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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________________________________________
FORM 10-Q
________________________________________________________
(Mark One)
☒
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022

OR
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from                      to                     
Commission File Number 001-33251
________________________________________________________

uve-20220331_g1.jpg
UNIVERSAL INSURANCE HOLDINGS, INC.
(Exact name of registrant as specified in its charter)
________________________________________________________
Delaware65-0231984
(State or other jurisdiction of
incorporation or organization)		 (I.R.S. Employer
Identification No.)
1110 W. Commercial Blvd., Fort Lauderdale, Florida 33309
(Address of principal executive offices) (Zip Code)
(954) 958-1200
(Registrant’s telephone number, including area code)
________________________________________________________
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.01 Par ValueUVENew York Stock Exchange
    Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐ 

    Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒   No  ☐ 

    Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”

“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
☐
Accelerated filer
☒
Non-accelerated filer  
☐
Smaller reporting company
☐
Emerging growth company
☐
                
    If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

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

    Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 30,945,861 shares of common stock, par value $0.01 per share, outstanding on April 26, 2022.



UNIVERSAL INSURANCE HOLDINGS, INC.
TABLE OF CONTENTS
Page No.

2
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



To the Board of Directors and Stockholders of
Universal Insurance Holdings, Inc.
Fort Lauderdale, Florida

RESULTS OF REVIEW OF INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


We have reviewed the accompanying condensed consolidated balance sheet of Universal Insurance Holdings, Inc. and its wholly-owned subsidiaries (the “Company”) as of March 31, 2022 and the related condensed consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for the three-month periods ended March 31, 2022 and 2021. Based on our review, we are not aware of any material modifications that should be made to the accompanying interim financial statements for them to be in conformity with accounting principles generally accepted in the United States of America.

We have previously audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the consolidated balance sheet of Universal Insurance Holdings, Inc. as of December 31, 2021 and the related consolidated statements of income, comprehensive income, stockholders’ equity and cash flows for the year then ended (not presented herein) and we expressed an unqualified audit opinion on those consolidated financial statements in our report dated February 28, 2022. In our opinion, the information set forth in the accompanying consolidated balance sheet as of December 31, 2021, is fairly stated, in all material respects, in relation to the consolidated balance sheet from which it has been derived.

BASIS FOR REVIEW RESULTS

These interim financial statements are the responsibility of the Company’s management. We conducted our review in accordance with the standards of the PCAOB. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an audit conducted in accordance with the standards of the PCAOB, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.


We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

/s/ Plante & Moran, PLLC
East Lansing, Michigan
May 2, 2022

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PART I — FINANCIAL INFORMATION
Item 1. Financial Statements
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
(in thousands, except per share data)
 As of
March 31,December 31,
20222021
ASSETS
Available-for-sale debt securities, at fair value, net of allowance for credit loss of $572 and $489 (amortized cost: $1,092,438 and $1,061,192)
$1,014,677 $1,040,455 
Equity securities, at fair value (cost: $72,339 and $51,151)
65,126 47,334 
Investment real estate, net5,845 5,891 
Total invested assets1,085,648 1,093,680 
Cash and cash equivalents165,398 250,508 
Restricted cash and cash equivalents2,635 2,635 
Prepaid reinsurance premiums109,401 240,993 
Reinsurance recoverable104,660 185,589 
Premiums receivable, net61,670 64,923 
Property and equipment, net54,170 53,682 
Deferred policy acquisition costs103,622 108,822 
Income taxes recoverable2,262 16,947 
Deferred income tax asset, net40,072 16,331 
Other assets19,417 22,031 
Total assets$1,748,955 $2,056,141 
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES:
Unpaid losses and loss adjustment expenses$244,482 $346,216 
Unearned premiums839,647 857,769 
Advance premium85,120 53,694 
Book overdraft— 26,759 
Reinsurance payable, net12,723 188,662 
Commission payable23,484 22,315 
Other liabilities and accrued expenses43,774 27,348 
 Long-term debt, net103,384 103,676 
Total liabilities1,352,614 1,626,439 
Commitments and Contingencies (Note 12)
STOCKHOLDERS’ EQUITY:
Cumulative convertible preferred stock, $0.01 par value
— — 
Authorized shares - 1,000
Issued shares - 10 and 10
Outstanding shares - 10 and 10
Minimum liquidation preference, $9.99 and $9.99 per share
Common stock, $0.01 par value
471 470 
Authorized shares - 55,000
Issued shares - 47,063 and 47,018
Outstanding shares - 30,946 and 31,221
Treasury shares, at cost - 16,117 and 15,797
(230,994)(227,115)
Additional paid-in capital109,099 108,202 
Accumulated other comprehensive income (loss), net of taxes(58,478)(15,568)
Retained earnings576,243 563,713 
Total stockholders’ equity396,341 429,702 
Total liabilities and stockholders’ equity$1,748,955 $2,056,141 

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.
4
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited)
(in thousands, except per share data)
Three Months Ended
March 31,
20222021
PREMIUMS EARNED AND OTHER REVENUES
Direct premiums written$396,481 $365,314 
Change in unearned premium18,122 10,292 
Direct premium earned414,603 375,606 
Ceded premium earned(145,539)(132,301)
Premiums earned, net269,064 243,305 
Net investment income4,042 2,986 
Net realized gains (losses) on investments58 542 
Net change in unrealized gains (losses) of equity securities(3,396)(494)
Commission revenue11,161 9,126 
Policy fees4,779 5,387 
Other revenue1,774 1,905 
Total premiums earned and other revenues287,482 262,757 
OPERATING COSTS AND EXPENSES
Losses and loss adjustment expenses185,106 143,963 
General and administrative expenses78,297 82,423 
Total operating costs and expenses263,403 226,386 
Interest and amortization of debt issuance costs1,608 20 
INCOME (LOSS) BEFORE INCOME TAXES22,471 36,351 
Income tax expense (benefit)4,934 9,943 
NET INCOME (LOSS)$17,537 $26,408 
Basic earnings (loss) per common share$0.56 $0.85 
Weighted average common shares outstanding - Basic31,147 31,208 
Diluted earnings (loss) per common share$0.56 $0.84 
Weighted average common shares outstanding - Diluted31,227 31,277 
Cash dividend declared per common share$0.16 $0.16 
—


CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited)
Three Months Ended
March 31,
20222021
Net income (loss)$17,537 $26,408 
Other comprehensive income (loss), net of taxes(42,910)(16,910)
Comprehensive income (loss)$(25,373)$9,498 
The accompanying notes to condensed consolidated financial statements are an integral part of these statements.
5
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021 (unaudited)
(in thousands, except per share data) 

Treasury SharesCommon
Shares
Issued		Preferred
Shares
Issued		Common
Stock
Amount		Preferred
Stock
Amount		Additional
Paid-In
Capital		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)		Treasury
Shares,
at Cost		Total
Stockholders’
Equity
Balance, December 31, 2021(15,797)47,018 10 $470 $— $108,202 $563,713 $(15,568)$(227,115)$429,702 
Vesting of performance share units(9)
(1)
33 — 1 — (1)— — (104)(104)
Vesting of restricted stock units(6)
(1)
27 — — — — — — (105)(105)
Retirement of treasury shares15 
(1)
(15)— — — (209)— — 209 — 
Purchases of treasury stock(320)— — — — — — — (3,879)(3,879)
Share-based compensation— — — — — 1,107 — — — 1,107 
Net income— — — — — — 17,537 — — 17,537 
Other comprehensive loss, net of taxes— — — — — — — (42,910)— (42,910)
Declaration of dividends
($0.16 per common share and
$0.25 per preferred share)
— — — — — — (5,007)— — (5,007)
Balance, March 31, 2022(16,117)47,063 10 $471 $— $109,099 $576,243 $(58,478)$(230,994)$396,341 
(1) All shares acquired represent shares tendered to cover the strike price for options and tax withholdings on the intrinsic value of options exercised, restricted stock vested, performance share units vested, or restricted stock units vested. These shares have been cancelled by the Company.

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.
6
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (continued)
(in thousands, except per share data) 

Treasury SharesCommon
Shares
Issued		Preferred
Shares
Issued		Common
Stock
Amount		Preferred
Stock
Amount		Additional
Paid-In
Capital		Retained
Earnings		Accumulated
Other
Comprehensive
Income (Loss)		Treasury
Shares,
 at Cost		Total
Stockholders’
Equity
Balance, December 31, 2020(15,680)46,817 10 $468 $— $103,445 $567,512 $3,343 $(225,506)$449,262 
Vesting of performance share units(16)
(1)
62 — — — — — — (241)(241)
Vesting of restricted stock units(17)
(1)
65 — 1 — (1)— — (254)(254)
Retirement of treasury shares33 
(1)
(33)— — — (495)— — 495 — 
Purchases of treasury stock(15)— — — — — — — (245)(245)
Share-based compensation— — — — — 1,675 — — — 1,675 
Net income— — — — — — 26,408 — — 26,408 
Other comprehensive loss, net of taxes— — — — — — — (16,910)— (16,910)
Declaration of dividends
($0.16 per common share and
$0.25 per preferred share)
— — — — — — (5,030)— — (5,030)
Balance, March 31, 2021(15,695)46,911 10 $469 $— $104,624 $588,890 $(13,567)$(225,751)$454,665 
(1)
All shares acquired represent shares tendered to cover the strike price for options and tax withholdings on the intrinsic value of options exercised, restricted stock vested, performance share units vested, or restricted stock units vested. These shares have been cancelled by the Company.

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.
7
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
(in thousands)
Three Months Ended
March 31,
20222021
Cash flows from operating activities:
Net cash provided by operating activities$(27,081)$61,265 
Cash flows from investing activities:
Proceeds from sale of property and equipment1 16 
Purchases of property and equipment(2,185)(1,211)
Purchases of equity securities(29,333)(8,175)
Purchases of available-for-sale debt securities(57,163)(178,828)
Proceeds from sales of equity securities14,932 1,576 
Proceeds from sales of available-for-sale debt securities12,540 27,455 
Proceeds from sales of investment real estate— 2,591 
Maturities of available-for-sale debt securities12,766 25,178 
Net cash provided by (used in) investing activities(48,442)(131,398)
Cash flows from financing activities:
Debt issuance costs paid(100)— 
Preferred stock dividend(3)(3)
Common stock dividend(5,029)(5,083)
Purchase of treasury stock(3,879)(245)
Payments related to tax withholding for share-based compensation(209)(495)
Repayment of debt(367)(368)
Net cash provided by (used in) financing activities(9,587)(6,194)
Cash and cash equivalents and restricted cash and cash equivalents:
Net increase (decrease) during the period(85,110)(76,327)
Balance, beginning of period253,143 179,871 
Balance, end of period$168,033 $103,544 

The following table summarizes our cash and cash equivalents and restricted cash and cash equivalents within the Condensed Consolidated Balance Sheets (in thousands):
 March 31,December 31,
20222021
Cash and cash equivalents$165,398 $250,508 
Restricted cash and cash equivalents (1)2,635 2,635 
Total cash and cash equivalents and restricted cash and cash equivalents$168,033 $253,143 
(1)See “—Note 5 (Insurance Operations)” for a discussion of the nature of the restrictions for restricted cash and cash equivalents.




The accompanying notes to condensed consolidated financial statements are an integral part of these statements.
8
UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. Nature of Operations and Basis of Presentation
Nature of Operations
Universal Insurance Holdings, Inc. (“UVE”, and together with its wholly-owned subsidiaries, “the Company”) is a Delaware corporation incorporated in 1990. The Company is a vertically integrated insurance holding company performing all aspects of insurance underwriting, distribution and claims. Through its wholly-owned insurance company subsidiaries, Universal Property & Casualty Insurance Company (“UPCIC”) and American Platinum Property and Casualty Insurance Company (“APPCIC”, and together with UPCIC, the “Insurance Entities”), the Company is principally engaged in the property and casualty insurance business offered primarily through its network of independent agents. Risk from catastrophic losses is managed through the use of reinsurance agreements. The Company’s primary product is residential homeowners’ insurance offered in 19 states as of March 31, 2022, including Florida, which comprises the majority of the Company’s policies in force. See “—Note 5 (Insurance Operations)” for more information regarding the Company’s insurance operations.
The Company generates revenues primarily from the collection of premiums and investment returns on funds invested on cash flows in excess of those retained and used for claims-paying obligations and insurance operations. Other significant sources of revenue include brokerage commissions collected from reinsurers on certain reinsurance programs placed on behalf of the Insurance Entities, policy fees collected from policyholders by the Company’s wholly-owned managing general agent subsidiary and payment plan fees charged to policyholders who choose to pay their premiums in installments. The Company’s wholly-owned adjusting company receives claims-handling fees from the Insurance Entities. The Insurance Entities are reimbursed for these fees on claims that are subject to recovery under the Insurance Entities’ respective reinsurance programs. These fees, after expenses, are recorded in the Condensed Consolidated Financial Statements as an adjustment to losses and loss adjustment expense (“LAE”).
Basis of Presentation
The Company has prepared the accompanying unaudited Condensed Consolidated Financial Statements (“Financial Statements”) in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) for interim financial information. Accordingly, the Financial Statements do not include all of the information and footnotes required by United States Generally Accepted Accounting Principles (“U.S. GAAP”) for annual financial statements. Therefore, the Financial Statements should be read in conjunction with the audited Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the SEC on February 28, 2022. The Condensed Consolidated Balance Sheet at December 31, 2021 was derived from audited financial statements, but does not include all disclosures required by U.S. GAAP. In the opinion of management, all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation have been included in the Financial Statements. The results for interim periods do not necessarily indicate the results that may be expected for any other interim period or for the full year.
To conform to the current period presentation, certain amounts in the prior periods’ condensed consolidated financial statements and notes have been reclassified. Such reclassifications were of an immaterial amount and had no effect on net income or stockholders’ equity.
The Financial Statements include the accounts of the Company and its wholly-owned subsidiaries, as well as variable interest entities (“VIE”) in which the Company is determined to be the primary beneficiary. All material intercompany balances and transactions have been eliminated in consolidation.
The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. The Company’s primary use of estimates is in the recognition of liabilities for unpaid losses, loss adjustment expenses, subrogation recoveries and reinsurance recoveries. Actual results could differ from those estimates.

9
2. Significant Accounting Policies
The Company reported Significant Accounting Policies in its Annual Report on Form 10-K for the year ended December 31, 2021.

10
3. Investments
Available-for-Sale Securities
The following table provides the amortized cost and fair value of available-for-sale debt securities as of the dates presented (in thousands):
March 31, 2022
Amortized
Cost		Allowance for Expected Credit LossesGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair Value
Debt Securities:
  U.S. government obligations and agencies$22,380 $— $— $(719)$21,661 
  Corporate bonds722,680 (456)111 (52,427)669,908 
  Mortgage-backed and asset-backed securities323,684 — 38 (22,200)301,522 
  Municipal bonds14,924 — — (1,405)13,519 
  Redeemable preferred stock8,770 (116)— (587)8,067 
Total$1,092,438 $(572)$149 $(77,338)$1,014,677 

December 31, 2021
Amortized
Cost		Allowance for Expected Credit LossesGross
Unrealized
Gains		Gross
Unrealized
Losses		Fair Value
Debt Securities:
  U.S. government obligations and agencies$27,076 $— $64 $(334)$26,806 
  Corporate bonds687,058 (371)843 (13,725)673,805 
  Mortgage-backed and asset-backed securities322,844 — 194 (6,920)316,118 
  Municipal bonds14,925 (1)— (350)14,574 
  Redeemable preferred stock9,289 (117)28 (48)9,152 
Total$1,061,192 $(489)$1,129 $(21,377)$1,040,455 

The following table provides the credit quality of available-for-sale debt securities with contractual maturities as of the dates presented (dollars in thousands):
March 31, 2022December 31, 2021
Average Credit RatingsFair Value% of Total
 Fair Value		Fair Value% of Total
 Fair Value
AAA$309,960 30.5 %$321,975 31.0 %
AA139,554 13.8 %139,186 13.4 %
A330,751 32.6 %339,500 32.6 %
BBB227,901 22.5 %234,358 22.5 %
No Rating Available6,511 0.6 %5,436 0.5 %
   Total$1,014,677 100.0 %$1,040,455 100.0 %

The table above includes credit quality ratings by Standard and Poor’s Rating Services, Inc. (“S&P”), Moody’s Investors Service, Inc. and Fitch Ratings, Inc. The Company has presented the highest rating of the three rating agencies for each investment position.
11
The following table summarizes the amortized cost and fair value of mortgage-backed and asset-backed securities as of the dates presented (in thousands):
March 31, 2022December 31, 2021
Amortized
Cost		Fair ValueAmortized
Cost		Fair Value
Mortgage-backed securities:
Agency$146,674 $134,111 $147,992 $143,819 
Non-agency60,719 55,096 59,906 58,263 
Asset-backed securities:
Auto loan receivables68,485 66,410 67,352 66,877 
Credit card receivables4,711 4,668 4,741 4,719 
Other receivables43,095 41,237 42,853 42,440 
Total$323,684 $301,522 $322,844 $316,118 
The following tables summarize available-for-sale debt securities, aggregated by major security type and length of time that individual securities have been in a continuous unrealized loss position, for which no allowance for expected credit losses has been recorded as of the dates presented (in thousands):
March 31, 2022
Less Than 12 Months12 Months or Longer
Number of
Issues		Fair ValueUnrealized
Losses		Number of
Issues		Fair ValueUnrealized
Losses
Debt Securities:
U.S. government obligations and agencies2 $11,549 $(63)5 $10,112 $(656)
Corporate bonds188 253,022 (16,821)95 118,710 (12,044)
Mortgage-backed and asset-backed securities118 156,773 (7,653)70 138,894 (14,547)
Municipal bonds9 9,988 (932)1 3,531 (473)
Redeemable preferred stock4 1,270 (122)— — — 
Total321 $432,602 $(25,591)171 $271,247 $(27,720)

December 31, 2021
Less Than 12 Months12 Months or Longer
Number of
Issues		Fair ValueUnrealized
Losses		Number of
Issues		Fair ValueUnrealized
Losses
Debt Securities:
U.S. government obligations and agencies4 $18,913 $(111)4 $5,016 $(223)
Corporate bonds249 378,595 (7,468)18 17,356 (679)
Mortgage-backed and asset-backed securities145 274,883 (5,969)11 23,273 (951)
Municipal bonds5 9,811 (269)— — — 
Redeemable preferred stock1 200 (1)— — — 
Total404 $682,402 $(13,818)33 $45,645 $(1,853)

Unrealized losses on available-for-sale debt securities in the above table as of March 31, 2022 have not been recognized into income as credit losses because the issuers are of high credit quality (investment grade securities), management does not intend to sell and it is likely management will not be required to sell the securities prior to their anticipated recovery, and the decline in fair value is largely due to changes in interest rates and other market conditions. There were no material factors impacting any one category or specific security requiring an accrual for credit loss. The issuers continue to make principal and interest payments on the bonds. The fair value is expected to recover as the bonds approach maturity.

12

The following table presents a reconciliation of the beginning and ending balances for expected credit losses on available-for-sale debt securities (in thousands):
Corporate BondsMunicipal BondsRedeemable
 Preferred Stock		Total
Balance, December 31, 2020$148 $— $38 $186 
Provision for (or reversal of) credit loss expense223 1 79 303 
Balance, December 31, 2021371 1 117 489 
Provision for (or reversal of) credit loss expense85 (1)(1)83 
Balance, March 31, 2022$456 $— $116 $572 

For available-for-sale debt securities in an unrealized loss position, the Company first assesses whether it intends to sell, or is more likely than not that it will be required to sell the security before recovery of its amortized cost basis. If either of the criteria regarding intent or requirement to sell is met, the security’s amortized cost basis is written down to fair value through income. For available-for-sale debt securities that do not meet the aforementioned criteria, the Company evaluates whether the decline in fair value has resulted from credit losses or other factors. In making this assessment, management considers the extent to which fair value is less than amortized cost, any changes to the rating of the security by rating agencies, market sentiment and trends and adverse conditions specifically related to the security, among other quantitative and qualitative factors utilized for establishing an estimate for credit losses. If the assessment indicates that a credit loss exists, the present values of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses is recorded for the credit loss, limited by the amount that fair value is less than the amortized cost basis. Any impairment that has not been recorded through an allowance for credit losses is recognized in other comprehensive income.

Changes in the allowance for credit losses are recorded as a provision for (or reversal of) credit loss expense and are reported in general and administrative expenses in the Condensed Consolidated Statements of Income. Losses are charged against the allowance when management believes an available-for-sale debt security is confirmed as uncollected or when either of the criteria regarding intent or requirement to sell is met.
The following table presents the amortized cost and fair value of investments with maturities as of the date presented (in thousands):
March 31, 2022
Amortized CostFair Value
Due in one year or less$53,698 $53,176 
Due after one year through five years504,075 475,424 
Due after five years through ten years501,063 455,448 
Due after ten years31,710 28,916 
Perpetual maturity securities1,892 1,713 
Total$1,092,438 $1,014,677 

All securities, except those with perpetual maturities, were categorized in the table above utilizing years to effective maturity. Effective maturity takes into consideration all forms of potential prepayment, such as call features or prepayment schedules, that shorten the lifespan of contractual maturity dates.
13
The following table provides certain information related to available-for-sale debt securities, equity securities and investment in real estate during the periods presented (in thousands):
Three Months Ended
March 31,
20222021
Proceeds from sales and maturities (fair value):
  Available-for-sale debt securities $25,306 $52,633 
  Equity securities$14,932 $1,576 
Gross realized gains on sale of securities:
  Available-for-sale debt securities $6 $122 
  Equity securities$324 $343 
Gross realized losses on sale of securities:
  Available-for-sale debt securities$(270)$(324)
  Equity securities$(2)$— 
Realized gains on sales of investment real estate (1)$— $401 
(1)
During the first quarter of 2021, the Company completed the sale of a non-income producing investment real estate property. The Company received net cash proceeds of approximately $2.6 million and recognized a pre-tax gain of approximately $0.4 million that is included in net realized gains (losses) on investments in the Condensed Consolidated Statements of Income for the three months ended March 31, 2021.
The following table presents the components of net investment income, comprised primarily of interest and dividends, for the periods presented (in thousands):
Three Months Ended
March 31,
20222021
Available-for-sale debt securities$4,067 $2,829 
Equity securities535 591 
Cash and cash equivalents (1)22 11 
Other (2)128 268 
  Total investment income4,752 3,699 
Less: Investment expenses (3)(710)(713)
  Net investment income$4,042 $2,986 
(1)
Includes interest earned on restricted cash and cash equivalents.
(2)
Includes investment income earned on real estate investments.
(3)
Includes custodial fees, investment accounting and advisory fees, and expenses associated with real estate investments.

Equity Securities
The following table provides the unrealized gains and losses recognized for the periods presented on equity securities still held at the end of the reported period (in thousands):
Three Months Ended
March 31,
20222021
Unrealized gains (losses) recognized during the reported period on equity securities still held at the end of the reported period$(3,353)$(519)
14

Investment Real Estate
Investment real estate consisted of the following as of the dates presented (in thousands):
March 31,December 31,
20222021
Income Producing:
Investment real estate$7,091 $7,091 
Less: Accumulated depreciation(1,246)(1,200)
Investment real estate, net$5,845