,849 59,851 100 1,034,900 2017 67,960 9,822 1,303,865 $ 479,469 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 24,055 $ 28,698 $ 28,721 $ 28,712 $ 28,688 $ 28,687 $ 28,683 $ 28,683 $ 28,682 $ 28,682 2009 29,866 30,455 30,481 30,447 30,438 30,432 30,431 30,430 30,430 2010 29,127 34,328 34,323 34,303 34,282 34,272 34,268 34,265 2011 31,720 38,296 38,360 38,327 38,316 38,302 38,299 2012 42,267 50,996 51,021 50,998 50,989 50,987 2013 47,770 56,970 57,034 57,023 57,021 2014 48,024 56,938 56,981 56,981 2015 45,430 54,876 54,993 2016 49,165 59,747 2017 57,696 $ 469,101 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 10,368 The cumulative number of reported claims for the Medicare Supplement line of business is the number of distinct claims incurred and submitted to Medicare for payment in the given year. Multiple payments on the same claim are not counted in the frequency information. Estimated ultimate claims incurred, using claims data reported during each month of any given year, are calculated using the chain ladder method modified to use seasonality and trend-adjusted expected claims for the final two months. Additional adjustments to the estimated ultimate claims incurred are then applied to account for seasonal changes in billing and payment frequencies. The IBNR reserve is calculated as estimated ultimate claims less paid claims and claims in course of settlement. Thirty-six months of loss data are used to develop the estimated ultimate incurred claims. Similar approaches are used for other less significant health products, subject to modifications to account for unique aspects of the product. Automobile Liability For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 9,723 $ 7,011 $ 6,627 $ 6,374 $ 6,124 $ 6,112 $ 6,106 $ 6,104 $ 6,105 $ 6,105 $ — 1,534 2009 10,817 8,891 8,659 8,558 8,245 8,123 8,155 8,154 8,153 — 1,755 2010 10,752 10,818 10,547 9,937 10,068 10,185 10,202 10,201 — 1,947 2011 12,263 13,802 13,235 13,289 13,281 13,495 13,385 30 2,132 2012 12,980 15,007 14,108 13,707 13,313 13,343 22 3,340 2013 18,664 20,702 21,096 21,823 21,352 162 3,260 2014 20,812 21,881 22,041 22,353 816 3,536 2015 18,521 19,857 20,017 1,904 3,492 2016 20,549 21,275 3,049 3,755 2017 22,179 7,311 3,385 $ 158,363 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 2,426 $ 4,202 $ 5,077 $ 5,695 $ 5,839 $ 6,065 $ 6,104 $ 6,104 $ 6,105 $ 6,105 2009 3,250 5,208 6,353 7,502 7,995 8,123 8,155 8,154 8,153 2010 3,211 6,274 8,291 9,382 9,725 10,056 10,090 10,206 2011 4,205 7,934 9,858 12,071 13,039 13,106 13,199 2012 4,627 8,791 11,507 12,932 13,197 13,211 2013 5,144 12,193 16,782 19,407 20,382 2014 6,822 13,807 17,554 20,177 2015 6,226 11,878 14,938 2016 6,796 13,141 2017 7,401 $ 126,913 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 31,450 Automobile Physical Damage For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2013 2014 2015 2016 2017 2013 $ 6,039 $ 5,515 $ 5,536 $ 5,599 $ 5,599 $ — 1,598 2014 8,079 7,657 7,583 7,562 — 1,635 2015 8,287 7,955 7,887 — 1,588 2016 6,877 6,386 3 1,261 2017 6,257 105 1,238 $ 33,691 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2013 2014 2015 2016 2017 2013 $ 4,778 $ 5,486 $ 5,466 $ 5,599 $ 5,599 2014 6,437 7,619 7,570 7,562 2015 6,745 7,937 7,885 2016 5,804 6,353 2017 5,215 $ 32,614 All outstanding liabilities before 2013, net of reinsurance 33 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 1,110 General Liability For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 5,386 $ 4,359 $ 2,858 $ 2,685 $ 2,479 $ 2,489 $ 2,507 $ 2,548 $ 2,647 $ 2,853 $ 23 393 2009 3,392 2,215 1,944 1,730 1,702 1,727 1,828 1,832 1,888 8 290 2010 4,114 2,699 2,269 2,337 2,258 2,400 2,423 2,473 4 289 2011 3,022 1,723 1,452 1,338 1,174 1,242 1,327 11 201 2012 4,055 1,305 1,269 1,270 1,214 1,333 26 157 2013 3,461 728 926 817 865 18 187 2014 3,744 501 557 476 40 192 2015 4,421 1,037 1,227 348 143 2016 3,119 1,148 440 81 2017 1,490 1,241 58 $ 15,080 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 534 $ 1,091 $ 1,637 $ 1,861 $ 2,023 $ 2,123 $ 2,418 $ 2,506 $ 2,564 $ 2,755 2009 476 941 1,082 1,410 1,629 1,662 1,796 1,816 1,855 2010 284 678 1,374 1,542 2,037 2,368 2,382 2,457 2011 295 412 582 835 1,161 1,169 1,278 2012 371 707 847 1,034 1,113 1,219 2013 104 339 579 811 791 2014 171 299 331 369 2015 98 259 464 2016 116 203 2017 75 $ 11,466 All outstanding liabilities before 2008, net of reinsurance 288 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 3,902 Surety For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 3,883 $ 2,098 $ 2,420 $ 2,312 $ 2,312 $ 2,360 $ 2,360 $ 2,324 $ 2,324 $ 2,324 $ — 62 2009 4,920 5,025 4,239 3,951 3,616 4,636 4,916 4,664 4,667 — 83 2010 3,995 4,624 3,618 3,396 3,607 3,549 3,563 3,534 — 95 2011 4,422 4,786 5,080 5,092 4,966 5,031 5,112 — 126 2012 4,979 4,767 5,396 5,345 4,869 4,880 — 87 2013 3,060 2,007 2,743 2,947 2,866 13 57 2014 3,214 3,130 2,990 2,760 4 51 2015 1,902 1,630 1,400 78 49 2016 3,314 1,812 39 45 2017 4,677 2,043 52 $ 34,032 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 503 $ 1,369 $ 2,261 $ 2,232 $ 2,311 $ 2,359 $ 2,360 $ 2,324 $ 2,324 $ 2,324 2009 103 1,595 2,640 3,205 3,410 3,760 3,757 4,663 4,666 2010 928 2,193 2,780 2,943 3,252 3,545 3,560 3,534 2011 1,031 3,207 4,622 4,748 4,939 5,022 5,109 2012 2,257 4,581 4,856 5,331 4,869 4,880 2013 323 1,010 1,369 2,763 2,789 2014 1,331 2,327 2,727 2,739 2015 641 856 1,127 2016 1,054 1,732 2017 1,971 $ 30,871 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 3,161 For the property and casualty lines of business, the number of claims presented above equals the number of occurrences by type of claim reported to the Company. The number of claims reported during a given year corresponds to the number of claims records opened during the year. Frequency information is maintained on a cumulative basis by accident year by line of business. For automobile claims, a claim count is separately maintained for bodily injury, property damage and physical damage claims. The Company has consistently monitored claim frequency on this basis, and believes this provides more meaningful information than using claimant count which can change over the course of settling a claim. In general, when a claim is reported, claims representatives establish a “case reserve” for the estimated amount of the ultimate payment based on the known information of the claim at that time. Claims managers review and monitor all property and casualty claims in excess of $25,000. As new information becomes available or payments are made on a claim, the case reserve is adjusted to reflect the revised estimate of the ultimate amount to be paid out. Estimates and assumptions pertaining to individual claims are based on complex and subjective judgments and subject to change at any time as new information becomes available. In addition to case reserves, IBNR reserves are established to provide for claims which have not been reported to the Company as of the reporting date as well as potential adverse development on known case reserves. IBNR reserve estimates are derived through a number of analytical techniques. Actuarial data is analyzed by line of business, coverage and accident year. Qualitative factors are also considered in determining IBNR reserves and include such factors as judicial decisions, general economic trends such as inflation, changes in policy forms, and underwriting changes. Reserves are reviewed quarterly and any indicated adjustments are made. Because of the inherent uncertainties in establishing both case and IBNR reserves, ultimate loss experience may prove better or worse than indicated by the combined claim reserves. Adjustments to claim reserves are reflected in the period recognized and could increase or decrease earnings for the period. The following is supplementary information about average historical claims duration as of December 31, 2017. Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Unaudited) Reserve Line 1st Year 2nd Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year 9th Year 10th Year Medicare Supplement 83.7 % 16.4 % 0.1 % -0.1 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % Automobile Liability 32.8 % 29.4 % 17.1 % 12.3 % 4.3 % 1.8 % 0.5 % 0.4 % 0.0 % 0.0 % Automobile Physical Damage 86.0 % 13.0 % -0.6 % 1.1 % 0.0 % General Liability 17.7 % 18.8 % 16.2 % 14.3 % 10.9 % 5.4 % 6.6 % 2.4 % 2.0 % 6.7 % Surety 32.2 % 34.2 % 19.6 % 11.0 % 2.0 % 3.9 % 0.5 % 5.7 % 0.0 % 0.0 % The reconciliation of the net incurred and paid claims development tables to the liability for losses, claims and loss adjustment expenses is as follows: December 31, 2017 Net outstanding liabilities: Medicare Supplement $ 10,368 Automobile Liability 31,450 Automobile Physical Damage 1,110 General Liability 3,902 Surety 3,161 Other short-duration insurance lines 2,004 Liabilities for unpaid losses, claims and loss adjustment expenses, net of reinsurance 51,995 Reinsurance recoverable on unpaid losses: Medicare Supplement 4,748 Automobile Liability 5,245 Automobile Physical Damage 116 General Liability 1,859 Total reinsurance recoverable on unpaid losses 11,968 Unallocated claims adjustment expenses 1,726 Total gross liability for unpaid losses, claims and loss adjustment expenses $ 65,689 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2017 | |
Reinsurance [Abstract] | |
Reinsurance | Note 4. Reinsurance In accordance with general practice in the insurance industry, portions of the life, property and casualty insurance written by the Company are reinsured; however, the Company remains liable with respect to reinsurance ceded should any reinsurer be unable or unwilling to meet its obligations. Approximately 99% of the Company’s reinsurance recoverables were due from two reinsurers as of December 31, 2017. Reinsurance recoverables of $60 were due from Swiss Reinsurance Corporation, rated “AA-” by Standard & Poor’s and “A+” (Superior) by A.M. Best and $17,449 were due from General Re Life Corporation, rated “AA+” by Standard & Poor’s and “A++” (Superior) by A.M. Best. Allowances for uncollectible amounts are established against reinsurance recoverables, if appropriate. The effects of reinsurance on premiums written, premiums earned and insurance benefits and losses incurred were as follows: 2017 2016 Direct premiums written $ 181,568 $ 142,200 Assumed premiums written 19,373 19,123 Ceded premiums written (38,019 ) (10,225 ) Net premiums written $ 162,922 $ 151,098 Direct premiums earned $ 181,458 $ 144,339 Assumed premiums earned 19,241 19,124 Ceded premiums earned (37,372 ) (9,998 ) Net premiums earned $ 163,327 $ 153,465 Provision for benefits and losses incurred $ 147,444 $ 109,616 Reinsurance loss recoveries (29,929 ) (6,419 ) Insurance benefits and losses incurred $ 117,515 $ 103,197 Components of reinsurance recoverables at December 31, 2017 and 2016 were as follows: 2017 2016 Recoverable on unpaid losses $ 11,968 $ 10,796 Recoverable on unpaid benefits 4,403 655 Ceded unearned premiums 874 227 Ceded advanced premiums 368 25 Total reinsurance recoverables $ 17,613 $ 11,703 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes [Abstract] | |
Income Taxes | Note 5. Income Taxes Total income taxes were allocated as follows: 2017 2016 Total tax expense on income $ 828 $ 888 Tax expense on components of shareholders’ equity: Net unrealized gains on investment securities 2,111 671 Total tax expense $ 2,939 $ 1,559 A reconciliation of the differences between income taxes computed at the federal statutory income tax rate and the income tax expense is as follows: 2017 2016 Federal income tax provision at statutory rate of 35% $ 1,875 $ 1,233 Dividends-received deduction (92 ) (95 ) Small life insurance company deduction (613 ) (376 ) Other 72 55 Remeasurement of deferred taxes due to tax reform enactment (395 ) — Adjustment for prior years’ estimates to actual (19 ) 71 Income tax expense $ 828 $ 888 Effective tax rate 15.5 % 25.2 % The primary differences between the effective tax rate and the federal statutory income tax rate for 2017 and 2016 resulted from the dividends-received deduction (“DRD”), the small life insurance company deduction (“SLD”) and the remeasurement of deferred taxes. 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 remeasurement of deferred taxes resulted from legislated tax reform enacted on December 22, 2017. The tax reform reduced the federal tax rate applied to the Company’s deferred tax balances from 35% to 21% on enactment. Deferred tax liabilities and assets at December 31, 2017 and 2016 were comprised of the following: 2017 2016 Deferred tax liabilities: Deferred acquisition costs $ (1,200 ) $ (2,345 ) Deferred and uncollected premiums (377 ) (654 ) Net unrealized investment gains (3,150 ) (3,140 ) Other (331 ) (666 ) Total deferred tax liabilities (5,058 ) (6,805 ) Deferred tax assets: Insurance reserves 3,216 4,589 Impaired assets 869 1,454 Alternative minimum tax credit — 282 Bad debts and other 380 640 Total deferred tax assets 4,465 6,965 Net deferred tax asset (liability) $ (593 ) $ 160 The components of income tax expense were: 2017 2016 Current - Federal $ 2,186 $ 890 Deferred - Federal (1,358 ) (2 ) Total $ 828 $ 888 The Company has formal tax-sharing agreements, and files a consolidated income tax return, with its subsidiaries. Tax years prior to 2012 have been audited by the Internal Revenue Service and are closed. |
Junior Subordinated Debentures
Junior Subordinated Debentures | 12 Months Ended |
Dec. 31, 2017 | |
Junior Subordinated Debentures [Abstract] | |
Junior Subordinated Debentures | Note 6. Junior Subordinated Debentures 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 December 31, 2017 and 2016, 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 December 31, 2017 $18,042 $23,196 Less: Treasury debt (3) (7,500) Net balance December 31, 2017 $18,042 $15,696 Net balance December 31, 2016 $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 Atlantic (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) In 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. (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. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies [Abstract] | |
Commitments and Contingencies | Note 7. Commitments and Contingencies Litigation 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 business. 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. Operating Lease Commitments The Company’s rental expense, including common area charges, for operating leases was $1,306 and $1,277 in 2017 and 2016, respectively. The Company’s future minimum base lease obligations under non-cancelable operating leases are as follows: Year Ending December 31, 2018 $ 928 2019 495 2020 528 Thereafter 3,785 Total $ 5,736 |
Benefit Plans
Benefit Plans | 12 Months Ended |
Dec. 31, 2017 | |
Benefit Plans [Abstract] | |
Benefit Plans | Note 8. Benefit Plans Equity Incentive Plan On May 1, 2012, the Company’s shareholders approved the 2012 Equity Incentive Plan (the “2012 Plan”). The 2012 Plan authorizes the grant of up to 2,000,000 stock options, stock appreciation rights, restricted shares, restricted stock units, performance shares, performance units and other awards for the purpose of providing the Company’s non-employee directors, consultants, officers and other employees incentives and rewards for superior performance. In 2017, a total of 182,000 restricted shares, with an estimated fair value of $646, were issued under the 2012 Plan. In 2016, a total of 180,000 restricted shares, with an estimated fair value of $741, were issued under the 2012 Plan. The estimated fair value of the restricted shares issued under the 2012 Plan for 2017 and 2016 was based on the common stock price at date of grant. Vesting of restricted shares generally occurs after a one to three year period. There were no stock options granted or outstanding under the 2012 Plan in 2017 or 2016. Shares available for future grant at December 31, 2017 and 2016 were 1,241,200 and 1,423,200, respectively. 401(k) Plan The Company initiated an employees’ savings plan (the “Plan”) qualified under Section 401(k) of the Internal Revenue Code in May 1995. The Plan covers substantially all of the Company’s employees. Effective January 1, 2009, the Company modified the Plan such that the Plan would operate on a safe harbor basis. Under the Plan, employees may defer up to 50% of their compensation, not to exceed the annual deferral limit. The Company’s total matching contribution for 2017 and 2016 was $237 and $223, respectively, and consisted of a contribution equal to 35% of up to the first 6% of each participant’s contributions. In addition to the matching contribution, the Company also provided a 3% safe harbor non-elective contribution in 2017 and 2016 of $450 and $433, respectively. All contributions were made in cash. Participants are 100% vested in their own contributions and the vested percentage attributable to certain employer contributions is based on a five year graded schedule. Agent Stock Purchase Plan The Company initiated a nonqualified stock purchase plan (the “Agent Stock Purchase Plan”) in May 2012. The purpose of the Agent Stock Purchase Plan is to promote and advance the interests of the Company and its shareholders by providing independent agents who qualify as participants with an opportunity to purchase the common stock of the Company. Under the Agent Stock Purchase Plan, payment for shares of common stock of the Company is made by either deduction from an agent’s commission payment or a direct cash payment. Stock purchases are made at the end of each calendar quarter at the then current market value. |
Preferred Stock
Preferred Stock | 12 Months Ended |
Dec. 31, 2017 | |
Preferred Stock [Abstract] | |
Preferred Stock | Note 9. Preferred Stock The Company had 55,000 shares of Series D preferred stock (“Series D Preferred Stock”) outstanding at December 31, 2017 and 2016, respectively. All of the shares of Series D Preferred Stock are held by an affiliate of the Company’s controlling shareholder. The outstanding shares of Series D Preferred Stock have a stated value of $100 per share; accrue annual dividends at a rate of $7.25 per share (payable in cash or shares of the Company’s common stock at the option of the board of directors of the Company) and are cumulative. In certain circumstances, the shares of the Series D Preferred Stock may be convertible into an aggregate of approximately 1,378,000 shares of the Company’s common stock, subject to certain adjustments and provided that such adjustments do not result in the Company issuing more than approximately 2,703,000 shares of common stock without obtaining prior shareholder approval; and are redeemable solely at the Company’s option. The Series D Preferred Stock is not currently convertible. The Company had accrued, but unpaid, dividends, on the Series D Preferred Stock of $18 at December 31, 2017 and 2016. During each of 2017 and 2016, the Company paid Series D Preferred Stock dividends of $399. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Common Share [Abstract] | |
Earnings Per Common Share | Note 10. Earnings Per Common Share A reconciliation of the numerator and denominator of the earnings per common share calculations is as follows: For the Year Ended December 31, 2017 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share Net income before preferred stock dividends $ 4,528 20,431 Less preferred stock dividends (399 ) — Net income applicable to common shareholders $ 4,129 20,431 $ .20 For the Year Ended December 31, 2016 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share Net income before preferred stock dividends $ 2,636 20,445 Less preferred stock dividends (399 ) — Net income applicable to common shareholders $ 2,237 20,445 $ .11 The assumed conversion of the Company’s Series D Preferred Stock was excluded from the earnings per common share calculation for 2017 and 2016 since its impact would have been antidilutive. |
Statutory Reporting
Statutory Reporting | 12 Months Ended |
Dec. 31, 2017 | |
Statutory Reporting [Abstract] | |
Statutory Reporting | Note 11. Statutory Reporting The assets, liabilities and results of operations have been reported on the basis of GAAP, which varies in some respects from statutory accounting practices (“SAP”) prescribed or permitted by insurance regulatory authorities. The principal differences between SAP and GAAP are that under SAP: (i) certain assets that are non-admitted assets are eliminated from the balance sheet; (ii) acquisition costs for policies are expensed as incurred, while they are deferred and amortized over the estimated life of the policies under GAAP; (iii) the provision that is made for deferred income taxes is different than under GAAP; (iv) the timing of establishing certain reserves is different than under GAAP; and (v) certain valuation allowances attributable to certain investments are different. The amount of reported statutory net income and surplus (shareholders’ equity) for the Parent’s insurance subsidiaries for the years ended December 31 was as follows: 2017 2016 Life and Health, net income (loss) $ (2,880 ) $ 1,133 Property and Casualty, net income 6,647 6,470 Statutory net income $ 3,767 $ 7,603 Life and Health, surplus $ 34,135 $ 33,430 Property and Casualty, surplus 43,348 41,489 Statutory surplus $ 77,483 $ 74,919 Under the insurance code of the state in which each insurance subsidiary is domiciled, dividend payments to the Parent by its insurance subsidiaries are subject to certain limitations without the prior approval of the applicable state’s Insurance Commissioner. The Parent received dividends of $4,850 and $5,508 in 2017 and 2016, respectively, from its subsidiaries. In 2018, dividend payments to the Parent by the insurance subsidiaries in excess of $4,761 would require prior approval. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Note 12. Related Party Transactions In the normal course of business the Company has engaged in transactions with entities affiliated with the controlling shareholder of the Company. These transactions include the leasing of office space as well as certain investing and financing activities. At December 31, 2017, two members of the Company’s board of directors, including our chairman, president and chief executive officer, were considered to be affiliates of the majority shareholder. The Company leases approximately 49,586 square feet of office and covered garage space from one such controlled entity. During the years ended December 31, 2017 and 2016, the Company paid $866 and $882, respectively, under this lease. Certain financing for the Company has also been provided by this entity in the form of an investment in the Series D Preferred Stock (See Note 9). During the years ended December 31, 2017 and 2016, the Company paid this entity $399 in dividends on the Series D Preferred Stock. Certain members of the Company’s management and board of directors are shareholders and on the board of directors of Gray Television, Inc. (“Gray”). As of December 31, 2017 and 2016, the Company owned 880,272 shares of Gray Class A common stock and 106,000 shares of Gray common stock. The aggregate carrying value of these investments in Gray at December 31, 2017 and 2016 was $14,407 and $10,305, respectively. During the years ended December 31, 2017 and 2016, the Company paid approximately $54 and $215, respectively, to a digital marketing services organization, which is an affiliate of Gray. Services purchased primarily included assistance with website marketing initiatives on behalf of the Company’s life and health operations. During the years ended December 31, 2017 and 2016, Gray paid the Company approximately $597 and $478, respectively, in employer paid insurance premiums related to a group accident plan. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2017 | |
Segment Information [Abstract] | |
Segment Information | Note 13. Segment Information The Parent’s primary insurance subsidiaries operate with relative autonomy and each company is evaluated based on its individual performance. American Southern operates in the property and casualty insurance market, while Bankers Fidelity operates in the life and health insurance market. Each segment derives revenue from the collection of premiums, as well as from investment income. Substantially all revenue other than that in the corporate and other segment is from external sources. For the Year Ended December 31, 2017 American Southern Bankers Fidelity Corporate & Other Adjustments & Eliminations Consolidated Insurance premiums $ 53,661 $ 109,666 $ — $ — $ 163,327 Insurance benefits and losses incurred 34,486 83,029 — — 117,515 Expenses deferred (8,062 ) (6,287 ) — — (14,349 ) Amortization and depreciation expense 8,543 2,825 712 — 12,080 Other expenses 15,951 38,196 16,191 (9,826 ) 60,512 Total expenses 50,918 117,763 16,903 (9,826 ) 175,758 Underwriting income (loss) 2,743 (8,097 ) Investment income 3,332 5,021 2,267 (2,124 ) 8,496 Other income 11 8 7,806 (7,702 ) 123 Operating income (loss) 6,086 (3,068 ) (6,830 ) — (3,812 ) Net realized gains 2,481 2,800 3,887 — 9,168 Income (loss) before income taxes $ 8,567 $ (268 ) $ (2,943 ) $ — $ 5,356 Total revenues $ 59,485 $ 117,495 $ 13,960 $ (9,826 ) $ 181,114 Intangibles $ 1,350 $ 1,194 $ — $ — $ 2,544 Total assets $ 126,313 $ 185,624 $ 147,653 $ (116,351 ) $ 343,239 For the Year Ended December 31, 2016 American Southern Bankers Fidelity Corporate & Other Adjustments & Eliminations Consolidated Insurance premiums $ 53,763 $ 99,702 $ — $ — $ 153,465 Insurance benefits and losses incurred 34,408 68,789 — — 103,197 Expenses deferred (7,834 ) (5,159 ) — — (12,993 ) Amortization and depreciation expense 8,709 3,667 713 — 13,089 Other expenses 15,562 37,258 15,761 (9,321 ) 59,260 Total expenses 50,845 104,555 16,474 (9,321 ) 162,553 Underwriting income (loss) 2,918 (4,853 ) Investment income 3,868 5,725 2,217 (1,926 ) 9,884 Other income — 10 7,518 (7,395 ) 133 Operating income (loss) 6,786 882 (6,739 ) — 929 Net realized gains (losses) 528 2,068 (1 ) — 2,595 Income (loss) before income taxes $ 7,314 $ 2,950 $ (6,740 ) $ — $ 3,524 Total revenues $ 58,159 $ 107,505 $ 9,734 $ (9,321 ) $ 166,077 Intangibles $ 1,350 $ 1,194 $ — $ — $ 2,544 Total assets $ 123,721 $ 168,657 $ 138,694 $ (112,472 ) $ 318,600 |
Disclosures About Fair Value of
Disclosures About Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2017 | |
Disclosures About Fair Value of Financial Instruments [Abstract] | |
Disclosures About Fair Value of Financial Instruments | Note 14. Disclosures About Fair Value of Financial Instruments 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 December 31, 2017 and 2016. Level in Fair Value Hierarchy (1) 2017 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Assets: Cash and cash equivalents Level 1 $ 24,547 $ 24,547 $ 13,252 $ 13,252 Fixed maturities (1) 215,108 215,108 210,670 210,670 Equity securities (1) 23,355 23,355 20,257 20,257 Other invested assets Level 3 5,626 5,626 9,709 9,709 Policy loans Level 2 2,146 2,146 2,265 2,265 Real estate Level 2 38 38 38 38 Investments 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 2 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. The following describes the methods and assumptions used by the Company in estimating fair values: Cash and Cash Equivalents The carrying amount approximates fair value due to the short-term nature of the instruments. Fixed Maturities and Common and Non-Redeemable Preferred Stocks The carrying amount is determined in accordance with methods prescribed by the NAIC, which do not differ materially from publicly quoted market prices. Certain fixed maturities do not have publicly quoted values and 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 discounted at reasonable estimated rates of interest. Other qualitative and quantitative information received from the original underwriter of the pooled offerings is also considered, as applicable. Non-publicly Traded Invested Assets The fair value of investments in certain limited partnerships which are included in other invested assets on the consolidated balance sheet were determined by officers of those limited partnerships. Junior Subordinated Debentures The fair value is estimated based on the quoted market prices for similar issues and the current rates offered for debt having similar returns and remaining maturities. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 12 Months Ended |
Dec. 31, 2017 | |
Accumulated Other Comprehensive Income [Abstract] | |
Accumulated Other Comprehensive Income | Note 15. Accumulated Other Comprehensive Income The following table sets forth the balance of the only component of accumulated other comprehensive income as of December 31, 2017 and 2016, and the changes in the balance of that component during 2017. Unrealized Gains on Available-for- Sale Securities Balance, December 31, 2016 $ 5,830 Other comprehensive income before reclassifications 9,880 Amounts reclassified from accumulated other comprehensive income (5,959 ) Net current period other comprehensive income 3,921 Balance, December 31, 2017 $ 9,751 |
Schedule II CONDENSED FINANCIAL
Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT | 12 Months Ended |
Dec. 31, 2017 | |
Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT [Abstract] | |
Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT | CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) BALANCE SHEETS ASSETS December 31, 2017 2016 (In thousands) Cash and cash equivalents $ 9,732 $ 4,308 Investments 16,097 16,160 Investment in subsidiaries 116,351 112,472 Investments in unconsolidated trusts 1,238 1,238 Income taxes receivable from subsidiaries 2,879 2,961 Other assets 3,762 4,554 Total assets $ 150,059 $ 141,693 LIABILITIES AND SHAREHOLDERS’ EQUITY Deferred tax liability, net $ 1,253 $ 500 Other payables 2,085 1,949 Junior subordinated debentures 33,738 33,738 Total liabilities 37,076 36,187 Shareholders’ equity 112,983 105,506 Total liabilities and shareholders’ equity $ 150,059 $ 141,693 CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) STATEMENTS OF OPERATIONS Year Ended December 31, 2017 2016 (In thousands) REVENUE Fee income from subsidiaries $ 7,702 $ 7,395 Distributed earnings from subsidiaries 4,850 5,508 Other 4,130 408 Total revenue 16,682 13,311 GENERAL AND ADMINISTRATIVE EXPENSES 13,015 12,858 INTEREST EXPENSE 1,723 1,562 1,944 (1,109 ) INCOME TAX BENEFIT (1) (2,553 ) (1,837 ) 4,497 728 EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES, NET 31 1,908 NET INCOME $ 4,528 $ 2,636 (1) Under the terms of a tax-sharing agreement, income tax provisions for the subsidiary companies are computed on a separate company basis. Accordingly, the Company’s income tax benefit results from the utilization of the Parent’s separate return loss to reduce the consolidated taxable income of the Company. CONDENSED FINANCIAL INFORMATION OF REGISTRANT ATLANTIC AMERICAN CORPORATION (Parent Company Only) STATEMENTS OF CASH FLOWS Year Ended December 31, 2017 2016 (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 4,528 $ 2,636 Adjustments to reconcile net income to net cash provided by operating activities: Realized investment (gains) losses, net (3,891 ) 1 Depreciation and amortization 712 713 Compensation expense related to share awards 495 586 Equity in undistributed earnings of consolidated subsidiaries (31 ) (1,908 ) Decrease (increase) in intercompany taxes 82 (815 ) Deferred income tax benefit (1,358 ) (2 ) Increase (decrease) in other liabilities 136 (224 ) Other, net 295 (221 ) Net cash provided by operating activities 968 766 CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from investments sold, called or matured 6,014 1,979 Investments purchased — (1,000 ) Capital contribution to subsidiaries — (75 ) Additions to property and equipment (91 ) (371 ) Net cash provided by investing activities 5,923 533 CASH FLOWS FROM FINANCING ACTIVITIES: Payment of dividends on Series D preferred stock (399 ) (399 ) Payment of dividends on common stock (408 ) (408 ) Proceeds from shares issued under stock plans 32 51 Purchases of shares for treasury (692 ) (698 ) Net cash used in financing activities (1,467 ) (1,454 ) Net increase (decrease) in cash 5,424 (155 ) Cash and cash equivalents at beginning of year 4,308 4,463 Cash and cash equivalents at end of year $ 9,732 $ 4,308 Supplemental disclosure: Cash paid for interest $ 1,705 $ 1,544 Cash paid for income taxes $ 1,400 $ 675 Intercompany tax settlement from subsidiaries $ 2,676 $ 2,845 |
Schedule III SUPPLEMENTARY INSU
Schedule III SUPPLEMENTARY INSURANCE INFORMATION | 12 Months Ended |
Dec. 31, 2017 | |
Schedule III SUPPLEMENTARY INSURANCE INFORMATION [Abstract] | |
Schedule III SUPPLEMENTARY INSURANCE INFORMATION | ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTARY INSURANCE INFORMATION Segment Deferred Acquisition Costs Future Policy Benefits, Losses, Claims and Loss Reserves Unearned Premiums Other Policy Claims and Benefits Payable (In thousands) December 31, 2017: Bankers Fidelity $ 30,619 $ 100,127 $ 4,271 $ 2,010 American Southern 2,075 47,997 19,178 — $ 32,694 $ 148,124 (1) $ 23,449 $ 2,010 December 31, 2016: Bankers Fidelity $ 26,791 $ 87,849 $ 3,731 $ 2,066 American Southern 2,184 49,556 19,477 — $ 28,975 $ 137,405 (2) $ 23,208 $ 2,066 (1) Includes future policy benefits of $82,435 and losses and claims of $65,689. (2) Includes future policy benefits of $74,843 and losses and claims of $62,562. ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTARY INSURANCE INFORMATION Segment Premium Revenue Net Investment Income Benefits, Claims, Losses and Settlement Expenses Amortization of Deferred Acquisition Costs Other Operating Expenses Casualty Premiums Written (In thousands) December 31, 2017: Bankers Fidelity $ 109,666 $ 4,257 $ 83,029 $ 2,460 $ 32,274 $ — American Southern 53,661 3,307 34,486 8,170 8,262 53,362 Other — 143 — — 7,077 — $ 163,327 $ 7,707 $ 117,515 $ 10,630 $ 47,613 $ 53,362 December 31, 2016: Bankers Fidelity $ 99,702 $ 5,172 $ 68,789 $ 3,401 $ 32,365 $ — American Southern 53,763 3,844 34,408 8,483 7,954 51,477 Other — 291 — — 7,153 — $ 153,465 $ 9,307 $ 103,197 $ 11,884 $ 47,472 $ 51,477 |
Schedule IV REINSURANCE
Schedule IV REINSURANCE | 12 Months Ended |
Dec. 31, 2017 | |
Schedule IV REINSURANCE [Abstract] | |
Schedule IV REINSURANCE | ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES REINSURANCE Direct Amount Ceded To Other Companies Assumed From Other Companies Net Amounts Percentage of Amount Assumed To Net (Dollars in thousands) Year ended December 31, 2017: Life insurance in force $ 255,506 $ (14,902 ) $ — $ 240,604 Premiums — Bankers Fidelity $ 142,210 $ (32,585 ) $ 41 $ 109,666 0.0 % American Southern 39,248 (4,787 ) 19,200 53,661 35.8 % Total premiums $ 181,458 $ (37,372 ) $ 19,241 $ 163,327 11.8 % Year ended December 31, 2016: Life insurance in force $ 263,567 $ (16,087 ) $ — $ 247,480 Premiums — Bankers Fidelity $ 104,996 $ (5,344 ) $ 50 $ 99,702 0.1 % American Southern 39,343 (4,654 ) 19,074 53,763 35.5 % Total premiums $ 144,339 $ (9,998 ) $ 19,124 $ 153,465 12.5 % |
Schedule VI SUPPLEMENTAL INFORM
Schedule VI SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS | 12 Months Ended |
Dec. 31, 2017 | |
Schedule VI SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS [Abstract] | |
Schedule VI SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS | ATLANTIC AMERICAN CORPORATION AND SUBSIDIARIES SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS Year Ended Deferred Policy Acquisition Costs Reserves Unearned Premiums Earned Premiums Net Investment Income Claims and Claim Adjustment Expenses Incurred Related To Amortization of Deferred Acquisition Costs Paid Claims and Claim Adjustment Expenses Premiums Written Current Year Prior Years (In thousands) December 31, 2017 $ 2,075 $ 47,997 $ 19,178 $ 53,661 $ 3,307 $ 37,016 $ (2,530 ) $ 8,170 $ 33,459 $ 53,362 December 31, 2016 $ 2,184 $ 49,556 $ 19,477 $ 53,763 $ 3,844 $ 36,541 $ (2,133 ) $ 8,483 $ 34,219 $ 51,477 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2017 | |
Summary of Significant Accounting Policies [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying consolidated financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America (“GAAP”) which, for insurance companies, differ in some respects from the statutory accounting practices prescribed or permitted by regulatory authorities. These financial statements include the accounts of Atlantic American Corporation (“Atlantic American” or the “Parent”) and its subsidiaries (collectively with the Parent, the “Company”). All significant intercompany accounts and transactions have been eliminated in consolidation. Operating results achieved in any historical period are not necessarily indicative of results to be expected in any future period. At December 31, 2017, the Parent owned four insurance subsidiaries, Bankers Fidelity Life Insurance Company and its wholly-owned subsidiary, Bankers Fidelity Assurance Company (together known as “Bankers Fidelity”), and American Southern Insurance Company and its wholly-owned subsidiary, American Safety Insurance Company (together known as “American Southern”), in addition to one non-insurance subsidiary, xCalibre Risk Services, Inc. The Parent has issued a guarantee of all liabilities of Bankers Fidelity. |
Premium Revenue and Cost Recognition | Premium Revenue and Cost Recognition Life insurance premiums are recognized as revenue when due; accident and health insurance premiums are recognized as revenue over the premium paying period and property and casualty insurance premiums are recognized as revenue over the period of the contract in proportion to the amount of insurance protection provided. Losses, benefits and expenses are accrued as incurred and are associated with premiums as they are earned so as to result in recognition of profits over the lives of the contracts. For traditional life insurance and long-duration health insurance, this association is accomplished by the provision of a future policy benefits reserve and the deferral and subsequent amortization of the costs of acquiring business, which are referred to as “deferred policy acquisition costs” (principally commissions, premium taxes, and other incremental direct costs of issuing policies). Deferred policy acquisition costs are amortized over the estimated premium-paying period of the related policies using assumptions consistent with those used in computing the policy benefits reserve. The Company provides for insurance benefits and losses on accident, health, and property-casualty claims based upon estimates of projected ultimate losses. Deferred policy acquisition costs for property and casualty insurance and short-duration health insurance are amortized over the effective period of the related insurance policies. Contingent commissions, if contractually applicable, are ultimately payable to agents based on the underlying profitability of a particular insurance contract or a group of insurance contracts, and are periodically evaluated and accrued as earned. In periods in which revisions are made to the estimated loss reserves related to the particular insurance contract or group of insurance contracts subject to such commissions, corresponding adjustments are also made to the related accruals. Deferred policy acquisition costs are expensed when such costs are deemed not to be recoverable from future premiums (for traditional life and long-duration health insurance) and from the related unearned premiums and investment income (for property and casualty and short-duration health insurance). |
Intangibles | Intangibles Intangibles consist of goodwill and other indefinite-lived intangible assets. Goodwill represents the excess of cost over the fair value of net assets acquired and is not amortized. Other indefinite-lived intangibles represent the value of licenses and are not amortized. The Company periodically reviews its goodwill and other indefinite-lived intangibles to determine if any adverse conditions exist that could indicate impairment. Conditions that could trigger impairment include, but are not limited to, a significant change in business climate that could affect the value of the related asset, an adverse action, or an assessment by a regulator. No impairment of the Company’s recorded intangibles was identified during any of the periods presented. |
Investments | Investments The Company’s investments in both fixed maturities, which include bonds and redeemable preferred stocks, and equity securities, which include common and non-redeemable preferred stocks, are classified as “available-for-sale” and, accordingly, are carried at fair value with the after-tax difference from amortized cost, as adjusted if applicable, reflected in shareholders’ equity as a component of accumulated other comprehensive income or loss. The fair values of fixed maturities and equity securities are largely determined by either independent methods prescribed by the National Association of Insurance Commissioners (“NAIC”), which do not differ materially from publicly quoted market prices, when available, or independent broker quotations. The Company owns certain fixed maturities that do not have publicly quoted market values, but had an estimated fair value as determined by management of $1,369 and $1,264 at December 31, 2017 and 2016, respectively. Such values inherently involve a greater degree of judgment and uncertainty and therefore ultimately greater price volatility than the value of securities with publicly quoted market values. Policy loans and real estate are carried at historical cost. Other invested assets are comprised of investments in limited partnerships, limited liability companies, and real estate joint ventures, and are accounted for using the equity method. If the value of a common stock, preferred stock, other invested asset, or publicly traded bond declines below its cost or amortized cost, as applicable, and the decline is considered to be other than temporary, a realized loss is recorded to reduce the carrying value of the investment to its estimated fair value, which becomes the new cost basis. 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. Premiums and discounts related to investments are amortized or accreted over the life of the related investment as an adjustment to yield using the effective interest method. Dividends and interest income are recognized when earned or declared. The cost of securities sold is based on specific identification. Unrealized gains (losses) in the value of invested assets are accounted for as a direct increase (decrease) in accumulated other comprehensive income in shareholders’ equity, net of deferred tax and, accordingly, have no effect on net income. |
Income Taxes | Income Taxes Deferred income taxes represent the expected future tax consequences when the reported amounts of assets and liabilities are recovered or paid. They arise from differences between the financial reporting and tax basis of assets and liabilities and are adjusted for changes in tax laws and tax rates as those changes are enacted. The provision for income taxes represents the total amount of income taxes due related to the current year, plus the change in deferred income taxes during the year. A valuation allowance is recognized if, based on management’s assessment of the relevant facts, it is more likely than not that some portion of a deferred tax asset will not be realized. |
Earnings Per Common Share | Earnings Per Common Share Basic earnings per common share are based on the weighted average number of common and participating shares outstanding during the relevant period. Diluted earnings per common share are based on the weighted average number of common and participating shares outstanding during the relevant period, plus options outstanding, if applicable, using the treasury stock method and the assumed conversion of the Series D preferred stock, if dilutive. Unless otherwise indicated, earnings per common share amounts are presented on a diluted basis. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of cash on hand and investments in short-term, highly liquid securities with original maturities of three months or less from date of purchase. |
Recently Issued Accounting Standards | Recently Issued Accounting Standards 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 (“ASU 2018-02”). The FASB issued this guidance for the effect on deferred tax assets and liabilities related to items recorded in accumulated other comprehensive income (“AOCI”) resulting from legislated tax reform enacted on December 22, 2017. The tax reform reduced the federal tax rate applied to the Company’s deferred tax balances from 35% to 21% on enactment. Under current GAAP, the Company recorded the total effect of the change in enacted tax rates on deferred tax balances in the income tax expense component of net income. ASU 2018-02 permits the Company to reclassify out of AOCI and into retained earnings the “stranded” tax effects that resulted from recording the tax effects of unrealized investment gains at a 35% tax rate because the 14 point reduction in tax rate was recognized in net income instead of other comprehensive income. The Company will adopt the new guidance as of January 1, 2018. As a result of the reclassification, on January 1, 2018, the Company will reclassify $2,100 of stranded tax effects related to continuing operations which will have the effect of reducing AOCI and increasing retained earnings. In March 2017, the FASB issued ASU No. 2017-08, Receivables – Nonrefundable Fees and Other Costs (Subtopic 310-20): Premium Amortization on Purchased Callable Debt Securities (“ASU 2017-08”). This guidance shortens the amortization period for certain callable debt securities held at a premium to the earliest call date. Under current GAAP, premiums and discounts on callable securities generally are amortized to the maturity date. ASU 2017-08 is effective for interim and annual reporting periods beginning after December 15, 2018, although earlier adoption is permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (“ASU 2017-04”). ASU 2017-04 is intended to simplify the evaluation of goodwill. The updated guidance requires recognition and measurement of goodwill impairment based on the excess of the carrying value of the reporting unit compared to its estimated fair value, with the amount of the impairment not to exceed the carrying value of the reporting unit’s goodwill. Under existing guidance, if the reporting unit’s carrying value exceeds its estimated fair value, the Company allocates the fair value of the reporting unit to all of the assets and liabilities of the reporting unit to determine an implied goodwill value. An impairment loss is then recognized for the excess, if any, of the carrying value of the reporting unit’s goodwill compared to the implied goodwill value. The amendments in ASU 2017-04 are effective for interim and annual reporting periods beginning after December 15, 2019. The Company expects to adopt the updated guidance January 1, 2020 on a prospective basis as required, although earlier adoption is permitted. The Company does not expect the adoption of this ASU to have a material impact on its consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments (“ASU 2016-15”). ASU 2016-15 is intended to reduce diversity in practice in how certain transactions are classified in the statement of cash flows. The issues addressed in ASU 2016-15 are: 1) debt prepayment or debt extinguishment costs, 2) settlement of zero-coupon debt instruments, 3) contingent consideration payments made after a business combination, 4) proceeds from the settlement of insurance claims, 5) proceeds from the settlement of corporate-owned life insurance policies, including bank-owned life insurance policies, 6) distributions received from equity method investees, 7) beneficial interests in securitization transactions and 8) separately identifiable cash flows and application of the predominance principle. The amendments in ASU 2016-15 are effective for interim and annual reporting periods beginning after December 15, 2017. The Company does not expect the adoption of this ASU to have an impact on its consolidated statements of cash flows. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 requires entities to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions and reasonable and supportable forecasts. Under current GAAP, entities generally recognize credit losses when it is probable that the loss has been incurred. ASU 2016-13 will remove all recognition thresholds and will require entities to recognize an allowance for credit losses equal to the difference between the amortized cost basis of a financial instrument and the amount of amortized cost that the entity expects to collect over the instrument’s contractual life. ASU 2016-13 also amends the credit loss measurement guidance for available-for-sale (“AFS”) debt securities and beneficial interests in securitized financial assets. Credit losses on AFS debt securities carried at fair value will continue to be measured as other-than-temporary impairments (“OTTI”) when incurred; however, the losses will be recognized through an allowance and no longer as an adjustment to the cost basis. Recoveries of OTTI will be recognized as reversals of valuation allowances and no longer accreted as investment income through an adjustment to the investment yield. The allowance on AFS debt securities cannot cause the net carrying value to be below fair value and, therefore, it is possible that increases in fair value due to decreases in market interest rates could cause the reversal of a valuation allowance and increase net income. The new guidance will also require purchased financial assets with a more-than-insignificant amount of credit deterioration since original issuance to be recorded based on contractual amounts due and an initial allowance recorded at the date of purchase. For the Company, the amendments in ASU 2016-13 will be effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. The Company has not yet determined the timing of adoption. Implementation matters yet to be addressed include determining the impact of valuation allowances on the effective interest method for recognizing interest income from AFS debt securities as well as updating our investment accounting system functionality to adjust valuation allowances based on changes in fair value. The estimated effect on the Company’s financial statements can only be estimated based on the current investment portfolio at any given point in time, and accordingly, has not currently been determined. In March 2016, the FASB issued ASU No. 2016-09, Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting (“ASU 2016-09”). This guidance applies to all entities that issue share-based payment awards to their employees and is designed to simplify several areas of the accounting for share-based payment transactions, including income tax consequences, forfeitures, classification of awards as either equity or liabilities and related classification on the statement of cash flows. ASU 2016-09 requires the excess tax benefit or deficiency on vesting or settlement of awards to be recognized in earnings as an income tax benefit or expense, respectively. The Company adopted ASU 2016-09 as of January 1, 2017. Adoption of ASU 2016-09 did not have a material impact on the Company’s consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-07, Investments – Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting (“ASU 2016-07”). This guidance eliminates the requirement to retroactively adopt the equity method of accounting when an investment qualifies for the use of the equity method as a result of an increase in the level of ownership or degree of influence. Under ASU 2016-07, the equity method investor is required to add the cost of acquiring the additional interest in the investee to the current basis of the previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The Company adopted ASU 2016-07 as of January 1, 2017. Adoption of ASU 2016-07 did not have an impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”). Under this guidance, an entity is required to recognize right-of-use assets and lease liabilities on its balance sheet and disclose key information about leasing arrangements. ASU 2016-02 offers specific accounting guidance for a lessee, a lessor and sale and leaseback transactions. Under ASU 2016-02, lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. Under the new guidance, lessees with operating leases will be required to recognize a liability for the present value of future minimum lease payments with a corresponding asset for the right of use of the property. Under existing guidance, future minimum lease payments on operating leases are commitments that are not recognized as liabilities on the balance sheet. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018 and requires a modified retrospective adoption, with early adoption permitted. The Company does not expect the adoption of ASU 2016-02 to have a material impact on its consolidated financial statements; however, it is expected that assets and liabilities will increase based on the present value of remaining lease payments for the minor number of leases which will be in place at the adoption date. In January 2016, the FASB issued ASU No. 2016-01, Financial Instruments – Overall (Subtopic 825-10) (“ASU 2016-01”). ASU 2016-01 provides updated guidance for the recognition and measurement of financial instruments. The new guidance will require investments in equity securities to be measured at fair value with any changes in valuation reported in net income except for investments that are consolidated or are accounted for under the equity method of accounting. The new guidance will also require a deferred tax asset resulting from net unrealized losses on available-for-sale (AFS) fixed maturities that are recognized in AOCI to be evaluated for recoverability in combination with the Company’s other deferred tax assets. Under existing guidance, the Company measures investments in equity securities, AFS at fair value with changes in fair value reported in other comprehensive income. As required, the Company will adopt the guidance effective January 1, 2018 through a cumulative effect adjustment to retained earnings. Early adoption is not allowed. The impact to the Company will be increased volatility in net income beginning in 2018. Any difference in the evaluation of deferred tax assets may also affect shareholders’ equity. Cash flows will not be affected. The impact will depend on the composition of the Company’s investment portfolio in the future and changes in fair value of the Company’s investments. As of January 1, 2018, the Company will reclassify from AOCI to retained earnings net unrealized gains of $9,825, after tax, related to equity securities, AFS having a fair value of $23,355. Had the new accounting guidance been in place since the beginning of 2017, the Company would have recognized mark-to-market gains of $2,361 after-tax in net income for the year ended December 31, 2017. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) (“ASU 2014-09”). ASU 2014-09 as modified provides guidance for recognizing revenue. The guidance excludes insurance contracts and financial instruments. Revenue is to be recognized when, or as, goods or services are transferred to customers in an amount that reflects the consideration that an entity is expected to be entitled in exchange for those goods or services. This guidance is effective retrospectively on January 1, 2018, with a choice of restating prior periods or recognizing a cumulative effect for contracts in place as of adoption. The Company will adopt ASU 2014-09 on January 1, 2018. Based on current evaluations, the adoption of this ASU will not have a material impact on the Company’s consolidated financial statements. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of financial statements and related disclosures in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and revenues and expenses during the reporting period. Significant estimates and assumptions are used in developing and evaluating deferred income taxes, deferred acquisition costs, insurance reserves, investments, and receivables, among others, and actual results could differ materially from management’s estimates. |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Investments [Abstract ] | |
Investments aggregated by type and industry | Investments were comprised of the following: 2017 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Cost or Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,155 $ 149 $ 511 $ 31,517 Obligations of states and political subdivisions 10,809 630 1 10,180 Corporate securities: Utilities and telecom 21,882 1,709 130 20,303 Financial services 53,686 2,049 453 52,090 Other business – diversified 44,184 1,024 1,349 44,509 Other consumer – diversified 53,200 924 1,477 53,753 Total corporate securities 172,952 5,706 3,409 170,655 Redeemable preferred stocks: Other consumer – diversified 192 — — 192 Total redeemable preferred stocks 192 — — 192 Total fixed maturities 215,108 6,485 3,921 212,544 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,588 624 — 964 Financial services 5,634 851 — 4,783 Other business – diversified 297 250 — 47 Other consumer – diversified 15,836 10,712 — 5,124 Total equity securities 23,355 12,437 — 10,918 Other invested assets 5,626 — — 5,626 Policy loans 2,146 — — 2,146 Real estate 38 — — 38 Investments in unconsolidated trusts 1,238 — — 1,238 Total investments $ 247,511 $ 18,922 $ 3,921 $ 232,510 2016 Carrying Value Gross Unrealized Gains Gross Unrealized Losses Cost or Amortized Cost Fixed maturities: Bonds: U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,102 $ 197 $ 553 $ 31,458 Obligations of states and political subdivisions 17,572 625 308 17,255 Corporate securities: Utilities and telecom 18,034 1,462 88 16,660 Financial services 57,282 1,880 911 56,313 Other business – diversified 57,419 1,071 2,337 58,685 Other consumer – diversified 29,069 471 1,344 29,942 Total corporate securities 161,804 4,884 4,680 161,600 Redeemable preferred stocks: Other consumer – diversified 192 — — 192 Total redeemable preferred stocks 192 — — 192 Total fixed maturities 210,670 5,706 5,541 210,505 Equity securities: Common and non-redeemable preferred stocks: Utilities and telecom 1,601 637 — 964 Financial services 5,402 574 — 4,828 Other business – diversified 244 197 — 47 Other consumer – diversified 13,010 7,396 — 5,614 Total equity securities 20,257 8,804 — 11,453 Other invested assets 9,709 — — 9,709 Policy loans 2,265 — — 2,265 Real estate 38 — — 38 Investments in unconsolidated trusts 1,238 — — 1,238 Total investments $ 244,177 $ 14,510 $ 5,541 $ 235,208 |
Investments aggregated by industry | The following table sets forth the carrying value, cost or amortized cost, and net unrealized gains (losses) of the Company’s investments aggregated by industry as of December 31, 2017 and 2016. 2017 2016 Carrying Value Cost or Amortized Cost Unrealized Gains (Losses) Carrying Value Cost or Amortized Cost Unrealized Gains (Losses) U.S. Treasury securities and obligations of U.S. Government agencies and authorities $ 31,155 $ 31,517 $ (362 ) $ 31,102 $ 31,458 $ (356 ) Obligations of states and political subdivisions 10,809 10,180 629 17,572 17,255 317 Utilities and telecom 23,470 21,267 2,203 19,635 17,624 2,011 Financial services 59,320 56,873 2,447 62,684 61,141 1,543 Other business – diversified 44,481 44,556 (75 ) 57,663 58,732 (1,069 ) Other consumer – diversified 69,228 59,069 10,159 42,271 35,748 6,523 Other investments 9,048 9,048 — 13,250 13,250 — Total investments $ 247,511 $ 232,510 $ 15,001 $ 244,177 $ 235,208 $ 8,969 |
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 December 31, 2017 and 2016. 2017 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 $ 12,175 $ 162 $ 12,737 $ 349 $ 24,912 $ 511 Obligations of states and political subdivisions 999 1 — — 999 1 Corporate securities 40,108 653 32,667 2,756 72,775 3,409 Total temporarily impaired securities $ 53,282 $ 816 $ 45,404 $ 3,105 $ 98,686 $ 3,921 2016 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 $ 23,494 $ 553 $ — $ — $ 23,494 $ 553 Obligations of states and political subdivisions 8,747 308 — — 8,747 308 Corporate securities 59,404 2,124 20,587 2,556 79,991 4,680 Total temporarily impaired securities $ 91,645 $ 2,985 $ 20,587 $ 2,556 $ 112,232 $ 5,541 |
Financial instruments carried at fair value measured on a recurring basis | As of December 31, 2017, financial instruments carried at fair value were measured on a recurring basis as summarized below: Assets: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fixed maturities $ — $ 213,739 $ 1,369 (1) $ 215,108 Equity securities 17,973 5,382 (1) — 23,355 Cash equivalents 13,855 — — 13,855 Total $ 31,828 $ 219,121 $ 1,369 $ 252,318 (1) All underlying securities are financial service industry related. As of December 31, 2016, financial instruments carried at fair value were measured on a recurring basis as summarized below: Assets: Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Total Fixed maturities $ — $ 209,406 $ 1,264 (1) $ 210,670 Equity securities 15,153 5,104 (1) — 20,257 Cash equivalents 9,811 — — 9,811 Total $ 24,964 $ 214,510 $ 1,264 $ 240,738 (1) All underlying securities are financial service industry related. |
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) from January 1, 2016 to December 31, 2017. Fixed Maturities Balance, January 1, 2016 $ 2,237 Total realized gains included in earnings 57 Total unrealized losses included in other comprehensive income (30 ) Settlements (1,000 ) Balance, December 31, 2016 1,264 Total unrealized gains included in other comprehensive income 105 Balance, December 31, 2017 $ 1,369 |
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 December 31, 2017 and 2016 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. 2017 2016 Carrying Value Amortized Cost Carrying Value Amortized Cost Due in one year or less $ 1,653 $ 1,655 $ 2,544 $ 2,507 Due after one year through five years 13,738 14,056 20,278 20,038 Due after five years through ten years 112,847 112,116 90,667 90,926 Due after ten years 67,328 64,928 80,099 79,627 Varying maturities 19,542 19,789 17,082 17,407 Totals $ 215,108 $ 212,544 $ 210,670 $ 210,505 |
Investment income earned | Investment income was earned from the following sources: 2017 2016 Fixed maturities $ 8,297 $ 9,122 Equity securities 467 491 Other (268 ) 271 Total investment income 8,496 9,884 Less investment expenses, included in other expenses (789 ) (577 ) Net investment income $ 7,707 $ 9,307 |
Summary of realized investment gains (losses) | A summary of realized investment gains (losses) follows: 2017 Fixed Maturities Equity Securities Other Invested Assets Total Gains $ 2,226 $ 1,044 $ 6,040 $ 9,310 Losses (142 ) — — (142 ) Realized investment gains, net $ 2,084 $ 1,044 $ 6,040 $ 9,168 2016 Fixed Maturities Equity Securities Other Invested Assets Total Gains $ 1,119 $ — $ 1,565 $ 2,684 Losses (89 ) — — (89 ) Realized investment gains, net $ 1,030 $ — $ 1,565 $ 2,595 |
Proceeds from sales of investments | Proceeds from the sales of investments were as follows: 2017 2016 Fixed maturities $ 72,760 $ 59,072 Equity securities 1,579 — Other investments 9,653 3,289 Total proceeds $ 83,992 $ 62,361 The Company’s bond portfolio included 92% investment grade securities, as defined by the NAIC, at December 31, 2017. |
Insurance Reserves and Policy30
Insurance Reserves and Policyholder Funds (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Liabilities for Unpaid Losses, Claims and Loss Adjustment Expenses [Abstract] | |
Reserves for life, accident, health and property and casualty losses, including loss adjustment expenses | The following table presents the Company’s reserves for life, accident and health, and property and casualty losses, claims and loss adjustment expenses at December 31, 2017 and 2016. Amount of Insurance In Force, Net 2017 2016 2017 2016 Future policy benefits Life insurance policies: Ordinary $ 54,752 $ 54,554 $ 238,534 $ 245,017 Mass market 1,693 2,003 2,070 2,463 Individual annuities 50 84 — — 56,495 56,641 $ 240,604 $ 247,480 Accident and health insurance policies 25,940 18,202 82,435 74,843 Unearned premiums 23,449 23,208 Losses, claims and loss adjustment expenses 65,689 62,562 Other policy liabilities 2,010 2,066 Total insurance reserves and policyholder funds $ 173,583 $ 162,679 |
Summary of activity in liabilities for unpaid loss and claim reserved | Activity in the liability for unpaid loss and claim reserves is summarized as follows: 2017 2016 Balance at January 1 $ 62,562 $ 63,870 Less: Reinsurance recoverable on unpaid losses (10,796 ) (11,741 ) Net balance at January 1 51,766 52,129 Incurred related to: Current year 114,099 103,252 Prior years (1,765 ) (3,377 ) Total incurred 112,334 99,875 Paid related to: Current year 82,092 71,980 Prior years 28,287 28,258 Total paid 110,379 100,238 Net balance at December 31 53,721 51,766 Plus: Reinsurance recoverable on unpaid losses 11,968 10,796 Balance at December 31 $ 65,689 $ 62,562 |
Reconciliation of total incurred losses to total insurance benefits and losses | Following is a reconciliation of total incurred losses to total insurance benefits and losses incurred: 2017 2016 Total incurred losses $ 112,334 $ 99,875 Cash surrender value and matured endowments 1,442 1,278 Benefit reserve changes 3,739 2,044 Total insurance benefits and losses incurred $ 117,515 $ 103,197 |
Information about incurred and paid claims development | The following is information, by significant product lines, about incurred and paid claims development as of December 31, 2017, net of reinsurance, as well as the cumulative number of reported claims and the total of IBNR reserves plus expected development on reported claims included within the net incurred claims amounts. Medicare Supplement For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 29,344 $ 28,698 $ 28,721 $ 28,712 $ 28,688 $ 28,687 $ 28,683 $ 28,683 $ 28,682 $ 28,682 $ — 533,112 2009 31,124 30,455 30,481 30,447 30,438 30,432 30,431 30,430 30,430 — 560,430 2010 34,849 34,328 34,323 34,303 34,282 34,272 34,268 34,265 — 625,695 2011 38,188 38,296 38,360 38,327 38,316 38,302 38,299 — 664,049 2012 50,021 50,996 51,021 50,998 50,989 50,987 — 867,047 2013 56,974 56,970 57,034 57,023 57,021 — 957,350 2014 57,179 56,938 56,981 56,981 — 939,444 2015 55,482 54,939 54,993 — 898,270 2016 58,849 59,851 100 1,034,900 2017 67,960 9,822 1,303,865 $ 479,469 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 24,055 $ 28,698 $ 28,721 $ 28,712 $ 28,688 $ 28,687 $ 28,683 $ 28,683 $ 28,682 $ 28,682 2009 29,866 30,455 30,481 30,447 30,438 30,432 30,431 30,430 30,430 2010 29,127 34,328 34,323 34,303 34,282 34,272 34,268 34,265 2011 31,720 38,296 38,360 38,327 38,316 38,302 38,299 2012 42,267 50,996 51,021 50,998 50,989 50,987 2013 47,770 56,970 57,034 57,023 57,021 2014 48,024 56,938 56,981 56,981 2015 45,430 54,876 54,993 2016 49,165 59,747 2017 57,696 $ 469,101 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 10,368 Automobile Liability For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 9,723 $ 7,011 $ 6,627 $ 6,374 $ 6,124 $ 6,112 $ 6,106 $ 6,104 $ 6,105 $ 6,105 $ — 1,534 2009 10,817 8,891 8,659 8,558 8,245 8,123 8,155 8,154 8,153 — 1,755 2010 10,752 10,818 10,547 9,937 10,068 10,185 10,202 10,201 — 1,947 2011 12,263 13,802 13,235 13,289 13,281 13,495 13,385 30 2,132 2012 12,980 15,007 14,108 13,707 13,313 13,343 22 3,340 2013 18,664 20,702 21,096 21,823 21,352 162 3,260 2014 20,812 21,881 22,041 22,353 816 3,536 2015 18,521 19,857 20,017 1,904 3,492 2016 20,549 21,275 3,049 3,755 2017 22,179 7,311 3,385 $ 158,363 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 2,426 $ 4,202 $ 5,077 $ 5,695 $ 5,839 $ 6,065 $ 6,104 $ 6,104 $ 6,105 $ 6,105 2009 3,250 5,208 6,353 7,502 7,995 8,123 8,155 8,154 8,153 2010 3,211 6,274 8,291 9,382 9,725 10,056 10,090 10,206 2011 4,205 7,934 9,858 12,071 13,039 13,106 13,199 2012 4,627 8,791 11,507 12,932 13,197 13,211 2013 5,144 12,193 16,782 19,407 20,382 2014 6,822 13,807 17,554 20,177 2015 6,226 11,878 14,938 2016 6,796 13,141 2017 7,401 $ 126,913 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 31,450 Automobile Physical Damage For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2013 2014 2015 2016 2017 2013 $ 6,039 $ 5,515 $ 5,536 $ 5,599 $ 5,599 $ — 1,598 2014 8,079 7,657 7,583 7,562 — 1,635 2015 8,287 7,955 7,887 — 1,588 2016 6,877 6,386 3 1,261 2017 6,257 105 1,238 $ 33,691 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2013 2014 2015 2016 2017 2013 $ 4,778 $ 5,486 $ 5,466 $ 5,599 $ 5,599 2014 6,437 7,619 7,570 7,562 2015 6,745 7,937 7,885 2016 5,804 6,353 2017 5,215 $ 32,614 All outstanding liabilities before 2013, net of reinsurance 33 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 1,110 General Liability For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 5,386 $ 4,359 $ 2,858 $ 2,685 $ 2,479 $ 2,489 $ 2,507 $ 2,548 $ 2,647 $ 2,853 $ 23 393 2009 3,392 2,215 1,944 1,730 1,702 1,727 1,828 1,832 1,888 8 290 2010 4,114 2,699 2,269 2,337 2,258 2,400 2,423 2,473 4 289 2011 3,022 1,723 1,452 1,338 1,174 1,242 1,327 11 201 2012 4,055 1,305 1,269 1,270 1,214 1,333 26 157 2013 3,461 728 926 817 865 18 187 2014 3,744 501 557 476 40 192 2015 4,421 1,037 1,227 348 143 2016 3,119 1,148 440 81 2017 1,490 1,241 58 $ 15,080 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 534 $ 1,091 $ 1,637 $ 1,861 $ 2,023 $ 2,123 $ 2,418 $ 2,506 $ 2,564 $ 2,755 2009 476 941 1,082 1,410 1,629 1,662 1,796 1,816 1,855 2010 284 678 1,374 1,542 2,037 2,368 2,382 2,457 2011 295 412 582 835 1,161 1,169 1,278 2012 371 707 847 1,034 1,113 1,219 2013 104 339 579 811 791 2014 171 299 331 369 2015 98 259 464 2016 116 203 2017 75 $ 11,466 All outstanding liabilities before 2008, net of reinsurance 288 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 3,902 Surety For the Years Ended December 31, (Unaudited) As of December 31, 2017 Incurred Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance IBNR Reserves Cumulative Number of Reported Claims Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 3,883 $ 2,098 $ 2,420 $ 2,312 $ 2,312 $ 2,360 $ 2,360 $ 2,324 $ 2,324 $ 2,324 $ — 62 2009 4,920 5,025 4,239 3,951 3,616 4,636 4,916 4,664 4,667 — 83 2010 3,995 4,624 3,618 3,396 3,607 3,549 3,563 3,534 — 95 2011 4,422 4,786 5,080 5,092 4,966 5,031 5,112 — 126 2012 4,979 4,767 5,396 5,345 4,869 4,880 — 87 2013 3,060 2,007 2,743 2,947 2,866 13 57 2014 3,214 3,130 2,990 2,760 4 51 2015 1,902 1,630 1,400 78 49 2016 3,314 1,812 39 45 2017 4,677 2,043 52 $ 34,032 Cumulative Paid Losses, Claims and Allocated Loss Adjustment Expenses, Net of Reinsurance Accident Year 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2008 $ 503 $ 1,369 $ 2,261 $ 2,232 $ 2,311 $ 2,359 $ 2,360 $ 2,324 $ 2,324 $ 2,324 2009 103 1,595 2,640 3,205 3,410 3,760 3,757 4,663 4,666 2010 928 2,193 2,780 2,943 3,252 3,545 3,560 3,534 2011 1,031 3,207 4,622 4,748 4,939 5,022 5,109 2012 2,257 4,581 4,856 5,331 4,869 4,880 2013 323 1,010 1,369 2,763 2,789 2014 1,331 2,327 2,727 2,739 2015 641 856 1,127 2016 1,054 1,732 2017 1,971 $ 30,871 Liabilities for losses, claims and loss adjustment expenses, net of reinsurance $ 3,161 |
Supplementary information about average historical claims duration | The following is supplementary information about average historical claims duration as of December 31, 2017. Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (Unaudited) Reserve Line 1st Year 2nd Year 3rd Year 4th Year 5th Year 6th Year 7th Year 8th Year 9th Year 10th Year Medicare Supplement 83.7 % 16.4 % 0.1 % -0.1 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % 0.0 % Automobile Liability 32.8 % 29.4 % 17.1 % 12.3 % 4.3 % 1.8 % 0.5 % 0.4 % 0.0 % 0.0 % Automobile Physical Damage 86.0 % 13.0 % -0.6 % 1.1 % 0.0 % General Liability 17.7 % 18.8 % 16.2 % 14.3 % 10.9 % 5.4 % 6.6 % 2.4 % 2.0 % 6.7 % Surety 32.2 % 34.2 % 19.6 % 11.0 % 2.0 % 3.9 % 0.5 % 5.7 % 0.0 % 0.0 % |
Reconciliation of net incurred and paid claims development | The reconciliation of the net incurred and paid claims development tables to the liability for losses, claims and loss adjustment expenses is as follows: December 31, 2017 Net outstanding liabilities: Medicare Supplement $ 10,368 Automobile Liability 31,450 Automobile Physical Damage 1,110 General Liability 3,902 Surety 3,161 Other short-duration insurance lines 2,004 Liabilities for unpaid losses, claims and loss adjustment expenses, net of reinsurance 51,995 Reinsurance recoverable on unpaid losses: Medicare Supplement 4,748 Automobile Liability 5,245 Automobile Physical Damage 116 General Liability 1,859 Total reinsurance recoverable on unpaid losses 11,968 Unallocated claims adjustment expenses 1,726 Total gross liability for unpaid losses, claims and loss adjustment expenses $ 65,689 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Reinsurance [Abstract] | |
Effects of reinsurance on premiums written, premiums earned and insurance benefits and losses incurred | The effects of reinsurance on premiums written, premiums earned and insurance benefits and losses incurred were as follows: 2017 2016 Direct premiums written $ 181,568 $ 142,200 Assumed premiums written 19,373 19,123 Ceded premiums written (38,019 ) (10,225 ) Net premiums written $ 162,922 $ 151,098 Direct premiums earned $ 181,458 $ 144,339 Assumed premiums earned 19,241 19,124 Ceded premiums earned (37,372 ) (9,998 ) Net premiums earned $ 163,327 $ 153,465 Provision for benefits and losses incurred $ 147,444 $ 109,616 Reinsurance loss recoveries (29,929 ) (6,419 ) Insurance benefits and losses incurred $ 117,515 $ 103,197 |
Components of reinsurance recoverables | Components of reinsurance recoverables at December 31, 2017 and 2016 were as follows: 2017 2016 Recoverable on unpaid losses $ 11,968 $ 10,796 Recoverable on unpaid benefits 4,403 655 Ceded unearned premiums 874 227 Ceded advanced premiums 368 25 Total reinsurance recoverables $ 17,613 $ 11,703 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Income Taxes [Abstract] | |
Allocation of total income taxes | Total income taxes were allocated as follows: 2017 2016 Total tax expense on income $ 828 $ 888 Tax expense on components of shareholders’ equity: Net unrealized gains on investment securities 2,111 671 Total tax expense $ 2,939 $ 1,559 |
Reconciliation of income tax expense | A reconciliation of the differences between income taxes computed at the federal statutory income tax rate and the income tax expense is as follows: 2017 2016 Federal income tax provision at statutory rate of 35% $ 1,875 $ 1,233 Dividends-received deduction (92 ) (95 ) Small life insurance company deduction (613 ) (376 ) Other 72 55 Remeasurement of deferred taxes due to tax reform enactment (395 ) — Adjustment for prior years’ estimates to actual (19 ) 71 Income tax expense $ 828 $ 888 Effective tax rate 15.5 % 25.2 % |
Deferred tax liabilities and assets | Deferred tax liabilities and assets at December 31, 2017 and 2016 were comprised of the following: 2017 2016 Deferred tax liabilities: Deferred acquisition costs $ (1,200 ) $ (2,345 ) Deferred and uncollected premiums (377 ) (654 ) Net unrealized investment gains (3,150 ) (3,140 ) Other (331 ) (666 ) Total deferred tax liabilities (5,058 ) (6,805 ) Deferred tax assets: Insurance reserves 3,216 4,589 Impaired assets 869 1,454 Alternative minimum tax credit — 282 Bad debts and other 380 640 Total deferred tax assets 4,465 6,965 Net deferred tax asset (liability) $ (593 ) $ 160 |
Components of income tax expense | The components of income tax expense were: 2017 2016 Current - Federal $ 2,186 $ 890 Deferred - Federal (1,358 ) (2 ) Total $ 828 $ 888 |
Junior Subordinated Debentures
Junior Subordinated Debentures (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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 December 31, 2017 and 2016, 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 December 31, 2017 $18,042 $23,196 Less: Treasury debt (3) (7,500) Net balance December 31, 2017 $18,042 $15,696 Net balance December 31, 2016 $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 Atlantic (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) In 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. (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. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Commitments and Contingencies [Abstract] | |
Operating lease commitments | The Company’s future minimum base lease obligations under non-cancelable operating leases are as follows: Year Ending December 31, 2018 $ 928 2019 495 2020 528 Thereafter 3,785 Total $ 5,736 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Earnings Per Common Share [Abstract] | |
Reconciliation of numerator and denominator used in earnings per common share calculations | A reconciliation of the numerator and denominator of the earnings per common share calculations is as follows: For the Year Ended December 31, 2017 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share Net income before preferred stock dividends $ 4,528 20,431 Less preferred stock dividends (399 ) — Net income applicable to common shareholders $ 4,129 20,431 $ .20 For the Year Ended December 31, 2016 Income Shares (In thousands) Per Share Amount Basic and Diluted Earnings Per Common Share Net income before preferred stock dividends $ 2,636 20,445 Less preferred stock dividends (399 ) — Net income applicable to common shareholders $ 2,237 20,445 $ .11 |
Statutory Reporting (Tables)
Statutory Reporting (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Statutory Reporting [Abstract] | |
Reported statutory net income and surplus for the Parent's insurance subsidiaries | The amount of reported statutory net income and surplus (shareholders’ equity) for the Parent’s insurance subsidiaries for the years ended December 31 was as follows: 2017 2016 Life and Health, net income (loss) $ (2,880 ) $ 1,133 Property and Casualty, net income 6,647 6,470 Statutory net income $ 3,767 $ 7,603 Life and Health, surplus $ 34,135 $ 33,430 Property and Casualty, surplus 43,348 41,489 Statutory surplus $ 77,483 $ 74,919 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Segment Information [Abstract] | |
Revenue and income before income taxes for each business unit | The Parent’s primary insurance subsidiaries operate with relative autonomy and each company is evaluated based on its individual performance. American Southern operates in the property and casualty insurance market, while Bankers Fidelity operates in the life and health insurance market. Each segment derives revenue from the collection of premiums, as well as from investment income. Substantially all revenue other than that in the corporate and other segment is from external sources. For the Year Ended December 31, 2017 American Southern Bankers Fidelity Corporate & Other Adjustments & Eliminations Consolidated Insurance premiums $ 53,661 $ 109,666 $ — $ — $ 163,327 Insurance benefits and losses incurred 34,486 83,029 — — 117,515 Expenses deferred (8,062 ) (6,287 ) — — (14,349 ) Amortization and depreciation expense 8,543 2,825 712 — 12,080 Other expenses 15,951 38,196 16,191 (9,826 ) 60,512 Total expenses 50,918 117,763 16,903 (9,826 ) 175,758 Underwriting income (loss) 2,743 (8,097 ) Investment income 3,332 5,021 2,267 (2,124 ) 8,496 Other income 11 8 7,806 (7,702 ) 123 Operating income (loss) 6,086 (3,068 ) (6,830 ) — (3,812 ) Net realized gains 2,481 2,800 3,887 — 9,168 Income (loss) before income taxes $ 8,567 $ (268 ) $ (2,943 ) $ — $ 5,356 Total revenues $ 59,485 $ 117,495 $ 13,960 $ (9,826 ) $ 181,114 Intangibles $ 1,350 $ 1,194 $ — $ — $ 2,544 Total assets $ 126,313 $ 185,624 $ 147,653 $ (116,351 ) $ 343,239 For the Year Ended December 31, 2016 American Southern Bankers Fidelity Corporate & Other Adjustments & Eliminations Consolidated Insurance premiums $ 53,763 $ 99,702 $ — $ — $ 153,465 Insurance benefits and losses incurred 34,408 68,789 — — 103,197 Expenses deferred (7,834 ) (5,159 ) — — (12,993 ) Amortization and depreciation expense 8,709 3,667 713 — 13,089 Other expenses 15,562 37,258 15,761 (9,321 ) 59,260 Total expenses 50,845 104,555 16,474 (9,321 ) 162,553 Underwriting income (loss) 2,918 (4,853 ) Investment income 3,868 5,725 2,217 (1,926 ) 9,884 Other income — 10 7,518 (7,395 ) 133 Operating income (loss) 6,786 882 (6,739 ) — 929 Net realized gains (losses) 528 2,068 (1 ) — 2,595 Income (loss) before income taxes $ 7,314 $ 2,950 $ (6,740 ) $ — $ 3,524 Total revenues $ 58,159 $ 107,505 $ 9,734 $ (9,321 ) $ 166,077 Intangibles $ 1,350 $ 1,194 $ — $ — $ 2,544 Total assets $ 123,721 $ 168,657 $ 138,694 $ (112,472 ) $ 318,600 |
Disclosures About Fair Value 38
Disclosures About Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
Disclosures About Fair Value 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 December 31, 2017 and 2016. Level in Fair Value Hierarchy (1) 2017 2016 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Assets: Cash and cash equivalents Level 1 $ 24,547 $ 24,547 $ 13,252 $ 13,252 Fixed maturities (1) 215,108 215,108 210,670 210,670 Equity securities (1) 23,355 23,355 20,257 20,257 Other invested assets Level 3 5,626 5,626 9,709 9,709 Policy loans Level 2 2,146 2,146 2,265 2,265 Real estate Level 2 38 38 38 38 Investments 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 2 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. |
Accumulated Other Comprehensi39
Accumulated Other Comprehensive Income (Tables) | 12 Months Ended |
Dec. 31, 2017 | |
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 the only component of accumulated other comprehensive income as of December 31, 2017 and 2016, and the changes in the balance of that component during 2017. Unrealized Gains on Available-for- Sale Securities Balance, December 31, 2016 $ 5,830 Other comprehensive income before reclassifications 9,880 Amounts reclassified from accumulated other comprehensive income (5,959 ) Net current period other comprehensive income 3,921 Balance, December 31, 2017 $ 9,751 |
Summary of Significant Accoun40
Summary of Significant Accounting Policies (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($)Subsidiary | Dec. 31, 2016USD ($) | |
Principles of Consolidation [Abstract] | |||
Number of insurance subsidiaries owned by the parent | Subsidiary | 4 | ||
Number of non-insurance subsidiaries owned by the parent | Subsidiary | 1 | ||
Investments | |||
Estimated fair value | $ 1,369 | $ 1,264 | |
Recently Issued Accounting Standards [Abstract] | |||
Federal corporate tax rate | 35.00% | ||
Equity securities available-for-sale | $ 23,355 | $ 20,257 | |
Plan [Member] | |||
Recently Issued Accounting Standards [Abstract] | |||
Federal corporate tax rate | 21.00% | ||
ASU 2016-01 [Member] | |||
Recently Issued Accounting Standards [Abstract] | |||
Equity securities available-for-sale | 23,355 | ||
Equity securities unrealized gains, net of tax | 9,825 | ||
New accounting pronouncement, effect of change on income, net of tax | $ 2,361 | ||
ASU 2018-02 [Member] | Plan [Member] | Retained Earnings [Member] | |||
Recently Issued Accounting Standards [Abstract] | |||
Reclassification of standard tax effects on AOCI and retained earnings | $ 2,100 | ||
ASU 2018-02 [Member] | Plan [Member] | Accumulated Other Comprehensive Income [Member] | |||
Recently Issued Accounting Standards [Abstract] | |||
Reclassification of standard tax effects on AOCI and retained earnings | $ (2,100) |
Investments, Aggregated by Type
Investments, Aggregated by Type and Industry (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)SecuritiesIssuer | Dec. 31, 2016USD ($)Securities | |
Investments aggregated by type and industry [Abstract] | ||
Carrying value | $ 215,108 | $ 210,670 |
Gross unrealized gains | 6,485 | 5,706 |
Gross unrealized losses | 3,921 | 5,541 |
Cost or amortized cost | 212,544 | 210,505 |
Carrying value | 23,355 | 20,257 |
Gross unrealized gains | 12,437 | 8,804 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 10,918 | 11,453 |
Other invested assets | 5,626 | 9,709 |
Other invested assets, cost or amortized cost | 5,626 | 9,709 |
Policy loans | 2,146 | 2,265 |
Policy loans, cost or amortized cost | 2,146 | 2,265 |
Real estate | 38 | 38 |
Real estate, cost or amortized cost | 38 | 38 |
Investment in unconsolidated trusts | 1,238 | 1,238 |
Investment in unconsolidated trusts, cost or amortized cost | 1,238 | 1,238 |
Total investments | 247,511 | 244,177 |
Total investments, gross unrealized gains | 18,922 | 14,510 |
Total investments, gross unrealized losses | 3,921 | 5,541 |
Total investments, cost or amortized cost | 232,510 | 235,208 |
Amortized cost of bonds on deposit with insurance regulatory authorities | $ 11,178 | $ 11,435 |
Number of securities in unrealized loss position | Securities | 69 | 77 |
Oil and Gas Properties [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Gross unrealized losses | $ 906 | |
Fixed maturity investments, number of issuers | Issuer | 4 | |
Fixed Maturities - U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | $ 31,155 | $ 31,102 |
Gross unrealized gains | 149 | 197 |
Gross unrealized losses | 511 | 553 |
Cost or amortized cost | 31,517 | 31,458 |
Fixed Maturities - Obligations of States and Political Subdivisions [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 10,809 | 17,572 |
Gross unrealized gains | 630 | 625 |
Gross unrealized losses | 1 | 308 |
Cost or amortized cost | 10,180 | 17,255 |
Fixed Maturities - Corporate Securities [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 172,952 | 161,804 |
Gross unrealized gains | 5,706 | 4,884 |
Gross unrealized losses | 3,409 | 4,680 |
Cost or amortized cost | 170,655 | 161,600 |
Fixed Maturities - Utilities and Telecom [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 21,882 | 18,034 |
Gross unrealized gains | 1,709 | 1,462 |
Gross unrealized losses | 130 | 88 |
Cost or amortized cost | 20,303 | 16,660 |
Fixed Maturities - Financial Services [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 53,686 | 57,282 |
Gross unrealized gains | 2,049 | 1,880 |
Gross unrealized losses | 453 | 911 |
Cost or amortized cost | 52,090 | 56,313 |
Fixed Maturities - Other Business - Diversified [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 44,184 | 57,419 |
Gross unrealized gains | 1,024 | 1,071 |
Gross unrealized losses | 1,349 | 2,337 |
Cost or amortized cost | 44,509 | 58,685 |
Fixed Maturities - Other Consumer - Diversified [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 53,200 | 29,069 |
Gross unrealized gains | 924 | 471 |
Gross unrealized losses | 1,477 | 1,344 |
Cost or amortized cost | 53,753 | 29,942 |
Fixed Maturities - Redeemable Preferred Stocks [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 192 | 192 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 192 | 192 |
Fixed Maturities - Other Consumer Diversified [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 192 | 192 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 192 | 192 |
Equity Securities - Utilities and Telecom [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 1,588 | 1,601 |
Gross unrealized gains | 624 | 637 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 964 | 964 |
Equity Securities - Financial Services [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 5,634 | 5,402 |
Gross unrealized gains | 851 | 574 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 4,783 | 4,828 |
Equity Securities - Other Business Diversified [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 297 | 244 |
Gross unrealized gains | 250 | 197 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | 47 | 47 |
Equity Securities - Other Consumer Diversified [Member] | ||
Investments aggregated by type and industry [Abstract] | ||
Carrying value | 15,836 | 13,010 |
Gross unrealized gains | 10,712 | 7,396 |
Gross unrealized losses | 0 | 0 |
Cost or amortized cost | $ 5,124 | $ 5,614 |
Investments, Aggregated by Indu
Investments, Aggregated by Industry (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Investments aggregated by industry [Abstract] | ||
Carrying value | $ 215,108 | $ 210,670 |
Cost or amortized cost | 212,544 | 210,505 |
Carrying value | 247,511 | 244,177 |
Cost or amortized cost | 232,510 | 235,208 |
Unrealized gains (losses) | 15,001 | 8,969 |
Fixed Maturities - U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 31,155 | 31,102 |
Cost or amortized cost | 31,517 | 31,458 |
Unrealized gains (losses) | (362) | (356) |
Fixed Maturities - Obligations of States and Political Subdivisions [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 10,809 | 17,572 |
Cost or amortized cost | 10,180 | 17,255 |
Unrealized gains (losses) | 629 | 317 |
Utilities and Telecom [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 23,470 | 19,635 |
Cost or amortized cost | 21,267 | 17,624 |
Unrealized gains (losses) | 2,203 | 2,011 |
Financial Services [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 59,320 | 62,684 |
Cost or amortized cost | 56,873 | 61,141 |
Unrealized gains (losses) | 2,447 | 1,543 |
Other Business - Diversified [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 44,481 | 57,663 |
Cost or amortized cost | 44,556 | 58,732 |
Unrealized gains (losses) | (75) | (1,069) |
Other Consumer - Diversified [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 69,228 | 42,271 |
Cost or amortized cost | 59,069 | 35,748 |
Unrealized gains (losses) | 10,159 | 6,523 |
Other Investments [Member] | ||
Investments aggregated by industry [Abstract] | ||
Carrying value | 9,048 | 13,250 |
Cost or amortized cost | $ 9,048 | $ 13,250 |
Investments, Securities with Co
Investments, Securities with Continuous Unrealized Loss Position (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | ||
Less than 12 months | $ 53,282 | $ 91,645 |
12 months or longer | 45,404 | 20,587 |
Total Fair Value | 98,686 | 112,232 |
Available-for-sale securities, continuous unrealized loss position, Unrealized Losses [Abstract] | ||
Less than 12 months | 816 | 2,985 |
12 months or longer | 3,105 | 2,556 |
Total Unrealized Losses | 3,921 | 5,541 |
Fixed Maturities - U.S. Treasury Securities and Obligations of U.S. Government Agencies and Authorities [Member] | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | ||
Less than 12 months | 12,175 | 23,494 |
12 months or longer | 12,737 | 0 |
Total Fair Value | 24,912 | 23,494 |
Available-for-sale securities, continuous unrealized loss position, Unrealized Losses [Abstract] | ||
Less than 12 months | 162 | 553 |
12 months or longer | 349 | 0 |
Total Unrealized Losses | 511 | 553 |
Fixed Maturities - Obligations of States and Political Subdivisions [Member] | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | ||
Less than 12 months | 999 | 8,747 |
12 months or longer | 0 | 0 |
Total Fair Value | 999 | 8,747 |
Available-for-sale securities, continuous unrealized loss position, Unrealized Losses [Abstract] | ||
Less than 12 months | 1 | 308 |
12 months or longer | 0 | 0 |
Total Unrealized Losses | 1 | 308 |
Fixed Maturities - Corporate Securities [Member] | ||
Available-for-sale securities, continuous unrealized loss position, Fair Value [Abstract] | ||
Less than 12 months | 40,108 | 59,404 |
12 months or longer | 32,667 | 20,587 |
Total Fair Value | 72,775 | 79,991 |
Available-for-sale securities, continuous unrealized loss position, Unrealized Losses [Abstract] | ||
Less than 12 months | 653 | 2,124 |
12 months or longer | 2,756 | 2,556 |
Total Unrealized Losses | $ 3,409 | $ 4,680 |
Investments, Fair Value Measure
Investments, Fair Value Measured on a Recurring Basis (Details) - Recurring [Member] - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Financial instruments carried at fair value measured on a recurring basis [Abstract] | |||
Assets at fair value | $ 252,318 | $ 240,738 | |
Fixed Maturities [Member] | |||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | |||
Assets at fair value | 215,108 | 210,670 | |
Equity Securities [Member] | |||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | |||
Assets at fair value | 23,355 | 20,257 | |
Cash Equivalents [Member] | |||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | |||
Assets at fair value | 13,855 | 9,811 | |
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 | 31,828 | 24,964 | |
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 | 17,973 | 15,153 | |
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 | 13,855 | 9,811 | |
Significant Other Observable Inputs (Level 2) [Member] | |||
Financial instruments carried at fair value measured on a recurring basis [Abstract] | |||
Assets at fair value | 219,121 | 214,510 | |
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 | 213,739 | 209,406 | |
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 | [1] | 5,382 | 5,104 |
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 | 1,369 | 1,264 | |
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 | [1] | 1,369 | 1,264 |
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 | |
[1] | All underlying securities are financial service industry related. |
Investments, Roll-forward of Fi
Investments, Roll-forward of Financial Instruments Measured at Fair Value (Details) - Fixed Maturities [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Assets measured at fair value on a recurring basis [Abstract] | ||
Balance, beginning of period | $ 1,264 | $ 2,237 |
Total realized gains included in earnings | 57 | |
Total unrealized losses included in other comprehensive income | 105 | (30) |
Settlements | (1,000) | |
Balance, end of period | $ 1,369 | $ 1,264 |
Investments, Fixed Maturities b
Investments, Fixed Maturities by Contractual Maturities (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 |
Carrying Value [Abstract] | ||
Due in one year or less | $ 1,653 | $ 2,544 |
Due after one year through five years | 13,738 | 20,278 |
Due after five years through ten years | 112,847 | 90,667 |
Due after ten years | 67,328 | 80,099 |
Varying maturities | 19,542 | 17,082 |
Totals | 215,108 | 210,670 |
Amortized Cost [Abstract] | ||
Due in one year or less | 1,655 | 2,507 |
Due after one year through five years | 14,056 | 20,038 |
Due after five years through ten years | 112,116 | 90,926 |
Due after ten years | 64,928 | 79,627 |
Varying maturities | 19,789 | 17,407 |
Cost or amortized cost | $ 212,544 | $ 210,505 |
Investments, Income Earned (Det
Investments, Income Earned (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Investment income earned [Abstract] | ||
Total investment income | $ 8,496 | $ 9,884 |
Less investment expenses, included in other expenses | (789) | (577) |
Net investment income | 7,707 | 9,307 |
Fixed Maturities [Member] | ||
Investment income earned [Abstract] | ||
Total investment income | 8,297 | 9,122 |
Equity Securities [Member] | ||
Investment income earned [Abstract] | ||
Total investment income | 467 | 491 |
Other Investments [Member] | ||
Investment income earned [Abstract] | ||
Total investment income | $ (268) | $ 271 |
Investments, Summary of Realize
Investments, Summary of Realized Investment Gains (Losses) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Summary of realized investment gains (losses) [Abstract] | ||
Gains | $ 9,310 | $ 2,684 |
Losses | (142) | (89) |
Realized investment gains, net | 9,168 | 2,595 |
Proceeds from sales of investments [Abstract] | ||
Total proceeds | $ 83,992 | 62,361 |
Percentage of investment grade securities in bond portfolio | 92.00% | |
Fixed Maturities [Member] | ||
Summary of realized investment gains (losses) [Abstract] | ||
Gains | $ 2,226 | 1,119 |
Losses | (142) | (89) |
Realized investment gains, net | 2,084 | 1,030 |
Proceeds from sales of investments [Abstract] | ||
Total proceeds | 72,760 | 59,072 |
Equity Securities [Member] | ||
Summary of realized investment gains (losses) [Abstract] | ||
Gains | 1,044 | 0 |
Losses | 0 | 0 |
Realized investment gains, net | 1,044 | 0 |
Proceeds from sales of investments [Abstract] | ||
Total proceeds | 1,579 | 0 |
Other Investments [Member] | ||
Summary of realized investment gains (losses) [Abstract] | ||
Gains | 6,040 | 1,565 |
Losses | 0 | 0 |
Realized investment gains, net | 6,040 | 1,565 |
Proceeds from sales of investments [Abstract] | ||
Total proceeds | $ 9,653 | $ 3,289 |
Insurance Reserves and Policy49
Insurance Reserves and Policyholder Funds (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | $ 82,435 | $ 74,843 | ||
Amount of Insurance In Force, Net | 240,604 | 247,480 | ||
Unearned premiums | 23,449 | 23,208 | ||
Losses, claims and loss adjustment expenses | $ 65,689 | $ 62,562 | 65,689 | 62,562 |
Other policy liabilities | 2,010 | 2,066 | ||
Total insurance reserves and policyholder funds | 173,583 | 162,679 | ||
Annualized premiums for accident and health insurance policies | 105,422 | 95,956 | ||
Summary of activity in liability for unpaid loss and claim reserves [Roll Forward] | ||||
Balance at January 1 | 62,562 | 63,870 | ||
Less: Reinsurance recoverable on unpaid losses | (10,796) | (11,741) | ||
Net balance at January 1 | 51,766 | 52,129 | ||
Incurred related to [Abstract] | ||||
Current year | 114,099 | 103,252 | ||
Prior years | (1,765) | (3,377) | ||
Total incurred | 112,334 | 99,875 | ||
Paid related to [Abstract] | ||||
Current year | 82,092 | 71,980 | ||
Prior years | 28,287 | 28,258 | ||
Total paid | 110,379 | 100,238 | ||
Net balance at December 31 | 53,721 | 51,766 | ||
Plus: Reinsurance recoverable on unpaid losses | 11,968 | 10,796 | ||
Balance at December 31 | 65,689 | 62,562 | ||
Reconciliation of total incurred claims to total insurance benefits and losses incurred [Abstract] | ||||
Total incurred losses | 112,334 | 99,875 | ||
Cash surrender value and matured endowments | 1,442 | 1,278 | ||
Benefit reserve changes | 3,739 | 2,044 | ||
Total insurance benefits and losses incurred | $ 117,515 | $ 103,197 | ||
Ordinary [Member] | ||||
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | 54,752 | 54,554 | ||
Amount of Insurance In Force, Net | 238,534 | 245,017 | ||
Mass market [Member] | ||||
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | 1,693 | 2,003 | ||
Amount of Insurance In Force, Net | 2,070 | 2,463 | ||
Individual annuities [Member] | ||||
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | 50 | 84 | ||
Amount of Insurance In Force, Net | 0 | 0 | ||
Life insurance segment [Member] | ||||
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | 56,495 | 56,641 | ||
Amount of Insurance In Force, Net | 240,604 | 247,480 | ||
Accident and health insurance [Member] | ||||
Reserves for life, accident and health [Abstract] | ||||
Future policy benefits | $ 25,940 | $ 18,202 | ||
Life, accident and health insurance [Member] | Prior to 1977 [Member] | ||||
Future policy benefits [Abstract] | ||||
Policy issue range for future benefits assumptions | prior to 1977 | |||
Life, accident and health insurance [Member] | Prior to 1977 [Member] | Minimum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 2.50% | |||
Life, accident and health insurance [Member] | Prior to 1977 [Member] | Maximum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 5.50% | |||
Life, accident and health insurance [Member] | 1977 through 1979 [Member] | ||||
Future policy benefits [Abstract] | ||||
Policy issue range for future benefits assumptions | 1977 through 1979 | |||
Life, accident and health insurance [Member] | 1977 through 1979 [Member] | Minimum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 5.50% | |||
Life, accident and health insurance [Member] | 1977 through 1979 [Member] | Maximum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 7.00% | |||
Life, accident and health insurance [Member] | 1980 through 1987 [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 9.00% | |||
Policy issue range for future benefits assumptions | 1980 through 1987 | |||
Life, accident and health insurance [Member] | 1988 through 2009 [Member] | ||||
Future policy benefits [Abstract] | ||||
Policy issue range for future benefits assumptions | 1988 through 2009 | |||
Life, accident and health insurance [Member] | 1988 through 2009 [Member] | Minimum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 5.00% | |||
Life, accident and health insurance [Member] | 1988 through 2009 [Member] | Maximum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 7.00% | |||
Life, accident and health insurance [Member] | 2010 through 2012 [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 4.00% | |||
Policy issue range for future benefits assumptions | 2010 through 2012 issues | |||
Life, accident and health insurance [Member] | 2013 through 2017 [Member] | ||||
Future policy benefits [Abstract] | ||||
Policy issue range for future benefits assumptions | 2013 through 2017 issues | |||
Life, accident and health insurance [Member] | 2013 through 2017 [Member] | Minimum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 3.50% | |||
Life, accident and health insurance [Member] | 2013 through 2017 [Member] | Maximum [Member] | ||||
Future policy benefits [Abstract] | ||||
Interest rates assumed for future policy benefits | 4.00% |
Insurance Reserves and Policy50
Insurance Reserves and Policyholder Funds, Liability for Unpaid Losses, Claims and Loss Adjustment Expenses (Details) $ in Thousands | 12 Months Ended | |||||||||
Dec. 31, 2017USD ($)Claim | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Dec. 31, 2012USD ($) | Dec. 31, 2011USD ($) | Dec. 31, 2010USD ($) | Dec. 31, 2009USD ($) | Dec. 31, 2008USD ($) | |
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | $ 51,995 | |||||||||
Duration required for loss data to develop the estimated ultimate incurred claims | 36 months | |||||||||
Minimum [Member] | ||||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Property and casualty claim threshold amount required for review | $ 25,000 | |||||||||
Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 479,469 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | 469,101 | |||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 10,368 | |||||||||
Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 158,363 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | 126,913 | |||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 31,450 | |||||||||
Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 33,691 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | 32,614 | |||||||||
All outstanding liabilities prior period net of reinsurance | 33 | |||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 1,110 | |||||||||
General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 15,080 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | 11,466 | |||||||||
All outstanding liabilities prior period net of reinsurance | 288 | |||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 3,902 | |||||||||
Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 34,032 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | 30,871 | |||||||||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 3,161 | |||||||||
Accident Year 2008 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 28,682 | $ 28,682 | $ 28,683 | $ 28,683 | $ 28,687 | $ 28,688 | $ 28,712 | $ 28,721 | $ 28,698 | $ 29,344 |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 533,112 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 28,682 | 28,682 | 28,683 | 28,683 | 28,687 | 28,688 | 28,712 | 28,721 | 28,698 | 24,055 |
Accident Year 2008 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 6,105 | 6,105 | 6,104 | 6,106 | 6,112 | 6,124 | 6,374 | 6,627 | 7,011 | 9,723 |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,534 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 6,105 | 6,105 | 6,104 | 6,104 | 6,065 | 5,839 | 5,695 | 5,077 | 4,202 | 2,426 |
Accident Year 2008 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 2,853 | 2,647 | 2,548 | 2,507 | 2,489 | 2,479 | 2,685 | 2,858 | 4,359 | 5,386 |
IBNR Reserves | $ 23 | |||||||||
Cumulative number of reported claims | Claim | 393 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 2,755 | 2,564 | 2,506 | 2,418 | 2,123 | 2,023 | 1,861 | 1,637 | 1,091 | 534 |
Accident Year 2008 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 2,324 | 2,324 | 2,324 | 2,360 | 2,360 | 2,312 | 2,312 | 2,420 | 2,098 | 3,883 |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 62 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 2,324 | 2,324 | 2,324 | 2,360 | 2,359 | 2,311 | 2,232 | 2,261 | 1,369 | $ 503 |
Accident Year 2009 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 30,430 | 30,430 | 30,431 | 30,432 | 30,438 | 30,447 | 30,481 | 30,455 | 31,124 | |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 560,430 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 30,430 | 30,430 | 30,431 | 30,432 | 30,438 | 30,447 | 30,481 | 30,455 | 29,866 | |
Accident Year 2009 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 8,153 | 8,154 | 8,155 | 8,123 | 8,245 | 8,558 | 8,659 | 8,891 | 10,817 | |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,755 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 8,153 | 8,154 | 8,155 | 8,123 | 7,995 | 7,502 | 6,353 | 5,208 | 3,250 | |
Accident Year 2009 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,888 | 1,832 | 1,828 | 1,727 | 1,702 | 1,730 | 1,944 | 2,215 | 3,392 | |
IBNR Reserves | $ 8 | |||||||||
Cumulative number of reported claims | Claim | 290 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,855 | 1,816 | 1,796 | 1,662 | 1,629 | 1,410 | 1,082 | 941 | 476 | |
Accident Year 2009 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 4,667 | 4,664 | 4,916 | 4,636 | 3,616 | 3,951 | 4,239 | 5,025 | 4,920 | |
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 83 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 4,666 | 4,663 | 3,757 | 3,760 | 3,410 | 3,205 | 2,640 | 1,595 | $ 103 | |
Accident Year 2010 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 34,265 | 34,268 | 34,272 | 34,282 | 34,303 | 34,323 | 34,328 | 34,849 | ||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 625,695 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 34,265 | 34,268 | 34,272 | 34,282 | 34,303 | 34,323 | 34,328 | 29,127 | ||
Accident Year 2010 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 10,201 | 10,202 | 10,185 | 10,068 | 9,937 | 10,547 | 10,818 | 10,752 | ||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,947 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 10,206 | 10,090 | 10,056 | 9,725 | 9,382 | 8,291 | 6,274 | 3,211 | ||
Accident Year 2010 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 2,473 | 2,423 | 2,400 | 2,258 | 2,337 | 2,269 | 2,699 | 4,114 | ||
IBNR Reserves | $ 4 | |||||||||
Cumulative number of reported claims | Claim | 289 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 2,457 | 2,382 | 2,368 | 2,037 | 1,542 | 1,374 | 678 | 284 | ||
Accident Year 2010 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 3,534 | 3,563 | 3,549 | 3,607 | 3,396 | 3,618 | 4,624 | 3,995 | ||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 95 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 3,534 | 3,560 | 3,545 | 3,252 | 2,943 | 2,780 | 2,193 | $ 928 | ||
Accident Year 2011 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 38,299 | 38,302 | 38,316 | 38,327 | 38,360 | 38,296 | 38,188 | |||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 664,049 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 38,299 | 38,302 | 38,316 | 38,327 | 38,360 | 38,296 | 31,720 | |||
Accident Year 2011 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 13,385 | 13,495 | 13,281 | 13,289 | 13,235 | 13,802 | 12,263 | |||
IBNR Reserves | $ 30 | |||||||||
Cumulative number of reported claims | Claim | 2,132 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 13,199 | 13,106 | 13,039 | 12,071 | 9,858 | 7,934 | 4,205 | |||
Accident Year 2011 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,327 | 1,242 | 1,174 | 1,338 | 1,452 | 1,723 | 3,022 | |||
IBNR Reserves | $ 11 | |||||||||
Cumulative number of reported claims | Claim | 201 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,278 | 1,169 | 1,161 | 835 | 582 | 412 | 295 | |||
Accident Year 2011 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 5,112 | 5,031 | 4,966 | 5,092 | 5,080 | 4,786 | 4,422 | |||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 126 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 5,109 | 5,022 | 4,939 | 4,748 | 4,622 | 3,207 | $ 1,031 | |||
Accident Year 2012 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 50,987 | 50,989 | 50,998 | 51,021 | 50,996 | 50,021 | ||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 867,047 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 50,987 | 50,989 | 50,998 | 51,021 | 50,996 | 42,267 | ||||
Accident Year 2012 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 13,343 | 13,313 | 13,707 | 14,108 | 15,007 | 12,980 | ||||
IBNR Reserves | $ 22 | |||||||||
Cumulative number of reported claims | Claim | 3,340 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 13,211 | 13,197 | 12,932 | 11,507 | 8,791 | 4,627 | ||||
Accident Year 2012 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,333 | 1,214 | 1,270 | 1,269 | 1,305 | 4,055 | ||||
IBNR Reserves | $ 26 | |||||||||
Cumulative number of reported claims | Claim | 157 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,219 | 1,113 | 1,034 | 847 | 707 | 371 | ||||
Accident Year 2012 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 4,880 | 4,869 | 5,345 | 5,396 | 4,767 | 4,979 | ||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 87 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 4,880 | 4,869 | 5,331 | 4,856 | 4,581 | $ 2,257 | ||||
Accident Year 2013 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 57,021 | 57,023 | 57,034 | 56,970 | 56,974 | |||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 957,350 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 57,021 | 57,023 | 57,034 | 56,970 | 47,770 | |||||
Accident Year 2013 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 21,352 | 21,823 | 21,096 | 20,702 | 18,664 | |||||
IBNR Reserves | $ 162 | |||||||||
Cumulative number of reported claims | Claim | 3,260 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 20,382 | 19,407 | 16,782 | 12,193 | 5,144 | |||||
Accident Year 2013 [Member] | Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 5,599 | 5,599 | 5,536 | 5,515 | 6,039 | |||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,598 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 5,599 | 5,599 | 5,466 | 5,486 | 4,778 | |||||
Accident Year 2013 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 865 | 817 | 926 | 728 | 3,461 | |||||
IBNR Reserves | $ 18 | |||||||||
Cumulative number of reported claims | Claim | 187 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 791 | 811 | 579 | 339 | 104 | |||||
Accident Year 2013 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 2,866 | 2,947 | 2,743 | 2,007 | 3,060 | |||||
IBNR Reserves | $ 13 | |||||||||
Cumulative number of reported claims | Claim | 57 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 2,789 | 2,763 | 1,369 | 1,010 | $ 323 | |||||
Accident Year 2014 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 56,981 | 56,981 | 56,938 | 57,179 | ||||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 939,444 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 56,981 | 56,981 | 56,938 | 48,024 | ||||||
Accident Year 2014 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 22,353 | 22,041 | 21,881 | 20,812 | ||||||
IBNR Reserves | $ 816 | |||||||||
Cumulative number of reported claims | Claim | 3,536 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 20,177 | 17,554 | 13,807 | 6,822 | ||||||
Accident Year 2014 [Member] | Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 7,562 | 7,583 | 7,657 | 8,079 | ||||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,635 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 7,562 | 7,570 | 7,619 | 6,437 | ||||||
Accident Year 2014 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 476 | 557 | 501 | 3,744 | ||||||
IBNR Reserves | $ 40 | |||||||||
Cumulative number of reported claims | Claim | 192 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 369 | 331 | 299 | 171 | ||||||
Accident Year 2014 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 2,760 | 2,990 | 3,130 | 3,214 | ||||||
IBNR Reserves | $ 4 | |||||||||
Cumulative number of reported claims | Claim | 51 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 2,739 | 2,727 | 2,327 | $ 1,331 | ||||||
Accident Year 2015 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 54,993 | 54,939 | 55,482 | |||||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 898,270 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 54,993 | 54,876 | 45,430 | |||||||
Accident Year 2015 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 20,017 | 19,857 | 18,521 | |||||||
IBNR Reserves | $ 1,904 | |||||||||
Cumulative number of reported claims | Claim | 3,492 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 14,938 | 11,878 | 6,226 | |||||||
Accident Year 2015 [Member] | Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 7,887 | 7,955 | 8,287 | |||||||
IBNR Reserves | $ 0 | |||||||||
Cumulative number of reported claims | Claim | 1,588 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 7,885 | 7,937 | 6,745 | |||||||
Accident Year 2015 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,227 | 1,037 | 4,421 | |||||||
IBNR Reserves | $ 348 | |||||||||
Cumulative number of reported claims | Claim | 143 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 464 | 259 | 98 | |||||||
Accident Year 2015 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,400 | 1,630 | 1,902 | |||||||
IBNR Reserves | $ 78 | |||||||||
Cumulative number of reported claims | Claim | 49 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,127 | 856 | $ 641 | |||||||
Accident Year 2016 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 59,851 | 58,849 | ||||||||
IBNR Reserves | $ 100 | |||||||||
Cumulative number of reported claims | Claim | 1,034,900 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 59,747 | 49,165 | ||||||||
Accident Year 2016 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 21,275 | 20,549 | ||||||||
IBNR Reserves | $ 3,049 | |||||||||
Cumulative number of reported claims | Claim | 3,755 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 13,141 | 6,796 | ||||||||
Accident Year 2016 [Member] | Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 6,386 | 6,877 | ||||||||
IBNR Reserves | $ 3 | |||||||||
Cumulative number of reported claims | Claim | 1,261 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 6,353 | 5,804 | ||||||||
Accident Year 2016 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,148 | 3,119 | ||||||||
IBNR Reserves | $ 440 | |||||||||
Cumulative number of reported claims | Claim | 81 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 203 | 116 | ||||||||
Accident Year 2016 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,812 | 3,314 | ||||||||
IBNR Reserves | $ 39 | |||||||||
Cumulative number of reported claims | Claim | 45 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,732 | $ 1,054 | ||||||||
Accident Year 2017 [Member] | Medicare Supplement Insurance [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 67,960 | |||||||||
IBNR Reserves | $ 9,822 | |||||||||
Cumulative number of reported claims | Claim | 1,303,865 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 57,696 | |||||||||
Accident Year 2017 [Member] | Automobile Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 22,179 | |||||||||
IBNR Reserves | $ 7,311 | |||||||||
Cumulative number of reported claims | Claim | 3,385 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 7,401 | |||||||||
Accident Year 2017 [Member] | Automobile Physical Damage [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 6,257 | |||||||||
IBNR Reserves | $ 105 | |||||||||
Cumulative number of reported claims | Claim | 1,238 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 5,215 | |||||||||
Accident Year 2017 [Member] | General Liability [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 1,490 | |||||||||
IBNR Reserves | $ 1,241 | |||||||||
Cumulative number of reported claims | Claim | 58 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 75 | |||||||||
Accident Year 2017 [Member] | Surety [Member] | ||||||||||
Incurred Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Incurred claims and allocated claim adjustment expenses, net of reinsurance | 4,677 | |||||||||
IBNR Reserves | $ 2,043 | |||||||||
Cumulative number of reported claims | Claim | 52 | |||||||||
Cumulative Paid Claims Development, Net of Reinsurance [Abstract] | ||||||||||
Cumulative paid claims and allocated claim adjustment expense, net of reinsurance. | $ 1,971 |
Insurance Reserves and Policy51
Insurance Reserves and Policyholder Funds, Average Historical Claims Duration (Details) | Dec. 31, 2017 |
Medicare Supplement Insurance [Member] | |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited) [Abstract] | |
1st Year | 83.70% |
2nd Year | 16.40% |
3rd Year | 0.10% |
4th Year | (0.10%) |
5th Year | 0.00% |
6th Year | 0.00% |
7th Year | 0.00% |
8th Year | 0.00% |
9th Year | 0.00% |
10th Year | 0.00% |
Automobile Liability [Member] | |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited) [Abstract] | |
1st Year | 32.80% |
2nd Year | 29.40% |
3rd Year | 17.10% |
4th Year | 12.30% |
5th Year | 4.30% |
6th Year | 1.80% |
7th Year | 0.50% |
8th Year | 0.40% |
9th Year | 0.00% |
10th Year | 0.00% |
Automobile Physical Damage [Member] | |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited) [Abstract] | |
1st Year | 86.00% |
2nd Year | 13.00% |
3rd Year | (0.60%) |
4th Year | 1.10% |
5th Year | 0.00% |
General Liability [Member] | |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited) [Abstract] | |
1st Year | 17.70% |
2nd Year | 18.80% |
3rd Year | 16.20% |
4th Year | 14.30% |
5th Year | 10.90% |
6th Year | 5.40% |
7th Year | 6.60% |
8th Year | 2.40% |
9th Year | 2.00% |
10th Year | 6.70% |
Surety [Member] | |
Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance (unaudited) [Abstract] | |
1st Year | 32.20% |
2nd Year | 34.20% |
3rd Year | 19.60% |
4th Year | 11.00% |
5th Year | 2.00% |
6th Year | 3.90% |
7th Year | 0.50% |
8th Year | 5.70% |
9th Year | 0.00% |
10th Year | 0.00% |
Insurance Reserves and Policy52
Insurance Reserves and Policyholder Funds, Incurred Paid Claims Reconciliation (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 |
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | $ 51,995 | ||
Reinsurance Recoverable on Unpaid Claims [Abstract] | |||
Total reinsurance recoverable on unpaid losses | 11,968 | $ 10,796 | |
Unallocated claims adjustment expenses | 1,726 | ||
Total gross liability for unpaid losses, claims and loss adjustment expenses | 65,689 | $ 62,562 | $ 63,870 |
Medicare Supplement Insurance [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 10,368 | ||
Reinsurance Recoverable on Unpaid Claims [Abstract] | |||
Total reinsurance recoverable on unpaid losses | 4,748 | ||
Automobile Liability [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 31,450 | ||
Reinsurance Recoverable on Unpaid Claims [Abstract] | |||
Total reinsurance recoverable on unpaid losses | 5,245 | ||
Automobile Physical Damage [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 1,110 | ||
Reinsurance Recoverable on Unpaid Claims [Abstract] | |||
Total reinsurance recoverable on unpaid losses | 116 | ||
General Liability [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 3,902 | ||
Reinsurance Recoverable on Unpaid Claims [Abstract] | |||
Total reinsurance recoverable on unpaid losses | 1,859 | ||
Surety [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | 3,161 | ||
Other Short-Duration Insurance Lines [Member] | |||
Net Outstanding Liabilities [Abstract] | |||
Liabilities for unpaid claims and claim adjustment expenses, net of reinsurance | $ 2,004 |
Reinsurance (Details)
Reinsurance (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)Reinsurer | Dec. 31, 2016USD ($) | |
Ceded Credit Risk [Line Items] | ||
Percentage of reinsurance recoverables due from reinsurers | 99.00% | |
Number of reinsurers | Reinsurer | 2 | |
Summary reconciliation of premiums written and premiums earned [Abstract] | ||
Direct premiums written | $ 181,568 | $ 142,200 |
Assumed premiums written | 19,373 | 19,123 |
Ceded premiums written | (38,019) | (10,225) |
Net premiums written | 162,922 | 151,098 |
Direct premiums earned | 181,458 | 144,339 |
Assumed premiums earned | 19,241 | 19,124 |
Ceded premiums earned | (37,372) | (9,998) |
Net premiums earned | 163,327 | 153,465 |
Provision for benefits and losses incurred | 147,444 | 109,616 |
Reinsurance loss recoveries | (29,929) | (6,419) |
Total insurance benefits and losses incurred | 117,515 | 103,197 |
Components of reinsurance recoverables [Abstract] | ||
Recoverable on unpaid losses | 11,968 | 10,796 |
Recoverable on unpaid benefits | 4,403 | 655 |
Ceded unearned premiums | 874 | 227 |
Ceded advanced premiums | 368 | 25 |
Total reinsurance recoverables | 17,613 | $ 11,703 |
Swiss Reinsurance Corporation [Member] | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverables due | 60 | |
General Re Life Corporation [Member] | ||
Ceded Credit Risk [Line Items] | ||
Reinsurance recoverables due | $ 17,449 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Allocation of total income taxes [Abstract] | |||
Total tax expense on income | $ 828 | $ 888 | |
Tax expense on components of shareholders' equity [Abstract] | |||
Net unrealized gains on investment securities | 2,111 | 671 | |
Total tax expense | 2,939 | 1,559 | |
Reconciliation of income tax expense (benefit) [Abstract] | |||
Federal income tax provision at statutory rate of 35% | 1,875 | 1,233 | |
Dividends-received deduction | (92) | (95) | |
Small life insurance company deduction | (613) | (376) | |
Other | 72 | 55 | |
Remeasurement of deferred taxes due to tax reform enactment | (395) | 0 | |
Adjustment for prior years' estimates to actual | (19) | 71 | |
Income tax expense | $ 828 | $ 888 | |
Effective tax rate | 15.50% | 25.20% | |
Federal statutory income tax rate | 35.00% | ||
SLD as percentage of life insurance company taxable income | 60.00% | ||
Percentage of reduction in SLD | 15.00% | ||
Tentative amount of LICTI to reduction of SLD | $ 3,000 | ||
Tentative amount of LICTI to phase out of SLD | 15,000 | ||
Deferred tax liabilities [Abstract] | |||
Deferred acquisition costs | (1,200) | $ (2,345) | |
Deferred and uncollected premiums | (377) | (654) | |
Net unrealized investment gains | (3,150) | (3,140) | |
Other | (331) | (666) | |
Total deferred tax liabilities | (5,058) | (6,805) | |
Deferred tax assets [Abstract] | |||
Insurance reserves | 3,216 | 4,589 | |
Impaired assets | 869 | 1,454 | |
Alternative minimum tax credit | 0 | 282 | |
Bad debts and other | 380 | 640 | |
Total deferred tax assets | 4,465 | 6,965 | |
Net deferred tax liability | (593) | 0 | |
Net deferred tax asset | 0 | 160 | |
Components of income tax expense [Abstract] | |||
Current - Federal | 2,186 | 890 | |
Deferred - Federal | (1,358) | (2) | |
Income tax expense | $ 828 | $ 888 | |
Plan [Member] | |||
Reconciliation of income tax expense (benefit) [Abstract] | |||
Federal statutory income tax rate | 21.00% |
Junior Subordinated Debenture55
Junior Subordinated Debentures (Details) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)TrustQuarter$ / sharesshares | ||
Debt Instrument [Line Items] | ||
Number of Connecticut statutory business trusts | Trust | 2 | |
Financial structure of statutory business trusts [Abstract] | ||
Net balance December 31, 2017 | $ 33,738 | |
Net balance December 31, 2016 | $ 33,738 | |
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 | $ 18,042 | [1],[2] |
Balance December 31, 2017 | 18,042 | [1],[2] |
Less: Treasury debt | 0 | [1],[2],[3] |
Net balance December 31, 2017 | 18,042 | [1],[2] |
Net balance December 31, 2016 | $ 18,042 | [1],[2] |
Coupon rate | LIBOR + 4.00% | [1],[2] |
Interest payable | Quarterly | [1],[2] |
Maturity date | Dec. 4, 2032 | [1],[2] |
Redeemable by issuer | Yes | [1],[2] |
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 | Atlantic American Corporation | [4] |
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 | $ 23,196 | [1],[2] |
Balance December 31, 2017 | 23,196 | [1],[2] |
Less: Treasury debt | (7,500) | [1],[2],[3] |
Net balance December 31, 2017 | 15,696 | [1],[2] |
Net balance December 31, 2016 | $ 15,696 | [1],[2] |
Coupon rate | LIBOR + 4.10% | [1],[2] |
Interest payable | Quarterly | [1],[2] |
Maturity date | May 15, 2033 | [1],[2] |
Redeemable by issuer | Yes | [1],[2] |
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 | Atlantic American Corporation | [4] |
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] | In 2014, the Company acquired $7,500 of the Junior Subordinated Debentures. | |
[4] | The Parent has guaranteed, on a subordinated basis, all of the obligations under the Trust Preferred Securities, including payment of the redemption price and any accumulated and unpaid distributions to the extent of available funds and upon dissolution, winding up or liquidation. |
Commitments and Contingencies56
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Commitments and Contingencies [Abstract] | ||
Rental expense for operating leases | $ 1,306 | $ 1,277 |
Future minimum base lease obligations under non-cancelable operating leases [Abstract] | ||
2,018 | 928 | |
2,019 | 495 | |
2,020 | 528 | |
Thereafter | 3,785 | |
Total | $ 5,736 |
Benefit Plans (Details)
Benefit Plans (Details) - 2012 Plan [Member] - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Share Awards [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Number of shares authorized for issuance (in shares) | 2,000,000 | |
Shares available for future grant (in shares) | 1,241,200 | 1,423,200 |
Stock Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options granted (in shares) | 0 | 0 |
Options outstanding (in shares) | 0 | 0 |
Restricted Stock [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Restricted shares issued (in shares) | 182,000 | 180,000 |
Estimated fair value of shares issued | $ 646 | $ 741 |
Restricted Stock [Member] | Minimum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 1 year | |
Restricted Stock [Member] | Maximum [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Vesting period | 3 years |
Benefit Plans, 401(k) Plans (De
Benefit Plans, 401(k) Plans (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
401(k) Plan [Abstract] | ||
Maximum percentage of compensation employees may defer | 50.00% | |
Total matching contribution | $ 237 | $ 223 |
Employer maximum contribution to plan | 35.00% | 35.00% |
Percentage of participants contribution | 6.00% | 6.00% |
Safe harbor non-elective contribution | 3.00% | 3.00% |
Safe harbor non-elective contribution | $ 450 | $ 433 |
Preferred Stock (Details)
Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Class of Stock [Line Items] | ||
Series D Preferred Stock, outstanding (in shares) | 55,000 | 55,000 |
Dividends paid for Series D Preferred Stock | $ 399 | $ 399 |
Series D Preferred Stock [Member] | ||
Class of Stock [Line Items] | ||
Series D Preferred Stock, outstanding (in shares) | 55,000 | 55,000 |
Preferred stock, par value (in dollars per share) | $ 100 | $ 100 |
Accrued annual dividends rate (in dollars per share) | $ 7.25 | $ 7.25 |
Number of preferred stock shares convertible to common shares (in shares) | 1,378,000 | |
Maximum number of common stock issuable from conversion of preference shares, without obtaining prior shareholder approval (in shares) | 2,703,000 | |
Dividends accrued but unpaid | $ 18 | $ 18 |
Dividends paid for Series D Preferred Stock | $ 399 | $ 399 |
Earnings Per Common Share (Deta
Earnings Per Common Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Income [Abstract] | ||
Net income before preferred stock dividends | $ 4,528 | $ 2,636 |
Less: preferred stock dividends | (399) | (399) |
Net income applicable to common shareholders | $ 4,129 | $ 2,237 |
Shares [Abstract] | ||
Weighted average shares outstanding (in shares) | 20,431 | 20,445 |
Per Share Amount [Abstract] | ||
Net income applicable to common shareholders (in dollars per share) | $ 0.20 | $ 0.11 |
Statutory Reporting (Details)
Statutory Reporting (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Statutory Accounting Practices [Line Items] | ||
Dividends received from its subsidiaries | $ 4,850 | $ 5,508 |
Maximum dividend payments by insurance subsidiaries without requiring prior approval | 4,761 | |
Statutory accounting practices [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory net income (loss) | 3,767 | 7,603 |
Statutory surplus | 77,483 | 74,919 |
Statutory accounting practices [Member] | Life and Health [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory net income (loss) | (2,880) | 1,133 |
Statutory surplus | 34,135 | 33,430 |
Statutory accounting practices [Member] | Property and Casualty [Member] | ||
Statutory Accounting Practices [Line Items] | ||
Statutory net income (loss) | 6,647 | 6,470 |
Statutory surplus | $ 43,348 | $ 41,489 |
Related Party Transactions (Det
Related Party Transactions (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017USD ($)ft²Directorshares | Dec. 31, 2016USD ($)shares | |
Related Party Transaction [Line Items] | ||
Number of board of directors | Director | 2 | |
Rental expense for operating leases | $ 1,306 | $ 1,277 |
Payment of dividends on Series D Preferred Stock | 399 | 399 |
Series D Preferred Stock [Member] | ||
Related Party Transaction [Line Items] | ||
Payment of dividends on Series D Preferred Stock | $ 399 | 399 |
Affiliated Entity [Member] | ||
Related Party Transaction [Line Items] | ||
Office and covered garage space leased | ft² | 49,586 | |
Rental expense for operating leases | $ 866 | 882 |
Services purchased from related party | 54 | 215 |
Members of Management [Member] | ||
Related Party Transaction [Line Items] | ||
Aggregate carrying value of investments in Gray | 14,407 | 10,305 |
Premiums paid by Gray for group accident plan | $ 597 | $ 478 |
Members of Management [Member] | Class A common stock [Member] | ||
Related Party Transaction [Line Items] | ||
Shares of Gray common stock owned (in shares) | shares | 880,272 | 880,272 |
Members of Management [Member] | Common Stock [Member] | ||
Related Party Transaction [Line Items] | ||
Shares of Gray common stock owned (in shares) | shares | 106,000 | 106,000 |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Revenue and income (loss) before income taxes for each business unit [Abstract] | ||
Insurance premiums | $ 163,327 | $ 153,465 |
Insurance benefits and losses incurred | 117,515 | 103,197 |
Expenses deferred | (14,349) | (12,993) |
Amortization and depreciation expense | 12,080 | 13,089 |
Other expenses | 60,512 | 59,260 |
Total benefits and expenses | 175,758 | 162,553 |
Investment income | 8,496 | 9,884 |
Other income | 123 | 133 |
Operating income (loss) | (3,812) | 929 |
Net realized gains (losses) | 9,168 | 2,595 |
Income before income taxes | 5,356 | 3,524 |
Total revenues | 181,114 | 166,077 |
Intangibles | 2,544 | 2,544 |
Total assets | 343,239 | 318,600 |
Operating Segments [Member] | American Southern [Member] | ||
Revenue and income (loss) before income taxes for each business unit [Abstract] | ||
Insurance premiums | 53,661 | 53,763 |
Insurance benefits and losses incurred | 34,486 | 34,408 |
Expenses deferred | (8,062) | (7,834) |
Amortization and depreciation expense | 8,543 | 8,709 |
Other expenses | 15,951 | 15,562 |
Total benefits and expenses | 50,918 | 50,845 |
Underwriting income (loss) | 2,743 | 2,918 |
Investment income | 3,332 | 3,868 |
Other income | 11 | 0 |
Operating income (loss) | 6,086 | 6,786 |
Net realized gains (losses) | 2,481 | 528 |
Income before income taxes | 8,567 | 7,314 |
Total revenues | 59,485 | 58,159 |
Intangibles | 1,350 | 1,350 |
Total assets | 126,313 | 123,721 |
Operating Segments [Member] | Bankers Fidelity [Member] | ||
Revenue and income (loss) before income taxes for each business unit [Abstract] | ||
Insurance premiums | 109,666 | 99,702 |
Insurance benefits and losses incurred | 83,029 | 68,789 |
Expenses deferred | (6,287) | (5,159) |
Amortization and depreciation expense | 2,825 | 3,667 |
Other expenses | 38,196 | 37,258 |
Total benefits and expenses | 117,763 | 104,555 |
Underwriting income (loss) | (8,097) | (4,853) |
Investment income | 5,021 | 5,725 |
Other income | 8 | 10 |
Operating income (loss) | (3,068) | 882 |
Net realized gains (losses) | 2,800 | 2,068 |
Income before income taxes | (268) | 2,950 |
Total revenues | 117,495 | 107,505 |
Intangibles | 1,194 | 1,194 |
Total assets | 185,624 | 168,657 |
Corporate and Other [Member] | ||
Revenue and income (loss) before income taxes for each business unit [Abstract] | ||
Insurance premiums | 0 | 0 |
Insurance benefits and losses incurred | 0 | 0 |
Expenses deferred | 0 | 0 |
Amortization and depreciation expense | 712 | 713 |
Other expenses | 16,191 | 15,761 |
Total benefits and expenses | 16,903 | 16,474 |
Investment income | 2,267 | 2,217 |
Other income | 7,806 | 7,518 |
Operating income (loss) | (6,830) | (6,739) |
Net realized gains (losses) | 3,887 | (1) |
Income before income taxes | (2,943) | (6,740) |
Total revenues | 13,960 | 9,734 |
Intangibles | 0 | 0 |
Total assets | 147,653 | 138,694 |
Adjustments & Eliminations [Member] | ||
Revenue and income (loss) before income taxes for each business unit [Abstract] | ||
Insurance premiums | 0 | 0 |
Insurance benefits and losses incurred | 0 | 0 |
Expenses deferred | 0 | 0 |
Amortization and depreciation expense | 0 | 0 |
Other expenses | (9,826) | (9,321) |
Total benefits and expenses | (9,826) | (9,321) |
Investment income | (2,124) | (1,926) |
Other income | (7,702) | (7,395) |
Operating income (loss) | 0 | 0 |
Net realized gains (losses) | 0 | 0 |
Income before income taxes | 0 | 0 |
Total revenues | (9,826) | (9,321) |
Intangibles | 0 | 0 |
Total assets | $ (116,351) | $ (112,472) |
Disclosures About Fair Value 64
Disclosures About Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2017 | Dec. 31, 2016 | |
Carrying Amount [Member] | |||
Assets [Abstract] | |||
Fixed maturities | [1] | $ 215,108 | $ 210,670 |
Equity securities | [1] | 23,355 | 20,257 |
Carrying Amount [Member] | Level 1 [Member] | |||
Assets [Abstract] | |||
Cash and cash equivalents | 24,547 | 13,252 | |
Carrying Amount [Member] | Level 2 [Member] | |||
Assets [Abstract] | |||
Policy loans | 2,146 | 2,265 | |
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 | 5,626 | 9,709 | |
Estimated Fair Value [Member] | |||
Assets [Abstract] | |||
Fixed maturities | [1] | 215,108 | 210,670 |
Equity securities | [1] | 23,355 | 20,257 |
Estimated Fair Value [Member] | Level 1 [Member] | |||
Assets [Abstract] | |||
Cash and cash equivalents | 24,547 | 13,252 | |
Estimated Fair Value [Member] | Level 2 [Member] | |||
Assets [Abstract] | |||
Policy loans | 2,146 | 2,265 | |
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 | $ 5,626 | $ 9,709 | |
[1] | See Note 2 for a description of the fair value hierarchy as well as a disclosure of levels for classes of these financial assets. |
Accumulated Other Comprehensi65
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Changes in balances of each component of accumulated other comprehensive income, net of taxes [Roll Forward] | ||
Beginning Balance | $ 105,506 | $ 102,492 |
Total other comprehensive income, net of tax | 3,921 | 1,246 |
Ending Balance | 112,983 | 105,506 |
AOCI Attributable to Parent [Member] | ||
Changes in balances of each component of accumulated other comprehensive income, net of taxes [Roll Forward] | ||
Beginning Balance | 5,830 | 4,584 |
Total other comprehensive income, net of tax | 3,921 | 1,246 |
Ending Balance | 9,751 | 5,830 |
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 | 5,830 | |
Other comprehensive income before reclassifications | 9,880 | |
Amounts reclassified from accumulated other comprehensive income | (5,959) | |
Total other comprehensive income, net of tax | 3,921 | |
Ending Balance | $ 9,751 | $ 5,830 |
Schedule II CONDENSED FINANCI66
Schedule II CONDENSED FINANCIAL INFORMATION OF REGISTRANT (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | ||
ASSETS [Abstract] | ||||||
Cash and cash equivalents | $ 13,252 | $ 13,252 | $ 24,547 | $ 13,252 | $ 15,622 | |
Investments | 247,511 | 244,177 | ||||
Investments in unconsolidated trusts | 1,238 | 1,238 | ||||
Other assets | 5,089 | 5,208 | ||||
Total assets | 343,239 | 318,600 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY [Abstract] | ||||||
Deferred tax liability, net | 593 | 0 | ||||
Junior subordinated debentures | 33,738 | 33,738 | ||||
Total liabilities | 230,256 | 213,094 | ||||
Shareholders' equity | 112,983 | 105,506 | 102,492 | |||
Total liabilities and shareholders' equity | 343,239 | 318,600 | ||||
REVENUE [Abstract] | ||||||
Other | 123 | 133 | ||||
Total revenue | 181,114 | 166,077 | ||||
INTEREST EXPENSE | 1,723 | 1,562 | ||||
INCOME TAX BENEFIT | (828) | (888) | ||||
Net income | 4,528 | 2,636 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES [Abstract] | ||||||
Net income | 4,528 | 2,636 | ||||
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | ||||||
Realized investment losses (gains), net | (9,168) | (2,595) | ||||
Depreciation and amortization | 1,438 | 1,205 | ||||
Compensation expense related to share awards | 495 | 586 | ||||
Deferred income tax benefit | (1,358) | (2) | ||||
Increase (decrease) in other liabilities | 5,665 | 1,649 | ||||
Other, net | 34 | 19 | ||||
Net cash provided by operating activities | 2,634 | 1,316 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES [Abstract] | ||||||
Proceeds from investments sold, called or matured | 10,791 | 10,874 | ||||
Investments purchased | (84,552) | (75,071) | ||||
Additions to property and equipment | (103) | (396) | ||||
Net cash provided by (used in) investing activities | 10,128 | (2,232) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES [Abstract] | ||||||
Payment of dividends on Series D preferred stock | (399) | (399) | ||||
Payment of dividends on common stock | (408) | (408) | ||||
Proceeds from shares issued under stock plans | 32 | 51 | ||||
Purchase of shares for treasury | (692) | (698) | ||||
Net cash used in financing activities | (1,467) | (1,454) | ||||
Net increase (decrease) in cash | 11,295 | (2,370) | ||||
Cash and cash equivalents at beginning of year | 13,252 | 15,622 | ||||
Cash and cash equivalents at end of year | 24,547 | 13,252 | ||||
Supplemental disclosure [Abstract] | ||||||
Cash paid for interest | 1,705 | 1,544 | ||||
Cash paid for income taxes | 1,400 | 675 | ||||
Parent Company [Member] | ||||||
ASSETS [Abstract] | ||||||
Cash and cash equivalents | 4,308 | 4,308 | 9,732 | 4,308 | $ 4,463 | |
Investments | 16,097 | 16,160 | ||||
Investment in subsidiaries | 116,351 | 112,472 | ||||
Investments in unconsolidated trusts | 1,238 | 1,238 | ||||
Income taxes receivable from subsidiaries | 2,879 | 2,961 | ||||
Other assets | 3,762 | 4,554 | ||||
Total assets | 150,059 | 141,693 | ||||
LIABILITIES AND SHAREHOLDERS' EQUITY [Abstract] | ||||||
Deferred tax liability, net | 1,253 | 500 | ||||
Other payables | 2,085 | 1,949 | ||||
Junior subordinated debentures | 33,738 | 33,738 | ||||
Total liabilities | 37,076 | 36,187 | ||||
Shareholders' equity | 112,983 | 105,506 | ||||
Total liabilities and shareholders' equity | $ 150,059 | $ 141,693 | ||||
REVENUE [Abstract] | ||||||
Fee income from subsidiaries | 7,702 | 7,395 | ||||
Distributed earnings from subsidiaries | 4,850 | 5,508 | ||||
Other | 4,130 | 408 | ||||
Total revenue | 16,682 | 13,311 | ||||
GENERAL AND ADMINISTRATIVE EXPENSES | 13,015 | 12,858 | ||||
INTEREST EXPENSE | 1,723 | 1,562 | ||||
Earnings before tax and equity in undistributed earnings (losses) of subsidiaries | 1,944 | (1,109) | ||||
INCOME TAX BENEFIT | [1] | (2,553) | (1,837) | |||
Earnings after tax but before equity in undistributed earnings (losses) of subsidiaries | 4,497 | 728 | ||||
EQUITY IN UNDISTRIBUTED EARNINGS OF SUBSIDIARIES, NET | 31 | 1,908 | ||||
Net income | 4,528 | 2,636 | ||||
CASH FLOWS FROM OPERATING ACTIVITIES [Abstract] | ||||||
Net income | 4,528 | 2,636 | ||||
Adjustments to reconcile net income to net cash provided by operating activities [Abstract] | ||||||
Realized investment losses (gains), net | (3,891) | 1 | ||||
Depreciation and amortization | 712 | 713 | ||||
Compensation expense related to share awards | 495 | 586 | ||||
Equity in undistributed earnings of consolidated subsidiaries | (31) | (1,908) | ||||
Decrease (increase) in intercompany taxes | 82 | (815) | ||||
Deferred income tax benefit | (1,358) | (2) | ||||
Increase (decrease) in other liabilities | 136 | (224) | ||||
Other, net | 295 | (221) | ||||
Net cash provided by operating activities | 968 | 766 | ||||
CASH FLOWS FROM INVESTING ACTIVITIES [Abstract] | ||||||
Proceeds from investments sold, called or matured | 6,014 | 1,979 | ||||
Investments purchased | 0 | (1,000) | ||||
Capital contribution to subsidiaries | 0 | (75) | ||||
Additions to property and equipment | (91) | (371) | ||||
Net cash provided by (used in) investing activities | 5,923 | 533 | ||||
CASH FLOWS FROM FINANCING ACTIVITIES [Abstract] | ||||||
Payment of dividends on Series D preferred stock | (399) | (399) | ||||
Payment of dividends on common stock | (408) | (408) | ||||
Proceeds from shares issued under stock plans | 32 | 51 | ||||
Purchase of shares for treasury | (692) | (698) | ||||
Net cash used in financing activities | (1,467) | (1,454) | ||||
Net increase (decrease) in cash | 5,424 | (155) | ||||
Cash and cash equivalents at beginning of year | 4,308 | 4,463 | ||||
Cash and cash equivalents at end of year | 9,732 | 4,308 | ||||
Supplemental disclosure [Abstract] | ||||||
Cash paid for interest | 1,705 | 1,544 | ||||
Cash paid for income taxes | 1,400 | 675 | ||||
Intercompany tax settlement from subsidiaries | $ 2,676 | $ 2,845 | ||||
[1] | Under the terms of a tax-sharing agreement, income tax provisions for the subsidiary companies are computed on a separate company basis. Accordingly, the Company's income tax benefit results from the utilization of the Parent's separate return loss to reduce the consolidated taxable income of the Company. |
Schedule III SUPPLEMENTARY IN67
Schedule III SUPPLEMENTARY INSURANCE INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |||
Supplementary Insurance Information, by Segment [Line Items] | |||||
Deferred Acquisition Costs | $ 32,694 | $ 28,975 | |||
Future Policy Benefits, Losses, Claims and Loss Reserves | 148,124 | [1] | 137,405 | [2] | |
Unearned Premiums | 23,449 | 23,208 | |||
Other Policy Claims and Benefits Payable | 2,010 | 2,066 | |||
Liability for future policy benefits | 82,435 | 74,843 | |||
Losses and claims | 65,689 | 62,562 | $ 63,870 | ||
Premium Revenue | 163,327 | 153,465 | |||
Net Investment Income | 7,707 | 9,307 | |||
Benefits, Claims, Losses and Settlement Expenses | 117,515 | 103,197 | |||
Amortization of Deferred Acquisition Costs | 10,630 | 11,884 | |||
Other Operating Expenses | 47,613 | 47,472 | |||
Casualty Premiums Written | 53,362 | 51,477 | |||
Bankers Fidelity [Member] | |||||
Supplementary Insurance Information, by Segment [Line Items] | |||||
Deferred Acquisition Costs | 30,619 | 26,791 | |||
Future Policy Benefits, Losses, Claims and Loss Reserves | 100,127 | 87,849 | |||
Unearned Premiums | 4,271 | 3,731 | |||
Other Policy Claims and Benefits Payable | 2,010 | 2,066 | |||
Premium Revenue | 109,666 | 99,702 | |||
Net Investment Income | 4,257 | 5,172 | |||
Benefits, Claims, Losses and Settlement Expenses | 83,029 | 68,789 | |||
Amortization of Deferred Acquisition Costs | 2,460 | 3,401 | |||
Other Operating Expenses | 32,274 | 32,365 | |||
Casualty Premiums Written | 0 | 0 | |||
American Southern [Member] | |||||
Supplementary Insurance Information, by Segment [Line Items] | |||||
Deferred Acquisition Costs | 2,075 | 2,184 | |||
Future Policy Benefits, Losses, Claims and Loss Reserves | 47,997 | 49,556 | |||
Unearned Premiums | 19,178 | 19,477 | |||
Other Policy Claims and Benefits Payable | 0 | 0 | |||
Premium Revenue | 53,661 | 53,763 | |||
Net Investment Income | 3,307 | 3,844 | |||
Benefits, Claims, Losses and Settlement Expenses | 34,486 | 34,408 | |||
Amortization of Deferred Acquisition Costs | 8,170 | 8,483 | |||
Other Operating Expenses | 8,262 | 7,954 | |||
Casualty Premiums Written | 53,362 | 51,477 | |||
Other [Member] | |||||
Supplementary Insurance Information, by Segment [Line Items] | |||||
Premium Revenue | 0 | 0 | |||
Net Investment Income | 143 | 291 | |||
Benefits, Claims, Losses and Settlement Expenses | 0 | 0 | |||
Amortization of Deferred Acquisition Costs | 0 | 0 | |||
Other Operating Expenses | 7,077 | 7,153 | |||
Casualty Premiums Written | $ 0 | $ 0 | |||
[1] | Includes future policy benefits of $82,435 and losses and claims of $65,689. | ||||
[2] | Includes future policy benefits of $74,843 and losses and claims of $62,562. |
Schedule IV REINSURANCE (Detail
Schedule IV REINSURANCE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Life Insurance in Force [Abstract] | ||
Direct Amount | $ 255,506 | $ 263,567 |
Ceded To Other Companies | (14,902) | (16,087) |
Assumed From Other Companies | 0 | 0 |
Net Amounts | 240,604 | 247,480 |
Premiums [Abstract] | ||
Direct Amount | 181,458 | 144,339 |
Ceded To Other Companies | (37,372) | (9,998) |
Assumed From Other Companies | 19,241 | 19,124 |
Net premiums earned | $ 163,327 | $ 153,465 |
Percentage of Amount Assumed to Net | 11.80% | 12.50% |
Bankers Fidelity [Member] | ||
Premiums [Abstract] | ||
Direct Amount | $ 142,210 | $ 104,996 |
Ceded To Other Companies | (32,585) | (5,344) |
Assumed From Other Companies | 41 | 50 |
Net premiums earned | $ 109,666 | $ 99,702 |
Percentage of Amount Assumed to Net | 0.00% | 0.10% |
American Southern [Member] | ||
Premiums [Abstract] | ||
Direct Amount | $ 39,248 | $ 39,343 |
Ceded To Other Companies | (4,787) | (4,654) |
Assumed From Other Companies | 19,200 | 19,074 |
Net premiums earned | $ 53,661 | $ 53,763 |
Percentage of Amount Assumed to Net | 35.80% | 35.50% |
Schedule VI SUPPLEMENTAL INFO69
Schedule VI SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2017 | Dec. 31, 2016 | |
Schedule VI SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS [Abstract] | ||
Deferred Policy Acquisition Costs | $ 2,075 | $ 2,184 |
Reserves | 47,997 | 49,556 |
Unearned Premiums | 19,178 | 19,477 |
Earned Premiums | 53,661 | 53,763 |
Net Investment Income | 3,307 | 3,844 |
Claims and Claim Adjustment Expenses Incurred Related To Current Year | 37,016 | 36,541 |
Claims and Claim Adjustment Expenses Incurred Related To Prior Years | (2,530) | (2,133) |
Amortization of Deferred Acquisition Costs | 8,170 | 8,483 |
Paid Claims and Claim Adjustment Expenses | 33,459 | 34,219 |
Premiums Written | $ 53,362 | $ 51,477 |