Cover
Cover - shares | 3 Months Ended | |
Mar. 31, 2023 | May 04, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-41591 | |
Entity Registrant Name | SKYWARD SPECIALTY INSURANCE GROUP, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 14-1957288 | |
Entity Address, Address Line One | 800 Gessner Road | |
Entity Address, Address Line Two | Suite 600 | |
Entity Address, City or Town | Houston | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 77024-4284 | |
City Area Code | 713 | |
Local Phone Number | 935-4800 | |
Title of 12(b) Security | Common stock, par value $0.01 | |
Trading Symbol | SKWD | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 37,658,111 | |
Entity Central Index Key | 0001519449 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Investments: | ||
Fixed maturity securities, available-for-sale, at fair value (amortized cost of $718,395 and $662,616, respectively) | $ 673,137 | $ 607,572 |
Fixed maturity securities, held-to-maturity, at amortized cost (net of allowance for credit losses of $321 as of March 31, 2023) | 48,216 | 52,467 |
Equity securities, at fair value | 120,465 | 120,169 |
Mortgage loans (at fair value as of March 31, 2023; at amortized cost as of December 31, 2022) | 42,335 | 51,859 |
Other long-term investments | 118,784 | 129,142 |
Short-term investments, at fair value | 287,351 | 121,158 |
Total investments | 1,290,288 | 1,082,367 |
Cash and cash equivalents | 41,200 | 45,438 |
Restricted cash | 64,047 | 79,573 |
Premiums receivable, net | 178,954 | 139,215 |
Reinsurance recoverables, net | 570,504 | 581,359 |
Ceded unearned premium | 197,044 | 157,645 |
Deferred policy acquisition costs | 80,103 | 68,938 |
Deferred income taxes | 30,572 | 36,188 |
Goodwill and intangible assets, net | 89,503 | 89,870 |
Other assets | 79,110 | 82,846 |
Total assets | 2,621,325 | 2,363,439 |
Liabilities: | ||
Reserves for losses and loss adjustment expenses | 1,173,176 | 1,141,757 |
Unearned premiums | 501,218 | 442,509 |
Deferred ceding commission | 40,824 | 29,849 |
Reinsurance and premium payables | 185,748 | 113,696 |
Funds held for others | 44,256 | 36,858 |
Accounts payable and accrued liabilities | 40,328 | 48,499 |
Notes payable | 50,000 | 50,000 |
Subordinated debt, net of debt issuance costs | 78,629 | 78,609 |
Total liabilities | 2,114,179 | 1,941,777 |
Stockholders’ equity | ||
Series A preferred stock, $0.01 par value; 10,000,000 and 2,000,000 shares authorized, 0 and 1,969,660 shares issued and outstanding, respectively | 0 | 20 |
Common stock, $0.01 par value, 500,000,000 and 168,000,000 shares authorized, 37,658,111 and 16,832,955 shares issued, respectively | 377 | 168 |
Treasury stock, $0.01 par value, 0 and 233,289 shares, respectively | 0 | (2) |
Additional paid-in capital | 641,368 | 577,289 |
Stock notes receivable | (6,718) | (6,911) |
Accumulated other comprehensive loss | (35,744) | (43,485) |
Accumulated deficit | (92,137) | (105,417) |
Total stockholders’ equity | 507,146 | 421,662 |
Total liabilities and stockholders’ equity | $ 2,621,325 | $ 2,363,439 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Amortized cost | $ 718,395 | $ 662,616 |
Allowance for credit losses | $ 321 | |
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 2,000,000 |
Preferred stock, shares issued (in shares) | 0 | 1,969,660 |
Preferred stock, shares outstanding (in shares) | 0 | 1,969,660 |
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 168,000,000 |
Common stock, shares issued (in shares) | 37,658,111 | 16,832,955 |
Treasury stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Treasury stock (in shares) | 0 | 233,289 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenues: | ||
Net earned premiums | $ 182,831 | $ 141,726 |
Commission and fee income | 1,492 | 230 |
Net investment income | 4,646 | 15,149 |
Net investment gains (losses) | 961 | (4,438) |
Total revenues | 189,930 | 152,667 |
Expenses: | ||
Losses and loss adjustment expenses | 114,900 | 89,989 |
Underwriting, acquisition and insurance expenses | 51,655 | 40,534 |
Interest expense | 2,152 | 1,177 |
Amortization expense | 387 | 387 |
Other expenses | 1,114 | 0 |
Total expenses | 170,208 | 132,087 |
Income before income taxes | 19,722 | 20,580 |
Income tax expense | 4,166 | 4,269 |
Net income | 15,556 | 16,311 |
Net income attributable to participating securities | 1,274 | 7,823 |
Net income attributable to common shareholders | 14,282 | 8,488 |
Comprehensive income (loss): | ||
Net income | 15,556 | 16,311 |
Unrealized gains and losses on investments: | ||
Net change in unrealized gains (losses) on investments, net of tax | 7,788 | (16,705) |
Reclassification adjustment for (losses) gains on securities no longer held, net of tax | (47) | 301 |
Total other comprehensive income (loss) | 7,741 | (16,404) |
Comprehensive income (loss) | $ 23,297 | $ (93) |
Per share data: | ||
Basic earnings per share (in dollar per share) | $ 0.43 | $ 0.52 |
Diluted earnings per share (in dollar per share) | $ 0.42 | $ 0.50 |
Weighted-average common shares outstanding | ||
Basic (in shares) | 32,848,243 | 16,376,720 |
Diluted (in shares) | 36,952,073 | 32,412,307 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Changes in Stockholders' Equity (Unaudited) - USD ($) $ in Thousands | Total | Period of adoption, adjustment | Preferred Stock | Common Stock | Treasury Stock | Additional Paid-in Capital | Stock Notes Receivable | Accumulated Other Comprehensive Loss | Accumulated Deficit | Accumulated Deficit Period of adoption, adjustment |
Stockholders' equity beginning balance at Dec. 31, 2021 | $ 426,080 | $ 20 | $ 168 | $ (2) | $ 575,159 | $ (9,092) | $ 4,640 | $ (144,813) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Employee equity transactions | 690 | 502 | 188 | |||||||
Reclassification of stock notes receivable to other assets | 1,942 | 1,942 | ||||||||
Net income | 16,311 | 16,311 | ||||||||
Other comprehensive income, net of tax | (16,404) | (16,404) | ||||||||
Stockholders' equity ending balance at Mar. 31, 2022 | 428,619 | 20 | 168 | (2) | 575,661 | (6,962) | (11,764) | (128,502) | ||
Stockholders' equity beginning balance at Dec. 31, 2021 | 426,080 | 20 | 168 | (2) | 575,159 | (9,092) | 4,640 | (144,813) | ||
Stockholders' equity ending balance at Dec. 31, 2022 | $ 421,662 | 20 | 168 | (2) | 577,289 | (6,911) | (43,485) | (105,417) | $ (2,300) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-13 [Member] | |||||||||
Employee equity transactions | $ 2,057 | 1,864 | 193 | |||||||
Preferred stock conversion to common shares | 0 | (20) | 161 | 2 | (143) | |||||
Proceeds from initial public offering, net | 62,406 | 48 | 62,358 | |||||||
Net income | 15,556 | 15,556 | ||||||||
Other comprehensive income, net of tax | 7,741 | 7,741 | ||||||||
Stockholders' equity ending balance at Mar. 31, 2023 | $ 507,146 | $ (2,276) | $ 0 | $ 377 | $ 0 | $ 641,368 | $ (6,718) | $ (35,744) | $ (92,137) | $ (2,276) |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows(Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities | ||
Net income | $ 15,556 | $ 16,311 |
Adjustments to reconcile net income to net cash provided by operating activities | 91,651 | 29,571 |
Net cash provided by operating activities | 107,207 | 45,882 |
Cash flows from investing activities: | ||
Purchase of fixed maturity securities, available-for-sale | (72,466) | (23,370) |
Purchase of illiquid investments | (286) | (2,376) |
Purchase of equity securities | (12,889) | (25,221) |
Proceeds from (investment in) direct and indirect loans | 14,665 | (8,019) |
Purchase of property and equipment | (614) | (431) |
Sales and maturities of investment securities | 34,980 | 33,935 |
Distributions from equity method investments | 355 | 1,326 |
Change in short-term investments | (166,193) | (38,631) |
Receivable for securities sold | 3,984 | 5,671 |
Cash provided by deposit accounting | 5,038 | 1,518 |
Other, net | 0 | 2 |
Net cash used in investment activities | (193,426) | (55,596) |
Cash flows from financing activities: | ||
Repayment of stock notes receivable | 193 | 186 |
Draw on revolving line of credit | 50,000 | 0 |
Repayment of term loan | (50,000) | 0 |
Proceeds from initial public offering | 66,262 | 0 |
Net cash provided by financing activities | 66,455 | 186 |
Net decrease in cash and cash equivalents and restricted cash | (19,764) | (9,528) |
Cash and cash equivalents and restricted cash at beginning of period | 125,011 | 107,274 |
Cash and cash equivalents and restricted cash at end of period | 105,247 | 97,746 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | $ 3,145 | $ 1,124 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The unaudited condensed consolidated financial statements of Skyward Specialty Insurance Group, Inc. (the “Company”) have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America for interim financial reporting and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all the disclosures required by GAAP for complete consolidated financial statements. Readers are urged to review the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 for a more complete description of the Company’s business and accounting policies. In the opinion of management, all adjustments necessary for a fair statement of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results of operations for the full year. The consolidated balance sheet as of December 31, 2022 was derived from the Company’s audited annual consolidated financial statements. Use of Estimates The preparation of consolidated financial statements in conformity with GAAP requires management to 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 consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ materially from these estimates. Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires organizations to estimate credit losses on certain types of financial instruments, including receivables and fixed maturity securities, by introducing an approach based on expected losses. The expected loss approach required entities to incorporate considerations of historical information, current information, and reasonable and supportable forecasts. The Company adopted ASU 2016-13 effective January 1, 2023 using the modified retrospective approach, by which a cumulative-effect adjustment was made to retained earnings as of the date of adoption. In connection with the adoption of ASU 2016-13, the Company elected the fair value option in accounting for mortgage loans effective January 1, 2023 as targeted transition relief. The adoption of ASU 2016-13 resulted in a $2.3 million increase in accumulated deficit, net of tax. Updates to Significant Accounting Policies The following accounting policies have been updated to reflect the Company's adoption of ASU 2016-13 Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments as described above. Investments Available-for-sale Investments in fixed maturities that are classified as available-for-sale and are carried at fair value. For available-for-sale fixed maturities in an unrealized loss position, the Company first determines whether there is an intent to sell the security or if it is more likely than not that the Company will be required to sell the security before maturity or recovery of its cost basis. If either of these criteria were met, the amortized cost of the security is written down to fair value with the losses recognized in net investment gains (losses) on the consolidated statements of operations. If neither of the these criteria were met, the Company determines whether unrealized losses are due to credit-related factors. If the unrealized losses are due to credit-related factors, an allowance for credit losses is determined using a present value of cash flows compared to the amortized cost of the security. The allowance for credit losses is limited to the amount by which fair value is below amortized cost. Changes in the allowance for credit losses are recognized in net investment gains (losses) on the consolidated statements of operations. Credit losses that are limited by the fair value of the security are recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss). Unrealized losses that are not credit-related continue to be recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss). Held-to-maturity Investments in fixed maturity securities, held-to-maturity are carried at amortized cost net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate from Moody’s table of estimated multi-year cumulative loss rates for asset backed securities. This historical loss rate is adjusted for current conditions and reasonable and supportable forecasts. Changes in the allowance for credit losses are recognized in net investment gains (losses) on the consolidated statements of operations. Mortgage loans The Company elected the fair value option in accounting for mortgage loans effective January 1, 2023 as targeted transition relief. Under the fair value option, mortgage loans are measured at fair value, and changes in unrealized gains and losses on mortgage loans are reported in net investment gains (losses) on the condensed consolidated statements of operations. Interest income and amortization continue to be recognized in net investment income on the consolidated statements of operations. Reinsurance Reinsurance Recoverables Reinsurance recoverables are carried net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate using the A.M. Best impairment rate and rating transition study which provides historical loss data of similarly rated reinsurance companies based on the expected duration of the receivables. This historical loss rate is adjusted for current conditions and reasonable and supportable forecasts and consideration of current economic conditions. Changes in the allowance for credit losses are recognized in underwriting, acquisition and insurance expenses on the consolidated statements of operations. Premiums Premium receivables are carried net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate using historical write-offs and aging of receivables. This historical loss rate is adjusted for current conditions, reasonable and supportable forecasts and our ability to cancel coverage on a policy after premium is considered past due. Changes in the allowance for credit losses are recognized in underwriting, acquisition and insurance expenses on the consolidated statements of operations. |
Investments
Investments | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The following tables set forth the amortized cost and the fair value by investment category at March 31, 2023 and December 31, 2022: ($ in thousands) Gross Gross Gross Allowance for Credit Losses Fair Value March 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 46,347 $ 35 $ (1,464) $ — $ 44,918 Corporate securities and miscellaneous 278,980 1,571 (18,117) — 262,434 Municipal securities 73,232 152 (6,045) — 67,339 Residential mortgage-backed securities 146,830 458 (13,398) — 133,890 Commercial mortgage-backed securities 55,183 228 (3,229) — 52,182 Asset-backed securities 117,823 213 (5,662) — 112,374 Total fixed maturity securities, available-for-sale $ 718,395 $ 2,657 $ (47,915) $ — $ 673,137 Fixed maturity securities, held-to-maturity: Asset-backed securities $ 48,537 $ — $ (3,724) $ (321) $ 44,492 Total fixed maturity securities, held-to-maturity $ 48,537 $ — $ (3,724) $ (321) $ 44,492 ($ in thousands) Gross Gross Gross Fair Value December 31, 2022 Fixed maturity securities, available-for-sale: U.S. government securities $ 50,416 $ 1 $ (1,876) $ 48,541 Corporate securities and miscellaneous 255,116 767 (20,754) 235,129 Municipal securities 65,836 24 (8,133) 57,727 Residential mortgage-backed securities 134,844 218 (15,206) 119,856 Commercial mortgage-backed securities 40,129 50 (3,684) 36,495 Asset-backed securities 116,275 91 (6,542) 109,824 Total fixed maturity securities, available-for-sale $ 662,616 $ 1,151 $ (56,195) $ 607,572 Fixed maturity securities, held-to-maturity: Asset-backed securities $ 52,467 $ — $ (5,696) $ 46,771 Total fixed maturity securities, held-to-maturity $ 52,467 $ — $ (5,696) $ 46,771 The following table sets forth the amortized cost and fair value of available-for-sale fixed maturity securities by contractual maturity at March 31, 2023: ($ in thousands) Amortized Fair Value Due in less than one year $ 27,656 $ 26,956 Due after one year through five years 214,722 205,835 Due after five years through ten years 108,566 99,254 Due after ten years 47,615 42,646 Mortgage-backed securities 202,013 186,072 Asset-backed securities 117,823 112,374 Total $ 718,395 $ 673,137 Expected maturities may differ from contractual maturities because borrowers have the right to call or prepay obligations with or without call or prepayment penalties. Also, changing interest rates, tax considerations or other factors may result in portfolio sales prior to maturity. The Company’s fixed maturity securities, held-to-maturity, at March 31, 2023 consisted entirely of asset backed securities that were not due at a single maturity date. The following tables set forth the gross unrealized losses and the corresponding fair values of investments, aggregated by length of time that individual securities had been in a continuous unrealized loss position as of March 31, 2023 and December 31, 2022: Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses March 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 19,722 $ (443) $ 18,777 $ (1,021) $ 38,499 $ (1,464) Corporate securities and miscellaneous 107,567 (4,059) 98,368 (14,058) 205,935 (18,117) Municipal securities 35,247 (1,764) 22,752 (4,281) 57,999 (6,045) Residential mortgage-backed securities 41,507 (1,919) 65,869 (11,479) 107,376 (13,398) Commercial mortgage-backed securities 28,658 (869) 11,393 (2,360) 40,051 (3,229) Asset-backed securities 62,813 (2,636) 35,681 (3,026) 98,494 (5,662) Total fixed maturity securities, available-for-sale 295,514 (11,690) 252,840 (36,225) 548,354 (47,915) Fixed maturity securities, held-to-maturity: Asset-backed securities 1,624 (19) 42,868 (3,705) 44,492 (3,724) Total fixed maturity securities, held-to-maturity: 1,624 (19) 42,868 (3,705) 44,492 (3,724) Total $ 297,138 $ (11,709) $ 295,708 $ (39,930) $ 592,846 $ (51,639) Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses December 31, 2022 Fixed maturity securities, available-for-sale: U.S. government securities $ 28,966 $ (603) $ 18,577 $ (1,273) $ 47,543 $ (1,876) Corporate securities and miscellaneous 171,506 (16,063) 34,283 (4,691) 205,789 (20,754) Municipal securities 51,701 (7,236) 3,689 (897) 55,390 (8,133) Residential mortgage-backed securities 56,246 (4,152) 52,778 (11,054) 109,024 (15,206) Commercial mortgage-backed securities 25,836 (1,488) 8,583 (2,196) 34,419 (3,684) Asset-backed securities 74,684 (3,351) 25,820 (3,191) 100,504 (6,542) Total fixed maturity securities, available-for-sale 408,939 (32,893) 143,730 (23,302) 552,669 (56,195) Fixed maturity securities, held-to-maturity: Asset-backed securities 46,771 (5,696) — — 46,771 (5,696) Total fixed maturity securities, held-to-maturity: 46,771 (5,696) — — 46,771 (5,696) Total $ 455,710 $ (38,589) $ 143,730 $ (23,302) $ 599,440 $ (61,891) The Company regularly monitors its available-for-sale fixed maturity securities that have fair values less than cost or amortized cost for signs of impairment, an assessment that requires significant management judgment regarding the evidence known. Such judgments could change in the future as more information becomes known, which could negatively impact the amounts reported. Among the factors that management considers for fixed maturity securities are the financial condition of the issuer including receipt of scheduled principal and interest cash flows, and intent to sell, including if it is more likely than not that the Company will be required to sell the investments before recovery. As of March 31, 2023, the Company had 551 lots of fixed maturity securities in an unrealized loss position. The Company does not have an intent to sell these securities and it is not more likely than not that the Company will be required to sell these securities before maturity or recovery of its cost basis. The Company determined that no credit impairment existed in the gross unrealized holding losses because the credit ratings of these securities were consistent with the credit ratings when purchased and/or at origination, there were no adverse changes in financial condition of the issuer and no adverse credit quality events in underlying assets. The Company attributed the unrealized losses to the changes in interest rates. The following table sets forth the components of net investment gains (losses) for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Gross realized gains Fixed maturity securities, available-for sale $ 493 $ 16 Equity securities 1,227 1,830 Other 1 31 Total 1,721 1,877 Gross realized losses Fixed maturity securities, available-for sale (237) (276) Equity securities (4,289) (654) Other (1) (16) Total (4,527) (946) Net unrealized gains (losses) on investments Equity securities 3,745 (5,369) Mortgage loans 22 — Net investment gains (losses) $ 961 $ (4,438) The following table sets forth the proceeds from sales of available-for-sale fixed maturity securities and equity securities for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for sale $ 8,392 $ 7,575 Equity securities 13,325 11,966 The following table sets forth the components of net investment income for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for sale $ 6,676 $ 3,224 Fixed maturity securities, held-to-maturity 1,003 1,937 Equity securities 726 738 Equity method investments (4,664) 9,210 Mortgage loans 1,473 818 Indirect loans (1,319) 1,657 Short-term investments and cash 1,789 27 Other (20) 7 Total investment income 5,664 17,618 Investment expenses (1,018) (2,469) Net investment income $ 4,646 $ 15,149 The following table sets forth the change in net unrealized gains (losses) on the Company’s investment portfolio, net of deferred income taxes, included in other comprehensive income (loss) for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities $ 9,786 $ (20,764) Deferred income taxes (2,045) 4,360 Total $ 7,741 $ (16,404) |
Fair Value Measurements
Fair Value Measurements | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair ValueMeasurements | Fair Value Measurements The Company’s financial instruments include assets and liabilities carried at fair value, as well as assets and liabilities carried at cost or amortized cost but disclosed at fair value in its consolidated financial statements. In determining fair value, the market approach is generally applied, which uses prices and other relevant data based on market transactions involving identical or comparable assets and liabilities. The Company uses data primarily provided by third-party investment managers or pricing vendors to determine the fair value of its investments. Periodic analyses are performed on prices received from third parties to determine whether the prices are reasonable estimates of fair value. The analyses include a review of month-to-month price fluctuations and, as needed, a comparison of pricing services’ valuations to other pricing services’ valuations for the identical security. The Company classifies its financial instruments into the following three-level hierarchy: Level 1 - Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurement date. Level 2 - Inputs are other than quoted prices included in Level 1 that are observable for the asset or liability through corroboration with market data at the measurement date. Level 3 - Unobservable inputs that reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. The following methods and assumptions were used in estimating the fair value disclosures for financial instruments in the accompanying consolidated financial statements and in these notes: U.S. government securities, mutual funds and common stock The Company uses unadjusted quoted prices for identical instruments in an active exchange to measure fair value which represent Level 1 inputs. Preferred stocks, municipal securities, corporate securities and miscellaneous The Company uses a pricing model that utilizes market-based inputs such as trades in an illiquid market for a particular security or trades in active markets for securities with similar characteristics. The model considers other inputs such as benchmark yields, issuer spreads, security terms and conditions, and other market data. These represent Level 2 fair value inputs. Commercial mortgage-backed securities, residential mortgage-backed securities and asset-backed securities The Company uses a pricing model that utilizes market-based inputs that may include dealer quotes, market spreads, and yield curves. It may evaluate individual tranches in a security by determining cash flows using the security’s terms and conditions, collateral performance, credit information benchmark yields and estimated prepayments. These represent Level 2 fair value inputs. Mortgage loans Mortgage loans have variable interest rates and are collateralized by real property. The Company determines fair value of mortgage loans using the income approach utilizing inputs that are observable and unobservable (Level 3). The unobservable input consists of the spread applied to a prime rate used to discount cash flows. The spread represents the incremental cost of capital based on the borrower’s ability to make future payments and the value of the collateral relative to the loan balance and is subject to judgement and uncertainty. The following table sets forth the range and weighted average, weighted by relative fair value, of the spread as of March 31, 2023: March 31, 2023 High 9.50 % Low 2.05 % Weighted average 5.85 % The following tables set forth the Company’s investments within the fair value hierarchy at March 31, 2023 and December 31, 2022: March 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 44,918 $ — $ — $ 44,918 Corporate securities and miscellaneous — 262,434 — 262,434 Municipal securities — 67,339 — 67,339 Residential mortgage-backed securities — 133,890 — 133,890 Commercial mortgage-backed securities — 52,182 — 52,182 Asset-backed securities — 112,374 — 112,374 Total fixed maturity securities, available-for-sale 44,918 628,219 — 673,137 Fixed maturity securities, held-to-maturity: Asset-backed securities — — 44,492 44,492 Total fixed maturity securities, held-to-maturity — — 44,492 44,492 Common stocks: Consumer discretionary 1,965 — — 1,965 Consumer staples 13,116 — — 13,116 Energy 2,947 — — 2,947 Finance 19,088 — — 19,088 Industrial 11,244 — — 11,244 Information technology 2,912 — — 2,912 Materials 3,253 — — 3,253 Other 2,292 — — 2,292 Total common stocks 56,817 — — 56,817 Preferred stocks: Consumer staples 473 — 473 Finance 3,979 — 3,979 Industrial — 1,135 — 1,135 Other — 735 — 735 Total preferred stocks — 6,322 — 6,322 Mutual funds: Fixed income 5,191 — — 5,191 Equity 51,615 — — 51,615 Commodity 520 — — 520 Total mutual funds 57,326 — — 57,326 Total equity securities 114,143 6,322 — 120,465 Mortgage loans — — 42,335 42,335 Short-term investments 287,351 — — 287,351 Total investments $ 446,412 $ 634,541 $ 86,827 $ 1,167,780 December 31, 2022 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 48,541 $ — $ — $ 48,541 Corporate securities and miscellaneous — 235,129 — 235,129 Municipal securities — 57,727 — 57,727 Residential mortgage-backed securities — 119,856 — 119,856 Commercial mortgage-backed securities — 36,495 — 36,495 Asset-backed securities — 109,824 — 109,824 Total fixed maturity securities, available-for-sale 48,541 559,031 — 607,572 Fixed maturity securities, held-to-maturity: Asset-backed securities — — 46,771 46,771 Total fixed maturity securities, held-to-maturity: — — 46,771 46,771 Common stocks: Consumer discretionary 1,948 — — 1,948 Consumer staples 12,036 — — 12,036 Energy 3,241 — — 3,241 Finance 22,636 — — 22,636 Industrial 9,452 — — 9,452 Information technology 2,284 — — 2,284 Materials 2,820 — — 2,820 Other 1,579 — — 1,579 Total common stocks 55,996 — — 55,996 Preferred stocks: Consumer staples — 117 — 117 Finance — 7,085 — 7,085 Industrial — 1,020 — 1,020 Other — 549 — 549 Total preferred stocks — 8,771 — 8,771 Mutual funds: Fixed income 5,068 — — 5,068 Equity 49,773 — — 49,773 Commodity 561 — — 561 Total mutual funds 55,402 — — 55,402 Total equity securities 111,398 8,771 — 120,169 Mortgage loans — — 52,842 52,842 Short-term investments 121,158 — — 121,158 Total investments $ 281,097 $ 567,802 $ 99,613 $ 948,512 The following table sets forth the changes in the fair value of instruments carried at fair value with a Level 3 measurement during the three months ended March 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total gains for the period recognized in net investment gains (losses) $ 22 Issuances $ 892 Settlements (11,421) Balance at March 31, 2023 $ 42,335 Total losses for the period recognized in net investment gains (losses) attributable to the change in unrealized gains or losses relating to assets held as of period end $ (14) The Company measures certain assets, including investments in indirect loans and loan collateral, equity method investments and other invested assets, at fair value on a nonrecurring basis only when they are deemed to be impaired. In addition to the preceding disclosures on assets and liabilities recorded at fair value in the consolidated balance sheets, the Company is also required to disclose the fair values of certain other financial instruments for which it is practicable to estimate fair value. Estimated fair value amounts, defined as the quoted market price of a financial instrument, have been determined using available market information and other appropriate valuation methodologies. However, considerable judgements are required in developing the estimates of fair value where quoted market prices are not available. Accordingly, these estimates are not necessarily indicative of the amounts that could be realized in a current market exchange. The use of different market assumptions or estimating methodologies may have an effect on the estimated fair value amounts. The following methods and assumptions were used in estimating the fair value disclosures of other financial instruments: Fixed maturity securities, held-to-maturity: Fixed maturity securities, held-to-maturity consists of senior and junior notes with target rates of return. As of March 31, 2023, the Company determined the fair value of these instruments using the income approach utilizing inputs that are unobservable (Level 3). Notes payable: The carrying value approximates the estimated fair value for notes payable as the notes payable accrue interest at current market rates plus a spread. The Company determines fair value using the income approach utilizing inputs that are available (Level 2). Subordinated debt: Subordinated debt consists of two debt instruments, the Junior Subordinated Interest Debentures, due September 15, 2036, and Unsecured Subordinated Notes, due May 24, 2039. The carrying value of the Junior Subordinated Interest Debentures approximates the estimated fair value as the instrument accrues interest at current market rates plus a spread. Unsecured Subordinated Notes have a fixed interest rate. The Company determines the fair value of these instruments using the income approach utilizing inputs that are observable (Level 2). The following table sets forth the Company’s carrying and fair values of notes payable and subordinated debt as of March 31, 2023 and December 31, 2022: March 31, 2023 December 31, 2022 ($ in thousands) Carrying Fair Carrying Fair Notes Payable Term loan, due December 31, 2024 $ — $ — $ 50,000 $ 50,000 Revolving credit facility 50,000 50,000 — — Notes payable $ 50,000 $ 50,000 $ 50,000 $ 50,000 Subordinated Debt Junior subordinated interest debentures $ 59,149 $ 59,794 $ 59,137 $ 59,794 Unsecured subordinated notes 19,480 18,622 19,472 18,934 Subordinated debt, net of debt issuance costs $ 78,629 $ 78,416 $ 78,609 $ 78,728 |
Mortgage Loans
Mortgage Loans | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Mortgage Loans | Mortgage Loans The Company has invested in Separately Managed Accounts (“SMA1” and “SMA2”), managed by Arena Investors, LP (“Arena”), which is affiliated with The Westaim Corporation (“Westaim”) who, directly and through Westaim HIIG LP (a limited partnership controlled by Westaim), is the Company’s largest shareholder. As of March 31, 2023 and December 31, 2022, the Company held direct investments in mortgage loans from various creditors through SMA1 and SMA2. The Company’s mortgage loan portfolios are primarily senior loans on real estate across the U.S. The loans earn interest at a fixed rate above a prime rate, mature in approximately 1 to 2 years from loan origination and the principal amounts of the loans range between 40% to 80% property’s appraised value at the time the loans were made. Mortgage loan participations are carried at cost adjusted for unamortized premiums, discounts, and loan fees. The carrying value of the Company’s mortgage loans as of March 31, 2023 and December 31, 2022 were as follows: ($ in thousands) March 31, 2023 December 31, 2022 Retail $ 15,568 $ 16,516 Industrial — 6,329 Commercial 16,086 15,309 Multi-family 2,596 5,593 Office 3,210 3,197 Hospitality 4,875 4,915 $ 42,335 $ 51,859 The Company’s gross investment income for mortgage loans for the three months ended March 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Retail $ 595 $ 359 Commercial 494 210 Multi-family 117 69 Office 106 166 Hospitality 161 14 $ 1,473 $ 818 The uncollectible amounts on loans, on an individual loan basis, are determined based upon consultations and advice from the Company’s specialized investment manager and consideration of any adverse situations that could affect the borrower’s ability to repay, the estimated value of underlying collateral, and other relevant factors. The Company writes off the uncollectible amount in the period it was determined to be uncollectible. There was no write-off for uncollectible amounts during the three months ended March 31, 2023 and 2022. As of March 31, 2023 and December 31, 2022, approximately $0.0 million and $6.4 million of mortgage loans, respectively, were in the process of foreclosure. The carrying value of the mortgage loans in foreclosure is the lower of cost adjusted for unamortized premiums, discounts, and loan fees or the fair value of the collateral less costs to sell. |
Other Long-Term investments
Other Long-Term investments | 3 Months Ended |
Mar. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Other Long-Term Investments | Other Long-Term Investments Equity Method Investments The Company’s ownership interests in most of its equity method investments range from approximately 3% to less than 50% where the Company has significant influence but not control. The carrying value of the Company’s equity method investments as of March 31, 2023 and December 31, 2022 were as follows: ($ in thousands) March 31, 2023 December 31, 2022 Arena SOP LP units $ 6,683 $ 8,734 Arena Special Opportunities Fund, LP units 42,701 44,504 Brewer Lane Ventures Fund II LP units 390 200 Dowling Capital Partners LP units 2,231 1,965 Hudson Ventures Fund 2 LP units 3,391 3,551 JVM Funds LLC units 21,698 22,473 RISCOM 4,118 4,037 Universa Black Swan LP units 770 1,325 $ 81,982 $ 86,789 The following table sets forth the components of net investment (loss) income from equity method investments for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Arena SOP LP units $ (2,051) $ 6,117 Arena Special Opportunities Fund, LP units (1,730) 2,804 Dowling Capital Partners LP units 267 514 Hudson Ventures Fund 2 LP units (255) 64 JVM Funds LLC (420) 186 RISCOM 81 18 Universa Black Swan LP units (556) (493) $ (4,664) $ 9,210 The following table sets forth the unfunded commitment of equity method investments as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Brewer Lane Ventures Fund II LP units $ 4,610 $ 4,800 Dowling Capital Partners LP units 386 386 Hudson Ventures Fund 2 LP units 1,701 1,796 $ 6,697 $ 6,982 The difference between the cost of an investment and its proportionate share of the underlying equity in net assets is allocated to the various assets and liabilities of the equity method investment. The Company amortizes the difference in net assets over the same useful life of a similar asset as the underlying equity method investment. For investment in RISCOM, a similar asset would be agent relationships. The Company amortizes this difference over a 15-year useful life. The following table sets forth the Company’s recorded investment in RISCOM compared to its share of underlying equity as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Investment in RISCOM: Underlying equity $ 2,434 $ 2,292 Difference 1,684 1,745 Recorded investment balance $ 4,118 $ 4,037 The following table sets forth the Company’s recorded investment in JVM Funds LLC compared to its share of underlying equity as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Investment in JVM Funds LLC: Underlying equity $ 20,828 $ 21,565 Difference 870 908 Recorded investment balance $ 21,698 $ 22,473 Investment in Bank Holding Company The Company carries its investment in Captex Bancshares at cost, less impairment or observable changes in price. The Company reviews these investments for impairment or observable changes in price during each reporting period. There were no impairments or observable changes in price during the three months ended March 31, 2023 and the year ended December 31, 2022. Investment in Indirect Loans and Loan Collateral As of March 31, 2023 and December 31, 2022, the Company held indirect investments in collateralized loans and loan collateral through SMA1 and SMA2. The carrying value and unfunded commitment of the SMA1 and SMA2 as of March 31, 2023 and December 31, 2022 were as follows: March 31, 2023 December 31, 2022 ($ in thousands) Carrying Value Unfunded Commitment Carrying Value Unfunded Commitment SMA1 $ 34,654 $ — $ 36,426 $ — SMA2 (1) (1,652) — 2,010 — Investment in indirect loans and loan collateral $ 33,002 $ — $ 38,436 $ — (1) The carrying value of SMA2 is negative as of March 31, 2023 due to distribution in-transit. Investment in Trust |
Allowance for Credit Losses
Allowance for Credit Losses | 3 Months Ended |
Mar. 31, 2023 | |
Credit Loss [Abstract] | |
Allowance for Credit Losses | Allowance for Credit Losses Premiums Receivable The following table sets forth the changes in the allowance for expected credit losses for the three months ended March 31, 2023. ($ in thousands) Allowance for Credit Losses Balance at December 31, 2022 $ 629 Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 — Current period change for estimated uncollectible premiums 409 Write-offs of uncollectible premiums receivable (56) Balance at March 31, 2023 $ 982 Reinsurance Recoverables The Company analyzes the credit risk associated with its reinsurance recoverables by monitoring the financial strength rating of its reinsurers from A.M. Best, a widely recognized rating agency with an exclusive insurance industry focus. The Company assesses the financial strength rating annually and updated throughout the year as A.M. Best provides updates on ratings and outlooks. The Company assesses the adequacy of various forms of credit enhancements such as reinsurance payables, letters of credit and funds held. A summary of the Company’s reinsurance recoverables net of credit enhancements by A.M. Best rating as of March 31, 2023 was as follows: A.M. Best Rating March 31, 2023 A- and above 98.5 % B++ to B+ 1.4 Not rated 0.1 The Company considers reinsurance balances to be past due when it is 90 days past due. The following table sets forth the changes in the allowance for estimated uncollectible reinsurance for the three months ended March 31, 2023: ($ in thousands) Allowance for Credit Losses Balance at December 31, 2022 $ — Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 2,295 Current period change for estimated uncollectible reinsurance — Balance at March 31, 2023 $ 2,295 |
Notes_Payable
Notes Payable | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Notes Payable | Notes Payable The Company entered into an agreement to obtain a new unsecured revolving credit facility (the “Revolving Credit Facility”) with a syndicate of participating banks during the three months ended March 31, 2023. The Revolving Credit Facility provided the Company with up to a $150.0 million revolving credit facility, with an accordion that can increase the capacity by $50.0 million, and a letter of credit sub-facility of up to $30.0 million. During the three months ended March 31, 2023, the Company drew $50.0 million on the Revolving Credit Facility and used the proceeds to pay off the principal on its existing term loan. The Company subsequently terminated the existing term loan and revolving line of credit. The interest rate on the Revolving Credit Facility was the Secured Overnight Financing Rate (“SOFR”) plus a margin of between 150 and 190 basis points based on the ratio of debt to total capital and a credit spread adjustment of 10 basis points. |
Stockholders_ Equity
Stockholders’ Equity | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Stockholders’ Equity | Stockholders’ Equity Reverse Stock Split On September 23, 2022, the Board of Directors approved a 4-for-1 reverse stock split of the Company’s common stock. The stock split became effective January 3, 2023. All share and per share information included in the accompanying consolidated financial statements and notes to the consolidated financial statements have been retroactively adjusted to reflect the stock split of common stock for all periods presented. Initial Public Offering On January 4, 2023, the Company announced the launch of its initial public offering (“IPO”) of its common stock. On January 12, 2023, the Company priced its IPO of 8,952,383 shares of its common stock, with 4,750,000 shares offered by the Company and 4,202,383 shares sold by selling stockholders, at a public price of $15.00 per share. The shares began trading on January 13, 2023 on the Nasdaq Global Select Market under the ticker symbol “SKWD.” The Company completed its IPO on January 18, 2023. The underwriters exercised in full their option to purchase 1,342,857 additional shares of common stock from the selling stockholders, at a price per share of $15.00. The Company’s net proceeds from the IPO were approximately $62.4 million, after deducting underwriting discounts and specific incremental expenses directly attributable to the IPO. Upon the closing of its IPO, the Company filed an amended and restated certificate of incorporation which, among other things, increased the number of authorized shares consisting of 500,000,000 shares of common stock, par value $0.01 per share, and 10,000,000 shares of preferred stock, par value $0.01 per share. Preferred Shares Conversion The Preferred Shares had preference in liquidation over common stock in the amount of the face value of $50.00 per share and any declared but unpaid dividends to related common shares at the applicable conversion rate. The Preferred Shares provided the holder the option at any time to convert the Preferred Shares into common stock based on the Option Conversion Rate. At December 31, 2022, the Company had 1,969,660 Preferred Shares that could be converted to 16,305,113 common shares based on a conversion price equal to $6.04 per common share. The Preferred Shares were subject to mandatory conversion upon the closing of an IPO at the Mandatory Conversion Rate. At December 31, 2022, the Mandatory Conversion Rate allowed the holder of the Preferred Shares the right to convert into common stock based on a conversion price equal to $6.04 per common share. On January 18, 2023, the 1,969,660 Preferred Shares converted to 16,305,113 shares of common stock upon the Company’s closing of its IPO. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table set forth the Company’s income tax expense and effective tax rates for the three months ended March 31, 2023 and 2022: ($ in thousands 2023 2022 Income tax expense $ 4,166 $ 4,269 Effective tax rate 21.1 % 20.7 % The effective tax rate will differ from the statutory rate of 21 percent due to permanent differences for disallowed expenses for tax and beneficial adjustments for tax-exempt income and dividends-received deduction. |
Losses and Loss Adjustment Expe
Losses and Loss Adjustment Expenses | 3 Months Ended |
Mar. 31, 2023 | |
Insurance [Abstract] | |
Losses and Loss Adjustment Expenses | Losses and Loss Adjustment Expenses The following table sets forth the reconciliation of unpaid losses and loss adjustment expenses as reported in the condensed consolidated balance sheets as of and for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Reserves for losses and LAE, beginning of period $ 1,141,757 $ 979,549 Less: reinsurance recoverable on unpaid claims, beginning of period (435,986) (381,338) Reserves for losses and LAE, beginning of period, net of reinsurance 705,771 598,211 Incurred, net of reinsurance, related to: Current period 115,142 89,989 Prior years — — Total incurred, net of reinsurance 115,142 89,989 Paid, net of reinsurance, related to: Current period 8,744 10,605 Prior years 68,745 62,959 Total paid 77,489 73,564 Net reserves for losses and LAE, end of period 743,424 614,636 Plus: reinsurance recoverable on unpaid claims, end of period 429,752 385,146 Reserves for losses and LAE, end of period $ 1,173,176 $ 999,782 |
Commission and Fee Income
Commission and Fee Income | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Commission and Fee Income | Commission and Fee Income Skyward Underwriters Agency, Inc. (“SUA”), a subsidiary of the Company, is a managing general insurance agent and reinsurance broker for property and casualty and accident and health risks in specialty niche markets. Commission and fee income is primarily generated from SUA for the placement of insurance policies on either a third-party insurance or reinsurance company. The following table sets forth the Company’s disaggregated revenues from contracts with customers for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 SUA commission revenue $ 857 $ 624 SUA fee income 456 (159) Other 179 (235) Total commission and fee income $ 1,492 $ 230 The Company’s contract assets from commission and fee income as of March 31, 2023 and December 31, 2022 were $1.3 million and $1.3 million, respectively. Contract assets were $0.8 million and $1.2 million as of March 31, 2022 and December 31, 2021, respectively. |
Underwriting, Acquisition and I
Underwriting, Acquisition and Insurance Expenses | 3 Months Ended |
Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Underwriting, Acquisition and Insurance Expenses | Underwriting, Acquisition and Insurance Expenses The following table sets forth the components of underwriting, acquisition and insurance expenses for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Amortization of policy acquisition costs $ 21,235 $ 13,421 Other operating and general expenses 30,420 27,113 Total underwriting, acquisition and insurance expenses $ 51,655 $ 40,534 |
Reinsurance
Reinsurance | 3 Months Ended |
Mar. 31, 2023 | |
Insurance [Abstract] | |
Reinsurance | Reinsurance Certain premiums and benefits are assumed from and ceded to other insurance companies under various reinsurance agreements. The reinsurance agreements provide the Company with increased capacity to write larger risks and maintain its exposure to loss within its capital resources. The Company remains obligated for amounts ceded in the event that the reinsurers do not meet their obligations. The following table sets forth the effects of reinsurance on premiums written and earned for the three months ended March 31, 2023 and 2022: 2023 2022 ($ in thousands) Written Earned Written Earned Direct premiums $ 308,213 $ 262,658 $ 248,635 $ 222,637 Assumed premiums 52,285 39,131 34,007 26,595 Ceded premiums (158,357) (118,958) (147,241) (107,506) Net premiums $ 202,141 $ 182,831 $ 135,401 $ 141,726 Ceded losses and LAE incurred $ 64,794 $ 61,527 The following table sets forth the components of reinsurance recoverables and ceded unearned premium as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Unpaid losses and loss adjustment expenses ceded $ 429,752 $ 435,986 Paid losses and loss adjustment expense ceded 107,463 107,228 Loss portfolio transfer 35,584 38,145 Allowance for credit losses (2,295) — Reinsurance recoverables $ 570,504 $ 581,359 Ceded unearned premium $ 197,044 $ 157,645 The Company entered into agreements with several of its reinsurers, whereby the reinsurer established funded trust accounts with the Company as the sole beneficiary. These trust accounts provide the Company additional security to collect claim recoverables under reinsurance contracts and the Company does not carry these on the balance sheet because the Company will only have custody over these accounts upon the failure of the reinsurer to pay amounts due. At March 31, 2023, the market value of these accounts was approximately $127.1 million. The agreements provide that, as was customary in the past, the reinsurer will continue claim payment reimbursements without disturbing the trust balances. The trust amount will be adjusted periodically, by mutual agreement, based on loss reserve recoverables. Certain ceded reinsurance contracts that transfer only significant timing risk and do not transfer sufficient underwriting risk are accounted for using the deposit method of accounting. The Company’s deposit asset at March 31, 2023 and December 31, 2022 was $36.8 million and $41.8 million, respectively, and was included in other assets on the condensed consolidated balance sheets. |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | Stock Based Compensation In December 2020, the Compensation Committee approved a Long Term Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the granting of restricted stock, restricted stock units and performance stock units (collectively “restricted stock units” or “stock units”), as well as cash-based performance awards, to select employees and non-employee directors of the Company. The Compensation Committee granted 1,073,494 and 191,691 restricted stock and restricted stock units during the three months ended March 31, 2023 and 2022, under the 2022 Plan and 2021 Plans, respectively. Members of the Board of Directors were granted 3,332 and 15,196 restricted stock during the three months ended March 31, 2023 and 2022, respectively, with a service period of 1 year. The fair value of restricted stock and restricted stock units under the 2022 Plan for awards granted at the time of the Company’s IPO were granted at the IPO price of $15.00 per share. The fair value of subsequent grants were equal to the closing stock price on the date the restricted stock units were granted. The Compensation Committee granted 759,990 stock options during the three months ended March 31, 2023. The grant date fair value of the options was determined using the Black-Scholes model where the term was the contractual term of 10 years less the weighted average service period. The volatility was determined based on the historical volatility of comparable publicly traded insurance companies. The restricted stock and restricted stock units granted to employees and the Board of Directors during the three months ended March 31, 2023 and 2022 were valued at approximately $17.0 million and $2.5 million, respectively, based on the grant date fair value. The stock options granted to employees during the three months ended March 31, 2023 were valued at approximately $4.4 million based on the grant date fair value. The following table sets forth the Company’s equity awards, target payout ranges and authorized target restricted stock and stock units for the three months ended March 31, 2023 and 2022: Award Requisite Target Three months ended March 31, 2023 Market condition awards 0%–150% 3 years 37,622 Performance condition awards 0%–150% 3 years 91,350 Service condition awards N/A 1–4 years 944,522 Stock options N/A 3–4 years 759,990 1,833,484 Three months ended March 31, 2022 Market condition awards 0%–150% 3 years 28,495 Performance condition awards 0%–150% 3 years 26,214 Service condition awards N/A 1–3 years 136,982 191,691 The following table sets forth option activity for the three months ended March 31, 2023: Weighted-Average Stock Outstanding at January 1, 2023 — Granted $ 15.00 759,990 Exercised — Forfeited — Outstanding at March 31, 2023 $ 15.00 759,990 The intrinsic value of each option is determined based on the difference between the fair value of the underlying share and the exercise price of the underlying option. The aggregate intrinsic value of options outstanding at March 31, 2023 was $5.2 million. The weighted-average remaining contractual life of the options outstanding at March 31, 2023 was 9.8 years. The following table sets forth the Company’s restricted stock and restricted stock units activity for the three months ended March 31, 2023 and 2022: Weighted-Average Stock and Stock Units Non-vested at January 1, 2023 $ 12.55 419,896 Granted 15.85 1,073,494 Vested 12.91 (32,496) Forfeited 15.10 (7,459) Non-vested at March 31, 2023 $ 14.97 1,453,435 Non-vested at January 1, 2022 $ 13.23 375,643 Granted 13.16 191,691 Vested 12.47 (55,851) Forfeited $ — — Non-vested at March 31, 2022 $ 13.28 511,483 The total fair value of shares vested at March 31, 2023 and 2022 were $0.7 million and $0.7 million, respectively. As of March 31, 2023 the total unrecognized compensation cost related to non-vested, share-based compensation awards was $22.2 million and the weighted average period over which that cost is expected to be recognized is 2.1 years. For the three months ended March 31, 2023 and 2022, the Company recognized $1.9 million and $0.5 million, respectively, of stock based compensation expense. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth a reconciliation of the numerator and denominator of basic and diluted earnings per share computations contained in the period-ended consolidated financial statements for the three months ended March 31, 2023 and 2022: ($ in thousands, except for share and per share amounts) 2023 2022 Numerator Net income $ 15,556 $ 16,311 Less: Undistributed income allocated to participating securities (1,274) (7,823) Net income attributable to common shareholders (numerator for basic earnings per share) 14,282 8,488 Add back: Undistributed income allocated to participating securities 1,274 7,823 Net income (numerator for diluted earnings per share under the two-class method) $ 15,556 $ 16,311 Denominator Basic weighted-average common shares 32,848,243 16,376,720 Preferred shares (if converted method) 2,931,256 15,092,585 Contingently issuable instruments (treasury stock method) 708,746 714,185 Market condition awards (contingently issuable) 87,750 40,460 Performance awards (contingently issuable) 38,441 32,362 Restricted stock units (treasury stock method) 318,421 155,995 Options (treasury stock method) 19,216 — Diluted weighted-average common share equivalents 36,952,073 32,412,307 Basic earnings per share $ 0.43 $ 0.52 Diluted earnings per share $ 0.42 $ 0.50 The Company’s preferred shares participate in dividends and distributions with common stock on an as-converted basis and represent a participating security. Instruments awarded to employees that provide the holder the right to purchase common stock at a fixed price were included as potential common shares, weighted for the portion of the period they were granted, if dilutive. Anti-dilutive instruments are excluded from the calculation of diluted weighted-average common share equivalents as they would have an anti-dilutive impact. The following table sets forth the weighted-average instruments that were excluded from the calculation of diluted weighted-average common share equivalents during the three months ended March 31, 2023 and 2022. 2023 2022 Contingently issuable instruments (treasury stock method) 345,764 — Market condition awards (contingently issuable) 13,795 — Performance awards (contingently issuable) 40,080 — Restricted stock units (treasury stock method) 390,076 — Options (treasury stock method) 333,551 — The Company’s common and preferred shares financed by stock notes are contingently issuable instruments where the holder must return, all or part of, the shares if the stock notes are not paid off. The following table sets forth common share equivalents of contingently issuable instruments (in shares) that were excluded from basic earnings per share for the three months ended March 31, 2023 and 2022: 2023 2022 Common shares 1,054,510 183,604 Preferred shares, if converted — 1,216,389 Total 1,054,510 1,399,993 |
Related Party Transactions
Related Party Transactions | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Westaim As of March 31, 2023 and December 31, 2022, Westaim and Westaim HIIG LP owned 39.0% and 44.5%, respectively, of the Company’s common stock. The changes in ownership percentage were primarily due to the IPO and conversion of preferred stock to common stock. The Company’s investment in Westaim is included in equity securities on the consolidated balance sheets. The unrealized loss on this investment as of March 31, 2023 and December 31, 2022 were $1.5 million and $2.3 million, respectively. Prior to the closing of the IPO, Westaim performed consulting and certain other services for the Company pursuant to a Management Services Agreement. This agreement terminated pursuant to its terms upon the closing of the IPO. RISCOM RISCOM provides the Company with wholesale brokerage services. RISCOM and the Company also have a managing general agency agreement. The Company holds a 20% ownership interest in RISCOM. Net earned premium and gross commission expense related to these agreements for the three months ended March 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Net earned premium $ 22,185 $ 21,018 Commissions 6,853 7,348 Premiums receivable as of March 31, 2023 and December 31, 2022 were $17.6 million and $9.9 million, respectively. Reinsurance The Company has reinsurance agreements with Everest Re, an affiliate of Mt. Whitney Securities, LLC, which was a limited partner of Westaim HIIG LP through November 30, 2022, and holder of preferred shares. During the three months ended March 31, 2023, Mt. Whitney Securities divested their entire ownership of the Company’s equity securities. Reinsurance premiums ceded during the three months ended March 31, 2022 related to the agreement were $19.6 million. Reinsurance recoverable from Everest Re, net of premium payables at December 31, 2022 were $177.5 million. Other Advisory and professional services fees and expense reimbursements paid to various affiliated shareholders and directors for the three months ended March 31, 2023 and 2022 were $2.1 million and $0.7 million, respectively. |
Commitment and Contingencies
Commitment and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation The Company is named as a defendant in various legal actions arising from claims made under insurance policies and contracts. Those actions are considered by the Company in estimating the losses and loss adjustment expense reserves. Also, from time to time, the Company is a defendant in various legal actions that relate to bad faith claims, disputes with third parties or that involve alleged errors and omissions. The Company records accruals for these items to the extent the losses are probable and reasonably estimable. Although the ultimate outcome of these matters cannot be determined at this time, based on present information, the availability of insurance coverage and advice received from outside legal counsel, the Company’s management believes the resolution of any such matters will not, individually or in the aggregate, have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. Indemnification |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The unaudited condensed consolidated financial statements of Skyward Specialty Insurance Group, Inc. (the “Company”) have been prepared in accordance with generally accepted accounting principles (“GAAP”) in the United States of America for interim financial reporting and with the instructions to Form 10-Q and Regulation S-X. Accordingly, they do not include all the disclosures required by GAAP for complete consolidated financial statements. Readers are urged to review the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 for a more complete description of the Company’s business and accounting policies. In the opinion of management, all adjustments necessary for a fair statement of the condensed consolidated financial statements have been included. Such adjustments consist only of normal recurring items. Interim results are not necessarily indicative of results of operations for the full year. The consolidated balance sheet as of December 31, 2022 was derived from the Company’s audited annual consolidated financial statements. |
Use of Estimates | Use of Estimates |
Recent Account Standards Adopted and Updates to Significant Accounting Policies | Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments. ASU 2016-13 requires organizations to estimate credit losses on certain types of financial instruments, including receivables and fixed maturity securities, by introducing an approach based on expected losses. The expected loss approach required entities to incorporate considerations of historical information, current information, and reasonable and supportable forecasts. The Company adopted ASU 2016-13 effective January 1, 2023 using the modified retrospective approach, by which a cumulative-effect adjustment was made to retained earnings as of the date of adoption. In connection with the adoption of ASU 2016-13, the Company elected the fair value option in accounting for mortgage loans effective January 1, 2023 as targeted transition relief. The adoption of ASU 2016-13 resulted in a $2.3 million increase in accumulated deficit, net of tax. Updates to Significant Accounting Policies The following accounting policies have been updated to reflect the Company's adoption of ASU 2016-13 Financial Instruments - Credit Losses (ASC 326): Measurement of Credit Losses on Financial Instruments as described above. |
Investments | Investments Available-for-sale Investments in fixed maturities that are classified as available-for-sale and are carried at fair value. For available-for-sale fixed maturities in an unrealized loss position, the Company first determines whether there is an intent to sell the security or if it is more likely than not that the Company will be required to sell the security before maturity or recovery of its cost basis. If either of these criteria were met, the amortized cost of the security is written down to fair value with the losses recognized in net investment gains (losses) on the consolidated statements of operations. If neither of the these criteria were met, the Company determines whether unrealized losses are due to credit-related factors. If the unrealized losses are due to credit-related factors, an allowance for credit losses is determined using a present value of cash flows compared to the amortized cost of the security. The allowance for credit losses is limited to the amount by which fair value is below amortized cost. Changes in the allowance for credit losses are recognized in net investment gains (losses) on the consolidated statements of operations. Credit losses that are limited by the fair value of the security are recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss). Unrealized losses that are not credit-related continue to be recognized in stockholders’ equity, net of taxes, as a component of accumulated other comprehensive income (loss). Held-to-maturity Investments in fixed maturity securities, held-to-maturity are carried at amortized cost net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate from Moody’s table of estimated multi-year cumulative loss rates for asset backed securities. This historical loss rate is adjusted for current conditions and reasonable and supportable forecasts. Changes in the allowance for credit losses are recognized in net investment gains (losses) on the consolidated statements of operations. Mortgage loans |
Reinsurance | Reinsurance Reinsurance Recoverables Reinsurance recoverables are carried net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate using the A.M. Best impairment rate and rating transition study which provides historical loss data of similarly rated reinsurance companies based on the expected duration of the receivables. This historical loss rate is adjusted for current conditions and reasonable and supportable forecasts and consideration of current economic conditions. Changes in the allowance for credit losses are recognized in underwriting, acquisition and insurance expenses on the consolidated statements of operations. |
Premiums | Premiums Premium receivables are carried net of an allowance for credit losses. The allowance for credit losses represents the current estimate of expected credit losses. The Company develops a historical loss rate using historical write-offs and aging of receivables. This historical loss rate is adjusted for current conditions, reasonable and supportable forecasts and our ability to cancel coverage on a policy after premium is considered past due. Changes in the allowance for credit losses are recognized in underwriting, acquisition and insurance expenses on the consolidated statements of operations. |
Fair Value | The following methods and assumptions were used in estimating the fair value disclosures for financial instruments in the accompanying consolidated financial statements and in these notes: U.S. government securities, mutual funds and common stock The Company uses unadjusted quoted prices for identical instruments in an active exchange to measure fair value which represent Level 1 inputs. Preferred stocks, municipal securities, corporate securities and miscellaneous The Company uses a pricing model that utilizes market-based inputs such as trades in an illiquid market for a particular security or trades in active markets for securities with similar characteristics. The model considers other inputs such as benchmark yields, issuer spreads, security terms and conditions, and other market data. These represent Level 2 fair value inputs. Commercial mortgage-backed securities, residential mortgage-backed securities and asset-backed securities The Company uses a pricing model that utilizes market-based inputs that may include dealer quotes, market spreads, and yield curves. It may evaluate individual tranches in a security by determining cash flows using the security’s terms and conditions, collateral performance, credit information benchmark yields and estimated prepayments. These represent Level 2 fair value inputs. Mortgage loans Mortgage loans have variable interest rates and are collateralized by real property. The Company determines fair value of mortgage loans using the income approach utilizing inputs that are observable and unobservable (Level 3). The unobservable input consists of the spread applied to a prime rate used to discount cash flows. The spread represents the incremental cost of capital based on the borrower’s ability to make future payments and the value of the collateral relative to the loan balance and is subject to judgement and uncertainty. The following methods and assumptions were used in estimating the fair value disclosures of other financial instruments: Fixed maturity securities, held-to-maturity: Fixed maturity securities, held-to-maturity consists of senior and junior notes with target rates of return. As of March 31, 2023, the Company determined the fair value of these instruments using the income approach utilizing inputs that are unobservable (Level 3). Notes payable: The carrying value approximates the estimated fair value for notes payable as the notes payable accrue interest at current market rates plus a spread. The Company determines fair value using the income approach utilizing inputs that are available (Level 2). |
Investments (Tables)
Investments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Debt Securities, Trading, and Equity Securities, FV-NI | The following tables set forth the amortized cost and the fair value by investment category at March 31, 2023 and December 31, 2022: ($ in thousands) Gross Gross Gross Allowance for Credit Losses Fair Value March 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 46,347 $ 35 $ (1,464) $ — $ 44,918 Corporate securities and miscellaneous 278,980 1,571 (18,117) — 262,434 Municipal securities 73,232 152 (6,045) — 67,339 Residential mortgage-backed securities 146,830 458 (13,398) — 133,890 Commercial mortgage-backed securities 55,183 228 (3,229) — 52,182 Asset-backed securities 117,823 213 (5,662) — 112,374 Total fixed maturity securities, available-for-sale $ 718,395 $ 2,657 $ (47,915) $ — $ 673,137 Fixed maturity securities, held-to-maturity: Asset-backed securities $ 48,537 $ — $ (3,724) $ (321) $ 44,492 Total fixed maturity securities, held-to-maturity $ 48,537 $ — $ (3,724) $ (321) $ 44,492 ($ in thousands) Gross Gross Gross Fair Value December 31, 2022 Fixed maturity securities, available-for-sale: U.S. government securities $ 50,416 $ 1 $ (1,876) $ 48,541 Corporate securities and miscellaneous 255,116 767 (20,754) 235,129 Municipal securities 65,836 24 (8,133) 57,727 Residential mortgage-backed securities 134,844 218 (15,206) 119,856 Commercial mortgage-backed securities 40,129 50 (3,684) 36,495 Asset-backed securities 116,275 91 (6,542) 109,824 Total fixed maturity securities, available-for-sale $ 662,616 $ 1,151 $ (56,195) $ 607,572 Fixed maturity securities, held-to-maturity: Asset-backed securities $ 52,467 $ — $ (5,696) $ 46,771 Total fixed maturity securities, held-to-maturity $ 52,467 $ — $ (5,696) $ 46,771 |
Investments Classified by Contractual Maturity Date | The following table sets forth the amortized cost and fair value of available-for-sale fixed maturity securities by contractual maturity at March 31, 2023: ($ in thousands) Amortized Fair Value Due in less than one year $ 27,656 $ 26,956 Due after one year through five years 214,722 205,835 Due after five years through ten years 108,566 99,254 Due after ten years 47,615 42,646 Mortgage-backed securities 202,013 186,072 Asset-backed securities 117,823 112,374 Total $ 718,395 $ 673,137 |
Debt Securities, Available-for-Sale, Unrealized Loss Position, Fair Value | The following tables set forth the gross unrealized losses and the corresponding fair values of investments, aggregated by length of time that individual securities had been in a continuous unrealized loss position as of March 31, 2023 and December 31, 2022: Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses March 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 19,722 $ (443) $ 18,777 $ (1,021) $ 38,499 $ (1,464) Corporate securities and miscellaneous 107,567 (4,059) 98,368 (14,058) 205,935 (18,117) Municipal securities 35,247 (1,764) 22,752 (4,281) 57,999 (6,045) Residential mortgage-backed securities 41,507 (1,919) 65,869 (11,479) 107,376 (13,398) Commercial mortgage-backed securities 28,658 (869) 11,393 (2,360) 40,051 (3,229) Asset-backed securities 62,813 (2,636) 35,681 (3,026) 98,494 (5,662) Total fixed maturity securities, available-for-sale 295,514 (11,690) 252,840 (36,225) 548,354 (47,915) Fixed maturity securities, held-to-maturity: Asset-backed securities 1,624 (19) 42,868 (3,705) 44,492 (3,724) Total fixed maturity securities, held-to-maturity: 1,624 (19) 42,868 (3,705) 44,492 (3,724) Total $ 297,138 $ (11,709) $ 295,708 $ (39,930) $ 592,846 $ (51,639) Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses December 31, 2022 Fixed maturity securities, available-for-sale: U.S. government securities $ 28,966 $ (603) $ 18,577 $ (1,273) $ 47,543 $ (1,876) Corporate securities and miscellaneous 171,506 (16,063) 34,283 (4,691) 205,789 (20,754) Municipal securities 51,701 (7,236) 3,689 (897) 55,390 (8,133) Residential mortgage-backed securities 56,246 (4,152) 52,778 (11,054) 109,024 (15,206) Commercial mortgage-backed securities 25,836 (1,488) 8,583 (2,196) 34,419 (3,684) Asset-backed securities 74,684 (3,351) 25,820 (3,191) 100,504 (6,542) Total fixed maturity securities, available-for-sale 408,939 (32,893) 143,730 (23,302) 552,669 (56,195) Fixed maturity securities, held-to-maturity: Asset-backed securities 46,771 (5,696) — — 46,771 (5,696) Total fixed maturity securities, held-to-maturity: 46,771 (5,696) — — 46,771 (5,696) Total $ 455,710 $ (38,589) $ 143,730 $ (23,302) $ 599,440 $ (61,891) |
Gain (Loss) on Securities | The following table sets forth the components of net investment gains (losses) for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Gross realized gains Fixed maturity securities, available-for sale $ 493 $ 16 Equity securities 1,227 1,830 Other 1 31 Total 1,721 1,877 Gross realized losses Fixed maturity securities, available-for sale (237) (276) Equity securities (4,289) (654) Other (1) (16) Total (4,527) (946) Net unrealized gains (losses) on investments Equity securities 3,745 (5,369) Mortgage loans 22 — Net investment gains (losses) $ 961 $ (4,438) |
Investment Income | The following table sets forth the proceeds from sales of available-for-sale fixed maturity securities and equity securities for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for sale $ 8,392 $ 7,575 Equity securities 13,325 11,966 The following table sets forth the components of net investment income for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for sale $ 6,676 $ 3,224 Fixed maturity securities, held-to-maturity 1,003 1,937 Equity securities 726 738 Equity method investments (4,664) 9,210 Mortgage loans 1,473 818 Indirect loans (1,319) 1,657 Short-term investments and cash 1,789 27 Other (20) 7 Total investment income 5,664 17,618 Investment expenses (1,018) (2,469) Net investment income $ 4,646 $ 15,149 The Company’s gross investment income for mortgage loans for the three months ended March 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Retail $ 595 $ 359 Commercial 494 210 Multi-family 117 69 Office 106 166 Hospitality 161 14 $ 1,473 $ 818 |
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table sets forth the change in net unrealized gains (losses) on the Company’s investment portfolio, net of deferred income taxes, included in other comprehensive income (loss) for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities $ 9,786 $ (20,764) Deferred income taxes (2,045) 4,360 Total $ 7,741 $ (16,404) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurement Inputs and Valuation Techniques | The following table sets forth the range and weighted average, weighted by relative fair value, of the spread as of March 31, 2023: March 31, 2023 High 9.50 % Low 2.05 % Weighted average 5.85 % |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The following tables set forth the Company’s investments within the fair value hierarchy at March 31, 2023 and December 31, 2022: March 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 44,918 $ — $ — $ 44,918 Corporate securities and miscellaneous — 262,434 — 262,434 Municipal securities — 67,339 — 67,339 Residential mortgage-backed securities — 133,890 — 133,890 Commercial mortgage-backed securities — 52,182 — 52,182 Asset-backed securities — 112,374 — 112,374 Total fixed maturity securities, available-for-sale 44,918 628,219 — 673,137 Fixed maturity securities, held-to-maturity: Asset-backed securities — — 44,492 44,492 Total fixed maturity securities, held-to-maturity — — 44,492 44,492 Common stocks: Consumer discretionary 1,965 — — 1,965 Consumer staples 13,116 — — 13,116 Energy 2,947 — — 2,947 Finance 19,088 — — 19,088 Industrial 11,244 — — 11,244 Information technology 2,912 — — 2,912 Materials 3,253 — — 3,253 Other 2,292 — — 2,292 Total common stocks 56,817 — — 56,817 Preferred stocks: Consumer staples 473 — 473 Finance 3,979 — 3,979 Industrial — 1,135 — 1,135 Other — 735 — 735 Total preferred stocks — 6,322 — 6,322 Mutual funds: Fixed income 5,191 — — 5,191 Equity 51,615 — — 51,615 Commodity 520 — — 520 Total mutual funds 57,326 — — 57,326 Total equity securities 114,143 6,322 — 120,465 Mortgage loans — — 42,335 42,335 Short-term investments 287,351 — — 287,351 Total investments $ 446,412 $ 634,541 $ 86,827 $ 1,167,780 December 31, 2022 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 48,541 $ — $ — $ 48,541 Corporate securities and miscellaneous — 235,129 — 235,129 Municipal securities — 57,727 — 57,727 Residential mortgage-backed securities — 119,856 — 119,856 Commercial mortgage-backed securities — 36,495 — 36,495 Asset-backed securities — 109,824 — 109,824 Total fixed maturity securities, available-for-sale 48,541 559,031 — 607,572 Fixed maturity securities, held-to-maturity: Asset-backed securities — — 46,771 46,771 Total fixed maturity securities, held-to-maturity: — — 46,771 46,771 Common stocks: Consumer discretionary 1,948 — — 1,948 Consumer staples 12,036 — — 12,036 Energy 3,241 — — 3,241 Finance 22,636 — — 22,636 Industrial 9,452 — — 9,452 Information technology 2,284 — — 2,284 Materials 2,820 — — 2,820 Other 1,579 — — 1,579 Total common stocks 55,996 — — 55,996 Preferred stocks: Consumer staples — 117 — 117 Finance — 7,085 — 7,085 Industrial — 1,020 — 1,020 Other — 549 — 549 Total preferred stocks — 8,771 — 8,771 Mutual funds: Fixed income 5,068 — — 5,068 Equity 49,773 — — 49,773 Commodity 561 — — 561 Total mutual funds 55,402 — — 55,402 Total equity securities 111,398 8,771 — 120,169 Mortgage loans — — 52,842 52,842 Short-term investments 121,158 — — 121,158 Total investments $ 281,097 $ 567,802 $ 99,613 $ 948,512 |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation | The following table sets forth the changes in the fair value of instruments carried at fair value with a Level 3 measurement during the three months ended March 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total gains for the period recognized in net investment gains (losses) $ 22 Issuances $ 892 Settlements (11,421) Balance at March 31, 2023 $ 42,335 Total losses for the period recognized in net investment gains (losses) attributable to the change in unrealized gains or losses relating to assets held as of period end $ (14) |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation | The following table sets forth the changes in the fair value of instruments carried at fair value with a Level 3 measurement during the three months ended March 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total gains for the period recognized in net investment gains (losses) $ 22 Issuances $ 892 Settlements (11,421) Balance at March 31, 2023 $ 42,335 Total losses for the period recognized in net investment gains (losses) attributable to the change in unrealized gains or losses relating to assets held as of period end $ (14) |
Summary of Subordinated Debt | The following table sets forth the Company’s carrying and fair values of notes payable and subordinated debt as of March 31, 2023 and December 31, 2022: March 31, 2023 December 31, 2022 ($ in thousands) Carrying Fair Carrying Fair Notes Payable Term loan, due December 31, 2024 $ — $ — $ 50,000 $ 50,000 Revolving credit facility 50,000 50,000 — — Notes payable $ 50,000 $ 50,000 $ 50,000 $ 50,000 Subordinated Debt Junior subordinated interest debentures $ 59,149 $ 59,794 $ 59,137 $ 59,794 Unsecured subordinated notes 19,480 18,622 19,472 18,934 Subordinated debt, net of debt issuance costs $ 78,629 $ 78,416 $ 78,609 $ 78,728 |
Mortgage Loans (Tables)
Mortgage Loans (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable | The carrying value of the Company’s mortgage loans as of March 31, 2023 and December 31, 2022 were as follows: ($ in thousands) March 31, 2023 December 31, 2022 Retail $ 15,568 $ 16,516 Industrial — 6,329 Commercial 16,086 15,309 Multi-family 2,596 5,593 Office 3,210 3,197 Hospitality 4,875 4,915 $ 42,335 $ 51,859 |
Investment Income | The following table sets forth the proceeds from sales of available-for-sale fixed maturity securities and equity securities for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for sale $ 8,392 $ 7,575 Equity securities 13,325 11,966 The following table sets forth the components of net investment income for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for sale $ 6,676 $ 3,224 Fixed maturity securities, held-to-maturity 1,003 1,937 Equity securities 726 738 Equity method investments (4,664) 9,210 Mortgage loans 1,473 818 Indirect loans (1,319) 1,657 Short-term investments and cash 1,789 27 Other (20) 7 Total investment income 5,664 17,618 Investment expenses (1,018) (2,469) Net investment income $ 4,646 $ 15,149 The Company’s gross investment income for mortgage loans for the three months ended March 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Retail $ 595 $ 359 Commercial 494 210 Multi-family 117 69 Office 106 166 Hospitality 161 14 $ 1,473 $ 818 |
Other Long-Term Investments (Ta
Other Long-Term Investments (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Carrying Value of Equity Method Investments | The carrying value of the Company’s equity method investments as of March 31, 2023 and December 31, 2022 were as follows: ($ in thousands) March 31, 2023 December 31, 2022 Arena SOP LP units $ 6,683 $ 8,734 Arena Special Opportunities Fund, LP units 42,701 44,504 Brewer Lane Ventures Fund II LP units 390 200 Dowling Capital Partners LP units 2,231 1,965 Hudson Ventures Fund 2 LP units 3,391 3,551 JVM Funds LLC units 21,698 22,473 RISCOM 4,118 4,037 Universa Black Swan LP units 770 1,325 $ 81,982 $ 86,789 The following table sets forth the components of net investment (loss) income from equity method investments for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Arena SOP LP units $ (2,051) $ 6,117 Arena Special Opportunities Fund, LP units (1,730) 2,804 Dowling Capital Partners LP units 267 514 Hudson Ventures Fund 2 LP units (255) 64 JVM Funds LLC (420) 186 RISCOM 81 18 Universa Black Swan LP units (556) (493) $ (4,664) $ 9,210 The following table sets forth the unfunded commitment of equity method investments as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Brewer Lane Ventures Fund II LP units $ 4,610 $ 4,800 Dowling Capital Partners LP units 386 386 Hudson Ventures Fund 2 LP units 1,701 1,796 $ 6,697 $ 6,982 The following table sets forth the Company’s recorded investment in RISCOM compared to its share of underlying equity as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Investment in RISCOM: Underlying equity $ 2,434 $ 2,292 Difference 1,684 1,745 Recorded investment balance $ 4,118 $ 4,037 The following table sets forth the Company’s recorded investment in JVM Funds LLC compared to its share of underlying equity as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Investment in JVM Funds LLC: Underlying equity $ 20,828 $ 21,565 Difference 870 908 Recorded investment balance $ 21,698 $ 22,473 As of March 31, 2023 and December 31, 2022, the Company held indirect investments in collateralized loans and loan collateral through SMA1 and SMA2. The carrying value and unfunded commitment of the SMA1 and SMA2 as of March 31, 2023 and December 31, 2022 were as follows: March 31, 2023 December 31, 2022 ($ in thousands) Carrying Value Unfunded Commitment Carrying Value Unfunded Commitment SMA1 $ 34,654 $ — $ 36,426 $ — SMA2 (1) (1,652) — 2,010 — Investment in indirect loans and loan collateral $ 33,002 $ — $ 38,436 $ — (1) The carrying value of SMA2 is negative as of March 31, 2023 due to distribution in-transit. |
Allowance for Credit Losses (Ta
Allowance for Credit Losses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Credit Loss [Abstract] | |
Premium Receivable, Allowance for Credit Loss | The following table sets forth the changes in the allowance for expected credit losses for the three months ended March 31, 2023. ($ in thousands) Allowance for Credit Losses Balance at December 31, 2022 $ 629 Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 — Current period change for estimated uncollectible premiums 409 Write-offs of uncollectible premiums receivable (56) Balance at March 31, 2023 $ 982 |
Reinsurance Recoverable, Credit Quality Indicator | A summary of the Company’s reinsurance recoverables net of credit enhancements by A.M. Best rating as of March 31, 2023 was as follows: A.M. Best Rating March 31, 2023 A- and above 98.5 % B++ to B+ 1.4 Not rated 0.1 |
Reinsurance Recoverable, Allowance for Credit Loss | The following table sets forth the changes in the allowance for estimated uncollectible reinsurance for the three months ended March 31, 2023: ($ in thousands) Allowance for Credit Losses Balance at December 31, 2022 $ — Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 2,295 Current period change for estimated uncollectible reinsurance — Balance at March 31, 2023 $ 2,295 |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | he Company’s income tax expense and effective tax rates for the three months ended March 31, 2023 and 2022: ($ in thousands 2023 2022 Income tax expense $ 4,166 $ 4,269 Effective tax rate 21.1 % 20.7 % |
Losses and Loss Adjustment Ex_2
Losses and Loss Adjustment Expenses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Insurance [Abstract] | |
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | The following table sets forth the reconciliation of unpaid losses and loss adjustment expenses as reported in the condensed consolidated balance sheets as of and for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Reserves for losses and LAE, beginning of period $ 1,141,757 $ 979,549 Less: reinsurance recoverable on unpaid claims, beginning of period (435,986) (381,338) Reserves for losses and LAE, beginning of period, net of reinsurance 705,771 598,211 Incurred, net of reinsurance, related to: Current period 115,142 89,989 Prior years — — Total incurred, net of reinsurance 115,142 89,989 Paid, net of reinsurance, related to: Current period 8,744 10,605 Prior years 68,745 62,959 Total paid 77,489 73,564 Net reserves for losses and LAE, end of period 743,424 614,636 Plus: reinsurance recoverable on unpaid claims, end of period 429,752 385,146 Reserves for losses and LAE, end of period $ 1,173,176 $ 999,782 |
Commission and Fee Income (Tabl
Commission and Fee Income (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table sets forth the Company’s disaggregated revenues from contracts with customers for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 SUA commission revenue $ 857 $ 624 SUA fee income 456 (159) Other 179 (235) Total commission and fee income $ 1,492 $ 230 |
Underwriting, Acquisition and_2
Underwriting, Acquisition and Insurance Expenses (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Income and Expenses [Abstract] | |
Schedule of Underwriting, Acquisition and Insurance Expenses | The following table sets forth the components of underwriting, acquisition and insurance expenses for the three months ended March 31, 2023 and 2022: ($ in thousands) 2023 2022 Amortization of policy acquisition costs $ 21,235 $ 13,421 Other operating and general expenses 30,420 27,113 Total underwriting, acquisition and insurance expenses $ 51,655 $ 40,534 |
Reinsurance (Tables)
Reinsurance (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Insurance [Abstract] | |
Effects of Reinsurance | The following table sets forth the effects of reinsurance on premiums written and earned for the three months ended March 31, 2023 and 2022: 2023 2022 ($ in thousands) Written Earned Written Earned Direct premiums $ 308,213 $ 262,658 $ 248,635 $ 222,637 Assumed premiums 52,285 39,131 34,007 26,595 Ceded premiums (158,357) (118,958) (147,241) (107,506) Net premiums $ 202,141 $ 182,831 $ 135,401 $ 141,726 Ceded losses and LAE incurred $ 64,794 $ 61,527 |
Ceded Credit Risk | The following table sets forth the components of reinsurance recoverables and ceded unearned premium as of March 31, 2023 and December 31, 2022: ($ in thousands) March 31, 2023 December 31, 2022 Unpaid losses and loss adjustment expenses ceded $ 429,752 $ 435,986 Paid losses and loss adjustment expense ceded 107,463 107,228 Loss portfolio transfer 35,584 38,145 Allowance for credit losses (2,295) — Reinsurance recoverables $ 570,504 $ 581,359 Ceded unearned premium $ 197,044 $ 157,645 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Summary of Equity Awards | The following table sets forth the Company’s equity awards, target payout ranges and authorized target restricted stock and stock units for the three months ended March 31, 2023 and 2022: Award Requisite Target Three months ended March 31, 2023 Market condition awards 0%–150% 3 years 37,622 Performance condition awards 0%–150% 3 years 91,350 Service condition awards N/A 1–4 years 944,522 Stock options N/A 3–4 years 759,990 1,833,484 Three months ended March 31, 2022 Market condition awards 0%–150% 3 years 28,495 Performance condition awards 0%–150% 3 years 26,214 Service condition awards N/A 1–3 years 136,982 191,691 The following table sets forth option activity for the three months ended March 31, 2023: Weighted-Average Stock Outstanding at January 1, 2023 — Granted $ 15.00 759,990 Exercised — Forfeited — Outstanding at March 31, 2023 $ 15.00 759,990 |
Schedule of Nonvested Share Activity | The following table sets forth the Company’s restricted stock and restricted stock units activity for the three months ended March 31, 2023 and 2022: Weighted-Average Stock and Stock Units Non-vested at January 1, 2023 $ 12.55 419,896 Granted 15.85 1,073,494 Vested 12.91 (32,496) Forfeited 15.10 (7,459) Non-vested at March 31, 2023 $ 14.97 1,453,435 Non-vested at January 1, 2022 $ 13.23 375,643 Granted 13.16 191,691 Vested 12.47 (55,851) Forfeited $ — — Non-vested at March 31, 2022 $ 13.28 511,483 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth a reconciliation of the numerator and denominator of basic and diluted earnings per share computations contained in the period-ended consolidated financial statements for the three months ended March 31, 2023 and 2022: ($ in thousands, except for share and per share amounts) 2023 2022 Numerator Net income $ 15,556 $ 16,311 Less: Undistributed income allocated to participating securities (1,274) (7,823) Net income attributable to common shareholders (numerator for basic earnings per share) 14,282 8,488 Add back: Undistributed income allocated to participating securities 1,274 7,823 Net income (numerator for diluted earnings per share under the two-class method) $ 15,556 $ 16,311 Denominator Basic weighted-average common shares 32,848,243 16,376,720 Preferred shares (if converted method) 2,931,256 15,092,585 Contingently issuable instruments (treasury stock method) 708,746 714,185 Market condition awards (contingently issuable) 87,750 40,460 Performance awards (contingently issuable) 38,441 32,362 Restricted stock units (treasury stock method) 318,421 155,995 Options (treasury stock method) 19,216 — Diluted weighted-average common share equivalents 36,952,073 32,412,307 Basic earnings per share $ 0.43 $ 0.52 Diluted earnings per share $ 0.42 $ 0.50 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table sets forth the weighted-average instruments that were excluded from the calculation of diluted weighted-average common share equivalents during the three months ended March 31, 2023 and 2022. 2023 2022 Contingently issuable instruments (treasury stock method) 345,764 — Market condition awards (contingently issuable) 13,795 — Performance awards (contingently issuable) 40,080 — Restricted stock units (treasury stock method) 390,076 — Options (treasury stock method) 333,551 — 2023 2022 Common shares 1,054,510 183,604 Preferred shares, if converted — 1,216,389 Total 1,054,510 1,399,993 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Net earned premium and gross commission expense related to these agreements for the three months ended March 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Net earned premium $ 22,185 $ 21,018 Commissions 6,853 7,348 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders’ equity (accumulated deficit) | $ 507,146 | $ 421,662 | $ 428,619 | $ 426,080 |
Period of adoption, adjustment | ||||
Accumulated Other Comprehensive Income (Loss) [Line Items] | ||||
Stockholders’ equity (accumulated deficit) | $ (2,276) |
Investments - Debt Securities,
Investments - Debt Securities, Trading, and Equity Securities, FV-NI (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | $ 718,395 | $ 662,616 |
Gross Unrealized Gains | 2,657 | 1,151 |
Gross Unrealized Losses | (47,915) | (56,195) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 673,137 | 607,572 |
Fixed maturity securities, held-to-maturity: | ||
Gross Amortized Cost | 48,537 | 52,467 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (3,724) | (5,696) |
Allowance for Credit Losses | (321) | |
Total fixed maturity securities, held-to-maturity | 44,492 | 46,771 |
U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 46,347 | 50,416 |
Gross Unrealized Gains | 35 | 1 |
Gross Unrealized Losses | (1,464) | (1,876) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 44,918 | 48,541 |
Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 278,980 | 255,116 |
Gross Unrealized Gains | 1,571 | 767 |
Gross Unrealized Losses | (18,117) | (20,754) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 262,434 | 235,129 |
Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 73,232 | 65,836 |
Gross Unrealized Gains | 152 | 24 |
Gross Unrealized Losses | (6,045) | (8,133) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 67,339 | 57,727 |
Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 146,830 | 134,844 |
Gross Unrealized Gains | 458 | 218 |
Gross Unrealized Losses | (13,398) | (15,206) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 133,890 | 119,856 |
Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 55,183 | 40,129 |
Gross Unrealized Gains | 228 | 50 |
Gross Unrealized Losses | (3,229) | (3,684) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 52,182 | 36,495 |
Asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Gross Amortized Cost | 117,823 | 116,275 |
Gross Unrealized Gains | 213 | 91 |
Gross Unrealized Losses | (5,662) | (6,542) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 112,374 | 109,824 |
Fixed maturity securities, held-to-maturity: | ||
Gross Amortized Cost | 48,537 | 52,467 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (3,724) | (5,696) |
Allowance for Credit Losses | (321) | |
Total fixed maturity securities, held-to-maturity | $ 44,492 | $ 46,771 |
Investments - Investments Class
Investments - Investments Classified by Contractual Maturity Date (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Amortized Cost | ||
Due in less than one year | $ 27,656 | |
Due after one year through five years | 214,722 | |
Due after five years through ten years | 108,566 | |
Due after ten years | 47,615 | |
Gross Amortized Cost | 718,395 | $ 662,616 |
Fair Value | ||
Due in less than one year | 26,956 | |
Due after one year through five years | 205,835 | |
Due after five years through ten years | 99,254 | |
Due after ten years | 42,646 | |
Total | 673,137 | 607,572 |
Mortgage-backed securities | ||
Amortized Cost | ||
Without single maturity date | 202,013 | |
Fair Value | ||
Without single maturity date | 186,072 | |
Asset-backed securities | ||
Amortized Cost | ||
Without single maturity date | 117,823 | |
Fair Value | ||
Without single maturity date | 112,374 | |
Total | $ 112,374 | $ 109,824 |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Loss on Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Available for sale, fair value | ||
Less than 12 Months | $ 295,514 | $ 408,939 |
12 Months or More | 252,840 | 143,730 |
Total | 548,354 | 552,669 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (11,690) | (32,893) |
12 Months or More | (36,225) | (23,302) |
Total | (47,915) | (56,195) |
Held-to-maturity, fair value | ||
Less than 12 Months | 1,624 | 46,771 |
12 Months or More | 42,868 | 0 |
Total | 44,492 | 46,771 |
Held-to-maturity, gross unrealized losses | ||
Less than 12 Months | (19) | (5,696) |
12 Months or More | (3,705) | 0 |
Total | (3,724) | (5,696) |
Available-for-sale and held-to-maturity, fair value | ||
Less than 12 Months | 297,138 | 455,710 |
12 Months or More | 295,708 | 143,730 |
Total | 592,846 | 599,440 |
Available-for-sale and held-to-maturity, gross unrealized losses | ||
Less than 12 Months | (11,709) | (38,589) |
12 Months or More | (39,930) | (23,302) |
Total | (51,639) | (61,891) |
U.S. government securities | ||
Available for sale, fair value | ||
Less than 12 Months | 19,722 | 28,966 |
12 Months or More | 18,777 | 18,577 |
Total | 38,499 | 47,543 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (443) | (603) |
12 Months or More | (1,021) | (1,273) |
Total | (1,464) | (1,876) |
Corporate securities and miscellaneous | ||
Available for sale, fair value | ||
Less than 12 Months | 107,567 | 171,506 |
12 Months or More | 98,368 | 34,283 |
Total | 205,935 | 205,789 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (4,059) | (16,063) |
12 Months or More | (14,058) | (4,691) |
Total | (18,117) | (20,754) |
Municipal securities | ||
Available for sale, fair value | ||
Less than 12 Months | 35,247 | 51,701 |
12 Months or More | 22,752 | 3,689 |
Total | 57,999 | 55,390 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (1,764) | (7,236) |
12 Months or More | (4,281) | (897) |
Total | (6,045) | (8,133) |
Residential mortgage-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 41,507 | 56,246 |
12 Months or More | 65,869 | 52,778 |
Total | 107,376 | 109,024 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (1,919) | (4,152) |
12 Months or More | (11,479) | (11,054) |
Total | (13,398) | (15,206) |
Commercial mortgage-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 28,658 | 25,836 |
12 Months or More | 11,393 | 8,583 |
Total | 40,051 | 34,419 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (869) | (1,488) |
12 Months or More | (2,360) | (2,196) |
Total | (3,229) | (3,684) |
Asset-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 62,813 | 74,684 |
12 Months or More | 35,681 | 25,820 |
Total | 98,494 | 100,504 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (2,636) | (3,351) |
12 Months or More | (3,026) | (3,191) |
Total | (5,662) | (6,542) |
Held-to-maturity, fair value | ||
Less than 12 Months | 1,624 | 46,771 |
12 Months or More | 42,868 | 0 |
Total | 44,492 | 46,771 |
Held-to-maturity, gross unrealized losses | ||
Less than 12 Months | (19) | (5,696) |
12 Months or More | (3,705) | 0 |
Total | $ (3,724) | $ (5,696) |
Investments - Narrative (Detail
Investments - Narrative (Details) | Mar. 31, 2023 position |
Investments, Debt and Equity Securities [Abstract] | |
Unrealized loss position aged over 12 months, number of positions | 551 |
Investments - Net Investment Lo
Investments - Net Investment Losses (Gains) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Gross realized gains | ||
Fixed maturity securities, available-for sale | $ 493 | $ 16 |
Equity securities | 1,227 | 1,830 |
Other | 1 | 31 |
Total | 1,721 | 1,877 |
Gross realized losses | ||
Fixed maturity securities, available-for sale | (237) | (276) |
Equity securities | (4,289) | (654) |
Other | (1) | (16) |
Total | (4,527) | (946) |
Net unrealized gains (losses) on investments | ||
Equity securities | 3,745 | (5,369) |
Mortgage loans | 22 | 0 |
Net investment gains (losses) | $ 961 | $ (4,438) |
Investments - Proceeds from Sal
Investments - Proceeds from Sales (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | ||
Fixed maturity securities, available-for sale | $ 8,392 | $ 7,575 |
Equity securities | $ 13,325 | $ 11,966 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Net Investment Income [Line Items] | ||
Total investment income | $ 5,664 | $ 17,618 |
Investment expenses | (1,018) | (2,469) |
Net investment income | 4,646 | 15,149 |
Fixed maturity securities, available-for sale | ||
Net Investment Income [Line Items] | ||
Total investment income | 6,676 | 3,224 |
Fixed maturity securities, held-to-maturity | ||
Net Investment Income [Line Items] | ||
Total investment income | 1,003 | 1,937 |
Equity securities | ||
Net Investment Income [Line Items] | ||
Total investment income | 726 | 738 |
Equity method investments | ||
Net Investment Income [Line Items] | ||
Total investment income | (4,664) | 9,210 |
Mortgage loans | ||
Net Investment Income [Line Items] | ||
Total investment income | 1,473 | 818 |
Indirect loans | ||
Net Investment Income [Line Items] | ||
Total investment income | (1,319) | 1,657 |
Short-term investments and cash | ||
Net Investment Income [Line Items] | ||
Total investment income | 1,789 | 27 |
Other | ||
Net Investment Income [Line Items] | ||
Total investment income | $ (20) | $ 7 |
Investments - Schedule of Accum
Investments - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | ||
Fixed maturity securities | $ 9,786 | $ (20,764) |
Deferred income taxes | (2,045) | 4,360 |
Total other comprehensive income (loss) | $ 7,741 | $ (16,404) |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurement Inputs and Valuation Techniques (Details) - Level 3 - Measurement Input, Incremental Cost of Capital | Mar. 31, 2023 |
High | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 9.50% |
Low | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 2.05% |
Weighted average | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 5.85% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | $ 673,137 | $ 607,572 |
Total fixed maturity securities, held-to-maturity | 44,492 | 46,771 |
Equity securities, at fair value | 120,465 | 120,169 |
Mortgage loans | 42,335 | 52,842 |
Short-term investments | 287,351 | 121,158 |
Total investments | 1,167,780 | 948,512 |
U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,918 | 48,541 |
Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 262,434 | 235,129 |
Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 67,339 | 57,727 |
Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 133,890 | 119,856 |
Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 52,182 | 36,495 |
Asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 112,374 | 109,824 |
Total fixed maturity securities, held-to-maturity | 44,492 | 46,771 |
Common stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 56,817 | 55,996 |
Common stocks: | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,965 | 1,948 |
Common stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 13,116 | 12,036 |
Common stocks: | Energy | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,947 | 3,241 |
Common stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 19,088 | 22,636 |
Common stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 11,244 | 9,452 |
Common stocks: | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,912 | 2,284 |
Common stocks: | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,253 | 2,820 |
Common stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,292 | 1,579 |
Preferred stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 6,322 | 8,771 |
Preferred stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 473 | 117 |
Preferred stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,979 | 7,085 |
Preferred stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,135 | 1,020 |
Preferred stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 735 | 549 |
Mutual funds: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 57,326 | 55,402 |
Mutual funds: | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,191 | 5,068 |
Mutual funds: | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 51,615 | 49,773 |
Mutual funds: | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 520 | 561 |
Level 1 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,918 | 48,541 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Equity securities, at fair value | 114,143 | 111,398 |
Mortgage loans | 0 | 0 |
Short-term investments | 287,351 | 121,158 |
Total investments | 446,412 | 281,097 |
Level 1 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,918 | 48,541 |
Level 1 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 1 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 1 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 1 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 1 | Asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Level 1 | Common stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 56,817 | 55,996 |
Level 1 | Common stocks: | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,965 | 1,948 |
Level 1 | Common stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 13,116 | 12,036 |
Level 1 | Common stocks: | Energy | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,947 | 3,241 |
Level 1 | Common stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 19,088 | 22,636 |
Level 1 | Common stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 11,244 | 9,452 |
Level 1 | Common stocks: | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,912 | 2,284 |
Level 1 | Common stocks: | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,253 | 2,820 |
Level 1 | Common stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,292 | 1,579 |
Level 1 | Preferred stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 1 | Preferred stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | |
Level 1 | Preferred stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | |
Level 1 | Preferred stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 1 | Preferred stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 1 | Mutual funds: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 57,326 | 55,402 |
Level 1 | Mutual funds: | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,191 | 5,068 |
Level 1 | Mutual funds: | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 51,615 | 49,773 |
Level 1 | Mutual funds: | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 520 | 561 |
Level 2 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 628,219 | 559,031 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Equity securities, at fair value | 6,322 | 8,771 |
Mortgage loans | 0 | 0 |
Short-term investments | 0 | 0 |
Total investments | 634,541 | 567,802 |
Level 2 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 2 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 262,434 | 235,129 |
Level 2 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 67,339 | 57,727 |
Level 2 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 133,890 | 119,856 |
Level 2 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 52,182 | 36,495 |
Level 2 | Asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 112,374 | 109,824 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Level 2 | Common stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Energy | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Common stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Preferred stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 6,322 | 8,771 |
Level 2 | Preferred stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 473 | 117 |
Level 2 | Preferred stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,979 | 7,085 |
Level 2 | Preferred stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,135 | 1,020 |
Level 2 | Preferred stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 735 | 549 |
Level 2 | Mutual funds: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Mutual funds: | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Mutual funds: | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 2 | Mutual funds: | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Total fixed maturity securities, held-to-maturity | 44,492 | 46,771 |
Equity securities, at fair value | 0 | 0 |
Mortgage loans | 42,335 | 52,842 |
Short-term investments | 0 | 0 |
Total investments | 86,827 | 99,613 |
Level 3 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 3 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 3 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 3 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 3 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Level 3 | Asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Total fixed maturity securities, held-to-maturity | 44,492 | 46,771 |
Level 3 | Common stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Energy | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Common stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Preferred stocks: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Preferred stocks: | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Preferred stocks: | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Preferred stocks: | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Preferred stocks: | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Mutual funds: | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Mutual funds: | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Mutual funds: | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Level 3 | Mutual funds: | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | $ 0 | $ 0 |
Fair Value Measurements - Fai_2
Fair Value Measurements - Fair Value, Measure on Recurring Basis, Unobservable Input Reconciliation (Details) - Mortgage Loans $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ 52,842 |
Total gains for the period recognized in net investment gains (losses) | 22 |
Issuances | 892 |
Settlements | (11,421) |
Ending balance | 42,335 |
Total losses for the period recognized in net investment gains (losses) attributable to the change in unrealized gains or losses relating to assets held as of period end | $ (14) |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Subordinated Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Term loan, due December 31, 2024 | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 0 | $ 50,000 |
Term loan, due December 31, 2024 | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 0 | 50,000 |
Revolving credit facility | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 50,000 | 0 |
Revolving credit facility | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 50,000 | 0 |
Notes payable | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 50,000 | 50,000 |
Notes payable | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 50,000 | 50,000 |
Junior subordinated interest debentures | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 59,149 | 59,137 |
Junior subordinated interest debentures | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 59,794 | 59,794 |
Unsecured subordinated notes | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 19,480 | 19,472 |
Unsecured subordinated notes | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 18,622 | 18,934 |
Subordinated debt, net of debt issuance costs | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 78,629 | 78,609 |
Subordinated debt, net of debt issuance costs | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 78,416 | $ 78,728 |
Mortgage Loans - Narrative (Det
Mortgage Loans - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Mortgage loans in foreclosure | $ 0 | $ 6.4 |
Low | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans held-for-investment, term | 1 year | |
Percentage of property appraisal value | 40% | |
High | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans held-for-investment, term | 2 years | |
Percentage of property appraisal value | 80% |
Mortgage Loans - Portfolios (De
Mortgage Loans - Portfolios (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | $ 42,335 | $ 51,859 | |
Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | 1,473 | $ 818 | |
Retail | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 15,568 | 16,516 | |
Retail | Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | 595 | 359 | |
Industrial | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 0 | 6,329 | |
Commercial | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 16,086 | 15,309 | |
Commercial | Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | 494 | 210 | |
Multi-family | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 2,596 | 5,593 | |
Multi-family | Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | 117 | 69 | |
Office | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 3,210 | 3,197 | |
Office | Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | 106 | 166 | |
Hospitality | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total mortgage loans | 4,875 | $ 4,915 | |
Hospitality | Mortgage loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Total investment income | $ 161 | $ 14 |
Other Long-Term Investments - N
Other Long-Term Investments - Narrative (Details) | 3 Months Ended |
Mar. 31, 2023 | |
RISCOM | |
Schedule of Equity Method Investments [Line Items] | |
Useful life | 15 years |
Other Long-Term Investments - C
Other Long-Term Investments - Carrying Value of Equity Method Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 81,982 | $ 86,789 |
Arena SOP LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 6,683 | 8,734 |
Arena Special Opportunities Fund, LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 42,701 | 44,504 |
Brewer Lane Ventures Fund II LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 390 | 200 |
Dowling Capital Partners LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 2,231 | 1,965 |
Hudson Ventures Fund 2 LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 3,391 | 3,551 |
JVM Funds LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 21,698 | 22,473 |
RISCOM | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 4,118 | 4,037 |
Universa Black Swan LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 770 | $ 1,325 |
Other Long-Term Investments -_2
Other Long-Term Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | $ 4,646 | $ 15,149 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (4,664) | 9,210 |
Arena SOP LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (2,051) | 6,117 |
Arena Special Opportunities Fund, LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (1,730) | 2,804 |
Dowling Capital Partners LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | 267 | 514 |
Hudson Ventures Fund 2 LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (255) | 64 |
JVM Funds LLC | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (420) | 186 |
RISCOM | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | 81 | 18 |
Universa Black Swan LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | $ (556) | $ (493) |
Other Long-Term Investments - U
Other Long-Term Investments - Unfunded Commitment of Equity Method Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Unfunded Commitment | $ 6,697 | $ 6,982 |
Brewer Lane Ventures Fund II LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Unfunded Commitment | 4,610 | 4,800 |
Dowling Capital Partners LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Unfunded Commitment | 386 | 386 |
Hudson Ventures Fund 2 LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Unfunded Commitment | $ 1,701 | $ 1,796 |
Other Long-Term Investments - I
Other Long-Term Investments - Investment in RISCOM (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity [Abstract] | ||
Recorded investment balance | $ 81,982 | $ 86,789 |
RISCOM | ||
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity [Abstract] | ||
Underlying equity | 2,434 | 2,292 |
Difference | 1,684 | 1,745 |
Recorded investment balance | $ 4,118 | $ 4,037 |
Other Long-Term Investments -_3
Other Long-Term Investments - Investment in JVN Funds (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 81,982 | $ 86,789 |
JVM Funds LLC | ||
Schedule of Equity Method Investments [Line Items] | ||
Underlying equity | 20,828 | 21,565 |
Difference | 870 | 908 |
Recorded investment balance | $ 21,698 | $ 22,473 |
Other Long-Term Investments - S
Other Long-Term Investments - Schedule of Indirect Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Carrying Value | $ 81,982 | $ 86,789 |
Unfunded Commitment | 6,697 | 6,982 |
Investment in indirect loans and loan collateral | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying Value | 33,002 | 38,436 |
Unfunded Commitment | 0 | 0 |
Investment in indirect loans and loan collateral | SMA1 | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying Value | 34,654 | 36,426 |
Unfunded Commitment | 0 | 0 |
Investment in indirect loans and loan collateral | SMA2 | ||
Schedule of Equity Method Investments [Line Items] | ||
Carrying Value | (1,652) | 2,010 |
Unfunded Commitment | $ 0 | $ 0 |
Allowance for Credit Losses - P
Allowance for Credit Losses - Premium Receivable (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Premium Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 629 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 | 982 |
Current period change for estimated uncollectible premiums | 409 |
Write-offs of uncollectible premiums receivable | (56) |
Ending balance | 982 |
Period of adoption, adjustment | |
Premium Receivable, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 0 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 |
Allowance for Credit Losses- Re
Allowance for Credit Losses- Reinsurance Recoverable, Credit Quality Indicator (Details) - Reinsurer concentration risk - Reinsurance recoverable including reinsurance premium paid | 3 Months Ended |
Mar. 31, 2023 | |
A- and above | |
Ceded Credit Risk [Line Items] | |
Concentration risk, percentage | 98.50% |
B++ to B+ | |
Ceded Credit Risk [Line Items] | |
Concentration risk, percentage | 1.40% |
Not rated | |
Ceded Credit Risk [Line Items] | |
Concentration risk, percentage | 0.10% |
Allowance for Credit Losses - R
Allowance for Credit Losses - Reinsurance Recoverable (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Reinsurance Recoverable, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 0 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 | 2,295 |
Current period change for estimated uncollectible reinsurance | 0 |
Ending balance | 2,295 |
Period of adoption, adjustment | |
Reinsurance Recoverable, Allowance for Credit Loss [Roll Forward] | |
Beginning balance | $ 2,295 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 |
Notes_Payable - Narrative (Deta
Notes Payable - Narrative (Details) - Revolving credit facility - Line of Credit | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Revolving credit facility | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ 150,000,000 |
Accordion feature, increase limit | 50,000,000 |
Proceeds from long-term debt | 50,000,000 |
Letter of Credit | |
Debt Instrument [Line Items] | |
Maximum borrowing capacity | $ 30,000,000 |
Secured Overnight Financing Rate (SOFR) | Revolving credit facility | Low | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 1.50% |
Secured Overnight Financing Rate (SOFR) | Revolving credit facility | High | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 1.90% |
Credit Spread Adjustment | Revolving credit facility | Low | |
Debt Instrument [Line Items] | |
Basis spread on variable rate | 0.10% |
Stockholders_ Equity - Narrativ
Stockholders’ Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||||
Jan. 18, 2023 | Jan. 12, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Apr. 24, 2020 | |
Subsidiary, Sale of Stock [Line Items] | ||||||
Common stock, par value (in USD per share) | $ 0.01 | $ 0.01 | ||||
Proceeds from initial public offering | $ 66,262 | $ 0 | ||||
Common stock, shares authorized (in shares) | 500,000,000 | 168,000,000 | ||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 2,000,000 | ||||
Preferred stock, par value (in USD per share) | $ 0.01 | $ 0.01 | ||||
Preferred stock, liquidation preference (in dollars per share) | $ 50 | |||||
Preferred stock, shares outstanding (in shares) | 1,969,660 | 0 | 1,969,660 | |||
Common shares upon conversion of preferred shares (in shares) | 16,305,113 | |||||
Preferred stock, convertible, conversion price (in dollars per share) | $ 6.04 | |||||
Convertible preferred stock (in shares) | 16,305,113 | |||||
IPO | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 8,952,383 | |||||
Sale of stock, price per share (usd per share) | $ 15 | |||||
Proceeds from initial public offering | $ 62,400 | |||||
IPO - Shares From Company | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 4,750,000 | |||||
IPO - Shares From Existing Shareholders | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 4,202,383 | |||||
Over-Allotment Option | ||||||
Subsidiary, Sale of Stock [Line Items] | ||||||
Sale of stock, number of shares issued (in shares) | 1,342,857 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income tax expense | $ 4,166 | $ 4,269 |
Effective tax rate | 21.10% | 20.70% |
Losses and Loss Adjustment Ex_3
Losses and Loss Adjustment Expenses - Schedule of Liability for Unpaid Claims and Claims Adjustment Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Reserves for losses and LAE, beginning of period | $ 1,141,757 | $ 979,549 |
Less: reinsurance recoverable on unpaid claims, beginning of period | (435,986) | (381,338) |
Reserves for losses and LAE, beginning of period, net of reinsurance | 705,771 | 598,211 |
Incurred, net of reinsurance, related to: | ||
Current period | 115,142 | 89,989 |
Prior years | 0 | 0 |
Total incurred, net of reinsurance | 115,142 | 89,989 |
Paid, net of reinsurance, related to: | ||
Current period | 8,744 | 10,605 |
Prior years | 68,745 | 62,959 |
Total paid | 77,489 | 73,564 |
Net reserves for losses and LAE, end of period | 743,424 | 614,636 |
Plus: reinsurance recoverable on unpaid claims, end of period | 429,752 | 385,146 |
Reserves for losses and LAE, end of period | $ 1,173,176 | $ 999,782 |
Commission and Fee Income (Deta
Commission and Fee Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | $ 1,492 | $ 230 |
SUA commission revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | 857 | 624 |
SUA fee income | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | 456 | (159) |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | $ 179 | $ (235) |
Commission and Fee Income - Nar
Commission and Fee Income - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | ||||
Contract asset after allowance for credit loss | $ 1,300 | $ 1,300 | $ 800 | $ 1,200 |
Underwriting, Acquisition and_3
Underwriting, Acquisition and Insurance Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Other Income and Expenses [Abstract] | ||
Amortization of policy acquisition costs | $ 21,235 | $ 13,421 |
Other operating and general expenses | 30,420 | 27,113 |
Total underwriting, acquisition and insurance expenses | $ 51,655 | $ 40,534 |
Reinsurance - Schedule of Premi
Reinsurance - Schedule of Premiums Written and Earned (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Written | ||
Direct premiums | $ 308,213 | $ 248,635 |
Assumed premiums | 52,285 | 34,007 |
Ceded premiums | (158,357) | (147,241) |
Net premiums | 202,141 | 135,401 |
Earned | ||
Direct premiums | 262,658 | 222,637 |
Assumed premiums | 39,131 | 26,595 |
Ceded premiums | (118,958) | (107,506) |
Net premiums | 182,831 | 141,726 |
Ceded losses and LAE incurred | $ 64,794 | $ 61,527 |
Reinsurance - Reinsurance Recov
Reinsurance - Reinsurance Recoverables and Ceded Premiums (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Insurance [Abstract] | ||||
Unpaid losses and loss adjustment expenses ceded | $ 429,752 | $ 435,986 | $ 385,146 | $ 381,338 |
Paid losses and loss adjustment expense ceded | 107,463 | 107,228 | ||
Loss portfolio transfer | 35,584 | 38,145 | ||
Allowance for credit losses | (2,295) | 0 | ||
Reinsurance recoverables | 570,504 | 581,359 | ||
Ceded unearned premium | $ 197,044 | $ 157,645 |
Reinsurance - Narrative (Detail
Reinsurance - Narrative (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Insurance [Abstract] | ||
Market value of trust funds | $ 127,100 | |
Deposit asset | $ 36,800 | $ 41,800 |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Jan. 12, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 3,200,516 | ||
Options granted (in shares) | 759,990 | ||
Aggregate intrinsic value of options | $ 5,200 | ||
Weighted average remaining contractual life of options | 9 years 9 months 18 days | ||
Unrecognized compensation cost | $ 22,200 | ||
Unrecognized compensation cost, recognition period | 2 years 1 month 6 days | ||
Stock based compensation expense | $ 1,900 | $ 500 | |
Restricted Stock Awards And Units | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Granted (in shares) | 1,073,494 | 191,691 | |
Fair value of shares vested in period | $ 700 | $ 700 | |
Options (treasury stock method) | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Contractual term | 10 years | ||
Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 1,833,484 | 191,691 | |
Stock options granted to employees | $ 4,400 | ||
Long Term Incentive Plan | Restricted Stock Awards And Units | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Granted (in shares) | 1,073,494 | 191,691 | |
Shares granted, value | $ 17,000 | $ 2,500 | |
Long Term Incentive Plan | Options (treasury stock method) | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 759,990 | ||
Long Term Incentive Plan | Low | Options (treasury stock method) | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite service period | 3 years | ||
Long Term Incentive Plan | High | Options (treasury stock method) | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite service period | 4 years | ||
Long Term Incentive Plan | Director | Restricted Stock | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Granted (in shares) | 3,332 | 15,196 | |
Requisite service period | 1 year |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Equity Awards (Details) - shares | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Jan. 12, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 3,200,516 | ||
Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 1,833,484 | 191,691 | |
Market condition awards | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 3 years | 3 years | |
Authorized target common shares (in shares) | 37,622 | 28,495 | |
Market condition awards | Low | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 0% | 0% | |
Market condition awards | High | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 150% | 150% | |
Performance condition awards | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 3 years | 3 years | |
Authorized target common shares (in shares) | 91,350 | 26,214 | |
Performance condition awards | Low | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 0% | 0% | |
Performance condition awards | High | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 150% | 150% | |
Service condition awards | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 944,522 | 136,982 | |
Service condition awards | Low | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 1 year | 1 year | |
Service condition awards | High | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 4 years | 3 years | |
Options (treasury stock method) | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 759,990 | ||
Options (treasury stock method) | Low | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 3 years | ||
Options (treasury stock method) | High | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 4 years |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of Options Activity (Details) | 3 Months Ended |
Mar. 31, 2023 $ / shares shares | |
Stock | |
Outstanding, beginning of period (in shares) | 0 |
Granted (in shares) | 759,990 |
Exercised (in shares) | 0 |
Forfeited (in shares) | 0 |
Outstanding, ending of period (in shares) | 759,990 |
Weighted-Average Exercise Price | |
Granted, weighted average exercise price (in usd per share) | $ / shares | $ 15 |
Outstanding, weighted average exercise price (in usd per share) | $ / shares | $ 15 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Nonvested Share Activity (Details) - Restricted Stock Awards And Units - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Weighted-Average Grant-Date Fair Value | ||
Non-vested, beginning period (in dollars per share) | $ 12.55 | $ 13.23 |
Granted (in dollars per share) | 15.85 | 13.16 |
Vested (in dollars per share) | 12.91 | 12.47 |
Forfeited (in dollars per share) | 15.10 | 0 |
Non-vested, ending period (in dollars per share) | $ 14.97 | $ 13.28 |
Stock and Stock Units | ||
Non-vested, beginning period (in shares) | 419,896 | 375,643 |
Granted (in shares) | 1,073,494 | 191,691 |
Vested (in shares) | (32,496) | (55,851) |
Forfeited (in shares) | (7,459) | 0 |
Non-vested, ending period (in shares) | 1,453,435 | 511,483 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Numerator | ||
Net income | $ 15,556 | $ 16,311 |
Less: Undistributed income allocated to participating securities | (1,274) | (7,823) |
Net income attributable to common shareholders | 14,282 | 8,488 |
Add back: Undistributed income allocated to participating securities | 1,274 | 7,823 |
Net income (numerator for diluted earnings per share under the two-class method) | $ 15,556 | $ 16,311 |
Denominator | ||
Basic (in shares) | 32,848,243 | 16,376,720 |
Preferred shares (if converted method) (in shares) | 2,931,256 | 15,092,585 |
Contingently issuable instruments (treasury stock method) (in shares) | 708,746 | 714,185 |
Diluted weighted-average common share equivalents (in shares) | 36,952,073 | 32,412,307 |
Basic earnings per share (in dollar per share) | $ 0.43 | $ 0.52 |
Diluted earnings per share (in dollar per share) | $ 0.42 | $ 0.50 |
Market condition awards | ||
Denominator | ||
Awards (in shares) | 87,750 | 40,460 |
Performance condition awards | ||
Denominator | ||
Awards (in shares) | 38,441 | 32,362 |
Stock options | ||
Denominator | ||
Awards (in shares) | 318,421 | 155,995 |
Options (treasury stock method) | ||
Denominator | ||
Awards (in shares) | 19,216 | 0 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Contingently issuable instruments (treasury stock method) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 345,764 | 0 |
Market condition awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 13,795 | 0 |
Performance condition awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 40,080 | 0 |
Stock options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 390,076 | 0 |
Options (treasury stock method) | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 333,551 | 0 |
Earnings Per Share - Schedule_3
Earnings Per Share - Schedule of Earnings Per Share, Excluded from Basic Earnings (Details) - shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Total | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 1,054,510 | 1,399,993 |
Common shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 1,054,510 | 183,604 |
Preferred shares, if converted | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 1,216,389 |
Related Party Transactions - We
Related Party Transactions - Westaim Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||
Unrealized loss | $ 3,745 | $ (5,369) | |
Skyward Specialty Insurance Group | Westaim HIIG LP | |||
Related Party Transaction [Line Items] | |||
Ownership interest | 39% | 44.50% | |
Limited partner | Westaim | |||
Related Party Transaction [Line Items] | |||
Unrealized loss | $ (1,500) | $ (2,300) |
Related Party Transactions - RI
Related Party Transactions - RISCOM Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2016 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||||
Net earned premium | $ 182,831 | $ 141,726 | ||
Premiums receivable, net | 178,954 | $ 139,215 | ||
Affiliated entity | Agency agreement | RISCOM | ||||
Related Party Transaction [Line Items] | ||||
Agreement, ownership interest | 20% | |||
Net earned premium | 22,185 | 21,018 | ||
Commissions | 6,853 | $ 7,348 | ||
Premiums receivable, net | $ 17,600 | $ 9,900 |
Related Party Transactions - Re
Related Party Transactions - Resinsurance Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | |||
Ceded premiums earned | $ 118,958 | $ 107,506 | |
Reinsurance recoverable for paid and unpaid claims | $ 570,504 | $ 581,359 | |
Everest Reinsurance Co | Reinsurance agreement | Affiliated entity | |||
Related Party Transaction [Line Items] | |||
Ceded premiums earned | $ 19,600 | ||
Reinsurance recoverable for paid and unpaid claims | $ 177,500 |
Related Party Transactions - Ot
Related Party Transactions - Other Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Professional fees and reimbursements | Affiliated entity | ||
Related Party Transaction [Line Items] | ||
Expenses from related party transactions | $ 2,100 | $ 700 |