Humana 2005 Annual Report Download - page 83

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Humana Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Unrealized losses at December 31, 2005 resulted from 447 positions out of a total of 731 positions held.
Approximately 26% of the carrying value of our consolidated investment securities have been in an unrealized
loss position greater than one year. The unrealized losses at December 31, 2005 primarily were caused by
increases in interest rates. All issuers of securities trading at an unrealized loss remain current on all contractual
payments and we believe it is probable that we will be able to collect all amounts due according to the
contractual terms of the debt securities. After taking into account these and other factors, including the severity
of the decline and our ability and intent to hold these securities until recovery or maturity, we determined the
unrealized losses on these investment securities were temporary and, as such, no impairment was required.
The contractual maturities of debt securities available for sale at December 31, 2005, regardless of their
balance sheet classification, are shown below. Expected maturities may differ from contractual maturities
because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.
Amortized
Cost Fair Value
(in thousands)
Due within one year .................................. $ 262,934 $ 313,692
Due after one year through five years ..................... 819,201 806,441
Due after five years through ten years .................... 581,570 572,478
Due after ten years .................................... 1,017,091 1,028,210
Total debt securities .............................. $2,680,796 $2,720,821
Gross realized investment gains were $21.8 million in 2005, $36.6 million in 2004, and $52.8 million in
2003. Gross realized gains included gains from the sale of venture capital investments of $5.7 million in 2005,
$16.0 million in 2004, and $15.2 million in 2003.
Gross realized investment losses were $3.5 million in 2005, $8.4 million in 2004, and $16.2 million in 2003.
There were no impairment losses in 2005 or 2004. Gross realized losses included impairment losses of $3.2
million in 2003 after an evaluation indicated that a decline in fair value below the cost basis was other than
temporary.
We participate in a securities lending program where we loan certain investment securities for short periods
of time in exchange for collateral, consisting of cash or U.S. Government securities, initially equal to at least
102% of the fair value of the investment securities on loan. As of December 31, 2005, investment securities with
a fair value of $134.2 million were on loan. Net investment income earned on securities lending transactions was
$0.2 million in 2005, 2004 and 2003.
5. PROPERTY AND EQUIPMENT, NET
Property and equipment was comprised of the following at December 31, 2005 and 2004:
2005 2004
(in thousands)
Land ................................................................. $ 16,699 $ 19,329
Buildings ............................................................. 278,405 256,997
Equipment and computer software ......................................... 936,463 786,713
Assets held for sale ..................................................... 9,786 6,172
1,241,353 1,069,211
Accumulated depreciation ................................................ (756,941) (669,705)
Property and equipment, net .......................................... $ 484,412 $ 399,506
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