Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Mar. 14, 2016 | Jun. 30, 2015 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2015 | ||
Document Fiscal Year Focus | 2,015 | ||
Document Fiscal Period Focus | FY | ||
Trading Symbol | FAC | ||
Entity Registrant Name | FIRST ACCEPTANCE CORP /DE/ | ||
Entity Central Index Key | 1,017,907 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Current Reporting Status | Yes | ||
Entity Voluntary Filers | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Common Stock, Shares Outstanding | 41,059,998 | ||
Entity Public Float | $ 49,812,141 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
ASSETS | ||
Investments, available-for-sale at fair value (amortized cost of $128,304 and $119,119, respectively) | $ 131,582 | $ 125,085 |
Cash and cash equivalents | 115,587 | 102,429 |
Premiums, fees, and commissions receivable, net of allowance of $454 and $392 | 69,881 | 56,486 |
Deferred tax assets, net | 18,301 | 16,521 |
Other investments | 11,256 | 10,530 |
Other assets | 6,950 | 5,962 |
Property and equipment, net | 5,141 | 3,173 |
Deferred acquisition costs | 5,509 | 3,459 |
Goodwill | 29,429 | |
Identifiable intangible assets, net | 8,491 | 4,800 |
TOTAL ASSETS | 402,127 | 328,445 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Loss and loss adjustment expense reserves | 122,071 | 96,613 |
Unearned premiums and fees | 83,426 | 67,942 |
Debentures payable | 40,256 | 40,211 |
Term loan from principal stockholder | 29,753 | |
Accrued expenses | 7,345 | 3,262 |
Other liabilities | 15,606 | 13,453 |
Total liabilities | $ 298,457 | $ 221,481 |
Stockholders’ equity: | ||
Preferred stock, $.01 par value, 10,000 shares authorized | ||
Common stock, $.01 par value, 75,000 shares authorized; 41,060 and 41,016 issued and outstanding, respectively | $ 411 | $ 410 |
Additional paid-in capital | 457,476 | 457,242 |
Accumulated other comprehensive income, net of tax of $62 and $923, respectively | 3,491 | 5,090 |
Accumulated deficit | (357,708) | (355,778) |
Total stockholders’ equity | 103,670 | 106,964 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 402,127 | $ 328,445 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Amortized cost of investments | $ 128,304 | $ 119,119 |
Allowance for premiums, fees and Commission receivable | $ 454 | $ 392 |
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares issued | 41,060,000 | 41,016,000 |
Common stock, shares outstanding | 41,060,000 | 41,016,000 |
Accumulated Other Comprehensive Income, tax | $ 62 | $ 923 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Revenues: | |||
Premiums earned | $ 266,987 | $ 218,315 | $ 199,700 |
Commission and fee income | 59,892 | 39,733 | 35,125 |
Investment income | 5,024 | 5,123 | 5,716 |
Net realized gains (losses) on investments, available-for-sale | (11) | 23 | (29) |
Total revenues | 331,892 | 263,194 | 240,512 |
Costs and expenses: | |||
Losses and loss adjustment expenses | 219,031 | 161,302 | 142,839 |
Insurance operating expenses | 105,254 | 87,328 | 82,822 |
Other operating expenses | 1,126 | 996 | 987 |
Litigation settlement | 3,677 | 187 | |
Stock-based compensation | 144 | 185 | 243 |
Depreciation | 1,751 | 1,767 | 2,053 |
Amortization of identifiable intangible assets | 514 | ||
Interest expense | 2,967 | 1,706 | 1,738 |
Total costs and expenses | 334,464 | 253,471 | 230,682 |
Income (loss) before income taxes | (2,572) | 9,723 | 9,830 |
Provision (benefit) for income taxes | (642) | (18,345) | 650 |
Net income (loss) | $ (1,930) | $ 28,068 | $ 9,180 |
Net income (loss) per share: | |||
Basic | $ (0.05) | $ 0.68 | $ 0.22 |
Diluted | $ (0.05) | $ 0.68 | $ 0.22 |
Number of shares used to calculate net income (loss) per share: | |||
Basic | 41,030 | 40,985 | 40,930 |
Diluted | 41,030 | 41,283 | 41,092 |
Reconciliation of net income (loss) to other comprehensive income (loss): | |||
Net income (loss) | $ (1,930) | $ 28,068 | $ 9,180 |
Net unrealized change in investments, net of tax of $(861), $923, and $0, respectively | (1,599) | 1,715 | (5,329) |
Comprehensive income (loss) | $ (3,529) | $ 29,783 | $ 3,851 |
CONSOLIDATED STATEMENTS OF OPE5
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Statement [Abstract] | |||
Net unrealized change in investments, tax | $ (861) | $ 923 | $ 0 |
CONSOLIDATED STATEMENTS OF STOC
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit |
Beginning balance at Dec. 31, 2012 | $ 72,793 | $ 410 | $ 456,705 | $ 8,704 | $ (393,026) |
Beginning balance, Shares at Dec. 31, 2012 | 40,962 | ||||
Net income (loss) | 9,180 | 9,180 | |||
Net unrealized change on investments (net of tax (benefit) of $0, $923 & $(861) for year 2013, 2014 & 2015 respectively) | (5,329) | (5,329) | |||
Forfeitures and repurchases of restricted common stock, Value | (7) | $ (1) | (6) | ||
Forfeitures and repurchases of restricted common stock, Shares | (19) | ||||
Stock-based compensation, Value | 243 | 243 | |||
Stock-based compensation, Shares | 5 | ||||
Issuance of shares under Employee Stock Purchase Plan, Value | 52 | $ 1 | 51 | ||
Issuance of shares under Employee Stock Purchase Plan, Shares | 35 | ||||
Ending balance at Dec. 31, 2013 | 76,932 | $ 410 | 456,993 | 3,375 | (383,846) |
Ending balance, Shares at Dec. 31, 2013 | 40,983 | ||||
Net income (loss) | 28,068 | 28,068 | |||
Net unrealized change on investments (net of tax (benefit) of $0, $923 & $(861) for year 2013, 2014 & 2015 respectively) | 1,715 | 1,715 | |||
Forfeitures and repurchases of restricted common stock, Value | (10) | (10) | |||
Forfeitures and repurchases of restricted common stock, Shares | (4) | ||||
Stock-based compensation, Value | 185 | 185 | |||
Stock-based compensation, Shares | 6 | ||||
Issuance of shares under Employee Stock Purchase Plan, Value | 74 | 74 | |||
Issuance of shares under Employee Stock Purchase Plan, Shares | 31 | ||||
Ending balance at Dec. 31, 2014 | $ 106,964 | $ 410 | 457,242 | 5,090 | (355,778) |
Ending balance, Shares at Dec. 31, 2014 | 41,016 | 41,016 | |||
Net income (loss) | $ (1,930) | (1,930) | |||
Net unrealized change on investments (net of tax (benefit) of $0, $923 & $(861) for year 2013, 2014 & 2015 respectively) | (1,599) | (1,599) | |||
Stock-based compensation, Value | 144 | 144 | |||
Stock-based compensation, Shares | 7 | ||||
Issuance of shares under Employee Stock Purchase Plan, Value | 91 | $ 1 | 90 | ||
Issuance of shares under Employee Stock Purchase Plan, Shares | 37 | ||||
Ending balance at Dec. 31, 2015 | $ 103,670 | $ 411 | $ 457,476 | $ 3,491 | $ (357,708) |
Ending balance, Shares at Dec. 31, 2015 | 41,060 | 41,060 |
CONSOLIDATED STATEMENTS OF STO7
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net unrealized change in investments, tax | $ (861) | $ 923 | $ 0 |
Accumulated Other Comprehensive Income (Loss) | |||
Net unrealized change in investments, tax | $ (861) | $ 923 | $ 0 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||
Net income (loss) | $ (1,930) | $ 28,068 | $ 9,180 |
Adjustments to reconcile net income (loss) to cash provided by operating activities: | |||
Depreciation | 1,751 | 1,767 | 2,053 |
Amortization of identifiable intangible assets | 514 | ||
Stock-based compensation | 144 | 185 | 243 |
Deferred income taxes | (917) | (19,223) | (1) |
Net realized losses (gains) on sales and redemptions of investments | 11 | (23) | 29 |
Investment income from other investments | (396) | (85) | (399) |
Other | 261 | 224 | 279 |
Change in: | |||
Premiums, fees, and commission receivable | (13,457) | (10,197) | (937) |
Loss and loss adjustment expense reserves | 25,458 | 12,327 | 5,026 |
Unearned premiums and fees | 15,484 | 11,959 | 891 |
Accrued expenses | 2,577 | 232 | 236 |
Other | (193) | 1,775 | 1,155 |
Net cash provided by operating activities | 29,307 | 27,009 | 17,755 |
Cash flows from investing activities: | |||
Purchases of investments, available-for-sale | (25,383) | (12,314) | (18,616) |
Maturities and redemptions of investments, available-for-sale | 15,988 | 19,941 | 21,769 |
Purchases of other investments | (2,190) | (3,080) | (7,139) |
Distributions from other investments | 2,088 | 195 | 25 |
Capital expenditures | (2,768) | (1,427) | (914) |
Business acquired through asset purchase | (33,770) | ||
Other | (205) | (2) | (2) |
Net cash (used in) provided by investing activities | (46,240) | 3,313 | (4,877) |
Cash flows from financing activities: | |||
Proceeds from term loan from principal stockholder | 30,000 | ||
Net proceeds from issuance of common stock | 91 | 74 | 51 |
Net cash provided by financing activities | 30,091 | 74 | 51 |
Net change in cash and cash equivalents | 13,158 | 30,396 | 12,929 |
Cash and cash equivalents, beginning of period | 102,429 | 72,033 | 59,104 |
Cash and cash equivalents, end of period | $ 115,587 | $ 102,429 | $ 72,033 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 1. Summary of Significant Accounting Policies General First Acceptance Corporation (the “Company”) is a holding company based in Nashville, Tennessee with operating subsidiaries whose primary operations include the selling, servicing, and underwriting of non-standard personal automobile insurance and related products. Our insurance operations generate revenue from selling non-standard personal automobile insurance products and related products in 17 states. We conduct our servicing and underwriting operations in 13 states and are licensed as an insurer in 12 additional states. The Company issues policies of insurance through three wholly-owned subsidiaries: First Acceptance Insurance Company, Inc., First Acceptance Insurance Company of Georgia, Inc. and First Acceptance Insurance Company of Tennessee, Inc. (collectively, the “Insurance Companies”). Basis of Consolidation and Reporting The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries which are all wholly owned. The accounts of First Acceptance Statutory Trust I (“FAST I”) are not consolidated since it does not meet the requirements for consolidation of FASB ASC 810, Consolidation ( . Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. It also requires disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported revenues and expenses during the period. Actual results could differ from those estimates. Accounting Change During the quarter ended December 31, 2015, the Company voluntarily changed the timing of its annual goodwill and identifiable intangible assets impairment testing from June 30th to October 1st of each year. The change in the goodwill and identifiable intangible assets impairment testing date is preferable under the circumstances in order to combine evaluation efforts to provide for a more consistent, efficient, and effective entity-wide impairment testing process as it better aligns the impairment testing procedures with the timing of the Company’s annual budgetary process, which is a significant input to the testing, and it allows the Company more time to accurately complete its impairment testing process in order to incorporate the results in the annual consolidated financial statements. The Company has determined that it is unable to objectively determine, without the use of hindsight, the projected cash flows and related valuation estimates for earlier periods. Therefore, the Company has prospectively applied the change in the annual goodwill and identifiable intangible assets impairment testing date beginning October 1, 2015 as retrospective application to prior periods is deemed impracticable. This change in testing date did not delay, accelerate, or avoid a goodwill or identifiable intangible assets impairment charge. No impairment was recorded in 2015. Reclassifications Certain reclassifications have been made to the prior year’s consolidated financial statements to conform with the current presentation. Investments Investments, available-for-sale at fair value, include bonds with fixed principal payment schedules and mortgage-backed securities which are amortized using the retrospective method. These securities and investments in mutual funds are carried at fair value with the corresponding unrealized appreciation or depreciation, net of deferred income taxes, reported in other comprehensive income (loss). Premiums and discounts on collateralized mortgage obligations (“CMOs”) are amortized over a period based on estimated future principal payments, including prepayments. Prepayment assumptions are reviewed periodically and adjusted to reflect actual prepayments and changes in expectations. The most significant determinants of prepayments are the difference between interest rates on the underlying mortgages and the current mortgage loan rates and the structure of the security. Other factors affecting prepayments include the size, type, and age of underlying mortgages, the geographic location of the mortgaged properties, and the credit worthiness of the borrowers. Variations from anticipated prepayments will affect the life and yield of these securities. Investment securities are exposed to various risks such as interest rate, market, and credit risk. Fair values of securities fluctuate based on changing market conditions. Significant changes in market conditions could materially affect portfolio value in the near term. Management reviews investments for impairment on a quarterly basis. Fair values of investments are based on prices quoted in the most active market for each security. If quoted prices are not available, fair value is estimated based on the fair value of comparable securities, discounted cash flow models or similar methods. Any decline in the fair value of any available-for-sale security below cost that is deemed to be other-than-temporary would result in a reduction in the amortized cost of the security. If management can assert that it does not intend to sell an impaired fixed maturity security and it is more likely than not that it will not have to sell the security before recovery of its amortized cost basis, then an entity must separate other-than-temporary impairments (“OTTI”) into the following two components: (i) the amount related to credit losses, which are charged against income, and (ii) the amount related to all other factors, which are recorded in other comprehensive income (loss). The credit-related portion of an OTTI is measured by comparing a security’s amortized cost to the present value of its current expected cash flows discounted at its effective yield prior to the impairment charge. If management intends to sell an impaired security, or it is more likely than not that it will be required to sell the security before recovery, an impairment charge is required to reduce the amortized cost of that security to fair value. Realized gains and losses on sales and redemptions of securities are computed based on specific identification. Cash and Cash Equivalents Cash and cash equivalents consist of bank demand deposits and highly-liquid investments, including overnight collateralized repurchase agreements. All investments with maturities of three months or less at the date of purchase are considered cash equivalents. Other Investments Other investments consist of limited partnership interests and an investment in the common stock of a real estate investment trust (“REIT”). Limited partnership interests are recorded at net asset value which approximates fair value. Valuations are based upon the GAAP financial statements of the partnerships which are required to be audited annually. The common stock of the REIT is recorded at a fair value with the corresponding unrealized appreciation or depreciation, net of deferred income taxes, reported in other comprehensive income (loss). The change in net asset value of limited partnership interests and any dividends paid by the REIT are recorded in investment income in the consolidated statements of comprehensive income (loss). Revenue Recognition Insurance premiums earned include policy and renewal fees and are recognized on a pro-rata basis over the respective terms of the policies. Written premiums are recorded as of the effective date of the policies for the full policy premium, although most policyholders elect to pay on a monthly installment basis. Premiums and fees are generally collected in advance of providing risk coverage, minimizing the Company’s exposure to credit risk. Premiums receivable are recorded net of an estimated allowance for uncollectible amounts. Commission and fee income includes installment fees recognized when billed, commissions and fees from ancillary products recognized on a pro-rata basis over the respective terms of the contracts, and commissions and related policy fees, written for third-party insurance companies, recognized, at the date the customer is initially billed or as of the effective date of the insurance policy, whichever is later. A liability for returned commissions is established for the amount of commission income received that the Company estimates (based on historical experience) will be returned to third-party insurance companies as a result of policy cancellations. Income Taxes Income taxes are accounted for under the liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance for the deferred taxes is established based upon management’s estimate of whether it is more likely than not that the Company would not realize tax benefits in future periods to the full extent available. Changes in the valuation allowance are recognized in income during the period in which the circumstances that cause such a change in management’s estimate occur. The Company accounts for income tax uncertainties under the provisions of FASB ASC 740, Income Taxes Property and Equipment Property and equipment are initially recorded at cost. Depreciation is provided over the estimated useful lives of the assets (generally ranging from three to five years) using the straight-line method. Leasehold improvements are amortized over the shorter of the lives of the respective leases or the service lives of the improvements. Repairs and maintenance are charged to expense as incurred. Equipment under capitalized lease obligations is stated at the present value of the minimum lease payments at the beginning of the lease term. Foreclosed Real Estate Held for Sale Foreclosed real estate held for sale is recorded at the lower of cost or fair value less estimated costs to sell. The Company periodically reviews its portfolio of foreclosed real estate held for sale using current information including (i) independent appraisals, (ii) general economic factors affecting the area where the property is located, (iii) recent sales activity and asking prices for comparable properties and (iv) costs to sell and/or develop that would serve to lower the expected proceeds from the disposal of the real estate. Gains (losses) realized on liquidation are recorded directly to operations and included in revenues. Foreclosed real estate held for sale assets of $0.8 million at December 31, 2015 and 2014 are included within other assets in the accompanying consolidated balance sheets. As of December 31, 2015, the Company was under contract to sell a portion of the portfolio. The sale is currently scheduled to close in May 2016 subject to due diligence by the buyer. Deferred Acquisition Costs Deferred acquisition costs include premium taxes and other variable underwriting and direct sales costs incurred in connection with writing successful new and renewal business. These costs are deferred and amortized over the policy period in which the related premiums are earned, to the extent that such costs are deemed recoverable from future unearned premiums and anticipated investment income. Advertising costs are expensed when incurred and are not a part of deferred acquisition costs. Amortization expense for the years ended December 31, 2015, 2014 and 2013 was $16.3 million, $11.4 million and $11.1 million, respectively, and is included within insurance operating expenses in the accompanying consolidated statements of operations and comprehensive income (loss). Goodwill and Other Identifiable Intangible Assets Goodwill and identifiable intangible assets are attributable to the Company’s insurance operations and were initially recorded at their estimated fair values at their dates of acquisition. Identifiable intangible assets with an indefinite life, (trade name and state insurance licenses) are not amortized for financial statement purposes while those with a definite life (policy renewal rights and customer relationships) are amortized in proportion to projected policy expirations. At December 31, 2015 and 2014, identifiable intangible assets were $9.0 million and $4.8 million, respectively, net of accumulated amortization expense of $0.5 million and $0.0 million, respectively. The estimated amortization expense for the five succeeding fiscal years is $1.0 million, $0.7 million, $0.5 million, $0.5 million, and $0.4 million. The Company performs required annual impairment tests of its goodwill and identifiable intangible assets as of October 1st of each year. In the event that facts and circumstances indicate that goodwill or identifiable intangible assets may be impaired, an interim impairment test would be required. The Company follows the accounting guidelines, which allows companies to waive comparing the fair value of goodwill and intangible assets to their carrying amounts in assessing the recoverability of these assets if, based on qualitative factors, it is more likely than not that the fair value of the goodwill and intangible assets is greater than their carrying amounts. Loss and Loss Adjustment Expense Reserves Loss and loss adjustment expense reserves are undiscounted and represent case-basis estimates of reported losses and estimates based on certain actuarial assumptions regarding the past experience of reported losses, including an estimate of losses incurred but not reported. Management believes that the loss and loss adjustment reserves are adequate to cover the ultimate associated liability. However, such estimates may be more or less than the amount ultimately paid when the claims are finally settled. Recent Accounting Pronouncements In February 2013, the FASB issued ASU 2013-02, Presentation of Comprehensive Income In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued a new revenue recognition standard, Accounting Standard Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers,” In May 2014, the FASB issued ASU No. 2015-09, “ Financial Services-Insurance (Topic 944): Disclosures about Short-Duration Contracts” In April 2015, the FASB issued ASU No. 2015-03, “ Interest-Imputation of Interest” In April 2015, the FASB issued ASU No. 2015-05, “ Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement” In May 2015, the FASB issued ASU No. 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” In September 2015, the FASB issued ASU No. 2015-16, “Business Combination (Topic 805): Simplifying the Accounting for Measurement-period Adjustments” Supplemental Cash Flow Information During the years ended December 31, 2015, 2014 and 2013, the Company paid $0.7 million, $0.7 million and $0.5 million, respectively, in income taxes and $1.7 million, $1.7 million and $1.7 million, respectively, in interest. Basic and Diluted Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares, while diluted net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of such common shares and dilutive share equivalents. Dilutive share equivalents result from the assumed exercise of employee stock options restricted stock units and are calculated using the treasury stock method. |
Fair Value
Fair Value | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair Value | 2. Fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are generally based upon observable and unobservable inputs. Observable inputs are based on market data from independent sources, while unobservable inputs reflect the Company’s view of market assumptions in the absence of observable market information. All assets and liabilities that are carried at fair value are classified and disclosed in one of the following categories: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Quoted market prices for similar assets or liabilities in active markets; quoted prices by independent pricing services for identical or similar assets or liabilities in markets that are not active; and valuations, using models or other valuation techniques, that use observable market data. All significant inputs are observable, or derived from observable information in the marketplace, or are supported by observable levels at which transactions are executed in the marketplace. Level 3 - Instruments that use non-binding broker quotes or model driven valuations that do not have observable market data. NAV - Calculated net asset value (“NAV”) based on an ownership interest to which a proportionate share of net assets is attributed. The Company categorizes valuation methods used in both its identifiable intangible assets initial measurement and impairment tests as Level 3. To determine the fair value of acquired trademarks and trade names, the Company uses the relief-from-royalty method, which requires the Company to estimate the future revenue for the related brands, the appropriate royalty rate and the weighted average cost of capital. To determine the fair value of the acquired policy renewal rights and customer relationships, the Company uses an “excess earnings” method that relied on projected future net cash flows and included key assumptions for the customer retention and renewal rates. The data used in these methods is not observable in the market. The Company also categorizes the valuation method used to fair value an investment in the common stock of a privately-held real estate investment trust included in other investments as Level 3, since this investment is not readily marketable. Fair Value of Financial Instruments The carrying values and fair values of certain of the Company’s financial instruments were as follows (in thousands). December 31, 2015 December 31, 2014 Carrying Fair Carrying Fair Value Value Value Value Assets: Investments, available-for-sale $ 131,582 $ 131,582 $ 125,085 $ 125,085 Other investments 11,256 11,256 10,530 10,530 Liabilities: Debentures payable 40,256 20,275 40,211 19,606 Term loan from principal stockholder 29,753 28,504 — — The fair values as presented represent the Company’s best estimates and may not be substantiated by comparisons to independent markets. The fair value of the debentures payable and the term loan from principal shareholder are categorized as Level 3, since they were based on current market rates offered for debt with similar risks and maturities, an unobservable input categorized as Level 3. Carrying values of certain financial instruments, such as cash and cash equivalents and premiums and fees receivable, approximate fair value due to the short-term nature of the instruments and are not required to be disclosed. Therefore, the aggregate of the fair values presented in the preceding table do not purport to represent the Company’s underlying value. The Company holds available-for-sale investments and other investments, which are carried at net asset value which approximates fair value. The following tables present the fair-value measurements for each major category of assets that are measured on a recurring basis (in thousands). Fair Value Measurements Using Quoted Prices Significant in Active Other Significant Proportionate Markets for Observable Unobservable Share of Identical Assets Inputs Inputs Net Assets December 31, 2015 Total (Level 1) (Level 2) (Level 3) (NAV) Fixed maturities, available-for-sale: U.S. government and agencies $ 13,113 $ 13,113 $ — $ — $ — State 702 — 702 — — Political subdivisions 4,363 — 4,363 — — Revenue and assessment 12,644 — 12,644 — — Corporate bonds 80,785 — 80,785 — — Collateralized mortgage obligations: Agency backed 873 — 873 — — Non-agency backed – residential 3,455 — 3,455 — — Non-agency backed – commercial 2,507 — 2,507 — — Total fixed maturities, available-for-sale 118,442 13,113 105,329 — — Preferred stock, available-for-sale 1,723 1,723 — — — Mutual funds, available-for-sale 11,417 11,417 — — — Total investments, available-for-sale 131,582 26,253 105,329 — — Other investments 11,256 — — 3,276 7,980 Cash and cash equivalents 115,587 115,587 — — — Total $ 258,425 $ 141,840 $ 105,329 $ 3,276 $ 7,980 Fair Value Measurements Using Quoted Prices Significant in Active Other Significant Proportionate Markets for Observable Unobservable Share of Identical Assets Inputs Inputs Net Assets December 31, 2014 Total (Level 1) (Level 2) (Level 3) (NAV) Fixed maturities, available-for-sale: U.S. government and agencies $ 8,290 $ 8,290 $ — $ — $ — State 725 — 725 — — Political subdivisions 506 — 506 — — Revenue and assessment 16,360 — 16,360 — — Corporate bonds 75,119 — 75,119 — — Collateralized mortgage obligations: Agency backed 4,807 — 4,807 — — Non-agency backed – residential 4,137 — 4,137 — — Non-agency backed – commercial 3,078 — 3,078 — — Total fixed maturities, available-for-sale 113,022 8,290 104,732 — — Preferred stock, available-for-sale 1,767 1,767 — — — Mutual funds, available-for-sale 10,296 10,296 — — — Total investments, available-for-sale 125,085 20,353 104,732 — — Other investment 10,530 — — 947 9,583 Cash and cash equivalents 102,429 102,429 — — — Total $ 238,044 $ 122,782 $ 104,732 $ 947 $ 9,583 The fair values of the Company’s investments are determined by management after taking into consideration available sources of data. All of the portfolio valuations classified as Level 1 or Level 2 in the above tables are priced exclusively by utilizing the services of independent pricing sources using observable market data. The Level 2 classified security valuations are obtained from a single independent pricing service. The Level 3 classified security in the table above consists of an investment in the common stock of a real estate investment trust for which fair value has been determined using a model driven valuation that does not have observable market data. There were no transfers between Level 1 and Level 2 for years ended December 31, 2015 and 2014. The Company’s policy is to recognize transfers between levels at the end of the reporting period based on specific identification. The Company has not made any adjustments to the prices obtained from the independent pricing sources. The Company has reviewed the pricing techniques and methodologies of the independent pricing service for Level 2 investments and believes that its policies adequately consider market activity, either based on specific transactions for the security valued or based on modeling of securities with similar credit quality, duration, yield and structure that were recently traded. The Company monitored security-specific valuation trends and has made inquiries with the pricing service about material changes or the absence of expected changes to understand the underlying factors and inputs and to validate the reasonableness of the pricing. Likewise, the Company reviews the Level 3 valuation model to understand the underlying factors and inputs and to validate the reasonableness of the pricing. The following table represents the quantitative disclosure for those assets classified as Level 3 during the year ended December 31, 2015 (in thousands). Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Common Stock at Fair Value Balance at December 31, 2014 $ 947 Gains included in net income (loss) — Gains included in comprehensive income (loss) 229 Investments and capital calls 2,100 Distributions received — Transfers into and out of Level 3 — Balance at December 31, 2015 $ 3,276 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2015 | |
Investments Debt And Equity Securities [Abstract] | |
Investments | 3. Investments Investments, Available-for-Sale The following tables summarize the Company’s investment securities (in thousands). Gross Gross Amortized Unrealized Unrealized Fair December 31, 2015 Cost Gains Losses Value U.S. government and agencies $ 13,036 $ 162 $ (85 ) $ 13,113 State 698 4 — 702 Political subdivisions 4,354 9 — 4,363 Revenue and assessment 11,770 895 (21 ) 12,644 Corporate bonds 79,426 2,022 (663 ) 80,785 Collateralized mortgage obligations: Agency backed 793 80 — 873 Non-agency backed – residential 2,877 579 (1 ) 3,455 Non-agency backed – commercial 1,891 616 — 2,507 Total fixed maturities, available-for-sale 114,845 4,367 (770 ) 118,442 Preferred stock, available-for-sale 1,500 223 — 1,723 Mutual funds, available-for-sale 11,959 120 (662 ) 11,417 $ 128,304 $ 4,710 $ (1,432 ) $ 131,582 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2014 Cost Gains Losses Value U.S. government and agencies $ 8,039 $ 277 $ (26 ) $ 8,290 State 698 27 — 725 Political subdivisions 500 6 — 506 Revenue and assessment 14,856 1,522 (18 ) 16,360 Corporate bonds 73,051 2,698 (630 ) 75,119 Collateralized mortgage obligations: Agency backed 4,647 160 — 4,807 Non-agency backed – residential 3,513 624 — 4,137 Non-agency backed – commercial 2,414 664 — 3,078 Total fixed maturities, available-for-sale 107,718 5,978 (674 ) 113,022 Preferred stock, available-for-sale 1,500 267 — 1,767 Mutual funds, available-for-sale 9,901 403 (8 ) 10,296 $ 119,119 $ 6,648 $ (682 ) $ 125,085 The following table sets forth the scheduled maturities of the Company’s fixed maturity securities based on their fair values (in thousands). Actual maturities may differ from contractual maturities because certain securities may be called or prepaid by the issuers. Securities Securities Securities with No All with with Unrealized Fixed Unrealized Unrealized Gains or Maturity December 31, 2015 Gains Losses Losses Securities One year or less $ 3,715 $ 1,036 $ 1,550 $ 6,301 After one through five years 17,383 15,650 — 33,033 After five through ten years 31,952 31,854 — 63,806 After ten years 8,467 — — 8,467 No single maturity date 6,641 194 — 6,835 $ 68,158 $ 48,734 $ 1,550 $ 118,442 The fair value and gross unrealized losses of investments, available-for-sale, by the length of time that individual securities have been in a continuous unrealized loss position follows (in thousands). Less than 12 months 12 months or longer December 31, 2015 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Total Gross Losses U.S. government and agencies $ 8,946 $ (85 ) $ — $ — $ (85 ) State — — — — — Political subdivisions — — — — — Revenue and assessment 1,733 (21 ) — — (21 ) Corporate bonds 30,172 (422 ) 7,689 (241 ) (663 ) Collateralized mortgage obligations: Agency backed — — — — — Non-agency backed – residential 5 (1 ) — — (1 ) Non-agency backed – commercial 189 — — — — Total fixed maturities, available-for-sale 41,045 (529 ) 7,689 (241 ) (770 ) Preferred stock, available-for-sale — — — — — Mutual funds, available-for-sale 8,839 (662 ) — — (662 ) $ 49,884 $ (1,191 ) $ 7,689 $ (241 ) $ (1,432 ) Less than 12 months 12 months or longer December 31, 2014 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Total Gross Losses U.S. government and agencies $ 5,012 $ (26 ) $ — $ — $ (26 ) State — — — — — Political subdivisions — — — — — Revenue and assessment 2,820 (18 ) — — (18 ) Corporate bonds 7,681 (38 ) 20,567 (592 ) (630 ) Collateralized mortgage obligations: Agency backed — — — — — Non-agency backed – residential — — — — — Non-agency backed – commercial — — — — — Total fixed maturities, available-for-sale 15,513 (82 ) 20,567 (592 ) (674 ) Preferred stock, available-for-sale — — — — — Mutual funds, available-for-sale 1,992 (8 ) — — (8 ) $ 17,505 $ (90 ) $ 20,567 $ (592 ) $ (682 ) The following table reflects the number of fixed maturity securities with gross unrealized gains and losses. Gross unrealized losses are further segregated by the length of time that individual securities have been in a continuous unrealized loss position. Gross Unrealized Losses Less than Greater Gross or equal to than 12 Unrealized At: 12 months months Gains December 31, 2015 21 4 70 December 31, 2014 9 9 80 The following tables reflect the fair value and gross unrealized losses of those fixed maturity securities in a continuous unrealized loss position for greater than 12 months. Gross unrealized losses are further segregated by the percentage of amortized cost (in thousands, except number of securities). Number Gross Gross Unrealized Losses of Fair Unrealized at December 31, 2015: Securities Value Losses Less than or equal to 10% 4 $ 7,689 (241 ) Greater than 10% — — — 4 $ 7,689 $ (241 ) Number Gross Gross Unrealized Losses of Fair Unrealized at December 31, 2014: Securities Value Losses Less than or equal to 10% 9 $ 20,567 $ (592 ) Greater than 10% — — — 9 $ 20,567 $ (592 ) The following tables set forth the amount of gross unrealized losses by current severity (as compared to amortized cost) and length of time that individual securities have been in a continuous unrealized loss position (in thousands). Fair Value of Securities with Length of Gross Gross Severity of Gross Unrealized Losses Gross Unrealized Losses Unrealized Unrealized Less 5% to Greater at December 31, 2015: Losses Losses than 5% 10% than 10% Less than or equal to: Three months $ 20,899 $ (130 ) $ (130 ) $ — $ — Six months 7,036 (465 ) — (465 ) — Nine months 14,057 (395 ) (197 ) (197 ) (1 ) Twelve months 7,892 (201 ) (201 ) — — Greater than twelve months 7,689 (241 ) (241 ) — — Total $ 57,573 $ (1,432 ) $ (769 ) $ (662 ) $ (1 ) Fair Value of Securities with Length of Gross Gross Severity of Gross Unrealized Losses Gross Unrealized Losses Unrealized Unrealized Less 5% to Greater at December 31, 2014: Losses Losses than 5% 10% than 10% Less than or equal to: Three months $ 17,505 $ (90 ) $ (90 ) $ — $ — Six months — — — — — Nine months — — — — — Twelve months — — — — — Greater than twelve months 20,567 (592 ) (592 ) — — Total $ 38,072 $ (682 ) $ (682 ) $ — $ — Other Investments Other investments consist of the common stock of a real estate investment trust and limited partnership interests in three funds that invest in (i) commercial real estate and secured commercial real estate loans acquired from financial intuitions, (ii) small balance distressed secured loans and debt securities and (iii) undervalued international publicly-traded equities. These investments have redemption and transfer restrictions. In 2015, the Company started the withdrawal process for one of the limited partnership investments which is taking place over a twelve-month period in 25% increments, one of which was received prior to December 31, 2015. The Company does not intend to sell the remaining investments, and it is more likely than not that the Company will not be required to sell them before the expiration of such restrictions. At December 31, 2015, the Company had unfunded commitments of $1.1 million with two of these investments. Restrictions At December 31, 2015, fixed maturities and cash equivalents with a fair value and amortized cost of $6.5 million were on deposit with various insurance departments as a requirement of doing business in those states. Cash equivalents with a fair value and amortized cost of $9.4 million were on deposit with another insurance company as collateral for an assumed reinsurance contract. Investment Income and Net Realized Gains and Losses The major categories of investment income follow (in thousands). Year Ended December 31, 2015 2014 2013 Fixed maturities, available-for-sale $ 4,220 $ 4,481 $ 4,914 Mutual funds, available-for-sale 666 832 766 Other investments 396 85 399 Other 236 214 213 Investment expenses (494 ) (489 ) (576 ) $ 5,024 $ 5,123 $ 5,716 The components of net realized gains (losses) on investments, available-for-sale follow (in thousands). Year Ended December 31, 2015 2014 2013 Gains $ 15 $ 85 $ 100 Losses (26 ) (62 ) (68 ) Other than temporary impairment — — (61 ) $ (11 ) $ 23 $ (29 ) Realized gains and losses on sales and redemptions are computed based on specific identification. The non-credit related portion of OTTI is included in other comprehensive income (loss). The amounts of non-credit OTTI for securities still owned was $0.9 million for non-agency backed residential CMOs and $0.2 million for non-agency backed commercial at December 31, 2015 and 2014. Other-Than-Temporary Impairment The Company separates OTTI into the following two components: (i) the amount related to credit losses, which is recognized in the consolidated statement of operations and comprehensive income (loss) and (ii) the amount related to all other factors, which is recorded in other comprehensive income (loss). The credit-related portion of an OTTI is measured by comparing a security’s amortized cost to the present value of its current expected cash flows discounted at its effective yield prior to the impairment charge. The determination of whether unrealized losses are “other-than-temporary” requires judgment based on subjective as well as objective factors. The Company routinely monitors its investment portfolio for changes in fair value that might indicate potential impairments and performs detailed reviews on such securities. Changes in fair value are evaluated to determine the extent to which such changes are attributable to (i) fundamental factors specific to the issuer or (ii) market-related factors such as interest rates or sector declines. Securities with declines attributable to issuer-specific fundamentals are reviewed to identify all available evidence to estimate the potential for impairment. Resources used include historical financial data included in filings with the United States Securities and Exchange Commission (“SEC”) for corporate bonds and performance data regarding the underlying loans for CMOs. Securities with declines attributable solely to market or sector declines where the Company does not intend to sell the security and it is more likely than not that the Company will not be required to sell the security before the full recovery of its amortized cost basis are not deemed to be other-than-temporarily impaired. The issuer-specific factors considered in reaching the conclusion that securities with declines are not other-than-temporary include (i) the extent and duration of the decline in fair value, including the duration of any significant decline in value, (ii) whether the security is current as to payments of principal and interest, (iii) a valuation of any underlying collateral, (iv) current and future conditions and trends for both the business and its industry, (v) changes in cash flow assumptions for CMOs and (vi) rating agency actions. Based on these factors, the Company makes a determination as to the probability of recovering principal and interest on the security. The Company had recognized OTTI charges in net income for one collateralized mortgage obligation security totaling a loss of $61 thousand for the year ended December 31, 2013. The Company has not recognized OTTI charges in net income (loss) for the years ending December 31, 2015 and 2014. The following is a progression of the credit-related portion of OTTI on investments owned at December 31, 2015, 2014, and 2013 (in thousands). Year Ended December 31, 2015 2014 2013 Beginning balance $ (2,632 ) $ (2,632 ) $ (2,666 ) Additional credit impairments on: Previously impaired securities — — (61 ) Securities without previous impairments — — — — — (61 ) Reductions for securities deemed worthless (realized) — — 95 $ (2,632 ) $ (2,632 ) $ (2,632 ) |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 31, 2015 | |
Insurance [Abstract] | |
Reinsurance | 4. Reinsurance Total premiums written and earned are summarized as follows (in thousands). Year Ended December 31, 2015 2014 2013 Written Earned Written Earned Written Earned Direct $ 247,498 $ 233,652 $ 200,983 $ 191,093 $ 177,376 $ 176,588 Assumed 35,500 33,707 29,311 27,487 23,768 23,313 Ceded (372 ) (372 ) (265 ) (265 ) (201 ) (201 ) Total $ 282,626 $ 266,987 $ 230,029 $ 218,315 $ 200,943 $ 199,700 Assumed business represents private-passenger non-standard automobile insurance premiums in Texas written through a program with a county mutual insurance company and assumed by the Company through 100% quota-share reinsurance. The percentages of premiums assumed to net premiums written for the years ended December 31, 2015, 2014 and 2013 were 13%, 13% and 12%, respectively. The Insurance Companies utilize excess-of-loss reinsurance with an unaffiliated reinsurer to limit their exposure to losses under liability coverages for policies issued with limits greater than the minimum statutory requirements. In November 2013, this excess-of-loss reinsurance was expanded to include higher liability limits on tenant homeowner policies. Although the reinsurance agreements contractually obligate the reinsurer to reimburse the Company for their share of losses, they do not discharge the primary liability of the Company, which remains contingently liable in the event the reinsurer is unable to meet their contractual obligations. At December 31, 2015, the Insurance Companies had unsecured aggregate reinsurance receivables of $0.5 million. Ceded premiums earned and reinsurance recoveries on losses and loss adjustment expenses were as follows (in thousands): Year Ended December 31, 2015 2014 2013 Ceded premiums earned $ 372 $ 265 $ 201 Reinsurance recoveries on losses and loss adjustment expenses $ 239 $ 137 $ 285 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Stock-Based Compensation Plans | 5. Stock-Based Compensation Plans Employee Stock-Based Incentive Plan The Company has issued stock options (“Stock Option Awards”) and restricted common stock and restricted stock units (“Restricted Stock Awards”) to employees and directors under its Amended and Restated First Acceptance Corporation 2002 Long Term Incentive Plan (the “Plan”) and accounts for such issuances in accordance with FASB ASC 718, Compensation – Stock Compensation On January 31, 2012, the Compensation Committee of the Board of Directors of the Company awarded two executive officers Stock Option Awards to purchase 750,000 and 75,000 shares of the Company’s common stock at an exercise price of $1.45 per share and vest 40% and 20%, respectively, upon grant with the remainder vesting in equal installments over three and four years, respectively. Additionally, these Stock Option Awards expire on January 31, 2017. Compensation expense related to these Stock Option Awards was $522 thousand, of which $521 thousand was amortized through December 2015 and the remaining $1 thousand will be amortized in January 2016. The fair value of these Stock Option Awards was estimated at the grant date using the Black-Scholes option pricing model with an expected volatility of 73%, a risk-free interest rate of 0.71%, a dividend yield rate of zero, and a five-year expected term. Based on the calculation using the Black-Scholes option pricing model, the grant date fair value of options granted was $0.63 per share. Expected volatility is based on the historical volatility in the price of the Company’s common stock since April 2004. The risk-free interest rate is the five-year Treasury rate, based on the term of the options. The dividend yield assumption is based on our history and expectation of dividend payments on common stock. The expected term represents the period of time that these Stock Option Awards are expected to remain outstanding. Compensation expense related to Stock Option Awards is calculated under the fair value method and is recorded on a straight-line basis over the vesting period. There were no Stock Option Awards granted during the years ended December 31, 2015 and 2014. At December 31, 2015, the weighted average remaining contractual life of options outstanding and exercisable/vested was approximately 1.4 years for both. On March 10, 2015, the Compensation Committee of the Board of Directors of the Company awarded 141 thousand restricted stock units to executive officers. Such restricted stock units will vest, and an equal number of shares of common stock will be deliverable upon the third anniversary of the date of grant. Compensation expense related to the units was calculated based upon the closing market price of the common stock on the date of grant ($2.44) and is recorded on a straight-line basis over the vesting period. A summary of the activity for the Company’s Stock Option Awards is presented below (in thousands, except per share data). Options Exercise Price Weighted Average Exercise Price Aggregated Intrinsic Value Options outstanding at December 31, 2012 1,595 $1.45-$8.13 $ 2.38 Forfeited (358 ) $3.04 $ 3.04 Options outstanding at December 31, 2013 1,237 $1.45-$8.13 $ 2.19 Forfeited (117 ) $5.22 $ 5.22 Options outstanding at December 31, 2014 1,120 $1.45-$3.04 $ 1.87 Forfeited (35 ) $3.04 $ 3.04 Options outstanding at December 31, 2015 1,085 $1.45-$3.04 $ 1.83 $ 767 Options exercisable/vested at December 31, 2015 1,070 $ 1.84 $ 753 Employee Stock Purchase Plan The Company’s Board of Directors adopted the First Acceptance Corporation Employee Stock Purchase Plan (“ESPP”) whereby eligible employees may purchase shares of the Company’s common stock at a price equal to the lower of the closing market price on the first or last trading day of a six-month period. ESPP participants can authorize payroll deductions, administered through an independent plan custodian, of up to 15% of their salary to purchase semi-annually (June 30 and December 31) up to $25,000 of the Company’s common stock during each calendar year. The Company has reserved 400,000 shares of common stock for issuance under the ESPP. Employees purchased approximately 37,000, 31,000, and 35,000 shares during the years ended December 31, 2015, 2014 and 2013, respectively. Compensation expense attributable to subscriptions to purchase shares under the ESPP was $12 thousand, $11 thousand and $7 thousand for the years ended December 31, 2015, 2014 and 2013, respectively. At December 31, 2015, 50,565 shares remain available for issuance under the ESPP. |
Employee Benefit Plan
Employee Benefit Plan | 12 Months Ended |
Dec. 31, 2015 | |
Compensation And Retirement Disclosure [Abstract] | |
Employee Benefit Plan | 6. Employee Benefit Plan The Company sponsors a defined contribution retirement plan (“401k Plan”) under Section 401(k) of the Internal Revenue Code. The 401k Plan covers substantially all employees who meet specified service requirements. Under the 401k Plan, the Company may, at its discretion, match 100% of the first 3% of an employee’s salary plus 50% of the next 2% up to the maximum allowed by the Internal Revenue Code. The Company’s contributions to the 401k Plan for the years ended December 31, 2015, 2014 and 2013 were $1.0 million, $0.7 million and $0.6 million, respectively, and are included within insurance operating expenses in the accompanying consolidated statements of operations and comprehensive income (loss). |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |
Property and Equipment | 7. Property and Equipment The components of property and equipment are as follows (in thousands). Year Ended December 31, 2015 2014 Furniture and equipment $ 12,878 $ 10,660 Leasehold improvements 6,451 5,000 Capitalized leases 238 238 Aircraft 190 190 19,757 16,088 Less: Accumulated depreciation (14,616 ) (12,915 ) Property and equipment, net $ 5,141 $ 3,173 Depreciation expense related to property and equipment was $1.8 million, $1.8 million and $2.1 million for the years ended December 31, 2015, 2014 and 2013, respectively. Included within the furniture and equipment and the leasehold improvements categories at December 31, 2015 above are capitalized assets totaling $0.2 million not yet in service. These assets are related to the Company’s strategic investments in its retail stores and relocation of its Chicago call center. |
Lease Commitments
Lease Commitments | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Lease Commitments | 8. Lease Commitments The Company is committed under various operating lease agreements for office space. Certain lease agreements contain renewal options and rent escalation clauses. Rental expense for the years ended December 31, 2015, 2014 and 2013 was $11.2 million, $8.9 million and $9.2 million, respectively, and is included within insurance operating expenses in the accompanying consolidated statements of operations and comprehensive income (loss). Future minimum lease payments under these agreements follow (in thousands). For the Year Ended December 31, Amount 2016 $ 7,079 2017 3,991 2018 2,027 2019 924 2020 631 Thereafter 1,483 Total $ 16,135 |
Losses and Loss Adjustment Expe
Losses and Loss Adjustment Expenses Incurred and Paid | 12 Months Ended |
Dec. 31, 2015 | |
Insurance [Abstract] | |
Losses and Loss Adjustment Expenses Incurred and Paid | 9. Losses and Loss Adjustment Expenses Incurred and Paid Information regarding the reserve for unpaid losses and loss adjustment expenses (“LAE”) is as follows (in thousands). Year Ended December 31, 2015 2014 2013 Liability for unpaid losses and LAE at beginning of year, gross $ 96,613 $ 84,286 $ 79,260 Reinsurance balances receivable (362 ) (305 ) (260 ) Liability for unpaid losses and LAE at beginning of year, net 96,251 83,981 79,000 Add: Provision for lossses and LAE: Current year 218,186 166,185 145,877 Prior year 845 (4,883 ) (3,038 ) Net losses and LAE incurred 219,031 161,302 142,839 Less: Losses and LAE paid: Current year 129,216 98,442 88,726 Prior year 64,459 50,590 49,132 Net losses and LAE paid 193,675 149,032 137,858 Liability for unpaid losses and LAE at end of year, net 121,607 96,251 83,981 Reinsurance balances receivable 464 362 305 Liability for unpaid losses and LAE at end of year, gross $ 122,071 $ 96,613 $ 84,286 The unfavorable change in the estimate of unpaid losses and loss adjustment expenses of $0.8 million for the year ended December 31, 2015 was largely the result of an increase in bodily injury loss adjustment expenses (primarily outside legal costs) driven by the overall increase in claim frequency. The favorable change in the estimate of unpaid losses and loss adjustment expenses of $4.8 million for the year ended December 31, 2014 was primarily related to bodily injury claims occurring in accident years 2010 through 2013. The favorable change in the estimate of unpaid losses and loss adjustment expenses of $3.0 million for the year ended December 31, 2013 was primarily related to bodily injury claims occurring in accent years 2010 to 2012, partially offset by unfavorable loss and loss adjustment expense development on Florida personal injury protection claims. |
Debentures Payable and Term Loa
Debentures Payable and Term Loan From Principal Stockholder | 12 Months Ended |
Dec. 31, 2015 | |
Debt Disclosure [Abstract] | |
Debentures Payable and Term Loan From Principal Stockholder | 10. Debentures Payable and Term Loan From Principal Stockholder In June 2007, First Acceptance Statutory Trust I (“FAST I”), a wholly-owned unconsolidated subsidiary trust of the Company, issued 40,000 shares of preferred securities at $1,000 per share to outside investors and 1,240 shares of common securities to the Company, also at $1,000 per share. FAST I used the proceeds from the sale of the preferred securities to purchase $41.2 million of junior subordinated debentures from the Company. The sole assets of FAST I are $41.2 million of junior subordinated debentures issued by the Company. The debentures will mature on July 30, 2037 and are currently redeemable by the Company in whole or in part and the preferred securities are callable. The debentures paid a fixed rate of 9.277% until July 30, 2012, after which the rate became variable (Three-Month LIBOR plus 375 basis points, resetting quarterly). The interest rate related to the debentures ranged from 3.983% to 4.072% during 2015. In January 2016, the interest rate reset to 4.366% through April 2016. The obligations of the Company under the junior subordinated debentures represent full and unconditional guarantees by the Company of FAST I’s obligations for the preferred securities. Dividends on the preferred securities are cumulative, payable quarterly in arrears and are deferrable at the Company’s option for up to five years. The dividends on these securities, which have not been deferred, are the same as the interest on the debentures. The Company cannot pay dividends on its common stock during such deferments. The debentures are classified as debentures payable in the Company’s consolidated balance sheets and the interest paid on these debentures is classified as interest expense in the consolidated statements of operations and comprehensive income (loss). At December 31, 2015, the unamortized debt discount and issuance costs of $1.0 million are being amortized to interest expense over the term of the debentures. On June 29, 2015, to finance the acquisition of the Titan Agencies, the Company borrowed the full amount under a $30 million Loan Agreement (the “Loan Agreement”) with Diamond Family Investments, LP, an affiliate of Gerald J. Ford, the Company’s controlling stockholder. The Loan Agreement provided a $30 million interest-only senior term loan facility, maturing in full on June 29, 2025. Commencing June 29, 2016, the Company has the right to prepay the loan in whole or in part, in cash, without premium or penalty, upon written notice to the lender. Amounts prepaid under the Loan Agreement may not be reborrowed. The term loan outstanding under the Loan Agreement bears interest at a rate of 8% per annum. The Loan Agreement contains certain representations, warranties and covenants. The Loan Agreement also contains customary events of default, including but not limited to: nonpayment; material inaccuracy of representations and warranties; violations of covenants; cross-default to material indebtedness; certain material judgments; certain bankruptcies and liquidations; invalidity of the loan documents and related events; and a change of control (as defined in the Loan Agreement). At December 31, 2015 the unamortized loan issuance costs of $0.2 million is being amortized to interest expense over the term of the loan. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | 11. Income Taxes The provision (benefit) for income taxes consisted of the following (in thousands). Year Ended December 31, 2015 2014 2013 Federal: Current $ 20 $ 228 $ 175 Deferred (893 ) (19,098 ) (4 ) (873 ) (18,870 ) 171 State: Current 255 650 476 Deferred (24 ) (125 ) 3 231 525 479 $ (642 ) $ (18,345 ) $ 650 The provision (benefit) for income taxes differs from the amounts computed by applying the statutory federal corporate tax rate of 35% to income (loss) before income taxes as a result of the following (in thousands). Year Ended December 31, 2015 2014 2013 Provision (benefit) for income taxes at statutory rate $ (900 ) $ 3,403 $ 3,440 Tax effect of: Tax-exempt investment income (22 ) (21 ) (27 ) Change in the beginning of the period balance of the valuation allowance for deferred tax assets allocated to federal income taxes 9 (22,427 ) (4,277 ) Stock-based compensation 22 137 1,133 State income taxes, net of federal income tax benefit and state valuation allowance 142 525 479 Permanent items 107 38 (98 ) $ (642 ) $ (18,345 ) $ 650 The tax effects of temporary differences that give rise to the net deferred tax assets and liabilities are presented below (in thousands). Year Ended December 31, 2015 2014 Deferred tax assets: Net operating loss carryforwards $ 6,859 $ 6,180 Stock-based compensation 421 402 Unearned premiums and loss and loss adjustment expense reserves 6,797 5,614 Goodwill and identifiable intangible assets 4,252 5,404 Alternative minimum tax (“AMT”) credit carryforwards 2,015 2,004 Accrued expenses and other nondeductible items 1,551 1,201 Other 3,528 3,127 25,423 23,932 Deferred tax liabilities: Deferred acquisition costs (1,928 ) (1,211 ) Identifiable intangible assets (1,872 ) (1,872 ) Net unrealized change on investments (1,244 ) (2,105 ) Other (332 ) (460 ) (5,376 ) (5,648 ) Total net deferred tax asset 20,047 18,284 Less: Valuation allowance (1,746 ) (1,763 ) Net deferred tax asset $ 18,301 $ 16,521 The Company had a valuation allowance of approximately $1.8 million at both December 31, 2015 and 2014, relating to certain amounts that are more likely than not to be realized. The change in the valuation allowance for the year ended December 31, 2015 was not material. Prior to December 31, 2014, the Company had a full valuation allowance against its deferred tax asset based upon past negative evidence in the form of historical taxable losses. Based upon positive evidence from recent taxable income and the Company’s outlook for future profitability, the deferred tax valuation allowance for the year ended December 31, 2014 was decreased by $22.4 million to include only the amounts referred to above. For the year ended December 31, 2014, the change in the valuation allowance included a decrease of $1.2 million related to the unrealized change on investments included in other comprehensive income (loss) and was net of the utilization of $9.8 million in NOL carryforwards. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the net deferred tax asset will not be realized. The Company is required to assess whether a valuation allowance should be established against the Company’s net deferred tax asset based on the consideration of all available evidence using a more likely than not standard. In making such judgments, significant weight is given to evidence that can be objectively verified. In assessing the Company’s ability to support the realizability of its net deferred tax asset, management considers both positive and negative evidence. In establishing a full deferred tax valuation allowance from June 30, 2009 through September 30, 2014, the Company placed greater weight on historical results than on the Company’s outlook for future profitability. Negative evidence, including a twelve quarter cumulative taxable loss, resulted in the establishment of a full valuation allowance. As of December 31, 2014, the Company’s historical results reflected a twelve quarter cumulative taxable income which management considered to be a trend of positive evidence in assessing the realizability of its net deferred tax asset. Based on this fact and the Company’s outlook for future profitability, the deferred tax asset valuation allowance was adjusted as of December 31, 2014 and resulted in the aforementioned change in the valuation allowance. The change in the total valuation allowance for the year ended December 31, 2013 was a decrease of $4.3 million. For the year ended December 31, 2013, the change in the valuation allowance included decreases of $1.9 million related to the unrealized change on investments included in other comprehensive income (loss) and was net of the utilization of $8.6 million in NOL carryforwards. At December 31, 2015, the Company had gross federal NOL carryforwards of $19.6 million that begin to expire in 2031. In addition, the Company had AMT credit carryforwards of $2.0 million that have no expiration date. At December 31, 2015, the Company had gross state NOL carryforwards of $8.5 million that begin to expire in 2020. |
Net Income (Loss) Per Share
Net Income (Loss) Per Share | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Share | 12. Net Income (Loss) Per Share Basic EPS are computed using the weighted average number of shares outstanding. Diluted EPS are computed using the weighted average number of shares outstanding adjusted for the incremental shares attributed to outstanding securities with a right to purchase or convert into common stock. The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share data). Year Ended December 31, 2015 2014 2013 Net income (loss) $ (1,930 ) $ 28,068 $ 9,180 Weighted average common basic shares 41,030 40,985 40,930 Effect of dilutive securities — 298 162 Weighted average common dilutive shares 41,030 41,283 41,092 Basic and diluted net income (loss) per share $ (0.05 ) $ 0.68 $ 0.22 For the year ended December 31, 2015, the computation of diluted net income per share did not include options to purchase approximately 825 thousand shares, a dilutive effect of 319 thousand shares, and restricted stock units convertible into 141 thousand shares, a dilutive effect of 26 thousand shares, since their inclusion would have been anti-dilutive. Options to purchase 260 thousand shares for the year ended December 31, 2015 were not included in the computation of diluted net income (loss) per share as their exercise prices were in excess of the average stock prices for the year. For the year ended December 31, 2014 the computation of diluted net income per share included exercisable options to purchase approximately 0.8 million shares that had a dilutive effect of 298 thousand shares. Options to purchase 295 thousand shares for the year ended December 31, 2014 were not included in the computation of diluted net income (loss) per share as their exercise prices were in excess of the average stock prices for the year. For the year ended December 31, 2013, the computation of diluted net income per share included 17 thousand shares of unvested restricted common stock and exercisable options to purchase approximately 0.9 million shares that had a dilutive effect of 145 thousand shares. Options to purchase 412 thousand shares for the year ended December 31, 2013 were not included in the computation of diluted net income (loss) per share as their exercise prices were in excess of the average stock prices for the year. |
Concentrations of Credit Risk
Concentrations of Credit Risk | 12 Months Ended |
Dec. 31, 2015 | |
Risks And Uncertainties [Abstract] | |
Concentrations of Credit Risk | 13. Concentrations of Credit Risk At December 31, 2015, the Company had certain concentrations of credit risk with several financial institutions in the form of cash and cash equivalents, which amounted to $115.6 million. For purposes of evaluating credit risk, the stability of financial institutions conducting business with the Company, the amount of collateral posted and the amount of available Federal Deposit Insurance Corporation insurance is periodically reviewed. If the financial institutions failed to completely perform under terms of the financial instruments, the exposure for credit loss would be the amount of the financial instruments less amounts covered by regulatory insurance. The Company primarily transacts business either directly with its policyholders or through independently-owned insurance agencies who write non-standard personal automobile insurance policies on behalf of the Company. Direct policyholders make payments directly to the Company. Balances due from policyholders are generally secured by the related unearned premium. The Company requires a down payment at the time the policy is originated and subsequent scheduled payments are monitored in order to prevent the Company from providing coverage beyond the date for which payment has been received. If subsequent payments are not made timely, the policy is generally canceled at no loss to the Company. Policyholders whose premiums are written through the independent agencies make their payments to these agencies that in turn remit these payments to the Company. Balances due to the Company resulting from premium payments made to these agencies are unsecured. |
Litigation
Litigation | 12 Months Ended |
Dec. 31, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Litigation | 1 4 . Litigation The Company is named as a defendant in various lawsuits, arising in the ordinary course of business, generally relating to its insurance operations. All legal actions relating to claims made under insurance policies are considered by the Company in establishing its loss and loss adjustment expense reserves. The Company also faces lawsuits from time to time that seek damages beyond policy limits, commonly known as bad faith claims, as well as class action and individual lawsuits that involve issues arising in the course of the Company’s business. The Company continually evaluates potential liabilities and reserves for litigation of these types using the criteria established by FASB ASC 450, Contingencies In January 2014, one current and three former employees filed a collective action lawsuit against the Company in the U.S. District Court for the Middle District of Tennessee. The suit Lykins, et al. v. First Acceptance Corporation, et al., alleged the Company violated the Fair Labor Standards Act by misclassifying its insurance agents as exempt employees. Plaintiffs sought unpaid wages, liquidated damages, overtime, attorneys’ fees and costs. Thompson v. First Acceptance Corporation, et al., was later filed by eight individuals who presented opt-in consent forms after the notice period of the first case. These plaintiffs were also seeking unpaid overtime. The Company answered both plaintiffs’ complaints and denied all of the allegations contained therein. In April 2014, the class of agents from both cases was conditionally certified and a notice regarding the cases was sent to all potential class members. A total of 235 individuals chose to participate in the cases during the opt-in period. The Company disagreed with the allegations in these lawsuits and believed that it was able to present a vigorous defense. Since any such litigation would likely have has a lengthy duration and required the Company to incur significant legal expense, in August 2015, the Company and the plaintiffs entered into a stipulation of settlement providing for the release and dismissal of all asserted claims in exchange for an aggregate payment $3.2 million by the Company that was approved by the court and paid in December 2015. The total financial impact of this litigation on the Company, including the aggregate settlement payment, related payroll taxes and the Company’s legal costs in connection with the defense of the litigation, has been presented separately in the consolidated statements of operations and comprehensive income (loss) under the litigation settlement expense line item for all periods presented. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Segment Information | 1 5 . Segment Information The Company operates in two business segments with its primary focus being the selling, servicing and underwriting of non-standard personal automobile insurance. The real estate and corporate segment consists of the activities related to the disposition of foreclosed real estate held for sale, interest expense associated with all debt and other general corporate overhead expenses. The insurance segment includes the former Titan retail locations since their July 1, 2015 acquisition. See Note 17 for additional information on this business combination. The following table presents selected financial data by business segment (in thousands). Year Ended December 31, 2015 2014 2013 Revenues: Insurance $ 331,828 $ 263,133 $ 240,460 Real estate and corporate 64 61 52 Consolidated total $ 331,892 $ 263,194 $ 240,512 Income (loss) before income taxes: Insurance $ 338 $ 12,549 $ 12,748 Real estate and corporate (2,910 ) (2,826 ) (2,918 ) Consolidated total $ (2,572 ) $ 9,723 $ 9,830 December 31, 2015 2014 Total assets: Insurance $ 373,475 $ 302,529 Real estate and corporate 28,652 25,916 Consolidated total $ 402,127 $ 328,445 |
Statutory Financial Information
Statutory Financial Information and Accounting Policies | 12 Months Ended |
Dec. 31, 2015 | |
Insurance [Abstract] | |
Statutory Financial Information and Accounting Policies | 16 . Statutory Financial Information and Accounting Policies The statutory-basis financial statements of the Insurance Companies are prepared in accordance with accounting practices prescribed or permitted by the Department of Insurance in each respective state of domicile. Each state of domicile requires that insurance companies domiciled in the state prepare their statutory-basis financial statements in accordance with the National Association of Insurance Commissioners Accounting Practices and Procedures Manual At December 31, 2015 and 2014, on a consolidated statutory basis, the capital and surplus of the Insurance Companies was $98.8 million and $96.6 million, respectively. For the years ended December 31, 2015, 2014 and 2013, consolidated statutory net income (loss) of the Insurance Companies was ($7.3) million, $1.0 million and $4.2 million, respectively. The maximum amount of dividends which can be paid by First Acceptance Insurance Company, Inc. (“FAIC”) to the Company, without the prior approval of the Texas insurance commissioner, is limited to the greater of 10% of statutory capital and surplus at December 31 st |
Business Combination
Business Combination | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Business Combination | 17. Business Combination Acquisition of the Titan Agencies On July 1, 2015, in order to expand its geographic presence, the Company completed the acquisition of certain assets of Titan Insurance Services, Inc. and Titan Auto Insurance of New Mexico, Inc. (the “Titan Agencies”). These agencies sell private passenger non-standard automobile insurance and complimentary products, principally in California, but also in Texas, Arizona, Florida, Nevada and New Mexico. The Titan Agencies were previously owned and operated by Nationwide. Pursuant to the Asset Purchase Agreement (the “APA”), the Company acquired the assets of 83 retail stores for total consideration of $36.0 million, which included liabilities assumed estimated to be $2.3 million. The Company has accounted for the acquisition as a business combination applying the acquisition method. The acquisition was partially financed with the proceeds from a $30 million term loan from the principal stockholder. See Note 10 for additional information on the term loan. In connection with this acquisition, the Company also entered into an insurance agency contract with Nationwide under which it anticipates writing some of the business produced through these retail locations. Purchase Price Allocation The following table summarizes the estimated fair value of the assets acquired at the date of acquisition: Tangible assets $ 1,847 Identifiable intangible asset 4,000 Goodwill 30,200 Total assets acquired 36,047 Less: liabilities assumed (2,277 ) Total cash paid $ 33,770 The identifiable intangible asset represents policy renewal rights and customer relationships. The fair value was determined using an “excess earnings” method that relied on projected future net cash flows including key assumptions for the customer retention and renewal rates. Accordingly, amortization will be recorded over 7.5 years on an accelerated basis and will decline in subsequent years in proportion to projected policy expirations. For the year ended December 31, 2015, $0.5 million relating to the identifiable intangible asset was amortized against income. Goodwill and the identifiable intangible asset from this acquisition will be deductible for tax purposes. Liabilities assumed included a $2.0 million estimate of the expected liability for returned commissions as of the closing date. This liability is subject to change based on the actual amount of returned commissions. This, or any other change in the fair value determinations, would result in an adjustment to goodwill. At December 31, 2015, the Company’s new estimation of this liability resulted in a $0.8 million reduction in goodwill. A final determination will be made as of the June 30, 2016 measurement date. The results of the acquired retail locations have been included in the Company’s consolidated statement of operations and comprehensive income (loss) from the July 1, Pro Forma Information The following unaudited pro forma combined statement of loss for the year ended December 31, 2015 and statement of income for the year ended December 31, 2014 are based on our historical consolidated financial statements and give effect to the acquisition of the Titan Agencies as if it had occurred on January 1, 2014. The Company’s historical results for the year ended December 31, 2015 includes the results of the former Titan Agencies for the six months since the July 1, 2015 acquisition date. The pro forma adjustments, including interest expense on the debt incurred to finance the acquisition, reflect the combined results as if the acquisition occurred on January 1, 2014. There are no adjustments for the effect of any synergies achieved as a result of the acquisition. The pro forma combined financial statements do not necessarily reflect what the combined results of operations would have been had the acquisition occurred on the date indicated. They also may not be useful in predicting the future combined results of operations. The actual combined results of operations may differ significantly from the combined pro forma amounts reflected herein due to a variety of factors. Pro Forma Statement of Loss Year Ended December 31, 2015 Company Historical Titan Agencies Historical Six Months Ended June 30, 2015 Pro Forma Adjustments Pro Forma Combined Revenues: Premiums earned $ 266,987 $ — $ — $ 266,987 Commission and fee income 59,892 14,547 — 74,439 Investment income 5,024 — — 5,024 Net realized losses on investments, available-for-sale (11 ) — — (11 ) 331,892 14,547 — 346,439 Costs and expenses: Losses and loss adjustment expenses 219,031 — — 219,031 Insurance operating expenses 105,254 14,555 (81 ) (a) 119,728 Other operating expenses 1,126 — — 1,126 Litigation settlement 3,677 — — 3,677 Stock-based compensation 144 — — 144 Depreciation 1,751 — 50 (b) 1,801 Amortization of identifiable intangible assets 514 — 320 (c) 834 Interest expense 2,967 — 1,190 (d) 4,157 334,464 14,555 1,479 350,498 Loss before income taxes (2,572 ) (8 ) (1,479 ) (4,059 ) Income tax benefit (642 ) (3 ) (592 ) (e) (1,237 ) Net loss per share: $ (1,930 ) $ (5 ) $ (887 ) $ (2,822 ) Net loss per share: Basic $ (0.05 ) $ (0.07 ) Diluted $ (0.05 ) $ (0.07 ) Number of shares used to calculate net loss per share: Basic 41,030 41,030 Diluted 41,030 41,030 Pro Forma Statement of Income Year Ended December 31, 2014 Company Historical Titan Agencies Historical Pro Forma Adjustments Pro Forma Combined Revenues: Premiums earned $ 218,315 $ — $ — $ 218,315 Commission and fee income 39,733 28,222 — 67,955 Investment income 5,123 — — 5,123 Net realized gains on investments, available-for-sale 23 — — 23 263,194 28,222 — 291,416 Costs and expenses: Losses and loss adjustment expenses 161,302 — — 161,302 Insurance operating expenses 87,328 27,325 — 114,653 Other operating expenses 996 — — 996 Litigation settlement 187 — — 187 Stock-based compensation 185 — — 185 Depreciation 1,767 — 100 (b) 1,867 Amortization of identifiable intangible assets — — 942 (c) 942 Interest expense 1,706 — 2,426 (d) 4,132 253,471 27,325 3,468 284,264 Income before income taxes 9,723 897 (3,468 ) 7,152 Provision (benefit) for income taxes (18,345 ) 359 (1,387 ) (e) (19,373 ) Net income $ 28,068 $ 538 $ (2,081 ) $ 26,525 Net income per share: Basic $ 0.68 $ 0.65 Diluted $ 0.68 $ 0.64 Number of shares used to calculate net income per share: Basic 40,985 40,985 Diluted 41,283 41,283 Pro forma adjustments The following adjustments have been reflected in the unaudited pro forma combined financial information. (a) Elimination of acquisition costs incurred (b) Depreciation expense related to acquired tangible asset (c) Amortization expense related to acquired identifiable intangible asset (d) Interest expense related to acquisition financing (including amortization of issuance costs) (e) Calculated income tax effect of pro forma adjustments at the estimated combined federal and state statutory rate of 40% |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | 1 8 . Selected Quarterly Financial Data (unaudited) Interim results are not necessarily indicative of fiscal year performance because of the impact of seasonal and short-term variations. Selected quarterly financial data is summarized as follows (in thousands, except per share data). Total Revenues Income (Loss) Before Income Taxes Net Income (Loss) Basic and Diluted Net Income (Loss) Per Share Year Ended December 31, 2015: December 31, 2015 $ 88,536 $ 458 $ 287 $ — September 30, 2015 87,620 (4,524 ) (3,018 ) (0.07 ) June 30, 2015 80,631 690 315 0.01 March 31, 2015 75,105 804 486 0.01 Year Ended December 31, 2014: December 31, 2014 $ 67,928 $ 3,076 $ 21,968 $ 0.54 September 30, 2014 65,604 2,377 2,120 0.05 June 30, 2014 67,120 3,723 3,469 0.08 March 31, 2014 62,542 547 511 0.01 Income before income taxes for the quarter ended September 31, 2015 included a $3.4 million litigation settlement. Net income for the quarter ended December 31, 2014 of $22.0 million included $20.2 million in benefit for income taxes resulting from the change in the deferred tax valuation allowance. |
Financial Information of Regist
Financial Information of Registrant (Parent Company) | 12 Months Ended |
Dec. 31, 2015 | |
Condensed Financial Information Of Parent Company Only Disclosure [Abstract] | |
Financial Information of Registrant (Parent Company) | FIRST ACCEPTANCE CORPORATION AND SUBSIDIARIES SCHEDULE II. FINANCIAL INFORMATION OF REGISTRANT (PARENT COMPANY) (in thousands) December 31, Balance Sheets 2015 2014 Assets: Investment in subsidiaries, at equity in net assets $ 132,430 $ 126,494 Cash and cash equivalents 8,095 15,836 Loan to wholly-owned subsidiary 30,010 — Deferred tax asset 8,649 7,965 Other assets 2,142 2,144 $ 181,326 $ 152,439 Liabilities: Debentures payable $ 40,256 $ 40,211 Term loan from principal stockholder 29,753 — Other liabilities 7,647 5,264 Stockholders' equity 103,670 106,964 $ 181,326 $ 152,439 Year Ended December 31, Statement of Operations 2015 2014 2013 Interest income $ 1,328 $ 61 $ 52 Equity in income (loss) of subsidiaries, net of tax (441 ) 23,804 11,657 Expenses (4,238 ) (2,887 ) (2,529 ) Income (loss) before income taxes (3,351 ) 20,978 9,180 Benefit for income taxes (1,421 ) (7,090 ) — Net income (loss) $ (1,930 ) $ 28,068 $ 9,180 Year Ended December 31, Statement of Cash Flows 2015 2014 2013 Cash flows from operating activities: Net income (loss) $ (1,930 ) $ 28,068 $ 9,180 Equity in (income) loss of subsidiaries, net of tax 441 (23,804 ) (11,657 ) Stock-based compensation 144 185 243 Deferred income taxes (684 ) (7,871 ) (2 ) Other (203 ) 28 (6 ) Change in assets and liabilities 2,385 3,197 790 Net cash provided by (used in) operating activities 153 (197 ) (1,452 ) Cash flows from investing activities: Dividends from subsidiary 2,025 7,425 6,635 Loan to wholly-owned subsidiary (30,010 ) — — Investments in subsidiaries (10,000 ) (44 ) — Net cash (used in) provided by investing activities (37,985 ) 7,381 6,635 Cash flows from financing activities: Proceeds from term loan from principal stockholder 30,000 — — Net proceeds from issuance of common stock 91 74 51 Net cash provided by financing activities 30,091 74 51 Net change in cash and cash equivalents (7,741 ) 7,258 5,234 Cash and cash equivalents, beginning of period 15,836 8,578 3,344 Cash and cash equivalents, end of period $ 8,095 $ 15,836 $ 8,578 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2015 | |
Accounting Policies [Abstract] | |
General | General First Acceptance Corporation (the “Company”) is a holding company based in Nashville, Tennessee with operating subsidiaries whose primary operations include the selling, servicing, and underwriting of non-standard personal automobile insurance and related products. Our insurance operations generate revenue from selling non-standard personal automobile insurance products and related products in 17 states. We conduct our servicing and underwriting operations in 13 states and are licensed as an insurer in 12 additional states. The Company issues policies of insurance through three wholly-owned subsidiaries: First Acceptance Insurance Company, Inc., First Acceptance Insurance Company of Georgia, Inc. and First Acceptance Insurance Company of Tennessee, Inc. (collectively, the “Insurance Companies”). |
Basis of Consolidation and Reporting | Basis of Consolidation and Reporting The accompanying consolidated financial statements include the accounts of the Company and its subsidiaries which are all wholly owned. The accounts of First Acceptance Statutory Trust I (“FAST I”) are not consolidated since it does not meet the requirements for consolidation of FASB ASC 810, Consolidation ( . |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. It also requires disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported revenues and expenses during the period. Actual results could differ from those estimates. |
Accounting Change | Accounting Change During the quarter ended December 31, 2015, the Company voluntarily changed the timing of its annual goodwill and identifiable intangible assets impairment testing from June 30th to October 1st of each year. The change in the goodwill and identifiable intangible assets impairment testing date is preferable under the circumstances in order to combine evaluation efforts to provide for a more consistent, efficient, and effective entity-wide impairment testing process as it better aligns the impairment testing procedures with the timing of the Company’s annual budgetary process, which is a significant input to the testing, and it allows the Company more time to accurately complete its impairment testing process in order to incorporate the results in the annual consolidated financial statements. The Company has determined that it is unable to objectively determine, without the use of hindsight, the projected cash flows and related valuation estimates for earlier periods. Therefore, the Company has prospectively applied the change in the annual goodwill and identifiable intangible assets impairment testing date beginning October 1, 2015 as retrospective application to prior periods is deemed impracticable. This change in testing date did not delay, accelerate, or avoid a goodwill or identifiable intangible assets impairment charge. No impairment was recorded in 2015. |
Reclassifications | Reclassifications Certain reclassifications have been made to the prior year’s consolidated financial statements to conform with the current presentation. |
Investments | Investments Investments, available-for-sale at fair value, include bonds with fixed principal payment schedules and mortgage-backed securities which are amortized using the retrospective method. These securities and investments in mutual funds are carried at fair value with the corresponding unrealized appreciation or depreciation, net of deferred income taxes, reported in other comprehensive income (loss). Premiums and discounts on collateralized mortgage obligations (“CMOs”) are amortized over a period based on estimated future principal payments, including prepayments. Prepayment assumptions are reviewed periodically and adjusted to reflect actual prepayments and changes in expectations. The most significant determinants of prepayments are the difference between interest rates on the underlying mortgages and the current mortgage loan rates and the structure of the security. Other factors affecting prepayments include the size, type, and age of underlying mortgages, the geographic location of the mortgaged properties, and the credit worthiness of the borrowers. Variations from anticipated prepayments will affect the life and yield of these securities. Investment securities are exposed to various risks such as interest rate, market, and credit risk. Fair values of securities fluctuate based on changing market conditions. Significant changes in market conditions could materially affect portfolio value in the near term. Management reviews investments for impairment on a quarterly basis. Fair values of investments are based on prices quoted in the most active market for each security. If quoted prices are not available, fair value is estimated based on the fair value of comparable securities, discounted cash flow models or similar methods. Any decline in the fair value of any available-for-sale security below cost that is deemed to be other-than-temporary would result in a reduction in the amortized cost of the security. If management can assert that it does not intend to sell an impaired fixed maturity security and it is more likely than not that it will not have to sell the security before recovery of its amortized cost basis, then an entity must separate other-than-temporary impairments (“OTTI”) into the following two components: (i) the amount related to credit losses, which are charged against income, and (ii) the amount related to all other factors, which are recorded in other comprehensive income (loss). The credit-related portion of an OTTI is measured by comparing a security’s amortized cost to the present value of its current expected cash flows discounted at its effective yield prior to the impairment charge. If management intends to sell an impaired security, or it is more likely than not that it will be required to sell the security before recovery, an impairment charge is required to reduce the amortized cost of that security to fair value. Realized gains and losses on sales and redemptions of securities are computed based on specific identification. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents consist of bank demand deposits and highly-liquid investments, including overnight collateralized repurchase agreements. All investments with maturities of three months or less at the date of purchase are considered cash equivalents. |
Other Investments | Other Investments Other investments consist of limited partnership interests and an investment in the common stock of a real estate investment trust (“REIT”). Limited partnership interests are recorded at net asset value which approximates fair value. Valuations are based upon the GAAP financial statements of the partnerships which are required to be audited annually. The common stock of the REIT is recorded at a fair value with the corresponding unrealized appreciation or depreciation, net of deferred income taxes, reported in other comprehensive income (loss). The change in net asset value of limited partnership interests and any dividends paid by the REIT are recorded in investment income in the consolidated statements of comprehensive income (loss). |
Revenue Recognition | Revenue Recognition Insurance premiums earned include policy and renewal fees and are recognized on a pro-rata basis over the respective terms of the policies. Written premiums are recorded as of the effective date of the policies for the full policy premium, although most policyholders elect to pay on a monthly installment basis. Premiums and fees are generally collected in advance of providing risk coverage, minimizing the Company’s exposure to credit risk. Premiums receivable are recorded net of an estimated allowance for uncollectible amounts. Commission and fee income includes installment fees recognized when billed, commissions and fees from ancillary products recognized on a pro-rata basis over the respective terms of the contracts, and commissions and related policy fees, written for third-party insurance companies, recognized, at the date the customer is initially billed or as of the effective date of the insurance policy, whichever is later. A liability for returned commissions is established for the amount of commission income received that the Company estimates (based on historical experience) will be returned to third-party insurance companies as a result of policy cancellations. |
Income Taxes | Income Taxes Income taxes are accounted for under the liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. A valuation allowance for the deferred taxes is established based upon management’s estimate of whether it is more likely than not that the Company would not realize tax benefits in future periods to the full extent available. Changes in the valuation allowance are recognized in income during the period in which the circumstances that cause such a change in management’s estimate occur. The Company accounts for income tax uncertainties under the provisions of FASB ASC 740, Income Taxes |
Property and Equipment | Property and Equipment Property and equipment are initially recorded at cost. Depreciation is provided over the estimated useful lives of the assets (generally ranging from three to five years) using the straight-line method. Leasehold improvements are amortized over the shorter of the lives of the respective leases or the service lives of the improvements. Repairs and maintenance are charged to expense as incurred. Equipment under capitalized lease obligations is stated at the present value of the minimum lease payments at the beginning of the lease term. |
Foreclosed Real Estate Held for Sale | Foreclosed Real Estate Held for Sale Foreclosed real estate held for sale is recorded at the lower of cost or fair value less estimated costs to sell. The Company periodically reviews its portfolio of foreclosed real estate held for sale using current information including (i) independent appraisals, (ii) general economic factors affecting the area where the property is located, (iii) recent sales activity and asking prices for comparable properties and (iv) costs to sell and/or develop that would serve to lower the expected proceeds from the disposal of the real estate. Gains (losses) realized on liquidation are recorded directly to operations and included in revenues. Foreclosed real estate held for sale assets of $0.8 million at December 31, 2015 and 2014 are included within other assets in the accompanying consolidated balance sheets. As of December 31, 2015, the Company was under contract to sell a portion of the portfolio. The sale is currently scheduled to close in May 2016 subject to due diligence by the buyer. |
Deferred Acquisition Costs | Deferred Acquisition Costs Deferred acquisition costs include premium taxes and other variable underwriting and direct sales costs incurred in connection with writing successful new and renewal business. These costs are deferred and amortized over the policy period in which the related premiums are earned, to the extent that such costs are deemed recoverable from future unearned premiums and anticipated investment income. Advertising costs are expensed when incurred and are not a part of deferred acquisition costs. Amortization expense for the years ended December 31, 2015, 2014 and 2013 was $16.3 million, $11.4 million and $11.1 million, respectively, and is included within insurance operating expenses in the accompanying consolidated statements of operations and comprehensive income (loss). |
Goodwill and Other Identifiable Intangible Assets | Goodwill and Other Identifiable Intangible Assets Goodwill and identifiable intangible assets are attributable to the Company’s insurance operations and were initially recorded at their estimated fair values at their dates of acquisition. Identifiable intangible assets with an indefinite life, (trade name and state insurance licenses) are not amortized for financial statement purposes while those with a definite life (policy renewal rights and customer relationships) are amortized in proportion to projected policy expirations. At December 31, 2015 and 2014, identifiable intangible assets were $9.0 million and $4.8 million, respectively, net of accumulated amortization expense of $0.5 million and $0.0 million, respectively. The estimated amortization expense for the five succeeding fiscal years is $1.0 million, $0.7 million, $0.5 million, $0.5 million, and $0.4 million. The Company performs required annual impairment tests of its goodwill and identifiable intangible assets as of October 1st of each year. In the event that facts and circumstances indicate that goodwill or identifiable intangible assets may be impaired, an interim impairment test would be required. The Company follows the accounting guidelines, which allows companies to waive comparing the fair value of goodwill and intangible assets to their carrying amounts in assessing the recoverability of these assets if, based on qualitative factors, it is more likely than not that the fair value of the goodwill and intangible assets is greater than their carrying amounts. |
Loss and Loss Adjustment Expense Reserves | Loss and Loss Adjustment Expense Reserves Loss and loss adjustment expense reserves are undiscounted and represent case-basis estimates of reported losses and estimates based on certain actuarial assumptions regarding the past experience of reported losses, including an estimate of losses incurred but not reported. Management believes that the loss and loss adjustment reserves are adequate to cover the ultimate associated liability. However, such estimates may be more or less than the amount ultimately paid when the claims are finally settled. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In February 2013, the FASB issued ASU 2013-02, Presentation of Comprehensive Income In May 2014, the Financial Accounting Standards Board (“FASB”) and the International Accounting Standards Board (“IASB”) jointly issued a new revenue recognition standard, Accounting Standard Update (“ASU”) No. 2014-09, “ Revenue from Contracts with Customers,” In May 2014, the FASB issued ASU No. 2015-09, “ Financial Services-Insurance (Topic 944): Disclosures about Short-Duration Contracts” In April 2015, the FASB issued ASU No. 2015-03, “ Interest-Imputation of Interest” In April 2015, the FASB issued ASU No. 2015-05, “ Intangibles-Goodwill and Other-Internal Use Software (Subtopic 350-40): Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement” In May 2015, the FASB issued ASU No. 2015-07, “Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent)” In September 2015, the FASB issued ASU No. 2015-16, “Business Combination (Topic 805): Simplifying the Accounting for Measurement-period Adjustments” |
Supplemental Cash Flow Information | Supplemental Cash Flow Information During the years ended December 31, 2015, 2014 and 2013, the Company paid $0.7 million, $0.7 million and $0.5 million, respectively, in income taxes and $1.7 million, $1.7 million and $1.7 million, respectively, in interest. |
Basic and Diluted Net Income (Loss) Per Share | Basic and Diluted Net Income (Loss) Per Share Basic net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of common shares, while diluted net income (loss) per share is computed by dividing net income (loss) available to common shareholders by the weighted average number of such common shares and dilutive share equivalents. Dilutive share equivalents result from the assumed exercise of employee stock options restricted stock units and are calculated using the treasury stock method. |
Fair Value (Tables)
Fair Value (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Fair Value Disclosures [Abstract] | |
Presentation of Carrying Values and Fair Values of Certain of Company's Financial Instruments | The carrying values and fair values of certain of the Company’s financial instruments were as follows (in thousands). December 31, 2015 December 31, 2014 Carrying Fair Carrying Fair Value Value Value Value Assets: Investments, available-for-sale $ 131,582 $ 131,582 $ 125,085 $ 125,085 Other investments 11,256 11,256 10,530 10,530 Liabilities: Debentures payable 40,256 20,275 40,211 19,606 Term loan from principal stockholder 29,753 28,504 — — |
Presentation of Fair-Value Measurements for Each Major Category of Assets Measured on Recurring Basis | The following tables present the fair-value measurements for each major category of assets that are measured on a recurring basis (in thousands). Fair Value Measurements Using Quoted Prices Significant in Active Other Significant Proportionate Markets for Observable Unobservable Share of Identical Assets Inputs Inputs Net Assets December 31, 2015 Total (Level 1) (Level 2) (Level 3) (NAV) Fixed maturities, available-for-sale: U.S. government and agencies $ 13,113 $ 13,113 $ — $ — $ — State 702 — 702 — — Political subdivisions 4,363 — 4,363 — — Revenue and assessment 12,644 — 12,644 — — Corporate bonds 80,785 — 80,785 — — Collateralized mortgage obligations: Agency backed 873 — 873 — — Non-agency backed – residential 3,455 — 3,455 — — Non-agency backed – commercial 2,507 — 2,507 — — Total fixed maturities, available-for-sale 118,442 13,113 105,329 — — Preferred stock, available-for-sale 1,723 1,723 — — — Mutual funds, available-for-sale 11,417 11,417 — — — Total investments, available-for-sale 131,582 26,253 105,329 — — Other investments 11,256 — — 3,276 7,980 Cash and cash equivalents 115,587 115,587 — — — Total $ 258,425 $ 141,840 $ 105,329 $ 3,276 $ 7,980 Fair Value Measurements Using Quoted Prices Significant in Active Other Significant Proportionate Markets for Observable Unobservable Share of Identical Assets Inputs Inputs Net Assets December 31, 2014 Total (Level 1) (Level 2) (Level 3) (NAV) Fixed maturities, available-for-sale: U.S. government and agencies $ 8,290 $ 8,290 $ — $ — $ — State 725 — 725 — — Political subdivisions 506 — 506 — — Revenue and assessment 16,360 — 16,360 — — Corporate bonds 75,119 — 75,119 — — Collateralized mortgage obligations: Agency backed 4,807 — 4,807 — — Non-agency backed – residential 4,137 — 4,137 — — Non-agency backed – commercial 3,078 — 3,078 — — Total fixed maturities, available-for-sale 113,022 8,290 104,732 — — Preferred stock, available-for-sale 1,767 1,767 — — — Mutual funds, available-for-sale 10,296 10,296 — — — Total investments, available-for-sale 125,085 20,353 104,732 — — Other investment 10,530 — — 947 9,583 Cash and cash equivalents 102,429 102,429 — — — Total $ 238,044 $ 122,782 $ 104,732 $ 947 $ 9,583 |
Quantitative Disclosure for Assets Classified as Level 3 | The following table represents the quantitative disclosure for those assets classified as Level 3 during the year ended December 31, 2015 (in thousands). Fair Value Measurements Using Significant Unobservable Inputs (Level 3) Common Stock at Fair Value Balance at December 31, 2014 $ 947 Gains included in net income (loss) — Gains included in comprehensive income (loss) 229 Investments and capital calls 2,100 Distributions received — Transfers into and out of Level 3 — Balance at December 31, 2015 $ 3,276 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Company's Investment Securities | The following tables summarize the Company’s investment securities (in thousands). Gross Gross Amortized Unrealized Unrealized Fair December 31, 2015 Cost Gains Losses Value U.S. government and agencies $ 13,036 $ 162 $ (85 ) $ 13,113 State 698 4 — 702 Political subdivisions 4,354 9 — 4,363 Revenue and assessment 11,770 895 (21 ) 12,644 Corporate bonds 79,426 2,022 (663 ) 80,785 Collateralized mortgage obligations: Agency backed 793 80 — 873 Non-agency backed – residential 2,877 579 (1 ) 3,455 Non-agency backed – commercial 1,891 616 — 2,507 Total fixed maturities, available-for-sale 114,845 4,367 (770 ) 118,442 Preferred stock, available-for-sale 1,500 223 — 1,723 Mutual funds, available-for-sale 11,959 120 (662 ) 11,417 $ 128,304 $ 4,710 $ (1,432 ) $ 131,582 Gross Gross Amortized Unrealized Unrealized Fair December 31, 2014 Cost Gains Losses Value U.S. government and agencies $ 8,039 $ 277 $ (26 ) $ 8,290 State 698 27 — 725 Political subdivisions 500 6 — 506 Revenue and assessment 14,856 1,522 (18 ) 16,360 Corporate bonds 73,051 2,698 (630 ) 75,119 Collateralized mortgage obligations: Agency backed 4,647 160 — 4,807 Non-agency backed – residential 3,513 624 — 4,137 Non-agency backed – commercial 2,414 664 — 3,078 Total fixed maturities, available-for-sale 107,718 5,978 (674 ) 113,022 Preferred stock, available-for-sale 1,500 267 — 1,767 Mutual funds, available-for-sale 9,901 403 (8 ) 10,296 $ 119,119 $ 6,648 $ (682 ) $ 125,085 |
Scheduled Maturities of Company's Fixed Maturity Securities Based on their Fair Values | The following table sets forth the scheduled maturities of the Company’s fixed maturity securities based on their fair values (in thousands). Actual maturities may differ from contractual maturities because certain securities may be called or prepaid by the issuers. Securities Securities Securities with No All with with Unrealized Fixed Unrealized Unrealized Gains or Maturity December 31, 2015 Gains Losses Losses Securities One year or less $ 3,715 $ 1,036 $ 1,550 $ 6,301 After one through five years 17,383 15,650 — 33,033 After five through ten years 31,952 31,854 — 63,806 After ten years 8,467 — — 8,467 No single maturity date 6,641 194 — 6,835 $ 68,158 $ 48,734 $ 1,550 $ 118,442 |
Fair Value and Gross Unrealized Losses of Investments, Available-for-Sale, by the Length of Time | The fair value and gross unrealized losses of investments, available-for-sale, by the length of time that individual securities have been in a continuous unrealized loss position follows (in thousands). Less than 12 months 12 months or longer December 31, 2015 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Total Gross Losses U.S. government and agencies $ 8,946 $ (85 ) $ — $ — $ (85 ) State — — — — — Political subdivisions — — — — — Revenue and assessment 1,733 (21 ) — — (21 ) Corporate bonds 30,172 (422 ) 7,689 (241 ) (663 ) Collateralized mortgage obligations: Agency backed — — — — — Non-agency backed – residential 5 (1 ) — — (1 ) Non-agency backed – commercial 189 — — — — Total fixed maturities, available-for-sale 41,045 (529 ) 7,689 (241 ) (770 ) Preferred stock, available-for-sale — — — — — Mutual funds, available-for-sale 8,839 (662 ) — — (662 ) $ 49,884 $ (1,191 ) $ 7,689 $ (241 ) $ (1,432 ) Less than 12 months 12 months or longer December 31, 2014 Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Total Gross Losses U.S. government and agencies $ 5,012 $ (26 ) $ — $ — $ (26 ) State — — — — — Political subdivisions — — — — — Revenue and assessment 2,820 (18 ) — — (18 ) Corporate bonds 7,681 (38 ) 20,567 (592 ) (630 ) Collateralized mortgage obligations: Agency backed — — — — — Non-agency backed – residential — — — — — Non-agency backed – commercial — — — — — Total fixed maturities, available-for-sale 15,513 (82 ) 20,567 (592 ) (674 ) Preferred stock, available-for-sale — — — — — Mutual funds, available-for-sale 1,992 (8 ) — — (8 ) $ 17,505 $ (90 ) $ 20,567 $ (592 ) $ (682 ) |
Number of Fixed Maturity Securities with Gross Unrealized Gains and Losses | The following table reflects the number of fixed maturity securities with gross unrealized gains and losses. Gross unrealized losses are further segregated by the length of time that individual securities have been in a continuous unrealized loss position. Gross Unrealized Losses Less than Greater Gross or equal to than 12 Unrealized At: 12 months months Gains December 31, 2015 21 4 70 December 31, 2014 9 9 80 |
Fair Value and Gross Unrealized Losses of Fixed Maturity Securities in Continuous Unrealized Loss Position for Greater than 12 Months | The following tables reflect the fair value and gross unrealized losses of those fixed maturity securities in a continuous unrealized loss position for greater than 12 months. Gross unrealized losses are further segregated by the percentage of amortized cost (in thousands, except number of securities). Number Gross Gross Unrealized Losses of Fair Unrealized at December 31, 2015: Securities Value Losses Less than or equal to 10% 4 $ 7,689 (241 ) Greater than 10% — — — 4 $ 7,689 $ (241 ) Number Gross Gross Unrealized Losses of Fair Unrealized at December 31, 2014: Securities Value Losses Less than or equal to 10% 9 $ 20,567 $ (592 ) Greater than 10% — — — 9 $ 20,567 $ (592 ) |
Gross Unrealized Losses by Current Severity and Length of Time that Individual Securities have been in Continuous Unrealized Loss Position | The following tables set forth the amount of gross unrealized losses by current severity (as compared to amortized cost) and length of time that individual securities have been in a continuous unrealized loss position (in thousands). Fair Value of Securities with Length of Gross Gross Severity of Gross Unrealized Losses Gross Unrealized Losses Unrealized Unrealized Less 5% to Greater at December 31, 2015: Losses Losses than 5% 10% than 10% Less than or equal to: Three months $ 20,899 $ (130 ) $ (130 ) $ — $ — Six months 7,036 (465 ) — (465 ) — Nine months 14,057 (395 ) (197 ) (197 ) (1 ) Twelve months 7,892 (201 ) (201 ) — — Greater than twelve months 7,689 (241 ) (241 ) — — Total $ 57,573 $ (1,432 ) $ (769 ) $ (662 ) $ (1 ) Fair Value of Securities with Length of Gross Gross Severity of Gross Unrealized Losses Gross Unrealized Losses Unrealized Unrealized Less 5% to Greater at December 31, 2014: Losses Losses than 5% 10% than 10% Less than or equal to: Three months $ 17,505 $ (90 ) $ (90 ) $ — $ — Six months — — — — — Nine months — — — — — Twelve months — — — — — Greater than twelve months 20,567 (592 ) (592 ) — — Total $ 38,072 $ (682 ) $ (682 ) $ — $ — |
Major Categories of Investment Income | The major categories of investment income follow (in thousands). Year Ended December 31, 2015 2014 2013 Fixed maturities, available-for-sale $ 4,220 $ 4,481 $ 4,914 Mutual funds, available-for-sale 666 832 766 Other investments 396 85 399 Other 236 214 213 Investment expenses (494 ) (489 ) (576 ) $ 5,024 $ 5,123 $ 5,716 |
Components of Net Realized Gains (Losses) on Investments, Available-For-Sale at Fair Value | The components of net realized gains (losses) on investments, available-for-sale follow (in thousands). Year Ended December 31, 2015 2014 2013 Gains $ 15 $ 85 $ 100 Losses (26 ) (62 ) (68 ) Other than temporary impairment — — (61 ) $ (11 ) $ 23 $ (29 ) |
Progression of Credit-Related Portion of OTTI on Investments | The following is a progression of the credit-related portion of OTTI on investments owned at December 31, 2015, 2014, and 2013 (in thousands). Year Ended December 31, 2015 2014 2013 Beginning balance $ (2,632 ) $ (2,632 ) $ (2,666 ) Additional credit impairments on: Previously impaired securities — — (61 ) Securities without previous impairments — — — — — (61 ) Reductions for securities deemed worthless (realized) — — 95 $ (2,632 ) $ (2,632 ) $ (2,632 ) |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Insurance [Abstract] | |
Effects of Reinsurance Premium Written and Earned | Total premiums written and earned are summarized as follows (in thousands). Year Ended December 31, 2015 2014 2013 Written Earned Written Earned Written Earned Direct $ 247,498 $ 233,652 $ 200,983 $ 191,093 $ 177,376 $ 176,588 Assumed 35,500 33,707 29,311 27,487 23,768 23,313 Ceded (372 ) (372 ) (265 ) (265 ) (201 ) (201 ) Total $ 282,626 $ 266,987 $ 230,029 $ 218,315 $ 200,943 $ 199,700 |
Ceded Premiums Earned and Reinsurance Recoveries on Losses and Loss Adjustment Expenses | Ceded premiums earned and reinsurance recoveries on losses and loss adjustment expenses were as follows (in thousands): Year Ended December 31, 2015 2014 2013 Ceded premiums earned $ 372 $ 265 $ 201 Reinsurance recoveries on losses and loss adjustment expenses $ 239 $ 137 $ 285 |
Stock-Based Compensation Plans
Stock-Based Compensation Plans (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of the Activity for the Company's Stock Option Awards | A summary of the activity for the Company’s Stock Option Awards is presented below (in thousands, except per share data). Options Exercise Price Weighted Average Exercise Price Aggregated Intrinsic Value Options outstanding at December 31, 2012 1,595 $1.45-$8.13 $ 2.38 Forfeited (358 ) $3.04 $ 3.04 Options outstanding at December 31, 2013 1,237 $1.45-$8.13 $ 2.19 Forfeited (117 ) $5.22 $ 5.22 Options outstanding at December 31, 2014 1,120 $1.45-$3.04 $ 1.87 Forfeited (35 ) $3.04 $ 3.04 Options outstanding at December 31, 2015 1,085 $1.45-$3.04 $ 1.83 $ 767 Options exercisable/vested at December 31, 2015 1,070 $ 1.84 $ 753 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Property Plant And Equipment [Abstract] | |
Components of Property and Equipment | The components of property and equipment are as follows (in thousands). Year Ended December 31, 2015 2014 Furniture and equipment $ 12,878 $ 10,660 Leasehold improvements 6,451 5,000 Capitalized leases 238 238 Aircraft 190 190 19,757 16,088 Less: Accumulated depreciation (14,616 ) (12,915 ) Property and equipment, net $ 5,141 $ 3,173 |
Lease Commitments (Tables)
Lease Commitments (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Leases [Abstract] | |
Summary of Future Minimum Lease Payments | Future minimum lease payments under these agreements follow (in thousands). For the Year Ended December 31, Amount 2016 $ 7,079 2017 3,991 2018 2,027 2019 924 2020 631 Thereafter 1,483 Total $ 16,135 |
Losses and Loss Adjustment Ex35
Losses and Loss Adjustment Expenses Incurred and Paid (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Insurance [Abstract] | |
Information Regarding the Reserve for Unpaid Losses and Loss Adjustment Expenses | Information regarding the reserve for unpaid losses and loss adjustment expenses (“LAE”) is as follows (in thousands). Year Ended December 31, 2015 2014 2013 Liability for unpaid losses and LAE at beginning of year, gross $ 96,613 $ 84,286 $ 79,260 Reinsurance balances receivable (362 ) (305 ) (260 ) Liability for unpaid losses and LAE at beginning of year, net 96,251 83,981 79,000 Add: Provision for lossses and LAE: Current year 218,186 166,185 145,877 Prior year 845 (4,883 ) (3,038 ) Net losses and LAE incurred 219,031 161,302 142,839 Less: Losses and LAE paid: Current year 129,216 98,442 88,726 Prior year 64,459 50,590 49,132 Net losses and LAE paid 193,675 149,032 137,858 Liability for unpaid losses and LAE at end of year, net 121,607 96,251 83,981 Reinsurance balances receivable 464 362 305 Liability for unpaid losses and LAE at end of year, gross $ 122,071 $ 96,613 $ 84,286 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Income Tax Disclosure [Abstract] | |
Provision (Benefit) for Income Taxes | The provision (benefit) for income taxes consisted of the following (in thousands). Year Ended December 31, 2015 2014 2013 Federal: Current $ 20 $ 228 $ 175 Deferred (893 ) (19,098 ) (4 ) (873 ) (18,870 ) 171 State: Current 255 650 476 Deferred (24 ) (125 ) 3 231 525 479 $ (642 ) $ (18,345 ) $ 650 |
Provision (Benefit) for Income Taxes Differs from Amounts Computed by Applying Statutory Federal Corporate Tax Rate | The provision (benefit) for income taxes differs from the amounts computed by applying the statutory federal corporate tax rate of 35% to income (loss) before income taxes as a result of the following (in thousands). Year Ended December 31, 2015 2014 2013 Provision (benefit) for income taxes at statutory rate $ (900 ) $ 3,403 $ 3,440 Tax effect of: Tax-exempt investment income (22 ) (21 ) (27 ) Change in the beginning of the period balance of the valuation allowance for deferred tax assets allocated to federal income taxes 9 (22,427 ) (4,277 ) Stock-based compensation 22 137 1,133 State income taxes, net of federal income tax benefit and state valuation allowance 142 525 479 Permanent items 107 38 (98 ) $ (642 ) $ (18,345 ) $ 650 |
Summary of Net Deferred Tax Assets and Liabilities | The tax effects of temporary differences that give rise to the net deferred tax assets and liabilities are presented below (in thousands). Year Ended December 31, 2015 2014 Deferred tax assets: Net operating loss carryforwards $ 6,859 $ 6,180 Stock-based compensation 421 402 Unearned premiums and loss and loss adjustment expense reserves 6,797 5,614 Goodwill and identifiable intangible assets 4,252 5,404 Alternative minimum tax (“AMT”) credit carryforwards 2,015 2,004 Accrued expenses and other nondeductible items 1,551 1,201 Other 3,528 3,127 25,423 23,932 Deferred tax liabilities: Deferred acquisition costs (1,928 ) (1,211 ) Identifiable intangible assets (1,872 ) (1,872 ) Net unrealized change on investments (1,244 ) (2,105 ) Other (332 ) (460 ) (5,376 ) (5,648 ) Total net deferred tax asset 20,047 18,284 Less: Valuation allowance (1,746 ) (1,763 ) Net deferred tax asset $ 18,301 $ 16,521 |
Net Income (Loss) Per Share (Ta
Net Income (Loss) Per Share (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Earnings Per Share [Abstract] | |
Computation of Basic and Diluted Net Income (Loss) Per Share | The following table sets forth the computation of basic and diluted net income (loss) per share (in thousands, except per share data). Year Ended December 31, 2015 2014 2013 Net income (loss) $ (1,930 ) $ 28,068 $ 9,180 Weighted average common basic shares 41,030 40,985 40,930 Effect of dilutive securities — 298 162 Weighted average common dilutive shares 41,030 41,283 41,092 Basic and diluted net income (loss) per share $ (0.05 ) $ 0.68 $ 0.22 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Segment Reporting [Abstract] | |
Selected Financial Data by Business Segment | The following table presents selected financial data by business segment (in thousands). Year Ended December 31, 2015 2014 2013 Revenues: Insurance $ 331,828 $ 263,133 $ 240,460 Real estate and corporate 64 61 52 Consolidated total $ 331,892 $ 263,194 $ 240,512 Income (loss) before income taxes: Insurance $ 338 $ 12,549 $ 12,748 Real estate and corporate (2,910 ) (2,826 ) (2,918 ) Consolidated total $ (2,572 ) $ 9,723 $ 9,830 December 31, 2015 2014 Total assets: Insurance $ 373,475 $ 302,529 Real estate and corporate 28,652 25,916 Consolidated total $ 402,127 $ 328,445 |
Business Combination (Tables)
Business Combination (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Summary of Estimated Fair Value of Asset Acquired At The Date of Acquisition | The following table summarizes the estimated fair value of the assets acquired at the date of acquisition: Tangible assets $ 1,847 Identifiable intangible asset 4,000 Goodwill 30,200 Total assets acquired 36,047 Less: liabilities assumed (2,277 ) Total cash paid $ 33,770 |
Business Combination Pro Forma Information | Pro Forma Statement of Loss Year Ended December 31, 2015 Company Historical Titan Agencies Historical Six Months Ended June 30, 2015 Pro Forma Adjustments Pro Forma Combined Revenues: Premiums earned $ 266,987 $ — $ — $ 266,987 Commission and fee income 59,892 14,547 — 74,439 Investment income 5,024 — — 5,024 Net realized losses on investments, available-for-sale (11 ) — — (11 ) 331,892 14,547 — 346,439 Costs and expenses: Losses and loss adjustment expenses 219,031 — — 219,031 Insurance operating expenses 105,254 14,555 (81 ) (a) 119,728 Other operating expenses 1,126 — — 1,126 Litigation settlement 3,677 — — 3,677 Stock-based compensation 144 — — 144 Depreciation 1,751 — 50 (b) 1,801 Amortization of identifiable intangible assets 514 — 320 (c) 834 Interest expense 2,967 — 1,190 (d) 4,157 334,464 14,555 1,479 350,498 Loss before income taxes (2,572 ) (8 ) (1,479 ) (4,059 ) Income tax benefit (642 ) (3 ) (592 ) (e) (1,237 ) Net loss per share: $ (1,930 ) $ (5 ) $ (887 ) $ (2,822 ) Net loss per share: Basic $ (0.05 ) $ (0.07 ) Diluted $ (0.05 ) $ (0.07 ) Number of shares used to calculate net loss per share: Basic 41,030 41,030 Diluted 41,030 41,030 Pro Forma Statement of Income Year Ended December 31, 2014 Company Historical Titan Agencies Historical Pro Forma Adjustments Pro Forma Combined Revenues: Premiums earned $ 218,315 $ — $ — $ 218,315 Commission and fee income 39,733 28,222 — 67,955 Investment income 5,123 — — 5,123 Net realized gains on investments, available-for-sale 23 — — 23 263,194 28,222 — 291,416 Costs and expenses: Losses and loss adjustment expenses 161,302 — — 161,302 Insurance operating expenses 87,328 27,325 — 114,653 Other operating expenses 996 — — 996 Litigation settlement 187 — — 187 Stock-based compensation 185 — — 185 Depreciation 1,767 — 100 (b) 1,867 Amortization of identifiable intangible assets — — 942 (c) 942 Interest expense 1,706 — 2,426 (d) 4,132 253,471 27,325 3,468 284,264 Income before income taxes 9,723 897 (3,468 ) 7,152 Provision (benefit) for income taxes (18,345 ) 359 (1,387 ) (e) (19,373 ) Net income $ 28,068 $ 538 $ (2,081 ) $ 26,525 Net income per share: Basic $ 0.68 $ 0.65 Diluted $ 0.68 $ 0.64 Number of shares used to calculate net income per share: Basic 40,985 40,985 Diluted 41,283 41,283 Pro forma adjustments The following adjustments have been reflected in the unaudited pro forma combined financial information. (a) Elimination of acquisition costs incurred (b) Depreciation expense related to acquired tangible asset (c) Amortization expense related to acquired identifiable intangible asset (d) Interest expense related to acquisition financing (including amortization of issuance costs) (e) Calculated income tax effect of pro forma adjustments at the estimated combined federal and state statutory rate of 40% |
Selected Quarterly Financial 40
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Selected Quarterly Financial Data | Interim results are not necessarily indicative of fiscal year performance because of the impact of seasonal and short-term variations. Selected quarterly financial data is summarized as follows (in thousands, except per share data). Total Revenues Income (Loss) Before Income Taxes Net Income (Loss) Basic and Diluted Net Income (Loss) Per Share Year Ended December 31, 2015: December 31, 2015 $ 88,536 $ 458 $ 287 $ — September 30, 2015 87,620 (4,524 ) (3,018 ) (0.07 ) June 30, 2015 80,631 690 315 0.01 March 31, 2015 75,105 804 486 0.01 Year Ended December 31, 2014: December 31, 2014 $ 67,928 $ 3,076 $ 21,968 $ 0.54 September 30, 2014 65,604 2,377 2,120 0.05 June 30, 2014 67,120 3,723 3,469 0.08 March 31, 2014 62,542 547 511 0.01 |
Summary of Significant Accoun41
Summary of Significant Accounting Policies - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2015USD ($)State | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Indefinite-lived Intangible Assets [Line Items] | |||
Number of states in which company writes non-standard personal automobile insurance | State | 17 | ||
Number of state in which company conducts servicing and underwriting operations | State | 13 | ||
Number of states in which company is licensed as an insurer | State | 12 | ||
Identifiable intangible assets impairment charge | $ 0 | ||
Original maturities period of highly liquid investments | 3 months | ||
Additional liability or reduction in deferred tax assets for unrecognized tax benefits | $ 0 | $ 0 | |
Foreclosed real estate held for sale assets | 800,000 | 800,000 | |
Amortization expenses | 16,300,000 | 11,400,000 | $ 11,100,000 |
Identifiable intangible asset | 9,000,000 | 4,800,000 | |
Accumulated amortization expense | 500,000 | 0 | |
Estimated amortization expense, Year 1 | 1,000,000 | ||
Estimated amortization expense, Year 2 | 700,000 | ||
Estimated amortization expense, Year 3 | 500,000 | ||
Estimated amortization expense, Year 4 | 500,000 | ||
Estimated amortization expense, Year 5 | 400,000 | ||
Debt issuance cost, reclassified from debentures payable | 124,000 | 130,000 | |
Income taxes | 700,000 | 700,000 | 500,000 |
Interest expense | $ 1,700,000 | $ 1,700,000 | $ 1,700,000 |
Minimum | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Estimated useful lives of the assets | 3 years | ||
Maximum | |||
Indefinite-lived Intangible Assets [Line Items] | |||
Estimated useful lives of the assets | 5 years |
Fair Value - Presentation of Ca
Fair Value - Presentation of Carrying Values and Fair Values of Certain of Company's Financial Instruments (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Assets: | ||
Investments, available-for-sale | $ 131,582 | $ 125,085 |
Other investments | 11,256 | 10,530 |
Liabilities: | ||
Debentures payable | 40,256 | 40,211 |
Term loan from principal stockholder | 29,753 | |
Carrying Value | ||
Assets: | ||
Investments, available-for-sale | 131,582 | 125,085 |
Other investments | 11,256 | 10,530 |
Liabilities: | ||
Debentures payable | 40,256 | 40,211 |
Term loan from principal stockholder | 29,753 | |
Fair Value | ||
Assets: | ||
Investments, available-for-sale | 131,582 | 125,085 |
Other investments | 11,256 | 10,530 |
Liabilities: | ||
Debentures payable | 20,275 | $ 19,606 |
Term loan from principal stockholder | $ 28,504 |
Fair Value - Presentation of Fa
Fair Value - Presentation of Fair-Value Measurements for Each Major Category of Assets Measured on Recurring Basis (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | $ 131,582 | $ 125,085 |
Other investments | 11,256 | 10,530 |
Cash and cash equivalents | 115,587 | 102,429 |
Total | 258,425 | 238,044 |
Fixed Maturities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 118,442 | 113,022 |
Fixed Maturities | U.S. government and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 13,113 | 8,290 |
Fixed Maturities | State | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 702 | 725 |
Fixed Maturities | Political subdivisions | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 4,363 | 506 |
Fixed Maturities | Revenue and assessment | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 12,644 | 16,360 |
Fixed Maturities | Corporate bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 80,785 | 75,119 |
Fixed Maturities | Collateralized mortgage obligations: Agency Backed | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 873 | 4,807 |
Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - residential | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 3,455 | 4,137 |
Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - commercial | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 2,507 | 3,078 |
Preferred stock, available-for-sale | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 1,723 | 1,767 |
Mutual funds, available-for-sale | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 11,417 | 10,296 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 26,253 | 20,353 |
Cash and cash equivalents | 115,587 | 102,429 |
Total | 141,840 | 122,782 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed Maturities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 13,113 | 8,290 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | Fixed Maturities | U.S. government and agencies | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 13,113 | 8,290 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | Preferred stock, available-for-sale | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 1,723 | 1,767 |
Fair Value Measurements Using Quoted Prices in Active Markets for Identical Assets (Level 1) | Mutual funds, available-for-sale | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 11,417 | 10,296 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 105,329 | 104,732 |
Total | 105,329 | 104,732 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 105,329 | 104,732 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | State | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 702 | 725 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Political subdivisions | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 4,363 | 506 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Revenue and assessment | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 12,644 | 16,360 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Corporate bonds | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 80,785 | 75,119 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Collateralized mortgage obligations: Agency Backed | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 873 | 4,807 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - residential | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 3,455 | 4,137 |
Fair Value Measurements Using Significant Other Observable Inputs (Level 2) | Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - commercial | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Investments, available-for-sale | 2,507 | 3,078 |
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Other investments | 3,276 | 947 |
Total | 3,276 | 947 |
Fair Value Measurements Using Proportionate Share of Net Assets (NAV) | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Other investments | 7,980 | 9,583 |
Total | $ 7,980 | $ 9,583 |
Fair Value - Additional Informa
Fair Value - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Fair Value Disclosures [Abstract] | ||
Transfers between level 1 and level 2 | $ 0 | $ 0 |
Fair Value - Quantitative Discl
Fair Value - Quantitative Disclosure for Assets Classified as Level 3 (Detail) - Common Stock at Fair Value $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Fair Value, Assets Measured on Recurring and Nonrecurring Basis [Line Items] | |
Balance at December 31, 2014 | $ 947 |
Gains included in net income (loss) | 0 |
Gains included in comprehensive income (loss) | 229 |
Investments and capital calls | 2,100 |
Distributions received | 0 |
Transfers into and out of Level 3 | 0 |
Balance at December 31, 2015 | $ 3,276 |
Investments - Summary of Compan
Investments - Summary of Company's Investment Securities (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2015 | Dec. 31, 2014 | |
Investment Securities [Line Items] | ||
Amortized Cost | $ 128,304 | $ 119,119 |
Gross Unrealized Gains | 4,710 | 6,648 |
Gross Unrealized Losses | (1,432) | (682) |
Fair Value | 131,582 | 125,085 |
Fixed Maturities | ||
Investment Securities [Line Items] | ||
Amortized Cost | 114,845 | 107,718 |
Gross Unrealized Gains | 4,367 | 5,978 |
Gross Unrealized Losses | (770) | (674) |
Fair Value | 118,442 | 113,022 |
Fixed Maturities | U.S. government and agencies | ||
Investment Securities [Line Items] | ||
Amortized Cost | 13,036 | 8,039 |
Gross Unrealized Gains | 162 | 277 |
Gross Unrealized Losses | (85) | (26) |
Fair Value | 13,113 | 8,290 |
Fixed Maturities | State | ||
Investment Securities [Line Items] | ||
Amortized Cost | 698 | 698 |
Gross Unrealized Gains | 4 | 27 |
Fair Value | 702 | 725 |
Fixed Maturities | Political subdivisions | ||
Investment Securities [Line Items] | ||
Amortized Cost | 4,354 | 500 |
Gross Unrealized Gains | 9 | 6 |
Fair Value | 4,363 | 506 |
Fixed Maturities | Revenue and assessment | ||
Investment Securities [Line Items] | ||
Amortized Cost | 11,770 | 14,856 |
Gross Unrealized Gains | 895 | 1,522 |
Gross Unrealized Losses | (21) | (18) |
Fair Value | 12,644 | 16,360 |
Fixed Maturities | Corporate bonds | ||
Investment Securities [Line Items] | ||
Amortized Cost | 79,426 | 73,051 |
Gross Unrealized Gains | 2,022 | 2,698 |
Gross Unrealized Losses | (663) | (630) |
Fair Value | 80,785 | 75,119 |
Fixed Maturities | Collateralized mortgage obligations: Agency Backed | ||
Investment Securities [Line Items] | ||
Amortized Cost | 793 | 4,647 |
Gross Unrealized Gains | 80 | 160 |
Fair Value | 873 | 4,807 |
Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - residential | ||
Investment Securities [Line Items] | ||
Amortized Cost | 2,877 | 3,513 |
Gross Unrealized Gains | 579 | 624 |
Gross Unrealized Losses | (1) | |
Fair Value | 3,455 | 4,137 |
Fixed Maturities | Collateralized mortgage obligations: Non-agency backed - commercial | ||
Investment Securities [Line Items] | ||
Amortized Cost | 1,891 | 2,414 |
Gross Unrealized Gains | 616 | 664 |
Fair Value | 2,507 | 3,078 |
Preferred stock, available-for-sale | ||
Investment Securities [Line Items] | ||
Amortized Cost | 1,500 | 1,500 |
Gross Unrealized Gains | 223 | 267 |
Fair Value | 1,723 | 1,767 |
Mutual funds, available-for-sale | ||
Investment Securities [Line Items] | ||
Amortized Cost | 11,959 | 9,901 |
Gross Unrealized Gains | 120 | 403 |
Gross Unrealized Losses | (662) | (8) |
Fair Value | $ 11,417 | $ 10,296 |
Investments - Scheduled Maturit
Investments - Scheduled Maturities of Company's Fixed Maturity Securities Based on their Fair Values (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Securities with Unrealized Losses, Total | $ 57,573 | $ 38,072 |
Fixed Maturities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Securities with Unrealized Gains, One year or less | 3,715 | |
Securities with Unrealized Gains, After one through five years | 17,383 | |
Securities with Unrealized Gains, After five through ten years | 31,952 | |
Securities with Unrealized Gains, After ten years | 8,467 | |
Securities with Unrealized Gains, No single maturity date | 6,641 | |
Securities with Unrealized Gains, Total | 68,158 | |
Securities with Unrealized Losses, One year or less | 1,036 | |
Securities with Unrealized Losses, After one through five years | 15,650 | |
Securities with Unrealized Losses, After five through ten years | 31,854 | |
Securities with Unrealized Losses, No single maturity date | 194 | |
Securities with Unrealized Losses, Total | 48,734 | |
Securities with No Unrealized Gains or Losses, One year or less | 1,550 | |
Securities with No Unrealized Gains or Losses, Total | 1,550 | |
All Fixed Maturity Securities, One year or less | 6,301 | |
All Fixed Maturity Securities, After one through five years | 33,033 | |
All Fixed Maturity Securities, After five through ten years | 63,806 | |
All Fixed Maturity Securities, After ten years | 8,467 | |
All Fixed Maturity Securities, No single maturity date | 6,835 | |
All Fixed Maturity Securities, Total | $ 118,442 |
Investments - Fair Value and Gr
Investments - Fair Value and Gross Unrealized Losses of Investments, Available-for-Sale, by the Length of Time (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | $ 49,884 | $ 17,505 |
Less than 12 months, Gross Unrealized Losses | (1,191) | (90) |
12 months or longer, Fair value | 7,689 | 20,567 |
12 months or longer, Gross Unrealized Losses | (241) | (592) |
Total Gross Unrealized Losses | (1,432) | (682) |
Total Fixed Maturities, Available-for-Sale | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 41,045 | 15,513 |
Less than 12 months, Gross Unrealized Losses | (529) | (82) |
12 months or longer, Fair value | 7,689 | 20,567 |
12 months or longer, Gross Unrealized Losses | (241) | (592) |
Total Gross Unrealized Losses | (770) | (674) |
U.S. Government and Agencies | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 8,946 | 5,012 |
Less than 12 months, Gross Unrealized Losses | (85) | (26) |
Total Gross Unrealized Losses | (85) | (26) |
Revenue and Assessment | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 1,733 | 2,820 |
Less than 12 months, Gross Unrealized Losses | (21) | (18) |
Total Gross Unrealized Losses | (21) | (18) |
Corporate Bonds | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 30,172 | 7,681 |
Less than 12 months, Gross Unrealized Losses | (422) | (38) |
12 months or longer, Fair value | 7,689 | 20,567 |
12 months or longer, Gross Unrealized Losses | (241) | (592) |
Total Gross Unrealized Losses | (663) | (630) |
Non-Agency Backed - Residential | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 5 | |
Less than 12 months, Gross Unrealized Losses | (1) | |
Total Gross Unrealized Losses | (1) | |
Collateralized mortgage obligations: Non-agency backed - commercial | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 189 | |
Mutual Fund, Available-for-Sale | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Less than 12 months, Fair value | 8,839 | 1,992 |
Less than 12 months, Gross Unrealized Losses | (662) | (8) |
Total Gross Unrealized Losses | $ (662) | $ (8) |
Investments - Number of Fixed M
Investments - Number of Fixed Maturity Securities with Gross Unrealized Gains and Losses (Detail) - Security | Dec. 31, 2015 | Dec. 31, 2014 |
Investments Debt And Equity Securities [Abstract] | ||
Number of Securities with Gross Unrealized Losses Less than or equal to 12 months | 21 | 9 |
Number of Securities with Gross Unrealized Losses Greater than 12 months | 4 | 9 |
Number of Securities with Gross Unrealized Gains | 70 | 80 |
Investments - Fair Value and 50
Investments - Fair Value and Gross Unrealized Losses of Fixed Maturity Securities in Continuous Unrealized Loss Position for Greater than 12 Months (Detail) $ in Thousands | Dec. 31, 2015USD ($)Security | Dec. 31, 2014USD ($)Security |
Schedule of Available-for-sale Securities [Line Items] | ||
Number of Securities | Security | 4 | 9 |
Fair Value | $ 7,689 | $ 20,567 |
Gross Unrealized Losses | $ (241) | $ (592) |
Percentage of amortized cost less than or equal to 10% | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Number of Securities | Security | 4 | 9 |
Fair Value | $ 7,689 | $ 20,567 |
Gross Unrealized Losses | $ (241) | $ (592) |
Investments - Gross Unrealized
Investments - Gross Unrealized Losses by Current Severity and Length of Time that Individual Securities have been in Continuous Unrealized Loss Position (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | $ 57,573 | $ 38,072 |
Gross Unrealized Losses | (1,432) | (682) |
Percentage of amortized cost less than 5% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (769) | (682) |
Percentage of amortized cost 5% to 10% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (662) | |
Percentage of amortized cost greater than 10% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (1) | |
Less than or equals to three months | ||
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | 20,899 | 17,505 |
Gross Unrealized Losses | (130) | (90) |
Less than or equals to three months | Percentage of amortized cost less than 5% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (130) | (90) |
Less than or equals to six months | ||
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | 7,036 | |
Gross Unrealized Losses | (465) | |
Less than or equals to six months | Percentage of amortized cost 5% to 10% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (465) | |
Less than or equals to nine months | ||
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | 14,057 | |
Gross Unrealized Losses | (395) | |
Less than or equals to nine months | Percentage of amortized cost less than 5% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (197) | |
Less than or equals to nine months | Percentage of amortized cost 5% to 10% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (197) | |
Less than or equals to nine months | Percentage of amortized cost greater than 10% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (1) | |
Less than or equals to twelve months | ||
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | 7,892 | |
Gross Unrealized Losses | (201) | |
Less than or equals to twelve months | Percentage of amortized cost less than 5% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | (201) | |
Greater than 12 months | ||
Investment Maturity Date [Line Items] | ||
Fair Value of Securities with Gross Unrealized Losses | 7,689 | 20,567 |
Gross Unrealized Losses | (241) | (592) |
Greater than 12 months | Percentage of amortized cost less than 5% | ||
Investment Maturity Date [Line Items] | ||
Gross Unrealized Losses | $ (241) | $ (592) |
Investments - Additional Inform
Investments - Additional Information (Detail) | 12 Months Ended | ||
Dec. 31, 2015USD ($)Fund | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | |
Schedule of Available-for-sale Securities [Line Items] | |||
Number of investment funds | Fund | 3 | ||
Unfunded commitments | $ 1,100,000 | ||
Incremental percentage of withdrawal of other investments | 25.00% | ||
Fixed maturities and cash equivalents on deposit with various insurance departments at fair value and amortized cost | $ 6,500,000 | ||
Cash equivalents on deposit with another insurance company at fair value and amortized cost | 9,400,000 | ||
OTTI charges recognized in net income (loss) | 0 | $ 0 | $ 61,000 |
Collateralized mortgage obligations: Non-agency backed - residential | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Non credit other than temporary impairment for securities | 900,000 | 900,000 | |
Collateralized mortgage obligations: Non-agency backed - commercial | |||
Schedule of Available-for-sale Securities [Line Items] | |||
Non credit other than temporary impairment for securities | $ 200,000 | $ 200,000 |
Investments - Major Categories
Investments - Major Categories of Investment Income (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Net Investment Income [Line Items] | |||
Investment expenses | $ (494) | $ (489) | $ (576) |
Net investment income | 5,024 | 5,123 | 5,716 |
Fixed Maturities | |||
Net Investment Income [Line Items] | |||
Gross investment income | 4,220 | 4,481 | 4,914 |
Mutual funds, available-for-sale | |||
Net Investment Income [Line Items] | |||
Gross investment income | 666 | 832 | 766 |
Other investments | |||
Net Investment Income [Line Items] | |||
Gross investment income | 396 | 85 | 399 |
Other | |||
Net Investment Income [Line Items] | |||
Gross investment income | $ 236 | $ 214 | $ 213 |
Investments - Components of Net
Investments - Components of Net Realized Gains (Losses) on Investments, Available-for-Sale at Fair Value (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Investments Debt And Equity Securities [Abstract] | |||
Gains | $ 15,000 | $ 85,000 | $ 100,000 |
Losses | (26,000) | (62,000) | (68,000) |
Other than temporary impairment | 0 | 0 | (61,000) |
Net realized gains (losses) on investments, available-for-sale | $ (11,000) | $ 23,000 | $ (29,000) |
Investments - Progression of Cr
Investments - Progression of Credit-Related Portion of OTTI on Investments (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Investments Debt And Equity Securities [Abstract] | |||
Beginning balance | $ (2,632) | $ (2,632) | $ (2,666) |
Additional credit impairments on: | |||
Previously impaired securities | 0 | 0 | (61) |
Securities without previous impairments | 0 | 0 | 0 |
Total additional credit impairments securities | 0 | 0 | (61) |
Reductions for securities deemed worthless (realized) | 0 | 0 | 95 |
Ending balance | $ (2,632) | $ (2,632) | $ (2,632) |
Reinsurance - Effects of Reinsu
Reinsurance - Effects of Reinsurance Premium Written and Earned (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Direct Written | $ 247,498 | $ 200,983 | $ 177,376 |
Assumed Written | 35,500 | 29,311 | 23,768 |
Ceded Written | (372) | (265) | (201) |
Written Total | 282,626 | 230,029 | 200,943 |
Direct Earned | 233,652 | 191,093 | 176,588 |
Assumed Earned | 33,707 | 27,487 | 23,313 |
Ceded Earned | (372) | (265) | (201) |
Earned Total | $ 266,987 | $ 218,315 | $ 199,700 |
Reinsurance - Additional Inform
Reinsurance - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Percentage of quota-share reinsurance | 100.00% | ||
Percentages of premiums | 13.00% | 13.00% | 12.00% |
Unsecured aggregate reinsurance receivables | $ 0.5 |
Reinsurance - Ceded Premiums Ea
Reinsurance - Ceded Premiums Earned and Reinsurance Recoveries on Losses and Loss Adjustment Expenses (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Ceded premiums earned | $ 372 | $ 265 | $ 201 |
Reinsurance recoveries on losses and loss adjustment expenses | $ 239 | $ 137 | $ 285 |
Stock-Based Compensation Plan59
Stock-Based Compensation Plans - Additional Information (Detail) | Mar. 10, 2015$ / sharesshares | Jan. 31, 2012USD ($)Employee$ / sharesshares | Dec. 31, 2015USD ($)shares | Dec. 31, 2014USD ($)shares | Dec. 31, 2013USD ($)shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Remaining available shares for issuance under the plan | 6,141,970 | ||||
Stock Option Awards expiry range | 5 years | ||||
Vest in designated installments over | 4 years | ||||
Stock Option Awards to purchase shares of the company's common stock | Employee | 2 | ||||
Stock Option Awards granted | 0 | 0 | |||
Exercise price / Closing market price per share of common stock | $ / shares | $ 1.45 | ||||
Stock Option Awards expiration date | Jan. 31, 2017 | ||||
Compensation expense related to Stock Option | $ | $ 522,000 | ||||
Compensation expense related to Stock Option amortized | $ | 521,000 | ||||
Remaining Compensation expense amortized in January 2016 | $ | $ 1,000 | ||||
Fair value of Stock Option Awards with expected volatility | 73.00% | ||||
Risk-free interest rate | 0.71% | ||||
Dividend yield rate | 0.00% | ||||
Expected term | 5 years | ||||
Value of options granted per share | $ / shares | $ 0.63 | ||||
Risk-free interest rate, duration | 5 years | ||||
Weighted average remaining contractual life of options outstanding | 1 year 4 months 24 days | ||||
Exercisable/vested | 1 year 4 months 24 days | ||||
Compensation expense to purchase shares under the ESPP | $ | $ 144,000 | $ 185,000 | $ 243,000 | ||
Employee Stock Purchase Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Percentage of authorize payroll deductions | 15.00% | ||||
Maximum Amount of outstanding stock to be subscribed | $ | $ 25,000 | ||||
Company reserved shares of common stock for issuance under the ESPP | 400,000 | ||||
Employees purchase shares | 37,000 | 31,000 | 35,000 | ||
Compensation expense to purchase shares under the ESPP | $ | $ 12,000 | $ 11,000 | $ 7,000 | ||
Shares remain available for issuance under the ESPP | 50,565 | ||||
Executive Officer One | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock Option Awards granted | 750,000 | ||||
Vesting percent of shares | 40.00% | ||||
Remainder vesting in equal installments | 3 years | ||||
Executive Officer Two | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock Option Awards granted | 75,000 | ||||
Vesting percent of shares | 20.00% | ||||
Remainder vesting in equal installments | 4 years | ||||
Employee Stock Options | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Stock Option Awards expiry range | 10 years | ||||
Vest in designated installments over | 5 years | ||||
Restricted stock | Executive Officer | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Exercise price / Closing market price per share of common stock | $ / shares | $ 2.44 | ||||
Compensation awarded restricted stock units | 141,000 |
Stock-Based Compensation Plan60
Stock-Based Compensation Plans - Summary of the Activity for the Company's Stock Option Awards (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options outstanding, Options, Beginning Balance | 1,120 | 1,237 | 1,595 |
Forfeited, Options | (35) | (117) | (358) |
Options outstanding, Options, Ending Balance | 1,085 | 1,120 | 1,237 |
Options exercisable/vested at December 31, 2015 | 1,070 | ||
Forfeited, Exercise Price | $ 3.04 | $ 5.22 | $ 3.04 |
Options outstanding, Weighted Average Exercise Price, Beginning Balance | 1.87 | 2.19 | 2.38 |
Forfeited, Weighted Average Exercise Price | 3.04 | 5.22 | 3.04 |
Options outstanding, Weighted Average Exercise Price, Ending Balance | 1.83 | 1.87 | 2.19 |
Options exercisable/vested at December 31, 2015, Weighted Average Exercise Price | $ 1.84 | ||
Options outstanding, Aggregated Intrinsic Value, Ending balance | $ 767 | ||
Options exercisable/vested at December 31, 2015, Aggregated Intrinsic Value | $ 753 | ||
Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding, Exercise Price, Beginning Balance | $ 1.45 | 1.45 | 1.45 |
Options Outstanding, Exercise Price, Ending Balance | 1.45 | 1.45 | 1.45 |
Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Options Outstanding, Exercise Price, Beginning Balance | 3.04 | 8.13 | 8.13 |
Options Outstanding, Exercise Price, Ending Balance | $ 3.04 | $ 3.04 | $ 8.13 |
Employee Benefit Plan - Additio
Employee Benefit Plan - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Schedule Of Sale Of Subsidiary [Abstract] | |||
Defined contribution plan employer matching contribution percent for three percent of employee contribution | 100.00% | ||
Initial employee salary percentage with full employer contribution | 3.00% | ||
Defined contribution plan employer matching contribution percent for two percent of employee contribution | 50.00% | ||
Additional employee salary percentage with partly employer contribution | 2.00% | ||
Company's contributions to Plan | $ 1 | $ 0.7 | $ 0.6 |
Property and Equipment - Compon
Property and Equipment - Components of Property and Equipment (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 19,757 | $ 16,088 |
Less: Accumulated depreciation | (14,616) | (12,915) |
Property and equipment, net | 5,141 | 3,173 |
Furniture and Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 12,878 | 10,660 |
Leasehold Improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 6,451 | 5,000 |
Capitalized Leases | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | 238 | 238 |
Aircraft | ||
Property, Plant and Equipment [Line Items] | ||
Property and equipment, gross | $ 190 | $ 190 |
Property and Equipment - Additi
Property and Equipment - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Property Plant And Equipment Useful Life And Values [Abstract] | |||
Depreciation expense | $ 1,751 | $ 1,767 | $ 2,053 |
Capitalized assets | $ 200 |
Lease Commitments - Additional
Lease Commitments - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Leases [Abstract] | |||
Rental expense | $ 11.2 | $ 8.9 | $ 9.2 |
Lease Commitments - Summary of
Lease Commitments - Summary of Future Minimum Lease Payments (Detail) $ in Thousands | Dec. 31, 2015USD ($) |
Leases [Abstract] | |
2,016 | $ 7,079 |
2,017 | 3,991 |
2,018 | 2,027 |
2,019 | 924 |
2,020 | 631 |
Thereafter | 1,483 |
Total | $ 16,135 |
Losses and Loss Adjustment Ex66
Losses and Loss Adjustment Expenses Incurred and Paid - Information Regarding the Reserve for Unpaid Losses and Loss Adjustment Expenses (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Liability for unpaid losses and LAE at beginning of year, gross | $ 96,613 | $ 84,286 | $ 79,260 |
Reinsurance balances receivable, beginning balance | (362) | (305) | (260) |
Liability for unpaid losses and LAE at beginning of year, net | 96,251 | 83,981 | 79,000 |
Add: Provision for lossses and LAE: | |||
Current year | 218,186 | 166,185 | 145,877 |
Prior year | 845 | (4,883) | (3,038) |
Net losses and LAE incurred | 219,031 | 161,302 | 142,839 |
Less: Losses and LAE paid: | |||
Current year | 129,216 | 98,442 | 88,726 |
Prior year | 64,459 | 50,590 | 49,132 |
Net losses and LAE paid | 193,675 | 149,032 | 137,858 |
Liability for unpaid losses and LAE at end of year, net | 121,607 | 96,251 | 83,981 |
Reinsurance balances receivable, ending balance | 464 | 362 | 305 |
Liability for unpaid losses and LAE at end of year, gross | $ 122,071 | $ 96,613 | $ 84,286 |
Losses and Loss Adjustment Ex67
Losses and Loss Adjustment Expenses Incurred and Paid - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Unpaid losses and loss adjustment expenses | $ (845) | $ 4,883 | $ 3,038 |
Debentures Payable and Term L68
Debentures Payable and Term Loan From Principal Stockholder - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Jun. 30, 2007 | Apr. 30, 2016 | Dec. 31, 2015 | Jun. 29, 2015 | Jul. 30, 2012 |
Debt Instrument [Line Items] | |||||
Preferred stock shares issued by unconsolidated trust | 40,000 | ||||
Common stock shares issued by unconsolidated trust | 1,240 | ||||
Price of preferred and common shares issued by unconsolidated trust | $ 1,000 | ||||
Period for deferral of preferred securities dividend | 5 years | ||||
Unamortized debt discount and issuance costs | $ 1 | ||||
Junior Subordinated Debentures | |||||
Debt Instrument [Line Items] | |||||
Debentures paid fixed rate | 9.277% | ||||
Variable rate | Three-Month LIBOR plus 375 basis points | ||||
Variable rate basis point | 3.75% | ||||
Proceeds to unconsolidated trust from issuance of junior subordinated debenture sale of preferred stock shares | $ 41.2 | ||||
Maturity date | Jul. 30, 2037 | ||||
Junior Subordinated Debentures | Scenario Forecast | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.366% | ||||
Junior Subordinated Debentures | Minimum | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 3.983% | ||||
Junior Subordinated Debentures | Maximum | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 4.072% | ||||
Senior Term Loan Facility | Diamond Family Investments L P | Loan Agreement | |||||
Debt Instrument [Line Items] | |||||
Maturity date | Jun. 29, 2025 | ||||
Term loan borrowed | $ 30 | $ 30 | |||
Term loan outstanding, interest rate | 8.00% | ||||
Net of unamortized loan issuance costs | $ 0.2 |
Income Taxes - Provision (Benef
Income Taxes - Provision (Benefit) for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Federal: | |||
Current | $ 20 | $ 228 | $ 175 |
Deferred | (893) | (19,098) | (4) |
Gross Federal | (873) | (18,870) | 171 |
State: | |||
Current | 255 | 650 | 476 |
Deferred | (24) | (125) | 3 |
Gross State | 231 | 525 | 479 |
Income tax expense (benefit) | $ (642) | $ (18,345) | $ 650 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Taxes [Line Items] | |||
Statutory federal corporate tax rate | 35.00% | ||
Valuation allowance | $ 1,746 | $ 1,763 | |
Change in the total valuation allowance | 22,400 | $ 4,300 | |
Change in the valuation allowance related to unrealized change in investments | 1,200 | ||
Utilization of valuation allowance associated with net operating loss carry forwards | 9,800 | 8,600 | |
Change in valuation allowance of income tax | $ 1,900 | ||
AMT credit carryforwards | 2,015 | $ 2,004 | |
Domestic Country | |||
Income Taxes [Line Items] | |||
Gross Federal NOL carryforwards | $ 19,600 | ||
NOL carryforwards expire date | 2,031 | ||
State And Local Jurisdiction | |||
Income Taxes [Line Items] | |||
Gross Federal NOL carryforwards | $ 8,500 | ||
NOL carryforwards expire date | 2,020 |
Income Taxes - Provision (Ben71
Income Taxes - Provision (Benefit) for Income Taxes Differs from Amounts Computed by Applying Statutory Federal Corporate Tax Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Income Tax Disclosure [Abstract] | |||
Provision (benefit) for income taxes at statutory rate | $ (900) | $ 3,403 | $ 3,440 |
Tax effect of: | |||
Tax-exempt investment income | (22) | (21) | (27) |
Change in the beginning of the period balance of the valuation allowance for deferred tax assets allocated to federal income taxes | 9 | (22,427) | (4,277) |
Stock-based compensation | 22 | 137 | 1,133 |
State income taxes, net of federal income tax benefit and state valuation allowance | 142 | 525 | 479 |
Permanent items | 107 | 38 | (98) |
Income tax expense (benefit) | $ (642) | $ (18,345) | $ 650 |
Income Taxes - Summary of Net D
Income Taxes - Summary of Net Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 6,859 | $ 6,180 |
Stock-based compensation | 421 | 402 |
Unearned premiums and loss and loss adjustment expense reserves | 6,797 | 5,614 |
Goodwill and identifiable intangible assets | 4,252 | 5,404 |
Alternative minimum tax (“AMT”) credit carryforwards | 2,015 | 2,004 |
Accrued expenses and other nondeductible items | 1,551 | 1,201 |
Other | 3,528 | 3,127 |
Deferred Tax Assets, Gross, Total | 25,423 | 23,932 |
Deferred tax liabilities: | ||
Deferred acquisition costs | (1,928) | (1,211) |
Identifiable intangible assets | (1,872) | (1,872) |
Net unrealized change on investments | (1,244) | (2,105) |
Other | (332) | (460) |
Deferred tax liabilities, gross | (5,376) | (5,648) |
Total net deferred tax asset | 20,047 | 18,284 |
Less: Valuation allowance | (1,746) | (1,763) |
Net deferred tax asset | $ 18,301 | $ 16,521 |
Net Income (Loss) Per Share - C
Net Income (Loss) Per Share - Computation of Basic and Diluted Net Income (Loss) Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Abstract] | |||||||||||
Net income (loss) | $ 287 | $ (3,018) | $ 315 | $ 486 | $ 21,968 | $ 2,120 | $ 3,469 | $ 511 | $ (1,930) | $ 28,068 | $ 9,180 |
Weighted average common basic shares | 41,030 | 40,985 | 40,930 | ||||||||
Effect of dilutive securities | 298 | 162 | |||||||||
Weighted average common dilutive shares | 41,030 | 41,283 | 41,092 | ||||||||
Basic and diluted net income (loss) per share | $ (0.07) | $ 0.01 | $ 0.01 | $ 0.54 | $ 0.05 | $ 0.08 | $ 0.01 | $ (0.05) | $ 0.68 | $ 0.22 |
Net Income (Loss) Per Share - A
Net Income (Loss) Per Share - Additional Information (Detail) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Earnings Per Share [Line Items] | |||
Exercisable options outstanding that enable to purchase shares | 825 | 800 | 900 |
Restricted stock | |||
Earnings Per Share [Line Items] | |||
Exercisable options outstanding that enable to purchase shares | 141 | ||
Shares with dilutive effect and included in computation of diluted income (loss) per share | 26 | 17 | |
Equity option | |||
Earnings Per Share [Line Items] | |||
Shares with dilutive effect and included in computation of diluted income (loss) per share | 319 | 298 | 145 |
Options excluded from computation of diluted income (loss) per share due to anti-dilutive effect | 260 | 295 | 412 |
Concentrations of Credit Risk -
Concentrations of Credit Risk - Additional Information (Detail) $ in Millions | Dec. 31, 2015USD ($) |
Risks And Uncertainties [Abstract] | |
Cash and cash equivalents | $ 115.6 |
Litigation - Additional Informa
Litigation - Additional Information (Detail) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Sep. 30, 2015 | Dec. 31, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | ||
Litigation settlement, amount | $ 3.4 | $ 3.2 |
Segment Information - Additiona
Segment Information - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2015Segment | |
Segment Reporting [Abstract] | |
Number of business segments | 2 |
Segment Information - Selected
Segment Information - Selected Financial Data by Business Segment (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Segment Reporting Information [Line Items] | |||||||||||
Revenues | $ 88,536 | $ 87,620 | $ 80,631 | $ 75,105 | $ 67,928 | $ 65,604 | $ 67,120 | $ 62,542 | $ 331,892 | $ 263,194 | $ 240,512 |
Income (loss) before income taxes | 458 | $ (4,524) | $ 690 | $ 804 | 3,076 | $ 2,377 | $ 3,723 | $ 547 | (2,572) | 9,723 | 9,830 |
Total assets | 402,127 | 328,445 | 402,127 | 328,445 | |||||||
Insurance | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 331,828 | 263,133 | 240,460 | ||||||||
Income (loss) before income taxes | 338 | 12,549 | 12,748 | ||||||||
Total assets | 373,475 | 302,529 | 373,475 | 302,529 | |||||||
Real estate and Corporate | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Revenues | 64 | 61 | 52 | ||||||||
Income (loss) before income taxes | (2,910) | (2,826) | $ (2,918) | ||||||||
Total assets | $ 28,652 | $ 25,916 | $ 28,652 | $ 25,916 |
Statutory Financial Informati79
Statutory Financial Information and Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | ||
Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Insurance [Abstract] | |||
Capital and surplus of the Insurance Companies | $ 98,800,000 | $ 96,600,000 | |
Statutory net income (loss) of the Insurance Companies | $ (7,300,000) | $ 1,000,000 | $ 4,200,000 |
Maximum dividends to be paid as a percentage of statutory capital and surplus without the prior approval of the Texas insurance commissioner | 10.00% | ||
Ordinary dividends received | $ 0 |
Business Combinations - Additio
Business Combinations - Additional Information (Detail) $ in Thousands | Jul. 01, 2015USD ($)Stores | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | Jun. 30, 2014USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Dec. 31, 2013USD ($) | Jun. 29, 2015USD ($) |
Business Acquisition [Line Items] | |||||||||||||
Amortization of identifiable intangibles assets | $ 514 | ||||||||||||
Revenues | $ 88,536 | $ 87,620 | $ 80,631 | $ 75,105 | $ 67,928 | $ 65,604 | $ 67,120 | $ 62,542 | $ 331,892 | $ 263,194 | $ 240,512 | ||
Titan Acquisition | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Amortization recorded on accelerated basis | 7 years 6 months | ||||||||||||
Amortization of identifiable intangibles assets | $ 500 | ||||||||||||
Estimate of expected liability | 2,277 | 2,277 | |||||||||||
Reduction in goodwill | 800 | ||||||||||||
Acquisition related costs | 100 | ||||||||||||
Integration related costs | 1,500 | ||||||||||||
Revenues | 12,600 | ||||||||||||
Income before tax benefit | 200 | ||||||||||||
Titan Acquisition | Asset Purchase Agreement | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Business acquisition, effective date of completion | Jul. 1, 2015 | ||||||||||||
Payments to acquire businesses, gross | $ 36,000 | ||||||||||||
Number of retail stores | Stores | 83 | ||||||||||||
Business combination, liabilities assumed | $ 2,300 | ||||||||||||
Diamond Family Investments L P | Senior Term Loan Facility | Loan Agreement | |||||||||||||
Business Acquisition [Line Items] | |||||||||||||
Term loan borrowed | $ 30,000 | $ 30,000 | $ 30,000 |
Business Combinations - Summary
Business Combinations - Summary of Estimated Fair Value of Asset Acquired at the Date of Acquisition (Detail) $ in Thousands | 12 Months Ended |
Dec. 31, 2015USD ($) | |
Business Acquisition [Line Items] | |
Goodwill | $ 29,429 |
Total cash paid | 33,770 |
Titan Acquisition | |
Business Acquisition [Line Items] | |
Tangible assets | 1,847 |
Identifiable intangible asset | 4,000 |
Goodwill | 30,200 |
Total assets acquired | 36,047 |
Less: liabilities assumed | (2,277) |
Total cash paid | $ 33,770 |
Business Combinations - Busines
Business Combinations - Business Combination Pro Forma Information (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Jun. 30, 2015 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | ||
Revenues: | |||||||||||||
Premiums earned | $ 266,987 | $ 218,315 | $ 199,700 | ||||||||||
Commission and fee income | 59,892 | 39,733 | 35,125 | ||||||||||
Investment income | 5,024 | 5,123 | 5,716 | ||||||||||
Net realized gains (losses) on investments, available-for-sale | (11) | 23 | (29) | ||||||||||
Total revenues | $ 88,536 | $ 87,620 | $ 80,631 | $ 75,105 | $ 67,928 | $ 65,604 | $ 67,120 | $ 62,542 | 331,892 | 263,194 | 240,512 | ||
Costs and expenses: | |||||||||||||
Losses and loss adjustment expenses | 219,031 | 161,302 | 142,839 | ||||||||||
Insurance operating expenses | 105,254 | 87,328 | 82,822 | ||||||||||
Other operating expenses | 1,126 | 996 | 987 | ||||||||||
Litigation settlement | 3,677 | 187 | |||||||||||
Stock-based compensation | 144 | 185 | 243 | ||||||||||
Depreciation | 1,751 | 1,767 | 2,053 | ||||||||||
Amortization of identifiable intangible assets | 514 | ||||||||||||
Interest expense | 2,967 | 1,706 | 1,738 | ||||||||||
Total costs and expenses | 334,464 | 253,471 | 230,682 | ||||||||||
Income (loss) before income taxes | 458 | (4,524) | 690 | 804 | 3,076 | 2,377 | 3,723 | 547 | (2,572) | 9,723 | 9,830 | ||
Provision (benefit) for income taxes | (642) | (18,345) | 650 | ||||||||||
Net income (loss) | $ 287 | $ (3,018) | $ 315 | $ 486 | $ 21,968 | $ 2,120 | $ 3,469 | $ 511 | $ (1,930) | $ 28,068 | $ 9,180 | ||
Net income (loss) per share: | |||||||||||||
Basic | $ (0.05) | $ 0.68 | $ 0.22 | ||||||||||
Diluted | $ (0.05) | $ 0.68 | $ 0.22 | ||||||||||
Number of shares used to calculate net income (loss) per share: | |||||||||||||
Basic | 41,030 | 40,985 | 40,930 | ||||||||||
Diluted | 41,030 | 41,283 | 41,092 | ||||||||||
Titan Agencies Historical | |||||||||||||
Revenues: | |||||||||||||
Commission and fee income | $ 14,547 | $ 28,222 | |||||||||||
Total revenues | 14,547 | 28,222 | |||||||||||
Costs and expenses: | |||||||||||||
Insurance operating expenses | 14,555 | 27,325 | |||||||||||
Total costs and expenses | 14,555 | 27,325 | |||||||||||
Income (loss) before income taxes | (8) | 897 | |||||||||||
Provision (benefit) for income taxes | (3) | 359 | |||||||||||
Net income (loss) | $ (5) | 538 | |||||||||||
Pro Forma Adjustments | |||||||||||||
Costs and expenses: | |||||||||||||
Insurance operating expenses | [1] | $ (81) | |||||||||||
Depreciation | [2] | 50 | 100 | ||||||||||
Amortization of identifiable intangible assets | [3] | 320 | 942 | ||||||||||
Interest expense | [4] | 1,190 | 2,426 | ||||||||||
Total costs and expenses | 1,479 | 3,468 | |||||||||||
Income (loss) before income taxes | (1,479) | (3,468) | |||||||||||
Provision (benefit) for income taxes | [5] | (592) | (1,387) | ||||||||||
Net income (loss) | (887) | (2,081) | |||||||||||
Pro Forma Combined | |||||||||||||
Revenues: | |||||||||||||
Premiums earned | 266,987 | 218,315 | |||||||||||
Commission and fee income | 74,439 | 67,955 | |||||||||||
Investment income | 5,024 | 5,123 | |||||||||||
Net realized gains (losses) on investments, available-for-sale | (11) | 23 | |||||||||||
Total revenues | 346,439 | 291,416 | |||||||||||
Costs and expenses: | |||||||||||||
Losses and loss adjustment expenses | 219,031 | 161,302 | |||||||||||
Insurance operating expenses | 119,728 | 114,653 | |||||||||||
Other operating expenses | 1,126 | 996 | |||||||||||
Litigation settlement | 3,677 | 187 | |||||||||||
Stock-based compensation | 144 | 185 | |||||||||||
Depreciation | 1,801 | 1,867 | |||||||||||
Amortization of identifiable intangible assets | 834 | 942 | |||||||||||
Interest expense | 4,157 | 4,132 | |||||||||||
Total costs and expenses | 350,498 | 284,264 | |||||||||||
Income (loss) before income taxes | (4,059) | 7,152 | |||||||||||
Provision (benefit) for income taxes | (1,237) | (19,373) | |||||||||||
Net income (loss) | $ (2,822) | $ 26,525 | |||||||||||
Net income (loss) per share: | |||||||||||||
Basic | $ (0.07) | $ 0.65 | |||||||||||
Diluted | $ (0.07) | $ 0.64 | |||||||||||
Number of shares used to calculate net income (loss) per share: | |||||||||||||
Basic | 41,030 | 40,985 | |||||||||||
Diluted | 41,030 | 41,283 | |||||||||||
[1] | Elimination of acquisition costs incurred | ||||||||||||
[2] | Depreciation expense related to acquired tangible asset | ||||||||||||
[3] | Amortization expense related to acquired identifiable intangible asset | ||||||||||||
[4] | Interest expense related to acquisition financing (including amortization of issuance costs) | ||||||||||||
[5] | Calculated income tax effect of pro forma adjustments at the estimated combined federal and state statutory rate of 40% |
Business Combinations - Busin83
Business Combinations - Business Combination Pro Forma Information (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2015 | |
Business Combinations [Abstract] | |
Business acquisition, pro forma adjustments estimated combined federal and state statutory tax rate | 40.00% |
Selected Quarterly Financial 84
Selected Quarterly Financial Data (Unaudited) - Selected Quarterly Financial Data (Detail) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Total Revenues | $ 88,536 | $ 87,620 | $ 80,631 | $ 75,105 | $ 67,928 | $ 65,604 | $ 67,120 | $ 62,542 | $ 331,892 | $ 263,194 | $ 240,512 |
Income (Loss) Before Income Taxes | 458 | (4,524) | 690 | 804 | 3,076 | 2,377 | 3,723 | 547 | (2,572) | 9,723 | 9,830 |
Net income (loss) | $ 287 | $ (3,018) | $ 315 | $ 486 | $ 21,968 | $ 2,120 | $ 3,469 | $ 511 | $ (1,930) | $ 28,068 | $ 9,180 |
Basic and Diluted Net Income (Loss) Per Share | $ (0.07) | $ 0.01 | $ 0.01 | $ 0.54 | $ 0.05 | $ 0.08 | $ 0.01 | $ (0.05) | $ 0.68 | $ 0.22 |
Selected Quarterly Financial 85
Selected Quarterly Financial Data (Unaudited) - Additional Information (Detail) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Litigation settlement, amount | $ 3,400 | $ 3,200 | |||||||||
Net income (loss) | $ 287 | $ (3,018) | $ 315 | $ 486 | $ 21,968 | $ 2,120 | $ 3,469 | $ 511 | $ (1,930) | $ 28,068 | $ 9,180 |
Benefit for income taxes from change in deferred tax valuation allowance | $ 20,200 |
Financial Information of Regi86
Financial Information of Registrant (Parent Company) (Detail) - USD ($) $ in Thousands | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 |
ASSETS | ||||
Cash and cash equivalents | $ 115,587 | $ 102,429 | $ 72,033 | $ 59,104 |
Deferred tax asset | 18,301 | 16,521 | ||
Other assets | 6,950 | 5,962 | ||
TOTAL ASSETS | 402,127 | 328,445 | ||
Liabilities: | ||||
Debentures payable | 40,256 | 40,211 | ||
Term loan from principal stockholder | 29,753 | |||
Other liabilities | 15,606 | 13,453 | ||
Stockholders' equity | 103,670 | 106,964 | 76,932 | 72,793 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | 402,127 | 328,445 | ||
Parent Company | ||||
ASSETS | ||||
Investment in subsidiaries, at equity in net assets | 132,430 | 126,494 | ||
Cash and cash equivalents | 8,095 | 15,836 | $ 8,578 | $ 3,344 |
Loan to wholly-owned subsidiary | 30,010 | |||
Deferred tax asset | 8,649 | 7,965 | ||
Other assets | 2,142 | 2,144 | ||
TOTAL ASSETS | 181,326 | 152,439 | ||
Liabilities: | ||||
Debentures payable | 40,256 | 40,211 | ||
Term loan from principal stockholder | 29,753 | |||
Other liabilities | 7,647 | 5,264 | ||
Stockholders' equity | 103,670 | 106,964 | ||
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY | $ 181,326 | $ 152,439 |
Financial Information of Regi87
Financial Information of Registrant (Parent Company) (Detail 1) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Statement of Operations | |||||||||||
Interest income | $ 5,024 | $ 5,123 | $ 5,716 | ||||||||
Equity in income (loss) of subsidiaries, net of tax | 396 | 85 | 399 | ||||||||
Income (loss) before income taxes | $ 458 | $ (4,524) | $ 690 | $ 804 | $ 3,076 | $ 2,377 | $ 3,723 | $ 547 | (2,572) | 9,723 | 9,830 |
Benefit for income taxes | (642) | (18,345) | 650 | ||||||||
Net income (loss) | $ 287 | $ (3,018) | $ 315 | $ 486 | $ 21,968 | $ 2,120 | $ 3,469 | $ 511 | (1,930) | 28,068 | 9,180 |
Parent Company | |||||||||||
Statement of Operations | |||||||||||
Interest income | 1,328 | 61 | 52 | ||||||||
Equity in income (loss) of subsidiaries, net of tax | (441) | 23,804 | 11,657 | ||||||||
Expenses | (4,238) | (2,887) | (2,529) | ||||||||
Income (loss) before income taxes | (3,351) | 20,978 | 9,180 | ||||||||
Benefit for income taxes | (1,421) | (7,090) | |||||||||
Net income (loss) | $ (1,930) | $ 28,068 | $ 9,180 |
Financial Information of Regi88
Financial Information of Registrant (Parent Company) (Detail 2) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2014 | Sep. 30, 2014 | Jun. 30, 2014 | Mar. 31, 2014 | Dec. 31, 2015 | Dec. 31, 2014 | Dec. 31, 2013 | |
Cash flows from operating activities: | |||||||||||
Net income (loss) | $ 287,000 | $ (3,018,000) | $ 315,000 | $ 486,000 | $ 21,968,000 | $ 2,120,000 | $ 3,469,000 | $ 511,000 | $ (1,930,000) | $ 28,068,000 | $ 9,180,000 |
Equity in (income) loss of subsidiaries, net of tax | (396,000) | (85,000) | (399,000) | ||||||||
Stock-based compensation | 144,000 | 185,000 | 243,000 | ||||||||
Deferred income taxes | (917,000) | (19,223,000) | (1,000) | ||||||||
Other | 261,000 | 224,000 | 279,000 | ||||||||
Net cash provided by operating activities | 29,307,000 | 27,009,000 | 17,755,000 | ||||||||
Cash flows from investing activities: | |||||||||||
Dividends from subsidiary | 0 | ||||||||||
Net cash (used in) provided by investing activities | (46,240,000) | 3,313,000 | (4,877,000) | ||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from term loan from principal stockholder | 30,000,000 | ||||||||||
Net proceeds from issuance of common stock | 91,000 | 74,000 | 51,000 | ||||||||
Net cash provided by financing activities | 30,091,000 | 74,000 | 51,000 | ||||||||
Net change in cash and cash equivalents | 13,158,000 | 30,396,000 | 12,929,000 | ||||||||
Cash and cash equivalents, beginning of period | 102,429,000 | 72,033,000 | 102,429,000 | 72,033,000 | 59,104,000 | ||||||
Cash and cash equivalents, end of period | 115,587,000 | 102,429,000 | 115,587,000 | 102,429,000 | 72,033,000 | ||||||
Parent Company | |||||||||||
Cash flows from operating activities: | |||||||||||
Net income (loss) | (1,930,000) | 28,068,000 | 9,180,000 | ||||||||
Equity in (income) loss of subsidiaries, net of tax | 441,000 | (23,804,000) | (11,657,000) | ||||||||
Stock-based compensation | 144,000 | 185,000 | 243,000 | ||||||||
Deferred income taxes | (684,000) | (7,871,000) | (2,000) | ||||||||
Other | (203,000) | 28,000 | (6,000) | ||||||||
Change in assets and liabilities | 2,385,000 | 3,197,000 | 790,000 | ||||||||
Net cash provided by operating activities | 153,000 | (197,000) | (1,452,000) | ||||||||
Cash flows from investing activities: | |||||||||||
Dividends from subsidiary | 2,025,000 | 7,425,000 | 6,635,000 | ||||||||
Loan to wholly-owned subsidiary | (30,010,000) | ||||||||||
Investments in subsidiaries | (10,000,000) | (44,000) | |||||||||
Net cash (used in) provided by investing activities | (37,985,000) | 7,381,000 | 6,635,000 | ||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from term loan from principal stockholder | 30,000,000 | ||||||||||
Net proceeds from issuance of common stock | 91,000 | 74,000 | 51,000 | ||||||||
Net cash provided by financing activities | 30,091,000 | 74,000 | 51,000 | ||||||||
Net change in cash and cash equivalents | (7,741,000) | 7,258,000 | 5,234,000 | ||||||||
Cash and cash equivalents, beginning of period | $ 15,836,000 | $ 8,578,000 | 15,836,000 | 8,578,000 | 3,344,000 | ||||||
Cash and cash equivalents, end of period | $ 8,095,000 | $ 15,836,000 | $ 8,095,000 | $ 15,836,000 | $ 8,578,000 |