Document & Entity Information
Document & Entity Information - shares | 3 Months Ended | |
Mar. 31, 2020 | May 01, 2020 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2020 | |
Trading Symbol | UIHC | |
Title of 12(b) Security | Common Stock, $0.0001 par value per share | |
Security Exchange Name | NASDAQ | |
Registrant Name | United Insurance Holdings Corp. | |
Central Index Key | 0001401521 | |
Current Fiscal Year End Date | --12-31 | |
Filer Category | Accelerated Filer | |
Common Stock, Shares, Outstanding | 42,983,371 | |
Document Period End Date | Mar. 31, 2020 | |
Entity Emerging Growth Company | false | |
Entity Interactive Data Current | Yes | |
Entity Shell Company | false | |
Entity Small Business | false | |
Entity Current Reporting Status | Yes |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Investments, at fair value: | ||
Fixed maturities (amortized cost of $862,565 and $869,598) | $ 873,786 | $ 884,861 |
Available-for-sale Securities, Equity Securities | 111,915 | 116,610 |
Total investments | 995,266 | 1,011,723 |
Other investments (amortized cost of $9,336 and $8,067) | 9,565 | 10,252 |
Cash and Cash Equivalents | 218,355 | 215,469 |
Restricted Cash | 64,058 | 71,588 |
Restricted Cash and Cash Equivalents | 282,413 | 287,057 |
Accrued Investment Income | 5,478 | 5,901 |
Property and equipment, net | 34,955 | 32,728 |
Premiums receivable, net (credit allowance of $126 and $165) | 90,547 | 86,568 |
Reinsurance Recoverable for Paid and Unpaid Claims and Claims Adjustments (credit allowance of $241 and $265) | 514,485 | 550,136 |
Ceded uneared premiums | 179,513 | 270,034 |
Goodwill | 73,045 | 73,045 |
Deferred policy acquisition costs | 104,882 | 104,572 |
Intangible Assets, Net (Excluding Goodwill) | 24,941 | 26,079 |
Other assets, net (credit allowance of $112 and $141) | 26,234 | 19,375 |
Total Assets | 2,331,759 | 2,467,218 |
Liabilities | ||
Unpaid losses and loss adjustment expenses | 711,042 | 760,357 |
Unearned Premiums | 664,619 | 674,055 |
Reinsurance Payable | 112,390 | 166,131 |
Payments outstanding | 45,029 | 57,555 |
Accounts Payable | 70,506 | 78,592 |
Operating Lease, Liability | 2,421 | 324 |
Other Liabilities | 60,959 | 47,407 |
Notes Payable | 158,636 | 158,932 |
Total Liabilities | 1,825,602 | 1,943,353 |
Commitments and Contingencies | ||
Stockholders' Equity | ||
Preferred Stock, $0.0001 par value; 1,000,000 shares authorized, none issued or outstanding | 0 | 0 |
Common Stock, $0.0001 par value; 50,000,000 shares authorized; 43,053,003 and 43,056,310 issued; 42,943,447 and 43,028,074 outstanding, respectively | 4 | 4 |
Additional Paid in Capital | 392,552 | 391,852 |
Treasury shares, at cost; 212,083 shares | (431) | (431) |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 8,493 | 11,319 |
Retained Earnings | 84,838 | 100,394 |
Total Stockholders' Equity | 485,456 | 503,138 |
Stockholders' Equity Attributable to Noncontrolling Interest | 20,701 | 20,727 |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 506,157 | 523,865 |
Total Liabilities and Stockholders' Equity | $ 2,331,759 | $ 2,467,218 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value | $ 0.0001 | $ 0.0001 |
Preferred stock, authorized shares | 0 | 0 |
Preferred stock, issued shares | 0 | 0 |
Preferred stock, outstanding shares | 0 | 0 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, authorized shares | 50,000,000 | 50,000,000 |
Common stock, issued shares | 43,053,003 | 43,056,310 |
Common Stock, Shares, Outstanding | 42,943,447 | 43,028,074 |
Treasury stock | 212,083 | 212,083 |
Financing Receivable, Allowance for Credit Loss | $ 112 | $ 141 |
Premium Receivable, Allowance for Credit Loss | 126 | 165 |
Reinsurance Recoverable, Allowance for Credit Loss | 241 | 256 |
Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Fixed maturities, cost | 862,565 | 869,598 |
Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Fixed maturities, cost | $ 9,336 | $ 8,067 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
REVENUE: | ||
Gross premiums written | $ 335,183 | $ 318,559 |
Change in gross unearned premiums | 9,436 | (6,746) |
Gross premiums earned | 344,619 | 311,813 |
Ceded premiums earned | (153,023) | (131,091) |
Net premiums earned | 191,596 | 180,722 |
Investment Income, Net | 6,917 | 7,295 |
Net realized gains (losses) | (68) | 181 |
Unrealized Gain (Loss) on Securities | (26,456) | 10,173 |
Other revenue | 4,315 | 3,950 |
Total revenue | 176,304 | 202,321 |
EXPENSES: | ||
Losses and loss adjustment expenses | 102,837 | 104,547 |
Policy acquisition costs | 58,875 | 55,246 |
Operating Costs and Expenses | 9,704 | 10,211 |
General and administrative expenses | 18,301 | 17,581 |
Interest expense | 2,419 | 2,409 |
Total expenses | 192,136 | 189,994 |
Income (loss) before other income | (15,832) | 12,327 |
Other income | 28 | 6 |
Income (loss) before income taxes | (15,804) | 12,333 |
Provision for income taxes | (3,288) | 2,755 |
Net Income (Loss), Including Portion Attributable to Nonredeemable Noncontrolling Interest | (12,516) | 9,578 |
Net income (loss) | (12,723) | 9,469 |
Net Income (Loss) Attributable to Noncontrolling Interest | 207 | 109 |
Comprehensive Income (Loss), Net of Tax, Attributable to Noncontrolling Interest | (26) | 231 |
OTHER COMPREHENSIVE INCOME: | ||
Change in net unrealized gains (losses) on investments | (4,110) | 14,322 |
Reclassification adjustment for net realized investment (gains) losses | 68 | (181) |
Income tax benefit (expense) related to items of other comprehensive income | 983 | (3,459) |
Comprehensive Income (Loss), Net of Tax, Including Portion Attributable to Noncontrolling Interest | (15,575) | 20,260 |
Total comprehensive income | $ (15,549) | $ 20,029 |
Weighted-average shares outstanding | ||
Weighted-average shares outstanding | 42,805,527 | 42,696,681 |
Weighted-average diluted shares | 42,805,527 | 42,986,484 |
Earnings Per Share | ||
Basic earnings per share | $ (0.30) | $ 0.22 |
Diluted earnings per share | $ (0.30) | $ 0.22 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
OPERATING ACTIVITIES | ||
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | $ (12,516) | $ 9,578 |
Adjustments to reconcile net income to net cash provided by operating activities | ||
Depreciation and amortization | 2,510 | 2,320 |
Bond amortization and accretion | 1,564 | 1,186 |
Net realized gains (losses) | 68 | (181) |
Unrealized Gain (Loss) on Investments | 26,456 | (10,173) |
Provision for uncollectable premiums/over and short | 10 | (58) |
Deferred income taxes, net | (3,461) | (958) |
Stock based compensation | 700 | 901 |
Changes in operating assets and liabilities: | ||
Accrued investment income | 423 | 352 |
Premiums receivable | (3,854) | 2,946 |
Reinsurance recoverable on paid and unpaid losses | 35,395 | (28,462) |
Ceded unearned premiums | 90,521 | 84,581 |
Deferred policy acquisition costs, net | (310) | (3,907) |
Other assets | (6,999) | (2,902) |
Unpaid losses and loss adjustment expenses | (49,315) | (31,235) |
Unearned premiums | (9,436) | 6,746 |
Reinsurance payable | (53,741) | (59,153) |
Payments outstanding | (12,526) | 9,107 |
Accounts Payable | (8,086) | (6,899) |
Change in Operating Lease Liability | 2,097 | 438 |
Other liabilities | 17,998 | 23,309 |
Net cash provided by operating activities | 17,498 | (2,464) |
INVESTING ACTIVITIES | ||
Proceeds from sales and maturities of fixed maturities | 63,743 | 45,586 |
Proceeds from Sale of Available-for-sale Securities, Equity | 1,233 | 511 |
Proceeds from Sale and Maturity of Other Investments | 212 | 2,256 |
Payments to Acquire Fixed Maturities, Available-for-sale | 58,266 | 23,359 |
Purchases of Equity securities | (21,116) | (862) |
Payments to Acquire Other Investments | 1,481 | 5,361 |
Cost of property, equipment and capitalized software acquired | (3,515) | (3,297) |
Net cash provided by (used in) investing activities | (19,190) | 15,474 |
FINANCING ACTIVITIES | ||
Repayments of borrowings | (381) | (382) |
Payments of Dividends | (2,571) | (2,569) |
Net Cash Provided by (Used in) Financing Activities | (2,952) | (2,951) |
Cash, Cash Equivalents, Restricted Cash Increase (decrease) | (4,644) | 10,059 |
Cash, Cash Equivalents, Restricted Cash at beginning of period | 287,057 | 184,120 |
Cash, Cash Equivalents, Restricted Cash at end of period | 282,413 | 194,179 |
Supplemental Cash Flows Information | ||
Interest Paid | 70 | 105 |
Income taxes paid | $ 0 | $ 0 |
Consolidated Statement of Stock
Consolidated Statement of Stockholders' Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Parent | Noncontrolling Interest | Comprehensive Income |
Beginning balance (shares) at Dec. 31, 2018 | 42,984,578 | |||||||
Beginning balance (Total) at Dec. 31, 2018 | $ 540,369 | |||||||
Beginning balance (NCI) at Dec. 31, 2018 | $ 20,139 | |||||||
Beginning balance (Parent) at Dec. 31, 2018 | $ 4 | $ 389,141 | $ (431) | $ 140,546 | $ 520,230 | $ (9,030) | ||
Net Income (Loss), Total | 9,578 | |||||||
Net Income (Loss), Parent | 9,469 | 0 | 0 | 0 | 9,469 | 9,469 | 0 | |
Net Income (Loss), NCI | 109 | 109 | ||||||
Other Comprehensive Income (Loss), Parent | $ 0 | 0 | 0 | 0 | 10,560 | 10,560 | ||
Other Comprehensive Income (Loss), NCI | 122 | |||||||
Other Comprehensive Income (Loss), Total | 10,682 | |||||||
Stock Issued During Period, Shares, Shares-based Compensation, Gross | 24,151 | |||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | 901 | $ 0 | 901 | 0 | 0 | 901 | 0 | 0 |
Cash dividends on common stock | (2,569) | $ 0 | 0 | 0 | (2,569) | (2,569) | 0 | 0 |
Ending Balance (shares) at Mar. 31, 2019 | 43,008,729 | |||||||
Ending Balance (Total) at Mar. 31, 2019 | $ 558,961 | |||||||
Ending Balance (Parent) at Mar. 31, 2019 | $ 4 | 390,042 | (431) | 147,446 | 538,591 | 1,530 | ||
Ending balance (NCI) at Mar. 31, 2019 | 20,370 | |||||||
Beginning balance (shares) at Dec. 31, 2019 | 43,028,074 | 43,028,074 | ||||||
Beginning balance (Total) at Dec. 31, 2019 | $ 523,865 | |||||||
Beginning balance (NCI) at Dec. 31, 2019 | 20,727 | 20,727 | ||||||
Beginning balance (Parent) at Dec. 31, 2019 | 503,138 | $ 4 | 391,852 | (431) | 100,394 | 503,138 | 11,319 | |
Net Income (Loss), Total | (12,516) | |||||||
Net Income (Loss), Parent | (12,723) | 0 | 0 | 0 | (12,723) | (12,723) | 0 | |
Net Income (Loss), NCI | 207 | 207 | ||||||
Other Comprehensive Income (Loss), Parent | 0 | 0 | 0 | 0 | (2,826) | (2,826) | ||
Other Comprehensive Income (Loss), NCI | (233) | |||||||
Other Comprehensive Income (Loss), Total | (3,059) | |||||||
Effect of new accounting principle in period of adoption | (262) | $ 0 | 0 | 0 | (262) | (262) | 0 | 0 |
Stock Issued During Period, Shares, Shares-based Compensation, Gross | (84,627) | |||||||
Stock Issued During Period, Value, Restricted Stock Award, Gross | 700 | $ 0 | 700 | 0 | 0 | 700 | 0 | 0 |
Cash dividends on common stock | $ (2,571) | $ 0 | 0 | 0 | (2,571) | (2,571) | 0 | 0 |
Ending Balance (shares) at Mar. 31, 2020 | 42,943,447 | 42,943,447 | ||||||
Ending Balance (Total) at Mar. 31, 2020 | $ 506,157 | |||||||
Ending Balance (Parent) at Mar. 31, 2020 | 485,456 | $ 4 | $ 392,552 | $ (431) | $ 84,838 | $ 485,456 | $ 8,493 | |
Ending balance (NCI) at Mar. 31, 2020 | $ 20,701 | $ 20,701 |
Organization, Consolidation and
Organization, Consolidation and Presentation | 3 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Consolidation and Presentation of Financial Statements Disclosure | ORGANIZATION, CONSOLIDATION AND PRESENTATION (a) Business United Insurance Holdings Corp. (referred to in this document as we, our, us, the Company or UPC Insurance) is a property and casualty insurance holding company that sources, writes and services residential personal and commercial property and casualty insurance policies using a network of agents, four wholly-owned insurance subsidiaries, and one majority-owned insurance subsidiary. Our largest insurance subsidiary is United Property & Casualty Insurance Company (UPC), which was formed in Florida in 1999 and has operated continuously since that time. Our four other insurance subsidiaries are Family Security Insurance Company, Inc. (FSIC), acquired via merger on February 3, 2015; Interboro Insurance Company (IIC), acquired via merger on April 29, 2016; American Coastal Insurance Company (ACIC), acquired via merger on April 3, 2017; and Journey Insurance Company (JIC). JIC was formed in strategic partnership with a subsidiary of Tokio Marine Kiln Group Limited (Kiln) on August 30, 2018. The Kiln subsidiary holds a noncontrolling interest in JIC. Our other subsidiaries include United Insurance Management, L.C. (UIM), a managing general agent that manages substantially all aspects of UPC and FSIC's business; Skyway Claims Services, LLC, which provides claims adjusting services to UPC, FSIC and IIC; AmCo Holding Company, LLC (AmCo) and Family Security Holdings, LLC (FSH), which are holding company subsidiaries that consolidate their respective insurance companies; BlueLine Cayman Holdings (BlueLine), which reinsures portfolios of excess and surplus policies; UPC Re, which provides a portion of the reinsurance protection purchased by our insurance subsidiaries when needed; and Skyway Reinsurance Services, LLC, which provides reinsurance brokerage services for our insurance companies. Our primary product is homeowners' insurance, which we currently offer in 12 states, under authorization from the insurance regulatory authorities in each state. In addition, we write commercial residential insurance in the state of Florida. We are also licensed to write property and casualty insurance in an additional six states; however, we have not commenced writing in these states. We conduct our operations under one reportable segment, property and casualty insurance policies. Our chief operating decision maker is our Chief Executive Officer, who makes decisions to allocate resources and assesses performance at the corporate level. (b) Consolidation and Presentation We prepare our unaudited condensed consolidated interim financial statements in conformity with U.S. generally accepted accounting principles (GAAP). We have condensed or omitted certain information and footnote disclosures normally included in the annual consolidated financial statements presented in accordance with GAAP. In management's opinion, the accompanying unaudited condensed consolidated financial statements reflect all adjustments, including normal recurring items, considered necessary for a fair presentation of interim periods. We include all of our subsidiaries in our consolidated financial statements, eliminating intercompany balances and transactions during consolidation. Our unaudited condensed consolidated interim financial statements and footnotes should be read in conjunction with our consolidated financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2019. While preparing our unaudited condensed consolidated financial statements, we make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the unaudited condensed consolidated financial statements, as well as reported amounts of revenues and expenses during the reporting period. Accordingly, actual results could differ from those estimates. Reported amounts that require us to make extensive use of estimates include our reserves for unpaid losses and loss adjustment expenses, investments and goodwill. Except for the captions on our Unaudited Condensed Consolidated Balance Sheets and Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), we generally use the term loss(es) to collectively refer to both loss and loss adjustment expenses. We reclassified certain amounts in the 2019 financial statements to conform to the 2020 presentation, including reclassifying the presentation of "outstanding checks in excess of funds on deposit" in the financing section of the Unaudited Condensed Consolidated Statements of Cash Flows to "changes in payments outstanding" in the operating section, to provide the users of the financial statement with more transparency. These reclassifications had no impact on our results of operations or stockholders' equity, as previously reported. Our results of operations and our cash flows as of the end of the interim periods reported herein do not necessarily indicate our results for the remainder of the year or for any other future period. (c) Impact of COVID-19, Financial Status and Outlook In recent months, there has been an outbreak of a novel strain of COVID-19 in many countries in the world, which was declared a pandemic by the World Health Organization in March 2020. This has resulted in governments worldwide enacting emergency measures to combat the spread of the virus. These measures, which include the implementation of travel bans and restrictions, self-imposed quarantine periods, state and local shelter-in-place orders, business and government shutdowns and social distancing, have caused material disruption to businesses and economies globally. In addition, global equity markets have experienced significant volatility and weakness. We are committed to our employees, agents, customers and shareholders in our resolve to maintain a stable and secure business. We have continued to operate at nearly full capacity while taking the necessary steps to ensure the health and safety of our employees through adherence to CDC and local government work guidelines. In addition, we have converted to virtual sales processes to enable our agents to continue their activities. We have not seen a material impact from COVID-19 on our business operations, financial position, liquidity or our ability to service our policyholders to date, with the exception of fluctuations in our investment portfolios due to volatility in the equity securities markets, as further described in Part I, Item 2. " Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Form 10-Q. The COVID-19 pandemic and resulting global disruptions did not have a material impact on our access to credit and capital markets needed to maintain sufficient liquidity for our continued operating needs. The scope, severity and longevity of any business shutdowns and economic disruption as a result of the COVID-19 outbreak is highly uncertain and cannot be predicted at this time, as new information may continue to emerge concerning the actions governments may take to contain or mitigate the spread of the virus or address its impact on individuals, businesses and the economy. We did not incur material claims or significant disruptions to our business for the three months ended March 31, 2020. At this time, it is not possible to reasonably estimate the extent of the impact of the economic uncertainties on our business, results of operations and financial conditions in future periods, but we will continue to respond to the COVID-19 pandemic and take reasonable measures to make sure customers continue to be served without interruption. |
Significant Accounting Policies
Significant Accounting Policies Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | SIGNIFICANT ACCOUNTING POLICIES (a) Changes to Significant Accounting Policies We have made no changes to our significant accounting policies as reported in our Annual Report on Form 10-K for the year ended December 31, 2019, except for the standards adopted in 2020 as noted below. (b) Allowance for Expected Credit Losses We are exposed to credit losses primarily through three different pools of assets based on similar risk characteristics: premiums receivable for direct written business; reinsurance recoverables from ceded losses to our reinsurers; and our note receivable. We estimate the expected credit losses based on historical trends, credit ratings assigned to reinsurers by rating agencies, average default rates, current economic conditions, and reasonable and supportable forecasts of future economic conditions that affect the collectability of the reported amounts over its expected life. Changes in the relevant information may significantly affect the estimates of expected credit losses. The allowance for credit losses is deducted from the amortized cost basis of the assets to present their net carrying value at the amount expected to be collected. Each period, the allowance for credit losses is adjusted through earnings to reflect expected credit losses over the remaining lives of the assets. The following table summarizes our allowance for expected credit losses by pooled asset for the three months ended March 31, 2020: December 31, 2019 Provision for expected credit losses Write-offs March 31, 2020 Premiums Receivable $ 165 $ (39 ) $ — $ 126 Reinsurance Recoverables 256 (15 ) — 241 Note Receivable 141 (29 ) — 112 Total $ 562 $ (83 ) $ — $ 479 (c) Income Taxes On March 27, 2020, the U.S. enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act to mitigate the economic impacts of the COVID-19 crisis. We are assessing the impact of applying the tax provisions of the CARES Act, and believe it will have a favorable but immaterial impact on our U.S. Federal Tax obligations. (d) Recently Adopted Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13). This update modifies the existing disclosure requirements on fair value measurements in Topic 820 by changing requirements regarding Level 1, Level 2 and Level 3 investments. ASU 2018-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual periods. Entities are permitted to early adopt any removed or modified disclosures of ASU 2018-13 immediately and delay the adoption of the additional disclosures until their effective date. We early adopted the guidance on removed and modified disclosures and adopted the remainder of the guidance on January 1, 2020, which has not impacted the accompanying unaudited condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04). This update simplifies the manner in which an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. ASU 2017-04 is effective for annual periods beginning after December 15, 2019, including interim periods within those annual periods, with early adoption permitted for certain requirements. We intend to adopt this new guidance when we perform our annual assessment of goodwill as of September 30, 2020. In the event that a triggering event occurs and requires an earlier interim assessment, we intend to adopt the updated guidance at that time. Any impact of the standard on our consolidated financial statements and related disclosures will be dependent on market conditions of the reporting units at the time of our assessment and subsequent adoption. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). This update is intended to replace the incurred loss impairment methodology in current GAAP with a method that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 will provide users with more useful information regarding the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. In addition, credit losses on available-for-sale debt securities will now have to be presented as an allowance rather than as a write-down. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We adopted this guidance as of January 1, 2020 using a modified retrospective approach, which allowed us to initially apply the new credit loss guidance at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings for 2020, with no adjustment to prior periods presented.The cumulative effect to the opening balance of retained earnings was a decrease of $262,000 , net of reversals from allowances recorded under prior guidance. (e) Pending Accounting Pronouncements We have evaluated recent accounting pronouncements that have had or may have a significant effect on our financial statements or on our disclosures. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (ASU 2019-12). This update enhances and simplifies various aspects of the income tax guidance, including intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 is effective for annual reporting periods beginning after December 15, 2020, including interim periods within those fiscal years, with early adoption permitted. We do not intend to early adopt and are assessing the impact of adopting this new accounting standard on our unaudited condensed consolidated financial statements and related disclosures. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | INVESTMENTS The following table details fixed-maturity available-for-sale securities, by major investment category, at March 31, 2020 and December 31, 2019 : Cost or Adjusted/Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value March 31, 2020 U.S. government and agency securities $ 104,530 $ 5,034 $ 44 $ 109,520 Foreign government 3,721 70 1 3,790 States, municipalities and political subdivisions 126,962 2,885 38 129,809 Public utilities 27,125 479 313 27,291 Corporate securities 285,633 4,087 7,025 282,695 Mortgage-backed securities 255,523 8,872 1,541 262,854 Asset-backed securities 52,181 282 849 51,614 Redeemable preferred stocks 6,890 — 677 6,213 Total fixed maturities $ 862,565 $ 21,709 $ 10,488 $ 873,786 December 31, 2019 U.S. government and agency securities $ 120,260 $ 749 $ 193 $ 120,816 Foreign government 3,975 97 1 4,071 States, municipalities and political subdivisions 131,203 2,611 63 133,751 Public utilities 24,660 700 26 25,334 Corporate securities 281,892 7,123 143 288,872 Mortgage-backed securities 248,206 4,174 477 251,903 Asset-backed securities 56,487 683 41 57,129 Redeemable preferred stocks 2,915 72 2 2,985 Total fixed maturities $ 869,598 $ 16,209 $ 946 $ 884,861 Equity securities are summarized as follows: March 31, 2020 December 31, 2019 Estimated Fair Value Percent of Total Estimated Fair Value Percent of Total Mutual funds $ 52,492 46.9 % $ 65,453 56.1 % Public utilities 6,255 5.6 3,663 3.1 Other common stocks 45,801 40.9 44,492 38.2 Nonredeemable preferred stocks 7,367 6.6 3,002 2.6 Total equity securities $ 111,915 100.0 % $ 116,610 100.0 % When we sell investments, we calculate the gain or loss realized on the sale by comparing the sales price (fair value) to the cost or adjusted/amortized cost of the security sold. We determine the cost or adjusted/amortized cost of the security sold using the specific-identification method. The following table details our realized gains (losses) by major investment category for the three months ended March 31, 2020 and 2019 : 2020 2019 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Three Months Ended March 31, Fixed maturities $ 345 $ 59,225 $ 248 $ 6,004 Equity securities 12 280 6 59 Short-term investments — 35 — — Total realized gains 357 59,540 254 6,063 Fixed maturities (337 ) 4,518 (36 ) 9,589 Equity securities (88 ) 953 (37 ) 383 Short-term investments — 128 — — Total realized losses (425 ) 5,599 (73 ) 9,972 Net realized investment gains (losses) $ (68 ) $ 65,139 $ 181 $ 16,035 The table below summarizes our fixed maturities at March 31, 2020 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturities of those obligations. March 31, 2020 Cost or Amortized Cost Percent of Total Fair Value Percent of Total Due in one year or less $ 81,916 9.5 % $ 81,888 9.4 % Due after one year through five years 266,843 30.9 269,289 30.8 Due after five years through ten years 194,258 22.5 196,540 22.5 Due after ten years 11,844 1.4 11,601 1.3 Asset and mortgage backed securities 307,704 35.7 314,468 36.0 Total $ 862,565 100.0 % $ 873,786 100.0 % The following table summarizes our net investment income by major investment category: Three Months Ended March 31, 2020 2019 Fixed maturities $ 5,470 $ 6,062 Equity securities 771 492 Cash and cash equivalents 671 135 Other investments 266 768 Other assets 9 88 Investment income 7,187 7,545 Investment expenses (270 ) (250 ) Net investment income $ 6,917 $ 7,295 Portfolio monitoring We have a quarterly portfolio monitoring process to identify and evaluate each fixed-income security whose carrying value may be impaired as the result of a credit loss. For each fixed-income security in an unrealized loss position, if we determine that we intend to sell the security or that it is more likely than not that we will be required to sell the security before recovery of the cost or amortized cost basis for reasons such as liquidity needs, contractual or regulatory requirements. The security's entire decline in fair value is recorded in earnings. If our management decides not to sell the fixed-income security and it is more likely than not that we will not be required to sell the fixed-income security before recovery of its amortized cost basis, we evaluate whether the decline in fair value has resulted from credit losses or other factors. This is typically indicated by a change in the rating of the security assigned by a rating agency, and any adverse conditions specifically related to the security or industry, among other factors. If the assessment indicates that a credit loss may exist, the present value of cash flows expected to be collected from the security are compared to the amortized cost basis of the security. If the present value of cash flows expected to be collected is less than the amortized cost basis, a credit loss exists and an allowance for credit losses will be recorded in earnings. Credit loss is limited to the difference between a security's amortized cost basis and its fair value. Any additional impairment not recorded through an allowance for credit losses is recognized in other comprehensive income (loss). During the three months ended March 31, 2020, we determined that none of our fixed-income securities shown in the table below that are in an unrealized loss position, have declines in fair value that are reflected as a result of credit losses. Therefore, no credit loss allowance was recorded at March 31, 2020. The issuers of our debt security investments continue to make interest payments on a timely basis. We do not intend to sell, nor is it likely that we would be required to sell the debt securities before we recover our amortized cost basis. Equity securities are reported at fair value with changes in fair value recognized in the valuation of equity investments. The following table presents an aging of our unrealized investment losses by investment class: Less Than Twelve Months Twelve Months or More Number of Securities (1) Gross Unrealized Losses Fair Value Number of Securities (1) Gross Unrealized Losses Fair Value March 31, 2020 U.S. government and agency securities 3 $ 2 $ 2,467 22 $ 42 $ 13,125 Foreign governments — — — 1 1 350 States, municipalities and political subdivisions 19 38 13,084 — — — Public utilities 31 313 14,960 — — — Corporate securities 300 6,948 134,296 10 77 2,792 Mortgage-backed securities 93 1,304 53,126 10 237 3,904 Asset-backed securities 57 843 23,749 1 6 994 Redeemable preferred stocks 66 677 6,116 — — — Total fixed maturities 569 $ 10,125 $ 247,798 44 $ 363 $ 21,165 December 31, 2019 U.S. government and agency securities 37 $ 89 $ 26,372 39 $ 104 $ 31,364 Foreign governments — — — 2 1 600 States, municipalities and political subdivisions 31 61 14,508 2 2 1,262 Public utilities 9 25 4,626 2 1 250 Corporate securities 42 124 22,435 27 19 9,605 Mortgage-backed securities 89 322 59,101 50 155 12,738 Asset-backed securities 15 34 8,447 5 7 1,259 Redeemable preferred stocks — — — 1 2 97 Total fixed maturities 223 $ 655 $ 135,489 128 $ 291 $ 57,175 (1) This amount represents the actual number of discrete securities, not the number of shares or units of those securities. The numbers are not presented in thousands. Fair value measurement Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The hierarchy for inputs used in determining fair value maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Assets and liabilities recorded on our Unaudited Condensed Consolidated Balance Sheets at fair value are categorized in the fair value hierarchy based on the observability of inputs to the valuation techniques as follows: Level 1: Assets and liabilities whose values are based on unadjusted quoted prices for identical assets or liabilities in an active market that we can access. Level 2: Assets and liabilities whose values are based on the following: (a) Quoted prices for similar assets or liabilities in active markets; (b) Quoted prices for identical or similar assets or liabilities in markets that are not active; or (c) Valuation models whose inputs are observable, directly or indirectly, for substantially the full term of the asset or liability. Level 3: Assets and liabilities whose values are based on prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement. Unobservable inputs reflect our estimates of the assumptions that market participants would use in valuing the assets and liabilities. We estimate the fair value of our investments using the closing prices on the last business day of the reporting period, obtained from active markets such as the NYSE, Nasdaq and NYSE American. For securities for which quoted prices in active markets are unavailable, we use a third-party pricing service that utilizes quoted prices in active markets for similar instruments, benchmark interest rates, broker quotes and other relevant inputs to estimate the fair value of those securities for which quoted prices are unavailable. Our estimates of fair value reflect the interest rate environment that existed as of the close of business on March 31, 2020 and December 31, 2019 . Changes in interest rates subsequent to March 31, 2020 may affect the fair value of our investments. The fair value of our fixed maturities is initially calculated by a third-party pricing service. Valuation service providers typically obtain data about market transactions and other key valuation model inputs from multiple sources and, through the use of proprietary models, produce valuation information in the form of a single fair value for individual fixed-income and other securities for which a fair value has been requested. The inputs used by the valuation service providers include, but are not limited to, market prices from recently completed transactions and transactions of comparable securities, interest rate yield curves, credit spreads, liquidity spreads, currency rates and other information, as applicable. Credit and liquidity spreads are typically implied from completed transactions and transactions of comparable securities. Valuation service providers also use proprietary discounted cash flow models that are widely accepted in the financial services industry and similar to those used by other market participants to value the same financial information. The valuation models take into account, among other things, market observable information as of the measurement date, as described above, as well as the specific attributes of the security being valued, including its term, interest rate, credit rating, industry sector and, where applicable, collateral quality and other issue or issuer specific information. Executing valuation models effectively requires seasoned professional judgment and experience. Any change in the estimated fair value of our fixed-income securities would impact the amount of unrealized gain or loss we have recorded, which could change the amount we have recorded for our investments and other comprehensive income (loss) on our Unaudited Condensed Consolidated Balance Sheet as of March 31, 2020 . The following table presents the fair value of our financial instruments measured on a recurring basis by level at March 31, 2020 and December 31, 2019 : Total Level 1 Level 2 Level 3 March 31, 2020 U.S. government and agency securities $ 109,520 $ — $ 109,520 $ — Foreign government 3,790 — 3,790 — States, municipalities and political subdivisions 129,809 — 129,809 — Public utilities 27,291 — 27,291 — Corporate securities 282,695 — 282,695 — Mortgage-backed securities 262,854 — 262,854 — Asset-backed securities 51,614 — 51,614 — Redeemable preferred stocks 6,213 1,815 4,398 — Total fixed maturities 873,786 1,815 871,971 — Mutual funds 52,492 52,492 — — Public utilities 6,255 6,255 — — Other common stocks 45,801 45,801 — — Non-redeemable preferred stocks 7,367 7,367 — — Total equity securities 111,915 111,915 — — Other investments (1) 1,590 300 1,290 — Total investments $ 987,291 $ 114,030 $ 873,261 $ — December 31, 2019 U.S. government and agency securities $ 120,816 $ — $ 120,816 $ — Foreign government 4,071 — 4,071 — States, municipalities and political subdivisions 133,751 — 133,751 — Public utilities 25,334 — 25,334 — Corporate securities 288,872 — 288,872 — Mortgage-backed securities 251,903 — 251,903 — Asset-backed securities 57,129 — 57,129 — Redeemable preferred stocks 2,985 747 2,238 — Total fixed maturities 884,861 747 884,114 — Mutual Funds 65,453 65,453 — — Public utilities 3,663 3,663 — — Other common stocks 44,492 44,492 — — Non-redeemable preferred stocks 3,002 3,002 — — Total equity securities 116,610 116,610 — — Other investments (1) 499 300 199 — Total investments $ 1,001,970 $ 117,657 $ 884,313 $ — (1) Other investments included in the fair value hierarchy exclude these limited partnership interests that are measured at estimated fair value using the net asset value per share (or its equivalent) practical expedient. The carrying amounts for the following financial instrument categories approximate their fair values at March 31, 2020 and December 31, 2019 , because of their short-term nature: cash and cash equivalents, accrued investment income, premiums receivable, reinsurance recoverable, reinsurance payable, other assets, and other liabilities. The carrying amount of the notes payable to the Florida State Board of Administration, the Branch Banking & Trust Corporation (BB&T) and our senior notes approximate fair value as the interest rates and terms are variable. We are responsible for the determination of fair value and the supporting assumptions and methodologies. We have implemented a system of processes and controls designed to provide assurance that our assets and liabilities are appropriately valued. For fair values received from third parties, our processes are designed to provide assurance that the valuation methodologies and inputs are appropriate and consistently applied, the assumptions are reasonable and consistent with the objective of determining fair value, and the fair values are accurately recorded. At the end of each quarter, we determine whether we need to transfer the fair values of any securities between levels of the fair value hierarchy and, if so, we report the transfer as of the end of the quarter. During the quarter ended March 31, 2020 , we transferred no investments between levels. For our investments in U.S. government securities that do not have prices in active markets, agency securities, state and municipal governments, and corporate bonds, we obtain the fair values from our investment custodians, which use a third-party valuation service. The valuation service calculates prices for our investments in the aforementioned security types on a month-end basis by using several matrix-pricing methodologies that incorporate inputs from various sources. The model the valuation service uses to price U.S. government securities and securities of states and municipalities incorporates inputs from active market makers and inter-dealer brokers. To price corporate bonds and agency securities, the valuation service calculates non-call yield spreads on all issuers, uses option-adjusted yield spreads to account for any early redemption features, and adds final spreads to the U.S. Treasury curve at 3 p.m. (ET) as of quarter end. Since the inputs the valuation service uses in its calculations are not quoted prices in active markets, but are observable inputs, they represent Level 2 inputs. Other investments We acquired investments in limited partnerships, recorded in the other investments line of our Unaudited Condensed Consolidated Balance Sheets, and we currently account for these investments at fair value utilizing a net asset value per share equivalent methodology. The information presented in the table below is as of March 31, 2020 : Book Value Unrealized Gain Unrealized Loss Fair Value Limited partnership investments (1) $ 7,746 $ 321 $ 92 $ 7,975 Certificates of deposit 300 — — 300 Short-term investments 1,290 — — 1,290 Total other investments $ 9,336 $ 321 $ 92 $ 9,565 (1) Distributions will be generated from investment gains, from operating income, from underlying investments of funds, and from liquidation of the underlying assets of the funds. We estimate that the underlying assets of the funds will be liquidated over the next two to ten years. Restricted Cash We are required to maintain assets on deposit with various regulatory authorities to support our insurance operations. The cash on deposit with state regulators is available to settle insurance liabilities. We also use trust funds in certain reinsurance transactions. The following table presents the components of restricted assets: March 31, 2020 December 31, 2019 Trust funds $ 63,134 $ 70,668 Cash on deposit (regulatory deposits) 924 920 Total restricted cash $ 64,058 $ 71,588 |
Earnings per Share
Earnings per Share | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE (EPS) Basic EPS is based on the weighted average number of common shares outstanding for the period, excluding any dilutive common share equivalents. Diluted EPS reflects the potential dilution resulting from the vesting of outstanding restricted stock awards, restricted stock units, performance stock units and stock options. The following table shows the computation of basic and diluted EPS for the three-month periods ended March 31, 2020 and 2019 , respectively: Three Months Ended March 31, 2020 2019 Numerator: Net income (loss) attributable to UIHC common stockholders $ (12,723 ) $ 9,469 Denominator: Weighted-average shares outstanding 42,805,527 42,696,681 Effect of dilutive securities — 289,803 Weighted-average diluted shares 42,805,527 42,986,484 Earnings available to UIHC common stockholders per share Basic $ (0.30 ) $ 0.22 Diluted $ (0.30 ) $ 0.22 See Note 15 of these Notes to Unaudited Condensed Consolidated Financial Statements for additional information on the stock grants related to dilutive securities. |
Property and Equipment, Net
Property and Equipment, Net | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment, Net | PROPERTY AND EQUIPMENT, NET Property and equipment, net consisted of the following: March 31, December 31, Land $ 2,114 $ 2,114 Building and building improvements (construction in progress of $2,904 and $2,180, respectively) 12,040 11,315 Computer hardware and software (software in progress of $8,805 and $6,317, respectively) 35,722 33,219 Office furniture and equipment 3,234 3,260 Leasehold improvements 94 20 Leased vehicles (1) 1,898 — 1,693 Total, at cost 55,102 51,621 Less: accumulated depreciation and amortization (20,147 ) (18,893 ) Property and equipment, net $ 34,955 $ 32,728 (1) Includes vehicles under capital leases. See Note 10 of these Notes to Unaudited Condensed Consolidated Financial Statements for further information on leases. Depreciation and amortization expense under property and equipment was $1,287,000 and $870,000 for the three months ended March 31, 2020 and 2019 , respectively. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | GOODWILL AND INTANGIBLE ASSETS Goodwill The carrying amount of goodwill, both at March 31, 2020 and December 31, 2019 , was $73,045,000 . There was no goodwill acquired or disposed of during the three -month periods ended March 31, 2020 and 2019. We completed our most recent goodwill impairment testing during the fourth quarter of 2019 and determined that there was no impairment in the value of the asset as of December 31, 2019. The future potential impacts of COVID-19 on the operating results of our reporting units are uncertain, as we continue to monitor the global economic volatility. However, we remain committed to our strategic plan to realize our long-term forecasts. As a result of our analysis, and in consideration of the totality of events and circumstances, we did not identify any triggering events of impairment during the first quarter of 2020. No impairment loss in the value of goodwill was recognized during the three -month periods ended March 31, 2020 and 2019. Additionally, there was no accumulated impairment related to goodwill at March 31, 2020 or December 31, 2019 . Intangible Assets The following is a summary of intangible assets excluding goodwill recorded as intangible assets on our Unaudited Condensed Consolidated Balance Sheets: March 31, 2020 December 31, 2019 Intangible assets subject to amortization $ 21,303 $ 22,440 Indefinite-lived intangible assets (1) 3,638 3,639 Total $ 24,941 $ 26,079 (1) Indefinite-lived intangible assets are comprised of state insurance and agent licenses, as well as perpetual software licenses. Intangible assets subject to amortization consisted of the following: Weighted-average remaining amortization period (in years) Gross carrying amount Accumulated amortization Net carrying amount March 31, 2020 Value of business acquired — $ 42,788 $ (42,788 ) $ — Agency agreements acquired 6.7 34,661 (16,593 ) 18,068 Trade names acquired 4.0 6,381 (3,146 ) 3,235 Total $ 83,830 $ (62,527 ) $ 21,303 December 31, 2019 Value of business acquired — $ 42,788 $ (42,788 ) $ — Agency agreements acquired 6.8 34,661 (15,658 ) 19,003 Trade names acquired 4.3 6,381 (2,944 ) 3,437 Total $ 83,830 $ (61,390 ) $ 22,440 No impairment in the value of amortizing or non-amortizing intangible assets was recognized during the three months ended March 31, 2020 and 2019 . Amortization expense of our intangible assets was $1,137,000 and $1,365,000 for the three months ended March 31, 2020 and 2019 , respectively. Estimated amortization expense of our intangible assets to be recognized by the Company during the remainder of 2020 and over the next five years is as follows: Year ending December 31, Estimated Amortization Expense Remaining in 2020 $ 3,130 2021 3,555 2022 3,246 2023 3,246 2024 2,640 2025 2,438 |
Reinsurance
Reinsurance | 3 Months Ended |
Mar. 31, 2020 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance | REINSURANCE Our reinsurance program is designed, utilizing our risk management methodology, to address our exposure to catastrophes. Our program provides reinsurance protection for catastrophes, including hurricanes, tropical storms and tornadoes. These reinsurance agreements are part of our catastrophe management strategy, which is intended to provide our stockholders an acceptable return on the risks assumed in our property business, and to reduce variability of earnings, while providing protection to our policyholders. Although reinsurance agreements contractually obligate our reinsurers to reimburse us for the agreed-upon portion of our gross paid losses, they do not discharge our primary liability. Our program includes excess of loss, aggregate excess of loss and quota share treaties. Our excess of loss treaty, in effect from June 1, 2019 through May 31, 2020, provides coverage for catastrophe losses from named or numbered windstorms and earthquakes up to an exhaustion point of approximately $3,200,000,000 . In addition to this treaty, we have an aggregate excess of loss treaty effective January 1, 2020, which provides coverage for all catastrophe perils other than hurricanes, tropical storms, tropical depressions and earthquakes. We did not cede any catastrophe losses under this treaty for the three months ended March 31, 2020. The quota share agreement, effective June 1, 2019 to May 31, 2020, provides coverage for all catastrophe perils and attritional losses incurred by two of our insurance subsidiaries, UPC and FSIC. For all catastrophe perils, the quota share agreement provides ground-up protection effectively reducing our retention for catastrophe losses. Reinsurance recoverable at the balance sheet dates consists of the following: March 31, December 31, 2020 2019 Reinsurance recoverable on unpaid losses and loss adjustment expenses $ 423,609 $ 482,315 Reinsurance recoverable on paid losses and loss adjustment expenses 90,876 67,821 Reinsurance recoverable $ 514,485 $ 550,136 We write flood insurance under an agreement with the National Flood Insurance Program. We cede 100% of the premiums written and the related risk of loss to the federal government. We earn commissions for the issuance of flood policies based upon a fixed percentage of net written premiums and the processing of flood claims based upon a fixed percentage of incurred losses, and we can earn additional commissions by meeting certain growth targets for the number of in-force policies. We recognized commission revenue from our flood program of $333,000 and $342,000 for the three -month periods ended March 31, 2020 and 2019 , respectively. |
Liability for Unpaid Losses and
Liability for Unpaid Losses and Loss Adjustment Expenses | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Liability for unpaid losses and loss adjustment expenses | LIABILITY FOR UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSE (LAE) We determine the reserve for unpaid losses on an individual case basis for all incidents reported. The liability also includes amounts for incurred but not reported (IBNR) claims as of the balance sheet date. The table below shows the analysis of our reserve for unpaid losses for the three months ended March 31, 2020 and 2019 on a GAAP basis: March 31, 2020 2019 Balance at January 1 $ 760,357 $ 661,203 Less: reinsurance recoverable on unpaid losses 482,315 477,870 Net balance at January 1 $ 278,042 $ 183,333 Incurred related to: Current year 103,966 98,913 Prior years (1,129 ) 5,634 Total incurred $ 102,837 $ 104,547 Paid related to: Current year 30,935 31,215 Prior years 62,511 60,893 Total paid $ 93,446 $ 92,108 Net balance at March 31 $ 287,433 $ 195,772 Plus: reinsurance recoverable on unpaid losses 423,609 434,196 Balance at March 31 $ 711,042 $ 629,968 Composition of reserve for unpaid losses and LAE: Case reserves $ 294,679 $ 258,550 IBNR reserves 416,363 371,418 Balance at March 31 $ 711,042 $ 629,968 Based upon our internal analysis and our review of the annual statement of actuarial opinion provided by our actuarial consultants at year end, we believe that the reserve for unpaid losses reasonably represents the amount necessary to pay all claims and related expenses which may arise from incidents that have occurred as of the balance sheet date. As reflected in the table above, we had favorable developments in 2020 related to prior year losses. These favorable developments come as a result of strengthening of our case reserves at the end of 2019 based on a review of historical loss trends. The incurred losses and LAE and payments made during the quarter ended March 31, 2020 were in line with our incurred losses and LAE and payments made during the quarter ended March 31, 2019 . |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Long-term Debt | LONG-TERM DEBT Long-Term Debt The table below presents all long-term debt outstanding as of March 31, 2020 and December 31, 2019 : Effective Interest Rate Carrying Value at Maturity March 31, 2020 December 31, 2019 Senior Notes Payable December 15, 2027 6.25% $ 150,000 $ 150,000 Florida State Board of Administration Note Payable July 1, 2026 1.90% 7,353 7,647 BB&T Term Note Payable May 26, 2031 3.31% 3,871 3,958 Total long-term debt $ 161,224 $ 161,605 Senior Notes Payable On December 13, 2017, we issued $150,000,000 of 10 -year senior notes (the Senior Notes) that will mature on December 15, 2027 and bear interest at a rate equal to 6.25% per annum payable semi-annually on each June 15 and December 15, commencing June 15, 2018. The Senior Notes are senior unsecured obligations of the Company. We may redeem the Senior Notes at our option, at any time and from time to time in whole or in part, at a redemption price equal to the greater of (i) 100% of the principal amount of the notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal and interest thereon from the date of redemption to the date that is three months prior to maturity. On or after that date, we may redeem the Senior Notes at par. Florida State Board of Administration Note Payable On September 22, 2006, we issued a $20,000,000 , 20 -year note payable to the Florida State Board of Administration (the SBA Note). For the first three years of the SBA Note we were required to pay interest only. On October 1, 2009, we began to repay the principal in addition to interest. The SBA Note bears an annual interest rate equivalent to the 10-year Constant Maturity Treasury rate (as defined in the SBA Note agreement), which resets quarterly. BB&T Term Note Payable On May 26, 2016, we issued a $5,200,000 , 15 -year term note payable to BB&T (the BB&T Note), with the intent to use the funds to purchase, renovate, furnish and equip our principal executive office. The BB&T Note bears interest at 1.65% in excess of the one-month LIBOR, which resets monthly. LIBOR is expected to be phased out by the end of 2021. In the event of default, BB&T may, among other things, declare its loan immediately due and payable, require us to pledge additional collateral to the bank, and take possession of and foreclose upon our principal executive office, which has been pledged to the bank as security for the loan. Financial Covenants Senior Notes - Our Senior Notes provide that the Company and its subsidiaries shall not incur any indebtedness unless no default exists and the Company’s leverage ratio as of the last day of any annual or quarterly period (the balance sheet date) immediately preceding the date on which such additional indebtedness is incurred would have been no greater than 0.3:1, determined on a pro forma basis as if the additional indebtedness and all other indebtedness incurred since the immediately preceding balance sheet date had been incurred and the proceeds therefrom applied as of such day. The Company and its subsidiaries also may not create, assume, incur or permit to exist any indebtedness for borrowed money that is secured by a lien on the voting stock of any significant subsidiary without securing the Senior Notes equally. The Company may not issue, sell, assign, transfer or otherwise dispose of, directly or indirectly, any of the capital stock of the Company’s significant subsidiaries as of the issue date of the Senior Notes (except to the Company or to one or more of the Company’s other subsidiaries, or for the purpose of qualifying directors or as may be required by law or regulation), subject to certain exceptions. At March 31, 2020 , we were in compliance with the covenants in the Senior Notes. SBA Note - Our SBA Note requires that UPC maintain either a 2:1 ratio of net written premium to surplus, or net writing ratio, or a 6:1 ratio of gross written premium to surplus, or gross writing ratio, to avoid additional interest penalties. The SBA Note agreement defines surplus for the purpose of calculating the required ratios as the $20,000,000 of capital contributed to UPC under the agreement plus the outstanding balance of the note. Should UPC fail to exceed either a net writing ratio of 1.5:1 or a gross writing ratio of 4.5:1, UPC's interest rate will increase by 450 basis points above the 10-year Constant Maturity Treasury rate, which was 1.90% at the end of March 2020 . Any other writing ratio deficiencies result in an interest rate penalty of 25 basis points above the stated rate of the note. Our SBA Note further provides that the Florida State Board of Administration may, among other things, declare its loan immediately due and payable upon any default existing under the SBA Note; however, any payment is subject to approval by the insurance regulatory authority. At March 31, 2020 , we were in compliance with the covenants in the SBA Note. BB&T Note - Our BB&T Note requires that, at all times while there has been no losses from our insurance subsidiaries' operations (non-recurring losses), we will maintain a minimum cash flow coverage ratio of 1.2:1. The cash flow coverage ratio is defined as the ratio of our cash flow to debt service charges. This ratio will be tested annually, based on our audited financial statements. For the one-year period following a non-recurring loss, we are required to maintain a minimum cash flow coverage ratio of 1.0:1. This covenant will only be effective if the pre non-recurring losses test is failed, and is only available and effective for one annual test period. Thereafter, the non-recurring loss cash flow coverage ratio of 1.2:1 will immediately apply. At the time of the most recent annual test period, December 31, 2019, we were not in compliance with the minimum cash flow coverage ratio covenant in the BB&T Note. However, we obtained a waiver from BB&T for such non-compliance for the year ended December 31, 2019. In addition, the BB&T Note requires that we establish and maintain with BB&T at all times during the term of the loan a non-interest bearing demand deposit account with a minimum balance of $500,000, and an interest-bearing account with a minimum balance of $1,500,000. In the event of default, BB&T may, among other things, declare its loan immediately due and payable, require us to pledge additional collateral to the bank, and take possession of and foreclose upon our corporate headquarters, which has been pledged to the bank as security for the loan. At March 31, 2020 , we were in compliance with the covenants in the BB&T Note other than the minimum cash flow coverage ratio covenant. Debt Issuance Costs The table below presents the rollforward of our debt issuance costs paid, in conjunction with the debt instruments described above, during the three months ended March 31, 2020 and 2019: 2020 2019 Balance at January 1, $ 2,672 $ 3,010 Additions — — Amortization (84 ) (84 ) Balance at March 31, $ 2,588 $ 2,926 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES Litigation We are involved in claims-related legal actions arising in the ordinary course of business. We accrue amounts resulting from claims-related legal actions in unpaid losses and LAE during the period that we determine an unfavorable outcome becomes probable and we can estimate the amounts. Management makes revisions to our estimates based on its analysis of subsequent information that we receive regarding various factors, including: (i) per claim information; (ii) company and industry historical loss experience; (iii) judicial decisions and legal developments in the awarding of damages; and (iv) trends in general economic conditions, including the effects of inflation. At March 31, 2020 , we were not involved in any material non-claims-related legal actions. Commitments to fund partnership investments We have fully funded two limited partnership investments and have committed to fund our remaining four limited partnership investments. The amount of unfunded commitments was $2,161,000 and $2,201,000 at March 31, 2020 and December 31, 2019 , respectively. Leases We, as lessee, have entered into leases of commercial office space of various term lengths. In addition to office space, we lease office equipment and a parking lot under operating leases and vehicles under finance leases. The classification of operating and finance lease asset and liability balances within the Unaudited Condensed Consolidated Balance Sheets was as follows: Financial Statement Line March 31, 2020 December 31, 2019 Assets Operating lease assets Other assets $ 2,359 $ 335 Financing lease assets Property and equipment, net 1,316 1,263 Total lease assets $ 3,675 1,598 Liabilities Operating lease liabilities Operating lease liability $ 2,421 $ 324 Financing lease liabilities Other liabilities 37 34 Total lease liabilities $ 2,458 $ 358 The components of lease expenses were as follows: Three Months Ended March 31, 2020 March 31, 2019 Operating lease expense $ 127 $ 43 Financing lease expense: Amortization of leased assets 151 56 Short-term lease expense — 77 Net lease expense $ 278 $ 176 At March 31, 2020 , future minimum gross lease payments relating to these non-cancellable operating and finance lease agreements were as follows: Operating Leases Finance Leases Total Remaining in 2020 $ 472 $ 14 $ 486 2021 601 18 619 2022 527 8 535 2023 516 — 516 2024 528 — 528 Thereafter 1,373 — 1,373 Total undiscounted future minimum lease payments 4,017 40 4,057 Less: Imputed interest (1,596 ) (3 ) (1,599 ) Present value of lease liabilities $ 2,421 $ 37 $ 2,458 Weighted average remaining lease term and discount rate related to operating and finance leases were as follows: March 31, 2020 December 31, 2019 Weighted average remaining lease term (months) Operating leases 75 176 Financing leases 27 28 Weighted average discount rate Operating leases 3.56 % 4.00 % Financing leases 3.27 % 3.27 % Other cash and non-cash related activities were as follows: Three Months Ended March 31, 2020 March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Investing cash flows from financing leases $ 197 361 Right-of-use assets obtained in exchange for new operating lease liabilities 2,136 — Right-of-use assets obtained in exchange for new financing lease liabilities 203 371 See Note 9 of these Notes to Unaudited Condensed Consolidated Financial Statements for information regarding commitments related to long-term debt, and Note 11 of these Notes to Unaudited Condensed Consolidated Financial Statements for information regarding commitments related to regulatory actions. |
Statutory Accounting and Regula
Statutory Accounting and Regulation | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Statutory Accounting and Regulation | STATUTORY ACCOUNTING AND REGULATION The insurance industry is heavily regulated. State laws and regulations, as well as national regulatory agency requirements, govern the operations of all insurers such as our insurance subsidiaries. The various laws and regulations require that insurers maintain minimum amounts of statutory surplus and risk-based capital, restrict insurers' ability to pay dividends, specify allowable investment types and investment mixes, and subject insurers to assessments. Our insurance subsidiaries UPC, ACIC and JIC are domiciled in Florida, while FSIC and IIC are domiciled in Hawaii and New York, respectively. At March 31, 2020 , and during the three months then ended, our insurance subsidiaries met all regulatory requirements of the states in which they operate. We did not receive any significant assessments from regulatory authorities in the states in which our insurance subsidiaries operate. The National Association of Insurance Commissioners (NAIC) has Risk-Based Capital (RBC) guidelines for insurance companies that are designed to assess capital adequacy and to raise the level of protection that statutory surplus provides for policyholders. Most states, including Florida, Hawaii and New York, have enacted statutory requirements adopting the NAIC RBC guidelines, and insurers having less statutory surplus than required will be subject to varying degrees of regulatory action, depending on the level of capital inadequacy. State insurance regulatory authorities could require an insurer to cease operations in the event the insurer fails to maintain the required statutory capital. The state laws of Florida, Hawaii and New York permit an insurer to pay dividends or make distributions out of that part of statutory surplus derived from net operating profit and net realized capital gains. The state laws further provide calculations to determine the amount of dividends or distributions that can be made without the prior approval of the insurance regulatory authorities in those states and the amount of dividends or distributions that would require prior approval of the insurance regulatory authorities in those states. Statutory RBC requirements may further restrict our insurance subsidiaries' ability to pay dividends or make distributions if the amount of the intended dividend or distribution would cause statutory surplus to fall below minimum RBC requirements. The SBA Note is considered a surplus note pursuant to statutory accounting principles. As a result, UPC is subject to the authority of the Insurance Commissioner of the State of Florida with regard to its ability to repay principal and interest on the SBA Note. Any payment of principal or interest requires permission from the insurance regulatory authority. Our insurance subsidiaries must each file with the various insurance regulatory authorities an “Annual Statement” which reports, among other items, statutory net income (loss) and surplus as regards policyholders, which is called stockholders' equity under GAAP. For the three months ended March 31, 2020 , our combined recorded statutory net income was $7,208,000 . Our combined recorded statutory net loss for the three months ended March 31, 2019 was $7,735,000 . Our insurance subsidiaries must maintain capital and surplus ratios or balances as determined by the regulatory authority of the states in which they are domiciled. At March 31, 2020 , we met these requirements. The amount of surplus as regards policyholders for our regulated entities at March 31, 2020 and December 31, 2019 was $403,913,000 and $415,948,000 , respectively. |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS AmRisc, LLC AmRisc, a managing general agent, handles the underwriting, claims processing, premium collection and reinsurance review for AmCo. Effective January 1, 2019, R. Daniel Peed, Vice Chairman of our Board of Directors, became Non-Executive Vice Chairman of AmRisc. Effective December 31, 2019, Mr. Peed resigned from this position, terminating the related party relationship. In accordance with the managing general agency contract with AmRisc, we recorded $107,619,000 of gross written premiums for the three -month period ended March 31, 2019 , resulting in gross fees and commission (including a profit commission) of $28,979,000 for the three -month period ended March 31, 2019 , due to AmRisc. Receivables are stated net of the fees and commission due under the contract. In addition to the direct premiums written, we recorded $1,545,000 in ceded premiums to AmRisc as a reinsurance intermediary for the three -month period ended March 31, 2019 . |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income | ACCUMULATED OTHER COMPREHENSIVE INCOME We report changes in other comprehensive income items within comprehensive income (loss) on the Unaudited Condensed Consolidated Statements of Comprehensive Income (Loss), and we include accumulated other comprehensive income as a component of stockholders' equity on our Unaudited Condensed Consolidated Balance Sheets. The table below details the components of accumulated other comprehensive income at period end: Pre-Tax Amount Tax (Expense) Benefit Net-of-Tax Amount December 31, 2019 $ 14,962 $ (3,643 ) $ 11,319 Changes in net unrealized gains on investments (3,802 ) 890 (2,912 ) Reclassification adjustment for realized gains 69 17 86 March 31, 2020 $ 11,229 $ (2,736 ) $ 8,493 |
Stockholders' Equity
Stockholders' Equity | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | STOCKHOLDERS' EQUITY Our Board of Directors declared dividends on our outstanding shares of common stock to stockholders of record as follows for the periods presented (in thousands, except per share amounts): Three Months Ended March 31, 2020 2019 Per Share Amount Aggregate Amount Per Share Amount Aggregate Amount First Quarter $ 0.06 $ 2,571 $ 0.06 $ 2,569 In July 2019, our Board of Directors authorized a stock repurchase plan of up to $25,000,000 of our common stock. As of March 31, 2020 , we had not yet repurchased any shares under this stock repurchase plan. The timing and volume of repurchases are at the discretion of management, based on the capital needs of the business, the market price of UIHC common stock, and general market conditions. The plan has no expiration date, and the plan may be suspended or discontinued at any time. See Note 15 in these Notes to Unaudited Condensed Consolidated Financial Statements for information regarding stock-based compensation activity. |
Stock-Based Compensation
Stock-Based Compensation | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-Based Compensation | STOCK-BASED COMPENSATION We account for stock-based compensation under the fair value recognition provisions of ASC Topic 718 - Compensation - Stock Compensation . We recognize stock-based compensation cost over the award’s requisite service period on a straight-line basis for time-based restricted stock grants and performance-based restricted stock grants. We record forfeitures as they occur for all stock-based compensation. The following table presents our total stock-based compensation expense: Three Months Ended March 31, 2020 2019 Employee stock-based compensation expense Pre-tax $ 526 $ 530 Post-tax (1) 416 419 Director stock-based compensation expense Pre-tax 174 371 Post-tax (1) 137 293 (1) The after tax amounts are determined using the 21% corporate federal tax rate. We had approximately $3,037,000 of unrecognized stock compensation expense at March 31, 2020 related to non-vested stock-based compensation granted, which we expect to recognize over a weighted-average period of approximately 1.7 years. We had approximately $72,000 of unrecognized director stock-based compensation expense at March 31, 2020 related to non-vested director stock-based compensation granted, which we expect to recognize over a weighted-average period of approximately 0.1 years. Restricted stock, restricted stock units and performance stock units Stock-based compensation cost for restricted stock awards, restricted stock units and performance stock units is measured based on the closing fair market value of our common stock on the date of grant, which vest in equal installments over the requisite service period of typically three years. Restricted stock awards granted to non-employee directors vest over a one-year period. Each restricted stock unit and performance stock unit represents our obligation to deliver to the holder one share of common stock upon vesting. Performance stock units vest based on the Company's return on average equity compared to a defined group of peer companies. On the grant date, we issue the target number of performance stock units. They are subject to forfeitures if performance goals are not met. The actual number of performance stock units earned can vary from zero to 150 percent of the target for the 2018 and 2019 awards. We granted 1,175 shares of restricted common stock during the three -month period ended March 31, 2020 , which had a weighted-average grant date fair value of $8.75 per share. We granted 22,052 shares of restricted common stock during the three-month period ended March 31, 2019 , which had a weighted-average grant date fair value of $16.54 per share. The following table presents certain information related to the activity of our non-vested common stock grants: Number of Restricted Shares Weighted Average Grant Date Fair Value Outstanding as of December 31, 2019 214,495 $ 17.49 Granted 1,175 8.75 Less: Forfeited 400 16.54 Less: Vested 25,753 16.67 Outstanding as of March 31, 2020 189,517 $ 17.55 Stock options Stock option fair value was estimated on the grant date using the Black-Scholes-Merton formula. Stock options vest in equal installments over the requisite service period of typically three years. The following weighted-average assumptions were used to value the stock options granted: 2020 Expected annual dividend yield 1.28 % Expected volatility 41.07 % Risk-free interest rate 3.11 % Expected term 6 years Expected annual dividend yield is based on the current quarterly dividend of $0.06 per share and the stock price on the grant date. The expected volatility is a historical volatility calculated based on the daily closing prices over a period equal to the expected term. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the grant date. Expected term takes into account the three-year graded vesting term and the 10-year contractual term of the option. The following table presents certain information related to the activity of our non-vested stock option grants: Number of Stock Options Weighted Average Exercise Prices Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding as of December 31, 2019 207,069 $ 18.69 9.00 $ — Granted — — — — Less: Forfeited — — — — Less: Exercised — — — — Outstanding as of March 31, 2020 207,069 $ 18.69 8.75 $ — Vested as of March 31, 2020 35,965 $ 20.94 8.51 $ — Exercisable as of March 31, 2020 35,965 $ 20.94 8.51 $ — |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS On May 5, 2020, our Board of Directors declared a $0.06 per share quarterly cash dividend payable on May 26, 2020, to stockholders of record on May 19, 2020. On May 5, 2020, our shareholders approved the 2020 Omnibus Incentive Plan which adds an additional 2,000,000 shares to our current equity plan. We will continue to monitor the scope, severity and longevity of business shutdowns and economic disruption as a result of the COVID-19 outbreak and the actions government may take to contain or mitigate the spread of the virus or address its impact on individuals, businesses and the economy, which may cause further business disruption, economic uncertainty and market volatility that will impact our business, results of operations and financial condition. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2020 | |
Accounting Policies [Abstract] | |
Income Taxes | (c) Income Taxes On March 27, 2020, the U.S. enacted the Coronavirus Aid, Relief, and Economic Security (CARES) Act to mitigate the economic impacts of the COVID-19 crisis. We are assessing the impact of applying the tax provisions of the CARES Act, and believe it will have a favorable but immaterial impact on our U.S. Federal Tax obligations. |
Pending Accounting Pronouncements | (d) Recently Adopted Accounting Pronouncements In August 2018, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement (ASU 2018-13). This update modifies the existing disclosure requirements on fair value measurements in Topic 820 by changing requirements regarding Level 1, Level 2 and Level 3 investments. ASU 2018-13 is effective for annual reporting periods beginning after December 15, 2019, including interim periods within those annual periods. Entities are permitted to early adopt any removed or modified disclosures of ASU 2018-13 immediately and delay the adoption of the additional disclosures until their effective date. We early adopted the guidance on removed and modified disclosures and adopted the remainder of the guidance on January 1, 2020, which has not impacted the accompanying unaudited condensed consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment (ASU 2017-04). This update simplifies the manner in which an entity is required to test goodwill for impairment by eliminating Step 2 from the goodwill impairment test. ASU 2017-04 is effective for annual periods beginning after December 15, 2019, including interim periods within those annual periods, with early adoption permitted for certain requirements. We intend to adopt this new guidance when we perform our annual assessment of goodwill as of September 30, 2020. In the event that a triggering event occurs and requires an earlier interim assessment, we intend to adopt the updated guidance at that time. Any impact of the standard on our consolidated financial statements and related disclosures will be dependent on market conditions of the reporting units at the time of our assessment and subsequent adoption. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments- Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13). This update is intended to replace the incurred loss impairment methodology in current GAAP with a method that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. ASU 2016-13 will provide users with more useful information regarding the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. In addition, credit losses on available-for-sale debt securities will now have to be presented as an allowance rather than as a write-down. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. We adopted this guidance as of January 1, 2020 using a modified retrospective approach, which allowed us to initially apply the new credit loss guidance at the adoption date and recognize a cumulative effect adjustment to the opening balance of retained earnings for 2020, with no adjustment to prior periods presented.The cumulative effect to the opening balance of retained earnings was a decrease of $262,000 , net of reversals from allowances recorded under prior guidance. (e) Pending Accounting Pronouncements We have evaluated recent accounting pronouncements that have had or may have a significant effect on our financial statements or on our disclosures. In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740) Simplifying the Accounting for Income Taxes (ASU 2019-12). This update enhances and simplifies various aspects of the income tax guidance, including intra-period tax allocation, the methodology for calculating income taxes in an interim period and the recognition of deferred tax liabilities for outside basis differences. ASU 2019-12 is effective for annual reporting periods beginning after December 15, 2020, including interim periods within those fiscal years, with early adoption permitted. We do not intend to early adopt and are assessing the impact of adopting this new accounting standard on our unaudited condensed consolidated financial statements and related disclosures. |
Credit Loss, Financial Instrument | (b) Allowance for Expected Credit Losses We are exposed to credit losses primarily through three different pools of assets based on similar risk characteristics: premiums receivable for direct written business; reinsurance recoverables from ceded losses to our reinsurers; and our note receivable. We estimate the expected credit losses based on historical trends, credit ratings assigned to reinsurers by rating agencies, average default rates, current economic conditions, and reasonable and supportable forecasts of future economic conditions that affect the collectability of the reported amounts over its expected life. Changes in the relevant information may significantly affect the estimates of expected credit losses. The allowance for credit losses is deducted from the amortized cost basis of the assets to present their net carrying value at the amount expected to be collected. Each period, the allowance for credit losses is adjusted through earnings to reflect expected credit losses over the remaining lives of the assets. |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt and Equity Securities, FV-NI | |
Schedule of Available-for-sale Securities Reconciliation | The following table details fixed-maturity available-for-sale securities, by major investment category, at March 31, 2020 and December 31, 2019 : Cost or Adjusted/Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value March 31, 2020 U.S. government and agency securities $ 104,530 $ 5,034 $ 44 $ 109,520 Foreign government 3,721 70 1 3,790 States, municipalities and political subdivisions 126,962 2,885 38 129,809 Public utilities 27,125 479 313 27,291 Corporate securities 285,633 4,087 7,025 282,695 Mortgage-backed securities 255,523 8,872 1,541 262,854 Asset-backed securities 52,181 282 849 51,614 Redeemable preferred stocks 6,890 — 677 6,213 Total fixed maturities $ 862,565 $ 21,709 $ 10,488 $ 873,786 December 31, 2019 U.S. government and agency securities $ 120,260 $ 749 $ 193 $ 120,816 Foreign government 3,975 97 1 4,071 States, municipalities and political subdivisions 131,203 2,611 63 133,751 Public utilities 24,660 700 26 25,334 Corporate securities 281,892 7,123 143 288,872 Mortgage-backed securities 248,206 4,174 477 251,903 Asset-backed securities 56,487 683 41 57,129 Redeemable preferred stocks 2,915 72 2 2,985 Total fixed maturities $ 869,598 $ 16,209 $ 946 $ 884,861 |
Equity Securities Fair Value | Equity securities are summarized as follows: March 31, 2020 December 31, 2019 Estimated Fair Value Percent of Total Estimated Fair Value Percent of Total Mutual funds $ 52,492 46.9 % $ 65,453 56.1 % Public utilities 6,255 5.6 3,663 3.1 Other common stocks 45,801 40.9 44,492 38.2 Nonredeemable preferred stocks 7,367 6.6 3,002 2.6 Total equity securities $ 111,915 100.0 % $ 116,610 100.0 % |
Schedule of Realized Gain (Loss) | The following table details our realized gains (losses) by major investment category for the three months ended March 31, 2020 and 2019 : 2020 2019 Gains (Losses) Fair Value at Sale Gains (Losses) Fair Value at Sale Three Months Ended March 31, Fixed maturities $ 345 $ 59,225 $ 248 $ 6,004 Equity securities 12 280 6 59 Short-term investments — 35 — — Total realized gains 357 59,540 254 6,063 Fixed maturities (337 ) 4,518 (36 ) 9,589 Equity securities (88 ) 953 (37 ) 383 Short-term investments — 128 — — Total realized losses (425 ) 5,599 (73 ) 9,972 Net realized investment gains (losses) $ (68 ) $ 65,139 $ 181 $ 16,035 |
Investments Classified by Contractual Maturity Date | The table below summarizes our fixed maturities at March 31, 2020 by contractual maturity periods. Actual results may differ as issuers may have the right to call or prepay obligations, with or without penalties, prior to the contractual maturities of those obligations. March 31, 2020 Cost or Amortized Cost Percent of Total Fair Value Percent of Total Due in one year or less $ 81,916 9.5 % $ 81,888 9.4 % Due after one year through five years 266,843 30.9 269,289 30.8 Due after five years through ten years 194,258 22.5 196,540 22.5 Due after ten years 11,844 1.4 11,601 1.3 Asset and mortgage backed securities 307,704 35.7 314,468 36.0 Total $ 862,565 100.0 % $ 873,786 100.0 % |
Investment Income | The following table summarizes our net investment income by major investment category: Three Months Ended March 31, 2020 2019 Fixed maturities $ 5,470 $ 6,062 Equity securities 771 492 Cash and cash equivalents 671 135 Other investments 266 768 Other assets 9 88 Investment income 7,187 7,545 Investment expenses (270 ) (250 ) Net investment income $ 6,917 $ 7,295 |
Schedule of Unrealized Loss on Investments | The following table presents an aging of our unrealized investment losses by investment class: Less Than Twelve Months Twelve Months or More Number of Securities (1) Gross Unrealized Losses Fair Value Number of Securities (1) Gross Unrealized Losses Fair Value March 31, 2020 U.S. government and agency securities 3 $ 2 $ 2,467 22 $ 42 $ 13,125 Foreign governments — — — 1 1 350 States, municipalities and political subdivisions 19 38 13,084 — — — Public utilities 31 313 14,960 — — — Corporate securities 300 6,948 134,296 10 77 2,792 Mortgage-backed securities 93 1,304 53,126 10 237 3,904 Asset-backed securities 57 843 23,749 1 6 994 Redeemable preferred stocks 66 677 6,116 — — — Total fixed maturities 569 $ 10,125 $ 247,798 44 $ 363 $ 21,165 December 31, 2019 U.S. government and agency securities 37 $ 89 $ 26,372 39 $ 104 $ 31,364 Foreign governments — — — 2 1 600 States, municipalities and political subdivisions 31 61 14,508 2 2 1,262 Public utilities 9 25 4,626 2 1 250 Corporate securities 42 124 22,435 27 19 9,605 Mortgage-backed securities 89 322 59,101 50 155 12,738 Asset-backed securities 15 34 8,447 5 7 1,259 Redeemable preferred stocks — — — 1 2 97 Total fixed maturities 223 $ 655 $ 135,489 128 $ 291 $ 57,175 (1) This amount represents the actual number of discrete securities, not the number of shares or units of those securities. The numbers are not presented in thousands. |
Schedule of Fair Value of Financial Instruments Measured on a Recurring Basis | The following table presents the fair value of our financial instruments measured on a recurring basis by level at March 31, 2020 and December 31, 2019 : Total Level 1 Level 2 Level 3 March 31, 2020 U.S. government and agency securities $ 109,520 $ — $ 109,520 $ — Foreign government 3,790 — 3,790 — States, municipalities and political subdivisions 129,809 — 129,809 — Public utilities 27,291 — 27,291 — Corporate securities 282,695 — 282,695 — Mortgage-backed securities 262,854 — 262,854 — Asset-backed securities 51,614 — 51,614 — Redeemable preferred stocks 6,213 1,815 4,398 — Total fixed maturities 873,786 1,815 871,971 — Mutual funds 52,492 52,492 — — Public utilities 6,255 6,255 — — Other common stocks 45,801 45,801 — — Non-redeemable preferred stocks 7,367 7,367 — — Total equity securities 111,915 111,915 — — Other investments (1) 1,590 300 1,290 — Total investments $ 987,291 $ 114,030 $ 873,261 $ — December 31, 2019 U.S. government and agency securities $ 120,816 $ — $ 120,816 $ — Foreign government 4,071 — 4,071 — States, municipalities and political subdivisions 133,751 — 133,751 — Public utilities 25,334 — 25,334 — Corporate securities 288,872 — 288,872 — Mortgage-backed securities 251,903 — 251,903 — Asset-backed securities 57,129 — 57,129 — Redeemable preferred stocks 2,985 747 2,238 — Total fixed maturities 884,861 747 884,114 — Mutual Funds 65,453 65,453 — — Public utilities 3,663 3,663 — — Other common stocks 44,492 44,492 — — Non-redeemable preferred stocks 3,002 3,002 — — Total equity securities 116,610 116,610 — — Other investments (1) 499 300 199 — Total investments $ 1,001,970 $ 117,657 $ 884,313 $ — (1) Other investments included in the fair value hierarchy exclude these limited partnership interests that are measured at estimated fair value using the net asset value per share (or its equivalent) practical expedient. |
Schedule of Investments in Limited Partnerships | The information presented in the table below is as of March 31, 2020 : Book Value Unrealized Gain Unrealized Loss Fair Value Limited partnership investments (1) $ 7,746 $ 321 $ 92 $ 7,975 Certificates of deposit 300 — — 300 Short-term investments 1,290 — — 1,290 Total other investments $ 9,336 $ 321 $ 92 $ 9,565 |
Restrictions on Cash and Cash Equivalents | The following table presents the components of restricted assets: March 31, 2020 December 31, 2019 Trust funds $ 63,134 $ 70,668 Cash on deposit (regulatory deposits) 924 920 Total restricted cash $ 64,058 $ 71,588 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The following table shows the computation of basic and diluted EPS for the three-month periods ended March 31, 2020 and 2019 , respectively: Three Months Ended March 31, 2020 2019 Numerator: Net income (loss) attributable to UIHC common stockholders $ (12,723 ) $ 9,469 Denominator: Weighted-average shares outstanding 42,805,527 42,696,681 Effect of dilutive securities — 289,803 Weighted-average diluted shares 42,805,527 42,986,484 Earnings available to UIHC common stockholders per share Basic $ (0.30 ) $ 0.22 Diluted $ (0.30 ) $ 0.22 |
Property and Equipment, Net (Ta
Property and Equipment, Net (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property and Equipment | Property and equipment, net consisted of the following: March 31, December 31, Land $ 2,114 $ 2,114 Building and building improvements (construction in progress of $2,904 and $2,180, respectively) 12,040 11,315 Computer hardware and software (software in progress of $8,805 and $6,317, respectively) 35,722 33,219 Office furniture and equipment 3,234 3,260 Leasehold improvements 94 20 Leased vehicles (1) 1,898 — 1,693 Total, at cost 55,102 51,621 Less: accumulated depreciation and amortization (20,147 ) (18,893 ) Property and equipment, net $ 34,955 $ 32,728 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Goodwill | The following is a summary of intangible assets excluding goodwill recorded as intangible assets on our Unaudited Condensed Consolidated Balance Sheets: March 31, 2020 December 31, 2019 Intangible assets subject to amortization $ 21,303 $ 22,440 Indefinite-lived intangible assets (1) 3,638 3,639 Total $ 24,941 $ 26,079 (1) Indefinite-lived intangible assets are comprised of state insurance and agent licenses, as well as perpetual software licenses. |
Schedule of Acquired Finite-Lived Intangible Assets by Major Class | Intangible assets subject to amortization consisted of the following: Weighted-average remaining amortization period (in years) Gross carrying amount Accumulated amortization Net carrying amount March 31, 2020 Value of business acquired — $ 42,788 $ (42,788 ) $ — Agency agreements acquired 6.7 34,661 (16,593 ) 18,068 Trade names acquired 4.0 6,381 (3,146 ) 3,235 Total $ 83,830 $ (62,527 ) $ 21,303 December 31, 2019 Value of business acquired — $ 42,788 $ (42,788 ) $ — Agency agreements acquired 6.8 34,661 (15,658 ) 19,003 Trade names acquired 4.3 6,381 (2,944 ) 3,437 Total $ 83,830 $ (61,390 ) $ 22,440 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | Estimated amortization expense of our intangible assets to be recognized by the Company during the remainder of 2020 and over the next five years is as follows: Year ending December 31, Estimated Amortization Expense Remaining in 2020 $ 3,130 2021 3,555 2022 3,246 2023 3,246 2024 2,640 2025 2,438 |
Reinsurance (Tables)
Reinsurance (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Reinsurance Disclosures [Abstract] | |
Reinsurance Recoverables | Reinsurance recoverable at the balance sheet dates consists of the following: March 31, December 31, 2020 2019 Reinsurance recoverable on unpaid losses and loss adjustment expenses $ 423,609 $ 482,315 Reinsurance recoverable on paid losses and loss adjustment expenses 90,876 67,821 Reinsurance recoverable $ 514,485 $ 550,136 |
Liability for Unpaid Losses a_2
Liability for Unpaid Losses and Loss Adjustment Expense (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Insurance [Abstract] | |
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | The table below shows the analysis of our reserve for unpaid losses for the three months ended March 31, 2020 and 2019 on a GAAP basis: March 31, 2020 2019 Balance at January 1 $ 760,357 $ 661,203 Less: reinsurance recoverable on unpaid losses 482,315 477,870 Net balance at January 1 $ 278,042 $ 183,333 Incurred related to: Current year 103,966 98,913 Prior years (1,129 ) 5,634 Total incurred $ 102,837 $ 104,547 Paid related to: Current year 30,935 31,215 Prior years 62,511 60,893 Total paid $ 93,446 $ 92,108 Net balance at March 31 $ 287,433 $ 195,772 Plus: reinsurance recoverable on unpaid losses 423,609 434,196 Balance at March 31 $ 711,042 $ 629,968 Composition of reserve for unpaid losses and LAE: Case reserves $ 294,679 $ 258,550 IBNR reserves 416,363 371,418 Balance at March 31 $ 711,042 $ 629,968 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | The table below presents all long-term debt outstanding as of March 31, 2020 and December 31, 2019 : Effective Interest Rate Carrying Value at Maturity March 31, 2020 December 31, 2019 Senior Notes Payable December 15, 2027 6.25% $ 150,000 $ 150,000 Florida State Board of Administration Note Payable July 1, 2026 1.90% 7,353 7,647 BB&T Term Note Payable May 26, 2031 3.31% 3,871 3,958 Total long-term debt $ 161,224 $ 161,605 |
Debt Issuance Cost Rollforward | The table below presents the rollforward of our debt issuance costs paid, in conjunction with the debt instruments described above, during the three months ended March 31, 2020 and 2019: 2020 2019 Balance at January 1, $ 2,672 $ 3,010 Additions — — Amortization (84 ) (84 ) Balance at March 31, $ 2,588 $ 2,926 |
Commitments and Contingencies L
Commitments and Contingencies Leases (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lease, Cost | The components of lease expenses were as follows: Three Months Ended March 31, 2020 March 31, 2019 Operating lease expense $ 127 $ 43 Financing lease expense: Amortization of leased assets 151 56 Short-term lease expense — 77 Net lease expense $ 278 $ 176 |
Schedule of Future Minimum Rental Payments for Operating Leases | At March 31, 2020 , future minimum gross lease payments relating to these non-cancellable operating and finance lease agreements were as follows: Operating Leases Finance Leases Total Remaining in 2020 $ 472 $ 14 $ 486 2021 601 18 619 2022 527 8 535 2023 516 — 516 2024 528 — 528 Thereafter 1,373 — 1,373 Total undiscounted future minimum lease payments 4,017 40 4,057 Less: Imputed interest (1,596 ) (3 ) (1,599 ) Present value of lease liabilities $ 2,421 $ 37 $ 2,458 |
Lease Assets and Liabilities | The classification of operating and finance lease asset and liability balances within the Unaudited Condensed Consolidated Balance Sheets was as follows: Financial Statement Line March 31, 2020 December 31, 2019 Assets Operating lease assets Other assets $ 2,359 $ 335 Financing lease assets Property and equipment, net 1,316 1,263 Total lease assets $ 3,675 1,598 Liabilities Operating lease liabilities Operating lease liability $ 2,421 $ 324 Financing lease liabilities Other liabilities 37 34 Total lease liabilities $ 2,458 $ 358 |
Weighted Average Lease Terms | Weighted average remaining lease term and discount rate related to operating and finance leases were as follows: March 31, 2020 December 31, 2019 Weighted average remaining lease term (months) Operating leases 75 176 Financing leases 27 28 Weighted average discount rate Operating leases 3.56 % 4.00 % Financing leases 3.27 % 3.27 % |
Lease Liability Cash Activity | Other cash and non-cash related activities were as follows: Three Months Ended March 31, 2020 March 31, 2019 Cash paid for amounts included in the measurement of lease liabilities Investing cash flows from financing leases $ 197 361 Right-of-use assets obtained in exchange for new operating lease liabilities 2,136 — Right-of-use assets obtained in exchange for new financing lease liabilities 203 371 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Accumulated Other Comprehensive Income (Loss) | The table below details the components of accumulated other comprehensive income at period end: Pre-Tax Amount Tax (Expense) Benefit Net-of-Tax Amount December 31, 2019 $ 14,962 $ (3,643 ) $ 11,319 Changes in net unrealized gains on investments (3,802 ) 890 (2,912 ) Reclassification adjustment for realized gains 69 17 86 March 31, 2020 $ 11,229 $ (2,736 ) $ 8,493 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Dividends Declared | Our Board of Directors declared dividends on our outstanding shares of common stock to stockholders of record as follows for the periods presented (in thousands, except per share amounts): Three Months Ended March 31, 2020 2019 Per Share Amount Aggregate Amount Per Share Amount Aggregate Amount First Quarter $ 0.06 $ 2,571 $ 0.06 $ 2,569 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation, Stock Options and Stock Appreciation Rights Award Activity | The following table presents certain information related to the activity of our non-vested stock option grants: Number of Stock Options Weighted Average Exercise Prices Weighted Average Remaining Contractual Term (years) Aggregate Intrinsic Value Outstanding as of December 31, 2019 207,069 $ 18.69 9.00 $ — Granted — — — — Less: Forfeited — — — — Less: Exercised — — — — Outstanding as of March 31, 2020 207,069 $ 18.69 8.75 $ — Vested as of March 31, 2020 35,965 $ 20.94 8.51 $ — Exercisable as of March 31, 2020 35,965 $ 20.94 8.51 $ — |
Schedule of Nonvested Share Activity | The following table presents certain information related to the activity of our non-vested common stock grants: Number of Restricted Shares Weighted Average Grant Date Fair Value Outstanding as of December 31, 2019 214,495 $ 17.49 Granted 1,175 8.75 Less: Forfeited 400 16.54 Less: Vested 25,753 16.67 Outstanding as of March 31, 2020 189,517 $ 17.55 |
Share-based Payment Arrangement, Activity | The following table presents our total stock-based compensation expense: Three Months Ended March 31, 2020 2019 Employee stock-based compensation expense Pre-tax $ 526 $ 530 Post-tax (1) 416 419 Director stock-based compensation expense Pre-tax 174 371 Post-tax (1) 137 293 |
Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions | The following weighted-average assumptions were used to value the stock options granted: 2020 Expected annual dividend yield 1.28 % Expected volatility 41.07 % Risk-free interest rate 3.11 % Expected term 6 years |
Organization, Consolidation a_2
Organization, Consolidation and Presentation (Details) | 3 Months Ended |
Mar. 31, 2020subsidiarystatessegment | |
Number of Wholly-Owned Subsidiaries | |
Number of Wholly Owned Subsidiaries | subsidiary | 4 |
Number of Majority Owned Subsidiaries | subsidiary | 1 |
Number of Operating Segments | segment | 1 |
Number of States in which Entity Operates | states | 12 |
Additional Licensed States | states | 6 |
Significant Accounting Polici_3
Significant Accounting Policies Credit Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Credit Loss Allowance Activity | ||
Premium Receivable, Allowance for Credit Loss | $ 126 | $ 165 |
Premium Receivable, Credit Loss Expense (Reversal) | (39) | |
Premium Receivable, Allowance for Credit Loss, Writeoff | 0 | |
Reinsurance Recoverable, Allowance for Credit Loss | 241 | 256 |
Reinsurance Recoverable, Credit Loss Expense (Reversal) | (15) | |
Reinsurance recoverable, allowance for credit loss, writeoff | 0 | |
Financing Receivable, Allowance for Credit Loss | 112 | 141 |
Financing Receivable, Credit Loss, Expense (Reversal) | (29) | |
Financing Receivable, Allowance for Credit Loss, Writeoff | 0 | |
Total Credit Loss Allowances | 479 | $ 562 |
Total Credit Loss Allowance Expense | (83) | |
Total Credit Loss Allowance Writeoffs | $ 0 |
Investments (Details)
Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Schedule of Available-for-sale Securities | ||
Credit Loss Change, Available-for-Sale Investments | $ 0 | $ 0 |
Investments - Schedule of Avail
Investments - Schedule of Available-for-sale Securities Reconciliation (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Schedule of Available-for-sale Securities | ||
Gross unrealized gains | $ 321 | |
Gross unrealized loss | 92 | |
Fair Value | 873,786 | $ 884,861 |
U.S. Government and Agency Securities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 104,530 | 120,260 |
Gross unrealized gains | 5,034 | 749 |
Gross unrealized loss | 44 | 193 |
Fair Value | 109,520 | 120,816 |
Foreign Government | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 3,721 | 3,975 |
Gross unrealized gains | 70 | 97 |
Gross unrealized loss | 1 | 1 |
Fair Value | 3,790 | 4,071 |
States, Municipalities and Political Subdivisions | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 126,962 | 131,203 |
Gross unrealized gains | 2,885 | 2,611 |
Gross unrealized loss | 38 | 63 |
Fair Value | 129,809 | 133,751 |
Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 27,125 | 24,660 |
Gross unrealized gains | 479 | 700 |
Gross unrealized loss | 313 | 26 |
Fair Value | 27,291 | 25,334 |
Corporate Securities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 285,633 | 281,892 |
Gross unrealized gains | 4,087 | 7,123 |
Gross unrealized loss | 7,025 | 143 |
Fair Value | 282,695 | 288,872 |
Mortgage-backed securities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 255,523 | 248,206 |
Gross unrealized gains | 8,872 | 4,174 |
Gross unrealized loss | 1,541 | 477 |
Fair Value | 262,854 | 251,903 |
Asset-backed Securities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 52,181 | 56,487 |
Gross unrealized gains | 282 | 683 |
Gross unrealized loss | 849 | 41 |
Fair Value | 51,614 | 57,129 |
Redeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 6,890 | 2,915 |
Gross unrealized gains | 0 | 72 |
Gross unrealized loss | 677 | 2 |
Fair Value | 6,213 | 2,985 |
Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Cost or adjusted/amortized cost | 862,565 | 869,598 |
Gross unrealized gains | 21,709 | 16,209 |
Gross unrealized loss | 10,488 | 946 |
Fair Value | $ 873,786 | $ 884,861 |
Investments - Schedule of Reali
Investments - Schedule of Realized Gain (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Debt and Equity Securities, Gain (Loss) | ||
Gross realized gains | $ 357 | $ 254 |
Gross realized losses | (425) | (73) |
Net realized gains (losses) | (68) | 181 |
Fair Value at Sale | ||
Fair value at sale | 59,540 | 6,063 |
Fair value at sale | 5,599 | 9,972 |
Net fair value at sale | 65,139 | 16,035 |
Fixed Maturities | ||
Debt and Equity Securities, Gain (Loss) | ||
Gross realized gains | 345 | 248 |
Gross realized losses | (337) | (36) |
Fair Value at Sale | ||
Fair value at sale | 59,225 | 6,004 |
Fair value at sale | 4,518 | 9,589 |
Equity Securities | ||
Debt and Equity Securities, Gain (Loss) | ||
Gross realized gains | 12 | 6 |
Gross realized losses | (88) | (37) |
Fair Value at Sale | ||
Fair value at sale | 280 | 59 |
Fair value at sale | 953 | 383 |
Short-term Investments | ||
Fair Value at Sale | ||
Gross realized losses | 0 | 0 |
Fair value at sale | 128 | 0 |
Gross realized gains | 0 | |
Fair value at sale | $ 35 | $ 0 |
Investments - Investments Class
Investments - Investments Classified by Contractual Maturity Date (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Fair Value | ||
Total | $ 873,786 | $ 884,861 |
Fixed Maturities | ||
Cost or Amortized Cost | ||
Due in one year or less | 81,916 | |
Due after one year through five years | 266,843 | |
Due after five years through ten years | 194,258 | |
Due after ten years | 11,844 | |
Asset and mortgage backed securities | 307,704 | |
Cost or adjusted/amortized cost | $ 862,565 | 869,598 |
Percent of Total | ||
Due in one year or less | 9.50% | |
Due after one year through five years | 30.90% | |
Due after five years through ten years | 22.50% | |
Due after ten years | 1.40% | |
Asset and mortgage backed securities | 35.70% | |
Total | 100.00% | |
Fair Value | ||
Due in one year or less | $ 81,888 | |
Due after one year through five years | 269,289 | |
Due after five years through ten years | 196,540 | |
Due after ten years | 11,601 | |
Asset and mortgage backed securities | 314,468 | |
Total | $ 873,786 | $ 884,861 |
Percent of Total | ||
Due in one year or less | 9.40% | |
Due after one year through five years | 30.80% | |
Due after five years through ten years | 22.50% | |
Due after ten years | 1.30% | |
Asset and mortgage backed securities | 36.00% | |
Total | 100.00% |
Investments - Investment Income
Investments - Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Net Investment Income | ||
Investment income | $ 7,187 | $ 7,545 |
Investment expenses | (270) | (250) |
Net investment income | 6,917 | 7,295 |
Fixed Maturities | ||
Net Investment Income | ||
Investment income | 5,470 | 6,062 |
Equity Securities | ||
Net Investment Income | ||
Investment income | 771 | 492 |
Cash and cash equivalents | ||
Net Investment Income | ||
Investment income | 671 | 135 |
Other Investments | ||
Net Investment Income | ||
Investment income | 266 | 768 |
Other Assets | ||
Net Investment Income | ||
Investment income | $ 9 | $ 88 |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Loss on Investments (Details) $ in Thousands | Mar. 31, 2020USD ($)security | Dec. 31, 2019USD ($)security |
U.S. Government and Agency Securities | ||
Less Than Twelve Months | ||
Number of securities | security | 3 | 37 |
Gross unrealized losses | $ 2 | $ 89 |
Fair value | $ 2,467 | $ 26,372 |
Twelve Months or More | ||
Number of securities | security | 22 | 39 |
Gross unrealized losses | $ 42 | $ 104 |
Fair value | $ 13,125 | $ 31,364 |
States, Municipalities and Political Subdivisions | ||
Less Than Twelve Months | ||
Number of securities | security | 19 | 31 |
Gross unrealized losses | $ 38 | $ 61 |
Fair value | $ 13,084 | $ 14,508 |
Twelve Months or More | ||
Number of securities | security | 0 | 2 |
Gross unrealized losses | $ 0 | $ 2 |
Fair value | $ 0 | $ 1,262 |
Public Utilities | ||
Less Than Twelve Months | ||
Number of securities | security | 31 | 9 |
Gross unrealized losses | $ 313 | $ 25 |
Fair value | $ 14,960 | $ 4,626 |
Twelve Months or More | ||
Number of securities | security | 0 | 2 |
Gross unrealized losses | $ 0 | $ 1 |
Fair value | $ 0 | $ 250 |
Corporate Securities | ||
Less Than Twelve Months | ||
Number of securities | security | 300 | 42 |
Gross unrealized losses | $ 6,948 | $ 124 |
Fair value | $ 134,296 | $ 22,435 |
Twelve Months or More | ||
Number of securities | security | 10 | 27 |
Gross unrealized losses | $ 77 | $ 19 |
Fair value | $ 2,792 | $ 9,605 |
Mortgage-backed securities | ||
Less Than Twelve Months | ||
Number of securities | security | 93 | 89 |
Gross unrealized losses | $ 1,304 | $ 322 |
Fair value | $ 53,126 | $ 59,101 |
Twelve Months or More | ||
Number of securities | security | 10 | 50 |
Gross unrealized losses | $ 237 | $ 155 |
Fair value | $ 3,904 | $ 12,738 |
Asset-backed Securities | ||
Less Than Twelve Months | ||
Number of securities | security | 57 | 15 |
Gross unrealized losses | $ 843 | $ 34 |
Fair value | $ 23,749 | $ 8,447 |
Twelve Months or More | ||
Number of securities | security | 1 | 5 |
Gross unrealized losses | $ 6 | $ 7 |
Fair value | $ 994 | $ 1,259 |
Redeemable Preferred Stocks | ||
Less Than Twelve Months | ||
Number of securities | security | 66 | 0 |
Gross unrealized losses | $ 677 | $ 0 |
Fair value | $ 6,116 | $ 0 |
Twelve Months or More | ||
Number of securities | security | 0 | 1 |
Gross unrealized losses | $ 0 | $ 2 |
Fair value | $ 0 | $ 97 |
Fixed Maturities | ||
Less Than Twelve Months | ||
Number of securities | security | 569 | 223 |
Gross unrealized losses | $ 10,125 | $ 655 |
Fair value | $ 247,798 | $ 135,489 |
Twelve Months or More | ||
Number of securities | security | 44 | 128 |
Gross unrealized losses | $ 363 | $ 291 |
Fair value | $ 21,165 | $ 57,175 |
Foreign Government | ||
Less Than Twelve Months | ||
Number of securities | security | 0 | 0 |
Gross unrealized losses | $ 0 | $ 0 |
Fair value | $ 0 | $ 0 |
Twelve Months or More | ||
Number of securities | security | 1 | 2 |
Gross unrealized losses | $ 1 | $ 1 |
Fair value | $ 350 | $ 600 |
Investments - Schedule of Fair
Investments - Schedule of Fair Value of Financial Instruments Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Schedule of Available-for-sale Securities | ||
Investment Owned, at Fair Value | $ 987,291 | $ 1,001,970 |
U.S. Government and Agency Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 109,520 | 120,816 |
Foreign Government | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 3,790 | 4,071 |
States, Municipalities and Political Subdivisions | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 129,809 | 133,751 |
Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 27,291 | 25,334 |
Corporate Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 282,695 | 288,872 |
Mortgage-backed securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 262,854 | 251,903 |
Asset-backed Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 51,614 | 57,129 |
Redeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 6,213 | 2,985 |
Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 873,786 | 884,861 |
Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 6,255 | 3,663 |
Common Stock | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 45,801 | 44,492 |
Nonredeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 7,367 | 3,002 |
Equity Securities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 111,915 | 116,610 |
Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Other Investments | 1,590 | 499 |
Mutual Fund | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 52,492 | 65,453 |
Level 1 | ||
Schedule of Available-for-sale Securities | ||
Investment Owned, at Fair Value | 114,030 | 117,657 |
Level 1 | U.S. Government and Agency Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Foreign Government | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | States, Municipalities and Political Subdivisions | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Corporate Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Mortgage-backed securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Asset-backed Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 1 | Redeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 1,815 | 747 |
Level 1 | Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 1,815 | 747 |
Level 1 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 6,255 | 3,663 |
Level 1 | Common Stock | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 45,801 | 44,492 |
Level 1 | Nonredeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 7,367 | 3,002 |
Level 1 | Equity Securities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 111,915 | 116,610 |
Level 1 | Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Other Investments | 300 | 300 |
Level 1 | Mutual Fund | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 52,492 | 65,453 |
Level 2 | ||
Schedule of Available-for-sale Securities | ||
Investment Owned, at Fair Value | 873,261 | 884,313 |
Level 2 | U.S. Government and Agency Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 109,520 | 120,816 |
Level 2 | Foreign Government | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 3,790 | 4,071 |
Level 2 | States, Municipalities and Political Subdivisions | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 129,809 | 133,751 |
Level 2 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 27,291 | 25,334 |
Level 2 | Corporate Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 282,695 | 288,872 |
Level 2 | Mortgage-backed securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 262,854 | 251,903 |
Level 2 | Asset-backed Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 51,614 | 57,129 |
Level 2 | Redeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 4,398 | 2,238 |
Level 2 | Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 871,971 | 884,114 |
Level 2 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 2 | Common Stock | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 2 | Nonredeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 2 | Equity Securities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 2 | Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Other Investments | 1,290 | 199 |
Level 2 | Mutual Fund | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 3 | ||
Schedule of Available-for-sale Securities | ||
Investment Owned, at Fair Value | 0 | 0 |
Level 3 | U.S. Government and Agency Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Foreign Government | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | States, Municipalities and Political Subdivisions | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Corporate Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Mortgage-backed securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Asset-backed Securities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Redeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Fixed Maturities | ||
Schedule of Available-for-sale Securities | ||
Available-for-sale Securities | 0 | 0 |
Level 3 | Public Utilities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 3 | Common Stock | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 3 | Nonredeemable Preferred Stocks | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 3 | Equity Securities | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | 0 | 0 |
Level 3 | Other Long-term Investments | ||
Schedule of Available-for-sale Securities | ||
Other Investments | 0 | 0 |
Level 3 | Mutual Fund | ||
Schedule of Available-for-sale Securities | ||
Equity securities, fair value | $ 0 | $ 0 |
Investments - Schedule of Other
Investments - Schedule of Other Investments (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Other Investments | |
Other investments, cost | $ 9,336 |
Unrealized Loss | (92) |
Unrealized Gain | 321 |
Total other investments | 9,565 |
Certificates of Deposit | |
Other Investments | |
Other investments, cost | 300 |
Unrealized Loss | 0 |
Unrealized Gain | 0 |
Fair value - certificates of deposit | 300 |
Limited Partnership | |
Other Investments | |
Other investments, cost | 7,746 |
Unrealized Loss | (92) |
Unrealized Gain | 321 |
Fair value - partnerships | 7,975 |
Short-term Investments | |
Other Investments | |
Other investments, cost | 1,290 |
Unrealized Loss | 0 |
Unrealized Gain | 0 |
Fair Value - short term investments | $ 1,290 |
Investments - Equity Securities
Investments - Equity Securities, FV-NI (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Mutual Fund | ||
Debt and Equity Securities, FV-NI | ||
Fair value | $ 52,492 | $ 65,453 |
Percent of Total | 46.90% | 56.10% |
Public Utilities | ||
Debt and Equity Securities, FV-NI | ||
Percent of Total | 5.60% | 3.10% |
Common Stock | ||
Debt and Equity Securities, FV-NI | ||
Fair value | $ 45,801 | $ 44,492 |
Percent of Total | 40.90% | 38.20% |
Nonredeemable Preferred Stocks | ||
Debt and Equity Securities, FV-NI | ||
Fair value | $ 7,367 | $ 3,002 |
Percent of Total | 6.60% | 2.60% |
Equity Securities | ||
Debt and Equity Securities, FV-NI | ||
Fair value | $ 111,915 | $ 116,610 |
Percent of Total | 100.00% | 100.00% |
Investments - Restricted Cash (
Investments - Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Restricted Cash and Cash Equivalents Items | ||
Assets Held-in-trust | $ 63,134 | $ 70,668 |
Regulatory Assets | 924 | 920 |
Restricted Cash | $ 64,058 | $ 71,588 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Earnings per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Numerator | ||
Net income attributable to UIHC common stockholders | $ (12,723) | $ 9,469 |
Denominator | ||
Weighted-average shares outstanding | 42,805,527 | 42,696,681 |
Effect of dilutive securities | 0 | 289,803 |
Weighted-average diluted shares | 42,805,527 | 42,986,484 |
Basic earnings per share | $ (0.30) | $ 0.22 |
Diluted earnings per share | $ (0.30) | $ 0.22 |
Property and Equipment, Net (De
Property and Equipment, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Property, Plant and Equipment [Abstract] | |||
Depreciation and amortization expense | $ 1,287 | $ 870 | |
Software in progress | 8,805 | $ 6,317 | |
Construction in Progress | $ 2,904 | $ 2,180 |
Property and Equipment, Net - S
Property and Equipment, Net - Schedule of Property and Equipment (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment | ||
Total, at cost | $ 55,102 | $ 51,621 |
Less: Accumulated Depreciation and Amortization, Property, Plant, and Equipment | (20,147) | (18,893) |
Property, Plant and Equipment, Net | 34,955 | 32,728 |
Building | ||
Property, Plant and Equipment | ||
Total, at cost | 12,040 | 11,315 |
Land | ||
Property, Plant and Equipment | ||
Total, at cost | 2,114 | 2,114 |
Office Equipment | ||
Property, Plant and Equipment | ||
Total, at cost | 3,234 | 3,260 |
Computer Equipment | ||
Property, Plant and Equipment | ||
Total, at cost | 35,722 | 33,219 |
Leasehold Improvements | ||
Property, Plant and Equipment | ||
Total, at cost | 94 | 20 |
Vehicles | ||
Property, Plant and Equipment | ||
Total, at cost | $ 1,898 | $ 1,693 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization of Intangible Assets | $ 1,137 | $ 1,365 | |
Goodwill | $ 73,045 | $ 73,045 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2019 | |
Acquired Finite-Lived Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | $ 83,830 | $ 83,830 |
Finite-Lived Intangible Assets, Accumulated Amortization | (62,527) | (61,390) |
Finite-Lived Intangible Assets, Net | 21,303 | 22,440 |
Value of Business Acquired | ||
Acquired Finite-Lived Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | 42,788 | 42,788 |
Finite-Lived Intangible Assets, Accumulated Amortization | (42,788) | (42,788) |
Finite-Lived Intangible Assets, Net | 0 | 0 |
Customer Relationships | ||
Acquired Finite-Lived Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | 34,661 | 34,661 |
Finite-Lived Intangible Assets, Accumulated Amortization | (16,593) | (15,658) |
Finite-Lived Intangible Assets, Net | $ 18,068 | $ 19,003 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 6 years 8 months | 6 years 10 months |
Trade Names | ||
Acquired Finite-Lived Intangible Assets | ||
Finite-Lived Intangible Assets, Gross | $ 6,381 | $ 6,381 |
Finite-Lived Intangible Assets, Accumulated Amortization | (3,146) | (2,944) |
Finite-Lived Intangible Assets, Net | $ 3,235 | $ 3,437 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years | 4 years 4 months |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Future Amortization Expense (Details) $ in Thousands | Mar. 31, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Finite-Lived Intangible Asset, Expected Amortization, Remainder of Fiscal Year | $ 3,130 |
Finite-Lived Intangible Asset, Expected Amortization, Year One | 3,555 |
Finite-Lived Intangible Asset, Expected Amortization, Year Three | 3,246 |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 3,246 |
Finite-Lived Intangible Asset, Expected Amortization, Year Four | 2,640 |
Finite-Lived Intangible Asset, Expected Amortization, Year Five | $ 2,438 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Reconciliation (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Indefinite-lived Intangible Assets (Excluding Goodwill) | $ 3,638 | $ 3,639 |
Finite-Lived Intangible Assets, Net | 21,303 | 22,440 |
Intangible Assets, Net (Excluding Goodwill) | $ 24,941 | $ 26,079 |
Reinsurance (Details)
Reinsurance (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Reinsurance Retention Policy | ||
Amount of risk reinsured in excess of stated retention | $ 3,200,000,000 | |
Flood premiums ceded (percentage) | 100.00% | |
Insurance commissions and fees under Flood Program | $ 333,000 | $ 342,000 |
Reinsurance Recoverables (Detai
Reinsurance Recoverables (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Reinsurance Recoverable | ||||
Reinsurance Recoverable for Unpaid Claims and Claims Adjustments | $ 423,609 | $ 482,315 | $ 434,196 | $ 477,870 |
Reinsurance Recoverable for Paid Claims and Claims Adjustments | 90,876 | 67,821 | ||
Reinsurance Recoverable for Paid and Unpaid Claims and Claims Adjustments | $ 514,485 | $ 550,136 |
Liability for Unpaid Losses a_3
Liability for Unpaid Losses and Loss Adjustment Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | |
Liability for Unpaid Claims and Claims Adjustment Expense | ||||
Unpaid losses and loss adjustment expenses | $ 711,042 | $ 629,968 | $ 760,357 | $ 661,203 |
Reinsurance Recoverable for Unpaid Claims and Claims Adjustments | 423,609 | 434,196 | 482,315 | 477,870 |
Liability for Unpaid Claims and Claims Adjustment Expense, Net | 287,433 | 195,772 | $ 278,042 | $ 183,333 |
Current Year Claims and Claims Adjustment Expense | 103,966 | 98,913 | ||
Prior Year Claims and Claims Adjustment Expense | (1,129) | 5,634 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Incurred Claims | 102,837 | 104,547 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid, Current Year | 30,935 | 31,215 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid, Prior Years | 62,511 | 60,893 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Claims Paid | 93,446 | 92,108 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Reported Claims, Amount | 294,679 | 258,550 | ||
Liability for Unpaid Claims and Claims Adjustment Expense, Incurred but Not Reported (IBNR) Claims, Amount | $ 416,363 | $ 371,418 |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) $ in Thousands | Dec. 13, 2017 | May 26, 2016 | Sep. 22, 2006 | Mar. 31, 2020 | Dec. 31, 2019 |
Debt Instrument | |||||
Notes Payable | $ 158,636 | $ 158,932 | |||
BB&T Term Note Payable | |||||
Debt Instrument | |||||
Notes Payable | $ 5,200 | ||||
Interest rate (percentage) | 1.65% | ||||
Debt Instrument, Term | 15 years | ||||
Florida State Board of Administration | |||||
Debt Instrument | |||||
Notes Payable | $ 20,000 | ||||
Interest rate (percentage) | 1.90% | ||||
Debt Instrument, Term | 20 years | ||||
150M Senior Notes | |||||
Debt Instrument | |||||
Notes Payable | $ 150,000 | ||||
Interest rate (percentage) | 6.25% | ||||
Debt Instrument, Term | 10 years |
Schedule of Long-Term Debt (Det
Schedule of Long-Term Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2020 | Dec. 31, 2019 | Dec. 13, 2017 | May 26, 2016 | |
Debt Instrument | ||||
Long-term Debt, Fair Value | $ 161,224 | $ 161,605 | ||
150M Senior Notes | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | Dec. 15, 2027 | |||
Interest rate (percentage) | 6.25% | |||
Debt Instrument, Interest Rate, Effective Percentage | 6.25% | |||
Long-term Debt, Fair Value | $ 150,000 | 150,000 | ||
BB&T Term Note Payable | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | May 26, 2031 | |||
Interest rate (percentage) | 1.65% | |||
Debt Instrument, Interest Rate, Effective Percentage | 3.31% | |||
Long-term Debt, Fair Value | $ 3,871 | 3,958 | ||
Florida State Board of Administration | ||||
Debt Instrument | ||||
Debt Instrument, Maturity Date | Jul. 1, 2026 | |||
Interest rate (percentage) | 1.90% | |||
Long-term Debt, Fair Value | $ 7,353 | $ 7,647 |
Debt Issuance Cost Rollforward
Debt Issuance Cost Rollforward (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 | Mar. 31, 2019 | Dec. 31, 2018 |
Debt Disclosure [Abstract] | ||||
Debt Issuance Costs, Gross | $ 0 | $ 0 | ||
Accumulated Amortization, Debt Issuance Costs | (84) | (84) | ||
Debt Issuance Costs, Net | $ 2,588 | $ 2,672 | $ 2,926 | $ 3,010 |
Commitments and Contingencies_2
Commitments and Contingencies Lease Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Lease Costs | ||
Lease, Cost | $ 278 | $ 176 |
Short-term Lease, Cost | 0 | 77 |
Finance Lease, Right-of-Use Asset, Amortization | 151 | 56 |
Operating Lease, Expense | $ 127 | $ 43 |
Commitments and Contingencies_3
Commitments and Contingencies Lease Assets and Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Lessee, Lease, Description | ||
Operating Lease, Right-of-Use Asset | $ 2,359 | $ 335 |
Finance Lease, Right-of-Use Asset, after Accumulated Amortization | 1,316 | 1,263 |
Total Lease Assets | 3,675 | 1,598 |
Operating Lease, Liability | 2,421 | 324 |
Finance Lease, Liability | 37 | 34 |
Total Lease Liability | $ 2,458 | $ 358 |
Commitments and Contingencies W
Commitments and Contingencies Weighted Average Lease Terms (Details) | Mar. 31, 2020Rate | Dec. 31, 2019Rate |
Weighted Average Terms | ||
Operating Lease, Weighted Average Discount Rate, Percent | 3.56% | 4.00% |
Operating Lease, Weighted Average Remaining Lease Term | 6 years 3 months | 14 years 8 months |
Finance Lease, Weighted Average Discount Rate, Percent | 3.27% | 3.27% |
Finance Lease, Weighted Average Remaining Lease Term | 2 years 3 months | 2 years 4 months |
Commitments and Contingencies S
Commitments and Contingencies Schedule of Future Minimum Rental Payments (Details) - USD ($) $ in Thousands | Mar. 31, 2020 | Dec. 31, 2019 |
Schedule of Future Minimum Rental Payments | ||
Operating Leases, Future Minimum Payments, Remainder of Year | $ 472 | |
Operating Leases, Future Minimum Payments Due, Next Twelve Months | 601 | |
Operating Leases, Future Minimum Payments, Due in Two Years | 527 | |
Operating Leases, Future Minimum Payments, Due in Three Years | 516 | |
Operating Leases, Future Minimum Payments, Due in Four Years | 528 | |
Operating Leases, Future Minimum Payments, Due Thereafter | 1,373 | |
Operating Leases, Future Minimum Payments Due | 4,017 | |
Lessee, Operating Lease, Liability, Undiscounted Excess Amount | 1,596 | |
Operating Lease, Liability | 2,421 | $ 324 |
Finance Lease, Liability, to be Paid, Remainder of Year | 14 | |
Finance Lease, Liability, to be Paid, Year One | 18 | |
Finance Lease, Liability, to be Paid, Year Two | 8 | |
Finance Lease, Liability, to be Paid, Year Three | 0 | |
Finance Lease, Liability, to be Paid, Year Four | 0 | |
Finance Lease, Liability, to be Paid, after Year Five | 0 | |
Finance Lease, Liability, Payment, Due | 40 | |
Finance Lease, Liability, Undiscounted Excess Amount | (3) | |
Finance Lease, Liability | 37 | 34 |
Total Lease Future Payments Remainder of Year | 486 | |
Total Lease Future Payments Year 1 | 619 | |
Total Lease Future Payments Year 2 | 535 | |
Total Lease Future Payments Year 3 | 516 | |
Total Lease Future Payments Year 4 | 528 | |
Total Lease Future Payments Thereafter | 1,373 | |
Total Lease Future Payments | 4,057 | |
Total Lease Liability Undiscounted Excess Amount | (1,599) | |
Total Lease Liability | $ 2,458 | $ 358 |
Commitments and Contingencies_4
Commitments and Contingencies Lease Liabilities Cash Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Financing Lease Liability Activity | ||
Finance Lease, Principal Payments | $ 197 | $ 361 |
Right-of-Use Asset Obtained in Exchange for Operating Lease Liability | 2,136 | 0 |
Right-of-Use Asset Obtained in Exchange for Finance Lease Liability | $ 203 | $ 371 |
Commitments and Contingencies N
Commitments and Contingencies Narrative (Details) - USD ($) | Mar. 31, 2020 | Dec. 31, 2019 |
Commitments and Contingencies Disclosure [Abstract] | ||
Partnership unfunded commitments | $ 2,161,000 | $ 2,201,000 |
Statutory Accounting and Regu_2
Statutory Accounting and Regulation (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Insurance [Abstract] | |||
Statutory net income (loss) | $ 7,208 | $ 7,735 | |
Statutory capital and surplus balance | $ 403,913 | $ 415,948 |
Related Party Transactions (Det
Related Party Transactions (Details) - Director $ in Thousands | 3 Months Ended |
Mar. 31, 2019USD ($) | |
AmRisc gross written premiums | |
Related Party Transaction | |
Amounts of Transactions | $ 107,619 |
AmRisc Fees and Commission | |
Related Party Transaction | |
Amounts of Transactions | 28,979 |
AmRisc ceded premiums written | |
Related Party Transaction | |
Amounts of Transactions | $ 1,545 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Accumulated Other Comprehensive Income (Loss) | |||
AOCI before Tax, Attributable to Parent | $ 11,229 | $ 14,962 | |
AOCI Tax, Attributable to Parent | (2,736) | (3,643) | |
Accumulated Other Comprehensive Income (Loss), Net of Tax | 8,493 | $ 11,319 | |
Change in net unrealized gains (losses) on investments | (4,110) | $ 14,322 | |
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax | (68) | $ 181 | |
Consolidated Entity Excluding Noncontrolling Interests | |||
Accumulated Other Comprehensive Income (Loss) | |||
Change in net unrealized gains (losses) on investments | (3,802) | ||
Other Comprehensive Income (Loss), Unrealized Gain (Loss) on Derivatives Arising During Period, Tax | 890 | ||
OCI, Debt Securities, Available-for-Sale, Unrealized Holding Gain (Loss), before Adjustment, after Tax | (2,912) | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, before Tax | 69 | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Tax | 17 | ||
Other Comprehensive Income (Loss), Reclassification Adjustment from AOCI for Sale of Securities, Net of Tax | $ 86 |
Schedule of Dividends Declared
Schedule of Dividends Declared (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Class of Stock | ||
Dividends declared per share (in usd per share) | $ 0.06 | $ 0.06 |
Aggregate amount of dividends | $ 2,571 | $ 2,569 |
Stockholders' Equity Narrative
Stockholders' Equity Narrative (Details) | Mar. 31, 2020USD ($) |
Stockholders' Equity Narrative [Abstract] | |
Stock Repurchase Program, Authorized Amount | $ 25,000,000 |
Stock-Based Compensation - Stoc
Stock-Based Compensation - Stock-based Compensation Expense (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2020USD ($)year | Mar. 31, 2019USD ($) | |
Employee | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Unrecognized Stock Compensation Expense | $ 3,037 | |
Weighted average remaining expense period | year | 1.7 | |
Post-Tax Expense | $ 416 | $ 419 |
Pre-Tax Expense | 526 | 530 |
Director | ||
Share-based Compensation Arrangement by Share-based Payment Award | ||
Unrecognized Stock Compensation Expense | $ 72 | |
Weighted average remaining expense period | year | 0.1 | |
Post-Tax Expense | $ 137 | 293 |
Pre-Tax Expense | $ 174 | $ 371 |
Stock-Based Compensation - Non-
Stock-Based Compensation - Non-Vested Common Stock Grants (Details) - Restricted Stock - $ / shares | 3 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Dec. 31, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award | |||
Granted shares | 1,175 | 22,052 | |
Less: Forfeited shares | 400 | ||
Less: Vested shares | 25,753 | ||
Outstanding shares | 189,517 | 214,495 | |
Granted (fair value) | $ 8.75 | $ 16.54 | |
Less: Forfeited (fair value) | 16.54 | ||
Less: Vested (fair value) | 16.67 | ||
Outstanding (fair value) | $ 17.55 | $ 17.49 |
Stock-Based Compensation - Weig
Stock-Based Compensation - Weighted-Average Assumptions - Stock Options (Details) | 3 Months Ended |
Mar. 31, 2020Rate | |
Share-based Compensation Arrangement by Share-based Payment Award | |
Expected annual dividend yield | 1.28% |
Expected volatility | 41.07% |
Risk-free interest rate | 3.11% |
Expected term | 6 |
Stock-Based Compensation - No_2
Stock-Based Compensation - Non-Vested Stock Options (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Dec. 31, 2019 | |
Share-based Payment Arrangement, Option, Exercise Price Range | ||
Granted shares | 0 | |
Less: Forfeited shares | 0 | |
Outstanding shares | 207,069 | 207,069 |
Vested Shares | 35,965 | |
Exercisable shares | 35,965 | |
Granted (Weighted-Average Exercise) | $ 0 | |
Less: Forfeited (Weighted-Average Exercise) | 0 | |
Less: Exercised, (Weighted Average Exercise Price) | 0 | |
Outstanding (Weight-Average Exercise) | 18.69 | $ 18.69 |
Vested (Weighted-Average Exercise) | 20.94 | |
Exercisable (Weighted-Average Exercise) | $ 20.94 | |
Outstanding Options, weighted average remaining contractual term | 8 years 9 months | 9 years |
Vested weighted average remaining contractual term | 8 years 6 months | |
Exercisable weighted average remaining contractual term | 8 years 6 months | |
Granted Options, Intrinsic Value | $ 0 | |
Forfeited Options, Intrinsic Value | $ 0 | |
Exercised Options, Intrinsic Value | $ 0 | |
Outstanding Options, Intrinsic Value | 0 | $ 0 |
Vested Options, Intrinsic value | 0 | |
Exercisable Options, Intrinsic Value | $ 0 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) | May 26, 2020 | Mar. 31, 2020 | Mar. 31, 2019 | May 05, 2020 |
Subsequent Event | ||||
Dividends declared per share (in usd per share) | $ 0.06 | $ 0.06 | ||
Stock Repurchase Program, Authorized Amount | $ 25,000,000 | |||
Subsequent Event | ||||
Subsequent Event | ||||
Dividends declared per share (in usd per share) | $ 0.06 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 2,000,000 |