What changed in this filing

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Item 1. Financial Statements

2022-08-09 compared with 2022-05-10 · 228 added, 95 removed, 619 unchanged (34% of the section changed)

2 unchanged sentences

Consolidated Balance Sheets

As of March 31, 2022 and December 31, 2021

As of June 30, 2022 and December 31, 2021

(in thousands)

2 unchanged sentences

Fixed maturity securities, available-for-sale, at fair value (amortized cost:

March 31, 2022:

June 30, 2022:

December 31, 2021:

1 unchanged sentence

Equity securities, at fair value (cost:

March 31, 2022:

June 30, 2022:

December 31, 2021:

13 unchanged sentences

Other assets 2,322 1,771

Current income taxes receivable 390 —

$ 325,192 $ 331,488

7 unchanged sentences

Deferred income taxes, net

11,436 13,121

Total liabilities

5 unchanged sentences

Common stock – no par value ( 10,000 authorized shares;

1,897 and 1,895 shares issued and outstanding as of March 31, 2022 and December 31, 2021, respectively, excluding in each period 292 shares of common stock held by the Company)

1,897 and 1,895 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively, excluding in each period 292 shares of common stock held by the Company)

Retained earnings

8 unchanged sentences

Consolidated Statements of Operations

For the Three Months Ended March 31, 2022 and 2021

For the Three and Six Months Ended June 30, 2022 and 2021

(in thousands, except per share amounts)

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Net premiums written $ 69,626 $ 67,527 $ 132,751 $ 129,004

24 unchanged sentences

Consolidated Statements of Comprehensive Income

For the Three Months Ended March 31, 2022 and 2021

For the Three and Six Months Ended June 30, 2022 and 2021

(in thousands)

Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Net income $ 2,279 $ 19,782 $ 8,464 $ 33,605

Other comprehensive loss, before tax:

Other comprehensive (loss) income, before income tax:

Accumulated postretirement benefit obligation adjustment ( 8 ) — 211 —

Net unrealized losses on investments arising during the period ( 2,764 ) ( 750 )

Net unrealized (losses) gains on investments arising during the period ( 1,178 ) 59 ( 3,942 ) ( 691 )

Reclassification adjustment for sale of securities included in net income 46 53 46 30

Other comprehensive loss, before tax ( 2,545 ) ( 773 )

Income tax expense related to postretirement health benefits 46 —

Income tax benefit related to net unrealized losses on investments arising during the period ( 583 ) ( 158 )

Income tax benefit related to reclassification adjustment for sale of securities included in net income — ( 5 )

Net income tax benefit on other comprehensive loss ( 537 ) ( 163 )

Other comprehensive loss ( 2,008 ) ( 610 )

Reclassification adjustment for write-down of securities included in net income 127 — 127 —

Other comprehensive (loss) income, before income tax ( 1,013 ) 112 ( 3,558 ) ( 661 )

Income tax (benefit) expense related to postretirement health benefits ( 2 ) — 44 —

Income tax (benefit) expense related to net unrealized (losses) gains on investments arising during the period ( 252 ) 12 ( 835 ) ( 146 )

Income tax expense related to reclassification adjustment for sale of securities included in net income 10 11 10 6

Income tax expense related to reclassification adjustment for write-down of securities included in net income 29 — 29 —

Net income tax (benefit) expense on other comprehensive (loss) income ( 215 ) 23 ( 752 ) ( 140 )

Other comprehensive (loss) income ( 798 ) 89 ( 2,806 ) ( 521 )

Comprehensive Income $ 1,481 $ 19,871 $ 5,658 $ 33,084

2 unchanged sentences

Consolidated Statements of Stockholders’ Equity

For the Three Months Ended March 31, 2022 and 2021

For the Three and Six Months Ended June 30, 2022 and 2021

(in thousands, except per share amounts)

3 unchanged sentences

Shares Amount

Balance, December 31, 2020

Balance, March 31, 2021

1,894 $ — $ 209,157 $ 3,716 $ 212,873

Net income 19,782 19,782

Dividends paid ($ 0.46 per share)

( 873 ) ( 873 )

Share-based compensation expense related to stock appreciation rights

Net unrealized gain on investments 89 89

Balance, June 30, 2021

1,894 $ — $ 228,133 $ 3,805 $ 231,938

Balance, March 31, 2022

1,897 $ — $ 231,274 $ 1,218 $ 232,492

Net income 2,279 2,279

Dividends paid ($ 0.46 per share)

( 872 ) ( 872 )

Share-based compensation expense related to stock appreciation rights

Accumulated postretirement benefit obligation adjustment ( 6 ) ( 6 )

Net unrealized loss on investments ( 792 ) ( 792 )

Balance, June 30, 2022

1,897 $ — $ 232,759 $ 420 $ 233,179

Common Stock Retained Earnings Accumulated

Comprehensive

Stockholders’

Shares Amount

Balance, December 31, 2020

1,892 $ — $ 196,096 $ 4,326 $ 200,422

Net income 33,605 33,605

Dividends paid ($ 0.90 per share)

( 1,705 ) ( 1,705 )

Exercise of stock appreciation rights

2 unchanged sentences

Net unrealized loss on investments ( 521 ) ( 521 )

Balance, March 31, 2021

Balance, June 30, 2021

1,894 $ — $ 228,133 $ 3,805 $ 231,938

1 unchanged sentence

1,895 $ — $ 225,861 $ 3,226 $ 229,087

Net income 8,464 8,464

Dividends paid ($ 0.92 per share)

5 unchanged sentences

Net unrealized loss on investments ( 2,973 ) ( 2,973 )

Balance, March 31, 2022

Balance, June 30, 2022

1,897 $ — $ 232,759 $ 420 $ 233,179

2 unchanged sentences

Consolidated Statements of Cash Flows

For the Three Months Ended March 31, 2022 and 2021

For the Six Months Ended June 30, 2022 and 2021

(in thousands)

Three Months Ended

Six Months Ended

Operating Activities

15 unchanged sentences

(Increase) decrease in operating lease right-of-use assets ( 1,359 ) 150

Increase in current income taxes receivable ( 390 ) ( 804 )

Decrease in accounts payable and accrued liabilities ( 3,613 ) ( 1,296 )

Increase (decrease) in operating lease liabilities 1,375 ( 159 )

Increase in current income taxes payable 2,835 2,739

Decrease in current income taxes payable ( 3,329 ) ( 638 )

Payments of claims, net of recoveries ( 1,637 ) ( 1,308 )

1 unchanged sentence

Investing Activities

Purchases of fixed maturities ( 350 ) —

Purchases of equity securities ( 1,146 ) ( 1,468 )

1 unchanged sentence

Purchases of other investments ( 939 ) ( 414 )

Purchases of subsidiary, net of cash ( 4,927 ) —

Proceeds from sales and maturities of fixed maturity securities 14,496 27,562

2 unchanged sentences

Proceeds from sales and distributions of other investments 3,054 2,397

Proceeds from sales of other assets — 1

Purchases of property ( 2,452 ) ( 6,060 )

Proceeds from the sale of property 37 5,321

Net (used in) provided by investing activities ( 333 ) 1,836

Net cash (used in) provided by investing activities ( 8,230 ) 3,078

Financing Activities

2 unchanged sentences

Net cash used in financing activities ( 1,746 ) ( 1,706 )

Net Increase in Cash and Cash Equivalents 142 9,241

Net (Decrease) Increase in Cash and Cash Equivalents ( 1,682 ) 17,860

Cash and Cash Equivalents, Beginning of Period 37,168 13,723

1 unchanged sentence

Consolidated Statements of Cash Flows, continued

Three Months Ended

Six Months Ended

Supplemental Disclosures:

Cash Paid During the Year for:

Income tax refund, net $ ( 79 ) $ —

Income tax payments, net $ 9,709 $ 7,423

Non-Cash Investing and Financing Activities:

Non-cash net unrealized loss on investments, net of deferred tax benefit of $ 583 and $ 163 for March 31, 2022 and 2021, respectively

Non-cash net unrealized loss on investments, net of deferred tax benefit of $ 835 and $ 140 for June 30, 2022 and 2021, respectively

$ 2,973 $ 521

Adjustments to postretirement benefits obligation, net of deferred tax expense of $( 46 ) and $ 0 for March 31, 2022 and 2021, respectively

Adjustments to postretirement benefits obligation, net of deferred tax expense of $( 44 ) and $ 0 for June 30, 2022 and 2021, respectively

$ ( 167 ) $ —

Changes in Financial Statement Amounts Related to Purchase of Subsidiaries, Net of Cash Received:

Goodwill and other intangibles acquired $ ( 3,028 ) $ —

Title plant acquired ( 500 ) —

Prepaid and other assets acquired ( 77 ) —

Fixed assets acquired ( 1,322 ) —

Purchase of subsidiary, net of cash received $ ( 4,927 ) $ —

Refer to notes to the Consolidated Financial Statements.

2 unchanged sentences

Notes to Consolidated Financial Statements

March 31, 2022

June 30, 2022

Note 1 – Basis of Presentation and Significant Accounting Policies

5 unchanged sentences

All such adjustments are of a normal recurring nature.

Operating results for the three-month period ended March 31, 2022 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, 2022 or any other interim period.

Operating results for the three- and six-month periods ended June 30, 2022 are not necessarily indicative of the financial condition and results that may be expected for the year ending December 31, 2022 or any other interim period.

Use of Estimates and Assumptions – The preparation of the Company’s unaudited Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, and disclosures of contingent assets and liabilities, at the date of the unaudited Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period.

2 unchanged sentences

Note 2 – Reserve for Claims

Activity in the reserve for claims for the three-month period ended March 31, 2022 and the year ended December 31, 2021 are summarized as follows:

(in thousands) March 31, 2022 December 31, 2021

Activity in the reserve for claims for the six-month period ended June 30, 2022 and the year ended December 31, 2021 is summarized as follows:

(in thousands) June 30, 2022 December 31, 2021

Balance, beginning of period $ 36,754 $ 33,584

3 unchanged sentences

$ 36,603 $ 36,754

The total reserve for all reported and unreported losses the Company incurred through March 31, 2022 is represented by the reserve for claims on the unaudited Consolidated Balance Sheets.

The total reserve for all reported and unreported losses the Company incurred through June 30, 2022 is represented by the reserve for claims on the unaudited Consolidated Balance Sheets.

The Company's reserves for unpaid losses and loss adjustment expenses are established using estimated amounts required to settle claims for which notice has been received (reported) and the amount estimated to be required to satisfy claims that have been incurred but not yet reported (“IBNR”).

Despite the variability of such estimates, management believes that the total reserve for claims is adequate to cover claim losses which might result from pending and future claims under title insurance policies issued through March 31, 2022.

Management continually reviews and adjusts its reserve for claims estimates to reflect its loss experience and any new information that becomes available.

1 unchanged sentence

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

(in thousands, except percentages) March 31, 2022 % December 31, 2021 %

(in thousands, except percentages) June 30, 2022 % December 31, 2021 %

Known title claims $ 3,380 9.2 $ 3,317 9.0

10 unchanged sentences

Under the treasury stock method, when share-based awards are assumed to be exercised, (a) the exercise price of a share-based award and (b) the amount of compensation cost, if any, for future services that the Company has not yet recognized, are assumed to be used to repurchase shares in the current period.

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

The following table sets forth the computation of basic and diluted earnings per share for the three- and six-month periods ended June 30:

Three Months Ended

June 30, Six Months Ended

(in thousands, except per share amounts)

2022 2021 2022 2021

Net income $ 2,279 $ 19,782 $ 8,464 $ 33,605

2 unchanged sentences

Weighted average common shares outstanding – Diluted

1,899 1,899 1,900 1,898

Basic earnings per common share $ 1.20 $ 10.44 $ 4.46 $ 17.74

Diluted earnings per common share $ 1.20 $ 10.42 $ 4.45 $ 17.70

There were 0 and 15 thousand potential shares excluded from the computation of diluted earnings per share for the three-month periods ended March 31, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards.

There were 13 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the three-month periods ended June 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards.

There were 13 thousand and 14 thousand potential shares excluded from the computation of diluted earnings per share for the six-month periods ended June 30, 2022 and 2021, respectively, due to the out-of-the-money status of the related share-based awards.

The Company historically has adopted employee stock award plans under which restricted stock, options or stock appreciation rights ("SARs") exercisable for the Company's stock may be granted to key employees or directors of the Company.

1 unchanged sentence

The awards eligible to be granted under the active plan are limited to SARs, and the maximum aggregate number of shares of common stock of the Company available pursuant to the plan for the grant of SARs is 250 thousand shares.

As of March 31, 2022, the only outstanding awards under the plans were SARs, which expire within seven years or less from the date of grant.

SARs give the holder the right to receive stock equal to the appreciation in the value of shares of stock from the grant date for a specified period of time, and as a result, are accounted for as equity instruments.

As of June 30, 2022, the only outstanding awards under the plans were SARs, which expire within seven years or less from the date of grant.

All outstanding SARs vest and are exercisable within five years or less from the date of grant, and all SARs issued to date have been share-settled only.

11 unchanged sentences

SARs exercised ( 4 ) 89.23

Outstanding as of March 31, 2022 31 $ 158.22 4.02 $ 1,400

Exercisable as of March 31, 2022 26 $ 161.73 3.76 $ 1,067

Unvested as of March 31, 2022 5 $ 141.50 5.25 $ 333

There was approximately $ 102 thousand and $ 71 thousand of compensation expense relating to SARs vesting on or before March 31, 2022 and 2021, respectively, included in personnel expenses in the unaudited Consolidated Statements of Operations.

As of March 31, 2022, there was $ 206 thousand of unrecognized compensation expense related to unvested share-based compensation arrangements granted under the Company’s stock award plans.

Outstanding as of June 30, 2022 36 $ 159.32 4.16 $ 407

Exercisable as of June 30, 2022 27 $ 161.95 3.65 $ 324

Unvested as of June 30, 2022 9 $ 151.27 5.73 $ 83

During the second quarters of both 2022 and 2021, the Company issued 5 thousand share-settled SARs to directors of the Company.

The fair value of each award is estimated on the date of grant using the Black-Scholes option valuation model with the weighted average assumptions noted in the table shown below.

Expected volatilities are based on both the implied and historical volatility of the Company’s stock.

The Company uses historical data to project SAR exercises and pre-exercise forfeitures within the valuation model.

The expected term of awards represents the period of time that SARs granted are expected to be outstanding.

The interest rate assumed for the expected life of the award is based on the U.S.

Treasury yield curve in effect at the time of the grant.

The weighted average fair value for the SARs issued during 2022 and 2021 were $ 69.64 and $ 59.83 , respectively, and were estimated using the weighted average assumptions shown in the table below:

Expected Life in Years 7.0 7.0

Volatility 35.0 % 33.9 %

Interest Rate 2.9 % 1.3 %

Yield Rate 0.1 % 1.1 %

There was approximately $ 180 thousand and $ 139 thousand of compensation expense relating to SARs vesting on or before June 30, 2022 and 2021, respectively, included in personnel expenses in the unaudited Consolidated Statements of Operations.

As of June 30, 2022, there was $ 441 thousand of unrecognized compensation expense related to unvested share-based compensation arrangements granted under the Company’s stock award plans.

Note 4 – Segment Information

3 unchanged sentences

Title insurance policies insure titles to real estate.

Provided below is selected financial information about the Company's operations by segment for the periods ended March 31, 2022 and 2021:

Provided below is selected financial information about the Company's operations by segment for the periods ended June 30, 2022 and 2021:

Three Months Ended

March 31, 2022 (in thousands) Title

June 30, 2022 (in thousands) Title

Insurance All

2 unchanged sentences

Investment loss ( 9,544 ) ( 611 ) — ( 10,155 )

Net realized gain (loss) on investments 2,460 ( 422 ) — 2,038

Total revenues $ 76,394 $ 2,209 $ ( 7,701 ) $ 70,902

Operating expenses 72,234 3,265 ( 7,550 ) 67,949

Income (loss) before income taxes $ 4,160 $ ( 1,056 ) $ ( 151 ) $ 2,953

Total assets $ 249,160 $ 76,032 $ — $ 325,192

Three Months Ended

June 30, 2021 (in thousands) Title

Insurance All

Other Intersegment Eliminations Total

Insurance and other services revenues $ 74,599 $ 6,655 $ ( 3,685 ) $ 77,569

Investment income 6,504 706 — 7,210

Net realized gain on investments 161 21 — 182

Total revenues $ 81,264 $ 7,382 $ ( 3,685 ) $ 84,961

Operating expenses 60,521 2,686 ( 3,534 ) 59,673

Income before income taxes $ 20,743 $ 4,696 $ ( 151 ) $ 25,288

Total assets $ 239,572 $ 77,367 $ — $ 316,939

Six Months Ended

June 30, 2022 (in thousands) Title

Insurance All

Other Intersegment Eliminations Total

Insurance and other services revenues $ 156,543 $ 5,979 $ ( 12,589 ) $ 149,933

Investment loss ( 11,172 ) ( 2,646 ) — ( 13,818 )

Net realized gain on investments 2,511 1,274 — 3,785

Total revenues

$ 147,882 $ 4,607 $ ( 12,589 ) $ 139,900

2 unchanged sentences

$ 249,160 $ 76,032 $ — $ 325,192

Three Months Ended

March 31, 2021 (in thousands) Title

Six Months Ended

June 30, 2021 (in thousands) Title

Insurance All

9 unchanged sentences

Note 5 – Retirement Agreements and Other Postretirement Benefits

The Company’s subsidiary, Investors Title Insurance Company ("ITIC"), is a party to employment agreements with key executives that provide for the continuation of certain employee benefits and other payments due under the agreements upon retirement, estimated to total $ 14.2 million and $ 13.4 million as of March 31, 2022 and December 31, 2021, respectively.

The executive employee benefits include health, dental, vision and life insurance and are unfunded.

These amounts are classified as accounts payable and accrued liabilities in the unaudited Consolidated Balance Sheets.

The following sets forth the net periodic benefit cost for the executive benefits for the periods ended March 31, 2022 and 2021:

The following sets forth the net periodic benefit cost for the executive benefits for the periods ended June 30, 2022 and 2021:

Three Months Ended

June 30, Six Months Ended

(in thousands) 2022 2021 2022 2021

1 unchanged sentence

Interest cost on the projected benefit obligation 8 7 14 14

Amortization of unrecognized losses — —

Amortization of unrecognized gain ( 4 ) — ( 4 ) —

Net periodic benefit cost $ 4 $ 7 $ 10 $ 14

2 unchanged sentences

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

As of March 31, 2022 (in thousands) Amortized

As of June 30, 2022 (in thousands) Amortized

Losses Estimated Fair

20 unchanged sentences

The special revenue category for both periods presented includes approximately 40 individual fixed maturity securities with revenue sources from a variety of industry sectors.

The scheduled maturities of fixed maturity securities at March 31, 2022 are as follows:

The scheduled maturities of fixed maturity securities at June 30, 2022 are as follows:

Available-for-Sale

7 unchanged sentences

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

The following table presents the gross unrealized losses on fixed maturity securities and the estimated fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous loss position at March 31, 2022 and December 31, 2021:

Less than 12 Months 12 Months or Longer Total

As of March 31, 2022 (in thousands) Estimated

As of June 30, 2022 (in thousands) Estimated

Value Unrealized

3 unchanged sentences

Value Unrealized

General obligations of U.S.

states, territories and political subdivisions $ 5,582 $ ( 43 ) $ — $ — $ 5,582 $ ( 43 )

Special revenue issuer obligations of U.S.

23 unchanged sentences

Factors considered in determining whether a loss is temporary include the length of time and extent to which the estimated fair value has been below cost, the financial condition and prospects of the issuer (including credit ratings and analyst reports) and macro-economic changes.

A total of 13 and 9 fixed maturity securities had unrealized losses at March 31, 2022 and December 31, 2021, respectively.

A total of 41 and 9 fixed maturity securities had unrealized losses at June 30, 2022 and December 31, 2021, respectively.

The Company does not intend to sell any of these securities and believes that it is more likely than not that the Company will not have to sell any such securities before a recovery of cost.

2 unchanged sentences

Reviews of the values of fixed maturity securities are inherently uncertain and the value of the investment may not fully recover, or may decline in future periods, resulting in a realized loss.

The Company has not recorded any other-than-temporary impairment charges related to fixed maturity securities for the three-month periods ended March 31, 2022 and 2021.

The Company recorded $ 127 thousand in other-than-temporary impairment charges related to fixed maturity securities for the six-month period ended June 30, 2022 and had no recorded other-than-temporary impairment charges for six-month period ended June 30, 2021.

Expenses related to other-than-temporary impairments are recorded in net realized investment gains in the unaudited Consolidated Statements of Operations when recognized.

1 unchanged sentence

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

As of March 31, 2022 (in thousands)

As of June 30, 2022 (in thousands)

Cost Estimated Fair

9 unchanged sentences

Net Realized Investment Gains

Gross realized gains and losses on sales of investments for the three-month periods ended March 31, 2022 and 2021 are summarized as follows:

Gross realized gains and losses on sales of investments for the six-month periods ended June 30, 2022 and 2021 are summarized as follows:

(in thousands) 2022 2021

Gross realized gains from securities:

Corporate debt securities $ — $ 53

Common stocks

$ 4,556 $ 1,132

$ 1,747 $ 940

Gross realized losses from securities:

Corporate debt securities

$ ( 46 ) $ ( 24 )

Common stocks

( 189 ) ( 606 )

Other-than-temporary impairment of securities ( 127 ) —

$ ( 362 ) $ ( 630 )

Net realized gains from securities

3 unchanged sentences

Losses on other investments ( 409 ) —

$ ( 409 ) $ 1

Net realized investment gains

5 unchanged sentences

this power resides with a third-party general partner or managing member that cannot be removed except for cause.

The following table sets forth details about the Company's variable interest investments in VIEs, which are structured either as limited partnerships ("LPs") or limited liability companies ("LLCs"), as of March 31, 2022:

(in thousands) Balance Sheet Classification Carrying Value Estimated Fair Value Maximum Potential Loss (a)

Tax credit LPs Other investments $ 276 $ 276 $ 1,768

Real estate LLCs or LPs Other investments $ 3,528 $ 4,648 $ 5,408

17 unchanged sentences

Factors that are used in determining estimated fair market value include benchmark yields, reported trades, broker/dealer quotes, issuer spreads, two-sided markets, benchmark securities, bids, offers and reference data.

The Company receives one quote per security from a third-party pricing service, although as discussed below, the Company does consult other pricing resources when confirming that the prices it obtains reflect the fair values of the instruments in accordance with Accounting Standards Codification ("ASC") 820 , Fair Value Measurement .

Generally, quotes obtained from the pricing service for instruments classified as Level 2 are not adjusted and are not binding.

As of March 31, 2022 and December 31, 2021, the Company did not adjust any Level 2 fair values.

As of June 30, 2022 and December 31, 2021, the Company did not adjust any Level 2 fair values.

A number of the Company’s investment grade corporate debt securities are frequently traded in active markets, and trading prices are consequently available for these securities.

3 unchanged sentences

These derived fair value estimates are significantly affected by the assumptions used.

Additionally, ASC 825, Financial Instruments , excludes from its scope certain financial instruments, including those related to insurance contracts, pension and other postretirement benefits, and equity method investments.

Additionally, certain financial instruments, including those related to insurance contracts, pension and other postretirement benefits, and equity method investments are excluded from the scope of disclosures.

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

10 unchanged sentences

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

The following table presents, by level, fixed maturity securities carried at estimated fair value as of March 31, 2022 and December 31, 2021:

As of March 31, 2022 (in thousands) Level 1 Level 2 * Level 3 Total

The following table presents, by level, fixed maturity securities carried at estimated fair value as of June 30, 2022 and December 31, 2021:

As of June 30, 2022 (in thousands) Level 1 Level 2 * Level 3 Total

Fixed maturity securities:

10 unchanged sentences

*Denotes fair market value obtained from pricing services.

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of March 31, 2022 and December 31, 2021:

As of March 31, 2022 (in thousands) Level 1 Level 2 Level 3 Total

The following table presents, by level, estimated fair values of equity investments and other financial instruments as of June 30, 2022 and December 31, 2021:

As of June 30, 2022 (in thousands) Level 1 Level 2 Level 3 Total

Financial assets:

2 unchanged sentences

Accrued interest and dividends

1,000 — — 1,000

Equity securities, at fair value:

2 unchanged sentences

Short-term investments:

Money market funds 58,555 — — 58,555

Money market funds and US treasury bills 71,319 — — 71,319

Other investments:

16 unchanged sentences

$ 160,768 $ — $ 8,688 $ 169,456

The Company did not hold any Level 3 category debt or marketable equity investment securities as of March 31, 2022 or December 31, 2021.

The Company did not hold any Level 3 category debt or marketable equity investment securities as of June 30, 2022 or December 31, 2021.

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

To help ensure that estimated fair value determinations are consistent with ASC 820, prices from our pricing services go through multiple review processes to ensure appropriate pricing.

To help ensure that estimated fair value determinations are consistent with GAAP, prices from our pricing services go through multiple review processes to ensure appropriate pricing.

Pricing procedures and inputs used to price each security include, but are not limited to, the following:

11 unchanged sentences

If any such investment is determined to be other-than-temporarily impaired, an impairment charge is recorded against such investment and reflected in the unaudited Consolidated Statements of Operations.

There were no impairments of such investments made during the three-month period ended March 31, 2022 or the twelve-month period ended December 31, 2021.

The following table presents a rollforward of equity investments under the measurement alternative and real estate investments as of March 31, 2022 and December 31, 2021:

There were no impairments of such investments made during the six-month period ended June 30, 2022 or the twelve-month period ended December 31, 2021.

The following table presents a rollforward of equity investments under the measurement alternative and real estate investments as of June 30, 2022 and December 31, 2021:

(in thousands) Balance,

1 unchanged sentence

Paid Sales, Returns of Capital and Other Reductions Balance,

March 31, 2022

June 30, 2022

Other investments:

22 unchanged sentences

Another Company wholly owned subsidiary, Investors Title Accommodation Corporation (“ITAC”), serves as exchange accommodation titleholder and, through LLCs that are wholly owned subsidiaries of ITAC, holds property for exchangers in reverse exchange transactions.

Like-kind exchange deposits and reverse exchange property totaled approximately $ 571.4 million and $ 763.9 million as of March 31, 2022 and December 31, 2021, respectively.

Like-kind exchange deposits and reverse exchange property totaled approximately $ 484.4 million and $ 763.9 million as of June 30, 2022 and December 31, 2021, respectively.

These amounts are not considered assets of the Company and, therefore, are excluded from the accompanying unaudited Consolidated Balance Sheets;

20 unchanged sentences

(in thousands) As of

March 31, 2022 As of

June 30, 2022 As of

December 31, 2021

4 unchanged sentences

(in thousands) Three Months Ended

June 30, Six Months Ended

2022 2021 2022 2021

Net premiums written $ 7,402 $ 7,165 $ 13,986 $ 13,934

2 unchanged sentences

Note 9 – Intangible Assets, Goodwill and Title Plants

The Company evaluates nonorganic growth opportunities, such as acquisitions of title insurance agencies, from time to time in the ordinary course of business.

During the six-month period ended June 30, 2022, a subsidiary of the Company acquired a title insurance agency doing business in the state of Texas.

Intangible Assets

The estimated fair values of intangible assets recognized as the result of title insurance agency acquisitions, all Level 3 inputs, are principally based on values obtained from an independent third-party valuation service.

In accordance with ASC 350, Intangibles – Goodwill and Other , management determined that no events or changes in circumstances occurred during the three-month periods ended March 31, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that no identifiable intangible assets were impaired.

In accordance with ASC 350, Intangibles – Goodwill and Other , management determined that no events or changes in circumstances occurred during the six-month periods ended June 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that no identifiable intangible assets were impaired.

Identifiable intangible assets consist of the following:

(in thousands) As of

March 31, 2022 As of

June 30, 2022 As of

December 31, 2021

10 unchanged sentences

Goodwill and Title Plants

As of March 31, 2022, the Company recognized $ 7.2 million in goodwill and $ 857 thousand in title plants, net of impairments, as the result of title insurance agency acquisitions.

As of June 30, 2022, the Company recognized $ 9.7 million in goodwill and $ 1.4 million in title plants, net of impairments, as the result of title insurance agency acquisitions.

The title plants are included with other assets in the unaudited Consolidated Balance Sheets.

The fair values of goodwill and the title plants as of the date of acquisition, both Level 3 inputs, were principally based on values obtained from an independent third-party valuation service.

In accordance with ASC 350, management determined that no events or changes in circumstances occurred during the three-month periods ended March 31, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that there were no goodwill or title plant impairments.

In accordance with ASC 350, management determined that no events or changes in circumstances occurred during the six-month periods ended June 30, 2022 and 2021 that would indicate the carrying amounts may not be recoverable, and therefore, determined that there were no goodwill or title plant impairments.

Note 10 – Accumulated Other Comprehensive Income

The following table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the periods ended March 31, 2022 and 2021:

The following table provides changes in the balances of each component of accumulated other comprehensive income, net of tax, for the three- and six-month periods ended June 30, 2022 and 2021:

Three Months Ended

March 31, 2022 (in thousands) Unrealized Gains and Losses

June 30, 2022 (in thousands) Unrealized Gains and Losses

On Available-for-Sale

1 unchanged sentence

Benefits Plans

Beginning balance at March 31 $ 1,189 $ 29 $ 1,218

Other comprehensive loss before reclassifications ( 926 ) ( 6 ) ( 932 )

Amounts reclassified from accumulated other comprehensive income 134 — 134

Net current-period other comprehensive loss ( 792 ) ( 6 ) ( 798 )

Ending balance $ 397 $ 23 $ 420

Three Months Ended

June 30, 2021 (in thousands) Unrealized Gains and Losses

On Available-for-Sale

Securities Postretirement

Benefits Plans Total

Beginning balance at March 31 $ 3,860 $ ( 144 ) $ 3,716

Other comprehensive income before reclassifications 47 — 47

Amounts reclassified from accumulated other comprehensive income 42 — 42

Net current-period other comprehensive income 89 — 89

Ending balance

$ 3,949 $ ( 144 ) $ 3,805

Six Months Ended

June 30, 2022 (in thousands) Unrealized Gains and Losses

On Available-for-Sale

Securities Postretirement

Benefits Plans

Beginning balance at January 1 $ 3,370 $ ( 144 ) $ 3,226

3 unchanged sentences

Ending balance $ 397 $ 23 $ 420

Three Months Ended

March 31, 2021 (in thousands) Unrealized Gains and Losses

Six Months Ended

June 30, 2021 (in thousands) Unrealized Gains and Losses

On Available-for-Sale

7 unchanged sentences

$ 3,949 $ ( 144 ) $ 3,805

The following table provides significant amounts reclassified out of each component of accumulated other comprehensive income for the three-month periods ended March 31, 2022 and 2021:

The following table provides significant amounts reclassified out of each component of accumulated other comprehensive income for the three- and six-month periods ended June 30, 2022 and 2021:

Three Months Ended

March 31, 2022 (in thousands)

June 30, 2022 (in thousands)

Details about Accumulated Other

1 unchanged sentence

Unrealized gains and losses on available-for-sale securities:

Net realized gain (loss) on investments $ —

Net realized loss on investments $ ( 46 )

Other-than-temporary impairments ( 127 )

4 unchanged sentences

Three Months Ended

March 31, 2021 (in thousands)

June 30, 2021 (in thousands)

Details about Accumulated Other

1 unchanged sentence

Unrealized gains and losses on available-for-sale securities:

Net realized gain on investments $ 23

Net realized loss on investments $ ( 53 )

Other-than-temporary impairments —

3 unchanged sentences

Reclassifications for the period $ ( 42 )

Six Months Ended

June 30, 2022 (in thousands)

Details about Accumulated Other

Comprehensive Income Components (in thousands) Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the Consolidated Statements of Operations

Unrealized gains and losses on available-for-sale securities:

Net realized loss on investments $ ( 46 )

Other-than-temporary impairments ( 127 )

Total $ ( 173 ) Net realized investment gains

Tax 39 Provision for income taxes

Net of Tax $ ( 134 )

Reclassifications for the period $ ( 134 )

Six Months Ended

June 30, 2021 (in thousands)

Details about Accumulated Other

Comprehensive Income Components (in thousands) Amount Reclassified from Accumulated Other Comprehensive Income Affected Line Item in the Consolidated Statements of Operations

Unrealized gains and losses on available-for-sale securities:

Net realized loss on investments $ ( 30 )

Other-than-temporary impairments —

Total $ ( 30 ) Net realized investment gains

Tax 6 Provision for income taxes

Net of Tax $ ( 24 )

Reclassifications for the period $ ( 24 )

Note 11 – Revenue from Contracts with Customers

ASC 606, Revenue from Contracts with Customers , requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

GAAP requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

This guidance does not apply to revenue associated with insurance contracts (including title insurance policies), financial instruments and lease contracts;

11 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(in thousands) 2022 2021 2022 2021

5 unchanged sentences

Net premiums written 69,626 67,527 132,751 129,004

Investment-related revenue ( 1,916 ) 5,517

Investment-related (loss) revenue ( 8,117 ) 7,392 ( 10,033 ) 12,909

Other 348 4,147 647 4,355

13 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(in thousands) 2022 2021 2022 2021

7 unchanged sentences

(in thousands) As of

March 31, 2022 As of

June 30, 2022 As of

December 31, 2021

2 unchanged sentences

Total operating lease liabilities $ 6,704 $ 5,329

The future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of March 31, 2022, are summarized as follows:

The future minimum lease payments under operating leases that have initial or remaining noncancelable lease terms in excess of one year as of June 30, 2022, are summarized as follows:

Year Ended (in thousands)

4 unchanged sentences

Supplemental lease information is as follows:

March 31, 2022 As of

June 30, 2022 As of

December 31, 2021

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements