Except for the historical information included and incorporated by reference in this Quarterly Report on Form 10-Q, the information included and incorporated by reference herein are “forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements provide our current expectations or forecasts of future events and are not statements of historical fact. These forward-looking statements include information about possible or assumed future events, including, among other things, discussion and analysis of our future financial condition, results of operations and our strategic plans and objectives. When we use words such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “seek,” “may,” “might,” “plan,” “project,” “should,” “target,” “will,” or similar expressions, we intend to identify forward-looking statements.

Forward-looking statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, many of which are beyond our control, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of various factors, including, but not limited to, those described in the section entitled “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020,~~2021, in this Quarterly Report on Form 10-Q and in our other public filings with the SEC.

The factors described herein are not necessarily all of the important factors that could cause actual results or developments to differ materially from those expressed in any of our forward-looking statements. Other unknown or unpredictable factors also could affect our forward-looking statements. Consequently, our actual performance could be materially different from the results described or anticipated by our forward-looking statements. Given these uncertainties, you should not place undue reliance on these forward-looking statements. Except as required by the applicable law, we undertake no obligation to update any forward-looking statements.

Certain market data and industry data included in this Quarterly Report on Form 10-Q were obtained from reports of governmental agencies and industry publications and surveys. We believe the data from third-party sources to be reliable based upon our management’s knowledge of the industry, but have not independently verified such data and as such, make no guarantees as to its accuracy, completeness or timeliness.

Tiptree Inc. (together with its consolidated subsidiaries, collectively, Tiptree, the Company, or we) is a Maryland Corporation that was incorporated on March 19, 2007. Tiptree’s common stock trades on the Nasdaq Capital Market under the symbol “TIPT”. Tiptree is a holding company that ~~combines specialty insurance operations with investment management capabilities. We allocate our~~allocates capital across ~~our insurance operations~~a broad spectrum of businesses, assets and other investments. We classify our business into 2 reportable segments: Insurance and Mortgage. We refer to our non-insurance operations, assets and other investments, which is comprised of our Mortgage reportable segment and our non-reportable segments and other business activities, as Tiptree Capital.

The accompanying unaudited condensed consolidated financial statements of Tiptree have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) and include the accounts of the Company and its subsidiaries. The condensed consolidated financial statements are presented in U.S. dollars, the main operating currency of the Company. The unaudited condensed consolidated financial statements presented herein should be read in conjunction with the annual audited financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. In the opinion of management, the accompanying unaudited interim financial information reflects all adjustments, including normal recurring adjustments necessary to present fairly the Company’s financial position, results of operations, comprehensive income and cash flows for each of the interim periods presented. The results of operations for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 are not necessarily indicative of the results that may be expected for the full year ending on December 31, ~~2021.~~2022.

Non-controlling interests on the condensed consolidated balance sheets represent the ownership interests in certain consolidated subsidiaries held by entities or persons other than Tiptree. Accounts and transactions between consolidated entities have been eliminated.

During the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, there were no accounting standards issued applicable to the Company.

Luxury’s earnings had no impact to net income (loss) attributable to common stockholders for the three months ended March 31, 2022 and 2021.

In March 2022, the Company entered into a definitive agreement to sell a vessel from its maritime shipping operations for a price of $21,500, and the vessel and related assets are classified as held for sale at March 31, 2022. There are no related liabilities. The agreement did not meet the requirements to be classified as a discontinued operation. We expect the sale to be completed in the second quarter of 2022. The following table presents detail of the assets held for sale in the condensed consolidated balance sheets for March 31, 2022:

Tiptree is a holding company that allocates capital across a broad spectrum of businesses, assets and other investments. Tiptree’s principal operating subsidiary, The Fortegra Group, LLC and its subsidiaries (Fortegra), is a leading provider of specialty insurance, ~~underwriting, warranty and~~ service contract products and related service solutions. Based on the ASC 280 quantitative analysis performed as of December 31, ~~2020,~~2021, our reportable segments are Insurance and Mortgage. We refer to our non-insurance operations, assets and other investments, which is comprised of our Mortgage reportable segment and our non-reportable

operating segments and other business activities, as Tiptree Capital. Corporate activities include holding company interest expense, employee compensation and benefits, and other expenses.

Our reportable segments’ income or loss is reported before income taxes and non-controlling interests. Segment results incorporate the revenues and expenses of these subsidiaries since they commenced operations or were acquired. For the three and nine months ended September 30, 2021, Mortgage has been broken out of Tiptree Capital as a reportable segment since it meets the quantitative threshold for disclosure. Prior year segments have been conformed to the current year presentation. Intercompany transactions are eliminated.

Descriptions of our Insurance reportable segment and Tiptree Capital, including our Mortgage reportable segment, are as follows:

The tables below present the components of revenue, expense, income (loss) before taxes, and assets for our reportable segments as well as Tiptree Capital - Other for the following periods:

The following table presents the reportable segments and Tiptree Capital - Other assets for the following periods:

The following table presents the Company's investments related to insurance operations and other Tiptree investing activities, measured at fair value as of the following periods:

All of the Company’s investments in Available for Sale Securities, at fair value, net of allowance for credit losses (AFS securities) as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020~~2021 are held by subsidiaries in the insurance segment. The following tables present the Company's investments in AFS securities:

The amortized cost and fair values of AFS securities, by contractual maturity date, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties.

The following tables present the gross unrealized losses on AFS securities by length of time that individual AFS securities have been in a continuous unrealized loss position for less than twelve months, and twelve months or greater and do not have an allowance for credit losses:

Management believes that it is more likely than not that the Company will be able to hold the fixed maturity AFS securities that were in an unrealized loss position as of ~~September 30, 2021~~March 31, 2022 until full recovery of their amortized cost basis.

The table below presents a roll-forward of the activity in the allowance for credit losses on AFS securities by type as of ~~September 30, 2021:~~March 31, 2022:

The Company applies a discounted cash flow model, based on assumptions and model outputs provided by an investment management company, in determining its lifetime expected credit losses on AFS securities. This includes determining the present value of expected future cash flows discounted at the book yield of the security.

The table below presents the amount of ~~credit losses (gains~~gains from ~~recoveries)~~recoveries (credit losses) on AFS securities recorded by the Company for the following period:

Pursuant to certain reinsurance agreements and statutory licensing requirements, the Company has deposited invested assets in custody accounts or insurance department safekeeping accounts. The Company cannot remove or replace investments in regulatory deposit accounts without prior approval of the contractual party or regulatory authority, as applicable. The following table presents the Company's restricted investments included in the Company's AFS securities:

The following table presents additional information on the Company’s AFS securities:

The following table presents the gross realized gains and gross realized losses from sales and redemptions of AFS securities:

The following table presents the Company’s investments in loans measured at fair value and the Company’s investments in loans measured at fair value pledged as collateral:

Equity securities consist mainly of publicly traded common and preferred stocks and fixed income exchange traded funds. Included within the equity securities balance are 17.0 million shares of Invesque as of ~~September 30, 2021~~March 31, 2022 and December 31, ~~2020,~~2021, for which the Company has elected to apply the fair value option. The following table presents information on the cost and fair value of the Company’s equity securities related to insurance operations and other Tiptree investing activity as of the following periods:

The following table contains information regarding the Company’s other investments as of the following periods:

Net investment income represents investment income and expense from investments related to insurance operations as disclosed within net investment income on the ~~condensed~~ consolidated statements of operations. The following table presents the components of net investment income by source of income:

Other investment income represents other revenue from other Tiptree non-insurance activities as disclosed within other revenue on the condensed consolidated statements of operations, see Note ~~(16)~~(15) Other Revenue and Other Expenses. The following tables present the components of other investment income by type:

The following table presents the components of net realized and unrealized gains (losses) recorded on the condensed consolidated statements of operations. Net unrealized gains (losses) on AFS securities are included within other comprehensive income (loss) ~~(OCI)~~(“OCI”), net of tax, and, as such, are not included in this table. Net realized and unrealized gains (losses) on non-investment related financial assets and liabilities are included below:

The following table presents the effect of reinsurance on premiums written and earned by our insurance business for the following periods:

The following table presents the components of policy and contract benefits, including the effect of reinsurance on losses and loss adjustment expenses (LAE) incurred:
Direct amount Ceded to other companies Assumed from other companies Net amount Percentage of amount - assumed to net
For the Three Months Ended September 30, 2021
Losses and LAE Incurred
Life insurance                   $ 13,398 $ 7,610 $ 116 $ 5,904 2.0 %
Accident and health insurance    6,689 5,691 913 1,911 47.8 %
Property and liability insurance 90,094 57,568 20,911 53,437 39.1 %
Total losses and LAE incurred 110,181 70,869 21,940 61,252 35.8 %
Member benefit claims (1)
19,579
Total policy and contract benefits $ 80,831
For the Three Months Ended September 30, 2020
Losses and LAE Incurred
Life insurance                   $ 12,945 $ 7,505 $ 135 $ 5,575 2.4 %
Accident and health insurance    5,854 4,922 1,436 2,368 60.6 %
Property and liability insurance 78,206 56,500 13,271 34,977 37.9 %
Total losses and LAE incurred 97,005 68,927 14,842 42,920 34.6 %
Member benefit claims (1)
14,818
Total policy and contract benefits $ 57,738
For the Nine Months Ended September 30, 2021
Losses and LAE Incurred
Life insurance $ 40,940 $ 23,987 $ 481 $ 17,434 2.8 %
Accident and health insurance 16,608 13,607 2,232 5,233 42.7 %
Property and liability insurance 262,447 180,991 77,121 158,577 48.6 %
Total losses and LAE incurred 319,995 218,585 79,834 181,244 44.0 %
Member benefit claims (1)
55,954
Total policy and contract benefits $ 237,198
For the Nine Months Ended September 30, 2020
Losses and LAE Incurred
Life insurance $ 33,600 $ 19,493 $ 416 $ 14,523 2.9 %
Accident and health insurance 13,471 11,225 5,458 7,704 70.8 %
Property and liability insurance 204,917 133,798 32,008 103,127 31.0 %
Total losses and LAE incurred 251,988 164,516 37,882 125,354 30.2 %
Member benefit claims (1)
42,407
Total policy and contract benefits $ 167,761

The following table presents the aggregate amount included in reinsurance receivables that is comprised of the three largest receivable balances from non-affiliated reinsurers:

As of ~~September 30, 2021,~~March 31, 2022, the non-affiliated reinsurers from whom our insurance business has the largest receivable balances were: ~~MFI Insurance Company, LTD~~Allianz Global Corporate & Specialty SE (A. M. Best Rating: ~~Not~~A+ rated), ~~Allianz Global (A. M. Best Rating: Not rated) and~~ Canada Life International Reinsurance ~~(Barbados)~~(Bermuda) Corporation (A. M. Best Rating: ~~Not~~A+ rated), and Canada Life Assurance Company (A. M. Best Rating: A+ rated). The related receivables of these reinsurers are collateralized by assets on hand, assets held in trust accounts and letters of credit. As of ~~September 30, 2021,~~March 31, 2022, the Company does not believe there is a risk of loss due to the concentration of credit risk in the reinsurance program given the collateralization.

The following table presents identifiable finite and indefinite-lived intangible assets, accumulated amortization, and goodwill by operating segment and/or reporting unit, as appropriate:

The following table presents the activity in goodwill, by operating segment and/or reporting unit, as appropriate, and includes the adjustments made to the balance of goodwill to reflect the effect of the final valuation adjustments made for acquisitions, as well as the reduction to any goodwill attributable to impairment related charges:

The Company conducts annual impairment tests of its goodwill as of October 1. For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ no impairments were recorded on the Company’s goodwill.

The following table presents the activity, by operating segment and/or reporting unit, as appropriate, in finite and indefinite-lived other intangible assets and includes the adjustments made to the balance to reflect the effect of any final valuation adjustments made for acquisitions, as well as any reduction attributable to impairment-related charges:

The following table presents the amortization expense on finite-lived intangible assets for the following periods:

For the three ~~and nine~~ months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020,~~ no impairments were recorded on the Company’s intangible assets.

The following table presents the amortization expense on finite-lived intangible assets for the next five years and thereafter by operating segment and/or reporting unit, as appropriate:

The Company utilizes derivative financial instruments as part of its overall investment and hedging activities. Derivative contracts are subject to additional risk that can result in a loss of all or part of an investment. The Company’s derivative activities are primarily classified by underlying credit risk and interest rate risk. In addition, the Company is also subject to additional counterparty risk should its counterparties fail to meet the contract terms. The derivative financial instruments are reported in other investments. Derivative liabilities are reported within other liabilities and accrued expenses.

The Company enters into interest rate lock commitments ~~(IRLCs)~~(“IRLCs”) with customers in connection with its mortgage banking activities to fund residential mortgage loans with certain terms at specified times in the future. IRLCs that relate to the origination of mortgage loans that will be classified as held-for-sale are considered derivative instruments under applicable accounting guidance. As such, these IRLCs are recorded at fair value with changes in fair value typically resulting in recognition of a gain when the Company enters into IRLCs. In estimating the fair value of an IRLC, the Company assigns a probability that the loan commitment will be exercised and the loan will be funded (“pull through”). The fair value of the commitments is derived from the fair value of related mortgage loans, net of estimated costs to complete. Outstanding IRLCs

expose the Company to the risk that the price of the loans underlying the commitments might decline from inception of the rate lock to funding of the loan. To manage this risk, the Company utilizes forward delivery contracts and to be announced ~~(TBA)~~(“TBA”) mortgage backed securities to economically hedge the risk of potential changes in the value of the loans that would result from the commitments.

The Company enters into forward delivery contracts with loan aggregators and other investors as one of the tools to manage the interest rate risk associated with IRLCs and loans held for sale. In addition, the Company enters into TBA mortgage backed securities which facilitate hedging and funding by allowing the Company to prearrange prices for mortgages that are in the process of originating. The Company utilizes these hedging instruments for Agency (Fannie Mae and Freddie Mac) and FHA/VA (Ginnie Mae) eligible IRLCs.

~~F - 25~~

The following table presents the balance of the Company’s debt obligations, net of discounts and deferred financing ~~costs.~~costs for our corporate and asset based debt. Asset based debt is generally recourse only to specific assets and related cash flows.

The following table presents the contractual principal payments and future maturities of the unpaid principal balance on the Company’s debt for the following periods:

As of March 31, 2022 and December 31, 2021, a total of $0 and $2,160, respectively, was outstanding under the revolving line of credit in our insurance business. The maximum borrowing capacity under the agreements as of March 31, 2022 was $200,000.

As of March 31, 2022, a total of $48,551 was outstanding under the under the borrowing related to our premium finance and service contract finance businesses in our insurance business.

In ~~March 2021, a~~April 2022, subsequent to the end of the quarter, the $60,000 warehouse line of credit was renewed and the maturity date was extended from April ~~2021~~2022 to April ~~2022. In July 2021, a $50,000 warehouse line of credit was renewed and the maturity date was extended from August 2021 to August 2022.~~2023.

As of ~~September 30,~~March 31, 2022 and December 31, 2021, a total of $67,990 and $72,518, respectively, was outstanding under such financing agreements.

As of March 31, 2022 and December 31, 2021, the maximum borrowing capacity and borrowings outstanding were $13,050 and $13,600, respectively.

As of March 31, 2022, the Company iswas in compliance with the representations and covenants for its outstanding debt or ~~has~~ obtained waivers for any events of non-compliance.

The Company maximizes the use of observable inputs and minimizes the use of unobservable inputs to the extent possible to measure a financial instrument’s fair value. Observable inputs reflect the assumptions market participants would use in pricing an asset or liability, and are affected by the type of product, whether the product is traded on an active exchange or in the secondary market, as well as current market conditions. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based

on the lowest level input that is significant to the fair value measurement in its entirety. Fair value is estimated by applying the hierarchy discussed in Note (2) Summary of Significant Accounting Policies which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized within Level 3 of the fair value hierarchy.

The Company’s fair value measurements are based primarily on a market approach, which utilizes prices and other relevant information generated by market transactions involving identical or comparable financial instruments. Sources of inputs to the market approach include third-party pricing services, independent broker quotations and pricing matrices. Management analyzes the third-party valuation methodologies and its related inputs to perform assessments to determine the appropriate level within the fair value hierarchy and to assess reliability of values. Further, management has a process in place to review all changes in fair value that occurred during each measurement period. Any discrepancies or unusual observations are followed through to resolution through the source of the pricing as well as utilizing comparisons, if applicable, to alternate pricing sources.

The Company utilizes observable and unobservable inputs within its valuation methodologies. Observable inputs may include: benchmark yields, reported trades, broker-dealer quotes, issuer spreads, benchmark securities, bids, offers and reference data. In addition, specific issuer information and other market data is used. Broker quotes are obtained from sources recognized to be market participants. Unobservable inputs may include: expected cash flow streams, default rates, supply and demand considerations and market volatility.

The fair values of AFS securities are based on prices provided by an independent pricing service and a third-party investment manager. The Company obtains an understanding of the methods, models and inputs used by the independent pricing service and the third-party investment manager by analyzing the investment manager-provided pricing report.

The following details the methods and assumptions used to estimate the fair value of each class of AFS securities and the applicable level each security falls within the fair value hierarchy:

The fair values of publicly traded common and preferred equity securities and exchange traded funds (“ETFs”) are obtained from market value quotations provided by an independent pricing service and fall under Level 1 in the fair value hierarchy. The fair values of non-publicly traded common and preferred stocks are based on prices obtained from an independent pricing service using unobservable inputs and fall under Level 3 in the fair value hierarchy.

Derivatives are primarily comprised of IRLCs, forward delivery contracts and TBA mortgage backed securities. The fair value of these instruments is based upon valuation pricing models, which represent the amount the Company would expect to receive or pay at the balance sheet date to exit the position. Our mortgage origination subsidiaries issue IRLCs to their customers, which are carried at estimated fair value on the Company’s condensed consolidated balance sheets. The estimated fair values of these commitments are generally calculated by reference to the value of the underlying loan associated with the IRLC net of costs to produce and an expected pull through assumption. The fair values of these commitments generally fall under Level 3 in the fair value hierarchy. Our mortgage origination subsidiaries manage their exposure by entering into forward delivery commitments with loan investors. For loans not locked with investors under a forward delivery commitment, the Company enters into hedge instruments, primarily TBAs, to protect against movements in interest rates. The fair values of TBA mortgage backed securities and forward delivery contracts generally fall under Level 2 in the fair value hierarchy.

Corporate bonds are generally classified under Level 2 in the fair value hierarchy and fair value is provided by a third-party investment manager, based on quoted market prices. We perform internal price verification procedures monthly to ensure that the prices provided are reasonable.

Securities sold, not yet purchased are generally classified under Level 1 or Level 2 in the fair value hierarchy, based on the leveling of the securities sold short, and fair value is provided by a third-party investment manager, based on quoted market prices. We perform internal price verification procedures monthly to ensure that the prices provided are reasonable.

Mortgage servicing rights are classified under Level 3 in the fair value hierarchy and fair value is provided by a third-party valuation service. Various observable and unobservable inputs are used to determine fair value, including discount rate, cost to service and weighted average prepayment speed.

The following tables present the Company’s fair value hierarchies for financial assets and liabilities, measured on a recurring basis:

Transfers between Level 2 and 3 were a result of subjecting third-party pricing on assets to various liquidity, depth, bid-ask spread and benchmarking criteria as well as assessing the availability of observable inputs affecting their fair valuation.

The following table presents additional information about assets that are measured at fair value on a recurring basis for which the Company has utilized Level 3 inputs to determine fair value for the following periods:

The following table presents the range and weighted average (WA) used to develop significant unobservable inputs for the fair value measurements of Level 3 assets and liabilities.

The following table presents the carrying amounts and estimated fair values of financial assets and liabilities that are not recorded at fair value and their respective levels within the fair value hierarchy:

Additionally, the following financial assets and liabilities on the condensed consolidated balance sheets are not carried at fair value, but whose carrying amounts approximate their fair value:

The following table presents the activity in the net liability for unpaid losses and allocated loss adjustment expenses of short duration contracts for the following periods:

The following schedule reconciles the total short duration contracts per the table above to the amount of total losses incurred as presented in the condensed consolidated statements of operations, excluding the amount for member benefit claims:

The Company’s revenues from insurance and ~~warranty~~contractual and liability insurance operations are primarily accounted for under Financial Services-Insurance (Topic 944) that are not within the scope of Revenue for Contracts with Customers (Topic 606). The Company’s remaining revenues that are within the scope of Topic 606 are primarily comprised of revenues from contracts with customers for monthly membership dues for motor clubs, monthly administration fees for services provided for premiums, claims and reinsurance processing revenues, vehicle service contracts, vessel related revenue and ~~warranty coverage~~ revenues for household goods and appliances service contracts (collectively, remaining contracts).

The following table presents the disaggregated amounts of revenue from contracts with customers by product type for the following periods:

Service fee revenue is recognized as the services are performed. These services include fulfillment, software development, and claims handling for our customers. Management reviews the financial results under each significant contract on a monthly basis. Any losses that may occur due to a specific contract would be recognized in the period in which the loss is determined probable.

Administrative fee revenue includes the administration of premium associated with our producers and ~~their producer owned reinsurance companies (PORCs).~~PORCs. In addition, we also earn fee revenue from debt cancellation, ~~programs,~~ motor club, ~~programs,~~ and ~~warranty programs.~~auto and consumer goods service contracts. Related administrative fee revenue is recognized consistent with the earnings recognition pattern of the underlying insurance policies, debt cancellation contracts and motor club memberships being administered, using Rule of 78's, modified Rule of 78's, pro rata, or other methods as appropriate for the contract. Management selects the appropriate method based on available information, and periodically reviews the selections as additional information becomes available.

We do not disclose information about remaining performance obligations pertaining to contracts that have an original expected duration of one year or less. The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material at ~~September 30, 2021.~~March 31, 2022.

The timing of our revenue recognition may differ from the timing of payment by our customers. We record a receivable when revenue is recognized prior to payment and we have an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, we record deferred revenue until the performance obligations are satisfied.

The Company generates its revenues from charterers for the charter hire of its vessels. Vessels are chartered under time or voyage charters, where a contract is entered into for the use of a vessel for a specific voyage or a specific period of time and

Revenue is recognized when a charter agreement exists, the vessel is made available to the charterer and collection of the related revenue is reasonably assured. Unearned revenue includes revenue received prior to the balance sheet date relating to services to be rendered after the balance sheet date.

The following table presents the components of other assets as reported in the condensed consolidated balance sheets:

The following table presents the depreciation expense related to furniture, fixtures and equipment for the following periods:

The following table presents the components of other liabilities and accrued expenses as reported in the condensed consolidated balance sheets:

The following table presents the components of other revenue as reported in the condensed consolidated statement of operations. Other revenue is primarily generated by Tiptree Capital’s non-insurance activities except as noted in the footnote to the table.

The following table presents the components of other expenses as reported in the condensed consolidated statement of operations:

The Board of Directors authorized the Company to make repurchases of up to $20,000 of shares of the Company’s outstanding common stock in the aggregate, at the discretion of the Company's Executive Committee. ~~The following table presents~~There were no repurchases made during the ~~Company’s stock~~three months ended March 31, 2022. As of March 31, 2022, the remaining repurchase ~~activity and remaining authorization.~~authorization was $13,669.

In ~~April 2021,~~March 2022, warrants were exercised for ~~207,445~~492,295 shares of Tiptree common stock. As of ~~September 30, 2021,~~March 31, 2022, there were warrants for ~~2,016,044~~1,535,109 shares of Tiptree common stock outstanding at an exercise price of ~~$6.99.~~$6.95.

The Company declared cash dividends per share for the following periods presented below:

The Company’s U.S. insurance subsidiaries prepare financial statements in accordance with Statutory Accounting Principles (SAP) prescribed or permitted by the insurance departments of their states of domicile. Prescribed SAP includes the Accounting Practices and Procedures Manual of the National Association of Insurance Commissioners (the NAIC) as well as state laws, regulations and administrative rules.

The Company’s U.S. domiciled insurance company subsidiaries may pay dividends to the Company, subject to statutory restrictions. Payments in excess of statutory restrictions (extraordinary dividends) to the Company are permitted only with prior approval of the insurance department of the applicable state of domicile. The Company eliminates all dividends from its subsidiaries in the condensed consolidated financial statements. There were no dividends paid to the Company by its U.S. domiciled insurance company subsidiaries for the ~~nine months~~years ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~

The following table presents the combined amount available for ordinary dividends of the Company's U.S. domiciled insurance company subsidiaries for the following periods:

At ~~September 30, 2021,~~March 31, 2022, the maximum amount of dividends that our U.S. domiciled ~~regulated~~ insurance company subsidiaries could pay under applicable laws and regulations without regulatory approval was approximately ~~$18,519.~~$35,145. The Company may seek

regulatory approval to pay dividends in excess of this permitted amount, but there can be no assurance that the Company would receive regulatory approval if sought.

The following table presents the activity of AFS securities in accumulated other comprehensive income (loss) (AOCI), net of tax, for the following periods:

The Company adopted the Tiptree 2017 Omnibus Incentive Plan (2017 Equity Plan) on June 6, 2017, which permits the grant of restricted stock units (RSUs), stock, and stock options up to a maximum of 6,100,000 shares of common stock. The general purpose of the 2017 Equity Plan is to attract, motivate and retain selected employees and directors for the Company and its subsidiaries, to provide them with incentives and rewards for performance and to better align their interests with the interests of the Company’s stockholders. Unless otherwise extended, the 2017 Equity Plan terminates automatically on June 6, 2027.

The table below summarizes changes to the issuances under the Company’s 2017 Equity Plan for the periods indicated, excluding awards granted under the Company’s subsidiary incentive plans that are exchangeable for Tiptree common stock:

The Company values RSUs at their grant-date fair value as measured by Tiptree’s common stock price. Generally, the Tiptree RSUs vest and become non-forfeitable with respect to one-third of Tiptree shares granted on each of the first, second and third year anniversaries of the date of the grant, and expensed using the straight-line method over the requisite service period. The RSUs granted after 2019 include a retirement provision and are amortized over the lesser of the service condition or expected retirement date.

The Company values the stock awards at their issuance-date fair value as measured by Tiptree’s common stock price. Upon issuance, the awards are deemed to be granted and immediately vested.

The following table presents changes to the issuances of RSUs and stock awards under the 2017 Equity Plan for the periods indicated:

During the ~~nine months~~year ended ~~September 30,~~December 31, 2021, book value targets for all outstanding options were achieved.

The fair value option grants are estimated on the date of grant using a Black-Scholes-Merton option pricing formula embedded within a Monte Carlo model used to simulate the future stock prices of the Company, which assumes that the market requirement is achieved. Historical volatility was computed based on historical daily returns of the Company’s stock between the grant date and July 1, 2013, the date of the business combination through which Tiptree became a public company. The valuation is done under a risk-neutral framework using the 10-year zero-coupon risk-free interest rate derived from the Treasury Constant Maturities yield curve on the grant date. The current quarterly dividend rates in effect as of the date of the grant are used to calculate a spot dividend yield as of the date of grant for use in the model.

The following table presents the Company’s provision (benefit) for income taxes reflected as a component of income (loss):

The Company is a defendant in Mullins v. Southern Financial Life Insurance Co., which was filed in February 2006, in the Pike County Circuit Court, in the Commonwealth of Kentucky. A class was certified in June 2010. At issue is whether the ~~duration or term~~coverage period of ~~coverage under~~ certain credit disability and life ~~credit~~ insurance ~~policies.~~policies issued in Kentucky were limited by the term of the associated loan. The action alleges violations of the Kentucky Consumer Protection Act and certain insurance statutes, ~~as well as~~ common law fraud and ~~seeks~~breach of contract and the covenant of good faith and fair dealing. Plaintiffs seek compensatory and punitive damages, ~~attorney~~attorneys’ fees and interest. ~~To date, the court has not awarded sanctions~~

In July 2021, the court entered an Order granting Plaintiffs’ Motion for Partial Summary Judgment as to certain disability policies, ~~which~~ruling that if a class member became disabled during the coverage period, benefits could extend beyond the coverage period until the associated loan was paid off. The Company intends to ~~challenge.~~challenge the court’s ruling. In February 2022, a hearing was held on competing motions for partial summary judgment on the principal claims. A hearing for Plaintiffs’ Motion for Sanctions for Spoliation of Evidence is scheduled for June 9, 2022. The court has not yet ruled on the pending motions. No ~~trial or~~ additional hearings are ~~currently scheduled.~~scheduled and a trial date has not been set.

The Company considers such litigation customary in the insurance industry. In management's opinion, based on information

The Company and its subsidiaries are parties to other legal proceedings in the ordinary course of business. Although the Company’s legal and financial liability with respect to such proceedings cannot be estimated with certainty, the Company does not believe that these proceedings, either individually or in the aggregate, are likely to have a material adverse effect on the Company’s financial position.

The Company calculates basic net income per share of common stock (common share) based on the weighted average number of common shares outstanding, which includes vested corporate RSUs. Unvested corporate RSUs have a non-forfeitable right to participate in dividends declared and paid on the Company’s common stock on an as vested basis and are therefore considered a participating security. The Company calculates basic earnings per share using the “two-class” method under which the income available to common stockholders is allocated to the unvested corporate RSUs.

Diluted net income attributable to common stockholders includes the effect of unvested subsidiaries’ RSUs, when dilutive. The assumed exercise of all potentially dilutive instruments is included in the diluted net income per common share calculation, if dilutive.

The following table presents a reconciliation of basic and diluted net income per common share for the following periods:

Corvid Peak is a related party of the Company because Corvid Peak is deemed to be controlled by Michael Barnes, the

Company’s Executive Chairman. The Company is invested in a fund managed by Corvid Peak (the “Corvid Peak Fund”) and Corvid Peak manages investment portfolio accounts of Fortegra and certain of its subsidiaries under an investment advisory agreement (the “IAA”). With respect to the Corvid Peak Fund and IAA, the Company incurred ~~$185~~$768 and ~~$230~~$308 of management and incentive fees for the three months ended ~~September 30,~~March 31, 2022 and 2021, ~~and 2020, respectively and $769 and $667 of management and incentive fees for the nine months ended September 30, 2021 and 2020,~~ respectively.

Beginning January 1, 2021, Tiptree has

Pursuant to the Transition Services Agreement, Tiptree and Corvid Peak have mutually agreed to provide certain services to one another. Payments under the Transition Services Agreement in the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ were not material.

Pursuant to ~~the~~a Partner Emeritus Agreement, Tiptree agreed to provide Mr. Inayatullah, a greater than 5% stockholder of the Company, office space and support services, and reimburse Mr. Inayatullah for a portion of benefit expenses in exchange for advice and other consulting services as requested by the Company’s Executive Committee. Transactions related to the Partner Emeritus Agreement in the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 ~~and 2020~~ were not material.

On October 11, 2021, the Company and Fortegra entered into a Securities Purchase Agreement (the “Purchase Agreement”) with WP Falcon Aggregator, L.P., (“Purchaser”), a Delaware limited partnership affiliated with funds advised or managed by Warburg Pincus LLC, pursuant to which, Fortegra has committed to convert to a Delaware corporation and issue and sell, and the Purchaser agreed to purchase, a combination of (i) shares of common stock, par value $0.01 (“Common Stock”) of Fortegra, (ii) warrants to purchase shares of Common Stock, (iii) shares of Series A Preferred Stock of Fortegra and (iv) additional warrants to acquire Common Stock, for an aggregate purchase price of $200 million, in one or more fundings. Proceeds from the transactions are expected to be used to repay certain indebtedness, and to further capitalize Fortegra. The consummation of the transactions contemplated by the Purchase Agreement is subject to the satisfaction of customary closing conditions, including filings with, and approvals from, insurance and other relevant regulatory agencies.

Tiptree ~~is a holding company that~~ allocates capital to select small and middle market companies with the mission of building long-term value. Established in 2007, we have a significant track record investing in the insurance sector and across a ~~broad spectrum~~variety of ~~businesses, assets~~other industries, including mortgage origination, specialty finance and ~~other investments.~~shipping. Our largest operating subsidiary, Fortegra, ~~along with its subsidiaries,~~ is a leading provider of specialty insurance ~~underwriting, warranty and service contract~~ products and related ~~service solutions.~~services. We also generate earnings from a diverse group of select investments that we refer to as Tiptree Capital, which includes our Mortgage segment and other, non-insurance businesses and assets. We evaluate performance primarily by the comparison of shareholders’ long-term total return on capital, as measured by growth in stock price plus dividends paid, in addition to Adjusted Net Income and Adjusted EBITDA.

~~Highlights for the~~Our first ~~nine months of 2021~~quarter 2022 highlights include:

Our results of operations are affected by a variety of factors including, but not limited to, general economic conditions and GDP growth, market liquidity and volatility, consumer confidence, U.S. demographics, employment and wage growth, business confidence and investment, inflation, interest rates and spreads, the impact of the regulatory environment, and the other factors set forth in Part I, Item 1A in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. Generally, our businesses are positively affected by a healthy U.S. consumer, stable to gradually rising interest rates, stable markets and business conditions, and global growth and trade flows. Conversely, rising unemployment, volatile markets, rapidly rising interest rates, changing regulatory requirements and slowing business conditions can have a material adverse effect on our results of operations or financial condition.

Fortegra generally offers products which have low severity but high frequency loss experiences and are short duration. As a result, the business has historically generated significant fee-based revenues. In general, the types of products Fortegra offers tend to have limited aggregation risk and ~~thus,~~ limited exposure to catastrophic and residual risk. Underwriting risk is mitigated through a combination of reinsurance and retrospective commission structures with agents, distribution partners and/or third-party reinsurers. To mitigate counterparty risk, Fortegra ensures its distribution partners’ captive reinsurance entities are over-collateralized with highly liquid investments, primarily cash and cash equivalents. Insurance results primarily depend on pricing, underwriting, risk retention and the accuracy of reserves, reinsurance arrangements, returns on invested assets, and policy and contract renewals and run-off. Factors affecting these items, including conditions in financial markets, the global economy and the markets in which we operate, fluctuations in exchange rates, interest rates and inflation, including the current period of inflationary pressures, may have a material adverse effect on our results of operations or financial condition. While Fortegra’s insurance operations have historically maintained a relatively stable combined ratio, ~~which support steady earnings,~~ initiatives to change the business mix along with these economic factors could generate different results than the business has historically experienced. We believe there will continue to be growth opportunities to expand Fortegra’s specialty insurance ~~and warranty business model~~offerings to other niche products and markets.

Fortegra’s investment portfolio ~~primarily serves as a source to pay claims and secondarily as a source of income for operations. Investments include~~includes fixed maturity securities, loans, credit investment funds, and equity securities. Many of those investments are held at fair value. During the first quarter of 2022, the U.S. fixed income markets have experienced a significant rise in interest rates. Rising interest rates have and could continue to impact the value of Fortegra’s fixed maturity securities, with any unrealized losses recorded in equity, and if realized, could impact our results of operations. Offsetting the impact of a rising interest rate environment, new investments in fixed rate instruments from both maturities and portfolio growth can result in higher interest income on investments over time. The average duration of our fixed income available for sale securities is less than three years. During the first quarter of 2022, 2-year treasury yields increased significantly, which resulted in a negative impact on Fortegra’s fixed income portfolio and our book value, as the substantially majority was unrealized. While our asset and liability mix is relatively matched, and we generally have the ability to hold these securities to maturity, should we need to liquidate any of these investments before maturity to pay claims, any realized losses could materially negatively impact our results of operations.

Changes in fair value for loans, credit investment funds, and equity securities in Fortegra’s investment portfolio are reported quarterly as unrealized gains or losses in revenues and can be impacted by changes in interest rates, credit risk, or market risk, including specific company or industry factors. Our equity holdings are relatively concentrated. General equity market trends, along with company and industry specific factors, can impact the fair value which can result in unrealized gains and losses affecting our results.

~~Our businesses can also be impacted~~Rising 10-year treasury yields, and the tapering of the Federal Reserve’s purchases of mortgage-backed securities, has resulted in ~~various ways~~increases in mortgage interest rates. Low mortgage rates driven by ~~changes~~the Federal Reserve intervention in ~~interest~~mortgage

Rising interest rates can also impact the cost of ~~LIBOR based~~floating interest rate debt obligations, while declining rates can decrease the cost of debt. Our secured revolving and term credit agreements, preferred trust securities and ~~asset-based~~asset based revolving financing are all floating rate obligations. While the majority of our floating rate debt has LIBOR floors that are either at or above current LIBOR rates, a continuation of rising rates could have a material impact on our costs of floating rate debt.

Low mortgage rates due to the Federal Reserve intervention in mortgage markets and rising home prices in certain markets, has resulted in a combination of higher mortgage volumes and margins beginning in the second quarter of 2020 and continuing into the first nine months of 2021, which has been a benefit to mortgage operations. The recent low interest rate environment also benefits interest cost on debt, although corporate debt remains above current LIBOR rates. There can be no assurance that these positive trends will continue, the reversal of which could have a materially negative impact on our results of operations, and which may only be partially mitigated by the benefit to LIBOR based investments.

Common shares of Invesque represent a significant asset on our condensed consolidated balance ~~sheet,~~sheets, both as part of insurance investments and separately in Tiptree Capital. Our investment in Invesque, which operates in the seniors housing, skilled nursing and medical office industries, is carried on our condensed consolidated balance ~~sheet~~sheets at fair value. In April 2020, in response to the uncertainty in the industry, Invesque suspended its dividend to conserve liquidity. In combination with the impact of the COVID-19 pandemic on occupancy rates, Invesque’s stock declined significantly, which had a material impact on the carrying value of the investment and results of operations. While their stock price and the value of the investment increased in the first nine months of 2021, anyAny additional declines in the fair value of Invesque’s common stock could continue to have a significant impact on our results of operations and the value of the investment.

The maritime transportation industry is highly competitive and fragmented. Demand for shipping capacity is a function of global economic conditions and the related demand for commodities, production and consumption patterns, and is affected by events which interrupt production, trade routes, and consumption. Should rising interest rates and global inflationary factors drive a global recession, both charter rates and utilization rates could be negatively impacted. The shipping industry is cyclical with ~~high~~significant volatility in charter hire rates and profitability, which can change rapidly. General global economic conditions, along with company and industry specific factors, are expected to continue to impact the fair value of our vessels and associated operating results. While there is a current imbalance in supply and demand for shipping capacity, which ~~has~~ led to a cyclical high in dry-bulk charter rates, a change in those factors and/or changes in global economic conditions could result in substantially lower charter rates, which could negatively impact our results of operations and the carrying value of our vessels.

The following is a summary of our ~~condensed~~ consolidated financial results for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021. In addition to GAAP results, management uses the Non-GAAP measures Adjusted net income, Adjusted return on average equity, Adjusted EBITDA and book value per share as measurements of operating performance. Management believes these measures provide supplemental information useful to investors as they are frequently used by the financial community to analyze financial performance and comparison among companies. Management uses Adjusted net income and adjusted return on average equity as part of its capital allocation process and to assess comparative returns on invested capital. Adjusted EBITDA is also used in determining incentive compensation for the Company’s executive officers. Adjusted net income represents income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, stock-based compensation, net realized and unrealized gains (losses), and intangibles amortization associated with purchase accounting. The Company defines Adjusted EBITDA as GAAP net income of the Company plus corporate interest expense, plus income taxes, plus depreciation and amortization expense, less the effects of purchase accounting, plus non-cash fair value adjustments, plus significant non-recurring expenses, and plus unrealized gains (losses) on available for sale securities that are reported in other comprehensive income. Adjusted net income, Adjusted return on average equity and Adjusted EBITDA are not measurements of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for GAAP net income. See “Non-GAAP Reconciliations” for a reconciliation of these measures to their GAAP equivalents.

For the three months ended ~~September 30, 2021,~~March 31, 2022, revenues were ~~$286.6~~$324.9 million, which increased ~~$62.6~~$30.2 million, or 27.9% compared to the prior year period, primarily driven by growth in earned premiums, net, and service and administrative fees in the insurance business, partially offset by increased net realized and unrealized losses on Invesque and other investments in the 2021 period compared to the 2020 period.

The table below provides a break down between net realized and unrealized gains and losses from Invesque and other securities which impacted our consolidated results on a pre-tax basis. Many investments are carried at fair value and marked to market through unrealized gains and losses. As a result, we expect earnings relating to these investments to be relatively volatile between periods. Fixed income securities are primarily marked to market through AOCI in stockholders’ equity and do not impact net realized and unrealized gains and losses until they are sold.

For the three months ended ~~September 30, 2021,~~March 31, 2022, net ~~income~~loss attributable to common stockholders was ~~$2.0~~$1.0 million, a decrease of ~~$10.8~~$29.5 million ~~driven by increased net realized and unrealized losses in the current period, partially offset by improvement in insurance and shipping revenues. For the nine months ended September 30, 2021,~~from net income ~~attributable to common stockholders was $38.6 million, an increase~~ of ~~$82.0 million from a net loss of $43.4~~$28.6 million for the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, primarily driven by net realized and unrealized ~~gains~~losses on Invesque and other investments in ~~the 2021 period~~2022 compared to ~~losses~~gains in ~~the 2020 period, in addition to~~2021, and lower mortgage origination revenues, partially offset by growth in Fortegra’s underwriting and fee operations, increased revenues from our mortgage servicing portfolio and improvement in dry-bulk and tanker shipping rates.

Adjusted net income for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$20.7~~$15.5 million, an increase of ~~$2.9~~$2.3 million, or ~~16.4%~~17.5%, from the three months ended ~~September 30, 2020.~~March 31, 2021. For the three months ended ~~September 30, 2021,~~March 31, 2022, adjusted return on average equity was ~~20.5%~~15.8%, as compared to ~~20.1%~~13.7% at ~~September 30, 2020,~~March 31, 2021, with the increase in both metrics driven by improved performance in our insurance and shipping operations.

Service fee revenue is recognized as the services are performed. These services include fulfillment, software development, and claims handling for our customers. Management reviews the financial results under each significant contract on a monthly basis. Any losses that may occur due to a specific contract would be recognized in the period in which the loss is determined probable.

~~Adjusted EBITDA~~Administrative fee revenue includes the administration of premium associated with our producers and PORCs. In addition, we also earn fee revenue from debt cancellation, motor club, and auto and consumer goods service contracts. Related administrative fee revenue is recognized consistent with the earnings recognition pattern of the underlying insurance policies, debt cancellation contracts and motor club memberships being administered, using Rule of 78's, modified Rule of 78's, pro rata, or other methods as appropriate for the contract. Management selects the appropriate method based on available information, and periodically reviews the selections as additional information becomes available.

We do not disclose information about remaining performance obligations pertaining to contracts that have an original expected duration of one year or less. The transaction price allocated to remaining unsatisfied or partially unsatisfied performance obligations with an original expected duration exceeding one year was not material at March 31, 2022.

The timing of our revenue recognition may differ from the timing of payment by our customers. We record a receivable when revenue is recognized prior to payment and we have an unconditional right to payment. Alternatively, when payment precedes the provision of the related services, we record deferred revenue until the performance obligations are satisfied.

The Company generates its revenues from charterers for the charter hire of its vessels. Vessels are chartered under time or voyage charters, where a contract is entered into for the use of a vessel for a specific voyage or a specific period of time and at a specified daily charter rate. Charter revenues are recognized as earned on the straight-line basis over the term of the charter as service is provided.

Revenue is recognized when a charter agreement exists, the vessel is made available to the charterer and collection of the related revenue is reasonably assured. Unearned revenue includes revenue received prior to the balance sheet date relating to services to be rendered after the balance sheet date.

The following table presents the components of other assets as reported in the condensed consolidated balance sheets:

The following table presents the depreciation expense related to furniture, fixtures and equipment for the following periods:

The following table presents the components of other liabilities and accrued expenses as reported in the condensed consolidated balance sheets:

The following table presents the components of other revenue as reported in the condensed consolidated statement of operations. Other revenue is primarily generated by Tiptree Capital’s non-insurance activities except as noted in the footnote to the table.

The following ~~tables present~~table presents the components of ~~Revenue, Income (loss) before taxes and Adjusted net income.~~other expenses as reported in the condensed consolidated statement of operations:

The Board of ~~non-GAAP financial measures.~~Directors authorized the Company to make repurchases of up to $20,000 of shares of the Company’s outstanding common stock in the aggregate, at the discretion of the Company's Executive Committee. There were no repurchases made during the three months ended March 31, 2022. As of March 31, 2022, the remaining repurchase authorization was $13,669.

In March 2022, warrants were exercised for 492,295 shares of Tiptree common stock. As of March 31, 2022, there were warrants for 1,535,109 shares of Tiptree common stock outstanding at an exercise price of $6.95.

The Company declared cash dividends per share for the following periods presented below:

The Company’s U.S. insurance subsidiaries prepare financial statements in accordance with Statutory Accounting Principles (SAP) prescribed or permitted by the insurance departments of their states of domicile. Prescribed SAP includes the Accounting Practices and Procedures Manual of the National Association of Insurance Commissioners (the NAIC) as well as state laws, regulations and administrative rules.

The Company’s U.S. domiciled insurance company subsidiaries may pay dividends to the Company, subject to statutory restrictions. Payments in excess of statutory restrictions (extraordinary dividends) to the Company are permitted only with prior approval of the insurance department of the applicable state of domicile. The Company eliminates all dividends from its subsidiaries in the condensed consolidated financial statements. There were no dividends paid to the Company by its U.S. domiciled insurance company subsidiaries for the years ended March 31, 2022 and 2021.

The following table presents the combined amount available for ordinary dividends of the Company's U.S. domiciled insurance company subsidiaries for the following periods:

At March 31, 2022, the maximum amount of dividends that our U.S. domiciled insurance company subsidiaries could pay under applicable laws and regulations without regulatory approval was approximately $35,145. The Company may seek

regulatory approval to pay dividends in excess of this permitted amount, but there can be no assurance that the Company would receive regulatory approval if sought.

The following table presents the activity of AFS securities in accumulated other comprehensive income (loss) (AOCI), net of tax, for the following periods:

The Company adopted the Tiptree 2017 Omnibus Incentive Plan (2017 Equity Plan) on June 6, 2017, which permits the grant of restricted stock units (RSUs), stock, and stock options up to a maximum of 6,100,000 shares of common stock. The general purpose of the 2017 Equity Plan is to attract, motivate and retain selected employees and directors for the Company and its subsidiaries, to provide them with incentives and rewards for performance and to better align their interests with the interests of the Company’s stockholders. Unless otherwise extended, the 2017 Equity Plan terminates automatically on June 6, 2027.

The table below summarizes changes to the issuances under the Company’s 2017 Equity Plan for the periods indicated, excluding awards granted under the Company’s subsidiary incentive plans that are exchangeable for Tiptree common stock:

The Company values RSUs at their grant-date fair value as measured by Tiptree’s common stock price. Generally, the Tiptree RSUs vest and become non-forfeitable with respect to one-third of Tiptree shares granted on each of the first, second and third year anniversaries of the date of the grant, and expensed using the straight-line method over the requisite service period. The RSUs granted after 2019 include a retirement provision and are amortized over the lesser of the service condition or expected retirement date.

The Company values the stock awards at their issuance-date fair value as measured by Tiptree’s common stock price. Upon issuance, the awards are deemed to be granted and immediately vested.

The following table presents changes to the issuances of RSUs and stock awards under the 2017 Equity Plan for the periods indicated:

During the year ended December 31, 2021, book value targets for all outstanding options were achieved.

The fair value option grants are estimated on the date of grant using a Black-Scholes-Merton option pricing formula embedded within a Monte Carlo model used to simulate the future stock prices of the Company, which assumes that the market requirement is achieved. Historical volatility was computed based on historical daily returns of the Company’s stock between the grant date and July 1, 2013, the date of the business combination through which Tiptree became a public company. The valuation is done under a risk-neutral framework using the 10-year zero-coupon risk-free interest rate derived from the Treasury Constant Maturities yield curve on the grant date. The current quarterly dividend rates in effect as of the date of the grant are used to calculate a spot dividend yield as of the date of grant for use in the model.

The following table presents the Company’s provision (benefit) for income taxes reflected as a component of income (loss):

The Company is a defendant in Mullins v. Southern Financial Life Insurance Co., which was filed in February 2006, in the Pike County Circuit Court, in the Commonwealth of Kentucky. A class was certified in June 2010. At issue is whether the coverage period of certain credit disability and life insurance policies issued in Kentucky were limited by the term of the associated loan. The action alleges violations of the Kentucky Consumer Protection Act and certain insurance statutes, common law fraud and breach of contract and the covenant of good faith and fair dealing. Plaintiffs seek compensatory and punitive damages, attorneys’ fees and interest.

In July 2021, the court entered an Order granting Plaintiffs’ Motion for Partial Summary Judgment as to certain disability policies, ruling that if a class member became disabled during the coverage period, benefits could extend beyond the coverage period until the associated loan was paid off. The Company intends to challenge the court’s ruling. In February 2022, a hearing was held on competing motions for partial summary judgment on the principal claims. A hearing for Plaintiffs’ Motion for Sanctions for Spoliation of Evidence is scheduled for June 9, 2022. The court has not yet ruled on the pending motions. No additional hearings are scheduled and a trial date has not been set.

The Company considers such litigation customary in the insurance industry. In management's opinion, based on information available at this time, the ultimate resolution of such litigation, which it is vigorously defending, should not be materially adverse to the financial position of the Company. It should be noted that large punitive damage awards, bearing little relation to actual damages sustained by plaintiffs, have been awarded in certain states against other companies in the credit insurance business. At this time, the Company cannot estimate a range of loss that is reasonably possible.

The Company and its subsidiaries are parties to other legal proceedings in the ordinary course of business. Although the Company’s legal and financial liability with respect to such proceedings cannot be estimated with certainty, the Company does not believe that these proceedings, either individually or in the aggregate, are likely to have a material adverse effect on the Company’s financial position.

The Company calculates basic net income per share of common stock (common share) based on the weighted average number of common shares outstanding, which includes vested corporate RSUs. Unvested corporate RSUs have a non-forfeitable right to participate in dividends declared and paid on the Company’s common stock on an as vested basis and are therefore considered a participating security. The Company calculates basic earnings per share using the “two-class” method under which the income available to common stockholders is allocated to the unvested corporate RSUs.

Diluted net income attributable to common stockholders includes the effect of unvested subsidiaries’ RSUs, when dilutive. The assumed exercise of all potentially dilutive instruments is included in the diluted net income per common share calculation, if dilutive.

The following table presents a reconciliation of basic and diluted net income per common share for the following periods:

Corvid Peak is a related party of the Company because Corvid Peak is deemed to be controlled by Michael Barnes, the

Company’s Executive Chairman. The Company is invested in a fund managed by Corvid Peak (the “Corvid Peak Fund”) and Corvid Peak manages investment portfolio accounts of Fortegra and certain of its subsidiaries under an investment advisory agreement (the “IAA”). With respect to the Corvid Peak Fund and IAA, the Company incurred $768 and $308 of management and incentive fees for the three months ended March 31, 2022 and 2021, respectively.

Beginning January 1, 2021, Tiptree has been allocated 10.2% of certain profits interests earned by Corvid Peak with an additional 10.2% interest for each of the next consecutive four years. Beginning January 1, 2022, Tiptree’s percentage interest increased to 21.95% (including interests acquired from former Corvid Peak equity holders).

Pursuant to the Transition Services Agreement, Tiptree and Corvid Peak have mutually agreed to provide certain services to one another. Payments under the Transition Services Agreement in the three months ended March 31, 2022 and 2021 were not material.

Pursuant to a Partner Emeritus Agreement, Tiptree agreed to provide Mr. Inayatullah, a greater than 5% stockholder of the Company, office space and support services, and reimburse Mr. Inayatullah for a portion of benefit expenses in exchange for advice and other consulting services as requested by the Company’s Executive Committee. Transactions related to the Partner Emeritus Agreement in the three months ended March 31, 2022 and 2021 were not material.

On May 3, 2022, the Company’s board of directors declared a quarterly cash dividend of $0.04 per share to holders of common stock with a record date of May 23, 2022, and a payment date of May 31, 2022.

($ in thousands) Three Months Ended September 30,
2021 2020 Change % Change
Revenues:
Earned premiums, net $ 175,026 $ 116,418 $ 58,608 50.3 %
Service and administrative fees 69,664 47,701 21,963 46.0 %
Ceding commissions 2,722 5,157 (2,435) (47.2) %
Net investment income 3,330 3,023 307 10.2 %
Net realized and unrealized gains (losses) (7,492) 659 (8,151) NM%
Other revenue 3,456 1,047 2,409 230.1 %
Total revenues $ 246,706 $ 174,005 $ 72,701 41.8 %
Expenses:
Net losses and loss adjustment expenses $ 61,252 $ 42,920 $ 18,332 42.7 %
Member benefit claims 19,579 14,818 4,761 32.1 %
Commission expense 104,392 68,868 35,524 51.6 %
Employee compensation and benefits 19,526 15,969 3,557 22.3 %
Interest expense 4,268 3,988 280 7.0 %
Depreciation and amortization 4,307 2,329 1,978 84.9 %
Other expenses 20,045 11,666 8,379 71.8 %
Total expenses $ 233,369 $ 160,558 $ 72,811 45.3 %
Income (loss) before taxes (1)
$ 13,337 $ 13,447 $ (110) (0.8) %
Key Performance Metrics:
Gross written premiums and premium equivalents $ 613,113 $ 464,669 $ 148,444 31.9 %
Return on average equity 13.7 % 15.9 %
Underwriting ratio 73.8 % 74.3 %
Expense ratio 15.8 % 16.3 %
Combined ratio 89.6 % 90.6 %
Non-GAAP Financial Measures (2):
Adjusted net income $ 19,533 $ 12,111 $ 7,422 61.3 %
Adjusted return on average equity 26.8 % 17.1 %
Tiptree allocates capital to select small and middle market companies with the mission of building long-term value. Established in 2007, we have a significant track record investing in the insurance sector and across a variety of other industries, including mortgage origination, specialty finance and shipping. Our largest operating subsidiary, Fortegra, is a leading provider of specialty insurance products and related services. We also generate earnings from a diverse group of select investments that we refer to as Tiptree Capital, which includes our Mortgage segment and other, non-insurance businesses and assets. We evaluate performance primarily by the comparison of shareholders’ long-term total return on capital, as measured by growth in stock price plus dividends paid, in addition to Adjusted Net Income and Adjusted EBITDA.

Our first quarter 2022 highlights include:

Our results of operations are affected by a variety of factors including, but not limited to, general economic conditions and GDP growth, market liquidity and volatility, consumer confidence, U.S. demographics, employment and wage growth, business confidence and investment, inflation, interest rates and spreads, the impact of the regulatory environment, and the other factors set forth in Part I, Item 1A in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Generally, our businesses are positively affected by a healthy U.S. consumer, stable to gradually rising interest rates, stable markets and business conditions, and global growth and trade flows. Conversely, rising unemployment, volatile markets, rapidly rising interest rates, changing regulatory requirements and slowing business conditions can have a material adverse effect on our results of operations or financial condition.

Fortegra generally offers products which have low severity but high frequency loss experiences and are short duration. As a result, the business has historically generated significant fee-based revenues. In general, the types of products Fortegra offers tend to have limited aggregation risk and limited exposure to catastrophic and residual risk. Underwriting risk is mitigated through a combination of reinsurance and retrospective commission structures with agents, distribution partners and/or third-party reinsurers. To mitigate counterparty risk, Fortegra ensures its distribution partners’ captive reinsurance entities are over-collateralized with highly liquid investments, primarily cash and cash equivalents. Insurance results primarily depend on pricing, underwriting, risk retention and the accuracy of reserves, reinsurance arrangements, returns on invested assets, and policy and contract renewals and run-off. Factors affecting these items, including conditions in financial markets, the global economy and the markets in which we operate, fluctuations in exchange rates, interest rates and inflation, including the current period of inflationary pressures, may have a material adverse effect on our results of operations or financial condition. While Fortegra’s insurance operations have historically maintained a relatively stable combined ratio, initiatives to change the business mix along with these economic factors could generate different results than the business has historically experienced. We believe there will continue to be growth opportunities to expand Fortegra’s specialty insurance offerings to other niche products and markets.

Fortegra’s investment portfolio includes fixed maturity securities, loans, credit investment funds, and equity securities. Many of those investments are held at fair value. During the first quarter of 2022, the U.S. fixed income markets have experienced a significant rise in interest rates. Rising interest rates have and could continue to impact the value of Fortegra’s fixed maturity securities, with any unrealized losses recorded in equity, and if realized, could impact our results of operations. Offsetting the impact of a rising interest rate environment, new investments in fixed rate instruments from both maturities and portfolio growth can result in higher interest income on investments over time. The average duration of our fixed income available for sale securities is less than three years. During the first quarter of 2022, 2-year treasury yields increased significantly, which resulted in a negative impact on Fortegra’s fixed income portfolio and our book value, as the substantially majority was unrealized. While our asset and liability mix is relatively matched, and we generally have the ability to hold these securities to maturity, should we need to liquidate any of these investments before maturity to pay claims, any realized losses could materially negatively impact our results of operations.

Changes in fair value for loans, credit investment funds, and equity securities in Fortegra’s investment portfolio are reported quarterly as unrealized gains or losses in revenues and can be impacted by changes in interest rates, credit risk, or market risk, including specific company or industry factors. Our equity holdings are relatively concentrated. General equity market trends, along with company and industry specific factors, can impact the fair value which can result in unrealized gains and losses affecting our results.

Rising 10-year treasury yields, and the tapering of the Federal Reserve’s purchases of mortgage-backed securities, has resulted in increases in mortgage interest rates. Low mortgage rates driven by the Federal Reserve intervention in mortgage

Rising interest rates can also impact the cost of floating interest rate debt obligations, while declining rates can decrease the cost of debt. Our secured revolving and term credit agreements, preferred trust securities and asset based revolving financing are all floating rate obligations. While the majority of our floating rate debt has LIBOR floors that are either at or above current LIBOR rates, a continuation of rising rates could have a material impact on our costs of floating rate debt.

Common shares of Invesque represent a significant asset on our condensed consolidated balance sheets, both as part of insurance investments and separately in Tiptree Capital. Our investment in Invesque, which operates in the seniors housing, skilled nursing and medical office industries, is carried on our condensed consolidated balance sheets at fair value. Any additional declines in the fair value of Invesque’s common stock could continue to have a significant impact on our results of operations and the value of the investment.

The maritime transportation industry is highly competitive and fragmented. Demand for shipping capacity is a function of global economic conditions and the related demand for commodities, production and consumption patterns, and is affected by events which interrupt production, trade routes, and consumption. Should rising interest rates and global inflationary factors drive a global recession, both charter rates and utilization rates could be negatively impacted. The shipping industry is cyclical with significant volatility in charter hire rates and profitability, which can change rapidly. General global economic conditions, along with company and industry specific factors, are expected to continue to impact the fair value of our vessels and associated operating results. While there is a current imbalance in supply and demand for shipping capacity, which led to a cyclical high in dry-bulk charter rates, a change in those factors and/or changes in global economic conditions could result in substantially lower charter rates, which could negatively impact our results of operations and the carrying value of our vessels.

The following is a summary of our consolidated financial results for the three months ended March 31, 2022 and 2021. In addition to GAAP results, management uses the Non-GAAP measures Adjusted net income, Adjusted return on average equity, Adjusted EBITDA and book value per share as measurements of operating performance. Management believes these measures provide supplemental information useful to investors as they are frequently used by the financial community to analyze financial performance and comparison among companies. Management uses Adjusted net income and adjusted return on average equity as part of its capital allocation process and to assess comparative returns on invested capital. Adjusted EBITDA is also used in determining incentive compensation for the Company’s executive officers. Adjusted net income represents income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, stock-based compensation, net realized and unrealized gains (losses), and intangibles amortization associated with purchase accounting. The Company defines Adjusted EBITDA as GAAP net income of the Company plus corporate interest expense, plus income taxes, plus depreciation and amortization expense, less the effects of purchase accounting, plus non-cash fair value adjustments, plus significant non-recurring expenses, and plus unrealized gains (losses) on available for sale securities that are reported in other comprehensive income. Adjusted net income, Adjusted return on average equity and Adjusted EBITDA are not measurements of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for GAAP net income. See “Non-GAAP Reconciliations” for a reconciliation of these measures to their GAAP equivalents.

~~Earned Premiums,~~For the three months ended March 31, 2022, revenues were $324.9 million, which increased $30.2 million, or 10.3%, compared to the prior year period, primarily driven by growth in earned premiums, net, and service and administrative fees in the insurance business, increased revenues from vessels and our mortgage servicing portfolio, partially offset by lower mortgage volumes and margins and net realized and unrealized losses on Invesque and other investments in 2022 compared to gains in 2021.

~~Earned premiums,~~The table below provides a break down between net ~~represent the earned portion of gross written~~realized and ~~assumed premiums, less the earned portion that is ceded~~unrealized gains and losses from Invesque and other securities which impacted our consolidated results on a pre-tax basis. Many investments are carried at fair value and marked to ~~third-party reinsurers under reinsurance agreements. Fortegra’s insurance policies generally have~~market through unrealized gains and losses. As a ~~term of six months~~result, we expect earnings relating to ~~seven years depending on the underlying product~~these investments to be relatively volatile between periods. Fixed income securities are primarily marked to market through AOCI in stockholders’ equity and ~~premiums~~do not impact net realized and unrealized gains and losses until they are ~~earned pro rata over the term of the policy. At the end of each reporting period, premiums written but not earned are classified as unearned premiums~~sold.

Total gross written premiums and premium equivalents for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 were ~~$1,689.6~~$600.9 million as compared to ~~$1,176.0~~$477.2 million in ~~2020.~~2021. The growth of ~~$513.6~~$123.6 million, or ~~43.7%~~25.9%, is driven by a combination of factors including growing Fortegra’s distribution partner network, expanding specialty admitted and E&S insurance lines, and increasing penetration ~~through the warranty acquisitions of Smart AutoCare (January 2020) and Sky Auto (December 2020). Additionally, certain distribution partners were impacted by COVID-19 shutdowns~~ in the ~~second~~auto and ~~third quarters 2020, providing for a more favorable period over period comparison.~~consumer goods service contract sector.

For the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, U.S. Insurance increased by ~~$353.6~~$71.2 million, or ~~47.7%~~21.2%, driven by growth in commercial, ~~credit, collateral protection~~E&S, and warranty insurance lines. For the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, U.S. Warranty Solutions increased by ~~$125.2~~$37.4 million, or ~~31.3%~~29.8%, driven by growth in auto and ~~consumer goods~~roadside assistance service ~~contracts, including the acquisition of Sky Auto.~~contracts. Europe Warranty Solutions increased by ~~$34.8~~$15.1 million, or ~~98.9%~~94.0%, driven by growth in auto and consumer goods warranty programs.

The growth in gross written premiums and premium equivalents, combined with higher retention in select products for the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, has resulted in an increase of ~~$413.1~~$432.5 million, or ~~35.9%~~32.8%, in unearned premiums and deferred revenue on the condensed consolidated balance sheets as compared to ~~September 30, 2020.~~March 31, 2021. As of ~~September 30, 2021,~~March 31, 2022, unearned premiums and deferred revenues were ~~$1,564.4~~$1,749.1 million, as compared to ~~$1,151.3~~$1,316.6 million as of ~~September 30, 2020.~~March 31, 2021.

Combined ratio is an operating measure, which equals the sum of the underwriting ratio and the expense ratio. Underwriting ratio is the ratio of the GAAP line items net losses and loss adjustment expenses, member benefit claims and commission expense to earned premiums, net, service and administrative fees and ceding commissions and other revenue. Expense ratio is the ratio of the GAAP line items employee compensation and benefits and other underwriting, general and administrative expenses to earned premiums, net, service and administrative fees and ceding commissions and other revenue.

A combined ratio under 100% generally indicates an underwriting profit. A combined ratio over 100% generally indicates an underwriting loss. These ratios are commonly used in the insurance industry as a measure of underwriting profitability, excluding earnings on the insurance portfolio. Investors commonly use these measures to compare underwriting performance among companies separate from the performance of the investment portfolio. Management uses these measures to compare the profitability of various products underwritten as well as profitability among programs between various agents and sales channels.

Return on average equity is expressed as the ratio of net income to average stockholders’ equity during the period. Management uses this ratio as a measure of the on-going performance of the totality of the Company’s operations.

Return on average equity was ~~17.3%~~14.7% for the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, as compared to ~~1.5%~~23.9% for the ~~nine~~three months ended ~~September 30, 2020,~~March 31, 2021, with the ~~increase~~decrease in net income and annualized return on average equity driven by ~~revenue growth~~net realized and ~~an improved combined ratio,~~unrealized losses in ~~addition~~the 2022 period compared to net realized and unrealized gains in the 2021 period, ~~compared to net realized~~partially offset by revenue growth and ~~unrealized losses in the 2020 period.~~an improved combined ratio.

In order to better explain to investors the underwriting performance of the Company’s programs and the respective retentions between the Company and its agents and reinsurance partners, we use the non-GAAP metrics – underwriting and fee revenues and underwriting and fee margin. Underwritten exposures are managed using both reinsurance (e.g., quota share and excess of loss) and retrospective commission agreements with Fortegra’s agents (e.g., commissions paid are adjusted based on the actual underlying losses incurred). Period-over-period comparisons of revenues and expenses are often impacted by the agents and their PORC’s choice as to their risk retention appetite, specifically earned premiums, net, service and administration fees, ceding commissions, and other revenue, all components of revenue, and losses and loss adjustment expenses, member benefit claims, and commissions paid to Fortegra’s agents and reinsurers. Generally, when losses are incurred, the risk which is retained by Fortegra’s agents and reinsurers is reflected in a reduction in commissions paid.

The below table shows underwriting and fee revenues and underwriting and fee margin by business mix for the three ~~and nine~~ months ended ~~September 30, 2021~~March 31, 2022 and ~~2020.~~2021.

Underwriting and fee revenues were ~~$250.9~~$286.0 million for the three months ended ~~September 30, 2021~~March 31, 2022 as compared to ~~$170.3~~$210.1 million for the three months ended ~~September 30, 2020.~~March 31, 2021. Total underwriting and fee revenues increased ~~$80.5~~$75.9 million, or ~~47.3%~~36.1%, driven by growth in all business lines. The increase in U.S. Insurance was ~~$52.5~~$61.2 million, or ~~42.8%~~40.8%, driven by growth in commercial, E&S, and credit ~~and warranty~~ insurance ~~programs.~~lines. The increase in U.S. Warranty Solutions was ~~$20.1~~$9.9 million, or ~~48.7%~~19.4%, driven by growth in auto, ~~consumer goods,~~roadside assistance, and premium ~~and warranty~~ finance ~~programs, including the acquisition of~~

Management uses both these measures for executive compensation and as a measure of the on-going performance of our operations. See “—Non-GAAP Reconciliations” for a reconciliation of adjusted net income and adjusted return on average equity to income before taxes and adjusted return on average equity.

For the three months ended ~~September 30, 2021,~~March 31, 2022, adjusted net income and adjusted return on average equity were ~~$19.5~~$21.1 million and ~~26.8%~~28.2%, respectively, as compared to ~~$12.1~~$12.8 million and ~~17.1%~~17.9%, respectively, for the three months ended ~~September 30, 2020.~~March 31, 2021. The improvement in both metrics was driven by the growth in underwriting and fee revenues in addition to a 1.0 ~~percentage point improvement in the combined ratio.~~

The insurance investment portfolio includes investments held in statutory insurance companies and in unregulated entities. The portfolios held in statutory insurance companies are subject to different regulatory considerations, including with respect to types of assets, concentration limits, affiliate transactions and the use of leverage. Fortegra’s investment strategy is designed to achieve attractive risk-adjusted returns across select asset classes, sectors and geographies while maintaining adequate liquidity to meet claims payment obligations. As such, volatility from realized and unrealized gains and losses may impact period-over-period performance. Unrealized gains and losses on equity securities and loans held at fair value impact current period net income, while unrealized gains and losses on AFS securities impact AOCI.

Net investment income includes interest and dividends, net of investment expenses, on invested assets. Net realized and unrealized gains and losses on investments are reported separately from net investment income.

For the three months ended ~~September 30, 2021,~~March 31, 2022, net investment income was ~~$3.3~~$3.2 million as compared to ~~$3.0~~$2.8 million in the prior year period, driven by growth in ~~investments, partially offset by lower interest rates.~~investments. Net realized and unrealized losses were ~~$7.5~~$6.6 million, a decrease of ~~$8.2~~$16.3 million, driven by realized and unrealized losses on certain equity securities and other investments, including fixed income securities carried at fair value, in the ~~2021~~2022 period as compared to gains in the ~~2020~~2021 period.

~~For~~Unrealized losses impacting OCI for the ~~nine~~three months ended September 30, 2021, net investment income was $9.3 million as compared to $8.8 million in the prior year period, driven by growth in investments, partially offset by lower interest rates. Net realized and unrealized gainsMarch 31, 2022 were ~~$5.0 million, an increase of $32.3~~$26.4 million, driven by ~~realized~~the rise in interest rates and ~~unrealized gains on equity securities in~~corresponding impact to the ~~2021 period, as compared to losses on equity securities and other~~fair value of investments in ~~the 2020 period.~~U.S. Treasuries, obligations of U.S. government agencies, corporate securities, obligations of state and political subdivisions, and asset-backed securities.

Tiptree Capital consists of our Mortgage segment, which includes the operating results of Reliance, our mortgage business, and Tiptree Capital - Other, which consists of our other non-insurance operating businesses and investments. As of ~~September 30, 2021,~~March 31, 2022, Tiptree Capital - Other includes our Invesque shares, maritime transportation operations, and the mortgage operations of Luxury, which is classified as held for sale on ~~our~~the condensed consolidated balance ~~sheet.~~sheets.

Through our Mortgage operating subsidiary, Reliance, we originate, sell, securitize and service one-to-four-family, residential mortgage loans, comprised of conforming mortgage loans, Federal Housing Administration (“FHA”), Veterans Administration (“VA”), United States Department of Agriculture (“USDA”), and to a lesser extent, non-agency jumbo prime.

We are an approved seller/servicer for ~~Federal National Mortgage Association (“~~Fannie ~~Mae”)~~Mae and ~~Federal Home Loan Mortgage Corporation (“~~Freddie ~~Mac”).~~Mac. The Company is also an approved issuer and servicer for ~~Government National Mortgage Association (“GNMA” or “Ginnie Mae”).~~Ginnie Mae. The Company originates residential mortgage loans through its retail distribution channel (directly to consumers) in 39 states and the District of Columbia as of ~~September 30, 2021.~~March 31, 2022.

The following tables present the Mortgage segment results for the ~~three and nine months ended September 30, 2021 and 2020.~~following periods:

Net realized and unrealized gains (losses) include gains on sale of mortgage loans and the fair value adjustment in mortgage servicing rights. Gains on the sale of mortgage loans represent the difference between the selling price and carrying value of loans sold and are recognized upon settlement. Such gains also include the changes in fair value of loans held for sale and loan-related hedges and derivatives. We transfer the risk of loss or default to the loan purchaser, however, in some cases we are required to indemnify purchasers for losses related to non-compliance with borrowers’ creditworthiness and collateral requirements. Because of this, we recognize gains on sale net of required indemnification and premium recapture reserves. The fair value adjustment on mortgage servicing rights represents fair value adjustments considering estimated prepayments and other factors associated with changes in interest rates, plus actual run-off in the servicing portfolio. We report these adjustments separate from servicing income and servicing expense.

Other revenue includes loan origination fees, interest income, and mortgage servicing income. Loan origination fees are earned as mortgage loans are funded. Servicing fees are earned over the life of the loan. Interest income includes interest earned on loans held for sale and interest income on bank balances and short-term investments.

For the three months ended ~~September 30, 2021, we funded $385.0~~March 31, 2022, $354.4 million of loans were funded, compared to ~~$440.1~~$419.9 million for ~~2020,~~2021, a decrease of ~~$55.1~~$65.5 million, or ~~12.5%~~15.6%. ~~The decrease~~Origination volumes in ~~origination volumes is driven~~2022 declined given the rise in mortgage interest rates, partially offset by ~~lower mortgage~~home price appreciation and cash-out refinancing ~~levels across~~activity in the ~~industry as compared to cyclical highs observed in 2020.~~United States. Gain on sale margins decreased to ~~5.5%~~4.3% for the three months ended ~~September 30, 2021,~~March 31, 2022, down approximately ~~130~~170 basis points from ~~6.8%~~6.0% for the three months ended ~~September 30, 2020.~~ March 31, 2021.

Net realized and unrealized gains for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$22.7~~$20.4 million, compared to ~~$31.9~~$30.1 million for ~~2020,~~2021, a decrease of ~~$9.2~~$9.7 million or ~~29.0%~~32.1%. The primary ~~drivers~~driver of ~~the~~ decreased ~~gains~~gain on sale revenues ~~were decreases~~was the decline in ~~origination~~ volumes and gain on sale margins, ~~relative to the third quarter of 2020,~~ partially offset by positive fair value adjustments in mortgage servicing rights of ~~$1.1~~$6.3 million as interest rates increased infrom the ~~third quarter 2021 relative to the prior period.~~ year ended December 31, 2021.

Other revenue for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$4.8~~$5.0 million, compared to ~~$4.0~~$4.4 million for ~~2020,~~2021, an increase of ~~$0.8~~$0.6 million, or ~~19.7% driven by increased servicing fees associated with increased loans serviced.~~

Employee compensation and benefits includes salaries, commissions, benefits, bonuses, other incentive compensation and related taxes for employees. Commissions expense for sales staff generally varies with loan origination volumes.

Interest expense represents borrowing costs under warehouse and other credit facilities used primarily to fund loan originations. Amortization of deferred financing costs, including commitment fees, is included in interest expense.

Depreciation expense is mainly associated with furniture, fixtures and equipment while amortization expense is primarily associated with a trade name and internally developed software.

Other expenses include loan origination expenses, namely, leads, appraisals, credit reporting and licensing fees, general and administrative expenses, including office rent, insurance, legal, consulting and payroll processing expenses, and servicing expense.

For the three months ended ~~September 30, 2021,~~March 31, 2022, employee compensation and benefits ~~was~~were $14.4 million, compared to ~~$15.9~~$15.3 million in ~~2020,~~2021, a decrease of ~~$1.5~~$0.9 million or 9.5%. This decrease was driven primarily by reduced commissions on lower origination volumes, in addition to decreased incentive compensation. For the three months ended September 30, 2021 and 2020, interest expense was $0.3 million and depreciation and amortization expense was $0.2 million. For the three months ended September 30, 2021, other expenses were $6.3 million compared to $5.0 million in 2020, with the $1.2 million increase driven by increased loan origination expenses, including marketing costs.

For the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021, interest expense ~~was $0.8 million compared to $0.9 million in 2020. For the nine months ended September 30, 2021~~ and ~~2020,~~ depreciation and amortization expense ~~was $0.7 million.~~ were both flat, at $0.3 million and $0.2 million, respectively.

For the ~~nine~~three months ended ~~September 30, 2021,~~March 31, 2022, other expenses were ~~$17.7~~$6.2 million, compared to ~~$15.3~~$5.6 million in ~~2020~~2021, with the ~~$2.4~~$0.6 million increase driven by increased loan origination expenses, including marketing costs.

Income before taxes for the three months ended ~~September 30, 2021~~March 31, 2022 was ~~$6.3~~$4.3 million, compared to income before taxes of ~~$14.5~~$13.1 million in ~~2020.~~2021. The primary driver of the decrease was a decline ~~was lower volume~~in volumes and ~~gain on sale~~ margins, ~~as compared to the 2020 period.~~

The following tables present a summary of Tiptree Capital - Other results for the ~~three and nine months ended September 30, 2021 and 2020.~~following periods:

Tiptree Capital - Other earns revenues from the following sources: net interest income; revenues on our held for sale mortgage originator; realized and unrealized gains and losses on the Company’s investment holdings (primarily Invesque); and charter revenue from vessels within the Company’s maritime transportation operations.

Revenues for the three months ended ~~September 30, 2021~~March 31, 2022 were ~~$12.5~~$17.0 million compared to ~~revenues of $14.2~~$37.6 million for ~~2020.~~2021. The primary ~~drivers~~driver of the ~~change~~decrease in revenues ~~were~~for the three months ended March 31, 2022 was unrealized losses on our investment in Invesque ~~of $10.4 million~~ in ~~the 2021 period~~2022 compared to unrealized ~~losses of $7.6 million~~gains in ~~the 2020 period and lower mortgage gain on sale revenues in the held for sale mortgage originator,~~2021, partially offset by increased dry-bulk and tanker charter rates earned by the maritime transportation business.

~~For the three months ended September 30, 2021, the~~The loss before taxes from Tiptree Capital - Other was $4.7 million, compared to a loss before taxes of $5.0 million in 2020. The primary drivers were unrealized losses in the 2021 and 2020 periods on the investment in Invesque. Maritime transportation operations earned higher income before taxes in 2021 compared to 2020 driven by increased revenues from higher dry-bulk charter rates.

Adjusted net income increased to ~~$8.2~~$2.5 million for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022 compared to ~~$3.6~~$0.6 million in ~~2020.~~2021. The increase was driven by the improvement in maritime transportation ~~operations from higher dry-bulk charter rates, partially offset by the impact of the discontinuation of the Invesque dividend in April 2020.~~operations.

The following table presents a summary of corporate results for the ~~three and nine months ended September 30, 2021 and 2020.~~following periods:

Employee compensation and benefits, including incentive compensation expense, was ~~$16.4~~$7.0 million for the ~~nine~~three months ended ~~September 30, 2021~~March 31, 2022, compared to ~~$10.1~~$5.6 million for ~~2020,~~2021, driven by an increase in performance related employee incentive compensation. Of the incentive compensation expense in the three months ended March 31, 2022, $3.8 million was stock-based compensation expense primarily related to awards tied to the increase in Tiptree’s stock price over the past twelve months. Interest expense for the ~~nine~~three months ended ~~September 30,~~March 31, 2022 and 2021 was ~~$7.7~~$2.2 million ~~up from $7.4~~and $2.6 million, ~~in 2020, driven by a higher average outstanding balance during the first quarter of 2021 associated with upsizing the borrowing facility in February 2020.~~respectively. As of ~~September 30, 2021,~~March 31, 2022, the outstanding borrowing on the facility was ~~$115.6~~$112.5 million, compared to ~~$120.3~~$114.1 million at December 31, ~~2020.~~2021. Other expenses of ~~$8.5~~$2.8 million increased by ~~$1.4~~$1.0 million from the ~~nine~~three months ended ~~September 30, 2020~~March 31, 2021, primarily driven by ~~$2.2 million of non-recurring~~increased consulting, legal and professional and legal fees associated with preparation of the registration statement for the potential Fortegra initial public offering in 2021 (which registration statement has been withdrawn), compared to $0.4 million of non-recurring debt extinguishment fees associated with the refinancing of the corporate credit facility in the prior year.fees.

The total income tax ~~expense~~benefit of ~~$0.2~~$0.1 million for the three months ended ~~September 30, 2021,~~March 31, 2022, and the total income tax ~~benefit~~expense of ~~$0.8~~$8.8 million for the three months ended ~~September 30, 2020~~March 31, 2021 are reflected as components of net income (loss).

For the three months ended ~~September 30, 2021,~~March 31, 2022, the Company’s effective tax rate was equal to ~~6.6%~~9.0%. The effective rate for the three months ended ~~September 30, 2021~~March 31, 2022 was lower than the U.S. ~~federal~~ statutory income tax rate of 21.0%, primarily from the impact of ~~the effect of foreign operations~~non-deductible compensation and other discrete ~~items, partially offset by state taxes.~~items. For the three months ended ~~September 30, 2020,~~March 31, 2021, the Company’s effective tax rate was equal to ~~(6.1)%~~22.2%. The effective rate for the three months ended ~~September 30, 2020 was lower than the U.S. federal statutory income tax rate of 21.0% due to the effect of discrete items, including expected refunds arising from the CARES Act.~~

Tiptree’s total assets were ~~$3,378.4~~$3,600.2 million as of ~~September 30, 2021,~~March 31, 2022, compared to ~~$2,995.8~~$3,599.1 million as of December 31, ~~2020.~~2021. The ~~$382.6~~$1.1 million increase in assets is primarily attributable to the growth in the Insurance ~~segment.~~segment, partially offset by unrealized losses on investments.

Total stockholders’ equity was ~~$402.1~~$383.2 million as of ~~September 30, 2021,~~March 31, 2022, compared to ~~$373.5~~$400.2 million as of December 31, ~~2020,~~2021, primarily driven by ~~net income~~the comprehensive loss on available for ~~nine~~sale securities attributable to common stockholders for three months ended ~~September 30, 2021, partially offset by dividends.~~March 31, 2022. As of ~~September 30, 2021,~~March 31, 2022, there were ~~33,888,810~~34,877,897 shares of common stock outstanding as compared to ~~32,682,462~~34,124,153 as of December 31, ~~2020.~~2021, with the increase driven by the exercise of warrants and the vesting of share-based incentive compensation.

In addition to GAAP results, management uses the non-GAAP financial measures underwriting and fee revenues and underwriting and fee margin in order to better explain to investors the underwriting performance ~~of the Company’s programs~~ and the respective retentions between the Company and its agents and reinsurance partners. We also use the non-GAAP financial measures adjusted net income, adjusted return on average equity and Adjusted EBITDA as measures of operating performance and as part of our resource and capital allocation process, to assess comparative returns on invested capital. Adjusted EBITDA is also used in determining incentive compensation for the Company’s executive officers. Management believes these measures provide supplemental information useful to investors as they are frequently used by the financial community to analyze financial performance and to compare relative performance among comparable companies. Adjusted net income, adjusted return on average equity, Adjusted EBITDA, underwriting and fee revenues and underwriting and fee margin are not measurements of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for earned premiums, net income or any other measure derived in accordance with GAAP.

The following tables present ~~program specific~~ revenue and expenses by business mix. We generally manage exposure to ~~the assumed~~ underwriting ~~risk~~risks written by using both reinsurance (e.g., quota share and excess of loss) and retrospective commission agreements with our partners (e.g., commissions paid are adjusted based on the actual underlying losses incurred), which mitigates Fortegra’s risk. Period-over-period comparisons of revenues and expenses are often impacted by the PORCs and distribution partners’ choice as to whether to retain risk, specifically service and administration fees and ceding commissions, both components of revenue, and policy and contract benefits and commissions paid to our partners and reinsurers. Generally, when losses are incurred, the risk which is retained by our partners and reinsurers is reflected in a reduction in commissions paid. In order to better explain to investors the underwriting performance ~~of the Company’s programs~~ and the respective retentions between the Company and its agents and reinsurance partners, we use the non-GAAP metrics underwriting and fee revenues and underwriting and fee margin.

We define underwriting and fee revenues as total revenues from the Insurance segment excluding net investment income and net realized and unrealized gains (losses). Underwriting and fee revenues represents revenues generated by underwriting and fee-based operations and allows us to evaluate the Company’s underwriting performance without regard to investment income. We use this metric as we believe it gives our management and other users of our financial information useful insight into our underlying business performance. Underwriting and fee revenues should not be viewed as a substitute for total revenues calculated in accordance with GAAP, and other companies may define underwriting and fee revenues differently.

We define underwriting and fee margin as income before taxes from the Insurance segment, excluding net investment income, net realized and unrealized gains (losses), employee compensation and benefits, other expenses, interest expense and depreciation and amortization. Underwriting and fee margin represents the underwriting performance of our underwriting and fee-based ~~programs.~~lines. As such, underwriting and fee margin excludes general administrative expenses, interest expense, depreciation and amortization and other corporate expenses as those expenses support the vertically integrated business model and not any individual component of the Company’s business mix. We use this metric as we believe it gives our management and other users of our financial information useful insight into the specific performance of our underlying ~~underwriting and fee program.~~business mix. Underwriting and fee margin should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define underwriting and fee margin differently.

We define adjusted net income as income before taxes, less provision (benefit) for income taxes, and excluding the after-tax impact of various expenses that we consider to be unique and non-recurring in nature, including merger and acquisition

related expenses, stock-based compensation, net realized and unrealized gains (losses) and intangibles amortization associated with purchase accounting. We use adjusted net income as an internal operating performance measure in the management of business as part of our capital allocation process. We believe adjusted net income provides useful supplemental information to investors as it is frequently used by the financial community to analyze financial performance between periods and for comparison among companies. Adjusted net income should not be viewed as a substitute for income before taxes calculated in accordance with GAAP, and other companies may define adjusted net income differently.

We present adjustments for amortization associated with acquired intangible assets. The intangible assets were recorded as part of purchase accounting in connection with Tiptree’s acquisition of ~~FFC~~Fortegra Financial in 2014, Defend in 2019, and Smart AutoCare and Sky Auto in 2020. The intangible assets acquired contribute to overall revenue generation, and the respective purchase accounting adjustments will continue to occur in future periods until such intangible assets are fully amortized in accordance with the respective amortization periods required by GAAP.

We define adjusted return on average equity as adjusted net income expressed on an annualized basis as a percentage of average beginning and ending stockholders’ equity during the period. See “—Adjusted Net Income—Non-GAAP” above. We use adjusted return on average equity as an internal performance measure in the management of our operations because we believe it gives our management and other users of our financial information useful insight into our results of operations and our underlying business performance. Adjusted return on average equity should not be viewed as a substitute for return on average equity calculated in accordance with GAAP, and other companies may define adjusted return on average equity differently.

The Company defines Adjusted EBITDA as GAAP net income of the Company plus corporate interest expense, plus income taxes, plus depreciation and amortization expense, less the effects of purchase accounting, plus non-cash fair value adjustments, plus significant non-recurring expenses, and plus unrealized gains (losses) on available for sale securities reported in other comprehensive income. Adjusted EBITDA is used to determine incentive compensation for the Company’s executive officers. Adjusted EBITDA is not a measurement of financial performance or liquidity under GAAP and should not be considered as an alternative or substitute for GAAP net income.

Management believes the use of this financial measure provides supplemental information useful to investors as book value is frequently used by the financial community to analyze company growth on a relative per share basis. The following table provides a reconciliation between total stockholders’ equity and total shares outstanding, net of treasury shares.

Our principal sources of liquidity are unrestricted cash, cash equivalents and other liquid investments and distributions from operating subsidiaries, including income from our investment portfolio and sales of assets and investments. We intend to use our cash resources to continue to fund our operations and grow our businesses. We may seek additional sources of cash to fund acquisitions or investments. These additional sources of cash may take the form of debt or equity and may be at the parent, subsidiary or asset level. We are a holding company and our liquidity needs are primarily for interest payments on the Fortress credit facility, compensation, professional fees, office rent and insurance costs. In February 2020, we refinanced our existing facility with Fortress, extending the maturity to February 2025 and increasing the principal amount to $125 million, generating approximately $53 million of cash after repaying the existing facility and expenses. A portion of those funds were invested in ~~Insurance~~Fortegra to fund ~~warranty operations,~~growth, with the remainder used to provide additional liquidity. As a condition to the closing of the WP Transaction, the Company is required to assign the Fortress credit facility to Fortegra, which would use proceeds from the WP Transaction to pay the unpaid principal balance of the Fortress credit facility. In addition, on or prior to the closing of the WP Transaction, Fortegra would have certain of its subsidiaries repay $30.0 million principal balance of aggregate intercompany promissory notes to Tiptree Holdings LLC, plus accrued interest.

Our subsidiaries’ ability to generate sufficient net income and cash flows to make cash distributions will be subject to numerous business and other factors, including restrictions contained in agreements for the strategic investment by Warburg

Pincus in Fortegra, our subsidiaries’ financing agreements, regulatory restrictions, availability of sufficient funds at such subsidiaries, general economic and business conditions, tax considerations, strategic plans, financial results and other factors such as target capital ratios and ratio levels anticipated by rating agencies to maintain or improve current ratings. We expect

As of ~~September 30, 2021,~~March 31, 2022, cash and cash equivalents, excluding restricted cash, were ~~$150.5~~$178.0 million, compared to ~~$136.9~~$175.7 million at December 31, ~~2020,~~2021, an increase of ~~$13.6~~$2.2 million primarily as a result of additional ~~invested assets~~gross written premium and premium equivalents at Fortegra.

Our mortgage business relies on short term uncommitted sources of financing as a part of their normal course of operations. To date, we have been able to obtain and renew uncommitted warehouse credit facilities. If we were not able to obtain financing, then we may need to draw on other sources of liquidity to fund our mortgage business. See Note ~~(11)~~(10) Debt, net in the notes to condensed consolidated financial statements, for additional information regarding our mortgage warehouse borrowings.

We believe that cash flow from operations will provide sufficient capital to continue to grow the business and fund interest on the outstanding debt, capital expenditures and other general corporate needs over the next several years. As we continue to expand our business, including by any acquisitions we may make, we may, in the future, require additional working capital for increased costs.

For purposes of determining enterprise value and Adjusted EBITDA, we consider corporate credit agreements and preferred trust securities, which we refer to as corporate debt, as corporate financing and associated interest expense is added back. The below table outlines this amount by debt outstanding and interest expense at the insurance company and corporate level.

As of ~~September 30, 2021,~~March 31, 2022, the ~~$115.6 million~~ credit facility with Fortress carries a rate of LIBOR (with a minimum LIBOR rate of 1.0%), plus a margin of 6.75% per annum. The agreement requires quarterly principal payments of approximately $1.56 million. See Note ~~(11)~~(10) Debt, net in the notes to condensed consolidated financial statements for details.

Cash provided by operating activities was ~~$186.0~~$149.1 million for the ~~nine~~three months ended ~~September 30,~~March 31, 2022. In 2022, the primary sources of cash from operating activities included proceeds from mortgage loans outpacing originations and growth in insurance unearned premiums and deferred revenues, partially offset by increases in deferred acquisition costs and reinsurance receivables.

Cash provided by operating activities was $27.3 million for the three months ended March 31, 2021. In 2021, the primary sources of cash from operating activities included consolidated net income (excluding unrealized gains and losses), proceeds from mortgage loans outpacing originations and growth in unearned premiums and net deferred revenues, partially offset by increases in deferred acquisition costs and other assets in addition to decreases in other liabilities and accrued ~~expenses.~~

Cash used in investing activities was ~~$201.3~~$18.7 million for the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022. In ~~2021,~~2022, the primary use of cash from investing activities was the purchase of investments outpacing proceeds from the sales of investments in our insurance investment portfolio, and the issuance of notes receivable outpacing proceeds.

Cash used in investing activities was ~~$65.4~~$42.4 million for the ~~year ended nine~~three months ended ~~September 30, 2020.~~March 31, 2021. In ~~2020,~~2021, the primary use of cash from investing activities was the purchase of investments outpacing proceeds from the sales of investments in our insurance investment portfolio, and the issuance of notes ~~receivables~~receivable outpacing proceeds. ~~This was partially offset by proceeds received in connection with the acquisition of Smart AutoCare.~~

Cash used in financing activities was ~~$0.5~~$124.7 million for the ~~nine~~three months ended ~~September 30,~~March 31, 2022. In 2022, principal repayments on mortgage warehouse facilities exceeded proceeds from borrowings.

Cash used in financing activities was $0.6 million for the three months ended March 31, 2021. In 2021, the primary use of cash from financing activities was the repurchase of ~~$2.9~~$2.5 million of the Company’s common stock ~~repurchase of $1.1 million of vested subsidiary awards,~~and the payment of ~~$4.0~~$1.3 million in dividends, which was partially offset by proceeds from borrowings in excess of principal repayments in ~~the mortgage business.~~

Our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020~~2021 described our Quantitative and Qualitative Disclosures About Market Risk. There were no material changes to the assumptions or risks during the ~~nine~~three months ended ~~September 30, 2021.~~March 31, 2022.

The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (Exchange Act) as of the end of the period covered by this report. The Company’s disclosure controls and procedures are designed to provide reasonable assurance that material information is recorded, processed, summarized and reported accurately and on a timely basis. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective.

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d- 15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Our legal proceedings are discussed under the heading “Litigation” in Note ~~(21) —~~(20) Commitments and Contingencies in the Notes to the condensed consolidated financial statements in this report.

For information regarding factors that could affect our Company, results of operations and financial condition, see the risk factors discussed under Part I, Item 1A in our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2020.~~2021. There have been no material changes in those risk factors.


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
common stock, par value $0.001 per share	TIPT	NASDAQ	Capital Market


ITEM						Page Number
PART I. Financial Information						F- 1
Item 1. Financial Statements (Unaudited)						F- 3
Condensed Consolidated Balance Sheets as of ~~September~~ 30March 31, 2022~~, 2021~~ and December 31, ~~2020~~202 1						F- 3
Condensed Consolidated Statements of Operations for the three ~~and~~ ~~nine~~months ended ~~September~~ ~~30,~~March 31, 2022 and 2021 ~~and 2020~~						F- 4
Condensed Consolidated Statements of Comprehensive Income (Loss) for the three ~~and~~ ~~nine~~months ~~months~~ ended ~~September~~March 31, 2022 30and 202 ~~, 2021 and 2020~~1						F- 5
Condensed Consolidated Statements of Changes in Stockholders’ Equity for the periods ended ~~September~~ 30March 21 , ~~2021~~202 2 and ~~2020~~202 1						F- 6
Condensed Consolidated Statements of Cash Flows for the ~~nine~~three months ended ~~September~~March 3031 , ~~2021~~202 2 and ~~2020~~202 1						F- 87
Notes to Condensed Consolidated Financial Statements						F- 98
(1) Organization						F- 98
(2) Summary of Significant Accounting Policies						F- 98
~~(3) Acquisitions~~						F- 10
~~(4)~~(3 ) Assets and Liabilities Held for Sale						F- 119
~~(5)~~(4 ) Operating Segment Data						F- 129
~~(6)~~(5 ) Investments						F- 1411
~~(7)~~(6 ) Notes and Accounts Receivable, net						F- 17
(7 ) Reinsurance Receivables						F- 17
(8 ) Goodwill and Intangible Assets, net						F- 19
(9 ) Derivative Financial Instruments and Hedging						F- 20
~~(8) Reinsurance Receivables~~(1						F- 210
~~(9) Goodwill and Intangible Assets, net~~						F- 24
~~(10) Derivative Financial Instruments and Hedging~~						F- 25
~~(11)~~) Debt, net						F- 2622
~~(12)~~(1 1 ) Fair Value of Financial Instruments						F- 2723
~~(13)~~(1 2 ) Liability for Unpaid Claims and Claim Adjustment Expenses						F- 3430
~~(14)~~(1 3 ) Revenue from Contracts with Customers						F- 3531
~~(15)~~(1 4 ) Other Assets and Other Liabilities and Accrued Expenses						F- 3632
~~(16)~~(1 5 ) Other Revenue and Other Expenses						F- 3733
~~(17)~~(1 6 ) Stockholders’ Equity						F- 3834
~~(18)~~(1 7 ) Accumulated Other Comprehensive Income (Loss)						F- 35
(1 8 ) Stock Based Compensation						F- 35
(1 9 ) Income Taxes						F- 39
~~(19) Stock Based Compensation~~(2 0 ) Commitments and Contingencies						F- 39
(2 1 ) Earnings Per Share						F- 40
~~(20) Income Taxes~~(2						F- 432
~~(21) Commitments and Contingencies~~						F- 44
~~(22) Earnings Per Share~~						F- 45
~~(23)~~) Related Party Transactions						F- 4540
~~(24)~~(2 3 ) Subsequent Events						F- 4641
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations						142
Item 3. Quantitative and Qualitative Disclosures About Market Risk						2662
Item 4. Controls and Procedures						2663

PART II. Other Information						2664
Item 1. Legal Proceedings						2664
Item 1A. Risk Factors						2664
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds						2664
Item 3. Defaults Upon Senior Securities						2764
Item 4. Mine Safety Disclosures						2764
Item 5. Other Information						2764
Item 6. Exhibits, Financial Statement Schedules						2764
Signatures						2865


	As of
	September 30, 2021		December 31, 2020
Assets:
Investments:
Available for sale securities, at fair value, net of allowance for credit losses	$	541,121	$	377,133
Loans, at fair value	89,326		90,732
Equity securities	139,418		123,838
Other investments	168,829		219,701
Total investments	938,694		811,404
Cash and cash equivalents	150,496		136,920
Restricted cash	21,588		58,355
Notes and accounts receivable, net	443,150		370,452
Reinsurance receivables	827,199		728,009
Deferred acquisition costs	352,940		229,430
Goodwill	179,103		179,236
Intangible assets, net	126,649		138,215
Other assets	152,938		162,034
Assets held for sale	185,595		181,705
Total assets	$	3,378,352	$	2,995,760

Liabilities and Stockholders’ Equity
Liabilities:
Debt, net	$	374,842	$	366,246
Unearned premiums	1,053,120		860,690
Policy liabilities and unpaid claims	313,614		233,438
Deferred revenue	511,273		399,211
Reinsurance payable	239,499		224,660
Other liabilities and accrued expenses	305,519		362,865
Liabilities held for sale	178,343		175,112
Total liabilities	$	2,976,210	$	2,622,222


Stockholders’ Equity:
Preferred stock: $0.001 par value, 100,000,000 shares authorized, none issued or outstanding	$	—	$	—
Common stock: $0.001 par value, 200,000,000 shares authorized, 33,888,810 and 32,682,462 shares issued and outstanding, respectively	34		33
Additional paid-in capital	314,060		315,014
Accumulated other comprehensive income (loss), net of tax	1,157		5,674
Retained earnings	69,961		35,423

Total Tiptree Inc. stockholders’ equity	385,212		356,144
Non-controlling interests	16,930		17,394
Total stockholders’ equity	402,142		373,538
Total liabilities and stockholders’ equity	$	3,378,352	$	2,995,760


	As of
	March 31, 2022		December 31, 2021


Assets:
Investments:
Available for sale securities, at fair value, net of allowance for credit losses	$	568,460	$	577,448
Loans, at fair value	96,244		105,583
Equity securities	120,895		138,483
Other investments	132,305		168,656
Total investments	917,904		990,170
Cash and cash equivalents	177,962		175,718
Restricted cash	19,567		19,368
Notes and accounts receivable, net	536,133		454,369
Reinsurance receivables	949,952		880,836
Deferred acquisition costs	414,752		379,373
Goodwill	179,103		179,103
Intangible assets, net	119,357		122,758
Other assets	147,217		146,844
Assets held for sale	138,251		250,608
Total assets	$	3,600,198	$	3,599,147

Liabilities and Stockholders’ Equity
Liabilities:
Debt, net	$	391,326	$	393,349
Unearned premiums	1,188,764		1,123,952
Policy liabilities and unpaid claims	393,877		331,703
Deferred revenue	560,316		534,863
Reinsurance payable	273,314		265,569
Other liabilities and accrued expenses	292,115		306,536
Liabilities held for sale	117,333		242,994
Total liabilities	$	3,217,045	$	3,198,966


Stockholders’ Equity:
Preferred stock: $0.001 par value, 100,000,000 shares authorized, none issued or outstanding	$	—	$	—
Common stock: $0.001 par value, 200,000,000 shares authorized, 34,877,897 and 34,124,153 shares issued and outstanding, respectively	35		34
Additional paid-in capital	323,916		317,459
Accumulated other comprehensive income (loss), net of tax	(23,106)		(2,685)
Retained earnings	65,788		68,146
Total Tiptree Inc. stockholders’ equity	366,633		382,954
Non-controlling interests	16,520		17,227
Total stockholders’ equity	383,153		400,181
Total liabilities and stockholders’ equity	$	3,600,198	$	3,599,147


	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020			2021		2020
Revenues:
Earned premiums, net	$	175,026	$	116,418		$	498,903	$	344,994
Service and administrative fees	69,664		47,701			191,414		134,290
Ceding commissions	2,722		5,157			8,827		16,217
Net investment income	3,330		3,023			9,331		8,803
Net realized and unrealized gains (losses)	14,805		38,959			120,268		6,628
Other revenue	21,058		12,783			52,237		41,974
Total revenues	286,605		224,041			880,980		552,906
Expenses:
Policy and contract benefits	80,831		57,738			237,198		167,761
Commission expense	104,392		68,868			292,580		207,172
Employee compensation and benefits	48,643		45,715			147,260		124,894
Interest expense	8,657		8,321			26,890		23,518
Depreciation and amortization	6,119		4,010			18,261		12,244
Other expenses	34,379		25,492			104,340		80,737
Total expenses	283,021		210,144			826,529		616,326






Income (loss) before taxes	3,584		13,897			54,451		(63,420)
Less: provision (benefit) for income taxes	237		(844)			11,416		(22,030)







Net income (loss)	3,347		14,741			43,035		(41,390)

Less: net income (loss) attributable to non-controlling interests	1,339		1,978			4,477		2,038
Net income (loss) attributable to common stockholders	$	2,008	$	12,763		$	38,558	$	(43,428)

Net income (loss) per common share:


Basic earnings per share	$	0.06	$	0.37		$	1.15	$	(1.27)



Diluted earnings per share	$	0.06	$	0.35		$	1.11	$	(1.27)

Weighted average number of common shares:
Basic	33,558,106		33,684,301			32,963,451		34,076,837
Diluted	34,132,182		33,684,301			35,025,211		34,076,837

Dividends declared per common share	$	0.04	$	0.04		$	0.12	$	0.12


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


	Three Months Ended March 31,
	2022		2021
Revenues:
Earned premiums, net	$	208,416	$	146,919
Service and administrative fees	71,835		58,050
Ceding commissions	2,537		3,025
Net investment income	3,167		2,767
Net realized and unrealized gains (losses)	17,204		69,371
Other revenue	21,744		14,556
Total revenues	324,903		294,688
Expenses:
Policy and contract benefits	104,446		67,174
Commission expense	117,423		88,645
Employee compensation and benefits	56,455		52,924
Interest expense	10,199		9,252
Depreciation and amortization	6,156		5,934
Other expenses	31,176		31,367
Total expenses	325,855		255,296






Income (loss) before taxes	(952)		39,392
Less: provision (benefit) for income taxes	(86)		8,752







Net income (loss)	(866)		30,640

Less: net income (loss) attributable to non-controlling interests	94		2,059
Net income (loss) attributable to common stockholders	$	(960)	$	28,581

Net income (loss) per common share:


Basic earnings per share	$	(0.03)	$	0.86



Diluted earnings per share	$	(0.03)	$	0.81

Weighted average number of common shares:
Basic	34,229,011		32,420,982
Diluted	34,229,011		36,184,019

Dividends declared per common share	$	0.04	$	0.04


		Common stock																Common stock
		Number of shares	Par value		Additional paid-in capital		Accumulated other comprehensive income (loss)		Retained earnings		Total Tiptree Inc. stockholders’ equity		Non-controlling interests		Total stockholders' equity			Number of shares	Par value		Additional paid-in capital		Accumulated other comprehensive income (loss)		Retained earnings		Total Tiptree Inc. stockholders’ equity		Non-controlling interests		Total stockholders' equity
Balance at December 31, 2020		32,682,462	$	33	$	315,014	$	5,674	$	35,423	$	356,144	$	17,394	$	373,538
Balance at December 31, 2021																	Balance at December 31, 2021	34,124,153	$	34	$	317,459	$	(2,685)	$	68,146	$	382,954	$	17,227	$	400,181

Amortization of share-based incentive compensation	Amortization of share-based incentive compensation	—	—		1,759		—		—		1,759		1,263		3,022		Amortization of share-based incentive compensation	—	—		3,162		—		—		3,162		576		3,738
Vesting of share-based incentive compensation	Vesting of share-based incentive compensation	369,556	—		184		—		—		184		(4,816)		(4,632)		Vesting of share-based incentive compensation	261,449	—		(127)		—		—		(127)		(994)		(1,121)
Shares issued in exchange for vested subsidiary awards (1)		1,158,009	2		657		—		—		659		(709)		(50)
Shares purchased under stock purchase plan		(528,662)	(1)		(2,881)		—		—		(2,882)		—		(2,882)

Shares issued upon exercise of warrants	Shares issued upon exercise of warrants	207,445	—		—		—		—		—		—		—		Shares issued upon exercise of warrants	492,295	1		3,422		—		—		3,423		—		3,423
Repurchase of vested subsidiary awards		—	—		(770)		—		—		(770)		(309)		(1,079)

Non-controlling interest contributions	Non-controlling interest contributions	—	—		—		—		—		—		100		100		Non-controlling interest contributions	—	—		—		—		—		—		250		250

Non-controlling interest distributions	Non-controlling interest distributions	—	—		—		—		—		—		(355)		(355)		Non-controlling interest distributions	—	—		—		—		—		—		(583)		(583)
Net change in non-controlling interest		—	—		97		—		—		97		(97)		—

Dividends declared	Dividends declared	—	—		—		—		(4,020)		(4,020)		—		(4,020)		Dividends declared	—	—		—		—		(1,398)		(1,398)		—		(1,398)
Other comprehensive income (loss), net of tax	Other comprehensive income (loss), net of tax	—	—		—		(4,517)		—		(4,517)		(18)		(4,535)		Other comprehensive income (loss), net of tax	—	—		—		(20,421)		—		(20,421)		(50)		(20,471)
Net income (loss)	Net income (loss)	—	—		—		—		38,558		38,558		4,477		43,035		Net income (loss)	—	—		—		—		(960)		(960)		94		(866)
Balance at September 30, 2021		33,888,810	$	34	$	314,060	$	1,157	$	69,961	$	385,212	$	16,930	$	402,142
Balance at March 31, 2022																	Balance at March 31, 2022	34,877,897	$	35	$	323,916	$	(23,106)	$	65,788	$	366,633	$	16,520	$	383,153

Balance at June 30, 2021		33,395,395	$	33	$	314,983	$	2,689	$	69,313	$	387,018	$	18,031	$	405,049
Amortization of share-based incentive compensation		—	—		570		—		—		570		481		1,051
Vesting of share-based incentive compensation		11,586	—		103		—		—		103		(4,132)		(4,029)
Shares issued in exchange for vested subsidiary awards		481,829	1		(1,634)		—		—		(1,633)		1,633		—

Repurchase of vested subsidiary awards		—	—		10		—		—		10		(33)		(23)
Non-controlling interest distributions		—	—		—		—		—		—		(355)		(355)
Net change in non-controlling interests		—	—		28		—		—		28		(28)		—
Dividends declared		—	—		—		—		(1,360)		(1,360)		—		(1,360)
Other comprehensive income (loss), net of tax		—	—		—		(1,532)		—		(1,532)		(6)		(1,538)
Net income (loss)		—	—		—		—		2,008		2,008		1,339		3,347
Balance at September 30, 2021		33,888,810	$	34	$	314,060	$	1,157	$	69,961	$	385,212	$	16,930	$	402,142


	Three Months Ended March 31,
	2022		2021
Operating Activities:
Net income (loss) attributable to common stockholders	$	(960)	$	28,581
Net income (loss) attributable to non-controlling interests	94		2,059
Net income (loss)	(866)		30,640
Adjustments to reconcile net income to net cash provided by (used in) operating activities
Net realized and unrealized (gains) losses	(17,204)		(69,371)
Net (gain) loss on held for sale of business	(1,752)		431
Non-cash compensation expense	6,170		1,065
Amortization/accretion of premiums and discounts	654		670
Depreciation and amortization expense	6,156		5,934
Non-cash lease expense	2,420		2,195
Deferred provision (benefit) for income taxes	(54)		7,788
Amortization of deferred financing costs	407		394
Other	69		80
Changes in operating assets and liabilities:
Mortgage loans originated for sale	(972,051)		(911,193)
Proceeds from the sale of mortgage loans originated for sale	1,141,727		956,609
(Increase) decrease in notes and accounts receivable	(72,105)		24,507
(Increase) decrease in reinsurance receivables	(69,116)		14,279
(Increase) decrease in deferred acquisition costs	(35,379)		(43,494)
(Increase) decrease in other assets	4,653		(4,101)
Increase (decrease) in unearned premiums	64,812		31,319
Increase (decrease) in policy liabilities and unpaid claims	62,174		17,885
Increase (decrease) in deferred revenue	25,453		25,397
Increase (decrease) in reinsurance payable	7,745		(23,329)
Increase (decrease) in other liabilities and accrued expenses	(4,846)		(40,375)
Net cash provided by (used in) operating activities	149,067		27,330
Investing Activities:
Purchases of investments	(333,311)		(413,159)
Proceeds from sales and maturities of investments	322,923		372,015
Proceeds from the sale of real estate and other assets	583		—
Purchases of property, plant and equipment	(535)		(397)
Proceeds from the sale of businesses	—		125
Proceeds from notes receivable	17,098		14,762
Issuance of notes receivable	(25,490)		(15,710)

Net cash provided by (used in) investing activities	(18,732)		(42,364)
Financing Activities:
Dividends paid	(1,398)		(1,326)
Cash received for the exercise of warrants	3,423		—
Net non-controlling interest (redemptions) contributions	(1,566)		100


Payment of debt issuance costs	(5)		—
Proceeds from borrowings and mortgage notes payable	1,020,790		955,306
Principal paydowns of borrowings and mortgage notes payable	(1,145,947)		(952,260)
Repurchases of common stock and other changes in additional paid-in capital	—		(2,450)
Net cash provided by (used in) financing activities	(124,703)		(630)
Net increase (decrease) in cash, cash equivalents and restricted cash	5,632		(15,664)
Cash, cash equivalents and restricted cash – beginning of period	195,086		195,275
Cash, cash equivalents and restricted cash – beginning of period - held for sale	9,360		4,879
Cash, cash equivalents and restricted cash – end of period	210,078		184,490
Less: Reclassification of cash to assets held for sale	12,549		7,317
Cash, cash equivalents and restricted cash – end of period	$	197,529	$	177,173





Supplemental Schedule of Non-Cash Investing and Financing Activities:
Right of use asset obtained in exchange for lease liability	$	5,830	$	1,413
Corporate loans and equity securities exchanged for trade receivables	$	19,846	$	—




	As of
Reconciliation of cash, cash equivalents and restricted cash	March 31, 2022		December 31, 2021
Cash and cash equivalents	$	177,962	$	175,718
Restricted cash	19,567		19,368
Total cash, cash equivalents and restricted cash shown in the statements of cash flows	$	197,529	$	195,086


Standard	Description	Adoption Date	Impact on Financial Statements

~~2019-12 Income Taxes (Topic 740): Simplifying the~~ Accounting ~~for Income Taxes~~Standard Updates (ASU) 2020-06 Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging - Contracts in Entity’s Own Equity (Subtopic 815-40)	The standard ~~eliminates~~simplifies the ~~need for an organization to analyze whether the following apply in a given period: (1) exceptions to the incremental approach for intraperiod tax allocation, (2) exceptions to~~ accounting for ~~basis differences when there~~certain financial instruments. The guidance reduces the number of accounting models for convertible debt instruments by eliminating the cash conversion and beneficial conversion models and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are ~~ownership changes~~indexed to and settled in ~~foreign investments and (3) exceptions in interim period income tax accounting for year-to-date losses that exceed anticipated losses.~~an entity’s own equity. The ASU ~~also~~amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. Either a full or modified retrospective method of transition is ~~designed to improve financial statement preparers’ application~~permissible for the adoption of income tax-related guidance and simplify GAAP for (1) franchise taxes that are partially based on income, (2) transactions with a government that result in a step-up in the tax basis of goodwill, (3) separate financial statements of legal entities that are not subject to tax, and (4) enacted changes in tax laws in interim periods.this standard.	January 1, ~~2021~~2022	The standard makes changes to ~~areas of tax~~the accounting for ~~transactions and situations~~convertible instruments, which dothe Company does not currently ~~apply to the Company’s activity,~~issue, so the adoption of the standard does not currently impact the Company’s condensed consolidated financial statements.


	~~2020 Acquisition~~
~~Assets:~~
~~Investments:~~
~~Available for sale securities, at fair value~~	$	~~110~~


~~Total investments~~	~~110~~
~~Cash and cash equivalents~~	~~120,934~~
~~Restricted cash~~	~~764~~
~~Notes and accounts receivable, net~~	~~6,214~~
~~Reinsurance receivables~~	~~71,337~~

~~Intangible assets, net~~	~~93,700~~
~~Other assets~~	~~34,053~~

~~Total assets~~	$	~~327,112~~

~~Liabilities:~~


~~Policy liabilities and unpaid claims~~	$	~~55,151~~
~~Deferred revenue~~	~~182,568~~
~~Reinsurance payable~~	~~27,075~~
~~Other liabilities and accrued expenses~~	~~10,860~~
~~Total liabilities~~	~~275,654~~
~~Net assets acquired~~	~~51,458~~
~~Goodwill~~	~~60,346~~
	$	~~111,804~~






~~Acquisition costs~~	$	~~3,539~~


Intangible Assets	Weighted Average Amortization Period (in Years)	Value as of acquisition date
Customer relationships	7.2	$	86,000
Software licensing	5.0	600
Trade names	13.5	7,100
Total acquired finite-lived intangible assets	7.7	$	93,700



	Three Months Ended September 30, 2021
			Tiptree Capital
	Insurance		Mortgage		Other		Total








Total revenues	$	246,706	$	27,425	$	12,474	$	286,605
Total expenses	(233,369)		(21,158)		(17,174)		(271,701)
Corporate expenses	—		—		—		(11,320)
Income (loss) before taxes	$	13,337	$	6,267	$	(4,700)	$	3,584
Less: provision (benefit) for income taxes							237
Net income (loss)							$	3,347
Less: net income (loss) attributable to non-controlling interests							1,339
Net income (loss) attributable to common stockholders							$	2,008



	Three Months Ended September 30, 2020
			Tiptree Capital
	Insurance		Mortgage		Other		Total
Total revenues	$	174,005	$	35,879	$	14,157	$	224,041
Total expenses	(160,558)		(21,426)		(19,135)		(201,119)
Corporate expenses	—		—		—		(9,025)
Income (loss) before taxes	$	13,447	$	14,453	$	(4,978)	$	13,897
Less: provision (benefit) for income taxes							(844)
Net income (loss)							$	14,741
Less: net income (loss) attributable to non-controlling interests							1,978
Net income (loss) attributable to common stockholders							$	12,763


	Nine Months Ended September 30, 2021
			Tiptree Capital
	Insurance		Mortgage		Other		Total
Total revenues	$	721,524	$	87,191	$	72,265	$	880,980
Total expenses	(671,955)		(62,072)		(59,351)		(793,378)
Corporate expenses	—		—		—		(33,151)
Income (loss) before taxes	$	49,569	$	25,119	$	12,914	$	54,451
Less: provision (benefit) for income taxes							11,416
Net income (loss)							$	43,035
Less: net income (loss) attributable to non-controlling interests							4,477
Net income (loss) attributable to common stockholders							$	38,558


	Nine Months Ended September 30, 2020
			Tiptree Capital
	Insurance		Mortgage		Other		Total
Total revenues	$	482,299	$	80,911	$	(10,304)	$	552,906
Total expenses	(481,881)		(60,143)		(49,103)		(591,127)
Corporate expenses	—		—		—		(25,199)
Income (loss) before taxes	$	418	$	20,768	$	(59,407)	$	(63,420)
Less: provision (benefit) for income taxes							(22,030)
Net income (loss)							$	(41,390)
Less: net income (loss) attributable to non-controlling interests							2,038
Net income (loss) attributable to common stockholders							$	(43,428)


	Three Months Ended March 31, 2022
			Tiptree Capital
	Insurance		Mortgage		Other		Total
Total revenues	$	282,529	$	25,401	$	16,973	$	324,903
Total expenses	(267,847)		(21,135)		(24,624)		(313,606)
Corporate expenses	—		—		—		(12,249)
Income (loss) before taxes	$	14,682	$	4,266	$	(7,651)	$	(952)
Less: provision (benefit) for income taxes							(86)
Net income (loss)							$	(866)
Less: net income (loss) attributable to non-controlling interests							94
Net income (loss) attributable to common stockholders							$	(960)


	Three Months Ended March 31, 2021
			Tiptree Capital
	Insurance		Mortgage		Other		Total
Total revenues	$	222,563	$	34,494	$	37,631	$	294,688
Total expenses	(201,035)		(21,417)		(22,637)		(245,089)
Corporate expenses	—		—		—		(10,207)
Income (loss) before taxes	$	21,528	$	13,077	$	14,994	$	39,392
Less: provision (benefit) for income taxes							8,752
Net income (loss)							$	30,640
Less: net income (loss) attributable to non-controlling interests							2,059
Net income (loss) attributable to common stockholders							$	28,581


	As of September 30, 2021										As of December 31, 2020
			Tiptree Capital										Tiptree Capital
	Insurance		Mortgage		Other		Corporate		Total		Insurance		Mortgage		Other		Corporate		Total
Total assets	$	2,832,179	$	205,878	$	314,191	$	26,104	$	3,378,352	$	2,452,798	$	217,138	$	302,068	$	23,756	$	2,995,760


	As of March 31, 2022										As of December 31, 2021
			Tiptree Capital										Tiptree Capital
	Insurance		Mortgage		Other		Corporate		Total		Insurance		Mortgage		Other		Corporate		Total
Total assets	$	3,168,813	$	182,828	$	248,852	$	(295)	$	3,600,198	$	3,002,152	$	201,134	$	384,564	$	11,297	$	3,599,147


		As of September 30, 2021											As of March 31, 2022
		Amortized cost		Allowance for Credit Losses(1)		Gross unrealized gains		Gross unrealized losses		Fair value			Amortized cost		Allowance for Credit Losses(1)		Gross unrealized gains		Gross unrealized losses		Fair value
U.S. Treasury securities and obligations of U.S. government authorities and agencies	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	303,340	$	—	$	3,128	$	(1,221)	$	305,247	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	355,764	$	—	$	74	$	(16,657)	$	339,181
Obligations of state and political subdivisions	Obligations of state and political subdivisions	54,524		—		1,308		(214)		55,618		Obligations of state and political subdivisions	55,460		(1)		171		(2,459)		53,171
Corporate securities	Corporate securities	142,153		(80)		946		(483)		142,536		Corporate securities	161,568		(263)		80		(7,972)		153,413
Asset backed securities	Asset backed securities	36,151		—		138		(2,047)		34,242		Asset backed securities	20,231		—		4		(2,711)		17,524
Certificates of deposit	Certificates of deposit	856		—		—		—		856		Certificates of deposit	2,696		—		—		—		2,696
Obligations of foreign governments	Obligations of foreign governments	2,654		(4)		6		(34)		2,622		Obligations of foreign governments	2,645		(3)		—		(167)		2,475
Total	Total	$	539,678	$	(84)	$	5,526	$	(3,999)	$	541,121	Total	$	598,364	$	(267)	$	329	$	(29,966)	$	568,460

													As of December 31, 2021
													Amortized cost		Allowance for Credit Losses(1)		Gross unrealized gains		Gross unrealized losses		Fair value
U.S. Treasury securities and obligations of U.S. government authorities and agencies												U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	352,288	$	—	$	2,087	$	(3,197)	$	351,178


		As of									As of
		September 30, 2021				December 31, 2020					March 31, 2022				December 31, 2021
		Amortized Cost		Fair Value		Amortized Cost		Fair Value			Amortized Cost		Fair Value		Amortized Cost		Fair Value
Due in one year or less	Due in one year or less	$	23,768	$	23,984	$	30,306	$	30,602	Due in one year or less	$	40,298	$	40,331	$	41,033	$	41,150
Due after one year through five years	Due after one year through five years	227,073		228,476		149,378		153,406		Due after one year through five years	284,784		272,909		269,487		268,537
Due after five years through ten years	Due after five years through ten years	55,470		55,445		26,621		27,479		Due after five years through ten years	50,081		46,659		52,561		52,000
Due after ten years	Due after ten years	197,216		198,974		125,471		129,454		Due after ten years	202,970		191,037		198,472		198,314
Asset backed securities	Asset backed securities	36,151		34,242		37,975		36,192		Asset backed securities	20,231		17,524		19,511		17,447
Total	Total	$	539,678	$	541,121	$	369,751	$	377,133	Total	$	598,364	$	568,460	$	581,064	$	577,448


		As of September 30, 2021											As of March 31, 2022
		Less Than or Equal to One Year					More Than One Year						Less Than or Equal to One Year					More Than One Year
		Fair value		Gross unrealized losses		# of Securities	Fair value		Gross unrealized losses		# of Securities		Fair value		Gross unrealized losses		# of Securities(1)	Fair value		Gross unrealized losses		# of Securities(1)
U.S. Treasury securities and obligations of U.S. government authorities and agencies	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	188,046	$	(1,059)	267	$	6,094	$	(162)	20	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	276,483	$	(13,589)	524	$	35,661	$	(3,068)	119
Obligations of state and political subdivisions	Obligations of state and political subdivisions	12,303		(203)		41	279		(11)		3	Obligations of state and political subdivisions	26,377		(2,227)		93	2,828		(232)		18
Corporate securities	Corporate securities	76,400		(483)		240	—		—		—	Corporate securities	123,495		(6,572)		430	17,396		(1,400)		72
Asset backed securities	Asset backed securities	4,195		(11)		23	3,391		(2,036)		5	Asset backed securities	11,066		(414)		67	3,800		(2,297)		7
Certificates of deposit												Certificates of deposit	1,339		—		2	—		—		—
Obligations of foreign governments	Obligations of foreign governments	1,884		(34)		6	—		—		—	Obligations of foreign governments	1,344		(71)		5	1,131		(96)		4
Total	Total	$	282,828	$	(1,790)	577	$	9,764	$	(2,209)	28	Total	$	440,104	$	(22,873)	1,121	$	60,816	$	(7,093)	220

													As of December 31, 2021
													Less Than or Equal to One Year					More Than One Year
													Fair value		Gross unrealized losses		# of Securities(1)	Fair value		Gross unrealized losses		# of Securities(1)
U.S. Treasury securities and obligations of U.S. government authorities and agencies												U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	216,378	$	(2,827)	324	$	11,920	$	(370)	47
Obligations of state and political subdivisions												Obligations of state and political subdivisions	17,190		(275)		64	1,152		(38)		5
Corporate securities												Corporate securities	99,434		(1,159)		326	9,722		(237)		45
Asset backed securities												Asset backed securities	7,454		(84)		38	2,316		(2,062)		5
Certificates of deposit												Certificates of deposit	1,339		—		2	—		—		—
Obligations of foreign governments												Obligations of foreign governments	2,278		(58)		8	—		—		—
Total												Total	$	344,073	$	(4,403)	762	$	25,110	$	(2,707)	102


	As of December 31, 2020

	Insurance				Tiptree Capital - Other				Total
	Cost		Fair Value		Cost		Fair Value		Cost		Fair Value
Invesque	$	23,339	$	5,370	$	111,491	$	25,708	$	134,830	$	31,078
Fixed income exchange traded fund	62,438		63,875		—		—		62,438		63,875
Other equity securities	38,069		28,885		—		—		38,069		28,885
Total equity securities	$	123,846	$	98,130	$	111,491	$	25,708	$	235,337	$	123,838


Other:
Net realized gains (losses) on loans (1)		16,644		11,883		42,232		26,466
Other		(231)		(1,351)		1,523		(3,510)
Total net realized gains (losses)		39,995		40,768		114,501		72,835

Net unrealized gains (losses)
Insurance:
Net change in unrealized gains (losses) on loans		(174)		157		1,313		(2,063)
Net unrealized gains (losses) on equity securities held at period end		(779)		(2,135)		14,511		(26,875)
Reclass of unrealized (gains) losses from prior periods for equity securities sold		(1,766)		281		(1,362)		17,290
Other		(6,015)		1,817		(9,302)		2,741
Tiptree Capital
Mortgage:
Net change in unrealized gains (losses) on loans		(255)		1,238		(1,080)		2,359
Other		566		957		3,632		(908)
Other:	Other:									Other:
Net change in unrealized gains (losses) on loans (1)	Net change in unrealized gains (losses) on loans (1)	1,801		1,364		(314)		1,218		Net change in unrealized gains (losses) on loans (1)	(3,581)		(1,900)
Net unrealized gains (losses) on equity securities held at period end	Net unrealized gains (losses) on equity securities held at period end	(10,396)		(7,586)		3,512		(65,970)		Net unrealized gains (losses) on equity securities held at period end	(8,850)		13,767
Other	Other	(8,172)		2,098		(5,143)		6,001		Other	683		3,197
Total net unrealized gains (losses)	Total net unrealized gains (losses)	(25,190)		(1,809)		5,767		(66,207)		Total net unrealized gains (losses)	(9,568)		26,555
Total net realized and unrealized gains (losses)	Total net realized and unrealized gains (losses)	$	14,805	$	38,959	$	120,268	$	6,628	Total net realized and unrealized gains (losses)	$	17,204	$	69,371


																												Valuation allowance								Bad Debt Expense

		Valuation allowance								Bad Debt Expense
		As of								Three Months Ended September 30,								Nine Months Ended September 30,										As of								Three Months Ended March 31,
		September 30, 2021				December 31, 2020																				March 31, 2022		December 31, 2021
								2021						2020						2021				2020											2022				2021
Notes receivable, net - premium financing program (1)	Notes receivable, net - premium financing program (1)			$	129			$	101			$	68			$	54			$	210			$	165					Notes receivable, net - premium financing program (1)	$	95			$		123			$	62		$	80

Accounts and premiums receivable, net	Accounts and premiums receivable, net	$	164			$	169			$	10			$	6			$	20			$	19				Accounts and premiums receivable, net		$	116			$	120			$	8			$	4


	Direct amount		Ceded to other companies		Assumed from other companies		Net amount		Percentage of amount - assumed to net
For the Three Months Ended September 30, 2021











Premiums written:
Life insurance	$	26,805	$	12,640	$	70	$	14,235	0.5	%
Accident and health insurance	41,735		28,701		81		13,115		0.6	%
Property and liability insurance	312,988		150,761		35,774		198,001		18.1	%
Total premiums written	381,528		192,102		35,925		225,351		15.9	%

Premiums earned:
Life insurance	19,268		9,994		295		9,569		3.1	%
Accident and health insurance	32,292		21,655		1,329		11,966		11.1	%
Property and liability insurance	226,446		121,349		48,394		153,491		31.5	%
Total premiums earned	$	278,006	$	152,998	$	50,018	$	175,026	28.6	%

For the Three Months Ended September 30, 2020
Premiums written:
Life insurance	$	19,268	$	11,551	$	414	$	8,131	5.1	%
Accident and health insurance	32,308		21,749		748		11,307		6.6	%
Property and liability insurance	229,518		154,201		51,721		127,038		40.7	%
Total premiums written	281,094		187,501		52,883		146,476		36.1	%

Premiums earned:
Life insurance	16,725		9,073		348		8,000		4.4	%
Accident and health insurance	28,134		18,502		2,413		12,045		20.0	%
Property and liability insurance	170,806		103,482		29,049		96,373		30.1	%
Total premiums earned	$	215,665	$	131,057	$	31,810	$	116,418	27.3	%



For the Nine Months Ended September 30, 2021











Premiums written:
Life insurance	$	66,109	$	34,218	$	757	$	32,648	2.3	%
Accident and health insurance	103,321		71,384		5,509		37,446		14.7	%
Property and liability insurance	839,271		416,048		167,726		590,949		28.4	%
Total premiums written	$	1,008,701	$	521,650	$	173,992	$	661,043	26.3	%

Premiums earned:
Life insurance	$	54,242	$	29,405	$	970	$	25,807	3.8	%
Accident and health insurance	91,793		61,755		6,803		36,841		18.5	%
Property and liability insurance	670,077		387,047		153,225		436,255		35.1	%
Total premiums earned	$	816,112	$	478,207	$	160,998	$	498,903	32.3	%



For the Nine Months Ended September 30, 2020
Premiums written:
Life insurance	$	46,695	$	25,905	$	1,104	$	21,894	5.0	%
Accident and health insurance	80,466		52,449		8,989		37,006		24.3	%
Property and liability insurance	584,983		361,095		96,683		320,571		30.2	%
Total premiums written	$	712,144	$	439,449	$	106,776	$	379,471	28.1	%

Premiums earned:
Life insurance	$	51,015	$	27,369	$	1,087	$	24,733	4.4	%
Accident and health insurance	88,640		58,599		9,008		39,049		23.1	%
Property and liability insurance	500,465		288,863		69,610		281,212		24.8	%
Total premiums earned	$	640,120	$	374,831	$	79,705	$	344,994	23.1	%


	As of
	~~September 30, 2021~~March 31, 2022
Total of the three largest receivable balances from non-affiliated reinsurers	$	~~110,756~~126,831


	Three Months Ended September 30, 2020				Nine Months Ended September 30,
	2021		2020		2021		2020
Amortization expense on intangible assets	$	3,892	$	2,326	$	11,690	$	7,175


	Stated maturity date	Stated interest rate or range of rates		Maximum borrowing capacity as of		As of
Debt Type				September 30, 2021		September 30, 2021		December 31, 2020
Corporate debt
Secured revolving credit agreements (1)	August 2023	Base/Swing:		$	200,000	$	1,740	$	—
		Prime +	1.25%
		LIBOR:
		LIBOR +	2.25%
Secured term credit agreements	February 2025	LIBOR (1.00% Floor) +	6.75%	115,625		115,625		120,313
Preferred trust securities	June 2037	LIBOR +	4.10%	35,000		35,000		35,000
Junior subordinated notes	October 2057	8.50%		125,000		125,000		125,000
Total corporate debt						277,365		280,313
Asset based debt (2)
Asset based revolving financing	October 2023	LIBOR +	2.75%	75,000		33,350		27,510
Residential mortgage warehouse borrowings (3)	April 2022 -	LIBOR (0.5% Floor) +	1.88%	110,000		61,798		55,994
	August 2022	to LIBOR (1.00% Floor) +	3.00%
Vessel backed term loan	November 2024	LIBOR +	4.75%	14,150		14,150		15,800
Total asset based debt						109,298		99,304
Total debt, face value						386,663		379,617
Unamortized discount, net						(1,599)		(2,035)
Unamortized deferred financing costs						(10,222)		(11,336)
Total debt, net						$	374,842	$	366,246


		As of September 30, 2021									As of March 31, 2022
		Quoted prices in active markets Level 1		Other significant observable inputs Level 2		Significant unobservable inputs Level 3		Fair value			Quoted prices in active markets Level 1		Other significant observable inputs Level 2		Significant unobservable inputs Level 3		Fair value
Assets:	Assets:									Assets:
Available for sale securities, at fair value:	Available for sale securities, at fair value:									Available for sale securities, at fair value:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	—	$	305,247	$	—	$	305,247	U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	—	$	339,181	$	—	$	339,181
Obligations of state and political subdivisions	Obligations of state and political subdivisions	—		55,618		—		55,618		Obligations of state and political subdivisions	—		53,171		—		53,171
Obligations of foreign governments	Obligations of foreign governments	—		2,622		—		2,622		Obligations of foreign governments	—		2,475		—		2,475
Certificates of deposit	Certificates of deposit	856		—		—		856		Certificates of deposit	2,696		—		—		2,696
Asset backed securities	Asset backed securities	—		33,562		680		34,242		Asset backed securities	—		17,082		442		17,524
Corporate securities	Corporate securities	—		142,536		—		142,536		Corporate securities	—		153,413		—		153,413
Total available for sale securities, at fair value	Total available for sale securities, at fair value	856		539,585		680		541,121		Total available for sale securities, at fair value	2,696		565,322		442		568,460

Loans, at fair value:	Loans, at fair value:									Loans, at fair value:
Corporate loans	Corporate loans	—		—		2,099		2,099		Corporate loans	—		5,060		14,053		19,113
Mortgage loans held for sale	Mortgage loans held for sale	—		87,227		—		87,227		Mortgage loans held for sale	—		77,131		—		77,131

Total loans, at fair value	Total loans, at fair value	—		87,227		2,099		89,326		Total loans, at fair value	—		82,191		14,053		96,244

Equity securities:	Equity securities:									Equity securities:
Invesque	Invesque	35,323		—		—		35,323		Invesque	24,116		—		—		24,116
Fixed income ETFs	Fixed income ETFs	39,694		—		—		39,694		Fixed income ETFs	51,718		—		—		51,718
Other equity securities	Other equity securities	64,366		—		35		64,401		Other equity securities	37,653		—		7,408		45,061
Total equity securities	Total equity securities	139,383		—		35		139,418		Total equity securities	113,487		—		7,408		120,895

Other investments, at fair value:	Other investments, at fair value:									Other investments, at fair value:
Corporate bonds	Corporate bonds	—		44,217		—		44,217		Corporate bonds	—		34,700		—		34,700
Derivative assets	Derivative assets	222		1,379		9,265		10,866		Derivative assets	41		5,587		3,569		9,197
Trade claims		—		—		10,974		10,974
CLOs		—		—		539		539

Other										Other	—		—		896		896
Total other investments, at fair value	Total other investments, at fair value	222		45,596		20,778		66,596		Total other investments, at fair value	41		40,287		4,465		44,793

Mortgage servicing rights (1)	Mortgage servicing rights (1)	—		—		26,361		26,361		Mortgage servicing rights (1)	—		—		37,870		37,870

Total	Total	$	140,461	$	672,408	$	49,953	$	862,822	Total	$	116,224	$	687,800	$	64,238	$	868,262

Liabilities: (2)	Liabilities: (2)									Liabilities: (2)
Securities sold, not yet purchased	Securities sold, not yet purchased	$	6,266	$	—	$	—	$	6,266	Securities sold, not yet purchased	$	3,199	$	—	$	—	$	3,199
Derivative liabilities	Derivative liabilities	0		2,907		—		2,907		Derivative liabilities	—		2,427		—		2,427
Contingent consideration payable	Contingent consideration payable	—		—		200		200		Contingent consideration payable	—		—		200		200

Total	Total	$	6,266	$	2,907	$	200	$	9,373	Total	$	3,199	$	2,427	$	200	$	5,826


	As of December 31, 2020
	Quoted prices in active markets Level 1		Other significant observable inputs Level 2		Significant unobservable inputs Level 3		Fair value
Assets:
Available for sale securities, at fair value:
U.S. Treasury securities and obligations of U.S. government authorities and agencies	$	—	$	196,303	$	—	$	196,303
Obligations of state and political subdivisions	—		44,350		—		44,350
Obligations of foreign governments	—		3,992		—		3,992
Certificates of deposit	1,355		—		—		1,355
Asset backed securities	—		35,334		858		36,192
Corporate securities	—		94,941		—		94,941
Total available for sale securities, at fair value	1,355		374,920		858		377,133

Loans, at fair value:
Corporate loans	—		—		7,795		7,795
Mortgage loans held for sale	—		82,937		—		82,937

Total loans, at fair value	—		82,937		7,795		90,732

Equity securities:
Invesque	31,078		—		—		31,078
Fixed income ETFs	63,875		—		—		63,875
Other equity securities	28,850		—		35		28,885
Total equity securities	123,803		—		35		123,838

Other investments, at fair value:
Corporate bonds	—		105,777		—		105,777
Derivative assets	2,090		232		9,207		11,529
CLOs	—		—		802		802
Total other investments, at fair value	2,090		106,009		10,009		118,108

Mortgage servicing rights (1)	—		—		14,758		14,758

Total	$	127,248	$	563,866	$	33,455	$	724,569

Liabilities: (2)
Securities sold, not yet purchased	$	16,479	$	30,158	$	—	$	46,637
Derivative liabilities	—		2,090		—		2,090
Contingent consideration payable	—		—		200		200
Total	$	16,479	$	32,248	$	200	$	48,927
(1) Included in other assets. (2) Included in other liabilities and accrued expenses.


		For the Nine Months Ended September 30,					For the Three Months Ended March 31,
		2021		2020			2022		2021
Balance at January 1,	Balance at January 1,	$	33,455	$	32,470	Balance at January 1,	$	61,443	$	33,455
Net realized and unrealized gains or losses included in:	Net realized and unrealized gains or losses included in:					Net realized and unrealized gains or losses included in:
Earnings	Earnings	12,664		(500)		Earnings	7,009		7,015
OCI	OCI	(178)		(683)		OCI	(173)		20
Origination of IRLCs	Origination of IRLCs	84,034		90,474		Origination of IRLCs	15,613		26,347
Purchases	Purchases	15,336		684		Purchases	—		568
Sales		(11,382)		(4,960)
Sales and repayments						Sales and repayments	(1,233)		(1,743)
Conversions to mortgage loans held for sale						Conversions to mortgage loans held for sale	(19,558)		(27,270)
Settlement of trade claims						Settlement of trade claims	(18,709)		—
Issuance of term loans						Issuance of term loans	12,486		—
Issuance of equity securities						Issuance of equity securities	7,360		—

Conversions to mortgage loans held for sale		(83,976)		(86,325)
Balance at September 30,		$	49,953	$	31,160
Balance at March 31,						Balance at March 31,	$	64,238	$	38,392

Changes in unrealized gains (losses) included in earnings related to assets still held at period end	Changes in unrealized gains (losses) included in earnings related to assets still held at period end	$	2,298	$	(7,056)	Changes in unrealized gains (losses) included in earnings related to assets still held at period end	$	(159)	$	2,390
Changes in unrealized gains (losses) included in OCI related to assets still held at period end	Changes in unrealized gains (losses) included in OCI related to assets still held at period end	$	(178)	$	(683)	Changes in unrealized gains (losses) included in OCI related to assets still held at period end	$	(173)	$	20


		January 1, 2021						September 30, 2021			January 1, 2022						March 31, 2022
		Beginning balance		Additions		Amortization		Ending balance			Beginning balance		Additions		Amortization		Ending balance
Deferred acquisition costs	Deferred acquisition costs									Deferred acquisition costs
Service and Administrative Fees:	Service and Administrative Fees:									Service and Administrative Fees:
Warranty coverage revenue		$	48,734	$	68,905	$	21,060	$	96,579
Service contract revenue										Service contract revenue	$	110,220	$	28,906	$	9,762	$	129,364
Motor club revenue	Motor club revenue	13,081		27,051		23,026		17,106		Motor club revenue	19,424		9,416		9,997		18,843
Total	Total	$	61,815	$	95,956	$	44,086	$	113,685	Total	$	129,644	$	38,322	$	19,759	$	148,207