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 ~~September 30, 2023~~March 31, 2024


☐			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 001-33493

GREENLIGHT CAPITAL RE, LTD.

(Exact name of registrant as specified in its charter)


Cayman Islands			N/A
(State or other jurisdiction of incorporation or organization)			(I.R.S. employer identification no.)
65 Market Street
Suite 1207, Jasmine Court
P.O. Box 31110
Camana Bay
Grand Cayman
Cayman Islands			KY1-1205
(Address of principal executive offices)			(Zip code)

(205) 291-3440

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary Shares	GLRE	Nasdaq Global Select Market

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, 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.


Ordinary Shares, $0.10 par value			~~35,337,407~~35,321,144
(Class)			Outstanding at ~~October 27, 2023~~May 3, 2024

GREENLIGHT CAPITAL RE, LTD.

TABLE OF CONTENTS


		Page
PART I — FINANCIAL INFORMATION
	Note on Forward-Looking Statements	3
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets as of ~~September 30, 2023~~March 31, 2024 (unaudited) and December 31, ~~2022 (unaudited)~~2023	4
	Condensed Consolidated Statements of Operations for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~ (unaudited)	5
	Condensed Consolidated Statements of Changes in Shareholders' Equity for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~ (unaudited)	6
	Condensed Consolidated Statements of Cash Flows for the ~~nine~~three months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~ (unaudited)	7
	Notes to the Condensed Consolidated Financial Statements (unaudited)	8
Item 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations	2322
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	4338
Item 4.	Controls and Procedures	4440
PART II — OTHER INFORMATION
Item 1.	Legal Proceedings	4541
Item 1A.	Risk Factors	4541
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	4541
Item 3.	Defaults Upon Senior Securities	4541
Item 4.	Mine Safety Disclosures	4541
Item 5.	Other Information	4541
Item 6.	Exhibits	4642
SIGNATURES		4642

Return to table of contents

PART I — FINANCIAL INFORMATION

NOTE OF FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q (herein referred as “Form 10-Q”) of Greenlight Capital Re, Ltd. (“Greenlight Capital Re,” “Company,” “us,” “we,” or “our”) contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, , and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical facts included in this report, including statements regarding estimates, projections, statements relating to our business plans, objectives, and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements”. We intend these forward-looking statements to be covered by the safe harbor provisions for forward-looking statements in the United States (“U.S.”) federal securities ~~laws.~~laws established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements generally are identified by the words “believe,” “project,” “predict,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are not historical facts, and are based on current expectations, estimates and projections, and various assumptions, many of which, are inherently uncertain and beyond management’s control.

Forward-looking statements contained in this Form 10-Q may include, but are not limited to, information regarding our estimates for catastrophes and weather-related losses (herein referred as “CAT losses”), measurements of potential losses in the fair market value of our investments, our expectations regarding the performance of our business, our financial results, our liquidity and capital resources, the outcome of our strategic initiatives, our expectations regarding pricing, and other market and economic conditions including inflation, our growth prospects, and valuations of the potential impact of movements in interest rates, equity securities’ prices, and foreign currency exchange rates.

Forward-looking statements only reflect our expectations and are not guarantees of performance. These statements involve risks, uncertainties and assumptions. Accordingly, ~~actual results may differ materially from the forward-looking statements.~~ ~~Important~~there are or will be important factors that could cause ~~our~~ actual events or results ~~and financial condition~~ to differ materially from those indicated in ~~the forward-looking statements~~such statements. We believe that these factors include, ~~among others, the following:~~but are not limited to:


			●•a downgrade or withdrawal of our A.M. Best ratings; •any suspension or revocation of any of our licenses; •losses from catastrophes and other major events; •the loss of significant brokers; and •those described under “Item 1A, Risk Factors” contained in our Annual Report on Form 10-K for the fiscal year ended December 31,2023, as filed with the SEC on March 5, 2024 (“2023 Form 10-K”), which is accessible on the SEC’s website at www.sec.gov.			~~Our results of operations fluctuate from period to period and may not be indicative of our long-term prospects.~~
			●			The impact of general economic, capital and credit market conditions, including banking sector instability, financial market illiquidity and fluctuations in interest rates, equity securities’ prices and/or foreign currency exchange rates.
			●			~~A downgrade or withdrawal of our A.M. Best ratings would materially and adversely affect our ability to implement our business strategy.~~
			●			~~Any suspension or revocation of any of our licenses would materially and adversely affect our business, financial condition and results of operations~~.
			●			Our investment performance depends in part on the performance of Solasglas Investments, LP (“SILP”) and may suffer as a result of adverse financial market developments or other factors that impact SILP’s liquidity, which could materially and adversely affect our investment results, financial condition and results of operations.
			●			The carry values of our investments made under our Greenlight Re Innovations pillar, which focuses on developing a range of risk products via strategic partnerships and other methods to access fee income, a stream of underwriting business, and investment upside potential (“Innovations”), may differ significantly from those that would be used if we carried these investments at fair value.
			●			Our level of debt may have an adverse impact on our liquidity, restrict our current and future operations, particularly our ability to respond to business opportunities, and increase our vulnerability to adverse economic and industry conditions.
			●			Greenlight Capital Re, Greenlight Reinsurance Ltd. (“Greenlight Re”), and/or Greenlight Reinsurance Ireland, Designated Activity Company (“GRIL”) may be subject to United States federal income taxation.
			●			The other matters set forth in the section entitled “Part I, Item 1A. Risk Factors” contained in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, as filed with the SEC on March 8, 2023 (“2022 Form 10-K”).

We undertake no obligation to publicly update or revise any forward-looking statements, whether due to new information, future events, or otherwise. Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only to the dates they were made.

We intend to communicate certain events that we believe may have a material adverse impact on our operations or financial position, including property and casualty catastrophic events and material losses in our investment portfolio, in a timely manner through a public announcement. Other than as required by the Exchange Act, we do not intend to make public announcements regarding ~~reinsurance~~underwriting or investment events that we do not believe, based on management’s estimates and current information, will have a material adverse impact on our operations or financial position.

~~Return to table of contents~~

Item 1. FINANCIAL STATEMENTS

GREENLIGHT CAPITAL RE, LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

~~(UNAUDITED)~~

~~September 30, 2023~~March 31, 2024 (unaudited) and December 31, ~~2022~~2023

(expressed in thousands of U.S. dollars, except per share and share amounts)


		September 30, 2023		December 31, 2022			March 31, 2024	December 31, 2023
Assets	Assets					Assets
Investments	Investments					Investments
Investment in related party investment fund		$	228,991	$	178,197
Investment in related party investment fund, at fair value
Other investments	Other investments	67,648		70,279
Total investments	Total investments	296,639		248,476
Cash and cash equivalents	Cash and cash equivalents	41,302		38,238
Restricted cash and cash equivalents	Restricted cash and cash equivalents	622,624		668,310
Reinsurance balances receivable (net of allowance for expected credit losses of 2023: $801 and 2022: $356)		640,391		505,555
Loss and loss adjustment expenses recoverable (net of allowance for expected credit losses of 2023: $117 and 2022: $62)		28,191		13,239
Reinsurance balances receivable (net of allowance for expected credit losses of 2024: $865 and 2023: $854)
Loss and loss adjustment expenses recoverable (net of allowance for expected credit losses of 2024: $701 and 2023: $487)
Deferred acquisition costs	Deferred acquisition costs	85,102		82,391
Unearned premiums ceded	Unearned premiums ceded	18,700		18,153
Other assets	Other assets	6,680		6,019
Total assets	Total assets	$	1,739,629	$	1,580,381
Liabilities and equity	Liabilities and equity
Liabilities	Liabilities
Liabilities
Liabilities
Loss and loss adjustment expense reserves
Loss and loss adjustment expense reserves
Loss and loss adjustment expense reserves	Loss and loss adjustment expense reserves	$	658,234	$	555,468
Unearned premium reserves	Unearned premium reserves	340,582		307,820
Reinsurance balances payable	Reinsurance balances payable	69,882		105,135
Funds withheld	Funds withheld	13,406		21,907
Other liabilities	Other liabilities	6,781		6,397
Debt	Debt	74,879		80,534
Total liabilities	Total liabilities	1,163,764		1,077,261
Commitments and Contingencies (Note 11)
Commitments and Contingencies (Note 15)						Commitments and Contingencies (Note 15)
Shareholders' equity	Shareholders' equity
Preferred share capital (par value $0.10; authorized, 50,000,000; none issued)		—		—
Ordinary share capital (par value $0.10; authorized, 125,000,000; issued and outstanding, 35,337,407 (2022: Class A: par value $0.10; authorized, 100,000,000; issued and outstanding, 28,569,346: Class B: 2022: par value $0.10; authorized, 25,000,000; issued and outstanding, 6,254,715)		3,534		3,482
Preferred share capital (par value $0.10; none issued)
Preferred share capital (par value $0.10; none issued)
Preferred share capital (par value $0.10; none issued)
Ordinary share capital (par value $0.10; issued and outstanding, 35,321,144 (2023: par value $0.10; issued and outstanding, 35,336,732)
Additional paid-in capital	Additional paid-in capital	481,908		478,439
Retained earnings	Retained earnings	90,423		21,199
Total shareholders' equity	Total shareholders' equity	575,865		503,120
Total liabilities and equity	Total liabilities and equity	$	1,739,629	$	1,580,381

The accompanying Notes to the Condensed Consolidated Financial Statements are an

integral part of the Condensed Consolidated Financial Statements.

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GREENLIGHT CAPITAL RE, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(UNAUDITED)

For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~

(expressed in thousands of U.S. dollars, except per share and share amounts)


		Three months ended September 30				Nine months ended September 30
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
		2023		2022		2023		2022			2024	2023
Revenues	Revenues									Revenues
Gross premiums written	Gross premiums written	$	183,074	$	155,146	$	524,472	$	435,812
Gross premiums ceded	Gross premiums ceded	(14,789)		(8,801)		(35,740)		(21,973)
Net premiums written	Net premiums written	168,285		146,345		488,732		413,839
Change in net unearned premium reserves	Change in net unearned premium reserves	(5,175)		(24,397)		(43,030)		(55,747)
Net premiums earned	Net premiums earned	163,110		121,948		445,702		358,092
Income (loss) from investment in related party investment fund (net of related party expenses - Note 3)	Income (loss) from investment in related party investment fund (net of related party expenses - Note 3)	(1,853)		8,521		27,791		24,474
Net investment income (loss)		6,958		3,038		24,705		11,978
Other income (expense), net		(1,293)		(6,784)		13,399		(13,374)
Net investment income
Foreign exchange gains (losses)
Other income, net
Total revenues	Total revenues	166,922		126,723		511,597		381,170
Expenses	Expenses
Net loss and loss adjustment expenses incurred
Net loss and loss adjustment expenses incurred
Net loss and loss adjustment expenses incurred	Net loss and loss adjustment expenses incurred	96,843		94,559		284,072		252,789
Acquisition costs	Acquisition costs	46,933		36,821		126,702		106,101
General and administrative expenses	General and administrative expenses	7,905		7,389		27,866		22,727
Deposit interest expense	Deposit interest expense	278		6,148		645		6,373
Interest expense	Interest expense	1,457		1,091		2,977		3,411
Total expenses	Total expenses	153,416		146,008		442,262		391,401
Income (loss) before income tax		13,506		(19,285)		69,335		(10,231)
Income tax (expense) benefit		(29)		816		(111)		823
Net income (loss)		$	13,477	$	(18,469)	$	69,224	$	(9,408)
Earnings (loss) per share (Note 2)
Income before income tax
Income tax expense
Net income

Earnings (loss) per share ("EPS"):
Earnings (loss) per share ("EPS"):
Earnings (loss) per share ("EPS"):
Basic
Basic
Basic	Basic	$	0.40	$	(0.56)	$	2.03	$	(0.28)
Diluted	Diluted	$	0.39	$	(0.56)	$	1.99	$	(0.28)
Weighted average number of ordinary shares used in the determination of earnings and loss per share (Note 2)
Weighted average number of ordinary shares used in the determination of EPS:
Basic
Basic
Basic	Basic	34,070,818		33,127,384		34,067,012		33,119,814
Diluted	Diluted	34,801,864		33,127,384		34,703,973		33,119,814

The accompanying Notes to the Condensed Consolidated Financial Statements are an

integral part of the Condensed Consolidated Financial Statements.

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GREENLIGHT CAPITAL RE, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY

(UNAUDITED)

For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~

(expressed in thousands of U.S. dollars)


		Three months ended September 30					Nine months ended September 30
		2023		2022			2023		2022
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
						2024					2024	2023
Ordinary share capital	Ordinary share capital
Balance - beginning of period	Balance - beginning of period	$	3,527	$	3,472		$	3,482	$	3,384
Issue of ordinary shares, net of forfeitures (Note 8)		7		11			52		99
Repurchase of ordinary shares (Note 8)		—		(1)			—		(1)
Balance - beginning of period
Balance - beginning of period
Issue of ordinary shares, net of forfeitures

Balance - end of period
Balance - end of period
Balance - end of period	Balance - end of period	3,534		3,482			3,534		3,482
Additional paid-in capital	Additional paid-in capital
Balance - beginning of period	Balance - beginning of period	480,648		475,903			478,439		481,784
Cumulative effect of adoption of accounting guidance for convertible debt at January 1, 2022		—		—			—		(7,896)
Repurchase of ordinary shares (Note 8)		—		(34)			—		(34)
Balance - beginning of period
Balance - beginning of period

Share-based compensation expense
Share-based compensation expense
Share-based compensation expense	Share-based compensation expense	1,260		1,152			3,469		3,167
Balance - end of period	Balance - end of period	481,908		477,021			481,908		477,021
Retained earnings (deficit)
Retained earnings
Balance - beginning of period	Balance - beginning of period	76,946		4,918			21,199		(9,505)
Cumulative effect of adoption of accounting guidance for convertible debt at January 1, 2022		—		—			—		5,362
Net income (loss)		13,477		(18,469)			69,224		(9,408)
Balance - beginning of period
Balance - beginning of period
Net income
Balance - end of period	Balance - end of period	90,423		(13,551)			90,423		(13,551)
Total shareholders' equity	Total shareholders' equity	$	575,865	$	466,952		$	575,865	$	466,952

The accompanying Notes to the Condensed Consolidated Financial Statements are an

integral part of the Condensed Consolidated Financial Statements.

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GREENLIGHT CAPITAL RE, LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(UNAUDITED)

For the ~~nine~~three months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022~~

(expressed in thousands of U.S. dollars)


		Nine months ended September 30
	Three months ended March 31								Three months ended March 31
		2023		2022			2024	2023
Cash flows from operating activities	Cash flows from operating activities					Cash flows from operating activities
Net income (loss)		$	69,224	$	(9,408)
Net income
Adjustments to reconcile net income or loss to net cash provided by (used in) operating activities:	Adjustments to reconcile net income or loss to net cash provided by (used in) operating activities:
Loss (income) from investments in related party investment fund		(27,791)		(24,474)
Income from investments in related party investment fund
Income from investments in related party investment fund
Income from investments in related party investment fund
Net realized gain on repurchase of convertible senior notes payable	Net realized gain on repurchase of convertible senior notes payable	(265)		(149)
Net change in unrealized gains and losses on investments and derivatives		1,359		(9,237)
Net realized (gains) losses on investments		800		—
Foreign exchange (gains) losses		(7,635)		10,364
Current expected credit losses recognized on reinsurance assets		500		—
Net realized and unrealized losses (gains) on other investments
Net realized and unrealized losses (gains) on derivatives
Current expected credit losses (gains) recognized on reinsurance assets
Share-based compensation expense	Share-based compensation expense	3,521		3,266
Accretion of debt offering costs and change in interest accruals	Accretion of debt offering costs and change in interest accruals	(98)		(612)

Net change in:	Net change in:
Accrued interest receivable		(123)		—
Net change in:
Net change in:
Reinsurance balances receivable
Reinsurance balances receivable
Reinsurance balances receivable	Reinsurance balances receivable	(135,796)		(97,651)
Loss and loss adjustment expenses recoverable	Loss and loss adjustment expenses recoverable	(15,007)		496
Deferred acquisition costs	Deferred acquisition costs	(6,127)		(15,810)
Unearned premiums ceded	Unearned premiums ceded	(547)		(13,617)
Other assets, excluding depreciation		(546)		(540)
Loss and loss adjustment expense reserves	Loss and loss adjustment expense reserves	103,678		36,394
Unearned premium reserves	Unearned premium reserves	43,593		70,589
Reinsurance balances payable	Reinsurance balances payable	(35,253)		17,548
Funds withheld	Funds withheld	(8,501)		7,654
Other liabilities		384		(2,237)
Other items, net
Net cash provided by (used in) operating activities	Net cash provided by (used in) operating activities	(14,630)		(27,424)
Cash flows from investing activities	Cash flows from investing activities
Proceeds from redemptions from related party investment fund		73,997		77,993
Contributions to related party investment fund		(97,000)		(65,127)
Purchases of investments		(5,545)		(8,627)
Proceeds from maturity of term deposit		6,000		—
Proceeds from redemptions of investment in SILP
Proceeds from redemptions of investment in SILP
Proceeds from redemptions of investment in SILP
Contributions to investment in SILP
Purchases of other investments
Proceeds on disposal of other investments

Net cash provided by (used in) investing activities	Net cash provided by (used in) investing activities	(22,548)		4,239
Net cash provided by (used in) investing activities
Net cash provided by (used in) investing activities
Cash flows from financing activities	Cash flows from financing activities
Proceeds from term loans, net of expenses		74,053		—
Repayment of convertible senior notes payable		(62,147)		—

Repayment of term loans

Repayment of term loans

Repayment of term loans

Repurchases of convertible senior notes payable
Repurchases of convertible senior notes payable
Repurchases of convertible senior notes payable	Repurchases of convertible senior notes payable	(17,198)		(6,384)

Repurchase of Class A ordinary shares		—		(35)
Net cash provided by (used in) financing activities		(5,292)		(6,419)

Net cash used in financing activities

Net cash used in financing activities

Net cash used in financing activities
Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	Effect of foreign exchange rate changes on cash, cash equivalents and restricted cash	(152)		(322)
Net increase (decrease) in cash, cash equivalents and restricted cash		(42,622)		(29,926)
Decrease in cash, cash equivalents and restricted cash
Cash, cash equivalents and restricted cash at beginning of the period	Cash, cash equivalents and restricted cash at beginning of the period	706,548		711,101
Cash, cash equivalents and restricted cash at end of the period	Cash, cash equivalents and restricted cash at end of the period	$	663,926	$	681,175
Supplementary information	Supplementary information
Interest paid in cash	Interest paid in cash	$	3,336	$	4,023
Income tax paid in cash		$	56	$	—
Interest paid in cash
Interest paid in cash
Income tax paid (refund received) in cash

The accompanying Notes to the Condensed Consolidated Financial Statements are an

integral part of the Condensed Consolidated Financial Statements.

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GREENLIGHT CAPITAL RE, LTD.

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)

~~September 30, 2023~~March 31, 2024

1. ORGANIZATION AND BASIS OF PRESENTATION

Organization

Greenlight Capital Re, Ltd. (“GLRE” and, together with its wholly-owned subsidiaries, the “Company”) was incorporated as an exempted company under the Companies Law of the Cayman Islands on July 13, 2004. The ~~Company’s wholly-owned subsidiaries are described below:~~

•~~Greenlight Reinsurance, Ltd. (“Greenlight Re”), domiciled~~Company is a global specialty property and casualty reinsurer headquartered in the Cayman Islands, is a Class D insurer license issued in accordance with the terms of The Insurance Act, 2010 (as amended) and underlying regulations thereto (the “Act”) and is subject to regulation by the Cayman Islands Monetary Authority. Greenlight Re commenced underwriting in April 2006.

•Greenlight Reinsurance Ireland, Designated Activity Company (“GRIL”), domiciled in Ireland since 2010, is authorized as a non-life reinsurance undertaking in accordance with the provisions of the European Union (Insurance and Reinsurance) Regulations 2015. GRIL provides multi-line property and casualty reinsurance capacity to the European broker market and provides GLRE with an additional platform to serve clients located in Europe and North America.

• ~~Greenlight Re Marketing (UK) Limited, domiciled in the United Kingdom (“U.K.”) since 2020, is a U.K. company formed to expand GLRE’s presence in the Lloyd’s of London market (“Lloyd’s”).~~

•Greenlight Re Corporate Member Ltd., domiciled in the U.K. since 2014, is a corporate member that became a wholly-owned subsidiary of GLRE in 2023 and provides underwriting capacity for various Lloyd’s syndicates, including Syndicate 3456.

•~~Verdant Holding Company, Ltd., domiciled in the United States since 2008, is an investment holding company.~~

Additionally, through Greenlight Innovation Syndicate 3456 (“Syndicate 3456”), Greenlight Re provides a (re)insurance platform to its growing portfolio of insurtech partnerships. Domiciled in the U.K. since 2022, Syndicate 3456 is authorized to underwrite under the Lloyd’s syndicate-in-a-box model.

Islands. The ordinary shares of GLRE are listed on Nasdaq Global Select Market under the symbol “GLRE.”

Basis of Presentation

These unaudited condensed consolidated financial statements (the “financial statements”) have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) for interim financial information, and with the U.S. Securities and Exchange Commission’s (“SEC”) instructions to Quarterly Report on Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all the information and footnotes required by U.S. GAAP for complete financial statements. ~~These unaudited condensed consolidated~~The financial statements should be read in conjunction with the Company’s audited consolidated financial statements included in the Company’s ~~2022~~2023 Form ~~10-K, as filed with~~10-K. The financial statements include the ~~SEC on March 8, 2023. These unaudited condensed~~accounts of GLRE and the consolidated financial statements ~~include GLRE and~~of its wholly-owned subsidiaries and all significant intercompany transactions and balances have been eliminated on consolidation.

In the opinion of management, these ~~unaudited condensed consolidated~~ financial statements reflect all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the Company’s financial position and results of operations as at the end of and for the periods presented. The results of operations for any interim period are not necessarily indicative of the results for a full year.

Tabular dollars are in thousands, with the exception of per share amounts or otherwise noted. All amounts are reported in U.S. dollars.

Reclassifications

Certain amounts in the prior period financial statements have been reclassified to conform to the presentation of the current financial statements. The Company has reported separately the foreign exchange gains (losses) from “Other income” in the condensed consolidated statements of operations. This resulted in no change to the previously reported total revenues or net income. The Company has also included the foreign exchange gains (losses) as part of the net change in working capital in the condensed consolidated statements of cash flows. Further, the Company combined “Other assets, excluding depreciation” and “Other liabilities” and presented the sum as “Other items, net” in the condensed consolidated statements of cash flows. These changes in presentation in the condensed consolidated statements of cash flows have resulted in no change to the previously reported net cash provided by (used in) operating activities.

2. SIGNIFICANT ACCOUNTING POLICIES

There have been no material changes to the Company’s significant accounting policies as described in its ~~2022~~2023 Form 10-K.

Recently Issued Accounting Standards Not Yet Adopted

On November 27, 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures. The new ASU requires incremental disclosures related to a public entity’s reportable segments but does not change the definition of a segment, the method for determining segments, or the criteria for aggregating operating segments into reportable segments. This new guidance is effective for the Company’s 2024 year-end financial statements, and should be adopted retrospectively unless impracticable. Early adoption is permitted.

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On December 14, 2023, FASB issued ASU 2023-09,

~~Use of Estimates~~

Income Taxes Topic (740) - Improvements to Income Tax Disclosures. The ~~preparation of condensed consolidated financial statements in conformity with U.S. GAAP requires management~~new ASU provides more transparency about income tax information through improvements to ~~make estimates~~income tax disclosures primarily related to the rate reconciliation and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the period. Actual results could differ from these estimates.income taxes paid information. Early adoption is permitted. The ~~significant estimates reflected in~~amendments should be applied on a prospective basis; however, retrospective application is permitted. This ASU is effective for the Company’s ~~condensed consolidated~~2024 year-end financial statements include, but are not limited to, loss and loss adjustment expense reserves, premiums written, earned, and receivable, variability underlying risk transfer assessments, allowances for credit losses, share-based compensation, valuation allowances associated with deferred tax assets and investment impairments.

~~Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents~~

The Company maintains cash and cash equivalent balances to collateralize regulatory trusts and letters of credit issued to cedents (see Note 11). The following table reconciles the cash, cash equivalents, and restricted cash reported within the unaudited condensed consolidated balance sheets to the total presented in the unaudited condensed consolidated statements of cash flows:

September 30, 2023 December 31, 2022
($ in thousands)
Cash and cash equivalents $ 41,302 $ 38,238
Restricted cash and cash equivalents 622,624 668,310
Total cash, cash equivalents and restricted cash presented in the condensed consolidated statements of unaudited cash flows $ 663,926 $ 706,548

~~Funds Held by Cedents~~

The caption “Reinsurance balances receivable” in the Company’s unaudited condensed consolidated balance sheets includes financial assets held by cedents. At September 30, 2023, funds held by cedents were $422.4 million (December 31, 2022: $337.4 million). Such amounts include premiums withheld by Lloyd’s syndicates and funds contributed by the Company to Lloyd's as security for members’ underwriting activities. The Lloyd’s syndicates invest a portion of the premiums withheld in investment funds and fixed-maturity securities. The Company records its share of income (or expense) from these assets, in its unaudited condensed consolidated statements of operations under the caption “Other income (expense)” as reported by the syndicates on a quarterly lag basis due to the timing of the availability of these quarterly financial reports.

~~Deposit Assets and Liabilities~~

At September 30, 2023, deposit assets and liabilities were $3.0 million and $5.2 million, respectively (December 31, 2022: $3.1 million and $10.7 million, respectively). For the three and nine months ended September 30, 2023 and 2022, the interest income (expense) on deposit-accounted contracts were as follows:

Three months ended September 30 Nine months ended September 30
2023 2022 2023 2022
($ in thousands) ($ in thousands)
Deposit interest income $ — $ — $ — $ —
Deposit interest expense $ (278) $ (6,148) $ (645) $ (6,373)
Deposit interest income (expense), net $ (278) $ (6,148) $ (645) $ (6,373)

~~Foreign Exchange~~

For the three and nine months ended September 30, 2023, $(2.0) million and $7.6 million (three and nine months ended September 30, 2022: $(5.0) million and $(10.4) million), respectively, of foreign exchange gains (losses) were included in the Company’s net income in the unaudited condensed consolidated statements of operations under the caption of “Other income (expense), net”.

statements.

~~Return~~As the above ASUs relate solely to ~~table~~financial statement disclosures, the adoption of ~~contents~~

~~Earnings (Loss) Per Share~~

~~The following table reconciles net income (loss) and weighted average shares used in computing basic and diluted net income (loss) per share for~~these ASUs will not impact the ~~three and nine months ended September 30, 2023 and 2022 (expressed in thousands~~Company’s financial condition, results of ~~U.S. dollars, except per share and share amounts):~~

Three months ended September 30 Nine months ended September 30
2023 2022 2023 2022
Numerator for earnings per share
Net income (loss) - basic $ 13,477 $ (18,469) $ 69,224 $ (9,408)
Net income (loss) - diluted $ 13,477 $ (18,469) $ 69,224 $ (9,408)
Denominator for earnings per share
Weighted average shares outstanding - basic 34,070,818 33,127,384 34,067,012 33,119,814
Effect of dilutive employee and director share-based awards 731,046 — 636,961 —
Weighted average shares outstanding - diluted 34,801,864 33,127,384 34,703,973 33,119,814
Anti-dilutive stock options outstanding 652,140 690,337 652,140 690,337
Participating securities excluded from calculation of loss per share — 848,841 — 848,841
Shares potentially issuable in connection with convertible notes excluded from calculation of diluted loss per share — 5,686,747 — 5,773,889
Earnings (loss) per share:
Basic $ 0.40 $ (0.56) $ 2.03 $ (0.28)
Diluted $ 0.39 $ (0.56) $ 1.99 $ (0.28)
operations, or cash flows.

3. INVESTMENT IN RELATED PARTY INVESTMENT FUND

~~The Company~~There has ~~entered into~~been no change to the ~~Second Amended and Restated Exempted Limited Partnership Agreement (the “SILP LPA”) of~~Company’s agreement with Solasglas Investments, LP (“SILP” or “Solasglas”)~~, with DME Advisors II, LLC (“DME II”),~~ as General Partner, Greenlight Re, and GRIL, (together, the “GLRE Limited Partners”). SILP has entered into a SILP investment advisory agreement (“IAA”) with DME Advisors. LP (“DME Advisors”), pursuant to which DME Advisors is the investment manager for SILP. DME II and DME Advisors are related to the Company, and each is an affiliate of David Einhorn, Chairman of the Company’s Board of Directors (the “Chairman”).

At September 30, 2023, the SILP LPA included the following proviso: “The Investment Portfolio of each Partner will not exceed the product of (a) such Partner’s surplus (Greenlight Re Surplus or GRIL Surplus, as the case may be) multiplied by (b) the Investment Cap (60%), and the General Partner will designate any portion of a Partner’s Investment Portfolio as Designated Securities to effectuate such limit.”

~~The Company has concluded that SILP qualifies as a variable interest entity (“VIE”) under U.S. GAAP. In assessing its interest in SILP, the Company noted the following:~~

•DME II serves as SILP’s general partner and has the power to appoint the investment manager. The Company does not have the power to appoint, change or replace the investment manager or the general partner except “for cause.” Neither of the GLRE Limited Partners can participate in the investment decisions of SILP as long as SILP adheres to the investment guidelines provided within the SILP LPA. For these reasons, the GLRE Limited Partners are not considered to have substantive participating rights or kick-out rights.

•DME II holds an interest in excess of 10% of SILP’s net assets, which the Company considers to represent an obligation to absorb losses and a right to receive benefits of SILP that are significant to SILP.

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Consequently, the Company has concluded that DME II’s interests, not the Company’s, meet both the “power” and “benefits” criteria associated with VIE accounting guidance. Therefore DME II is SILP’s primary beneficiary. The Company presents its investment in SILPdescribed in its ~~unaudited condensed consolidated balance sheets in the caption “Investment in related party investment fund.”~~2023 Form 10-K.

The Company’s maximum exposure to loss relating to SILP is limited to ~~the net asset value~~GLRE's share of ~~the GLRE Limited~~ Partners’ ~~investment~~capital in SILP. At ~~September 30, 2023, the net asset value~~March 31, 2024, GLRE'’s share of ~~the GLRE Limited~~ Partners’ ~~investment~~capital in SILP was ~~$229.0~~$307.1 million (December 31, ~~2022: $178.2~~2023: $258.9 million), representing ~~70.3%~~74.2% (December 31, ~~2022: 69.3%~~2023: 72.7%) of SILP’s total net assets. DME II held the remaining ~~29.7%~~25.8% (December 31, ~~2022: 30.7%~~2023: 27.3%) of SILP’s total net assets. The investment in SILP is recorded at the GLRE Limited Partners’ share of the net asset value of SILP as reported by SILP’s third-party administrator. The GLRE Limited Partners can redeem their assets from SILP for operational purposes by providing 3 business days’ notice to DME II. At September 30, 2023, the majority of SILP’s long investments were composed of cash and publicly traded equity securities, which could be readily liquidated to meet the GLRE Limited Partners’ redemption requests.

The Company’s share of the ~~change~~net increase in ~~the net asset value of SILP~~Partner’s capital for the three ~~and nine~~ months ended ~~September 30, 2023~~March 31, 2024 was ~~$(1.9)~~$18.2 million ~~and $27.8 million, respectively~~ (three ~~and nine~~ months ended ~~September 30, 2022: $8.5 million and $24.5 million, respectively)~~March 31, 2023: decrease of $3.1 million), ~~and~~as shown in the caption “Income (loss) from investment in related party investment fund” in the Company’s ~~unaudited~~ condensed consolidated statements of operations.

The summarized financial statements of SILP are presented below.

Summarized ~~Statement~~Statements of ~~Assets and Liabilities~~Financial Condition of Solasglas Investments, LP

September 30, 2023 December 31, 2022
($ in thousands)
Assets
Investments, at fair value $ 423,807 $ 304,806
Derivative contracts, at fair value 25,128 17,547
Due from brokers 59,298 109,169
Cash and cash equivalents — —
Interest and dividends receivable 130 527
Total assets 508,363 432,049
Liabilities and partners’ capital
Liabilities
Investments sold short, at fair value (154,504) (159,382)
Derivative contracts, at fair value (5,232) (12,443)
Capital withdrawals payable (170) (75)
Due to brokers (21,347) (2,050)
Interest and dividends payable (1,008) (760)
Other liabilities (429) (159)
Total liabilities (182,690) (174,869)
Net Assets $ 325,673 $ 257,180
GLRE Limited Partners’ share of Net Assets $ 228,991 $ 178,197


	March 31, 2024		December 31, 2023
Assets
Investments, at fair value	$	446,433	$	453,358
Derivative contracts, at fair value	15,609		11,167
Due from brokers	152,611		121,754
Cash and cash equivalents	881		—
Interest and dividends receivable	224		1,143
Total assets	615,758		587,422

Liabilities and partners’ capital
Liabilities
Investments sold short, at fair value	(190,353)		(197,571)
Derivative contracts, at fair value	(9,896)		(12,917)
Capital withdrawals payable	(390)		(1,000)
Due to brokers	—		(17,398)
Interest and dividends payable	(1,234)		(2,315)
Accrued expenses and other liabilities	(103)		(247)
Total liabilities	(201,976)		(231,448)

Partners' capital	$	413,782	$	355,974

GLRE’s share of Partners' capital	$	307,138	$	258,890

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Summarized ~~Statement~~Statements of Operations of Solasglas Investments, LP


		Three months ended September 30					Nine months ended September 30
		2023		2022			2023		2022
		($ in thousands)
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
						2024					2024	2023
Investment income	Investment income
Dividend income (net of withholding taxes)
Dividend income (net of withholding taxes)
Dividend income (net of withholding taxes)	Dividend income (net of withholding taxes)	$	273	$	305		$	1,624	$	928
Interest income	Interest income	2,523		693			6,415		1,028
Total Investment income	Total Investment income	2,796		998			8,039		1,956

Expenses	Expenses
Expenses
Expenses
Management fee
Management fee
Management fee	Management fee	(1,238)		(901)			(3,469)		(2,686)
Interest	Interest	(2,380)		(464)			(5,387)		(1,199)
Dividends	Dividends	(659)		(356)			(1,871)		(938)
Professional fees and other	Professional fees and other	(507)		(262)			(1,396)		(756)
Total expenses	Total expenses	(4,784)		(1,983)			(12,123)		(5,579)

Net investment income (loss)
Net investment income (loss)
Net investment income (loss)	Net investment income (loss)	(1,988)		(985)			(4,084)		(3,623)

Realized and change in unrealized gains (losses)	Realized and change in unrealized gains (losses)
Realized and change in unrealized gains (losses)
Realized and change in unrealized gains (losses)
Net realized gain (loss)
Net realized gain (loss)
Net realized gain (loss)	Net realized gain (loss)	460		7,221			(2,145)		58,196
Net change in unrealized appreciation (depreciation)	Net change in unrealized appreciation (depreciation)	(1,191)		6,464			52,601		(17,027)
Net gain (loss) on investment transactions	Net gain (loss) on investment transactions	(731)		13,685			50,456		41,169

Net income (loss)		$	(2,719)	$	12,700		$	46,372	$	37,546
Net increase (decrease) in Partners' capital (1)
Net increase (decrease) in Partners' capital (1)
Net increase (decrease) in Partners' capital (1)

GLRE Limited Partners’ share of net income (loss) (1)		$	(1,853)	$	8,521		$	27,791	$	24,474
GLRE’s share of the increase (decrease) in Partners' capital
GLRE’s share of the increase (decrease) in Partners' capital
GLRE’s share of the increase (decrease) in Partners' capital

(1) ~~Net income (loss)~~The net increase in Partners’ capital is net of management fees and performance allocation presented below:


		Three months ended September 30					Nine months ended September 30
		2023		2022			2023		2022
		($ in thousands)
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
						2024					2024	2023
Management fees	Management fees	$	1,238	$	901		$	3,469	$	2,686
Performance allocation	Performance allocation	(206)		$	947		3,088		2,719
Total	Total	$	1,032	$	1,848		$	6,557	$	5,405

~~See Note 10 for further details on related party management fees and performance allocation.~~

4. OTHER INVESTMENTS

At March 31, 2024, the breakdown of the Company’s other investments was as follows:


	Cost		Unrealized gains		Unrealized losses		Accrued interest		Fair value / carrying value
Private investments and unlisted equities	$	26,970	$	49,844	$	(5,237)	$	—	$	71,577
Debt and convertible debt securities	2,499		—		(1,510)		90		1,079

Total other investments	$	29,469	$	49,844	$	(6,747)	$	90	$	72,656

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~~4. FINANCIAL INSTRUMENTS~~

~~Private investments and unlisted equity securities without readily determinable fair values~~

~~At September 30, 2023, the Company included the following private investments and unlisted securities without readily determinable fair values in the caption “Other investments”:~~

Cost Unrealized
gains Unrealized
losses Accrued interest Fair value / carrying value
($ in thousands)
Private investments and unlisted equities $ 26,702 $ 42,942 $ (4,795) $ — $ 64,849
Debt and convertible debt securities 2,676 — — 123 2,799
Total other investments $ 29,378 $ 42,942 $ (4,795) $ 123 $ 67,648

At December 31, ~~2022,~~2023, the ~~Company included~~breakdown of the ~~following private~~Company’s other investments ~~and unlisted securities without readily determinable fair values in the caption “Other investments”:~~was as follows:

Cost Unrealized
gains Unrealized
losses Fair value / carrying value
($ in thousands)
Private investments and unlisted equities $ 22,787 $ 42,461 $ (2,815) $ 62,433
Debt and convertible debt securities 1,846 — — 1,846
Certificates of deposit 6,000 — — 6,000
Total other investments $ 30,633 $ 42,461 $ (2,815) $ 70,279


	Cost		Unrealized gains		Unrealized losses		Accrued interest		Fair value / carrying value
Private investments and unlisted equities	$	28,470	$	49,424	$	(6,737)	$	—	$	71,157
Debt and convertible debt securities	2,499		—		(499)		136		2,136

Total other investments	$	30,969	$	49,424	$	(7,236)	$	136	$	73,293

The following table presents the carrying values of the private investments and unlisted equity securities carried under the measurement alternative at ~~September 30,~~March 31, 2024 and 2023, ~~and 2022,~~ and the related adjustments recorded during the periods then ended.


			Nine months ended September 30
			2023		2022
			($ in thousands)
		Three months ended March 31						Three months ended March 31
		2024					2024		2023
Carrying value (1)	Carrying value (1)		$	64,849	$	61,081
Upward carrying value changes (2)	Upward carrying value changes (2)		$	506	$	11,260
Downward carrying value changes and impairment (3)	Downward carrying value changes and impairment (3)		$	(2,780)	$	(1,676)

(1) The period-end carrying values reflect cumulative purchases and sales in addition to upward and downward carrying value changes.

(2) The cumulative upward carrying value changes from inception to ~~September 30, 2023,~~March 31, 2024, totaled ~~$43.4~~$50.8 million.

(3) The cumulative downward carrying value changes and impairments from inception to ~~September 30, 2023,~~March 31, 2024, totaled ~~$5.9~~$2.8 million.

Net investment income

The following table summarizes the change in unrealized gains (losses) and the realized gains (losses) for the Company’s other investments, which are included in “Net investment income” in the condensed consolidated statements of operations (see Note 13):


	Three months ended March 31
		2024		2023
Gross realized gains		$	—	$	—
Gross realized losses		(1,332)		(800)
Net realized gains (losses)		$	(1,332)	$	(800)
Change in unrealized gains		919		550
Net realized and unrealized gains (losses) on other investments		$	(413)	$	(250)

During the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024, the Company collected $0.2 million of liquidation proceeds relating to a private investment which was previously fully impaired, resulting in a gross realized loss of $1.3 million offset by a corresponding reduction in unrealized losses of $1.5 million.

During the three months ended March 31, 2023, the Company realized a loss of ~~$nil and~~ $0.8 million, ~~respectively, (three and nine months ended September 30, 2022: $nil),~~ and a corresponding reversal of unrealized loss relating to an investment which was previously fully impaired at December 31, 2022, resulting in no impact to the Company’s net income (loss) for the ~~nine months ended September 30, 2023.~~quarter.

~~Fair Value Hierarchy~~

The fair value of a financial instrument is the amount that would be received in an asset sale or paid to transfer a liability in an orderly transaction between unaffiliated market participants. Assets and liabilities measured at fair value are categorized based on the extent to which the inputs are observable in the market. The categorization of financial instruments within the valuation hierarchy is based on the lowest level of input that is significant to the fair value measurement. The hierarchy is prioritized into three levels (with Level 3 being the lowest) defined as follows:

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•

5. RESTRICTED CASH AND CASH EQUIVALENTS

The following table shows the breakdown of the Company’s restricted cash and cash equivalents, along with a reconciliation of the total cash, cash equivalents, and restricted cash reported in the condensed consolidated statements of cash flows:


	March 31, 2024		December 31, 2023
Restricted cash and cash equivalents:
Cash securing trust accounts	$	281,951	$	300,152
Cash securing letters of credit issued	286,381		291,456
Cash securing Loan Facility	10,000		10,000
Other	2,876		3,040
Total restricted cash and cash equivalents	581,208		604,648
Cash and cash equivalents	61,598		51,082
Total cash, cash equivalents, and restricted cash	$	642,806	$	655,730

Where the Company operates as a non-admitted carrier in certain foreign jurisdictions, regulatory trust accounts and letters of credit are issued to cedents. Additionally, the Company has provided cash collateral for the Loan Facility (see Note 9).

6. FAIR VALUE MEASUREMENTS

~~Level 1: Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.~~

•

Level 2: Observable inputs other than prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated with observable market data.

•

Level 3: Unobservable inputs supported by little or no market activity and significant to the fair value of the assets and liabilities. The term “unobservable inputs” includes certain pricing models, discounted cash flow methodologies, and similar techniques.

Assets measured at fair value on a nonrecurring basis

At ~~September 30, 2023~~March 31, 2024 and December 31, ~~2022,~~2023, the Company held ~~$53.7~~$61.7 million and ~~$53.6~~$61.3 million, respectively, of private investments and unlisted equities measured at fair value on a nonrecurring basis. At March 31, 2024, the Company held $9.9 million (2023: $9.9 million) of private investments and unlisted equities measured at cost. The Company classifies these ~~assets~~investments as Level 3 within the fair value hierarchy.

The following table summarizes the periods between the most recent fair value measurement dates and ~~September 30, 2023,~~March 31, 2024, for the private and unlisted equities measured at fair value on a nonrecurring basis:

Less than 6 months 6 to 12 months Over 1 year Total
($ in thousands)
Fair values measured on a nonrecurring basis $ 18,552 $ 602 $ 34,567 $ 53,721

~~At September 30, 2023 and December 31, 2022, the Company held $11.1 million and $8.9 million, respectively, of private investments and unlisted equities measured at cost.~~


	Less than 6 months		6 to 12 months		Over 1 year		Total
Fair values measured on a nonrecurring basis	$	10,433	$	18,552	$	32,724	$	61,709

Assets measured at fair value on a recurring basis

Derivative financial instruments

The Company uses interest rate swaps in connection with its risk management activities to hedge 50% of the interest rate risk relating to the outstanding Term Loans (see Note 7)9). The interest rate swaps are carried at fair value and are determined using a market approach valuation technique based on significant observable market inputs from third-party pricing vendors. Accordingly, the interest rates swaps are classified as Level 2 within the fair value hierarchy. These derivative instruments are not designated as accounting hedges under U.S. GAAP.

For the three ~~and nine~~ months ended ~~September 30, 2023,~~March 31, 2024, the Company recognized a reduction in unrealized ~~gain~~loss for the above derivatives of $0.5 million to $0.1 million, which ~~are~~is included in other ~~assets~~liabilities in the ~~Condensed Consolidated Balance Sheets,~~condensed consolidated balance sheets, in interest expense in the ~~Condensed Consolidated Statements~~condensed consolidated statements of ~~Operations,~~operations, and in ~~net~~“net change in unrealized gains and losses on investments and ~~derivatives~~derivatives” in the ~~Condensed Consolidated Statements~~condensed consolidated statements of ~~Cash Flows.~~cash flows.

~~Investment in Related Party Investment Fund~~

The Company’s investment in the related party investment fund is measured at fair value using the net asset value practical expedient.Therefore, this investment is not classified within the fair value hierarchy. (See Note 3 for further details on the related party investment fund.)

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Financial Instruments Disclosed, But Not Carried, at Fair Value

~~The~~At March 31, 2024, the carrying value of debt and convertible debt securities within “Other Investments” (see ~~“Private investments~~Note 4) and ~~unlisted equity securities without readily determinable fair values” above) and certificates of deposit with original maturities of one year or less~~the Term Loans approximates their fair values. The Company classifies these ~~assets~~financial instruments as Level 2 within the fair value hierarchy.

~~The Term Loans (see Note 7) represent financial instruments that the Company carries at amortized cost. At September 30, 2023, the carrying values of the Term Loans approximate their fair values.~~

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5.7. LOSS AND LOSS ADJUSTMENT EXPENSE RESERVES

~~At September 30, 2023 and December 31, 2022,~~The Company’s loss and loss adjustment expense (“LAE”) reserves were composed of the following:


			September 30, 2023		December 31, 2022
			($ in thousands)
		March 31, 2024					March 31, 2024	December 31, 2023
Case reserves	Case reserves		$	190,121	$	184,756
IBNR	IBNR		468,113		370,712
Total	Total		$	658,234	$	555,468

AReserve Roll-forward

The following provides a summary of changes in outstanding loss and ~~loss adjustment expense~~LAE reserves for all lines of ~~business consolidated for the nine months ended September 30, 2023 and 2022 is as follows:~~ business:


Consolidated	Consolidated		2023		2022		Consolidated	Three months ended March 31
			($ in thousands)
		2024							2024	2023
Gross balance at January 1	Gross balance at January 1		$	555,468	$	524,010
Less: Losses recoverable	Less: Losses recoverable		(13,239)		(11,100)
Net balance at January 1	Net balance at January 1		542,229		512,910
Incurred losses related to:	Incurred losses related to:						Incurred losses related to:
Current year	Current year		273,570		251,231
Prior years	Prior years		10,502		1,558
Total incurred	Total incurred		284,072		252,789
Paid losses related to:	Paid losses related to:						Paid losses related to:
Current year	Current year		(41,026)		(54,866)
Prior years	Prior years		(154,374)		(160,094)
Total paid	Total paid		(195,400)		(214,960)
Foreign currency revaluation	Foreign currency revaluation		(858)		(20,516)
Net balance at September 30			630,043		530,223
Add: Losses recoverable			28,191		10,604
Gross balance at September 30			$	658,234	$	540,827
Net balance at March 31
Add: Losses recoverable (see Note 8)
Gross balance at March 31

Estimates for Significant Catastrophe Events

At ~~September 30, 2023,~~March 31, 2024, the Company’s net reserves for losses and loss expenses include estimated amounts for several catastrophe and weather-related events (“CAT loss”). The magnitude and volume of losses arising from these events is inherently uncertain and, consequently, actual losses for these events may ultimately differ, potentially materially, from current estimates.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2024, the Company recognized CAT loss, net of reinsurance, of $12.4 million for current year CAT loss events, driven mainly by the Baltimore bridge collapse and satellite failures. Additionally, the Company incurred $4.9 million of net adverse prior year CAT loss development relating primarily to a Mexican state-owned oil platform fire (2023 underwriting year), Hurricane Otis (2023 underwriting year) and homeowners’ property (mostly 2022 underwriting year).

During the three months ended March 31, 2023, the Company recognized CAT loss, net of reinsurance, of ~~$29.5~~$6.2 million for current year CAT loss events, driven mainly by the Turkey earthquake, the New Zealand Cyclone Gabrielle ~~in New Zealand,~~and the U.S. severe storms, Mexican state-owned oil platform fire, and satellite losses. For the nine months ended September 30, 2022, the Company recognized CAT loss of $39.1 million driven by $13.6 million from the Russian-Ukrainian conflict and $19.5 million from hurricane Ian.

~~Prior Year Reserve Development~~

~~For the nine months ended September 30, 2023, the estimate of net losses incurred relating to prior accident years increased by $10.5 million, primarily due to the following:~~

•$31.3 million adverse loss development primarily due to reserve strengthening on legacy motor (predominantly 2021 underwriting year), homeowners (primarily deterioration relating to Winter Storm Elliott in December 2022), and workers’ compensation (2021 and prior underwriting years) contracts, coupled with a final claim settlement on a professional liability contract (2008 underwriting year).

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convective storms that occurred during the quarter, coupled with adverse prior year CAT development of $4.1 million relating to the 2022 Winter Storm Elliott.

•

Prior Year Reserve Development

During the three months ended March 31, 2024, the Company experienced $5.4 million in net adverse development on prior year loss and LAE reserves. This was comprised of $10.5 million of reserve strengthening predominantly for the above prior year CAT loss events, coupled with additional losses reported on general liability contracts (mostly 2015-2017 underwriting years) due to current economic and social inflation trends. The ~~adverse~~reserve increases were partially offset by $5.1 million favorable loss development predominantly from FAL and other specialty business (2022 and 2023 underwriting years).

During the three months ended March 31, 2023, the Company experienced $12.0 million in net adverse development on prior year loss and LAE reserves. This was comprised of $13.9 million of reserve strengthening on casualty contracts due to current economic and social inflation trends (mostly 2019 and 2021 underwriting years), as well as on homeowners’ business primary due to the deterioration in the CAT loss estimate relating to Winter Storm Elliott (2022 underwriting year). This was partially offset by ~~$20.8~~$1.9 million ~~favorable loss development from various prior years’ property catastrophe events and~~ better than expected loss emergence for ~~marine and energy (predominantly 2020~~other lines of business (mostly 2021 and 2022 underwriting years)~~, group medical (2022 and prior underwriting years) and cyber contracts (predominantly 2021 underwriting year)~~.

~~For the nine months ended September 30, 2022, the estimate of net losses incurred relating to prior accident years increased by $1.6 million, primarily due to the following:~~

• $16.3 million reserve strengthening on motor and health business (2021-2021 underwriting years); a multi-line quota share program (2015, 2016-2019 underwriting years); marine and energy contracts (2020 underwriting year); and a cyber contract (2020 underwriting year).

•Offsetting the above adverse loss development, the Company had favorable loss experience driven mostly by mortgage business (2018 underwriting year), excess of loss workers’ compensation contract (2020 underwriting year) as well as favorable CAT loss development relating to small catastrophe events (mainly 2020 and 2021 underwriting years) and COVID-19 (2020 underwriting year) based on updated claims reporting received from cedents.

6.8. RETROCESSION

~~For~~From time to time, the ~~three~~Company purchases retrocessional coverage for one or more of the following reasons: to manage its overall exposure, reduce its net liability on individual risks, obtain additional underwriting capacity, and nine months ended September 30, 2023, the Company’s earned ceded premiums were $15.3 million and $35.2 million, respectively (three and nine months ended September 30, 2022: $4.4 million and $8.4 million, respectively). For the three and nine months ended September 30, 2023,balance its underwriting portfolio. The Company records loss and loss adjustment expenses ~~recovered and changes in losses~~ recoverable ~~were $9.1 million and $24.8 million, respectively (three and nine months ended September 30, 2022: $2.5 million and $2.5 million, respectively).~~from retrocessionaires as assets.

The following table provides a breakdown of ceded reinsurance:


	Three months ended March 31
	2024		2023
Gross ceded premiums	$	23,181	$	11,212
Earned ceded premiums	$	15,242	$	8,581
Loss and loss adjustment expenses ceded	$	23,076	$	6,171

Retrocession contracts do not relieve the Company from its obligations to its cedents. Failure of retrocessionaires to honor their obligations could result in losses to the Company. The following table shows a breakdown of losses recoverable on a gross and net of collateral basis:


	March 31, 2024				December 31, 2023
	Gross		Net of Collateral(1)		Gross		Net of Collateral(1)
A- or better by A.M. Best	$	28,232	$	28,232	$	8,767	$	8,767
Not rated	17,234		762		17,407		2,432
Total before provision	45,466		$	28,994	$	26,174	$	11,199
Provision for credit losses	(701)				(487)
Total loss and loss adjustment expenses recoverable, net	$	44,765			$	25,687

(1) Collateral is in the form of cash, letters of credit, funds withheld, and/or cash collateral held in trust accounts. This excludes any excess collateral in order to disclose the aggregate net exposure for each retrocessionaire.

At ~~September 30, 2023, the Company’s loss reserves recoverable consisted of (i) $20.2 million~~March 31, 2024, we had 2 reinsurers (December 31, ~~2022: $9.5 million)~~2023: 3) that accounted for 10% or more of the total loss and loss adjustment expenses recoverable, ~~from unrated retrocessionaires,~~net, for an aggregate gross amount of ~~which~~ $14.7 million (December 31, 2022: $9.2 million) were secured by cash, letters of credit and collateral held in trust accounts for the benefit of the Company and (ii) $8.1 million (December 31, 2022: $3.8 million) recoverable from retrocessionaires rated A- or above by A.M. Best.

The Company regularly evaluates its net credit exposure to assess the ability of the retrocessionaires to honor their respective obligations. At September 30, 2023, the Company’s allowance for expected credit losses was $0.1 million (December 31, 2022: $0.12023: $20.4 million).

~~7. DEBT~~

~~The following table summarizes the Company’s debt.~~

September 30, 2023 December 31, 2022
($ in thousands)
Term loans $ 75,000 $ —
Senior convertible notes — 79,610
Total principal amount $ 75,000 $ 79,610
Accrued interest payable 700 1,331
Less: deferred finance costs (821) (407)
Total debt $ 74,879 $ 80,534

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~~Term Loans~~9. DEBT AND CREDIT FACILITIES

On June 16, 2023, the Company entered into a Credit Agreement (the “Credit Agreement”) with a group of banks (the “Banks”), for which CIBC Bank USA is acting as administrative agent (the “Administrative Agent”). The Credit Agreement provides, subject to certain customary conditions, for a delayed draw term loan facility (the “Facility”), in an aggregate amount of $75.0 million. Outstanding loans (“Term Loans”) under the Facility will (i) amortize in equal quarterly installments in an aggregate annual amount equal to 5.0% of the outstanding loans and (ii) accrue interest at a rate equal to an adjusted Term Secured Overnight Financing Rate (“SOFR”) plus 3.5% per annum. The Company posted $10.0 million of collateral as security for the Facility. The Facility matures on August 1, 2026.

During the three and nine months ended September 30, 2023, the Company borrowed $75.0 million from the Facility, of which $63.4 million was used to repay all of the outstanding Convertible Senior Notes (see below), with the remaining proceeds for general corporate purposes. On August 31, 2023, the Company hedged 50% of the floating interest rate on the Term Loans (see Note 4). The interest rate on the outstanding Terms Loans was 8.9% at September 30, 2023.Debt Obligations

The following table summarizes the Company’s outstanding debt obligations.


	March 31, 2024		December 31, 2023
Term loans	$	73,125	$	74,062
Accrued interest payable	47		—
Less: deferred financing costs	(706)		(781)
Total debt	$	72,466	$	73,281

Credit Facilities

At March 31, 2024, the Company had the following letter of credit (“LOC”) facilities:


	Capacity		LOCs issued		Termination Date
Citibank Europe plc ("Citi LOC")1	$	289,000	$	247,174	August 20, 2024
CIBC Bank USA ("CIBC LOC")	200,000		39,163		December 21, 2024
	$	489,000	$	286,337

1) Includes $14 million of uncommitted capacity.

The above LOCs issued are cash collateralized (see Note 5). The LOC facilities are subject to various customary affirmative, negative and financial covenants. At March 31, 2024, the Company was in compliance with all ~~covenants relating to the Facility at September 30, 2023.~~

~~Senior Convertible Notes~~

LOC facilities covenants.

On ~~August 7, 2018,~~April 12, 2024, the Company ~~issued $100.0~~received written notice from Citibank Europe plc (“Citi”) of its decision to terminate the $275 million ~~of senior unsecured convertible notes (the “Convertible Notes”),~~committed capacity under the Citi LOC agreement, with ~~a maturity~~an effective date of August 1, 2023. The Convertible Notes bear interest at 4.0%, payable semiannually on February 1 and August 1 of each year beginning February 1, 2019. The conversion price was $17.19 per ordinary share of the Company.

~~As noted above,~~20, 2024. However, Citi informed the Company ~~fully repaid~~that it intends to continue providing the ~~remaining outstanding Convertible Notes~~Citi LOC on ~~August 1, 2023, from the proceeds of the new Term Loans.~~

During the three and nine months ended September 30, 2023 the Company repurchased and canceled $nil and $17.2 million of the Convertible Notes, respectively, resulting in realized gains of $nil and $0.3 million, respectively, which is included in “Other income (expense), net”, in the unaudited condensed consolidated statements of operations. As noted above, the Company fully repaid the remaining outstanding Convertible Notes on August 1, 2023, from the proceeds of the new Term Loans.

~~Financing Costs~~

The Company incurred $0.9 million of issuance costs relating to the Credit Agreement, which are deferred and amortized through the maturity of the Facility. The remaining unamortized deferred finance costs are reported separately in the above table.

For the three and nine months ended September 30, 2023, the Company recognized interest expense of $1.6 million and $3.1 million, respectively (three and nine months ended September 30, 2022: $1.1 million and $3.4 million, respectively)an uncommitted basis for the ~~above total debt, which included~~foreseeable future following the ~~interest coupon, the amortization of issuance costs and the change in fair value of the interest rate swap (see Note 4).~~

termination date.

8.10. SHARE CAPITAL

Ordinary Shares

The following table is a summary of ~~the Company’s~~changes in ordinary shares issued and ~~outstanding:~~outstanding for the three months ended March 31:


		Nine months ended September 30			Nine months ended September 30
		2023			2022
		Ordinary	Class A	Class B	Class A	Class B


							2024		2023
	Ordinary							Ordinary		Ordinary	Class A	Class B
Balance – beginning of period	Balance – beginning of period	—	28,569,346	6,254,715	27,589,731	6,254,715
Issue of shares, net of forfeitures	Issue of shares, net of forfeitures	65,394	447,952	—	984,548	—
Repurchase of shares		—	—	—	(4,933)	—
Re-designate Class B to Class A shares		—	6,254,715	(6,254,715)	—	—
Reclassify Class A to Ordinary shares		35,272,013	(35,272,013)	—	—	—

Balance – end of period	Balance – end of period	35,337,407	—	—	28,569,346	6,254,715

Balance – end of period

Balance – end of period

~~Return to table~~The Company’s authorized share capital is 125,000,000 ordinary shares, par value of ~~contents~~

On May 2, 2023, the Board of Directors re-approved the share repurchase plan effective from July 1, 2023 until June 30, 2024, authorizing the Company to repurchase up to $25.0 million of Ordinary shares or securities convertible into Ordinary shares in the open market, through privately negotiated transactions or Rule 10b5-1 stock trading plans. Any shares repurchased are canceled immediately upon repurchase.$0.10 per share.

On July 25, 2023, at the Company’s Annual General Meeting the shareholders approved the re-designation of Class B ordinary shares as Class A ordinary shares, and then reclassified Class A ordinary shares as ~~“Ordinary shares,”~~“ordinary shares”, resulting in the elimination of the dual-class share structure.

At March 31, 2024, the Company has an effective Form S-3 registration statement on file with the SEC for an aggregate principal amount of $200.0 million in securities.

Share Repurchase Plan

On May 3, 2024, the Board of Directors re-approved the share repurchase plan, until June 30, 2025, authorizing the Company to repurchase up to $25.0 million of ordinary shares or securities convertible into ordinary shares in the open market,

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through privately negotiated transactions or Rule 10b5-1 stock trading plans.Any shares repurchased are canceled immediately upon repurchase. For the three months ended March 31, 2024 and 2023, there was no repurchase of ordinary shares.

Preferred Shares

The Company’s authorized share capital also consists of 50,000,000 preference shares with a par value of $0.10 each. At March 31, 2024, the Company has no issued and outstanding preferred shares.

11. SHARE-BASED COMPENSATION

Refer to Note 11 of the Company’s audited consolidated financial statements of its 2023 Form 10-K for a summary of the Company’s 2023 Incentive Plan, including the definition of performance-based and service-based stock awards.

Employee and Director Restricted Shares

The following table summarizes the activity for unvested outstanding restricted share awards (“RSs”) during the ~~nine~~three months ended ~~September 30, 2023~~March 31, 2024 and ~~2022:~~2023:


			Performance Restricted Shares			Service Restricted Shares
			Number of non-vested restricted shares	Weighted average grant date fair value		Number of non-vested restricted shares	Weighted average grant date fair value
Balance at December 31, 2021			193,149	$	10.10	753,407	$	8.68
Granted			601,213	6.82		356,422	7.02
Vested			—	—		(197,002)	10.06
Forfeited			—	—		(8,476)	7.67
Balance at September 30, 2022			794,362	$	7.62	904,351	$	7.73
		Performance Restricted Shares									Performance Restricted Shares			Service Restricted Shares
									Number of non-vested restricted shares	Weighted average grant date fair value		Number of non-vested restricted shares	Weighted average grant date fair value
Balance at December 31, 2022	Balance at December 31, 2022		794,362	$	7.62	832,896	$	7.76
Granted	Granted		357,766	9.85		242,957	10.22
Vested	Vested		—	—		(364,006)	6.96
Forfeited	Forfeited		(109,105)	9.37		(55,967)	8.43
Balance at September 30, 2023			1,043,023	$	8.20	655,880	$	9.05
Balance at March 31, 2023

Balance at December 31, 2023
Balance at December 31, 2023
Balance at December 31, 2023
Granted
Vested
Forfeited
Balance at March 31, 2024

On July 25, 2023, at the Company’s Annual General Meeting the shareholders approved the Greenlight Capital Re, Ltd. 2023 Omnibus Incentive Plan, or the 2023 Incentive Plan. The 2023 Incentive Plan replaces the Greenlight Capital Re, Ltd. Amended and Restated 2004 Stock Incentive Plan, or the 2004 Stock Incentive Plan, and its subsequent amendments. As a result, the 2004 Stock Incentive Plan share reserve was transferred to the 2023 Incentive Plan and any forfeitures under the 2004 Stock Incentive Plan will become available for grant under the 2023 Incentive Plan. Further, the shareholders approved to increase the maximum number of ordinary shares for which awards may be granted by 2 million ordinary shares. At ~~September 30, 2023, 3,296,771~~March 31, 2024, 2,914,198 (December 31, ~~2022: 2,011,426) Ordinary~~2023: 3,296,771) ordinary shares remained available for future issuance under the Company’s 2023 Incentive Plan. ~~The Compensation Committee of the Board of Directors administers the stock incentive plan.~~

There was no grant of RSs during the three months ended March 31, 2024 (2023: 509,767). For the ~~nine~~three months ended ~~September 30, 2023,~~March 31, 2024, the Company granted 535,329 (nine months ended September 30, 2022: 849,872) restricted shares to employees pursuant to the Company’s stock incentive plan. The restricted shares granted to employees in 2023 and 2022 include (i) restricted shares with both performance and service-based vesting conditions (“Performance RSs”) and (ii) restricted shares with only service-based vesting conditions (“Service RSs”). Thetotal fair value of Service RSs vest evenly each year on January 1, subject to the grantee’s continued service with the Company. If performance goals are achieved, the Performance RSs will cliff vest at the end of a three-year performance period within a range of 25% and 100% of the awarded Performance RSs, with a target of 50%vested was $1.9 million (2023: $1.7 million). ~~During the vesting period, the holder of the Service RSs and Performance RSs retains voting rights but is entitled to any dividends declared by the Company only upon vesting.~~

For the nine months ended September 30, 2023, the Company granted 65,394 (nine months ended September 30, 2022: 107,763) restricted Ordinary shares to non-employees directors as part of their remuneration for services to the Company. These restricted shares contain similar restrictions to those issued to employees. They will vest on the earlier of (i) the first anniversary of the date of the share issuance and (ii) the Company’s next annual general meeting, subject to the grantee’s

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continued service with the Company. During the vesting period, non-employee directors holding these restricted shares retain voting rights and are entitled to any dividends declared by the Company only upon vesting.

~~For the nine months ended September 30, 2023, the total fair value of restricted shares vested was $2.5 million (nine months ended September 30, 2022: $2.0 million).~~

Employee Restricted Stock Units

The following table summarizes the activity for unvested outstanding restricted stock units (“RSUs”) during the ~~nine~~three months ended ~~September 30, 2023~~March 31, 2024 and ~~2022:~~2023:


			Performance Restricted Stock Units			Service Restricted Stock Units
			Number of non-vested RSUs	Weighted average grant date fair value		Number of non-vested RSUs	Weighted average grant date fair value
Balance at December 31, 2021			—	$	—	154,134	$	8.59
Granted			105,008	6.82		54,207	6.82
Vested			—	—		(35,389)	10.84
Forfeited			—	—		—	—
Balance at September 30, 2022			105,008	6.82		172,952	7.58
		Performance									Performance			Service
									Number of non-vested RSUs	Weighted average grant date fair value		Number of non-vested RSUs	Weighted average grant date fair value
Balance at December 31, 2022	Balance at December 31, 2022		105,008	$	6.82	172,952	$	7.58
Granted	Granted		71,121	9.85		42,811	9.85
Vested	Vested		—	—		(77,695)	6.74
Forfeited	Forfeited		—	—		(1,788)	7.82
Balance at September 30, 2023			176,129	$	8.04	136,280	$	8.76
Balance at March 31, 2023

Balance at December 31, 2023
Balance at December 31, 2023
Balance at December 31, 2023
Granted
Vested
Forfeited
Balance at March 31, 2024

For the ~~nine~~awards granted during the three months ended ~~September 30, 2023,~~March 31, 2024, the Company granted 113,932 (nine months ended September 30, 2022: 159,215) RSUs to employees pursuant to the Company’s stock incentive plan. The RSUs include (i) RSUs with both performance and service-based vesting conditions (“Performance RSUs”) and (ii) RSUs with only service-based vesting conditions (“Service RSUs”). The Service RSUs vest evenly ~~each year~~over three years on January 1, subject to the grantee’s continued service with the Company. If performance goals are achieved, the Performance RSUs will cliff vest at the end of a ~~three-year~~three-year performance period within a range of ~~25%~~50% and ~~100%~~200% of the awarded Performance RSUs, with a target of ~~50%~~100%. ~~Prior to 2022, the RSUs issued to employees cliff vested three years after the date of issuance, subject to the grantee’s continued service with the Company.~~

For the ~~nine~~three months ended ~~September 30, 2023,~~March 31, 2024, the ~~Company issued 77,695~~total fair value of Service RSUs vested was $0.7 million (2023: $0.5 million).

Employee and Director Stock Options

During the three months ended March 31, 2024, 250,000 ordinary ~~shares for~~share purchase options were granted to the ~~vested RSUs.~~Company’s CEO, pursuant to his employment contract. These options vest 50,000 annually and expire in 10 years from the grant date. The grant date fair value of these options was $4.31 per share, based on the Black-Scholes option pricing model. The following inputs were used in this pricing model:



Expected volatility	36.4		%
Expected term (in years)	5
Expected dividend yield	—		%
Risk-free interest rate	3.9		%
Stock price at grant date	$	11.20

Stock Compensation Expense

For the ~~nine~~three months ended ~~September 30,~~March 31, 2024 and 2023, the Company recorded $1.3 million and ~~2022, the combined~~$1.0 million of total stock compensation expense (net of forfeitures) ~~which was~~, respectively. The stock compensation expense is included in ~~the caption “General~~“General and administrative ~~expenses”~~expenses” in the ~~Company’s unaudited~~ condensed consolidated statements of ~~operations was $3.5 million and $3.3 million, respectively.~~operations. Forfeiture recoveries were immaterial for both periods.

~~10. RELATED PARTY TRANSACTIONS~~

~~Investment Advisory Agreement~~

~~Each of DME, DME II, and DME Advisors is an affiliate of the Chairman and, therefore, is a related party to the Company.~~

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The Company has entered into the SILP LPA (as described in Note 3 of the unaudited condensed consolidated financial statements). DME II receives a performance allocation equal to (with capitalized terms having the meaning provided under the SILP LPA) (a) 10% of the portion of the Positive Performance Change for each limited partner’s capital account that is less than or equal to the positive balance in such limited partner’s Carryforward Account, plus (b) 20% of the portion of the Positive Performance Change for each limited partner’s capital account that exceeds the positive balance in such limited partner’s Carryforward Account. The Carryforward Account for Greenlight Re and GRIL includes the amount of investment losses to be recouped, including any loss generated on the assets invested in SILP, subject to adjustments for redemptions. The loss carry-forward provision in the SILP LPA allows DME II to earn a reduced performance allocation of 10% of profits in years subsequent to any year in which SILP has incurred a loss until all losses are recouped, and an additional amount equal to 150% of the loss is earned.

~~In accordance with the SILP LPA, DME Advisors constructs a levered investment portfolio as agreed by the Company (the “Investment Portfolio”, as defined in the SILP LPA)~~

12. On September 1, 2018, SILP entered into the IAA with DME Advisors, which entitles DME Advisors to a monthly management fee equal to 0.125% (1.5% on an annual basis) of each limited partner’s Investment Portfolio. The IAA has an initial term ending on August 31, 2023, subject to an automatic extension for successive three-year terms.EARNINGS PER SHARE

~~For~~The following table reconciles net income and weighted average shares used in computing basic and diluted EPS for the three months ended March 31, 2024 and 2023:


	Three months ended March 31
	2024		2023
Numerator for EPS
Net income - basic	$	27,019	$	5,887
Add: interest on convertible notes	—		776
Less: gain on repurchase of convertible notes	—		(265)
Net income - diluted	$	27,019	$	6,398

Denominator for EPS
Weighted average shares outstanding - basic	34,272,230		34,059,185
Effect of dilutive employee and director share-based awards	381,151		341,263
Shares potentially issuable in connection with convertible notes	—		3,831,159
Weighted average shares outstanding - diluted	34,653,381		38,231,607
Anti-dilutive stock options outstanding	902,140		690,337



EPS:
Basic	$	0.79	$	0.17
Diluted	$	0.78	$	0.17

13.NET INVESTMENT INCOME

The following table provides a ~~detailed~~breakdown of net investment income:


	Three months ended March 31
	2024		2023
Interest and dividend income, net of withholding taxes and other expenses	$	8,556	$	8,628
Net realized and unrealized gains on other investments (see Note 4)	(413)		(250)
Net investment-related income	8,143		8,378
Share of Solasglas' net income (see Note 3)	18,248		(3,138)
Total investment income	$	26,391	$	5,240

14. RELATED PARTY TRANSACTIONS

Investment Advisory Agreement

There has been no change to the Company’s agreement with SILP as described in its 2023 Form 10-K. Refer to Note 3 for a breakdown of management fees and performance ~~compensation~~fees for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 ~~and 2022 (see Note 3).~~

Pursuant to the SILP LPA and the IAA, the Company has agreed to indemnify DME, DME II, and DME Advisors for any expense, loss, liability, or damage arising out of any claim asserted or threatened in connection with DME Advisors serving as the Company’s or SILP’s investment advisor. The Company will reimburse DME, DME II, and DME Advisors for reasonable costs and expenses of investigating and defending such claims, provided such claims were not caused due to gross negligence, breach of contract, or misrepresentation by DME, DME II, or DME Advisors. The Company incurred no indemnification amounts during the periods presented.

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Green Brick Partners, Inc.

David Einhorn also serves as the Chairman of the Board of Directors of Green Brick Partners, Inc. (“GRBK”), a publicly-traded company. At ~~September 30, 2023,~~March 31, 2024, SILP, along with certain affiliates of DME Advisors, collectively owned ~~29.1%~~25.2% of the issued and outstanding common shares of GRBK. Under applicable securities laws, DME Advisors may sometimes be limited in its ability to trade GRBK shares held in SILP. At ~~September 30, 2023,~~March 31, 2024, SILP held ~~2.7~~1.8 million shares of GRBK.

Service Agreement

The Company has entered into a service agreement with DME Advisors, pursuant to which DME Advisors provides certain investor relations services to the Company for compensation of five thousand dollars per month (plus expenses). The agreement automatically renews annually until terminated by either the Company or DME Advisors for any reason with 30 days prior written notice to the other party.

Collateral Assets Investment Management Agreement

Effective January 1, 2019, the Company (and its subsidiaries) entered into a collateral assets investment management agreement (the “CMA”) with DME Advisors, pursuant to which DME Advisors manages certain assets of the Company that are not subject to the SILP LPA and are held by the Company to provide collateral required by the cedents in the form of trust accounts and letters of credit. In accordance with the CMA, DME Advisors receives no fees and is required to comply with the collateral investment guidelines. The CMA can be terminated by any of the parties upon 30 days’ prior written notice to the other parties.

15. COMMITMENTS AND CONTINGENCIES

a) Concentration of Credit Risk

Cash and cash equivalents

The Company monitors its concentration of credit risk with financial institutions and limits acceptable counterparties based on current rating, outlook and other relevant factors.

Investments

The Company’s credit risk exposure to private debt and convertible debt securities within its “Other investments” are immaterial (see Note 4).

Reinsurance balances receivable, net

The following table shows the breakdown of reinsurance balances receivable:


	March 31, 2024				December 31, 2023
	Amount		%		Amount		%
Premiums receivable	$	241,910	34.9	%	$	186,940	30.2	%

Funds withheld:
Funds held by cedants	48,148		7.0	%	50,075		8.1	%
Premiums held by Lloyds' syndicates	293,533		42.3	%	264,278		42.7	%
Funds at Lloyd’s	107,681		15.5	%	115,772		18.6	%

Profit commission receivable	3,060		0.4	%	2,302		0.4	%

Deposit assets	275		—	%	888		0.1	%
Total before provision	694,607		100.1	%	620,255		100.1	%
Provision for expected credit losses	(865)		(0.1)	%	(854)		(0.1)	%
Reinsurance balances receivable, net	$	693,742	100.0	%	$	619,401	100.0	%

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~~11. COMMITMENTS AND CONTINGENCIES~~

~~Letters~~The Company has posted deposits at Lloyd’s to support underwriting capacity for certain syndicates, including Syndicate 3456. Lloyd’s has a credit rating of ~~Credit and Trusts~~

~~At September 30, 2023, the Company had the following committed letter of credit facility:~~

~~Maximum Facility Limit~~

~~Termination Date~~

~~Notice period required for termination~~

~~($ in thousands)~~

~~Citibank Europe plc~~

~~275,000~~

~~August 20, 2024~~

~~120 days before the termination date~~

“A” (Excellent) from A.M. Best.

~~In addition,~~Premiums receivable includes a significant portion of estimated premiums not yet due. Brokers and other intermediaries are responsible for collecting premiums from customers on the Company’s behalf. The Company monitors its concentration of credit risks from brokers. The diversity in the Company’s client base limits credit risk associated with premiums receivable and funds (premiums) held by cedents. Further, under the reinsurance contracts the Company has ~~a $14.0 million uncommitted letter of credit facility with Citibank Europe plc.~~contractual rights to offset premium balances receivable and funds held by cedants against corresponding payments for losses and loss expenses.

~~At September 30, 2023, an aggregate amount of $268.2 million (December 31, 2022: $203.9 million) in letters of credit was issued under both the committed~~Loss and uncommitted credit facilities. At September 30, 2023, the Company had pledged total cash and cash equivalents with a fair value in the aggregate of $269.0 million (December 31, 2022: $204.7 million) as collateral against the letters of credit issued and included in the caption “Restricted cash and cash equivalents” in the Company’s unaudited condensed consolidated balance sheets. The Company was in compliance with all the covenants of these facilities at September 30, 2023.loss adjustment expenses recoverable, net

The Company ~~has also established regulatory trust arrangements~~regularly evaluates its net credit exposure to the retrocessionaires and their abilities to honor their respective obligations. See Note 8 for ~~certain cedents. At September 30, 2023, collateral~~analysis of ~~$342.0 million (December 31, 2022: $463.7 million) was provided~~concentration of credit risk relating to ~~cedents in the form of regulatory trust accounts and included in the caption “Restricted cash and cash equivalents” in the Company’s unaudited condensed consolidated balance sheets.~~retrocessionaires.

b) Lease Obligations

There has been no material change to the Company’s operating lease agreements as described in its 2023 Form 10-K.

c) Litigation

From time to time, in the ordinary course of business, the Company may be involved in formal and informal dispute resolution procedures, which may include arbitration or litigation. The outcomes of these procedures determine the rights and obligations under the Company’s reinsurance contracts and other contractual agreements. In some disputes, the Company may seek to enforce its rights under an agreement or collect funds owed. In other matters, the Company may resist attempts by others to collect funds or enforce alleged rights. While the Company cannot predict the outcome of legal disputes with certainty, the Company does not believe that any existing dispute, when finally resolved, will have a material adverse effect on the Company’s business, financial condition, or operating results.

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~~12.~~16. SEGMENT REPORTING

The Company has one operating ~~segment,~~segment: Property & Casualty ~~(Re)insurance.~~Reinsurance.

The following tables provide a breakdown of the Company’s gross premiums written by line and class of business, and by geographic area of risks insured for the periods indicated:

Gross Premiums Written by Line of Business


		Three months ended September 30										Nine months ended September 30
		2023					2022					2023				2022
		($ in thousands)										($ in thousands)								Three months ended March 31
						2024															2024						2023 (1)
Property	Property
Commercial
Commercial
Commercial	Commercial	$	16,105	8.8	%		$	2,146	1.4	%		$	45,236	8.6	%	$	8,648	2.0	%			$	18,166	8.4	8.4	%		$	14,691	7.9		7.9	%
Motor	Motor	122		0.1			206		0.1			706		0.1		768		0.2
Personal	Personal	16,713		9.1			17,669		11.4			48,718		9.3		49,425		11.3
Total Property	Total Property	32,940		18.0			20,021		12.9			94,660		18.0		58,841		13.5

Casualty	Casualty
Casualty
Casualty
General Liability
General Liability
General Liability	General Liability	31,325		17.1			13,798		8.9			79,401		15.1		40,523		9.3
Motor Liability	Motor Liability	2,917		1.6			565		0.4			11,223		2.1		4,061		0.9
Professional Liability	Professional Liability	3,206		1.8			242		0.2			9,478		1.8		496		0.1
Workers' Compensation	Workers' Compensation	4,484		2.4			7,216		4.6			11,542		2.2		25,504		5.9
Multi-line	Multi-line	67,032		36.6			69,419		44.7			172,916		33.0		177,647		40.8
Total Casualty	Total Casualty	108,964		59.5			91,240		58.8			284,560		54.2		248,231		57.0

Other	Other
Other
Other
Accident & Health
Accident & Health
Accident & Health	Accident & Health	1,695		0.9			5,879		3.8			6,184		1.2		10,377		2.4
Financial	Financial	17,059		9.3			20,065		12.9			48,406		9.2		56,481		12.9
Marine	Marine	3,973		2.2			4,675		3.0			23,967		4.6		18,425		4.2
Other Specialty	Other Specialty	18,443		10.1			13,266		8.6			66,695		12.8		43,457		10.0
Total Other	Total Other	41,170		22.5			43,885		28.3			145,252		27.8		128,740		29.5
		$	183,074	100.0	%		$	155,146	100.0	%		$	524,472	100.0	%	$	435,812	100.0	%
											$																			$	217,258			100.0	%	$	186,455	100.0	%

(1) During the three months ended June 30, 2023, the Company reclassified certain reinsurance contracts within Property, Casualty and Other resulting in a presentation change to the previously reported gross premiums written for the three months ended March 31, 2023, to conform with the revised presentation. This resulted in reclassifying $8.1 million from Casualty (mostly multi-line class), and $7.9 million to Other (mostly marine and other specialty classes) and $0.2 million to Property for the three months ended March 31, 2023.

Gross Premiums Written by Geographic Area of Risks Insured


		Three months ended September 30										Nine months ended September 30
		2023					2022					2023				2022
		($ in thousands)										($ in thousands)									Three months ended March 31
						2024																2024					2023
U.S. and Caribbean	U.S. and Caribbean	$	77,274	42.2	%		$	72,105	46.5	%		$	206,714	39.4	%	$	224,324	51.5	%	U.S. and Caribbean			$	57,374	26.4	26.4	%	$	69,852			37.5	37.5		%
Worldwide (1)	Worldwide (1)	88,037		48.1			79,512		51.3			269,430		51.4		196,197		45.0
Europe (2)		1,868		1.0			(1,797)		(1.2)			8,936		1.7		2,962		0.7
Europe
Asia	Asia	15,895		8.7			5,326		3.4			39,392		7.5		12,329		2.8
		$	183,074	100.0	%		$	155,146	100.0	%		$	524,472	100.0	%	$	435,812	100.0	%
											$																			$	217,258			100.0		%	$	186,455	100.0	%

(1) “Worldwide” is composed of contracts that reinsure risks in more than one geographic area and may include risks in the U.S.

~~(2)~~

~~The negative balance represents the reversal of premiums due to premium adjustments, termination of contracts, or premium returned upon novation or commutation of contracts.~~

2221

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Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References to “we,” “us,” “our,” “our company,” or “the Company” refer to Greenlight Capital Re, Ltd. (“GLRE”) and its wholly-owned subsidiaries unless the context dictates otherwise. See Item 1, Note 1 of the ~~unaudited condensed consolidated~~ financial statements for list of our wholly-owned subsidiaries. ~~References to our “ordinary shares” refer collectively to our Ordinary, Class A Ordinary, and Class B Ordinary shares.~~

The following discussion should be read in conjunction with the audited consolidated financial statements and accompanying notes, which appear in our ~~2022~~2023 Form 10-K.

The following is amanagement’s discussion and analysis (“MD&A”) of our results of operations for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2024 and 2023 and ~~2022 and~~the Company’s financial condition at ~~September 30, 2023~~March 31, 2024 and December 31, ~~2022.~~2023 (herein referred as “Q1 2024 Financials”).

~~OVERVIEW~~All amounts are reported in U.S. dollars, unless otherwise noted. Tabular dollars are presented in thousands, with the exception of per share amounts or as otherwise noted.

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Overview

Business Overview

We are a global specialty property and casualty ~~(re)insurer~~reinsurer headquartered in the Cayman Islands, with an underwriting and investment strategy that we believe differentiates us from most of our competitors. Our goal is to build long-term shareholder value by providing risk management solutions to the insurance, reinsurance, and other risk marketplaces. ~~We focus on delivering risk solutions to clients and brokers who value our expertise, analytics, and customer service offerings.~~

We aim to complement our underwriting activities with a non-traditional investment approach designed to achieve higher rates of return over the long term than reinsurance companies that exclusively employ more traditional investment strategies. Our investment portfolio is managed according to a value-oriented philosophy, in which our investment advisor takes long positions in perceived undervalued securities and short positions in perceived overvalued securities.

~~Through Greenlight Re Innovations (“Innovations”), we support technology innovators~~We earned net income of $27.0 million for the three months ended March 31, 2024, an increase of $21.1 million, or 359% over the same period in the ~~(re)insurance market by providing~~prior year, principally due to stronger performance from our investment ~~capital, risk capacity,~~in SILP and ~~access~~ to a ~~broad insurance network.~~

~~Because we seek to capitalize on favorable market conditions and opportunities, period-to-period comparisons of our~~lesser extent improved underwriting results may not be meaningful. Also, our historical investment results are not necessarily indicative of future performance. Due to the nature of our reinsurance and investment strategies, our operating results will likely fluctuate from period to period.performance despite higher CAT losses.

The ~~Company’s reinsurance subsidiaries hold~~following is a summary of our financial performance for the three months ended March 31, 2024, compared to the same period in 2023:

•Gross premiums written was $217.3 million, an ~~A.M. Best~~increase of 16.5%;

•Net premiums earned was $161.5 million, an increase of 13.2%;

•Net underwriting income (1) was $3.4 million, compared to $0.4 million;

•Total investment income was $26.4 million, an increase of 403.6% (including 5.2% net return from our investment in SILP, compared to a loss of 1.1%);

•Diluted EPS was $0.78, compared to $0.17; and

•Fully diluted book value per share(1) was $17.39, an increase of 3.9%.

(1) See “Key Financial ~~Strength Rating~~Measures and Non-GAAP Measures” section of ~~A- (Excellent) with a stable outlook, which was re-affirmed by A.M. Best on September 29, 2023.~~this MD&A.

Outlook and Trends

Further to increasing competition in the market at the January 1, 2024 renewal season, we have continued to see higher levels of competition in the market in most classes of business throughout the first quarter. Most notably at the April 1 renewals, we observed an increase in capacity related to property catastrophe and specialty classes. Specific to Japanese property renewals, the pricing was impacted by the devaluation of the Japanese Yen over the trailing 12 months. We have seen market conditions stabilize relative to prior year, but continue to view the property and specialty market as attractive.

Market headline catastrophic events occurring in the first quarter of 2024 include the January 1 Noto Peninsula earthquake in Japan and the March 26 collapse of the Francis Scott Key bridge in Baltimore, Maryland. The Japan earthquake event is anticipated to result in minimal losses ceded to the reinsurance market, and market conditions at the April 1 renewal reflected this, with risk adjusted rates modestly down and little evidence of supply constraints. Conversely, market sources are indicating that the Baltimore bridge collapse might be among the largest-ever Marine industry losses. As a result we expect the Marine & Energy reinsurance market to continue experiencing favorable pricing conditions.

~~We operate in a business where we expect volatility in our underwriting result.~~ In 2023, we have witnessed one of the costliest on record for U.S. severe storms, which contributed to our CAT losses during the first half of the year. In the third quarter we incurred additional CAT losses from a Mexican state-owned oil platform fire and two satellite loss events. Accordingly, our CAT incurred losses were $13.1 million and $29.5 million, net of reinsurance, for the three and nine months ended September 30, 2023, respectively.

While the global inflationary pressures have abated from their recent highs, we believe inflation continues to be a significant concern within the (re)insurance industry, as it can add uncertainty to the cost of claims, particularly for classes of business with long payout tails. As a result, it creates pricing challenges for new business and valuation challenges in claims reserves. We continue to manage these concerns and risks in multiple ways:

•Our underwriting strategy focuses on relatively short-tailed business, which is inherently less exposed to inflation than long-tailed lines. We estimate the payout duration of our existing reserves at less than three years.

•~~We incorporate inflation assumptions in all our pricing and reassess these assumptions frequently.~~

•~~We are minimizing our exposure to classes that are experiencing severe supply-chain-driven inflation.~~

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The rising interest rate environment has had a mixed impact on our financial results. Our term loan is partially exposed to fluctuations in the SOFR interest rate. While in 2022 we experienced losses driven by fixed-income securities held by the Lloyd’s syndicates in which we participate, we have seen a reversal of this in 2023 as maturing fixed-income securities are reinvested at higher yields. In addition, the higher interest rates have improved the yield on our restricted cash and cash equivalents. To the extent interest rates continue to increase, we expect to see these trends continue. The SILP portfolio is positioned to also benefit from an inflationary environment.

The combination of the recent significant loss events, continued social inflation, and rising interest rates led to a significant reduction in the amount of reinsurance capital available for deployment, which in turn led to attractive market conditions for 2023. We expect these conditions to continue into the 2024 January renewals. We are also encouraged by the growth of our innovations portfolio and continue to find innovative ways to foster our insurtech partnerships as part of our long term strategy.

Key Financial Measures and Non-GAAP Measures

Management uses certain key financial measures, some of which are not prescribed under U.S. GAAP rules and standards (“non-GAAP financial measures”), to evaluate our financial performance, financial position, and the change in shareholder value. Generally, a non-GAAP financial measure, as defined in SEC Regulation G, is a numerical measure of a company’s historical or future financial performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented under U.S. GAAP. We believe that these measures, which may be calculated or defined differently by other companies, provide consistent and comparable metrics of our business performance to help shareholders understand performance trends and facilitate a more thorough understanding of the Company’s business. Non-GAAP financial measures should not be viewed as substitutes for those determined under U.S. GAAP.

~~The non-GAAP financial measures used in this report are:~~

•~~Basic book value per share and fully diluted book value per share; and~~

•~~Net underwriting income (loss)~~

~~These~~There have been no changes to our key financial measures, including non-GAAP financial measures, ~~are~~as described ~~below.~~in the MD&A of our 2023 Form 10-K.

~~Basic Book Value Per Share and~~ Fully Diluted Book Value Per Share

~~We believe that long-term growth in~~The following table presents a reconciliation of the fully diluted book value per share ~~is the most relevant measure of our financial performance because it provides management and investors a yardstick~~ to ~~monitor the shareholder value generated. Fully diluted~~basic book value per share ~~may also help our investors, shareholders, and other interested parties form a basis of comparison~~(the most directly comparable U.S. GAAP financial measure):


	March 31, 2024			December 31, 2023			September 30, 2023			June 30, 2023			March 31, 2023
Numerator for basic and fully diluted book value per share:
Total equity as reported under U.S. GAAP	$	624,458		$	596,095		$	575,865		$	561,121		$	510,041


Denominator for basic and fully diluted book value per share:
Ordinary shares issued and outstanding as reported and denominator for basic book value per share	35,321,144			35,336,732			35,337,407			35,272,013			35,262,678
Add: In-the-money stock options (1) and all outstanding RSUs	585,334			264,870			312,409			312,409			312,409
Denominator for fully diluted book value per share	35,906,478			35,601,602			35,649,816			35,584,422			35,575,087

Basic book value per share	$	17.68		$	16.87		$	16.30		$	15.91		$	14.46
Increase in basic book value per share ($)	$	0.81		$	0.57		$	0.39		$	1.45		$	0.01
Increase in basic book value per share (%)	4.8		%	3.5		%	2.5		%	10.0		%	0.1		%

Fully diluted book value per share	$	17.39		$	16.74		$	16.15		$	15.77		$	14.34
Increase in fully diluted book value per share ($)	$	0.65		$	0.59		$	0.38		$	1.43		$	0.01
Increase in fully diluted book value per share (%)	3.9		%	3.7		%	2.4		%	10.0		%	0.1		%

(1) Assuming net exercise by the grantee.

The above comparative prior quarters have been restated to conform with ~~other companies within~~ the ~~property and casualty reinsurance industry. Basic book value per share~~revised calculation for basic and fully diluted book value per share ~~should not be viewed~~ as ~~substitutes for~~described in the ~~comparable U.S. GAAP measures.~~MD&A of our 2023 Form 10-K.

We calculate basic book value per share as (a) ending shareholders' equity, divided by (b) aggregate of ordinary shares issued and outstanding, including all unvested service-based restricted shares, and the earned portion of performance-based restricted shares granted after December 31, 2021. We exclude shares potentially issuable in connection with convertible notes if the conversion price exceeds the share price. We repaid all outstanding convertible notes on August 1, 2023 without issuing any shares.

Fully diluted book value per share represents basic book value per share combined with any dilutive impact of in-the-money stock options, unvested service-based RSUs, and the earned portion of unvested performance-based RSUs granted. Fully diluted book value per share also includes the dilutive effect, if any, of ordinary shares expected to be issued upon settlement of the convertible notes.

~~Our primary financial goal is to increase fully diluted book value per share over the long term. We use fully diluted book value per share as a financial measure in our annual incentive compensation.~~

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~~The following table presents a reconciliation of the non-GAAP financial measures basic and fully diluted book value per share to the most comparable U.S. GAAP measure:~~

September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 September 30, 2022
($ in thousands, except per share and share amounts)
Numerator for basic and fully diluted book value per share:
Total equity (U.S. GAAP) (numerator for basic and fully diluted book value per share) $ 575,865 $ 561,121 $ 510,041 $ 503,120 $ 466,952
Denominator for basic and fully diluted book value per share: (1)
Ordinary shares issued and outstanding as presented in the Company’s consolidated balance sheets 35,337,407 35,272,013 35,262,678 34,824,061 34,824,061
Less: Unearned performance-based restricted shares granted after December 31, 2021 (785,003) (820,156) (851,828) (516,489) (539,161)
Denominator for basic book value per share 34,552,404 34,451,857 34,410,850 34,307,572 34,284,900
Add: In-the-money stock options, service-based RSUs granted, and earned performance-based RSUs granted 171,150 164,116 157,431 187,750 183,790
Denominator for fully diluted book value per share 34,723,554 34,615,973 34,568,281 34,495,322 34,468,690
Basic book value per share $ 16.67 $ 16.29 $ 14.82 $ 14.66 $ 13.62
Increase (decrease) in basic book value per share ($) $ 0.38 $ 1.47 $ 0.16 $ 1.04 $ (0.56)
Increase (decrease) in basic book value per share (%) 2.3 % 9.9 % 1.1 % 7.6 % (3.9) %
Fully diluted book value per share $ 16.58 $ 16.21 $ 14.75 $ 14.59 $ 13.55
Increase (decrease) in fully diluted book value per share ($) $ 0.37 $ 1.46 $ 0.16 $ 1.04 $ (0.55)
Increase (decrease) in fully diluted book value per share (%) 2.3 % 9.9 % 1.1 % 7.7 % (3.9) %

~~(1)~~ For periods prior to January 1, 2022, all unvested restricted shares are included in the “basic” and “fully diluted” denominators. Restricted shares with performance-based vesting conditions granted after December 31, 2021, are included in the “basic” and “fully diluted” denominators to the extent that the Company has recognized the corresponding share-based compensation expense. At September 30, 2023, the aggregate number of unearned restricted shares with performance conditions not included in the “basic” and “fully diluted” denominators was 947,492 (June 30, 2023: 982,645, March 31, 2023: 1,014,317, December 31, 2022: 709,638, September 30, 2022: 732,310).

Net Underwriting Income (Loss)

One way that we evaluate the Company’s underwriting performance is by measuring net underwriting income (loss). We do not use premiums written as a measure of performance. Net underwriting income (loss) is a performance measure used by management to evaluate the fundamentals underlying the Company’s underwriting operations. We believe that the use of net underwriting income (loss) enables investors and other users of the Company’s financial information to analyze our performance in a manner similar to how management analyzes performance. Management also believes this measure follows industry practice and allows the users of financial information to compare the Company’s performance with that of our industry peer group.

Net underwriting income (loss) is considered a non-GAAP financial measure because it excludes items used to calculate net income before taxes under U.S. GAAP. We calculate net underwriting income (loss) as net premiums earned less net loss and loss adjustment expenses, acquisition costs, underwriting expenses, and deposit interest expense. The measure excludes, on a recurring basis: (1) investment income (loss); (2) other income (expense) not related to underwriting, including foreign

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exchange gains or losses, and Lloyd’s interest income and expense; (3) corporate general and administrative expenses; and (4) interest expense. We exclude total investment income or loss, foreign exchange gains or losses, and Lloyd’s interest income or expense as we believe these items are influenced by market conditions and other factors unrelated to underwriting decisions. Additionally, we exclude corporate and interest expenses because these costs are generally fixed and not incremental to or directly related to our underwriting operations. We believe all of these amounts are largely independent of our underwriting process, and including them could hinder the analysis of trends in our underwriting operations. Net underwriting income (loss) should not be viewed as a substitute for U.S. GAAP net income before income taxes.

The reconciliations of net underwriting income (loss) to income (loss) before income taxes (the most directly comparable U.S. GAAP financial measure) on a consolidated basis are shown below:

Three months ended September 30 Nine months ended September 30
2023 2022 2023 2022
($ in thousands)
Income (loss) before income tax $ 13,506 $ (19,285) $ 69,335 $ (10,231)
Add (subtract):
Total investment (income) loss (5,105) (11,559) (52,496) (36,452)
Other non-underwriting (income) expense 1,293 6,784 (13,399) 13,374
Corporate expenses 3,266 4,104 13,820 12,693
Interest expense 1,457 1,091 2,977 3,411
Net underwriting income (loss) $ 14,417 $ (18,865) $ 20,237 $ (17,205)


	Three months ended March 31
		2024		2023
Income before income tax		$	27,538	$	5,941
Add (subtract):
Total investment income		(26,391)		(5,240)
Foreign exchange losses (gains)		1,649		(4,931)
Other non-underwriting income		(5,035)		(2,166)
Corporate expenses		4,375		5,997
Interest expense		1,249		776
Net underwriting income		$	3,385	$	377

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~~CONSOLIDATED RESULTS OF OPERATIONS~~Consolidated Results of Operations

The table below summarizes our consolidated operating results for the three ~~and nine~~ months ended ~~September 30, 2023~~March 31, 2024 and ~~2022:~~2023:


		Three months ended September 30						Nine months ended September 30
								2024
		2023			2022			2023			2022
								2024
		(in thousands, except percentages)
								2024
Underwriting revenue
Underwriting revenue
Underwriting revenue	Underwriting revenue
Gross premiums written	Gross premiums written	$	183,074		$	155,146		$	524,472		$	435,812
Gross premiums written
Gross premiums written
Gross premiums ceded
Gross premiums ceded
Gross premiums ceded	Gross premiums ceded	(14,789)			(8,801)			(35,740)			(21,973)
Net premiums written	Net premiums written	168,285			146,345			488,732			413,839
Net premiums written
Net premiums written
Change in net unearned premium reserves
Change in net unearned premium reserves
Change in net unearned premium reserves	Change in net unearned premium reserves	(5,175)			(24,397)			(43,030)			(55,747)
Net premiums earned	Net premiums earned	$	163,110		$	121,948		$	445,702		$	358,092
Net premiums earned
Net premiums earned
Underwriting related expenses	Underwriting related expenses
Underwriting related expenses
Underwriting related expenses
Net loss and loss adjustment expenses incurred:
Net loss and loss adjustment expenses incurred:
Net loss and loss adjustment expenses incurred:
Current year
Current year
Current year
Prior year (1)
Prior year (1)
Prior year (1)
Net loss and loss adjustment expenses incurred	Net loss and loss adjustment expenses incurred
Current year		$	100,143		$	92,444		$	273,570		$	251,231
Prior year *		(3,300)			2,116			10,502			1,558
Net loss and loss adjustment expenses incurred
Net loss and loss adjustment expenses incurred	Net loss and loss adjustment expenses incurred	96,843			94,559			284,072			252,789
Acquisition costs	Acquisition costs	46,933			36,821			126,702			106,101
Acquisition costs
Acquisition costs
Underwriting expenses
Underwriting expenses
Underwriting expenses	Underwriting expenses	4,639			3,285			14,046			10,034
Deposit interest expense	Deposit interest expense	278			6,148			645			6,373
Net underwriting income (loss) 1		$	14,417		$	(18,865)		$	20,237		$	(17,205)
Deposit interest expense
Deposit interest expense
Net underwriting income (2)
Net underwriting income (2)
Net underwriting income (2)

Income (loss) from investment in related party investment fund		$	(1,853)		$	8,521		$	27,791		$	24,474
Net investment income (loss)		6,958			3,038			24,705			11,978
Total investment income (loss)		$	5,105		$	11,559		$	52,496		$	36,452
Net underwriting and investment income (loss)		$	19,522		$	(7,306)		$	72,733		$	19,247
Income (loss) from investment in Solasglas

Income (loss) from investment in Solasglas

Income (loss) from investment in Solasglas
Net investment income
Net investment income
Net investment income
Total investment income
Total investment income
Total investment income

Corporate expenses	Corporate expenses	$	3,266		$	4,104		$	13,820		$	12,693
Other (income) expense, net		1,293			6,784			(13,399)			13,374

Corporate expenses

Corporate expenses
Foreign exchange losses (gains)
Foreign exchange losses (gains)
Foreign exchange losses (gains)
Other income, net
Other income, net
Other income, net
Interest expense	Interest expense	1,457			1,091			2,977			3,411
Income tax expense (benefit)		29			(816)			111			(823)
Net income (loss)		$	13,477		$	(18,469)		$	69,224		$	(9,408)
Interest expense
Interest expense
Income tax expense
Income tax expense
Income tax expense
Net income
Net income
Net income

Earnings (loss) per share:
Earnings per share:

Earnings per share:

Earnings per share:
Basic
Basic
Basic	Basic	$	0.40		$	(0.56)		$	2.03		$	(0.28)
Diluted	Diluted	$	0.39		$	(0.56)		$	1.99		$	(0.28)
Diluted
Diluted

Underwriting ratios
Underwriting ratios:

Underwriting ratios:

Underwriting ratios:
Loss ratio - current year
Loss ratio - current year
Loss ratio - current year	Loss ratio - current year	61.4		%	75.8		%	61.4		%	70.2		%
Loss ratio - prior year	Loss ratio - prior year	(2.0)		%	1.7		%	2.4		%	0.4		%
Loss ratio - prior year
Loss ratio - prior year
Loss ratio
Loss ratio
Loss ratio	Loss ratio	59.4		%	77.5		%	63.8		%	70.6		%
Acquisition cost ratio	Acquisition cost ratio	28.8		%	30.2		%	28.4		%	29.6		%
Acquisition cost ratio
Acquisition cost ratio
Composite ratio
Composite ratio
Composite ratio	Composite ratio	88.2		%	107.7		%	92.2		%	100.2		%
Underwriting expense ratio	Underwriting expense ratio	3.0		%	7.7		%	3.3		%	4.6		%
Underwriting expense ratio
Underwriting expense ratio
Combined ratio	Combined ratio	91.2		%	115.4		%	95.5		%	104.8		%
Combined ratio
Combined ratio

~~Return to table of contents~~1

* The net financial impacts associated with changes in the estimate of losses incurred in prior years, which incorporate earned reinstatement premiums assumed and ceded, adjustments to assumed and ceded acquisition costs, and deposit interest expense, were ~~an income of $1.8 million and~~ a loss of ~~$2.9~~$5.4 million and $12.0 million for the three months ended ~~September 30,~~March 31, 2024 and 2023, ~~and 2022, respectively, and a loss of $12.2 million and $9.0 million for the nine months ended September 30, 2023 and 2022,~~ respectively.

1Return to table of contents

2 Net underwriting income (loss) is a non-GAAP financial measure. See “ Key Financial Measures and Non-GAAP Measures” above for discussion and reconciliation of non-GAAP financial measures.

~~Overview~~The following provides further details on the significant variances for the first quarter 2024 (“Q1 2024”) compared to same quarter in 2023 (“Q1 2023”).

~~Three months ended September 30, 2023 and 2022~~Overview

For the three months ended ~~September 30, 2023,~~March 31, 2024, the fully diluted book value per share increased by ~~$0.37~~$0.65 per share, or ~~2.3%~~3.9%, to ~~$16.58~~$17.39 per share from ~~$16.21~~$16.74 per share at ~~June 30,~~December 31, 2023. For the three months ended ~~September 30, 2023,~~March 31, 2024, basic book value per share increased by ~~$0.38~~$0.81 per share, or ~~2.3%~~4.8%, to ~~$16.67~~$17.68 per share from ~~$16.29~~$16.87 per share at ~~June 30,~~December 31, 2023.

For the three months ended ~~September 30, 2023,~~March 31, 2024, our net income was ~~$13.5~~$27.0 million, compared to net ~~loss~~income of ~~$18.5~~$5.9 million reported for the equivalent ~~2022~~2023 period.

The developments that most significantly affected our financial performance during ~~the three months ended September 30, 2023,~~Q1 2024, compared to the equivalent ~~2022~~2023 period, are summarized below:

•Underwriting income: ~~Our underwriting income for the three months ended September 30, 2023 was $14.4~~Increased by $3.0 million ~~which included CAT losses of $13.1 million during the third quarter of 2023,~~primarily driven by the Mexican state-owned oil platform fire and two satellite loss events. We reported favorable loss development of $3.3 million driven primarily by property, marine and energy business, partially offset by adverse development relating to motor, workers’ compensation, and professional liability business. By comparison, the equivalent period in 2022 reported an underwriting loss of $18.9 million, which included $25.9 million of CAT losses, primarily related to $19.5 million from Hurricane Ian and $3.2 million from Typhoons Nanmadol and Hinnamnor. Additionally, the underwriting loss in the comparable period in 2022 included $6.1 million of interest expense relating to deposit-accounted contracts that did not meet the risk transfer condition for reinsurance accounting under U.S. GAAP.

~~Our combined ratio was 91.2% for the three months ended September 30, 2023 compared to 115.4% during the equivalent 2022 period. The significant~~1.8 percentage points improvement in our combined ratio ~~was driven mainly by 18.1 points improvement in loss ratio mainly~~ due to lower ~~CAT events, coupled with 4.7 points decrease~~adverse prior year loss development and acquisition costs, offset partially by an increase in underwriting ~~expense~~costs. Current year CAT losses contributed 7.7% to our combined ratio, ~~driven by lower interest expense relating~~compared to ~~deposit-accounted contracts.~~

4.3% in Q1 2023. For further information on CAT losses and prior year loss development, refer to Note 7
- Loss and Loss Ad justment Expense Reserves of the Q1 2024 Financials.

•~~Investments~~Investment income: ~~Our total investment income for the three months ended September 30, 2023 was $5.1~~Increased by $21.2 million ~~compared to total investment income of $11.6 million reported for the same period in 2022.~~primarily driven by stronger results from SILP. Our investment in SILP reported a loss of $1.9 million during the three months ended September 30, 2023, compared to a gain of $8.5 million during the equivalent period in 2022. Other investment income from our Innovation investments and interest earned from our restricted cash and cash equivalents and Funds at Lloyd’s (“FAL”) cash positions totaled $7.0 million and $3.0 million during the three months ended September 30, 2023 and 2022, respectively. The increase in other investment income was driven primarily by increase in short-term yields as a result of the U.S. central bank hiking its benchmark borrowing rate from 5.00% to 5.25% during the quarter.

•~~Other (income) expense: For the three months ended September 30, 2023, we incurred other expense of $1.3 million, compared to $6.8 million for the same quarter in 2022. The favorable change was driven primarily by:~~

◦~~$3.0 million of lower foreign exchange losses, due mainly to a lesser weakening of the U.S. dollar against the pound sterling; and~~

◦our share of Lloyd’s syndicates’ investment income on FAL business, which is generally conducted on a funds withheld basis. The Lloyd’s syndicates invest a portion of these funds in fixed-maturity securities and investment funds. We record our share of the investment income and mark-to-market adjustments of these fixed maturity securities when the syndicates report them to us, generally one quarter in arrears.

~~Return to table of contents~~

~~Nine months ended September 30, 2023, and 2022~~

For the nine months ended September 30, 2023, fully diluted book value per share increased by $1.99, or 13.6%, to $16.58 per share from $14.59 per share at December 31, 2022. For the nine months ended September 30, 2023, basic book value per share increased by $2.01, or 13.7%, to $16.67 per share from $14.66 per share at December 31, 2022.

~~For the nine months ended September 30, 2023, our net income was $69.2 million, compared to net loss of $9.4 million reported for the equivalent 2022 period.~~

~~The developments that most significantly affected our financial performance during the nine months ended September 30, 2023, compared to the equivalent 2022 period, are summarized below:~~

•~~Underwriting~~: Our underwriting income for the nine months ended September 30, 2023, was $20.2 million, which was negatively impacted by $29.5 million of total CAT losses in 2023 including the Turkey earthquake, Cyclone Gabrielle in New Zealand, the U.S. severe storms, the Mexican state-owned oil platform fire, and the two satellite losses. Additionally, we incurred $10.5 million of adverse loss development on prior years’ contracts. By comparison, our underwriting loss for the equivalent period in 2022 was $17.2 million, which was negatively impacted by $42.3 million of CAT losses including $13.6 million related to the Russian-Ukrainian conflict and $25.4 million related to Hurricane Ian, Typhoon Nanmadol and Hinnamnor, and Tennessee wildfires. Additionally, we incurred $1.6 million of adverse loss development on prior year’s contracts during the nine months ended September 30, 2022.

Our combined ratio was 95.5% for the nine months ended September 30, 2023, compared to 104.8% for the same period in 2022. This favorable change was primarily due to our loss ratio improving by 6.8 points due to lower CAT losses, net of 2.0 points increase from prior year adverse loss development compared to 2022. Additionally, our underwriting expense ratio improved by 1.3 points for the same reason noted above for the quarter.

•~~Investments~~: Our total investment income for the nine months ended September 30, 2023, was $52.5 million, compared to $36.5 million earned during the equivalent 2022 period. For the nine months ended September 30, 2023, our investment in SILP reported a gain of ~~$27.8~~$18.2 million during Q1 2024, compared to a ~~gain~~loss of ~~$24.5~~$3.1 million during the equivalent period in ~~2022. Other investment income totaled $24.7~~2023. SILP generated a net return of 5.2% for Q1 2024.

•Corporate expense: Decreased by $1.6 million ~~and $12.0 million during the nine months ended September 30,~~mainly due to non-recurring severance costs included in Q1 2023 and ~~2022, respectively. The increase~~lower outside legal costs following the hiring of our new General Counsel in ~~other investment income was~~April 2023.

•Foreign exchange gains (losses): $1.6 million foreign exchange losses for Q1 2024, compared to $4.9 million foreign exchange gains in Q1 2023, driven ~~primarily~~mainly by ~~increase in short-term yields as previously noted.~~the reversal of the pound sterling movement against the U.S. dollar; and

•Other income, ~~(expense)~~net: ~~For the nine months ended September 30, 2023, other~~Increased by $2.9 million due to stronger investment income ~~was $13.4 million compared to other expense of $13.4 million. The favorable change was driven primarily~~on funds withheld by ~~the same reasons explained above for the quarter, including $18.0 million favorable foreign exchange movement.~~third party Lloyd’s syndicates, reported on a quarterly lag basis.

Underwriting Results by Segment

~~There was no change to our operating segment since December 31, 2022.~~

The following provides a further discussion of our underwriting results for our Property & Casualty (Re)insurance operating segment for the three ~~and nine~~ months ended ~~September 30, 2023~~March 31, 2024 and ~~2022.~~

~~Return to table of contents~~

2023.

Gross Premiums Written

Details of gross premiums written are provided in the following table:


		Three months ended September 30								Nine months ended September 30
		2023				2022				2023				2022					Three months ended March 31
		($ in thousands)								($ in thousands)										2024	2023 (1)
Property	Property	$	32,940	18.0	%	$	20,021	12.9	%	$	94,660	18.0	%	$	58,841	13.5	%	Property				$	25,176	11.6	11.6	%	$	30,560	16.4	16.4	%
Casualty	Casualty	108,964		59.5		91,240		58.8		284,560		54.3		248,231		57.0
Other	Other	41,170		22.5		43,885		28.3		145,252		27.7		128,740		29.5
Total	Total	$	183,074	100.0	%	$	155,146	100.0	%	$	524,472	100.0	%	$	435,812	100.0	%	Total				$	217,258	100.0	100.0	%	$	186,455	100.0	100.0	%

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16 of the Q1 2024 Financials), the gross premiums written for Property, Casualty, and Other were restated accordingly. However, there was no change to the Total gross premiums written.

As a result of our underwriting philosophy, the total premiums we write and the mix of premiums between property,

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casualty, and other business, may vary significantly from period to period depending on the market opportunities we identify.

For the three months ended ~~September 30, 2023,~~March 31, 2024, our gross premiums written increased by ~~$27.9~~$30.8 million, or ~~18.0%~~16.5%, compared to the equivalent ~~2022~~2023 period. The following table provides a further analysis of this overall increase:

Gross Premiums Written
Three months ended September 30, 2023
Increase (decrease)
($ in millions) % change Explanation
Property $12.9 64.5%
The increase was driven from growth in our Commercial class, mainly due to new quota share treaties bound in mid-2022 and new insurance contracts via Syndicate 3456 in 2023. This resulted in a change in business mix for Property, with Commercial and Personal accounting for 49% and 51%, respectively, of total Property compared to 11% and 88%, respectively, for the same quarter in 2022.

Casualty $17.7 19.4%
The increase was driven mainly from growth in General Liability from new contracts and premiums written from quota share treaties bound in 2022. This growth was partially offset by a reduction in the Workers’ Compensation class, where we have significantly reduced appetite for quota share treaties beginning in 2022, coupled with a marginal premium decrease in the Multi-line class.

As a result, the business mix within our Casualty line of business has changed significantly with General Liability and Multi-line classes accounting for 29% and 62% of total Casualty, respectively, compared to 15% and 76% in same period in 2022.
Other $(2.7) (6.2)% The decrease was driven mainly by our decision to non-renew certain Accident & Health programs, coupled with lower premium written for our Financial class. The reduction in Financial premium was predominantly due to lower merger and acquisition activity in 2023 impacting premium from transactional liability programs and lower mortgage origination volumes in 2023 due to surging mortgage rates. This was partially offset by premium growth in the Other Specialty class, driven by favorable pricing and new contracts.

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Gross Premiums Written

Three months ended March 31, 2024

Increase (decrease)
($ in millions)

% change

Explanation

Property

$(5.4)

(17.6)%

The decrease was driven predominantly by the non-renewal of a homeowner treaty within Personal class in order to reduce our exposure to U.S. severe convective storms. This was offset partially by growth in the Commercial class driven by new business. This resulted in a change in business mix for Property, with Commercial and Personal accounting for 72% and 28%, respectively, of total Property compared to 48% and 51%, respectively, for the same quarter in 2023.

Casualty

$19.7

22.6%

The increase was driven predominantly from new quota share business in 2023 and 2024 within our Syndicate 3456, which is included in our Multi-line class. This was partially offset by lower renewals in our Professional class.

As a result, the business mix within our Casualty line of business has changed with General Liability and Multi-line classes accounting for 20% and 70% of total Casualty, respectively, compared to 24% and 62% in same period in 2023.

Other

$16.5

24.0%

The increase was driven mainly from new business in our Marine and Energy class, including Lloyd’s whole account excess of loss treaties, offset partially by lower premiums written within Financial relating to Mortgage business.

For the nine months ended September 30, 2023, our gross premiums written increased by $88.7 million, or 20.3%, compared to the equivalent 2022 period. The changes in gross premiums written for the nine months ended September 30, 2023, were attributable to the following:

Gross Premiums Written
Nine months ended September 30, 2023
Increase (decrease)
($ in millions) % change Explanation
Property $35.8 60.9%
Same explanation as for the three months ended September 30, 2023.

Casualty $36.3 14.6% Same explanation as for the three months ended September 30, 2023.
Other $16.5 12.8%
The increase was driven mainly by new contracts within our Marine class and Other Specialty class, primarily in aviation and cyber risk. This was partially offset by a reduction in Accident & Health and Financial classes for the same reasons as noted above. The decrease was also due partially to $4.4 million premium estimate reduction recorded earlier in 2023 relating to a transactional liability program bound in 2022 within our Financial class.

As a result, the change in business mix was follows: Other Specialty, Financial, and Marine represented 46%, 33%, and 17%, respectively, compared to 34%, 44%, and 14%, respectively, for the same period in 2022.

Premiums Ceded

For the three months ended ~~September 30, 2023,~~March 31, 2024, premiums ceded were ~~$14.8~~$23.2 million, or ~~8.1%~~10.7% of gross premiums written, compared to ~~$8.8~~$11.2 million, or ~~5.7%~~6.0% of gross premiums written, for the same quarter in ~~2022.~~2023. The increase was primarily due to the purchase of an additional reinsurance coverage to reduce our overall exposure to Marine and Energy class in light of recent growth in this class of business, coupled with an increase in quota share retrocessions for ~~Property and Casualty, driven by~~Other Specialty business due to growth from inward premiums.

For the nine months ended September 30, 2023, premiums ceded were $35.7 million, or 6.8% of gross premiums written, compared to $22.0 million, or 5.0% of gross premiums written for the period in 2022. The increase was driven mostly for the same reason noted above, in addition to an aviation quota share retrocession coverage purchased during the second quarter of 2023 as well as an additional $10.0 million excess of loss coverage purchased during the first quarter of 2023 to manage our exposure to marine and energy.

Net Premiums Written

Details of net premiums written are provided in the following table:


		Three months ended September 30								Nine months ended September 30
		2023				2022				2023				2022					Three months ended March 31
		($ in thousands)								($ in thousands)										2024	2023 (1)
Property	Property	$	24,771	14.7	%	$	15,486	10.6	%	$	77,397	15.8	%	$	48,517	11.7	%	Property				$	21,204	10.9	10.9	%	$	26,193	14.9	14.9	%
Casualty	Casualty	103,542		61.5		88,002		60.1		275,578		56.4		242,369		58.6
Other	Other	39,972		23.8		42,857		29.3		135,757		27.8		122,953		29.7
Total	Total	$	168,285	100.0	%	$	146,345	100.0	%	$	488,732	100.0	%	$	413,839	100.0	%	Total				$	194,077	100.0	100.0	%	$	175,243	100.0	100.0	%

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16), the net premiums written for Property, Casualty, and Other were restated accordingly. However, there was no change to the Total net premiums written.

For the three ~~and nine~~ months ended ~~September 30, 2023~~March 31, 2024 net premiums written increased by ~~$21.9~~$18.8 million, or ~~15.0%~~10.7%, ~~and by $74.9 million or 18.1%, respectively,~~ compared to the three ~~and nine~~ months ended ~~September 30, 2022.~~March 31, 2023. The movement in net premiums written resulted from the changes in gross premiums written and ceded during the ~~periods.~~periods as previously noted.

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Net Premiums Earned

Details of net premiums earned are provided in the following table:


		Three months ended September 30									Nine months ended September 30
		2023					2022				2023				2022
		($ in thousands)									($ in thousands)									Three months ended March 31
						2024															2024				2023 (1)
Property	Property	$	24,362	14.9	%		$	10,951	9.0	%	$	63,854	14.3	%	$	37,577	10.5	%	Property			$	23,357	14.5	14.5	%	$	18,767	13.1	13.1	%
Casualty	Casualty	93,514		57.3			76,511		62.7		259,075		58.1		225,322		62.9
Other	Other	45,234		27.8			34,486		28.3		122,773		27.6		95,193		26.6
Total	Total	$	163,110	100.0	%		$	121,948	100.0	%	$	445,702	100.0	%	$	358,092	100.0	%	Total			$	161,536	100.0	100.0	%	$	142,649	100.0	100.0	%

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16), the net premiums earned for Property, Casualty, and Other were restated accordingly. However, there was no change to the Total net premiums earned.

Net premiums earned for the three ~~and nine~~ months ended ~~September 30, 2023,~~March 31, 2024, increased by ~~$41.2~~$18.9 million or ~~33.8%~~13.2%, ~~and $87.6 million or 24.5%, respectively,~~ compared to the three ~~and nine~~ months ended ~~September 30, 2022.~~March 31, 2023. The change in net premiums earned is primarily a function of the amount and timing of net premiums written during the current and prior periods, coupled by the mix of business written in the form of excess of loss versus proportional contracts.

Loss and ~~Loss Adjustment Expenses~~LAE Incurred, Net

~~For the nine months ended September 30, 2023 and 2022, the~~The components of the loss ratio were as follows:


		Three months ended September 30					Nine months ended September 30
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
		2023		2022		Increase / (decrease) in loss ratio points	2023		2022		Increase / (decrease) in loss ratio points	2024	2023	Increase / (decrease) in loss ratio points
Current accident year loss ratio	Current accident year loss ratio	61.4	%	75.8	%	(14.4)	61.4	%	70.2	%	(8.8)
Prior year reserve development ratio	Prior year reserve development ratio	(2.0)	%	1.7	%	(3.7)	2.4	%	0.4	%	2.0
Loss ratio	Loss ratio	59.4	%	77.5	%	(18.1)	63.8	%	70.6	%	(6.8)

Current accident year loss ratio ~~improved~~increased by ~~14.4~~5.0 points for the three months ended ~~September 30, 2023,~~March 31, 2024, compared to the same quarter in ~~2022 mainly due to lower~~2023 driven by higher CAT losses in ~~2023.~~

~~Current accident year loss ratio improved by 8.8 points~~2024, including $10.0 million for the ~~nine months ended September 30, 2023, compared to the same period in 2022 primarily due to 5.2 points in lower CAT losses, coupled with favorable pricing and change in business mix in 2023.~~Baltimore bridge loss event, net of $13.5 million loss recoveries.

For the three ~~and nine~~ months ended ~~September 30, 2023,~~March 31, 2024, we had ~~prior year favorable loss development of 2.0% and adverse loss development of 2.4%, respectively, compared to~~ prior year adverse loss development of ~~1.7% and 0.4%~~3.3%, ~~respectively,~~compared to 8.4% for the same ~~periods~~quarter in ~~2022.~~2023. Refer to Note ~~5 to the unaudited condensed consolidated financial statements~~7 for further details on prior year developments.

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Details of net losses incurred by line of business are provided in the following table:


		Three months ended September 30									Nine months ended September 30
		2023					2022				2023				2022
		($ in thousands)									($ in thousands)									Three months ended March 31
																					2024	2023 (1)
				($ in thousands)																		($ in thousands)
Property	Property	$	13,182		13.6	%	$	13,157	13.9	%	$	52,114	18.4	%	$	28,641	11.3	%	Property				$	11,978	10.9	10.9	%	$	17,530	18.0	18.0	%
Casualty	Casualty	63,044			65.1		60,901		64.4		173,690		61.1		159,918		63.3
Other	Other	20,617			21.3		20,501		21.7		58,268		20.5		64,230		25.4
Total	Total	$	96,843		100.0	%	$	94,559	100.0	%	$	284,072	100.0	%	$	252,789	100.0	%	Total				$	109,326	100.0	100.0	%	$	96,725	100.0	100.0	%

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16), the net losses incurred for Property, Casualty, and Other were restated accordingly. However, there was no change to the Total net losses incurred.

The below table summarizes the loss ratios by line of business:


		Three months ended September 30					Nine months ended September 30
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
		2023		2022		Increase / (decrease) in loss ratio points	2023		2022		Increase / (decrease) in loss ratio points	2024	2023 (1)	Increase / (decrease) in loss ratio points
Property	Property	54.1	%	120.1	%	(66.0)	81.6	%	76.2	%	5.4
Casualty	Casualty	67.4		79.6		(12.2)	67.0		71.0		(4.0)
Other	Other	45.6		59.4		(13.8)	47.5		67.5		(20.0)
Total	Total	59.4	%	77.5	%	(18.1)	63.8	%	70.6	%	(6.8)

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16 ), the loss ratios for Property and Casualty were restated accordingly. However, there was no change to the Total loss ratios.

The ~~changes~~following provides further details on the change in ~~net losses incurred for the three months ended September 30, 2023, as compared to the equivalent 2022 period, were attributable to the following:~~Q1 2024 vs. Q1 2023.

Net Losses Incurred
Three months ended September 30, 2023
Increase (decrease)
($ in millions) Increase / (decrease) in loss ratio points
Property $0.0 (66.0)
Despite the 122.5% increase in net premiums earned, there was virtually no change in our net losses incurred for Property primarily due to an increase in net premium earned from excess of loss contracts at lower loss ratios compared to proportional treaties, coupled with favorable loss development on prior year contracts.

The improvement in loss ratio is primarily due to lower CAT losses. In 2022, we incurred significant CAT losses from Hurricane Ian and Typhoons Nanmadol and Hinnamnor. Excluding the impact of prior year favorable loss development, our attritional loss ratio for Property was lower in the third quarter of 2023 compared to same period in 2022 due to improved pricing.
Casualty $2.1 (12.2)
The increase in losses incurred was primarily driven by the 22.2% increase in net premiums earned and business mix.

The improvement in loss ratio points was predominantly from our Multi-line class which improved by 21.5% due to CAT losses from Hurricane Ian in 2022. This was partially offset by an increase in prior year attritional loss development relating to legacy motor, workers’ compensation and professional liability programs.
Other $0.1 (13.8) The losses incurred included CAT losses from Mexican state-owned oil platform fire and two satellite losses as well as losses from higher volume of premiums earned during the third quarter of 2023 compared to 2022. This increase was offset by favorable changes in prior year development and the change in business mix in Other.

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Net Losses Incurred

Three months ended March 31, 2024

Increase (decrease)
($ in millions)

Increase / (decrease) in loss ratio points

Property

$(5.6)

(42.1)

Despite the 24.6% increase in net premiums earned, our net losses incurred and loss ratio for Property decreased primarily due to higher CAT losses in Q1 2023 from the severe convective storms in the U.S., partially offset by an increase in prior year adverse attritional loss development in Q1 2024 relating mainly to a homeowners program.

Casualty

$(1.0)

(9.7)

Despite the 12.5% increase in net premiums earned, our net losses incurred decreased mainly due to lower prior year adverse loss development in our professional liability, motor, and workers’ compensation exposures. However, this was partially offset by an increase in prior year adverse loss development in our general liability business in Q1 2024.

Other

$19.2

40.1

The increase in losses incurred and loss ratio is predominantly due to current year CAT losses from the Baltimore bridge collapse and satellite failures. Additionally, in Q1 2024 we had prior year adverse loss development compared to favorable loss development in Q1 2023 for Other, which contributed 5.8 loss ratio points.

The prior year adverse loss development in Q1 2024 was mainly related to the Mexican state-owned oil platform fire (2023 underwriting year).

~~The changes in net losses incurred and loss ratios during the nine months ended September 30, 2023, were attributable to the following:~~

Net Losses Incurred
Nine months ended September 30, 2023
Increase (decrease)
($ in millions) Increase / (decrease) in loss ratio points Explanation
Property $23.5 5.4
The increase in losses incurred is primarily due to 69.9% increase in net premiums earned, and to a lesser degree due to current year CAT losses and prior years’ loss development.

The increase in loss ratio points was primarily due to the comparative period loss ratio included 18.8 percentage points of favorable loss development, compared to 1.8 percentage points in 2023.

In 2023, the unprecedented U.S. severe storms losses and other CAT events contributed 28.8 loss ratio points to the Property loss ratio. During the comparable period in 2022, CAT losses from Hurricane Ian, Typhoons Nanmadol and Hinnamnor, and Tennessee wildfires contributed 31.8 percentage points to the Property loss ratio.

Adjusting for the impact of prior years’ loss development and CAT losses, the current period attritional Property loss ratio improved by 8.6 percentage points in 2023, compared to the same period in 2022, mainly due to improved pricing in 2023 and a higher volume of excess-of-loss treaties compared to proportional treaties.

Casualty $13.8 (4.0)
The increase in losses incurred was primarily driven by the 15.0% increase in net premiums earned, coupled with an increase of $16.5 million in prior year loss development predominantly driven by attritional losses on the same classes as previously noted for the quarter.

The above increase was offset by the lower current year attritional loss ratio for Casualty mainly due to the change in business mix. As previously noted, we significantly grew General Liability and Multi-line classes at much lower loss ratios than the Workers’ Compensation class.

Other $(6.0) (20.0)
Despite the 29.0% increase in net premiums earned driven from growth in our Marine and Other Specialty classes, the additional losses incurred on this new business was offset by prior year favorable loss development and lower CAT losses. In 2022, the losses relating to the Russian-Ukrainian conflict contributed 14.3 points to the loss ratio.

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Acquisition Costs, Net

~~For the three and nine months ended September 30, 2023, our~~Our total acquisition cost increased by ~~27.5%~~0.3% to ~~$46.9~~$41.6 million, ~~and by 19.4% to $126.7 million, respectively,~~ compared to ~~the same periods in 2022,~~Q1 2023, mainly due to growth in net premiums earned offset partially by lower commissions from excess of loss contracts compared to proportional treaties. The acquisition cost ratios by line of business were as follows:
Three months ended September 30 Nine months ended September 30
2023 2022 Increase / (decrease) in acquisition cost ratio points 2023 2022 Increase / (decrease) in acquisition cost ratio points
Property 17.7 % 19.0 % (1.3) % 18.5 % 22.6 % (4.1) %
Casualty 31.9 31.6 0.3 31.0 28.6 2.4
Other 28.2 30.6 (2.4) 28.2 34.8 (6.6)
Total 28.8 % 30.2 % (1.4) % 28.4 % 29.6 % (1.2) %

~~The changes in~~


	Three months ended March 31
		2024		2023 (1)		Increase / (decrease) in acquisition cost ratio points
Property		19.7	%	19.6	%	0.1	%
Casualty		27.6		30.7		(3.1)
Other		25.0		30.2		(5.2)
Total		25.8	%	29.1	%	(3.3)	%

(1) As a result of the reclassification of certain treaties within the lines of business (see Note 16), the acquisition cost ratios for ~~the three months ended September 30, 2023, compared~~Property, Casualty, and Other were restated accordingly. However, there was no change to the ~~equivalent period~~Total acquisition cost ratio.

The following provides further details on the change in ~~2022, were attributable to the following:~~Q1 2024 vs. Q1 2023.


Change in Acquisition Cost Ratios
Three months ended ~~September 30, 2023~~March 31, 2024
	Increase / (decrease) in acquisition cost ratio points	Explanation
Property	~~(1.3)%~~0.1	The decrease was due primarily to the higher proportion of excess of loss contracts which have a lower ceding commission rate than proportional treaties. Based on net premiums earned for Property, excess of loss contracts accounted for 14% compared to 12% for the same quarter in 2022. No significant change.
Casualty	~~0.3~~(3.1)	The marginal increase was due mainly to changes in our business mix, particularly with an increase in earned premiums from General Liability and Multi-Line (including FAL) classes, which both have a higher ceding commission than the Workers’ Compensation business.
~~Other~~	~~(2.4)~~	The decrease was driven primarily by change in business mix, ~~coupled with~~particularly due to an increase in net premiums earned from general liability and a decrease from multi-line business within Casualty. The multi-line class (including FAL) has a higher ~~proportion of excess~~ceding commission.
Other	(5.2)	The decrease was driven primarily by change in business mix, in which we had lower net premiums earned from the Financial class at higher acquisition costs offset by higher net premiums earned from Other Specialty class at lower acquisition costs. Excess of loss contracts ~~than proportional treaties. Based on~~accounted for 30% of the net premiums earned for Other ~~excess of loss contracts accounted for 31%~~Specialty class in Q1 2024, compared to ~~25% for the same quarter~~28% in ~~2022.~~Q1 2023.

~~The changes in the acquisition cost ratios during the nine months ended September 30, 2023, compared to the equivalent period in 2022, were attributable to the following:~~


~~Change in Acquisition Cost Ratios~~
~~Nine months ended September 30, 2023~~
	~~Increase / (decrease) in acquisition cost ratio points~~	~~Explanation~~
~~Property~~	~~(4.1)%~~	~~Same trends as noted for the three months ended September 30, 2023. Based on net premium earned for Property, excess of loss contracts accounted for 14% compared to 8% for the same period in 2022.~~
~~Casualty~~	~~2.4~~	~~Same trends as noted for the three months ended September 30, 2023.~~
~~Other~~	~~(6.6)~~	~~Same trends as noted for the three months ended September 30, 2023. Based on net premium earned for Other, excess of loss contracts accounted for 31% compared to 25% for the same period in 2022.~~

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Ratio Analysis

The following table provides our underwriting ratios by line of business for the respective periods:


	Three months ended March 31																															Three months ended March 31
	2024																												2024												2023
	Property																				Property				Casualty				Other				Total				Property				Casualty				Other				Total
		Three months ended September 30								Three months ended September 30
		2023								2022
		Property		Casualty		Other		Total		Property		Casualty		Other		Total

Loss ratio
Loss ratio
Loss ratio	Loss ratio	54.1	%	67.4	%	45.6	%	59.4	%	120.1	%	79.6	%	59.4	%	77.5	%	51.3	%			63.4	%			85.7	%			67.7	%			93.4	%			73.1	%			45.6	%			67.8	%
Acquisition cost ratio	Acquisition cost ratio	17.7		31.9		28.2		28.8		19.0		31.6		30.6		30.2
Composite ratio	Composite ratio	71.8	%	99.3	%	73.8	%	88.2	%	139.1	%	111.2	%	90.0	%	107.7	%	Composite ratio	71.0	%			91.0	%			110.7	%			93.5	%			113.0	%			103.8	%			75.8	%			96.9	%
Underwriting expense ratio	Underwriting expense ratio							3.0								7.7
Combined ratio	Combined ratio							91.2	%							115.4	%	Combined ratio																	98.0	%														99.8	%

Nine months ended September 30 Nine months ended September 30
2023 2022
Property Casualty Other Total Property Casualty Other Total
Loss ratio 81.6 % 67.0 % 47.5 % 63.8 % 76.2 % 71.0 % 67.5 % 70.6 %
Acquisition cost ratio 18.5 31.0 28.2 28.4 22.6 28.6 34.8 29.6
Composite ratio 100.1 % 98.0 % 75.7 % 92.2 % 98.8 % 99.6 % 102.3 % 100.2 %
Underwriting expense ratio 3.3 4.6
Combined ratio 95.5 % 104.8 %

~~The~~Our combined ratio improved by 1.8 percentage points in the current quarter compared to Q1 2023 predominantly due to lower acquisition costs ratio; partially offset by an increase in underwriting expense ratio for the three and nine months ended September 30, 2023, compared to the same period in 2022, was driven mainly by 5.0 and 1.7 points, respectively, relating to interest expense on deposit-accounted contracts based on revised expectations of ultimate cash flows in the comparable prior period in 2022.

Excluding the impact of the interest expense on deposit-accounted contracts, our underwriting expenses increased for the three and nine months ended September 30, 2023, over the comparable periods in 2022 primarily due to additional personnel costs (including an increase in accrued incentive compensation costs), professional fees, and outsourced services. Further, for the nine months ended September 30, 2023, we incurred $0.7 million of credit losses relating to certain reinsurance balances receivable and loss recoverable compared to nil in the same period in 2022.

~~General and Administrative Expenses~~

~~Details of general and administrative expenses are provided in the following table for the respective periods:~~

Three months ended September 30 Nine months ended September 30
2023 2022 2023 2022
($ in thousands) ($ in thousands)
Underwriting expenses $ 4,639 $ 3,285 $ 14,046 $ 10,034
Corporate expenses 3,266 4,104 13,820 12,693
General and administrative expenses $ 7,905 $ 7,389 $ 27,866 $ 22,727

For the three months ended September 30, 2023, general and administrative (“G&A”) expenses increased by $0.5 million, or 7.0%, compared to the equivalent 2022 period primarily due to underwriting expenses as previously noted above. Corporate expenses decreased by $0.8 million or 20.4% compared to same period in 2022 mainly due to lower D&O insurance and legal fees.(see G&A ~~expenses included $1.3 million and $1.2 million, of costs related to share-based compensation granted to employees and directors~~Expenses below for ~~the three months ended September 30, 2023 and 2022, respectively. The reversal of share-based compensation relating to forfeited stock awards was insignificant for both periods.~~

further details).

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~~For the nine months ended September 30, 2023,~~General and Administrative (“G&A”) Expenses

The breakdown of our G&A expenses between underwriting and corporate functions was as follows:


	Three months ended March 31
		2024		2023
Underwriting expenses		$	6,339	$	3,939
Corporate expenses		4,375		5,997
General and administrative expenses		$	10,714	$	9,936

G&A increased by ~~$5.1~~7.8% in the current quarter, compared to Q1 2023. The increase was driven by:

•Underwriting expenses: Increased by $2.4 million or ~~22.6%~~60.9%, ~~compared to the equivalent 2022 period,~~ predominantly due to ~~the 40.0%~~an increase in headcount to drive business growth, coupled with an increase in professional fees and outsourced services relating to underwriting ~~expenses as previously noted. Corporate expenses~~activities. As a result, our underwriting expense ratio increased by ~~8.9%~~1.6 percentage points in the current quarter compared to Q1 2023.

•Corporate expenses: Decreased by $1.6 million or 27.0%, driven mainly by ~~the increase in personnel costs, including~~non-recurring severance costs ~~for our former CFO and an increase~~included in accrued incentive compensation costs in light of the Company’s performance in 2023. The incentive compensation cost for the comparative period in 2022 was nil due to the losses suffered in the period. The increase in corporate expenses was partially offset by lower D&O insurance and legal fees. G&A expenses included $3.5 million (net of $0.3 million forfeiture credit) and $3.3 million (net of insignificant forfeiture credit), for the nine months ended September 30,Q1 2023 and ~~2022, respectively,~~lower outside legal costs following the hiring of ~~costs related to share-based compensation granted to employees and directors.~~our new General Counsel in April 2023.

Total Investment Income ~~(Loss)~~

Total investment income (loss) incorporates (i) changes in the net asset value of our investment in SILP managed by DME Advisors, (ii) interest income earned on the restricted cash and cash equivalents pledged as collateral to our clients, and (iii) gains (or losses) and interest on our portfolio of strategic and Innovations investments. We expect our total investment income, including any change in the net asset value of our investment in SILP, to fluctuate from period to period.

A summary of our total investment income ~~(loss)~~ is as ~~follows for the respective periods::~~follows:

Three months ended September 30 Nine months ended September 30
2023 2022 2023 2022
($ in thousands)
Interest and dividend income, net of withholding taxes and other expenses 9,513 2,741 27,004 2,908
Change in unrealized gains and losses relating to Innovations-related investees (2,530) 54 (1,474) 9,237
Investment-related foreign exchange gains (losses) (25) 243 (25) (167)
Realized gains (losses) relating to Innovations-related investees — — (800) —
Net investment-related income (loss) $ 6,958 $ 3,038 $ 24,705 $ 11,978
Income (loss) from investments in related party investment fund (1,853) 8,521 27,791 24,474
Total investment income (loss) $ 5,105 $ 11,559 $ 52,496 $ 36,452


	Three months ended March 31
		2024		2023
Interest and dividend income, net of withholding taxes and other expenses		$	8,556	$	8,628
Net realized and unrealized gains on other investments (see Note 4)		(413)		(250)
Net investment-related income		$	8,143	$	8,378
Share of Solasglas' net income (see Note 3)		18,248		(3,138)
Total investment income		$	26,391	$	5,240

Net investment-related income ~~(loss)~~

Our net investment-related income decreased marginally compared to Q1 2023, driven mostly by an impairment charge relating to our Innovations-related investments.

Share of Solasglas’ net income

For the three months ended September 30, 2023, our net investment-related income increased by $3.9 million or 129.0% compared to same period in 2022 mainly due to the increase in interest income, primarily from our restricted cash and cash equivalents which benefited from rising U.S. interest rates. The U.S. central bank hiked its benchmark borrowing rate 11 times for a total of 5.25 percentage points since March 2022. Partially offsetting this increase, we recognized $2.5 million unrealized losses on our Innovations-related investment as a result of recently completed financing rounds by some of our Innovations investees compared to a small unrealized gain in the same period in 2022.

For the nine months ended September 30, 2023, our net investment-related income increased by $12.7 million or 106.3% compared to the same period in 2023 for the same explanation as noted above. In 2022, our Innovations-related investment benefited from significant unrealized gains driven by favorable pricing conditions from completed financing rounds by some of our Innovations investees.

~~Income from investment in SILP~~

The caption “Income (loss) from investments in related party investment fund” in the above table is net of management fees paid by SILP to DME Advisors and performance compensation, if any, allocated from the Company’s investment in SILP to DME II. No performance compensation is allocated in periods of loss reported by SILP. For further information about management fees and performance compensation for the three and nine months ended September 30, 2023 and 2022, refer to Note 3 of the unaudited condensed consolidated financial statements.

~~For the three months ended September 30, 2023, the Investment Portfolio managed by DME Advisors~~31, 2024, Solasglas reported a ~~loss~~gain of ~~0.6%~~5.2%, compared to a ~~gain~~loss of ~~3.6%~~1.1% for the ~~three months ended September 30, 2022. SILP’s long portfolio lost 4.1%, the short~~

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portfolio gained 1.7%, and macro positions gained 2.8%, during the three months ended September 30, 2023. For the three months ended September 30, 2023, the significant contributors to SILP’s investment return were long positionssame quarter in CONSOL Energy Inc. (CEIX), Capri Holdings as well as from a S&P 500 U.S. interest rate derivative position. The largest detractors were long positions in Green Brick Partners (GRBK) and Tenet Healthcare Corp. as well as one single-name short position.

For the nine months ended September 30, 2023, the Investment Portfolio managed by DME Advisors reported a gain of 9.1%, compared to a gain of 10.5% for the nine months ended September 30, 2022. The long portfolio and macro positions gained 22.8% and 2.6%, respectively, while the short portfolio lost 12.8% during the nine months ended September 30, 2023. The most significant contributors to SILP’s investment return for the nine months ended September 30, 2023 were long positions in GRBK, CEIX, and U.S. interest rate derivative positions. For the same period, the most significant detractors were the hedge position for our GRBK exposure and two single-name short positions.

~~For the three and nine months ended September 30, 2023 and 2022,~~following table provides a breakdown of the gross and net investment ~~return (loss) on our investments managed by DME Advisors (excluding the investment advisor performance allocation) was composed of the following:~~return.


		Three months ended September 30					Nine months ended September 30
		2023		2022			2023		2022
				Three months ended March 31
				Three months ended March 31
				Three months ended March 31
						2024										2024	2023
Long portfolio gains (losses)	Long portfolio gains (losses)	(4.1)	%	6.0	%		22.8	%	(10.5)	%	Long portfolio gains (losses)	4.4	%	8.9	%
Short portfolio gains (losses)	Short portfolio gains (losses)	1.7		(0.1)			(12.8)		21.1
Macro gains (losses)	Macro gains (losses)	2.8		(1.4)			2.6		2.6
Other income and expenses 1	Other income and expenses 1	(1.0)		(0.5)			(2.5)		(1.5)
Gross investment return	Gross investment return	(0.6)	%	4.0	%		10.1	%	11.7	%	Gross investment return	5.7	%	(1.1)	%
Net investment return 1	Net investment return 1	(0.6)	%	3.6	%		9.1	%	10.5	%	Net investment return 1	5.2	%	(1.1)	%

1 “Other income and expenses” excludes performance compensation but includes management fees. “Net investment return” incorporates both of these amounts. For further information about management fees and performance compensation, refer to Note 3.

~~The investment performance for~~

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For the three ~~and nine~~ months ended ~~September 30, 2022 reflects~~March 31, 2024, the ~~Investment Portfolio calculated based on 50% of GLRE Surplus, or the Company's shareholders' equity, as reported~~significant contributors to SILP’s investment return were long positions in ~~the Company’s then most recent quarterly~~Green Brick Partners (GRBK), Tenet Healthcare (THC), and an S&P 500 / U.S. ~~GAAP financial statements adjusted monthly for our share of the net profits~~interest rate derivative position. The largest detractors were long positions in Penn National Gaming (PENN), CONSOL Energy (CEIX), and ~~net losses reported by SILP during any intervening period (the “adjusted GLRE Surplus”). Effective January 1, 2023, the Investment Portfolio is calculated based on 60% of adjusted GLRE Surplus.~~a single-name short position.

Each month, we post on our website (www.greenlightre.com) the returns from our investment in SILP.

~~FINANCIAL CONDITION~~Financial Condition

~~Total investments~~Investments

The following table provides a breakdown of our total investments:


	March 31
	2024				2023
Investment in related party investment fund (SILP)	$	307,138	80.9	%	$	258,890	78.0	%
Other investments:
Private investments and unlisted equities	71,577		18.8		71,157		21.4
Debt and convertible debt securities	1,079		0.3		2,136		0.6

Total other investments	$	72,656	19.1	%	$	73,293	22.0	%

Total investments	$	379,794	100.0	%	$	332,183	100.0	%

At March 31, 2024, our total investments ~~at September 30, 2023 was $296.6~~increased by $47.6 million, ~~compared~~or 14.3%, to ~~$248.5~~$379.8 million atfrom December 31, ~~2022, an increase of $48.2 million, or 19.4%.~~2023. The increase was primarily driven by ~~strong performance from our~~$30.0 million of additional contributions into SILP, ~~portfolio,~~ coupled with the net ~~contributions~~investment return for Q1 2024.

Investments in SILP

DME Advisors reports the composition of SILP’s portfolio on a delta-adjusted basis, which it believes is the appropriate manner to assess the exposure and ~~new Innovation investments. This was partially offset~~profile of investments and reflects how it manages the portfolio. An option’s delta is the option price’s sensitivity to the underlying stock (or commodity) price. The delta-adjusted basis is the number of shares or contracts underlying the option multiplied by the ~~redemption~~delta and the underlying stock (or commodity) price.

The following table represents the composition of SILP’s investments:


	March 31
	2024				2023
	Long %		Short %		Long %		Short %
Equities and related derivatives	83.7		45.6		90.2		53.8
Private and unlisted equity securities	1.8		—		2.0		—
Debt instruments	0.2	%	—		0.3	%	—
Total	85.7	%	45.6	%	92.5	%	53.8	%

The above exposure analysis does not include cash (U.S. dollar and foreign currencies), gold and other commodities, credit default swaps, sovereign debt, foreign currency derivatives, interest rate derivatives, inflation swaps and other macro positions. Under this methodology, a ~~matured term deposit.~~total return swap’s exposure is reported at its full notional amount and options are reported at their delta-adjusted basis. At March 31, 2024, SILP’s exposure to gold on a delta-adjusted basis was 8.7% (Q1 2023: 11.2%).

At ~~September 30, 2023, 93.3%~~March 31, 2024, 95.2% of SILP’s portfolio was valued based on quoted prices in actively traded markets (Level 1), ~~5.0%~~3.4% was composed of instruments valued based on observable inputs other than quoted prices (Level 2), and a nominal amount was composed of instruments valued based on non-observable inputs (Level 3). At ~~September 30, 2023, 1.7%~~March 31, 2024, 1.4% of SILP’s portfolio consisted of private equity funds valued using the funds’ net asset values as a practical expedient.

At September 30, 2023, 82.8% of our Innovations-related portfolio was carried at fair value on a nonrecurring basis, measured as of the investees’ most recently completed financing round, and 17.2% was carried at the original cost.

Other than our investment in SILP (see Note 3 of the accompanying unaudited condensed consolidated financial statements), we have not participated in transactions that created relationships with unconsolidated entities or financial partnerships, including VIEs, established to facilitate off-balance sheet arrangements.

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Other Investments

The other investment holdings relate to private investments made by Innovations. During Q1 2024, we made no new private investments compared to $1.1 million in Q1 2023.

Restricted cash and cash equivalents

We use our restricted cash and cash equivalents primarily for funding trusts and letters of credit issued to our ceding insurers. Our restricted cash decreased by ~~$45.7~~$23.4 million, or ~~6.8%~~3.9%, from ~~$668.3~~$604.6 million at December 31, ~~2022,~~2023, to ~~$622.6~~$581.2 million at ~~September 30, 2023,~~March 31, 2024, primarily due to release of collateral from our ceding insurers relating to legacy contracts in run-off. ~~This was partially offset by the $10.0 million collateral pledged as security for the new Facility (see “Debt” below).~~

Reinsurance balances receivable

~~During the nine months ended September 30, 2023,~~Our reinsurance balances receivable increased by ~~$134.8~~$74.3 million, or ~~26.7%~~12.0%, to ~~$640.4~~$693.7 million from ~~$505.6~~$619.4 million at December 31, ~~2022.~~2023. This increase was ~~related partially~~driven primarily by the renewal of reinsurance treaties, in addition to ~~funds withheld~~new business in Q1 2024.

Loss and LAE Reserves; Loss and LAE Recoverable

Our reserves for loss and LAE by ~~cedents. At September 30, 2023, funds held~~lines of business were as follows:


	March 31, 2024						December 31, 2023
	Case Reserves		IBNR		Total		Case Reserves		IBNR		Total

Property	$	21,302	$	47,212	$	68,514	$	24,181	$	41,056	$	65,237
Casualty	139,602		313,964		453,566		136,713		299,933		436,646
Other	31,159		177,416		208,575		28,156		131,515		159,671
Total	$	192,063	$	538,592	$	730,655	$	189,050	$	472,504	$	661,554

Our total gross loss and LAE reserves increased by ~~cedents were $422.4~~$69.1 million, ~~compared~~or 10.4%, to ~~$337.4~~$730.7 million from $661.6 million at December 31, ~~2022. Funds withheld predominantly relate to premiums withheld by Lloyd’s syndicates and funds contributed~~2023. This increase is primarily driven by the ~~Company to Lloyd's as security for members’ underwriting activities. The remaining~~ increase ~~related to premiums receivable on~~in earned premium from the renewal of reinsurance and new ~~contracts bound, net of collections,~~business, offset partially by paid losses during ~~the nine months ended September 30, 2023.~~

Q1 2024. See Note 7 “

Loss and Loss Adjustment Expense ~~Reserves; Loss and Loss Adjustment Expenses Recoverable~~

Reserves ~~for loss and loss adjustment expenses were composed~~” of the ~~following:~~

September 30, 2023 December 31, 2022
Case
Reserves IBNR Total Case
Reserves IBNR Total
($ in thousands)
Property $ 25,528 $ 50,866 $ 76,394 $ 20,354 $ 41,361 $ 61,715
Casualty 141,446 281,814 423,260 146,702 227,979 374,681
Other 23,147 135,433 158,580 17,700 101,372 119,072
Total $ 190,121 $ 468,113 $ 658,234 $ 184,756 $ 370,712 $ 555,468

During the nine months ended September 30, 2023, the total gross loss and loss adjustment expense reserves increased by $102.8 million, or 18.5%, to $658.2 million from $555.5 million at December 31, 2022. See Note 5 of the accompanying unaudited condensed consolidated financial statements for a summary of changes in outstanding loss and ~~loss adjustment expense~~LAE reserves and a description of prior period loss developments.

~~During the nine months ended September 30, 2023, the~~Our total loss and ~~loss adjustment expenses~~LAE recoverable increased by ~~$15.0~~$19.1 million, or ~~112.9%~~74.3%, to ~~$28.2~~$44.8 million from ~~$13.2~~$25.7 million at December 31, ~~2022.~~2023. This increase was driven mainly by the loss recoveries on the Baltimore bridge loss event. See Note 68 “Retrocession” of the ~~accompanying unaudited condensed consolidated~~ financial statements for a description of the credit risk associated with our retrocessionaires.

Probable Maximum Loss (“PML”)

At ~~October~~April 1, ~~2023,~~2024, our estimated largest ~~probable maximum loss (net of retrocession and reinstatement premiums)~~PML at a ~~1-in-250 year~~1-in-250-year return period for a single event, and in aggregate, was ~~$80.3~~$103.3 million and ~~$87.7~~$111.5 million, respectively, both relating to the peril of North Atlantic Hurricane, compared to ~~$77.5~~$89.7 million and ~~$83.5~~$97.0 million, respectively, at January 1, ~~2023.~~2024. We have increased our PMLs in response to favorable market conditions and attractive opportunities, coupled with higher surplus to remain within our risk management appetite.

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The below table contains the expected modeled loss for each of our peak peril regions and sub-regions for both a single event loss and aggregate loss measures at the ~~1-in-250 year~~1-in-250-year return period.

October 1, 2023

Net 1-in-250 Year Return Period

April 1, 2024

Net 1-in-250 Year Return Period

Peril

Single Event Loss

Aggregate Loss

($ in thousands)

Peril

($ in thousands)

North Atlantic Hurricane

80,342

87,719

Southeast Hurricane

66,060

67,584

Southeast Hurricane

Gulf of Mexico Hurricane

52,287

57,682

Northeast Hurricane

52,968

Northeast Hurricane

North America Earthquake

69,819

74,519

California Earthquake

63,401

67,233

California Earthquake

Pacific Northwest Earthquake

Other N.A. Earthquake

23,810

27,565

Japan Earthquake

36,880

51,754

Japan Earthquake

Japan Windstorm

32,770

35,076

Europe Windstorm

31,941

36,236

Europe Windstorm

Debt

~~During the nine months ended September 30, 2023, our~~

Our total debt decreased by ~~$5.7~~$0.8 million, or ~~7.0%~~1.1%, to ~~$74.9~~$72.5 million from ~~$80.5~~$73.3 million at December 31, 2022. During 2023, we repurchased $17.2 million of Convertible Notes for a marginal realized gain. Further, we repaid the remaining $63.4 million Convertible Notes, including accrued interest, which matured on August 1, 2023. To repay this debt, we entered into a $75.0 million Facility with a group of banks, for which CIBC Bank USA is acting as administrative agent. In connection with this Facility, we contractually agreed to hedge 50% of the floating rate Terms Loans for the duration of the Facility. Refer to ~~Notes 4~~Note 9 “Debt and 7Credit Facilities” of the ~~accompanying unaudited condensed consolidated~~ financial statements for further ~~information on the interest rate swaps used for hedging purposes and the material terms and conditions of the Facility, respectively.~~information.

Total shareholders’ equity

Total shareholders’ equity increased by ~~$72.7~~$28.4 million to ~~$575.9~~$624.5 million, ~~at September 30, 2023,~~ compared to ~~$503.1~~$596.1 million at December 31, ~~2022.~~2023. The increase ~~in shareholders’ equity during the nine months ended September 30, 2023,~~ was primarily due to the net income of ~~$69.2~~$27.0 million reported for the ~~period.~~quarter. For details of other movements in shareholders’ equity, see the ~~accompanying unaudited~~ condensed consolidated statements of shareholders’ equity.

4035

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~~LIQUIDITY AND CAPITAL RESOURCES~~

We anticipate positive cash flows from operations (underwriting activities and investment income) to be sufficient to cover cash outflows under most loss scenarios in the near term. Based on expected cash flows from operations, financing arrangements and redemptions from related party investment fund as needed,~~we believe we have sufficient liquidity to cover our working capital requirements and other contractual obligations and commitments through the foreseeable future.Refer to the “~~Liquidity and Capital Resources

”

Refer to the “Liquidity and Capital Resources” section included in Item 7 of our ~~2022~~2023 Form 10-K for a general discussion of liquidity and capital resources. ~~The following provides an update on material changes to our liquidity and capital resources during the nine months ended September 30, 2023.~~

~~Sources and Uses of Funds~~Liquidity

The following table summarizes our sources and uses of ~~funds for the respective periods:~~funds:


		Nine months ended September 30
		2023		2022		Change
		($ in thousands)
		Three months ended March 31
		Three months ended March 31
		Three months ended March 31
		2024
		2024
		2024
Total cash provided by (used in):
Total cash provided by (used in):
Total cash provided by (used in):	Total cash provided by (used in):
Operating activities	Operating activities	$	(14,630)	$	(27,424)	$	12,794
Operating activities
Operating activities
Investing activities
Investing activities
Investing activities	Investing activities	(22,548)		4,239		(26,787)
Financing activities	Financing activities	(5,292)		(6,419)		1,127
Financing activities
Financing activities
Effect of currency exchange on cash(1)
Effect of currency exchange on cash(1)
Effect of currency exchange on cash(1)	Effect of currency exchange on cash(1)	(152)		(322)		170
Net cash inflows (outflows)	Net cash inflows (outflows)	(42,622)		(29,926)		(12,696)
Net cash inflows (outflows)
Net cash inflows (outflows)
Cash, beginning of period
Cash, beginning of period
Cash, beginning of period	Cash, beginning of period	706,548		711,101		(4,553)
Cash, end of period	Cash, end of period	$	663,926	$	681,175	$	(17,249)
Cash, end of period
Cash, end of period

(1) Cash includes unrestricted and restricted cash and cash equivalents - see Note 25 of the ~~unaudited condensed consolidated~~ financial statements.

Cash ~~used in~~provided by operating activities

The ~~lower use of~~increase in cash ~~in our~~provided by operating activities ~~for the nine months ended September 30, 2023 over the same period in 2022~~ was driven mainly by ~~stronger operating performance,~~$3.0 million improved underwriting income, coupled with the ebb and flow from our underwriting activities, which may vary significantly from period to period depending on the mix of business, the nature of underwriting opportunities available and volume of claims submitted to us by our cedents.

Cash used byin investing activities

During the nine months ended September 30, 2023, we made net contributions of $23.0 million into SILP compared to net redemptions from SILP of $12.9 million during the same period in 2022, which contributed mostly to the $26.8 millionThe increase in cash used for investing activities was driven mainly by ~~investing activities. Partially offsetting this increase,~~the net change in our investment in SILP where we ~~invested $3.1~~made a net contribution of $30.0 million ~~less in Innovations investments for the same period in 2022, coupled with $6.0~~during Q1 2024 compared to a net redemption of $21.0 million ~~proceeds from a matured term deposit.~~during Q1 2023. During Q1 2023, we also made $1.1 million additional Innovations-related investments.

Cash used in financing activities

The decrease in cash used in our financing activities ~~for~~was driven mainly by the ~~nine months ended September 30, 2023 over~~repurchase of a portion of the ~~same period~~outstanding Convertible Notes in ~~2022 was due to drawing fully~~Q1 2023. In Q1 2024, we made the quarterly installment on the new $75.0 million Facility, offset by the repayment of the remaining Convertible Notes on August 1, 2023, in addition to the partial repurchase of these Convertible Notes at a discount earlier in 2023.

~~Cash at September 30, 2023~~

As a result of the above activities, coupled with the foreign exchange rate adjustment on foreign cash, our consolidated cash position declined to $663.9 million at September 30, 2023, from $706.5 million at December 31, 2022.Term Loans.

Capital Resources

The following table summarizes our capital structure:


	March 31, 2024			December 31, 2023
Debt	$	73,125		$	74,062
Shareholders’ equity	624,458			596,095
Total capital	$	697,583		$	670,157

Ratio of debt to shareholders’ equity	11.7		%	12.4		%

The debt to shareholders’ equity provides an indication of our leverage and capital structure, along with some insights into our financial strength. In addition to the above capital, we also have LOC facilities to support our reinsurance business operations where we are not licensed or admitted as a reinsurer.

Our total capital increased in Q1 2024 primarily due to net income for the quarter.

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~~Letters of Credit and Trust Arrangements~~

Ordinary Shares

~~See Note 11~~At March 31, 2024, there were 35,321,144 outstanding ordinary shares, a decrease of ~~the accompanying unaudited condensed consolidated financial statements~~15,588 since December 31, 2023, due to forfeited performance restricted shares net of issuance of ordinary shares for details on the committed and uncommitted letter of credit facilities. We provide collateral to cedents in the form of letters of credit and trust arrangements. At September 30, 2023, the aggregate amount of collateral provided to cedents under such arrangements was $610.2 million (December 31, 2022: $667.6 million). At September 30, 2023, the letters of credit and trust accounts were secured by restricted cash and cash equivalents with a total fair value of $610.9 million (December 31, 2022: $668.3 million).vested RSUs.

~~Contractual Obligations and Commitments~~

~~Since December 31, 2022, the material changes to our contractual obligations and commitments at September 30, 2023 were as follows:~~

Payment due: Less than
1 year 1-3 years 3-5 years More than
5 years Total
($ in thousands)
Loss and loss adjustment expense reserves (1)
$ 326,484 $ 195,495 $ 74,380 $ 61,874 $ 658,234

~~(1)~~Due to the nature of our reinsurance operations, the amount and timing of the cash flows associated with our reinsurance contractual liabilities will fluctuate, perhaps materially, and, therefore, are highly uncertain.

Additionally, we have related party commitments as disclosed in Note 11 of the unaudited condensed consolidated financial statements. At September 30, 2023, we estimate the reduced performance allocation of 10% to continue to be applied until SILP achieves additional investment returns of 117%, at which point the performance allocation will revert to 20%. For detailed breakdowns of management fees and performance compensationWe did not repurchase any ordinary shares for the three ~~and nine~~ months ended ~~September 30, 2023 and 2022, refer to Note 3 of the unaudited condensed consolidated financial statements.~~

~~Capital~~

~~Our capital structure currently consists of debt and equity issued in Ordinary shares - see Financial Condition for further details.~~

On July 25, 2023, at the Company’s Annual General Meeting, the shareholders approved the re-designation of Class B Ordinary shares as Class A Ordinary shares, and the reclassification of Class A Ordinary shares as “Ordinary shares,” resulting in the elimination of the dual-class share structure. At September 30, 2023, there were 35,337,407 outstanding Ordinary shares.March 31, 2024.

We expect that the existing capital base and internally generated funds will be sufficient to implement our business strategy for the foreseeable future. However, to provide us with flexibility and timely access to public capital markets should we require additional capital for working capital, capital expenditures, acquisitions, or other general corporate purposes, we have filed a Form S-3 registration statement, which expires in July 2024.

Secured LOC Facilities

As disclosed in Note 9 “Debt and Credit Facilities” of Q1 2024 Financials, the $275 million committed capacity under the Citi LOC agreement will terminate on August 20, 2024. However, Citi informed the Company that it intends to continue providing the Citi LOC on an uncommitted basis for the foreseeable future following the termination date.

Contractual Obligations and Commitments

At March 31, 2024, our contractual obligations and commitments by period due were as follows:


	Less than 1 year		1-3 years		3-5 years		More than 5 years		Total

Operating activities
Loss and loss adjustment expense reserves (1)	$	347,061	$	231,618	$	86,217	$	65,759	$	730,655
Operating lease obligations	509		1,075		—		—		1,584
Financing activities
Debt (2)	2,813		70,312		—		—		73,125
Total	$	350,383	$	303,005	$	86,217	$	65,759	$	805,364

(1)Due to the nature of our reinsurance operations, the amount and timing of the cash flows associated with our reinsurance contractual liabilities will fluctuate, perhaps materially, and, therefore, are highly uncertain.

(2) See Note 9 “Debt and Credit Facilities” of the financial statements.

~~CRITICAL ACCOUNTING POLICIES AND ESTIMATES~~Critical Accounting Estimates

Our ~~unaudited condensed consolidated~~ financial statements contain certain amounts that are inherently subjective and have required management to make assumptions and best estimates to determine reported values. If certain factors, including those described in “Part II. Item 1A. Risk Factors” included in our ~~2022~~2023 Form 10-K, cause actual events or results to differ materially from our underlying assumptions or estimates. In that case, there could be a material adverse effect on our results of operations, financial condition, or liquidity. The most significant estimates relate to: premium revenues and risk transfer, loss and loss adjustment expense reserves, investment impairments, allowances for credit losses, and share-based compensation.

We believe that the critical accounting estimates discussion in “Part II. Item 7. — Management’s Discussion and Analysis of Financial Condition and Results on Operations” of our ~~2022~~2023 Form 10-K continues to describe the significant estimates and judgments included in the preparation of these ~~unaudited condensed consolidated~~ financial statements.

~~Return to table of contents~~Recent Accounting Pronouncements

~~Recent Accounting Pronouncements~~

At ~~September 30, 2023,~~March 31, 2024, there were no recently issued accounting pronouncements that we have not yet adopted that we expect could have a material impact on our results of operations, financial condition, or liquidity. See Note 2 “Significant Accounting Policies”of theQ1 2024 Financials.

~~EFFECTS OF INFLATION~~

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~~There is no material change to our prior disclosure provided in our 2022 Form 10-K.~~

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

~~We believe we~~Our financial instruments are ~~principally exposed~~subject to a variety of market risks. The term market risk refers to the ~~following types~~risk of ~~market risk:~~ loss arising from adverse changes from:

•

equity price;

•

~~equity price risk;~~commodity price;

•

~~commodity price risk;~~foreign currency; and

•

~~foreign currency risk;~~

•

interest rate ~~risk;~~

•

(including credit ~~risk; and~~

•

~~political risk.~~spreads).

~~See “Part II, Item 7A. Quantitative and Qualitative Disclosures about Market Risk” in our 2022 Form 10-K, for~~We performed a ~~discussion~~sensitivity analysis below to estimate the effects that market risk exposure could have on the future earnings, fair values or cash flows of our ~~exposure to these risks. The following is an update~~financial instruments. These represent forward-looking statements of ~~the material changes in our exposure to~~ market risk ~~at September 30, 2023 since December 31, 2022:~~assuming certain adverse market conditions occur. Actual results in the future may differ materially from these projected results due to actual developments in the global financial markets.

Equity Price Risk

At ~~September 30, 2023,~~March 31, 2024, our investments consisted primarily of an investment in SILP. Among SILP’s holdings are equity securities, the carrying values of which are based primarily on quoted market prices. Generally, market prices of common equity securities are subject to fluctuation, which could cause the amount to be realized upon closing a position to differ significantly from its current reported value. This risk is partly mitigated by the presence of both long and short equity securities as part of SILP’s investment strategy. At March 31, 2024, a 10% decline in the price of each of the underlying listed equity securities and equity-based derivative instruments would result in a ~~$10.5~~$14.4 million (2023: $8.1 million) unrealized loss toin our ~~Investment Portfolio and $3.5 million loss to our proportionate share of the equity exposure held by the Lloyd’s syndicates.~~investment in SILP.

Commodity Price Risk

Generally, market prices of commodities are subject to fluctuation. SILP’s investments periodically include long or short investments in commodities or derivatives directly impacted by fluctuations in the prices of commodities. At March 31, 2024, SILP’s investments incorporate unhedged exposure to changes in gold, copper, uranium, and crude oil prices.

The following table summarizes the net impact that a 10% ~~increase and decrease~~movement in commodity prices would have on the fair value of ~~our Investment Portfolio at September 30, 2023.~~SILP’s investment portfolio. The below table excludes the indirect effect that changes in commodity prices might have on equity securities in ~~our Investment Portfolio.~~the SILP’s investment portfolio.

10% increase in commodity prices

10% decrease in commodity prices

Commodity

Change in
fair value

($ in millions)

10% increase in commodity prices

March 31, 2024

Gold

3.3

(3.3)

Silver

0.3

(0.3)

Gold

Copper

Uranium

0.6

(0.6)

Crude oil

0.3

(0.3)

Crude oil

Total

4.5

(4.5)

Total


	10% increase in commodity prices		10% decrease in commodity prices
December 31, 2023	($ in millions)
Gold	$	3.8	$	(3.8)


Uranium	0.8		(0.8)
Crude oil	1.6		(1.5)
Total	$	6.2	$	(6.1)

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Foreign Currency Risk

Underwriting Related

Certain of our reinsurance contracts are denominated in foreign currencies, whereby premiums are receivable and losses are payable in foreign currencies. Foreign currency exchange rate risk exists to the extent that our foreign currency reinsurance balances are more than (or less than) the corresponding foreign currency cash balances, and there is an increase (or decrease) in the exchange rate of that foreign currency.

While we do not seek to precisely match our liabilities under reinsurance policies that are payable in foreign currencies with investments denominated in such currencies, we continually monitor our exposure to potential foreign currency losses and may use foreign currency cash and cash equivalents or forward foreign currency exchange contracts to mitigate against adverse foreign currency movements.

Certain cedents, particularly the Lloyd’s syndicates, report to us in foreign currencies even though some or all of the underlying exposure is denominated in U.S. dollars. Our condensed consolidated statements of operations may report a foreign exchange gain or loss associated with this exposure when reported by the cedents. Additionally, we may report foreign exchange gains or losses due to the mismatch between the currency exchange rates applied to foreign-denominated (i) monetary balances and (ii) non-monetary balances under U.S. GAAP. See Note 2 of the accompanying financial statements for further information regarding our accounting treatment of foreign currency transactions.

We monitor our foreign currency-denominated assets and liabilities on an “underlying exposure” basis without distinguishing between monetary and non-monetary balances.

The following table summarizes the net impact of a hypothetical 10% currency rate movement relating to our ~~main~~primary foreign denominated reinsurance net assets or liabilities (including balances held at Lloyd's) ~~at September 30, 2023:~~:

~~Return to table of contents~~


Currency		Net Exposure		10% increase in currency rate		10% decrease in currency rate
		($ in thousands)
March 31, 2024								March 31, 2024	Net Asset (Liability) Exposure	10% increase in currency rate	10% decrease in currency rate
GBP	GBP	£	10,263	$	1,252	$	(1,252)
Euro	Euro	€	(12,547)	(1,326)		1,326
Total foreign exchange loss (gain)				$	(74)	$	74
Total foreign exchange gain (loss)

~~Additionally,~~


December 31, 2023	Net Asset (Liability) Exposure		10% increase in currency rate		10% decrease in currency rate
GBP	£	25,337	$	(3,228)	$	3,228
Euro	€	(13,975)	1,543		(1,543)
Total foreign exchange gain (loss)			$	(1,685)	$	1,685

Investment in SILP

We may also be exposed to foreign currency risk through SILP’s underlying cash, forwards, options, and investments in securities denominated in foreign currencies. At March 31, 2024, most of SILP’s currency exposures resulting from foreign-denominated securities (longs and shorts) were reduced by offsetting cash balances denominated in the corresponding foreign currencies.

At March 31, 2024 and 2023, a 10% increase or decrease in the value of the U.S. dollar against foreign currencies would have no meaningful impact on ~~the value of~~ our ~~Investment Portfolio at September 30, 2023.~~investment in SILP.

Interest Rate Risk

~~There was no material change in~~The primary market risk exposure for any debt instrument is interest rate risk, including credit spreads. Most of our ~~exposure~~interest rate risk relates to interest rate ~~risk at September 30, 2023 since December 31, 2022, except for:~~derivatives held in SILP, and their value may fluctuate with changes in interest rates.

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•~~Our Term Loans are subject to interest rate variability based on SOFR plus 3.5% per annum, of which 50% is hedged by interest rate swaps.~~ At ~~September 30, 2023, a 100 basis points change (increase or decrease) in interest rates would result in a $0.4 million change to~~March 31, 2024, our ~~interest expense for the unhedged portion of the Term Loans.~~

•~~Our~~ investment in SILP includes interest-rate sensitive securities, such as corporate and sovereign debt instruments and interest rate derivatives. ~~At September 30, 2023, a~~A 100 basis points ~~increase~~change (increase or ~~decrease~~decrease) in interest rates would result in a ~~$12.0~~$14.0 million gain (December 31, 2023: $1.6 million) or a ~~$11.9~~$2.5 million (December 31, 2023: $3.5 million) loss, respectively, to our ~~Investment Portfolio.~~investment in SILP.

We, along with DME Advisors, monitor the net exposure to interest rate risk and generally do not expect changes in interest rates to have a materially adverse impact on our operations.

Item 4. CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

As required by Rules 13a-15 and 15d-15 of the Exchange Act, the Company has evaluated, with the participation of management, including the Chief Executive Officer and the Chief Financial Officer, the effectiveness of its disclosure controls and procedures (as defined in such rules) as of the end of the period covered by this report. Based on such evaluation, the Chief Executive Officer and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports prepared in accordance with the rules and regulations of the SEC is recorded, processed, summarized and reported within the time periods specified by the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and communicated to the issuer’s management, including its principal executive officer and principal financial officer, or persons performing similar functions, as appropriate, to allow timely decisions regarding required disclosure.

Our management, including our Chief Executive Officer and Chief Financial Officer, does not expect that the Company’s disclosure controls and procedures will prevent all errors and all frauds. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake.

Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls. The design of any system of controls also is based, in part, upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with the policies or procedures may deteriorate. Because of the inherent limitations in a cost-effective control system, misstatements due to error or fraud may occur and not be detected.

~~Return to table of contents~~

Changes in Internal Control Over Financial Reporting

There have been no changes in the Company’s internal control over financial reporting during the fiscal quarter ended ~~September 30, 2023~~March 31, 2024 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting. The Company continues to review its disclosure controls and procedures, including its internal controls over financial reporting, and may from time to time make changes aimed at enhancing their effectiveness and to ensure that the Company’s systems evolve with its business.

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PART II — OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

From time to time, in the normal course of business, we may be involved in formal and informal dispute resolution procedures, which may include arbitration or litigation, the outcomes of which determine our rights and obligations under our reinsurance contracts and other contractual agreements. In some disputes, we may seek to enforce our rights under an agreement or to collect funds owing to us. In other matters, we may resist attempts by others to collect funds or enforce alleged rights. While the final outcome of legal disputes cannot be predicted with certainty, we do not believe that any of our existing contractual disputes, when finally resolved, will have a material adverse effect on our business, financial condition or operating results.

Item 1A. RISK FACTORS

Factors that could cause our actual results to differ materially from those in this report are any of the risks described in “Part I. Item 1A. Risk Factors” included in our ~~2022~~2023 Form 10-K, as filed with the SEC on March ~~8, 2023.~~5, 2024. Any of these factors could result in a significant or material adverse effect on our results of operations or financial condition. Additional risk factors not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

As of ~~September 30, 2023,~~March 31, 2024, there have been no other material changes to the risk factors disclosed in “Part I. Item 1A. Risk Factors” included in our ~~2022~~2023 Form 10-K. We may disclose changes to such factors or disclose additional factors from time to time in our future filings with the SEC.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

Our Board ~~of Directors~~ has adopted a share repurchase ~~plan authorizing~~plan. The timing of such repurchases and the ~~Company to repurchase ordinary shares. From time to time, the repurchase plan has been re-approved or modified at the election~~actual number of ~~our Board of Directors.~~shares repurchased will depend on various factors, including price, market conditions, and applicable regulatory and corporate requirements. On May ~~2, 2023, the~~3, 2024, our Board of Directors re-approved the share repurchase plan ~~effective from July 1, 2023,~~ until June 30, ~~2024,~~2025, authorizing ~~the Company~~us to repurchase up to $25.0 million of ordinary shares or securities convertible into ordinary shares in the open market, through privately negotiated transactions or Rule 10b5-1 stock trading ~~plans (as defined in Item 408(a) of Regulation S-K).~~plans.

~~The Company is~~Any shares repurchased are canceled immediately upon repurchase. We are not required to repurchase any of the ordinary ~~shares and the~~shares. The repurchase plan may be modified, suspended, or terminated at the election of our Board of Directors at any time without prior notice. ~~During~~

There were no share repurchases made under the ~~quarter~~plan during the three months ended ~~September 30, 2023, there was no repurchase of ordinary shares.~~March 31, 2024.

Item 3. DEFAULTS UPON SENIOR SECURITIES

None.

Item 4. MINE SAFETY DISCLOSURES

Not applicable.

Item 5. OTHER INFORMATION

Our directors and executive officers may purchase or sell shares of our ordinary shares in the market from time to time, including pursuant to equity trading plans adopted in accordance with Rule 10b5-1 under the Exchange Act (“Rule 10b5-1”) and in compliance with guidelines specified by the Company. In accordance with Rule 10b5-1 and our insider trading policy, directors, officers, and certain employees who, at such time, are not in possession of material non-public information about the Company are permitted to enter into written plans that pre-establish amounts, prices and dates (or formula for determining the amounts, prices and dates) of future purchases or sales of the Company’s stock, including shares acquired pursuant to the Company’s equity plans (“Rule 10b5-1 Trading Plans”). Under Rule 10b5-1 Trading Plan, a broker executes trades pursuant to parameters established by the director or executive officer when entering into the plan, without further direction from them.

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During the three months ended ~~September 30, 2023,~~March 31, 2024, we did not have any “Rule 10b5-1 trading ~~arrangements”~~arrangements or any “non-Rule 10b5-1 arrangements” ~~(in each case, as~~(as defined in Item 408(a) of Regulation S-K) in place for our directors and officers.

Item 6. EXHIBITS


~~3.1~~			~~Fourth Amended and Restated Memorandum and Articles of Association of the Company (incorporated by reference to Exhibit 3.1 of the Company’s Form 8-K filed on July 27, 2023).~~
31.1			Certification of the Chief Executive Officer filed hereunder pursuant to Section 302 of the Sarbanes Oxley Act of 2002
31.2			Certification of the Chief Financial Officer filed hereunder pursuant to Section 302 of the Sarbanes Oxley Act of 2002
32.1			Certification of the Chief Executive Officer filed hereunder pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (*)
32.2			Certification of the Chief Financial Officer filed hereunder pursuant to Section 906 of the Sarbanes Oxley Act of 2002 (*)
101			The following materials from the Company’s Quarterly Report on Form 10-Q for the three ~~and nine~~ months ended ~~September 30, 2023~~March 31, 2024 formatted in Inline XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Balance Sheets; (ii) the Condensed Consolidated Statements of Operations; (iii) the Condensed Consolidated Statements of Changes in Shareholders’ Equity; (iv) the Condensed Consolidated Statements of Cash Flows; and (v) the Notes to Condensed Consolidated Financial Statements.
104			Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


			* Furnished herewith.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.


			GREENLIGHT CAPITAL RE, LTD.
			(Registrant)
			By:			/s/ ~~SIMON BURTON~~ GREGORY RICHARDSON
						~~Simon Burton~~Gregory Richardson Director and Chief Executive Officer (principal executive officer)
						~~November~~May 8, ~~2023~~2024

			By:			/s/ FARAMARZ ROMER
						Faramarz Romer Chief Financial Officer (principal financial and accounting officer)
						~~November~~May 8, ~~2023~~2024

4642


Payment due:	Less than 1 year		1-3 years		3-5 years		More than 5 years		Total
	($ in thousands)

Loss and loss adjustment expense reserves (1)	$	326,484	$	195,495	$	74,380	$	61,874	$	658,234