Cover
Cover - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Mar. 27, 2024 | Jun. 30, 2023 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2023 | ||
Current Fiscal Year End Date | --12-31 | ||
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 Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
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 | ||
Document Financial Statement Error Correction [Flag] | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 39,995,027 | ||
Documents Incorporated by Reference | Portions of the Registrant’s Proxy Statement relating to the 2024 annual meeting of stockholders (the “2024 Proxy Statement”), which will be filed within 120 days of December 31, 2023, are incorporated by reference into Part III of this Form 10-K. | ||
Entity Central Index Key | 0001519449 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2023 | ||
Document Fiscal Period Focus | FY | ||
Entity Public Float | $ 600 |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2023 | |
Audit Information [Abstract] | |
Auditor Name | Ernst & Young LLP |
Auditor Location | Houston, Texas |
Auditor Firm ID | 42 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Investments: | ||
Fixed maturity securities, available-for-sale, at fair value (amortized cost of $1,047,713 and $662,616, respectively) | $ 1,017,651 | $ 607,572 |
Fixed maturity securities, held-to-maturity, at amortized cost (net of allowance for credit losses of $329 as of December 31, 2023) | 42,986 | 52,467 |
Equity securities, at fair value | 118,249 | 120,169 |
Mortgage loans (at fair value as of December 31, 2023; at amortized cost as of December 31, 2022) | 50,070 | 51,859 |
Other long-term investments | 114,505 | 129,142 |
Short-term investments, at fair value | 270,226 | 121,158 |
Total investments | 1,613,687 | 1,082,367 |
Cash and cash equivalents | 65,891 | 45,438 |
Restricted cash | 34,445 | 79,573 |
Premiums receivable, net | 179,235 | 139,215 |
Reinsurance recoverables, net | 596,334 | 581,359 |
Ceded unearned premium | 186,121 | 157,645 |
Deferred policy acquisition costs | 91,955 | 68,938 |
Deferred income taxes, net | 21,991 | 36,188 |
Goodwill and intangible assets, net | 88,435 | 89,870 |
Other assets | 75,341 | 82,846 |
Total assets | 2,953,435 | 2,363,439 |
Liabilities: | ||
Reserves for losses and loss adjustment expenses | 1,314,501 | 1,141,757 |
Unearned premiums | 552,532 | 442,509 |
Deferred ceding commission | 37,057 | 29,849 |
Reinsurance and premium payables | 150,156 | 113,696 |
Funds held for others | 58,588 | 36,858 |
Accounts payable and accrued liabilities | 50,880 | 48,499 |
Notes payable | 50,000 | 50,000 |
Subordinated debt, net of debt issuance costs | 78,690 | 78,609 |
Total liabilities | 2,292,404 | 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, 39,863,756 and 16,832,955 shares issued, respectively | 399 | 168 |
Treasury stock, $0.01 par value, 0 and 233,289 shares, respectively | 0 | (2) |
Additional paid-in capital | 710,855 | 577,289 |
Stock notes receivable | (5,562) | (6,911) |
Accumulated other comprehensive loss | (22,953) | (43,485) |
Accumulated deficit | (21,708) | (105,417) |
Total stockholders’ equity | 661,031 | 421,662 |
Total liabilities and stockholders’ equity | $ 2,953,435 | $ 2,363,439 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Amortized cost | $ 1,047,713 | $ 662,616 |
Allowance for credit losses | $ 329 | |
Preferred stock, par value (in dollars 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 dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 168,000,000 |
Common stock, shares issued (in shares) | 39,863,756 | 16,832,955 |
Treasury stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Treasury stock (in shares) | 0 | 233,289 |
Consolidated Statements of Oper
Consolidated Statements of Operations and Comprehensive Income (Loss) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenues: | ||
Net earned premiums | $ 829,143 | $ 615,994 |
Commission and fee income | 6,064 | 5,199 |
Net investment income | 40,322 | 36,931 |
Net investment gains (losses) | 11,072 | (15,705) |
Other (loss) income | (632) | 1 |
Total revenues | 885,969 | 642,420 |
Expenses: | ||
Losses and loss adjustment expenses | 515,237 | 402,512 |
Underwriting, acquisition and insurance expenses | 243,444 | 182,171 |
Interest expense | 10,024 | 6,407 |
Amortization expense | 1,798 | 1,547 |
Other expenses | 5,364 | 0 |
Total expenses | 775,867 | 592,637 |
Income before income taxes | 110,102 | 49,783 |
Income tax expense | 24,118 | 10,387 |
Net income | 85,984 | 39,396 |
Net income attributable to participating securities | 1,677 | 18,879 |
Net income attributable to common shareholders | 84,307 | 20,517 |
Comprehensive income: | ||
Net income | 85,984 | 39,396 |
Unrealized gains and losses on investments: | ||
Net change in unrealized gains (losses) on investments, net of tax | 25,516 | (48,545) |
Reclassification adjustment for (losses) gains on securities no longer held, net of tax | (4,984) | 420 |
Total other comprehensive income (loss) | 20,532 | (48,125) |
Comprehensive income (loss) | $ 106,516 | $ (8,729) |
Per share data: | ||
Basic earnings per share (in dollars per share) | $ 2.34 | $ 1.24 |
Diluted earnings per share (in dollars per share) | $ 2.24 | $ 1.21 |
Weighted-average common shares outstanding | ||
Basic weighted-average common shares (in shares) | 36,031,907 | 16,568,393 |
Diluted weighted-average common shares (in shares) | 38,317,534 | 32,653,194 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) $ in Thousands | Total | 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 | $ 20 | $ 168 | $ (2) | $ 575,159 | $ (9,092) | $ 4,640 | $ (144,813) | $ 0 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock | 0 | 2,130 | 2,181 | ||||||
Preferred stock conversion to common shares | 0 | 0 | 0 | 0 | |||||
Proceeds from equity offerings, net | 0 | 0 | |||||||
Other comprehensive income (loss), net of tax | $ (48,125) | (48,125) | |||||||
Net income | 39,396 | 39,396 | |||||||
Stockholders' equity ending balance at Dec. 31, 2022 | 421,662 | 20 | 168 | (2) | 577,289 | (6,911) | (43,485) | (105,417) | $ (2,275) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Issuance of common stock | 22 | 9,213 | 1,349 | ||||||
Preferred stock conversion to common shares | (20) | 161 | 2 | (143) | |||||
Proceeds from equity offerings, net | 48 | 124,496 | |||||||
Other comprehensive income (loss), net of tax | 20,532 | 20,532 | |||||||
Net income | 85,984 | 85,984 | |||||||
Stockholders' equity ending balance at Dec. 31, 2023 | $ 661,031 | $ 0 | $ 399 | $ 0 | $ 710,855 | $ (5,562) | $ (22,953) | $ (21,708) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||||
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-13 [Member] |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 85,984 | $ 39,396 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Net investment (gains) losses | (11,072) | 15,705 |
Depreciation and amortization expense | 3,891 | 4,097 |
Stock-based compensation expense | 8,525 | 2,287 |
Undistributed loss (earnings) from long-term investments | 6,730 | (16,032) |
Deferred income tax, net | 9,383 | 10,267 |
Changes in operating assets and liabilities: | ||
Premiums receivable, net | (40,020) | (27,057) |
Reinsurance recoverables, net | (17,270) | (45,032) |
Ceded unearned premium | (28,476) | (19,672) |
Deferred policy acquisition costs | (23,017) | (9,482) |
Federal income taxes | (1,892) | 0 |
Losses and loss adjustment expenses | 172,744 | 162,208 |
Unearned premiums | 110,023 | 79,221 |
Deferred ceding commission | 7,208 | (651) |
Reinsurance and premium payables | 36,460 | (6,223) |
Funds held for others | 21,730 | 7,271 |
Accounts payable and accrued liabilities | 2,285 | 7,583 |
Other, net | (5,029) | 5,052 |
Net cash provided by operating activities | 338,187 | 208,938 |
Cash flows from investing activities: | ||
Purchase of fixed maturity securities, available-for-sale | (459,672) | (268,781) |
Purchase of illiquid investments | (1,675) | (4,873) |
Purchase of equity securities | (26,009) | (53,548) |
Purchase of intangible assets | (50) | 0 |
Investment in direct and indirect loans | 2,984 | (9,767) |
Purchase of property and equipment | (3,108) | (2,325) |
Sales and maturities of investment securities | 127,228 | 95,641 |
Sales of and distributions from unconsolidated subsidiaries | 3,572 | 3,421 |
Change in short-term investments | (149,068) | 43,120 |
Payable for securities sold | 76 | 529 |
Cash provided by deposit accounting | 11,913 | 3,202 |
Net cash used in investing activities | (493,809) | (193,381) |
Cash flows from financing activities: | ||
Employee share purchases | 1,350 | 2,180 |
Draw on revolving line of credit | 50,000 | 0 |
Repayment of term loan | (50,000) | 0 |
Proceeds from equity offerings | 128,887 | 0 |
Proceeds from employee stock purchase plan | 710 | 0 |
Net cash provided by financing activities | 130,947 | 2,180 |
Net (decrease) increase in cash and cash equivalents and restricted cash | (24,675) | 17,737 |
Cash and cash equivalents and restricted cash at beginning of year | 125,011 | 107,274 |
Cash and cash equivalents and restricted cash at end of year | 100,336 | 125,011 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 10,667 | 5,761 |
Cash paid for federal income taxes | $ 15,800 | $ 0 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies A. Description of Business Skyward Specialty Insurance Group, Inc. (the “Company”), an insurance holding company, is a Delaware corporation that was organized in 2006. It is a specialty insurance company operating in one segment delivering commercial property and casualty products insurance coverages through its underwriting divisions. The Company has four wholly owned insurance company subsidiaries based in the United States: • Houston Specialty Insurance Company (“HSIC”) underwrites insurance on a non-admitted basis. • Imperium Insurance Company (“IIC”), a subsidiary of HSIC, underwrites insurance on an admitted basis • Great Midwest Insurance Company (“GMIC”), a subsidiary of IIC, underwrites insurance on an admitted basis and is a certified surety bond company listed with the U.S. Department of the Treasury. • Oklahoma Specialty Insurance Company (“OSIC”), a subsidiary of GMIC, underwrites insurance on a non-admitted basis. The Company has a wholly owned captive reinsurance company subsidiary, Skyward Re, that is domiciled in the Cayman Islands and assumes net reserves for certain divisions, related to a retroactive reinsurance contract, from the Company’s insurance companies and retrocedes the net reserves to a third-party reinsurer. The Company has two non-risk bearing wholly owned subsidiaries, (i) Skyward Underwriters Agency, Inc. (“SUA”) is a managing general insurance agent and reinsurance broker for property and casualty risks in specialty niche markets, and (ii) Skyward Service Company provides various administrative services to the Company’s subsidiaries. The Company’s consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”), which differ in some respects from those followed in reports to insurance regulatory authorities. The consolidated financial statements includes the accounts of the holding company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes. The Company’s actual results could differ from those estimates. C. Cash and Cash Equivalents Cash and cash equivalents include cash on hand and fixed maturity securities with original maturities of three months or less. The carrying value of the Company’s cash and cash equivalents approximates fair value. D. Restricted Cash Cash with a legal restriction on withdrawal or use by the consolidated group is recorded as restricted cash. The carrying value of the Company’s restricted cash approximates fair value. SUA collects premiums from clients, and after deducting commissions and any applicable fees, remits these premiums to the Company’s insurance companies, or to third-party insurance companies. SUA holds unremitted insurance premiums in a fiduciary capacity to third-party insurance companies, as restricted cash. The Company is required by state regulations to maintain assets on deposit with certain states and hold cash as collateral for certain reinsurance balances. Cash held in a depository account for others, or restricted by a state, is recorded as restricted cash. E. Investments Available for Sale Investments in fixed maturities that are classified as available-for-sale 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 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 income 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 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 loss. Held to maturity Investments in fixed maturity securities that are 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 multi-year cumulative loss rates for asset backed securities. The 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 income on the consolidated statements of operations. Other-than-Temporary Impairments Prior to the adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), on January 1, 2023, the Company evaluated declines in the market value of invested assets below amortized cost, for other-than-temporary impairment losses, on a quarterly basis. Impairment losses for declines in the value of its fixed maturity securities below amortized cost attributable to issuer-specific events were based on all relevant facts and circumstances for each investment and were recognized when appropriate. For all investments with unrealized losses due to market conditions or industry-related events where the Company did not had intent to sell the security and it had the ability to hold the investment for either a period of time sufficient to allow a market recovery or to maturity, declines in value below cost were not assumed to be other-than-temporary. When the Company considered the impairment of the value of an investment to be other-than-temporary, it reported the decrease in value in net income within the consolidated statements of operations and a corresponding reduction in carrying value on the consolidated balance sheet. Equity securities with a readily determinable fair value Equity securities consists of common stock or preferred stock. Mutual funds, including those that invest mostly in debt securities, are classified as equity securities. Investments in equity securities with a readily determinable fair value are carried on the balance sheet at fair value using quoted market prices. Changes in the carrying value of equity securities are included in net investment gains (losses) within the consolidated statements of operations. Mortgage loan s Investments in mortgage loans are classified as held for investment and carried on the balance sheet at cost adjusted for unamortized premiums, discounts and loan fees. When an amount is determined to be uncollectible, the Company writes off the uncollectible amount in the period it was determined to be uncollectible. Interest on the loans is recognized as interest receivable which the Company includes in other assets on the consolidated balance sheet. The Company elected the fair value option in accounting for mortgage loans effective January 1, 2023 as targeted transition relief from the adoption of ASU 2016-13. 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. Other long-term investments Other long-term investments include investments in equity and equity securities of non-public entities and indirect investments in loans and loan collateral. The Company has equity investments in certain limited partnerships and corporations where it has significant influence but not control. The analysis of entities that are variable interest entities indicated the Company is not the primary beneficiary, and would not have to consolidate these entities. Equity method is used to account for these investments in unconsolidated subsidiaries. Under the equity method, initial investment is recorded at cost and is subsequently adjusted based on its proportionate share of distributions and net income or loss of the equity method investee. The difference between the cost of an investment and its proportionate share of the underlying equity in net assets recorded on the investee’s books is a component of investment income. The Company amortizes the difference as an adjustment to its pro-rata share of equity method income over the useful life which is based on the underlying asset. The Company does not have significant influence in its investments in equity securities of non-public entities. When these securities do not have a readily determinable fair value, the Company carries these investments at cost, minus impairment, if any, and changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Investments in indirect collateralized loans and loan collateral are held through and accounted for as an ownership interest in an unconsolidated subsidiary. The Company’s ownership interests in unconsolidated subsidiaries consists of investments in entities such as partnerships, joint ventures, and special purpose investment vehicles. The Company has significant influence, but not control of these unconsolidated subsidiaries and uses the equity method to account for these investments. Short-Term Investments Short-term investments consist primarily of money market funds and are carried at cost which approximates fair value. Net Investment Income and Net Realized Gains and Losses Net investment income consists of interest, dividends and equity in earnings (losses) of unconsolidated subsidiaries net of investment expenses such as investment management expenses. Interest income is recognized on the accrual basis, and dividends as earned at the ex-dividend date. Interest income on mortgage-backed and other asset-backed securities is recognized using the effective-yield method based on estimated principal repayments. Included in interest income is the amortization of premium and accretion of discounts on debt securities. Net realized gains and losses on investments are recognized in net income based upon the specific identification method. F. Reinsurance Reinsurance Accounting In the normal course of business, the Company purchases prospective reinsurance for certain lines of business on a proportional, excess of loss and facultative basis. Proportional reinsurance requires the Company to share the losses and expenses with the reinsurer in exchange for a share of the premiums. Excess of loss reinsurance shares losses, either a proportion of or in its entirety, above a certain dollar threshold, in exchange for a negotiated cost. Facultative reinsurance covers specific risks and/or policies on either a proportional or excess of loss basis. Ceded unearned premium and reinsurance balances recoverable—on paid and unpaid losses and settlement expenses—are reported separately as assets, instead of netting them with the related liabilities, since reinsurance does not relieve the Company of its legal liability to its policyholders. Reinsurance on unpaid losses and settlement expenses represent estimates of the portion of the liabilities recoverable from reinsurers. On the Consolidated Statements of Operations, net earned premiums, losses and loss adjustment expenses, net and underwriting, acquisition and insurance expenses are presented net of reinsurance ceded. The Company purchases retroactive reinsurance on certain lines of business in the form of loss portfolio transfers (“LPT”) and adverse development covers. These contracts provide indemnification of losses related to past loss events where the reinsurer shares losses, either a proportion of or in its entirety, depending on certain dollar thresholds. Income generated from retroactive reinsurance contracts is deferred and amortized into net income over the settlement period and losses are charged to net income immediately. Subsequent changes in the measurement of the retroactive reinsurance contract are accounted for under a full retrospective method. Deposit Accounting Certain ceded reinsurance contracts, which management determines do not transfer significant insurance risk, are accounted for using the deposit method of accounting. The evaluation of the transfer of significant insurance risk involves an assessment of both timing risk and underwriting risk. Management may determine that a reinsurance contract does not transfer significant insurance risk if either underwriting risk or timing risk or both are not deemed to have been transferred. For those contracts that transfer only significant timing risk and do not transfer sufficient underwriting risk, a deposit asset is recorded equal to the initial cash outflow under the contract, which will then be offset by cash inflows received from the reinsurers. To the extent cash outflows are expected to differ from expected cash inflows, an accretion rate is established at inception of the contract based on actuarial estimates whereby the deposit accounting asset is increased/decreased to the estimated amount receivable over the contract term. The accretion of the deposit is based on the expected rate of return implied from the estimated cash inflows and outflows under the contract. Periodically, the Company reassesses the estimated ultimate receivable and the related expected rate of return on the deposit asset. The accretion of the deposit asset, including any changes in accretion resulting from changes in estimated cash flows, are reflected as part of investment income in the Company’s results of operations. Several reinsurance contracts require deposit accounting treatment due to not transferring sufficient underwriting risk. There were no reinsurance contracts that require deposit accounting treatment due to not transferring sufficient timing risk. 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. The historical loss rate is adjusted for current conditions, 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. Reinsurance does not relieve the Company of its legal liability to its policyholders. The Company continuously monitors the financial condition of its reinsurers. As part of its monitoring efforts, the Company reviews the reinsurers’ annual financial statements. The Company also reviews insurance industry developments that may impact the financial condition of its reinsurers. The Company analyzes the credit risk associated with its reinsurance recoverables by monitoring the financial strength rating of its reinsurers from A.M. Best. It also assesses the adequacy of collateral obtained, where applicable. Should its reinsurers fail to fulfill their obligations, the Company has access to collateral from various reinsurers. As of December 31, 2023 and 2022, reinsurance collateral from reinsurers was $257.5 million and $253.9 million, respectively. Reinsurance recoverables present potential exposures to individual reinsurers. Everest Reinsurance Co represented 20.4% and 28.2% of the Company’s reinsurance recoverable balances at December 31, 2023 and 2022, respectively, and was the only reinsurer that represented 10% or more of the Company’s reinsurance recoverable balances. Its financial strength rating from A.M. Best was A+ at December 31, 2023 and 2022. G. Concentration of Credit Risk Other than reinsurance recoverables, financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents, restricted cash, investments and premiums receivable. Cash equivalents and short-term investments include U.S. government securities and money market funds. Investments are diversified throughout many industries and geographic regions. The Company limits the amount of credit exposure with any one financial institution or issuer and believes no significant concentration of credit risk exists with respect to cash and investments. As of December 31, 2023 and 2022, outstanding premiums receivable are generally diversified due to the large number of entities comprising the Company’s customer base and their dispersion across many different lines of business and geographic regions. Failure by distribution sources to remit premiums could result in premium write-offs and a corresponding loss of income. H. Deferred Policy Acquisition Costs Policy acquisition costs consist of commissions and premium taxes that vary with and are directly related to the successful production of new or renewal business. The Company defers policy acquisition costs and related ceding commissions and charge or credit them to earnings in proportion with the premium earned over the life of the policy. A premium deficiency is recognized if the sum of expected losses, loss adjustment expenses, and unamortized acquisition costs exceed its related unearned premiums. The Company first recognizes a premium deficiency by charging any unamortized acquisition costs to expense to the extent required to eliminate the deficiency. If its premium deficiency is greater than unamortized acquisition costs, it accrues a liability for the excess deficiency. Anticipated investment income is considered in the determination of premium deficiencies. Management performed an analysis and determined no premium deficiency existed as of December 31, 2023 and 2022. I. Goodwill and Intangible Assets Goodwill and intangible assets are recorded as a result of a business combination. Goodwill represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed. The Company reviews its purchase price allocation up to one year subsequent to an acquisition and may make adjustments within the one-year period. The Company amortizes identifiable intangible assets with a finite useful life over the period that the intangible asset is expected to contribute directly or indirectly to its future cash flows; however, it does not amortize indefinite lived intangible assets. The Company reviews goodwill and identifiable intangible assets for recoverability annually in the fourth quarter or on an interim basis should events or changes in circumstances indicate that a carrying amount may not be recoverable. Based upon this review, the Company did not have any goodwill impairment for the years ended December 31, 2023 and 2022. J. Property and Equipment Property and equipment, which is included in other assets on the consolidated balance sheets, is recorded at cost less accumulated depreciation. Depreciation expense is recognized on a straight-line basis for financial statement purposes over periods ranging from three K. Leases Right-of-use (ROU) assets are included in other assets and lease liabilities are included in accounts payable and accrued liabilities on the consolidated balance sheets. For operating leases, the Company determines if a contract contains a lease at inception and recognizes the operating lease ROU assets and lease liabilities based on the present value of the future minimum lease payments at the commencement date. As the Company does not have the interest rate implicit in its leases, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Lease agreements may include options to extend or terminate. The options are exercised at the Company’s discretion and are included in operating lease liabilities if it is reasonably certain the option will be exercised. Lease agreements have lease and non-lease components, which are accounted for as a single lease component. Operating lease cost for future minimum lease payments is recognized on a straight-line basis over the lease term. Sublease income is recognized on a straight-line basis over the sublease term. L. Reserves for Losses and Loss Adjustment Expenses Reserves for losses and loss adjustment expenses (“LAE”) represent the Company’s best estimate of the ultimate net cost of all reported and unreported losses that are unpaid as of the balance sheet dates. The estimates are based on certain actuarial and other assumptions related to the ultimate cost to settle such claims. Such assumptions are subject to occasional changes due to evolving economic, social and political conditions. Because of the nature of business the Company has historically written, management believes that it has limited exposure to environmental and other toxic tort type claim liabilities. All estimates are periodically reviewed and, as experience develops and new information becomes known, the reserves are adjusted as necessary. Such adjustments are reflected in the results of operations in the period in which they are determined. Due to the inherent uncertainty in estimating reserves for losses and settlement expenses, there can be no assurance that the ultimate liability will not exceed recorded amounts. If actual liabilities do exceed recorded amounts, there will be an adverse effect. Furthermore, we may determine that recorded reserves are more than adequate to cover expected losses, which would lead to a reduction in our reserves. M. Premiums The Company earns and recognizes property and casualty and surety premiums on a pro-rata basis over the terms of the policies. The Company earns accident and health premiums as billed, based on census data. Gross premiums written are reduced by ceded premiums from proportional, facultative and excess of loss reinsurance costs for prospective reinsurance. Its premiums receivable includes deferred premiums, which represent installment payments the Company is due from insureds under the payment terms of their policies. Premiums receivable 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. Unearned premiums represent the portion of gross premiums written which is applicable to the unexpired terms of insurance policies or reinsurance contracts in force. Ceded unearned premiums represent the portion of ceded premiums written which is applicable to the unexpired terms of insurance policies or reinsurance contracts in force. These unearned premiums are calculated on a pro-rata basis over the terms of the policies for direct and ceded amounts. N. Commission and Fee Income SUA commission revenue SUA commission revenue is generated from the placement of insurance policies on reinsurance programs through a reinsurance broker which represents the Company’s single performance obligation. Its transaction price is fixed at contract inception and based on a percentage of premiums placed. The Company recognizes 100% of the transaction price as the associated performance obligation is satisfied at the point in time a policy is placed as it has no constraints on revenue. SUA fee income SUA fee income is generated from the placement of insurance policies with a third-party insurance company. The Company’s single performance obligation consists of the placement of the policy. Its transaction price is variable at contract inception and based on a percentage of premium based on risk factors that vary every month such as employee census data and worker roles. The Company estimates its transaction price over the life of the policy using the expected value method and recognizes revenue at the point in time the policy is placed. When there are changes in the estimate of variable consideration, it recognizes those changes in the month they occur. O. Income Taxes Income tax expense is accrued for the tax effects of transactions reported on the consolidated financial statements, and this provision for income taxes consists of taxes currently due plus deferred taxes resulting from temporary differences between amounts reported for financial statement and income tax purposes. A valuation allowance is established for any deferred tax asset not expected to be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date. A liability for uncertain tax positions is recorded where it is more likely-than-not that the tax position will not be sustained upon examination by the appropriate tax authority. Changes in the liability for uncertain tax positions are reflected in income tax expense in the period when a new uncertain tax position arises, judgment changes about the likelihood of an uncertainty, the tax issue is settled, or the statute of limitation expires. Any potential net interest income or expense and penalties related to uncertain tax positions are recorded on the Consolidated Statements of Operations. The Company files a consolidated federal income tax return in the United States and certain other state tax returns. Its admitted insurance subsidiaries pay premium taxes on gross written premiums in lieu of most state income or franchise taxes. Premium tax expense is recognized within underwriting, acquisition and insurance expense on the Consolidated Statements of Operations. P. Fair Value of Financial Instruments Fair value is estimated for each class of financial instrument based on the framework established in the fair value accounting guidance. This guidance requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value hierarchy disclosures are based on the quality of inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). As a part of management’s process to determine fair value, the Company utilizes widely recognized, third-party pricing sources to determine the Company’s fair values of financial instruments. The Company has obtained an understanding of the third-party pricing sources’ valuation methodologies and inputs. See Note 6 for further details regarding fair value disclosures. Q. Stock-Based Compensation We expense the estimated fair value of employee stock options and similar awards. We measure compensation cost for awards of equity instruments to employees based on the grant-date fair value of those awards and recognize compensation expense over the service period that the awards are expected to vest. The tax effects related to share-based payments are made through net earnings. See note 18 for further discussion and related disclosures regarding stock-based compensation. Employee Stock Purchase Plan The Company’s employee stock purchase plan (“ESPP”), offers all employees the option to purchase common stock at a discount. The Company recognizes compensation cost on a straight-line basis over the offering period. R. Earnings Per Share Basic earnings per share is calculated using the two-class method. Undistributed earnings are allocated to participating securities based on the extent to which each class may share in earnings as if all the earnings for the period have been distributed. Basic earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding for the period. Common shares, when contingencies, such as vesting requirements, exist and have not been satisfied, are excluded from basic earnings per share. 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. 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. These instruments are excluded from basic and diluted earnings per share when the specified conditions are not met presuming the end of the period is the end of the contingency period. The impact of the contingently issuable instruments on diluted earnings per share was calculated using the treasury stock method and included in the reconciliation of the denominator of the basic and diluted earnings per share computations for the years ended December 31, 2023 and 2022. Instruments that are convertible into common shares are included in diluted weighted-average common shares outstanding on an if-converted basis based on the legal conversion rate for the respective period, if dilutive. Share-based awards to employees with only service conditions are included as potential common shares, weighted for the portion of the period they are unvested, if dilutive. Share-based awards to employees with performance and service or market conditions are included as potential common shares presuming the end of the period is the end of the contingency period, if dilutive. When inclusion of common share adjustments increases the earnings per share or reduces the loss per share, the effect on earnings is anti-dilutive, and the diluted net earnings or net loss per share is computed excluding these common share equivalents. The Company currently qualifies as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. Accordingly, the Company is provided the option to adopt new or revised accounting guidance either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. The Company may elect to adopt new or revised accounting guidance within the same time period as private companies, unless, as indicated below, management determines it is preferable to take advantage of early adoption provisions offered within the applicable guidance. Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326). ASU 2016-13 requires organizations to estimate credit losses on certain types of financial instruments, including receivables and available-for-sale debt securities, by introducing an approach based on expected losses. The expected loss approach will require 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 th |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The following tables set forth the carrying amount and changes in the balance of goodwill by reporting unit at December 31, 2023 and 2022: ($ in thousands) Accident Surety Industry Solutions Other Total Goodwill Gross balance at December 31, 2022 $ 91,577 $ 6,781 $ 10,204 $ 3,879 $ 112,441 Accumulated impairment at December 31, 2022 (44,821) — — (1,886) (46,707) Net balance at December 31, 2023 $ 46,756 $ 6,781 $ 10,204 $ 1,993 $ 65,734 ($ in thousands) Accident Surety Industry Solutions Other Total Goodwill Gross balance at December 31, 2021 $ 91,577 $ 6,781 $ 10,204 $ 3,879 $ 112,441 Accumulated impairment at December 31, 2021 (44,821) — — (1,886) (46,707) Net balance at December 31, 2022 $ 46,756 $ 6,781 $ 10,204 $ 1,993 $ 65,734 The following tables set forth the carrying amount and changes in the balance of other intangible assets at December 31, 2023 and 2022: ($ in thousands) Agent Non-competes Trademarks Licenses Total Other Intangible Assets Gross balance at December 31, 2022 $ 24,558 $ 1,117 $ 999 $ 14,019 $ 40,693 Accumulated amortization at December 31, 2022 (15,664) (893) — — (16,557) Additions 50 — — — 50 Amortization (1,261) (224) — (1,485) Net balance at December 31, 2023 $ 7,683 $ — $ 999 $ 14,019 $ 22,701 ($ in thousands) Agent Non-competes Trademarks Licenses Total Other Intangible Assets Gross balance at December 31, 2021 $ 24,558 $ 1,117 $ 999 $ 14,019 $ 40,693 Accumulated amortization at December 31, 2021 (14,421) (670) — — (15,091) Amortization (1,243) (223) — — (1,466) Net balance at December 31, 2022 $ 8,894 $ 224 $ 999 $ 14,019 $ 24,136 The Company’s indefinite lived intangible assets relate to insurance licenses and trademarks. Its finite lived intangible assets, which relate to policy renewals, agency relationships, within agent relationships, and non-compete/exclusivity agreements, within non-competes, have a weighted average useful life of approximately 15 years as of December 31, 2023. The Company recognized $1.5 million in amortization expense for the years ended December 31, 2023 and 2022. The following table sets forth the estimated future net amortization expense of intangible assets: ($ in thousands) Years Ending December 31, Amount 2024 $ 1,099 2025 998 2026 553 2027 553 2028 553 |
Investments
Investments | 12 Months Ended |
Dec. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments The following tables set forth the amortized cost and the fair value of investments at December 31, 2023 and 2022: ($ in thousands) Gross Gross Gross Allowance for Credit Losses Fair Value December 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 44,685 $ 202 $ (721) $ — $ 44,166 Corporate securities and miscellaneous 392,773 6,408 (15,761) — 383,420 Municipal securities 98,266 655 (6,143) — 92,778 Residential mortgage-backed securities 292,568 3,556 (14,498) — 281,626 Commercial mortgage-backed securities 31,411 449 (1,926) — 29,934 Other asset-backed securities 188,010 1,221 (3,504) — 185,727 Total fixed maturity securities, available-for-sale $ 1,047,713 $ 12,491 $ (42,553) $ — $ 1,017,651 Fixed maturity securities, held-to-maturity: Other asset-backed securities $ 43,315 $ — $ (1,969) $ (329) $ 41,017 Total fixed maturity securities, held-to-maturity $ 43,315 $ — $ (1,969) $ (329) $ 41,017 ($ 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 Other 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: Other asset-backed securities $ 52,467 $ — $ (5,696) $ 46,771 Total fixed maturity securities, held-to-maturity $ 52,467 $ — $ (5,696) $ 46,771 The amortized cost and estimated fair value of fixed maturity securities, available for sale, at December 31, 2023 by contractual maturity are shown below. 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. ($ in thousands) Amortized Fair Value Due in less than one year $ 30,918 $ 30,518 Due after one year through five years 289,151 280,212 Due after five years through ten years 162,380 159,863 Due after ten years 53,275 49,771 Mortgage-backed securities 323,979 311,560 Other asset-backed securities 188,010 185,727 Total $ 1,047,713 $ 1,017,651 The Company’s fixed maturity securities, held to maturity, at December 31, 2023 consist entirely of asset backed securities that are not due at a single maturity date. The following tables summarize gross unrealized losses and the corresponding fair values of investments, aggregated by length of time that individual securities have been in a continuous unrealized loss position: Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Fair Value Gross Fair Value Gross December 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 7,342 $ (25) $ 25,604 $ (696) $ 32,946 $ (721) Corporate securities and miscellaneous 26,742 (570) 174,947 (15,191) 201,689 (15,761) Municipal securities 16,815 (290) 47,269 (5,853) 64,084 (6,143) Residential mortgage-backed securities 37,634 (602) 103,495 (13,896) 141,129 (14,498) Commercial mortgage-backed securities 4,942 (74) 15,290 (1,852) 20,232 (1,926) Other asset-backed securities 27,887 (106) 75,253 (3,398) 103,140 (3,504) Total fixed maturity securities, available-for-sale 121,362 (1,667) 441,858 (40,886) 563,220 (42,553) Fixed maturity securities, held-to-maturity: Other asset-backed securities — — 41,017 (1,969) 41,017 (1,969) Total fixed maturity securities, held-to-maturity — — 41,017 (1,969) 41,017 (1,969) Total $ 121,362 $ (1,667) $ 482,875 $ (42,855) $ 604,237 $ (44,522) Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Fair Value Gross Fair Value Gross 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) Other 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: Other 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 December 31, 2023, the Company has 584 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Gross realized gains Fixed maturity securities, available-for-sale $ 1,042 $ 313 Equity securities 6,035 3,865 Other 2 36 Total 7,079 4,214 Gross realized losses Fixed maturity securities, available-for-sale (1,879) (958) Equity securities (5,256) (3,827) Other (2) (76) Total (7,137) (4,861) Net unrealized gains (losses) on investments Equity securities 11,516 (15,058) Mortgage loans (386) — Net investment gains (losses) $ 11,072 $ (15,705) The following table sets forth the proceeds from sales of debt and equity securities for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for-sale $ 26,626 $ 13,964 Equity securities 40,201 37,177 The following table sets forth the components of net investment income for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for-sale $ 34,703 $ 18,481 Fixed maturity securities, held-to-maturity 4,163 5,375 Equity securities 3,418 3,579 Equity method investments (9,434) 6,015 Mortgage loans 5,474 4,767 Indirect loans (4,155) 4,846 Short-term investments 11,392 1,498 Other 318 (77) Investment income 45,879 44,484 Investment expenses (5,557) (7,553) Net investment income $ 40,322 $ 36,931 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities $ 25,952 $ (60,918) Deferred income taxes (5,420) 12,793 Total $ 20,532 $ (48,125) Various state regulations require the Company to maintain cash, investment securities or letters of credit on deposit with the states in a depository account. At December 31, 2023 and 2022, cash and investment securities on deposit had fair values of approximately $62.3 million and $60.2 million, respectively. |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | 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 other 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 December 31, 2023: December 31, 2023 High 9.50 % Low 3.25 % Weighted average 7.05 % The following tables set forth the Company’s investments within the fair value hierarchy at December 31, 2023 and December 31, 2022: December 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 44,166 $ — $ — $ 44,166 Corporate securities and miscellaneous — 383,420 — 383,420 Municipal securities — 92,778 — 92,778 Residential mortgage-backed securities — 281,626 — 281,626 Commercial mortgage-backed securities — 29,934 — 29,934 Other asset-backed securities — 185,727 — 185,727 Total fixed maturity securities, available-for-sale 44,166 973,485 — 1,017,651 Fixed maturity securities, held-to-maturity: Other asset-backed securities — — 41,017 41,017 Total fixed maturity securities, held-to-maturity — — 41,017 41,017 Common stocks: Consumer discretionary 2,313 — — 2,313 Consumer staples 14,015 — — 14,015 Energy 3,187 — — 3,187 Finance 24,267 — — 24,267 Industrial 12,170 — — 12,170 Information technology 5,192 — — 5,192 Materials 3,782 — — 3,782 Other 2,499 — — 2,499 Total common stocks 67,425 — — 67,425 Preferred stocks: Consumer staples — 433 — 433 Finance — 5,061 — 5,061 Industrial — 1,052 — 1,052 Other — 812 — 812 Total preferred stocks — 7,358 — 7,358 Mutual funds: Fixed income 5,405 — — 5,405 Equity 37,546 — — 37,546 Commodity 515 — — 515 Total mutual funds 43,466 — — 43,466 Total equity securities 110,891 7,358 — 118,249 Mortgage loans — — 50,070 50,070 Short-term investments 270,226 — — 270,226 Total investments $ 425,283 $ 980,843 $ 91,087 $ 1,497,213 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 Other 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: Other 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 year ended December 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total losses for the period recognized in net investment gains (losses) (385) Issuances 27,642 Settlements (30,029) Balance at December 31, 2023 $ 50,070 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 $ (426) 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 December 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 observable (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 December 31, 2023 and December 31, 2022: December 31, 2023 December 31, 2022 ($ in thousands) Carrying Fair Carrying Fair Notes payable Term loan $ — $ — $ 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 $ 59,186 $ 59,794 $ 59,137 $ 59,794 Unsecured subordinated notes 19,504 21,378 19,472 18,934 Subordinated debt, net of debt issuance costs $ 78,690 $ 81,172 $ 78,609 $ 78,728 |
Mortgage Loans
Mortgage Loans | 12 Months Ended |
Dec. 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 is the Company’s largest stockholder. As of December 31, 2023 and 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 spread above a prime rate, mature in approximately 1 to 3 years from loan origination and the principal amounts of the loans range between 61% to 90% of the property’s appraised value at the time the loans were made. Mortgage loan participations are carried at fair value as of December 31, 2023 and cost adjusted for unamortized premiums, discounts, and loan fees as of December 31, 2022. The carrying value of the Company’s mortgage loans as of December 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Retail $ 16,072 $ 16,516 Commercial 14,469 15,309 Industrial 6,785 6,329 Multi-family — 5,593 Office — 3,197 Hospitality 12,744 4,915 $ 50,070 $ 51,859 The Company’s gross investment income for the years ended December 31, 2023 and 2022 is as follows: Years Ended December 31, ($ in thousands) 2023 2022 Retail $ 1,853 $ 1,255 Commercial 2,340 1,242 Industrial — 565 Multi-family 44 909 Office 203 385 Hospitality 1,034 411 $ 5,474 $ 4,767 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 for the years ended December 31, 2023 and 2022. As of December 31, 2023 and 2022, approximately $7.1 million and $6.4 million of mortgage loans, respectively, were in the process of foreclosure. As of December 31, 2023, $6.8 million of mortgage loans were not producing income for the previous 12 months. |
Other Long-Term investments
Other Long-Term investments | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Other Long-Term Investments | Other Long-Term Investments Unconsolidated Subsidiaries - 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 Company owns investment products issued by Arena Special Opportunities Partners (Feeder) I, LP (“Arena SOP”), managed by Arena, which is affiliated with Westaim. The investment products include senior and junior notes issued by the Arena SOP to raise capital from limited partners to fund purchases of investments. The return on the investments is used to pay interest on the senior and junior notes based on target returns of each class. The senior and junior notes are debt securities classified as held to maturity and presented on the balance sheet within fixed maturity securities, held to maturity. Income in excess of return targets on the senior and junior notes is allocated to the investment in Arena SOP. During the year ended December 31, 2022, the Company entered into an agreement for limited partnership interests in Brewer Lane Ventures Fund II, L.P. During the years ended December 31, 2023 and 2022, the Company invested $0.4 million and $0.2 million, respectively, in Brewer Lane Ventures Fund II, L.P. and $0.9 million and $1.3 million, respectively, in Hudson Ventures Fund 2, LP. The carrying value of equity method investments at December 31, 2023 and 2022 is as follows: ($ in thousands) 2023 2022 Arena SOP LP units $ 2,463 $ 8,734 Arena Special Opportunities Fund, LP units 41,046 44,504 Brewer Lane Ventures Fund II LP units 560 200 Dowling Capital Partners LP units 1,708 1,965 Hudson Ventures Fund 2 LP units 4,669 3,551 JVM Funds LLC units 20,061 22,473 RISCOM 4,121 4,037 Universa Black Swan LP units — 1,325 $ 74,628 $ 86,789 Equity in (loss) income from unconsolidated subsidiaries for the years ended December 31, 2023 and 2022 is summarized as follows: ($ in thousands) 2023 2022 Arena SOP LP units $ (6,271) $ 3,042 Arena Special Opportunities Fund, LP units (2,880) 3,719 Dowling Capital Partners LP units 927 502 Hudson Ventures Fund 2 LP units 170 379 JVM Funds LLC (1,198) (70) RISCOM 884 1,471 Brewer Lane Ventures Fund II LP (78) — Universa Black Swan LP units (988) (3,028) $ (9,434) $ 6,015 The unfunded commitment of equity method investments at December 31, 2023 and 2022 is as follows: ($ in thousands) 2023 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 848 1,796 $ 5,844 $ 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 which is amortized over a 15-year useful life. The following table summarizes the Company’s recorded investment in RISCOM compared to its share of underlying equity as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Investment in RISCOM: Underlying equity $ 2,620 $ 2,292 Difference 1,501 1,745 Recorded investment balance $ 4,121 $ 4,037 The Company amortizes the difference in net assets in JVM Funds LLC over the 7-year estimated useful life of the investment in rental properties. The following table summarizes the Company’s recorded investment in JVM Funds LLC compared to its share of underlying equity as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Investment in JVM Funds LLC: Underlying equity $ 19,304 $ 21,565 Difference 757 908 Recorded investment balance $ 20,061 $ 22,473 Unconsolidated Subsidiaries - Investment in Bank Holding Companies The Company carries a $2.0 million investment in Captex Bancshares, a Texas bank holding company, at cost, less impairment or observable changes in price. The Company does not have significant influence over the investee. The Company reviews these investments for impairment or observable changes in price during each reporting period. There was no impairment or observable change in price during the years ended December 31, 2023 and 2022. Unconsolidated Subsidiaries - Investment in Indirect Loans and Loan Collateral As of December 31, 2023 and 2022, the Company held indirect investments in collateralized loans and loan collateral through SMA1 and SMA2. The carrying value of the SMA1 and SMA2 as of December 31, 2023 and 2022 are as follows: ($ in thousands) 2023 2022 SMA1 $ 30,816 $ 36,426 SMA2 5,209 2,010 Investment in indirect loans and loan collateral $ 36,025 $ 38,436 Unconsolidated Subsidiaries - Investment in Trust The Company carries its investment in the common stock of the Delos Capital Trust n/k/a HIIG Capital Trust I (“Trust”) at cost. The Company does not have significant influence over the investee. There was no impairment or observable change in price during the years ended ended December 31, 2023 and 2022. See Note 10 for further information on the Trust. |
Allowance for Credit Losses
Allowance for Credit Losses | 12 Months Ended |
Dec. 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 on premiums receivable for the year ended ended December 31, 2023. ($ in thousands) Premiums Receivable, Net Allowance for Estimated Uncollectible Premiums Balance at December 31, 2022 $ 139,215 $ 629 Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 — Current period change for estimated uncollectible premiums 748 Write-offs of uncollectible premiums receivable (513) Recoveries of amounts previously written off 100 Balance at December 31, 2023 $ 179,235 $ 964 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 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. The following table sets forth the Company’s reinsurance recoverables net of credit enhancements by A.M. Best as of December 31, 2023: A.M. Best Rating December 31, 2023 A- and above 98.5 % B++ to B+ 0.7 B to B - — Not rated 0.8 The Company considers reinsurance balances to be past due when they are 90 days past due. The following table sets forth the changes in the allowance for estimated uncollectible reinsurance for the year ended ended December 31, 2023: ($ in thousands) Reinsurance Recoverables, Net Allowance for Estimated Uncollectible Reinsurance Balance at December 31, 2022 $ 581,359 $ — Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 2,295 Current period change for estimated uncollectible reinsurance — Write-offs of uncollectible reinsurance recoverables — Balance at December 31, 2023 $ 596,334 $ 2,295 |
Property and Equipment
Property and Equipment | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property and Equipment | Property and Equipment The following table presents the components of property and equipment as of December 31, 2023 and 2022, which are included within other assets on the consolidated balance sheets. ($ in thousands) 2023 2022 Leasehold improvements $ 1,892 $ 2,670 Equipment 5,033 7,230 Software 29,189 25,964 Other — 39 36,114 35,903 Accumulated depreciation (27,044) (27,229) Total $ 9,070 $ 8,674 Depreciation expense related to property and equipment was $3.2 million and $3.6 million for the years ended December 31, 2023 and 2022, respectively. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Leases | Leases The Company determines if a contract contains a lease at inception and recognizes a right-of-use asset, within other assets, and lease liability, within accounts payable and accrued liabilities, based on the present value of future lease payments. In cases where its leases do not provide an implicit interest rate, the Company uses its incremental borrowing rate based on the information available on the inception date to determine the lease liability. The Company’s leases are primarily for office facilities which have been classified as operating leases. Its leases have remaining lease terms ranging from 1 to 6 years, some of which include options to extend the leases. Lease expense for the years ended December 31, 2023 and 2022 was $2.8 million and $2.6 million, respectively. The following tables provide information regarding the Company’s leases as of and for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Operating lease right-of-use assets $ 4,905 $ 8,214 Operating lease liabilities 5,228 8,616 Operating lease weighted-average remaining lease term 4.55 years 5.00 years Operating lease weighted-average discount rate 3.95 % 3.16 % ($ in thousands) 2023 2022 Operating lease expense $ 2,583 $ 2,414 Short-term lease expense 184 220 Total lease expense $ 2,767 $ 2,634 Operating cash outflows from operating leases $ 2,636 $ 2,382 The following table sets forth the future minimum lease payment obligations of the Company’s operating leases at December 31, 2023: ($ in thousands) 2023 2024 $ 1,671 2025 1,204 2026 992 2027 903 2028 661 Thereafter 353 Total future minimum operating lease payments $ 5,784 Less imputed interest (556) Total operating lease liability $ 5,228 |
Subordinated Debt
Subordinated Debt | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Subordinated Debt | Subordinated Debt The following table summarizes the Company’s subordinated debt as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Junior subordinated interest debentures, due September 15, 2036, payable quarterly Principal $ 59,794 $ 59,794 Less: Debt issuance costs (608) (657) Unsecured subordinated notes, due May 24, 2039, interest payable quarterly Principal 20,000 20,000 Less: Debt issuance costs (496) (528) Subordinated debt, net of debt issuance costs $ 78,690 $ 78,609 In May 2019, the Company entered into an agreement to issue unsecured subordinated notes (the “Notes”) with an aggregate principal amount of $20.0 million. Interest on the Notes is fixed at 7.25% for the first 8 years and fixed at 8.25% thereafter. Early retirement of the debt ahead of 8 year commitment requires all interest payments to be paid in full as well as the return of outstanding principal. Principal is due at maturity on May 24, 2039 and interest is payable quarterly. The Notes have junior priority to all previously issued debt. The Company reports debt related to the Notes in its December 31, 2023 and 2022 consolidated balance sheets, net of debt issuance costs of approximately $0.5 million. These deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt. On August 2, 2006, the Trust issued $58.0 million of fixed/floating rate capital securities guaranteed by us. The Trust also issued us $1.8 million of common stock, classified within other long-term investments. The Company has not consolidated the Trust as it does not meet the criteria for consolidation and the Company does not have significant influence over the investee. The Company carries its investment in the common stock of the Trust at cost. There was no impairment or observable change in price during the year ended December 31, 2023. The sole asset of the Trust consists of Fixed/Floating Rate Junior Subordinated Deferrable Interest Debentures (the “Debentures”) with a principal amount of $59.8 million issued by the Company. The Debentures are an unsecured obligation that are currently redeemable, and have a maturity date of September 15, 2036. Interest on the Debentures is payable quarterly at an annual rate based on the three-month LIBOR (5.59% and 4.77% at December 31, 2023 and 2022, respectively) plus 3.4%. The Company reflects debt related to the Debentures in its December 31, 2023 and 2022 consolidated balance sheets, net of debt issuance costs of approximately $0.6 million and $0.7 million, respectively. These deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt. 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 first quarter of 2023. The Revolving Credit Facility provided the Company with up to $150.0 million, 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 year ended December 31, 2023, the Company drew $50.0 million on the Revolving Credit Facility and used the proceeds to pay off the principal on its existing term loan. The Company subsequently terminated the existing term loan and revolving line of credit. Interest on the Revolving Credit Facility is payable quarterly. The interest rate on the Revolving Credit Facility is the Secured Overnight Financing Rate (“SOFR”) plus a margin of between 150 and 190 basis points, based on the ratio of debt to total capital, and a credit spread adjustment of 10 basis points. At December 31, 2023, the six-month SOFR on the Revolving Credit Facility was 5.47%, plus a margin of 1.60%. The interest rate on the term loan was the one-month LIBOR (4.39% on December 31, 2022) plus the “Applicable Margin,” which was defined as 1.65%. The revolving line of credit included a fee of 0.25% on the unused portion. The following table sets forth the interest payments on the Company’s notes payable during the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Interest payments on terminated term loan $ 1,396 $ 1,443 Interest payments on revolving credit facility 2,598 — |
Notes_Payable
Notes Payable | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Notes Payable | Subordinated Debt The following table summarizes the Company’s subordinated debt as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Junior subordinated interest debentures, due September 15, 2036, payable quarterly Principal $ 59,794 $ 59,794 Less: Debt issuance costs (608) (657) Unsecured subordinated notes, due May 24, 2039, interest payable quarterly Principal 20,000 20,000 Less: Debt issuance costs (496) (528) Subordinated debt, net of debt issuance costs $ 78,690 $ 78,609 In May 2019, the Company entered into an agreement to issue unsecured subordinated notes (the “Notes”) with an aggregate principal amount of $20.0 million. Interest on the Notes is fixed at 7.25% for the first 8 years and fixed at 8.25% thereafter. Early retirement of the debt ahead of 8 year commitment requires all interest payments to be paid in full as well as the return of outstanding principal. Principal is due at maturity on May 24, 2039 and interest is payable quarterly. The Notes have junior priority to all previously issued debt. The Company reports debt related to the Notes in its December 31, 2023 and 2022 consolidated balance sheets, net of debt issuance costs of approximately $0.5 million. These deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt. On August 2, 2006, the Trust issued $58.0 million of fixed/floating rate capital securities guaranteed by us. The Trust also issued us $1.8 million of common stock, classified within other long-term investments. The Company has not consolidated the Trust as it does not meet the criteria for consolidation and the Company does not have significant influence over the investee. The Company carries its investment in the common stock of the Trust at cost. There was no impairment or observable change in price during the year ended December 31, 2023. The sole asset of the Trust consists of Fixed/Floating Rate Junior Subordinated Deferrable Interest Debentures (the “Debentures”) with a principal amount of $59.8 million issued by the Company. The Debentures are an unsecured obligation that are currently redeemable, and have a maturity date of September 15, 2036. Interest on the Debentures is payable quarterly at an annual rate based on the three-month LIBOR (5.59% and 4.77% at December 31, 2023 and 2022, respectively) plus 3.4%. The Company reflects debt related to the Debentures in its December 31, 2023 and 2022 consolidated balance sheets, net of debt issuance costs of approximately $0.6 million and $0.7 million, respectively. These deferred financing costs are presented as a direct deduction from the carrying amount of the subordinated debt. 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 first quarter of 2023. The Revolving Credit Facility provided the Company with up to $150.0 million, 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 year ended December 31, 2023, the Company drew $50.0 million on the Revolving Credit Facility and used the proceeds to pay off the principal on its existing term loan. The Company subsequently terminated the existing term loan and revolving line of credit. Interest on the Revolving Credit Facility is payable quarterly. The interest rate on the Revolving Credit Facility is the Secured Overnight Financing Rate (“SOFR”) plus a margin of between 150 and 190 basis points, based on the ratio of debt to total capital, and a credit spread adjustment of 10 basis points. At December 31, 2023, the six-month SOFR on the Revolving Credit Facility was 5.47%, plus a margin of 1.60%. The interest rate on the term loan was the one-month LIBOR (4.39% on December 31, 2022) plus the “Applicable Margin,” which was defined as 1.65%. The revolving line of credit included a fee of 0.25% on the unused portion. The following table sets forth the interest payments on the Company’s notes payable during the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Interest payments on terminated term loan $ 1,396 $ 1,443 Interest payments on revolving credit facility 2,598 — |
Stockholders_ Equity
Stockholders’ Equity | 12 Months Ended |
Dec. 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 reverse 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 reverse stock split of common stock for all periods presented. Initial Public Offering The Company completed its initial public offering (“IPO”) on January 18, 2023 with 4,750,000 shares offered by the Company at a price of $15.00 per share. The Company’s net proceeds from the IPO were approximately $62.0 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. 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, 1,969,660 Preferred Shares converted to 16,305,113 shares of common stock upon the Company’s closing of its IPO. Follow-On Offering On November 20, 2023, the Company completed its follow-on offering with 2,150,000 shares sold by the Company at a price of $30.50 per share. The Company’s net proceeds were approximately $62.5 million, after deducting underwriting discounts and specific incremental expenses directly attributable to the offering. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The following table sets forth the components of the Company’s income tax expense for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Current income tax expense $ 14,736 $ 120 Deferred tax expense 9,382 10,267 Income tax expense $ 24,118 $ 10,387 The Company’s provision for income taxes generally does not deviate substantially from the statutory tax rate. The effective tax rate may vary slightly from the statutory rate due to tax adjustments for tax-exempt income, dividends-received deduction and non-deductible expenses. The following table sets forth the differences between income taxes expected at the federal statutory income tax rate of 21% and the reported income tax expense for the years ended December 31, 2023 and 2022. 2023 2022 ($ in thousands) Amount Percentage Amount Percentage Income tax expense at federal statutory rate $ 23,121 21.0 % $ 10,454 21.0 % Tax advantaged investments (295) (0.3) (324) (0.7) Other 1,292 1.2 257 0.6 Total income tax expense $ 24,118 21.9 % $ 10,387 20.9 % The following table sets forth the tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and 2022: ($ in thousands) 2023 2022 Deferred tax assets: Net operating losses $ 10,655 $ 14,966 Losses and loss adjustment expenses 11,581 10,748 Unearned premiums 15,365 11,959 Unrealized losses on fixed maturity securities, available-for-sale 6,113 11,563 Stock options/awards 1,714 1,107 Other 4,237 5,297 Total deferred tax assets 49,665 55,640 Less valuation allowance (586) (586) Total deferred tax assets after valuation allowance 49,079 55,054 Deferred tax liabilities: Deferred policy acquisition costs 11,528 8,209 Other long-term investments 6,460 6,055 Section 481(a) adjustment 3,477 1,405 Unrealized gains on equity securities 3,243 825 Depreciation 1,260 1,481 Other 1,120 891 Total deferred tax liabilities 27,088 18,866 Deferred income taxes $ 21,991 $ 36,188 The Company paid $15.8 million in federal income taxes during the year ended December 31, 2023. The Company’s federal income tax returns for tax years 2020 to 2022 are subject to examination by the Internal Revenue Service. The Company has no current U.S. federal or state and local income tax examinations on-going at this time. At December 31, 2023, the Company carried no balance for uncertain tax positions. The Company had no accrual for the payment of interest and penalties at December 31, 2023 or 2022. The Company has federal net operating loss carryforwards of approximately $49.4 million. These net operating losses are set to expire beginning in 2030. The Company is limited on the utilization of $49.3 million of the net operating losses under Internal Revenue Code Section 382 (“Sec 382”) which imposes limitations on a corporation’s ability to utilize tax attributes if the corporation experiences an “ownership change” which occurred during 2014. The Sec 382 limitation is expected to result in an expiration of $2.8 million ($0.6 million tax effected) of net operating losses. A valuation allowance was established against the balance that is expected to expire without utilization. The Company generated a capital loss carryforward in 2022, resulting in a deferred tax asset of $0.7 million as of December 31, 2023. No valuation allowance is recorded against this deferred tax asset as the Company expects to utilize this carryforward before it expires in 2027. |
Reserves for Losses and Loss Ad
Reserves for Losses and Loss Adjustment Expenses | 12 Months Ended |
Dec. 31, 2023 | |
Insurance [Abstract] | |
Reserves for Losses and Loss Adjustment Expenses | Reserves for Losses and Loss Adjustment Expenses The Company presents its loss development on a consolidated basis; however, it evaluates net ultimate loss and LAE under three sub-categories: multiline solutions, short tail/monoline specialty lines and exited lines. The Company determined that these disaggregated groupings have more homogeneous risk characteristics with similar development patterns and are generally subject to similar trends. Short tail/monoline specialty lines Short tail/monoline specialty lines includes the Company’s global property & agriculture, accident & health, surety, and professional lines underwriting divisions. These are market niches for which the Company serves with monoline solutions which generally have shorter durations for losses to fully develop. Losses for these lines are generally reported within a short period of time from the date of loss, and in most instances, claims are settled and paid within a relatively short timeframe. Short tail/monoline specialty can be impacted by larger losses which can be more complex due to factors such as difficulty determining actual damages, legal and regulatory impediments potentially extending the period of time it takes to settle and pay claims. Multi-line Solutions Multi-line solutions includes the Company’s industry solutions, programs, captives and transactional E&S underwriting divisions. These are market niches for which the Company provides multiple products most frequently as an integrated solution. The multi-line solution subcategory is made up predominantly of occurrence liability including general liability, excess liability, and commercial auto. Multi-line solutions have a longer duration for losses to fully develop compared to short-tail/monoline specialty lines. Due to the unique claim characteristics of each product and the longer-tail nature of the multi-line solutions, this introduces more uncertainty as over time the claims can be impacted by changes in regulation, inflation and other unforeseen factors. Exited lines Exited lines includes all underwriting units that the Company placed in run-off and are presented separately from on-going lines of business. The following table sets forth the reconciliation of unpaid losses and loss adjustment expenses for the years ended December 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 516,664 393,939 Prior years — 14,385 Total incurred, net of reinsurance 516,664 408,324 Paid, net of reinsurance, related to: Current period 109,937 105,928 Prior years 253,481 194,836 Total paid 363,418 300,764 Net reserves for losses and LAE, end of period 859,017 705,771 Plus: reinsurance recoverable on unpaid claims, end of period 455,484 435,986 Reserves for losses and LAE, end of period $ 1,314,501 $ 1,141,757 For the year ended December 31, 2023, the Company recognized favorable development related to prior years’ loss and loss expense reserves of $9.2 million in short tail/monoline specialty lines and adverse development of $11.9 million in multi-line solutions, respectively. The favorable development in short tail/monoline specialty lines was driven by property lines of business from the 2021 accident year. The adverse development in multi-line solutions was driven by higher than expected severity in general and auto liability lines of business primarily from the 2019 accident year. During the year ended December 31, 2022, the Company’s net incurred losses for accident years 2021 and prior developed adversely by $14.4 million which was related to losses subject to the LPT. Within exited lines, adverse development of $14.5 million was from the 2019 accident year primarily driven by increased in frequency and severity in general and professional liability. The remaining $8.4 million of net adverse development was from other accident years. Within multi-line solutions, favorable development of $10.8 million was from the 2020 through 2021 accident years and was driven by reduction in frequency of claims in commercial auto and general liability. The remaining $2.3 million of net adverse development was from various other accident years. Short Duration Contract Disclosures Losses and LAE reserves represent the Company’s best estimate of the ultimate net cost of all reported and unreported losses that are unpaid as of the balance sheet dates. The Company’s estimated reserves for losses and LAE include the accumulation of estimates for claims reported and unpaid prior to the balance sheet dates, estimates (based on projections of relevant historical data) of increases in claims costs for claims already reported, of claims incurred but not reported, and estimates of expenses for investigating and adjusting all incurred and unpaid claims. In determining the cumulative number of reported claims, the Company measures claim counts by incident. The claim counts include all claims reported, even if the Company does not establish a liability for the claim (i.e. reserve for loss and loss adjustment expenses). Short Tail/Monoline Specialty ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance As of December 31, 2023 Years Ended December 31, Reported Claims Accident Year 2019* 2020* 2021* 2022* 2023 IBNR 2019 $ 65,221 $ 50,400 $ 47,600 $ 51,100 $ 53,100 $ 2,832 1,034 2020 68,190 66,690 66,690 66,690 1,877 1,288 2021 102,970 102,970 91,757 5,496 1,556 2022 125,288 125,288 57,026 2,151 2023 205,189 110,310 3,175 Total $ 542,024 Cumulative net paid loss and LAE from the table below (283,284) Net reserves for loss and LAE before 2019 17,964 Total net reserves for loss and LAE $ 276,704 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident Year 2019* 2020* 2021* 2022* 2023 2019 $ 36,013 $ 42,528 $ 43,784 $ 47,330 $ 47,255 2020 32,805 58,329 72,514 72,351 2021 17,554 52,326 66,902 2022 21,404 63,880 2023 32,896 Total $ 283,284 *Supplementary information and unaudited Multi-line Solutions ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance ($ in thousands) As of December 31, 2023 Accident Years Ended December 31, Reported Claims 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 IBNR 2014 $ 100,355 $ 100,355 $ 115,749 $ 116,970 $ 116,970 $ 117,783 $ 118,995 $ 120,731 $ 120,777 $ 118,277 $ 1,016 4,979 2015 103,191 114,266 117,024 117,024 119,216 121,746 122,881 122,902 127,102 910 5,369 2016 64,828 64,448 64,448 64,248 71,306 74,794 74,923 75,923 2,741 4,695 2017 68,650 68,650 67,578 76,231 81,807 82,080 84,580 4,803 5,524 2018 77,647 77,647 77,039 77,039 77,379 73,179 8,983 5,048 2019 110,925 109,925 109,925 114,389 125,337 5,623 6,042 2020 145,846 145,846 139,090 139,090 6,933 5,453 2021 179,174 175,173 175,173 48,993 6,611 2022 232,748 232,748 35,167 8,360 2023 308,497 168,794 7,370 Total $ 1,459,906 Cumulative net paid loss and LAE from the table below (994,414) Net reserves for loss and LAE before 2014 (2,346) Total net reserves for loss and LAE $ 463,146 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 2014 $ 32,530 $ 63,699 $ 81,251 $ 96,639 $ 101,984 $ 104,984 $ 105,756 $ 106,214 $ 104,076 $ 102,214 2015 44,152 72,137 88,833 99,401 108,291 114,098 117,295 118,166 123,268 2016 24,844 44,133 54,957 60,500 62,469 65,498 73,170 74,882 2017 27,088 45,263 56,411 67,553 70,562 72,415 74,770 2018 29,372 45,739 53,491 67,289 73,251 71,042 2019 36,512 63,022 82,296 100,094 113,207 2020 38,504 72,182 88,499 113,637 2021 44,996 84,530 105,853 2022 64,849 140,490 2023 75,051 Total $ 994,414 *Supplementary information and unaudited Exited Lines — all lines in runoff ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance ($ in thousands) As of December 31, 2023 Years Ended December 31, Reported Claims Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 IBNR 2014 $ 64,186 $ 58,170 $ 62,691 $ 63,995 $ 63,994 $ 69,120 $ 70,186 $ 71,451 $ 72,027 $ 69,027 $ 7,650 4,170 2015 61,920 65,173 68,118 70,912 75,296 80,787 83,432 84,167 87,167 3,985 4,565 2016 95,914 95,509 93,885 96,090 106,368 107,390 108,366 108,366 4,946 4,879 2017 78,246 82,668 84,872 97,578 99,559 101,865 82,865 13,081 4,318 2018 76,956 71,589 82,366 93,812 100,150 105,150 1,571 4,886 2019 91,067 94,550 96,070 110,546 117,302 2,425 5,580 2020 87,809 90,609 90,609 98,512 5,637 4,756 2021 57,392 52,392 36,294 9,014 2,337 2022 35,834 45,111 12,913 215 2023 2,930 8,478 31 Total $ 752,724 Cumulative net paid loss and LAE from the table below (637,997) Net reserves for loss and LAE before 2014 4,440 Total net reserves for loss and LAE $ 119,167 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 2014 $ 9,700 $ 30,863 $ 42,141 $ 50,785 $ 49,906 $ 52,450 $ 53,290 $ 53,615 $ 55,737 $ 56,594 2015 9,026 41,653 55,610 65,269 73,100 77,981 80,312 81,789 83,706 2016 38,191 59,237 71,852 79,669 83,115 87,393 89,565 92,867 2017 35,962 53,888 53,770 58,625 65,301 70,219 68,747 2018 27,985 62,582 69,695 82,881 93,224 103,432 2019 31,556 66,163 69,602 85,798 98,392 2020 27,476 57,959 66,477 80,744 2021 15,002 20,594 29,317 2022 19,676 22,208 2023 1,990 Total $ 637,997 *Supplementary information and unaudited The table below presents the reconciliation of the net incurred and paid loss development tables to the balance sheet reserves for losses and loss adjustment expenses at December 31, 2023 and 2022: ($ in thousands) 2023 Net reserves for losses and LAE: Short Tail/Monoline Specialty $ 276,704 Multi-line Solutions 463,146 Exited Lines 119,167 Reserves for losses and LAE, net of reinsurance 859,017 Reinsurance recoverable on unpaid claims: Short Tail/Monoline Specialty 199,044 Multi-line Solutions 252,146 Exited Lines 4,294 Total reinsurance recoverable on unpaid claims 455,484 Reserves for losses and LAE at end of year $ 1,314,501 The following table sets forth the historical average annual payout of incurred losses and allocated loss adjustment expenses (claims duration) for short-duration contracts, based on the disaggregated information in the paid loss development tables, net of reinsurance: Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1* 2* 3* 4* 5* 6* 7* 8* 9* 10* Short Tail/Monoline Specialty 54.0 % 24.7 % 12.1 % 5.0 % 2.2 % 1.0 % 0.5 % 0.2 % 0.2 % 0.1 % Multi-line Solutions 37.7 % 22.6 % 16.6 % 10.6 % 5.3 % 3.9 % 2.0 % 0.4 % 0.4 % 0.5 % Exited Lines 42.8 % 22.0 % 14.2 % 8.4 % 3.2 % 3.2 % 2.7 % 1.0 % 0.8 % 1.7 % *Supplementary information and unaudited |
Commission and Fee Income
Commission and Fee Income | 12 Months Ended |
Dec. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Commission and Fee Income | Commission and Fee Income The following table sets forth the Company’s disaggregated revenues from contracts with customers for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 SUA commission revenue $ 2,864 $ 3,224 SUA fee income 2,732 1,597 Other 468 378 Total commission and fee income $ 6,064 $ 5,199 The following table sets forth the Company’s opening and closing balances of contract assets from commission and fee income for the years ended December 31, 2023 and 2022: ($ in thousands) Contract Assets Balance at December 31, 2021 $ 1,209 Balance at December 31, 2022 1,292 Balance at December 31, 2023 976 |
Underwriting, Acquisition and I
Underwriting, Acquisition and Insurance Expenses | 12 Months Ended |
Dec. 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Amortization of policy acquisition costs $ 108,514 $ 65,695 Other operating and general expenses 134,930 116,476 Total underwriting, acquisition and insurance expenses $ 243,444 $ 182,171 |
Reinsurance
Reinsurance | 12 Months Ended |
Dec. 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 if reinsurers do not meet their obligations. The following table sets forth the effects of reinsurance on premiums written and earned for years ended December 31, 2023 and 2022: 2023 2022 ($ in thousands) Written Earned Written Earned Direct premiums $ 1,241,180 $ 1,155,835 $ 1,012,239 $ 951,121 Assumed premiums 218,649 193,971 131,713 113,610 Ceded premiums (549,138) (520,663) (468,409) (448,737) Net premiums $ 910,691 $ 829,143 $ 675,543 $ 615,994 Ceded losses and LAE incurred $ 337,011 $ 311,257 The following table sets forth the components of reinsurance recoverables and ceded unearned premium at December 31, 2023 and 2022: ($ in thousands) 2023 2022 Ceded unpaid losses and LAE $ 455,484 $ 435,986 Ceded paid losses and LAE 122,287 107,228 Loss portfolio transfer 20,858 38,145 Allowance for credit losses (2,295) — Reinsurance recoverables $ 596,334 $ 581,359 Ceded unearned premium $ 186,121 $ 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; the Company does not carry these on the balance sheet as it will only have custody over these accounts upon the failure of the reinsurer to pay amounts due. At December 31, 2023, the market value of these accounts was approximately $158.1 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. During the first quarter of 2020, the Company entered into an LPT retroactive reinsurance agreement. Under the LPT, the Company received reinsurance protection of approximately $127.4 million above the ceded losses and LAE reserves and is subject to co-participations at specified amounts. During the year ended December 31, 2022, the Company strengthened reserves for certain divisions covered by the LPT by $14.4 million, resulting in an increase in the amount ceded under this agreement. The increase in the amount ceded during the year ended December 31, 2022 were partially offset by $5.8 million of recognized gain. The following table presents the impact of the LPT on the consolidated statements of operations for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Strengthening of reserves subject to the LPT $ — $ (14,385) Reinsurance recoveries under the LPT 1,427 5,813 Pretax net impact of the LPT $ 1,427 $ (8,572) 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 was included in other assets on the consolidated balance sheets. The Company’s deposit assets as of December 31, 2023 and 2022 were $29.9 million and $41.8 million, respectively. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | Stock-Based Compensation On September 23, 2022, the Compensation Committee of the Company’s Board of Directors (“Compensation Committee”) approved the Company’s 2022 Long-Term Incentive Plan (the “2022 Plan”), which became effective on January 12, 2023. The 2022 Plan provides for the granting of restricted stock, restricted stock units, performance stock units, stock options as well as cash-based performance awards, to select employees and non-employee directors of the Company. The 2022 Plan stated that 3,200,656 shares of common stock were available for issuance. 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 1,101,856 and 198,842 shares of restricted stock and restricted stock units during the years ended December 31, 2023 and 2022, under the 2022 Plan and 2021 Plan, respectively. Members of the Board of Directors were granted 23,482 and 15,196 shares of restricted stock during the years ended December 31, 2023 and 2022, respectively, with a service period of one 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 expense for these equity-based incentives is based on their fair value at the date of grant and amortized over their vesting period. The Compensation Committee granted 759,990 stock options during the year ended December 31, 2023. The grant date fair value of the options under the 2022 Plan 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 years ended December 31, 2023 and 2022 were valued at approximately $17.7 million and $2.6 million, respectively, based on the grant date fair value. The stock options granted to employees during the year ended December 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 years ended December 31, 2023 and 2022: Award Requisite Authorized Target Year ended December 31, 2023 Market condition awards 0% — 150% 3 years 37,622 Performance condition awards 0% — 150% 3 years 95,456 Service condition awards N/A 1 to 4 years 968,778 Stock options N/A 3 to 4 years 759,990 1,861,846 Year ended December 31, 2022 Market condition awards 0% — 150% 3 years 28,495 Performance condition awards 0% — 150% 3 years 26,210 Restricted stock unit awards N/A 1 to 3 years 144,137 198,842 The following table sets forth option activity for the year ended December 31, 2023 : Weighted-Average Stock Outstanding at January 1, 2023 — Granted $ 15.00 759,990 Outstanding at December 31, 2023 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 December 31, 2023 was $14.3 million. The weighted-average remaining contractual life of the options outstanding at December 31, 2023 was 9.0 years. The following table sets forth the Company’s restricted stock and restricted stock units activity for the years ended December 31, 2023 and 2022: Weighted-Average Stock and Stock Units Non-vested at January 1, 2023 $ 12.55 419,896 Granted 16.07 1,101,856 Vested 13.39 (40,645) Forfeited 15.29 (35,658) Non-vested at December 31, 2023 $ 15.13 1,445,449 Non-vested at January 1, 2022 $ 13.23 375,643 Granted 14.17 198,842 Vested 15.16 (144,042) Forfeited 12.51 (10,547) Non-vested at December 31, 2022 $ 12.55 419,896 The total fair value of shares vested at December 31, 2023 and 2022 were $0.5 million and $2.2 million, respectively. As of December 31, 2023 the total unrecognized compensation cost related to non-vested, share-based compensation awards was $15.9 million and the weighted average period over which that cost is expected to be recognized is 1.5 years. The Company recognized $8.5 million and $2.3 million of stock-based compensation expense for the years ended December 31, 2023 and 2022, respectively. Employee Stock Purchase Plan On September 23, 2022, the Compensation Committee approved the Company’s 2022 Employee Stock Purchase Plan (the “ESPP”), which became effective on May 15, 2023. Under the ESPP, all employees of the Company may choose, at two different specified time intervals each year, to have a percentage of their annual base earnings withheld to purchase the Company’s common stock. The purchase price of the common stock is 85% of the lower of its beginning-of-period or end-of-period market price. The company has reserved 376,548 common shares under this plan. The grant date fair value of options under the ESPP was determined using the Black-Scholes model where the term was the length of time between the grant date and the date the options are exercisable of 6 months. The volatility was determined based on the historical volatility of comparable publicly traded insurance companies. As of December 31, 2023, a total of 35,430 shares had been purchased under this plan. The Company recognized $0.2 million of expense for the year ended December 31, 2023. As of December 31, 2023, the fair value of unrecognized expense was $0.3 million. Stock Notes Receivable |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The following table sets forth the compilation of basic and diluted net earnings per share for the years ended December 31, 2023 and 2022: ($ in thousands, except for share and per share amounts) 2023 2022 Numerator Net income $ 85,984 $ 39,396 Less: Undistributed income allocated to participating securities (1,677) (18,879) Net income attributable to common shareholders (numerator for basic earnings per share) 84,307 20,517 Add back: Undistributed income allocated to participating securities 1,677 18,879 Net income (numerator for diluted earnings per share under the two-class method) $ 85,984 $ 39,396 Denominator Basic weighted-average common shares 36,031,907 16,568,393 Dilutive effect of preferred shares 716,708 15,245,533 Dilutive effect of stock notes 696,110 519,080 Dilutive effect of awarded stock units 736,837 320,188 Dilutive effect of awarded options 135,972 — Diluted weighted-average common share equivalents 38,317,534 32,653,194 Basic earnings per share $ 2.34 $ 1.24 Diluted earnings per share $ 2.24 $ 1.21 The following table presents anti-dilutive instruments that were excluded from the calculation of diluted weighted-average common share equivalents during the years ended December 31, 2023 and 2022: 2023 2022 Stock notes — 60,576 Awarded stock units 3,931 — Awarded options 914 — The following table presents common share equivalents of contingently issuable instruments that were excluded from basic earnings per share in shares for the years ended December 31, 2023 and 2022: 2023 2022 Common shares 920,864 22,919 Preferred shares, if converted — 1,059,602 Total 920,864 1,082,521 |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Dec. 31, 2023 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company sponsors the 401(k) Plan (the “Plan”). The Plan, available to substantially all its employees, is subject to provisions of the Employee Retirement Income Security Act of 1974. The Company matches employee contributions on a discretionary basis. During the years ended December 31, 2023 and 2022, the Company contributed $2.9 million and $2.4 million in matching contributions to the Plan, respectively. |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | Related Party Transactions Westaim In 2014 and continuing through 2015, Westaim HIIG LP acquired a majority of the Company’s common stock. In July 2023, Westaim dissolved Westaim HIIG LP and obtained direct ownership of the Company’s common stock held by the partnership. As of December 31, 2023, Westaim owned 17.5% of the Company’s common stock. As of December 31, 2022, Westaim, including shares beneficially owned through Westaim HIIG LP, owned 44.5% of the Company’s common stock. The changes in Westaim HIIG LP’s ownership percentage were primarily due to equity offerings, conversion of preferred common stock, and distribution of shares controlled by Westaim through a limited partnership. In 2015, the Company purchased 3,076,924 shares of Westaim common stock for $8.4 million. The Company’s investment in Westaim is included in equity securities on the consolidated balance sheets. The Company had an unrealized gain on this investment of $0.5 million at December 31, 2023, and an unrealized loss of $2.3 million at December 31, 2022. Prior to the closing of the IPO, Westaim performed consulting and certain other services for the Company pursuant to a Management Services Agreement. The agreement terminated pursuant to its terms upon the closing of the IPO. RISCOM RISCOM provides the Company with wholesale brokerage services. RISCOM and the Company also have a managing general agency agreement. The Company holds a 20% ownership interest in RISCOM. Net earned premium and gross written commissions related to these agreements for the years ended December 31, 2023 and 2022 is summarized as follows: ($ in thousands) 2023 2022 Net earned premium $ 99,736 $ 91,051 Gross written commissions 24,177 23,472 Premiums receivable from RISCOM as of December 31, 2023 and 2022 were $10.6 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 a holder of preferred shares. During the year ended December 31, 2023, Mt. Whitney Securities divested their entire ownership of the Company’s equity securities. Reinsurance premiums ceded during the year ended December 31, 2022 related to the agreement was $59.6 million. Reinsurance recoverable from Everest Re, net of premium payables at December 31, 2022 was $177.5 million. Other Advisory and professional services fees and expense reimbursements paid to various affiliated stockholders and directors for the years ended December 31, 2023 and 2022 were $3.6 million and $3.4 million, respectively. See Notes 5, 6 and 10 for investments involving affiliated companies and additional related party transactions. See Note 12 for related party transactions related to the Company’s common and preferred shares. |
Commitment and Contingencies
Commitment and Contingencies | 12 Months Ended |
Dec. 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 balance sheets, consolidated statements of operations or consolidated statements of cash flows. During the years ended December 31, 2023 and 2022, the Company recorded no provision for various contingencies. Indemnification In conjunction with the sale of business assets and subsidiaries, the Company has provided indemnifications to certain of the buyers. Certain indemnifications cover typical representations and warranties related to the responsibilities to perform under the sales contracts. The amount of potential exposure covered by the indemnifications is difficult to determine because the indemnifications cover a variety of matters, operations and scenarios. Certain of these indemnifications have no time limit. As of December 31, 2023, the Company does not have reason to believe any such significant claims exist. Contingent Consideration Related to Acquisitions |
Statutory Accounting Principles
Statutory Accounting Principles and Regulatory Matters | 12 Months Ended |
Dec. 31, 2023 | |
Insurance [Abstract] | |
Statutory Accounting Principles and Regulatory Matters | Regulatory Matters The following table sets forth statutory net income and statutory capital and surplus for the Company for the years ended and as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Statutory net income $ 46,884 $ 10,860 Statutory capital and surplus 602,916 408,167 Dividend payments to the Company from HSIC are restricted by Texas state law as to the amount that may be paid without the approval of regulatory authorities. The maximum amount of dividends which can be paid by HSIC without prior approval is subject to restrictions relating to policyholder surplus, net income, and dividends declared or distributed during the preceding 12 months. As of December 31, 2023, HSIC is not restricted to paying ordinary dividends. HSIC did not declare or pay any dividend during the years ended December 31, 2023 and 2022. Property and casualty insurance companies are subject to certain Risk Based Capital (“RBC”) requirements as specified by the National Association of Insurance Commissioners (“NAIC”). Under those requirements, the amount of capital and surplus maintained by a property and casualty insurance company is to be determined based on the various risk factors related to it. As of December 31, 2023 and 2022, HSIC’s statutory capital and surplus substantially exceeded the regulatory requirements. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events |
SCHEDULE I__ SUMMARY OF INVESTM
SCHEDULE I — SUMMARY OF INVESTMENTS — OTHER THAN IN RELATED PARTIES | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Abstract] | |
SCHEDULE I — SUMMARY OF INVESTMENTS — OTHER THAN IN RELATED PARTIES | SCHEDULE I — SUMMARY OF INVESTMENTS — OTHER THAN IN RELATED PARTIES ($ in thousands) Cost Fair Value (if applicable) Amount on December 31, 2023 Fixed maturity securities, available for sale: U.S. government securities $ 44,685 $ 44,166 $ 44,166 Corporate securities and miscellaneous 392,773 383,420 383,420 Municipal securities 98,266 92,778 92,778 Residential mortgage-backed securities 292,568 281,626 281,626 Commercial mortgage-backed securities 31,411 29,934 29,934 Other asset-backed securities 188,010 185,727 185,727 Total fixed maturity securities, available for sale 1,047,713 1,017,651 1,017,651 Fixed maturity securities, held to maturity: Other asset-backed securities 43,315 41,017 42,986 Total fixed maturity securities, held to maturity 43,315 41,017 42,986 Equity securities: Common stocks 54,672 67,425 67,425 Preferred stocks 8,736 7,358 7,358 Mutual funds 39,429 43,466 43,466 Total equity securities 102,837 118,249 118,249 Mortgage loans 50,542 50,070 50,070 Other long-term investments 3,798 3,798 3,798 Short-term investments 270,226 270,226 270,226 Total $ 1,518,431 $ 1,501,011 $ 1,502,980 |
SCHEDULE II__ CONDENSED FINANCI
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT | 12 Months Ended |
Dec. 31, 2023 | |
Condensed Financial Information Disclosure [Abstract] | |
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT | SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT BALANCE SHEETS (PARENT COMPANY) December 31, ($ in thousands) 2023 2022 Assets Investments: Investment in subsidiaries $ 743,025 $ 503,549 Short-term investments, at fair value 10,593 25 Total investments 753,618 503,574 Cash and cash equivalents 3,024 8,909 Deferred income taxes 5,899 19,655 Goodwill and intangible assets, net 12,641 12,641 Other assets 15,908 6,992 Total assets $ 791,090 $ 551,771 Liabilities and Stockholders’ Equity Liabilities: Accounts payable and accrued liabilities $ 1,369 $ 1,500 Notes payable 50,000 50,000 Subordinated debt, net of debt issuance costs 78,690 78,609 Total liabilities 130,059 130,109 Stockholders’ Equity: Stockholders’ equity 661,031 421,662 Total liabilities and stockholders’ equity $ 791,090 $ 551,771 SKYWARD SPECIALTY INSURANCE GROUP, INC. AND SUBSIDIARIES SCHEDULE II — CONDENSED STATEMENTS OF OPERATIONS (PARENT COMPANY) Years Ended December 31, ($ in thousands) 2023 2022 Revenues: Net investment income $ 3,822 $ 2,567 Net investment losses (963) (6) Other losses (27) — Total revenues 2,832 2,561 Expenses Interest expense 9,815 6,407 Amortization expense 313 81 Other expenses 451 — Total expenses 10,579 6,488 Loss before income tax expense (7,747) (3,927) Income tax expense (benefit) 6,808 (1,209) Net loss before equity in earnings of subsidiaries (14,555) (2,718) Equity in undistributed earnings of subsidiaries 100,539 42,114 Net income $ 85,984 $ 39,396 SKYWARD SPECIALTY INSURANCE GROUP, INC. AND SUBSIDIARIES SCHEDULE II — CONDENSED STATEMENTS OF CASH FLOWS (PARENT COMPANY) Years Ended December 31, ($ in thousands) 2023 2022 Cash flows from operating activities: Net income $ 85,984 $ 39,396 Adjustments to reconcile net income to net cash used in operating activities (95,947) (42,672) Net cash provided by operating activities (9,963) (3,276) Cash flows from investing activities: Capital contributions to subsidiaries (122,800) — Distributions from investment in subsidiaries 6,500 4,000 Change in short-term investments (10,569) — Net cash (used in) provided by investing activities (126,869) 4,000 Cash flows from financing activities: Employee share purchases 1,350 2,180 Draw on revolving line of credit 50,000 — Repayment of term loan (50,000) — Proceeds from equity offerings 128,887 — Proceeds from employee stock purchase plan 710 — Net cash provided by financing activities 130,947 2,180 Net (decrease) increase in cash and cash equivalents and restricted cash (5,885) 2,904 Cash and cash equivalents and restricted cash at beginning of year 8,909 6,005 Cash and cash equivalents and restricted cash at end of year $ 3,024 $ 8,909 Supplemental disclosure of cash flow information: Cash paid for interest $ 10,667 $ 5,761 Cash paid for federal income taxes 15,800 — |
SCHEDULE IV__ REINSURANCE
SCHEDULE IV — REINSURANCE | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Abstract] | |
SCHEDULE IV — REINSURANCE | SCHEDULE IV — REINSURANCE Years Ended December 31, 2023 2022 ($ in thousands) Accident & Property & Accident & Property & Gross amount $ 151,702 $ 1,089,478 $ 130,377 $ 881,862 Ceded to other companies (79,091) (470,047) (70,291) (398,118) Assumed from other companies — 218,649 431 131,282 Net amount $ 72,611 $ 838,080 $ 60,517 $ 615,026 Percentage of amount assumed to net — % 26.1 % 0.7 % 21.3 % |
SCHEDULE V__ VALUATION AND QUAL
SCHEDULE V — VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
SCHEDULE V — VALUATION AND QUALIFYING ACCOUNTS | SCHEDULE V — VALUATION AND QUALIFYING ACCOUNTS ($ in thousands) Valuation Allowance for Allowance for Balance at January 1, 2022 $ 586 $ — $ 261 Charged to costs and expenses — — 584 Amounts written off — — (216) Balance at December 31, 2022 586 — 629 Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 — 2,295 — Charged to costs and expenses — — 748 Amounts written off — — (513) Recoveries of amounts previously written off — — 100 Balance at December 31, 2023 $ 586 $ 2,295 $ 964 |
SCHEDULE VI__ SUPPLEMENTAL INFO
SCHEDULE VI — SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS | 12 Months Ended |
Dec. 31, 2023 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Abstract] | |
SCHEDULE VI — SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS | SCHEDULE VI — SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS As of and Years Ended December 31, ($ in thousands) 2023 2022 Deferred policy acquisition costs $ 91,955 $ 68,938 Reserve for losses and loss adjustment expenses 1,314,501 1,141,757 Unearned premiums 552,532 442,509 Net earned premium (1) 829,143 615,994 Net investment income 40,322 36,931 Losses and loss adjustment expenses (current year) (1) 516,664 393,939 Losses and loss adjustment expenses (prior years) (1)(2) — 14,385 Amortization of policy acquisition costs (1) 108,514 65,695 Paid claims and claim adjustment expenses (1) 363,418 300,764 Net premiums written (1) 910,691 675,543 Ceded unearned premium 186,121 157,645 Deferred ceding commission 37,057 29,849 (1) Amount is presented net of reinsurance (2) Amount does not include gain on retroactive reinsurance which is included in losses and loss adjustment expenses presented on the Consolidated Statements of Operations |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Pay vs Performance Disclosure | ||
Net income | $ 85,984 | $ 39,396 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 shares | Dec. 31, 2023 shares | |
Trading Arrangements, by Individual | ||
Non-Rule 10b5-1 Arrangement Adopted | false | |
Rule 10b5-1 Arrangement Terminated | false | |
Non-Rule 10b5-1 Arrangement Terminated | false | |
Andrew Robinson [Member] | ||
Trading Arrangements, by Individual | ||
Material Terms of Trading Arrangement | On November 30, 2023, Andrew Robinson, Chief Executive Officer, adopted a Rule 10b5-1 trading plan. Mr. Robinson’s plan provides for the sale of up to 126,748 shares of our common stock by December 31, 2024. This plan was entered into during an open insider trading window and is intended to satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act and our policies regarding transactions in our securities. | |
Name | Andrew Robinson | |
Title | Chief Executive Officer | |
Rule 10b5-1 Arrangement Adopted | true | |
Adoption Date | November 30, 2023 | |
Arrangement Duration | 397 days | |
Aggregate Available | 126,748 | 126,748 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The Company’s consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”), which differ in some respects from those followed in reports to insurance regulatory authorities. The consolidated financial statements includes the accounts of the holding company and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect amounts reported in the consolidated financial statements and accompanying notes. The Company’s actual results could differ from those estimates. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash on hand and fixed maturity securities with original maturities of three months or less. The carrying value of the Company’s cash and cash equivalents approximates fair value. |
Restricted Cash | Restricted Cash Cash with a legal restriction on withdrawal or use by the consolidated group is recorded as restricted cash. The carrying value of the Company’s restricted cash approximates fair value. SUA collects premiums from clients, and after deducting commissions and any applicable fees, remits these premiums to the Company’s insurance companies, or to third-party insurance companies. SUA holds unremitted insurance premiums in a fiduciary capacity to third-party insurance companies, as restricted cash. The Company is required by state regulations to maintain assets on deposit with certain states and hold cash as collateral for certain reinsurance balances. Cash held in a depository account for others, or restricted by a state, is recorded as restricted cash. |
Investments | Investments Available for Sale Investments in fixed maturities that are classified as available-for-sale 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 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 income 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 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 loss. Held to maturity Investments in fixed maturity securities that are 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 multi-year cumulative loss rates for asset backed securities. The 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 income on the consolidated statements of operations. Other-than-Temporary Impairments Prior to the adoption of ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326), on January 1, 2023, the Company evaluated declines in the market value of invested assets below amortized cost, for other-than-temporary impairment losses, on a quarterly basis. Impairment losses for declines in the value of its fixed maturity securities below amortized cost attributable to issuer-specific events were based on all relevant facts and circumstances for each investment and were recognized when appropriate. For all investments with unrealized losses due to market conditions or industry-related events where the Company did not had intent to sell the security and it had the ability to hold the investment for either a period of time sufficient to allow a market recovery or to maturity, declines in value below cost were not assumed to be other-than-temporary. When the Company considered the impairment of the value of an investment to be other-than-temporary, it reported the decrease in value in net income within the consolidated statements of operations and a corresponding reduction in carrying value on the consolidated balance sheet. Equity securities with a readily determinable fair value Equity securities consists of common stock or preferred stock. Mutual funds, including those that invest mostly in debt securities, are classified as equity securities. Investments in equity securities with a readily determinable fair value are carried on the balance sheet at fair value using quoted market prices. Changes in the carrying value of equity securities are included in net investment gains (losses) within the consolidated statements of operations. Mortgage loan s Investments in mortgage loans are classified as held for investment and carried on the balance sheet at cost adjusted for unamortized premiums, discounts and loan fees. When an amount is determined to be uncollectible, the Company writes off the uncollectible amount in the period it was determined to be uncollectible. Interest on the loans is recognized as interest receivable which the Company includes in other assets on the consolidated balance sheet. The Company elected the fair value option in accounting for mortgage loans effective January 1, 2023 as targeted transition relief from the adoption of ASU 2016-13. 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. Other long-term investments Other long-term investments include investments in equity and equity securities of non-public entities and indirect investments in loans and loan collateral. The Company has equity investments in certain limited partnerships and corporations where it has significant influence but not control. The analysis of entities that are variable interest entities indicated the Company is not the primary beneficiary, and would not have to consolidate these entities. Equity method is used to account for these investments in unconsolidated subsidiaries. Under the equity method, initial investment is recorded at cost and is subsequently adjusted based on its proportionate share of distributions and net income or loss of the equity method investee. The difference between the cost of an investment and its proportionate share of the underlying equity in net assets recorded on the investee’s books is a component of investment income. The Company amortizes the difference as an adjustment to its pro-rata share of equity method income over the useful life which is based on the underlying asset. The Company does not have significant influence in its investments in equity securities of non-public entities. When these securities do not have a readily determinable fair value, the Company carries these investments at cost, minus impairment, if any, and changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Investments in indirect collateralized loans and loan collateral are held through and accounted for as an ownership interest in an unconsolidated subsidiary. The Company’s ownership interests in unconsolidated subsidiaries consists of investments in entities such as partnerships, joint ventures, and special purpose investment vehicles. The Company has significant influence, but not control of these unconsolidated subsidiaries and uses the equity method to account for these investments. Short-Term Investments Short-term investments consist primarily of money market funds and are carried at cost which approximates fair value. Net Investment Income and Net Realized Gains and Losses Net investment income consists of interest, dividends and equity in earnings (losses) of unconsolidated subsidiaries net of investment expenses such as investment management expenses. Interest income is recognized on the accrual basis, and dividends as earned at the ex-dividend date. Interest income on mortgage-backed and other asset-backed securities is recognized using the effective-yield method based on estimated principal repayments. Included in interest income is the amortization of premium and accretion of discounts on debt securities. Net realized gains and losses on investments are recognized in net income based upon the specific identification method. |
Reinsurance | Reinsurance Reinsurance Accounting In the normal course of business, the Company purchases prospective reinsurance for certain lines of business on a proportional, excess of loss and facultative basis. Proportional reinsurance requires the Company to share the losses and expenses with the reinsurer in exchange for a share of the premiums. Excess of loss reinsurance shares losses, either a proportion of or in its entirety, above a certain dollar threshold, in exchange for a negotiated cost. Facultative reinsurance covers specific risks and/or policies on either a proportional or excess of loss basis. Ceded unearned premium and reinsurance balances recoverable—on paid and unpaid losses and settlement expenses—are reported separately as assets, instead of netting them with the related liabilities, since reinsurance does not relieve the Company of its legal liability to its policyholders. Reinsurance on unpaid losses and settlement expenses represent estimates of the portion of the liabilities recoverable from reinsurers. On the Consolidated Statements of Operations, net earned premiums, losses and loss adjustment expenses, net and underwriting, acquisition and insurance expenses are presented net of reinsurance ceded. The Company purchases retroactive reinsurance on certain lines of business in the form of loss portfolio transfers (“LPT”) and adverse development covers. These contracts provide indemnification of losses related to past loss events where the reinsurer shares losses, either a proportion of or in its entirety, depending on certain dollar thresholds. Income generated from retroactive reinsurance contracts is deferred and amortized into net income over the settlement period and losses are charged to net income immediately. Subsequent changes in the measurement of the retroactive reinsurance contract are accounted for under a full retrospective method. Deposit Accounting Certain ceded reinsurance contracts, which management determines do not transfer significant insurance risk, are accounted for using the deposit method of accounting. The evaluation of the transfer of significant insurance risk involves an assessment of both timing risk and underwriting risk. Management may determine that a reinsurance contract does not transfer significant insurance risk if either underwriting risk or timing risk or both are not deemed to have been transferred. For those contracts that transfer only significant timing risk and do not transfer sufficient underwriting risk, a deposit asset is recorded equal to the initial cash outflow under the contract, which will then be offset by cash inflows received from the reinsurers. To the extent cash outflows are expected to differ from expected cash inflows, an accretion rate is established at inception of the contract based on actuarial estimates whereby the deposit accounting asset is increased/decreased to the estimated amount receivable over the contract term. The accretion of the deposit is based on the expected rate of return implied from the estimated cash inflows and outflows under the contract. Periodically, the Company reassesses the estimated ultimate receivable and the related expected rate of return on the deposit asset. The accretion of the deposit asset, including any changes in accretion resulting from changes in estimated cash flows, are reflected as part of investment income in the Company’s results of operations. Several reinsurance contracts require deposit accounting treatment due to not transferring sufficient underwriting risk. There were no reinsurance contracts that require deposit accounting treatment due to not transferring sufficient timing risk. 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. The historical loss rate is adjusted for current conditions, 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. Reinsurance does not relieve the Company of its legal liability to its policyholders. The Company continuously monitors the financial condition of its reinsurers. As part of its monitoring efforts, the Company reviews the reinsurers’ annual financial statements. The Company also reviews insurance industry developments that may impact the financial condition of its reinsurers. The Company analyzes the credit risk associated with its reinsurance recoverables by monitoring the financial strength rating of its reinsurers from A.M. Best. It also assesses the adequacy of collateral obtained, where applicable. Should its reinsurers fail to fulfill their obligations, the Company has access to collateral from various reinsurers. As of December 31, 2023 and 2022, reinsurance collateral from reinsurers was $257.5 million and $253.9 million, respectively. |
Concentration of Credit Risk | Concentration of Credit Risk Other than reinsurance recoverables, financial instruments that potentially subject us to concentrations of credit risk are primarily cash and cash equivalents, restricted cash, investments and premiums receivable. Cash equivalents and short-term investments include U.S. government securities and money market funds. Investments are diversified throughout many industries and geographic regions. The Company limits the amount of credit exposure with any one financial institution or issuer and believes no significant concentration of credit risk exists with respect to cash and investments. As of December 31, 2023 and 2022, outstanding premiums receivable are generally diversified due to the large number of entities comprising the Company’s customer base and their dispersion across many different lines of business and geographic regions. Failure by distribution sources to remit premiums could result in premium write-offs and a corresponding loss of income. |
Deferred Policy Acquisition Costs | Deferred Policy Acquisition Costs Policy acquisition costs consist of commissions and premium taxes that vary with and are directly related to the successful production of new or renewal business. The Company defers policy acquisition costs and related ceding commissions and charge or credit them to earnings in proportion with the premium earned over the life of the policy. A premium deficiency is recognized if the sum of expected losses, loss adjustment expenses, and unamortized acquisition costs exceed its related unearned premiums. The Company first recognizes a premium deficiency by charging any unamortized acquisition costs to expense to the extent required to eliminate the deficiency. If its premium deficiency is greater than unamortized acquisition costs, it accrues a liability for the excess deficiency. Anticipated investment income is considered in the determination of premium deficiencies. Management performed an analysis and determined no premium deficiency existed as of December 31, 2023 and 2022. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets Goodwill and intangible assets are recorded as a result of a business combination. Goodwill represents the excess of the purchase price over the fair value of the assets acquired and liabilities assumed. The Company reviews its purchase price allocation up to one year subsequent to an acquisition and may make adjustments within the one-year period. The Company amortizes identifiable intangible assets with a finite useful life over the period that the intangible asset is expected to contribute directly or indirectly to its future cash flows; however, it does not amortize indefinite lived intangible assets. The Company reviews goodwill and identifiable intangible assets for recoverability annually in the fourth quarter or on an interim basis should events or changes in circumstances indicate that a carrying amount may not be recoverable. Based upon this review, the Company did not have any goodwill impairment for the years ended December 31, 2023 and 2022. |
Property and Equipment | Property and Equipment Property and equipment, which is included in other assets on the consolidated balance sheets, is recorded at cost less accumulated depreciation. Depreciation expense is recognized on a straight-line basis for financial statement purposes over periods ranging from three |
Leases | Leases Right-of-use (ROU) assets are included in other assets and lease liabilities are included in accounts payable and accrued liabilities on the consolidated balance sheets. For operating leases, the Company determines if a contract contains a lease at inception and recognizes the operating lease ROU assets and lease liabilities based on the present value of the future minimum lease payments at the commencement date. As the Company does not have the interest rate implicit in its leases, it uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of future payments. Lease agreements may include options to extend or terminate. The options are exercised at the Company’s discretion and are included in operating lease liabilities if it is reasonably certain the option will be exercised. Lease agreements have lease and non-lease components, which are accounted for as a single lease component. Operating lease cost for future minimum lease payments is recognized on a straight-line basis over the lease term. Sublease income is recognized on a straight-line basis over the sublease term. |
Reserves for Losses and Loss Adjustment Expenses | Reserves for Losses and Loss Adjustment Expenses Reserves for losses and loss adjustment expenses (“LAE”) represent the Company’s best estimate of the ultimate net cost of all reported and unreported losses that are unpaid as of the balance sheet dates. The estimates are based on certain actuarial and other assumptions related to the ultimate cost to settle such claims. Such assumptions are subject to occasional changes due to evolving economic, social and political conditions. Because of the nature of business the Company has historically written, management believes that it has limited exposure to environmental and other toxic tort type claim liabilities. All estimates are periodically reviewed and, as experience develops and new information becomes known, the reserves are adjusted as necessary. Such adjustments are reflected in the results of operations in the period in which they are determined. Due to the inherent uncertainty in estimating reserves for losses and settlement expenses, there can be no assurance that the ultimate liability will not exceed recorded amounts. If actual liabilities do exceed recorded |
Premiums | Premiums The Company earns and recognizes property and casualty and surety premiums on a pro-rata basis over the terms of the policies. The Company earns accident and health premiums as billed, based on census data. Gross premiums written are reduced by ceded premiums from proportional, facultative and excess of loss reinsurance costs for prospective reinsurance. Its premiums receivable includes deferred premiums, which represent installment payments the Company is due from insureds under the payment terms of their policies. Premiums receivable 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. Unearned premiums represent the portion of gross premiums written which is applicable to the unexpired terms of insurance policies or reinsurance contracts in force. Ceded unearned premiums represent the portion of ceded premiums written which is applicable to the unexpired terms of insurance policies or reinsurance contracts in force. These unearned premiums are calculated on a pro-rata basis over the terms of the policies for direct and ceded amounts. |
Commission and Fee Income | Commission and Fee Income SUA commission revenue SUA commission revenue is generated from the placement of insurance policies on reinsurance programs through a reinsurance broker which represents the Company’s single performance obligation. Its transaction price is fixed at contract inception and based on a percentage of premiums placed. The Company recognizes 100% of the transaction price as the associated performance obligation is satisfied at the point in time a policy is placed as it has no constraints on revenue. SUA fee income SUA fee income is generated from the placement of insurance policies with a third-party insurance company. The Company’s single performance obligation consists of the placement of the policy. Its transaction price is variable at contract inception and based on a percentage of premium based on risk factors that vary every month such as employee census data and worker roles. The Company estimates its transaction price over the life of the policy using the expected value method and recognizes revenue at the point in time the policy is placed. When there are changes in the estimate of variable consideration, it recognizes those changes in the month they occur. |
Income Taxes | Income Taxes Income tax expense is accrued for the tax effects of transactions reported on the consolidated financial statements, and this provision for income taxes consists of taxes currently due plus deferred taxes resulting from temporary differences between amounts reported for financial statement and income tax purposes. A valuation allowance is established for any deferred tax asset not expected to be realized. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities from a change in tax rates is recognized in income in the period that includes the enactment date. A liability for uncertain tax positions is recorded where it is more likely-than-not that the tax position will not be sustained upon examination by the appropriate tax authority. Changes in the liability for uncertain tax positions are reflected in income tax expense in the period when a new uncertain tax position arises, judgment changes about the likelihood of an uncertainty, the tax issue is settled, or the statute of limitation expires. Any potential net interest income or expense and penalties related to uncertain tax positions are recorded on the Consolidated Statements of Operations. The Company files a consolidated federal income tax return in the United States and certain other state tax returns. Its admitted insurance subsidiaries pay premium taxes on gross written premiums in lieu of most state income or franchise taxes. Premium tax expense is recognized within underwriting, acquisition and insurance expense on the Consolidated Statements of Operations. |
Fair Value of Financial Instruments | Fair Value of Financial Instruments Fair value is estimated for each class of financial instrument based on the framework established in the fair value accounting guidance. This guidance requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. Fair value hierarchy disclosures are based on the quality of inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). As a part of management’s process to determine fair value, the Company utilizes widely recognized, third-party pricing sources to determine the Company’s fair values of financial instruments. The Company has obtained an understanding of the third-party pricing sources’ valuation methodologies and inputs. |
Stock Based Compensation | Stock-Based Compensation We expense the estimated fair value of employee stock options and similar awards. We measure compensation cost for awards of equity instruments to employees based on the grant-date fair value of those awards and recognize compensation expense over the service period that the awards are expected to vest. The tax effects related to share-based payments are made through net earnings. See note 18 for further discussion and related disclosures regarding stock-based compensation. Employee Stock Purchase Plan |
Earnings Per Share | Earnings Per Share Basic earnings per share is calculated using the two-class method. Undistributed earnings are allocated to participating securities based on the extent to which each class may share in earnings as if all the earnings for the period have been distributed. Basic earnings per share is calculated by dividing net income attributable to common shareholders by the weighted-average number of common shares outstanding for the period. Common shares, when contingencies, such as vesting requirements, exist and have not been satisfied, are excluded from basic earnings per share. 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. 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. These instruments are excluded from basic and diluted earnings per share when the specified conditions are not met presuming the end of the period is the end of the contingency period. The impact of the contingently issuable instruments on diluted earnings per share was calculated using the treasury stock method and included in the reconciliation of the denominator of the basic and diluted earnings per share computations for the years ended December 31, 2023 and 2022. Instruments that are convertible into common shares are included in diluted weighted-average common shares outstanding on an if-converted basis based on the legal conversion rate for the respective period, if dilutive. Share-based awards to employees with only service conditions are included as potential common shares, weighted for the portion of the period they are unvested, if dilutive. Share-based awards to employees with performance and service or market conditions are included as potential common shares presuming the end of the period is the end of the contingency period, if dilutive. When inclusion of common share adjustments increases the earnings per share or reduces the loss per share, the effect on earnings is anti-dilutive, and the diluted net earnings or net loss per share is computed excluding these common share equivalents. |
Recent Accounting Standards Adopted and Not Yet Adopted | Recent Accounting Standards Adopted In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (Topic 326). ASU 2016-13 requires organizations to estimate credit losses on certain types of financial instruments, including receivables and available-for-sale debt securities, by introducing an approach based on expected losses. The expected loss approach will require 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 the Company recognizing an increase in the allowance for uncollectible reinsurance of $2.3 million an d an increase, net of tax, in accumulated deficit of $2.3 million. Recent Accounting Standards Not Yet Adopted In November 2023, the FASB issued ASU 2023-07, Improvements to Reportable Segment Disclosures (Topic 280). ASU 2023-07 requires segment disclosures for (i) significant segment expenses that are regularly provided to the chief operating decision maker (“CODM”), (ii) how the CODM uses the reported measure(s) of segment profitability in assessing segment performance and resource allocation and (iii) the title and position of the CODM. This update states that entities with a single reportable segment are required to provide full segment disclosures. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. This update is applied retrospectively to all prior periods presented. The Copmany is evaluating the effect of the amendments on its consolidated financial statements. In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (Topic 740). ASU 2023-09 requires public companies, on an annual basis, provide enhanced rate reconciliation disclosures, including disclosures of specific categories and additional information that meet a quantitative threshold. This update also requires public companies to, among other things, disaggregate income taxes paid by federal, state and foreign taxes. The guidance is effective for fiscal years beginning after December 15, 2024. The Company is evaluating the effect of the amendments on its consolidated financial statements. |
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 other 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 December 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 observable (Level 2). Subordinated debt: |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following tables set forth the carrying amount and changes in the balance of goodwill by reporting unit at December 31, 2023 and 2022: ($ in thousands) Accident Surety Industry Solutions Other Total Goodwill Gross balance at December 31, 2022 $ 91,577 $ 6,781 $ 10,204 $ 3,879 $ 112,441 Accumulated impairment at December 31, 2022 (44,821) — — (1,886) (46,707) Net balance at December 31, 2023 $ 46,756 $ 6,781 $ 10,204 $ 1,993 $ 65,734 ($ in thousands) Accident Surety Industry Solutions Other Total Goodwill Gross balance at December 31, 2021 $ 91,577 $ 6,781 $ 10,204 $ 3,879 $ 112,441 Accumulated impairment at December 31, 2021 (44,821) — — (1,886) (46,707) Net balance at December 31, 2022 $ 46,756 $ 6,781 $ 10,204 $ 1,993 $ 65,734 |
Schedule of Intangible Assets and Goodwill | The following tables set forth the carrying amount and changes in the balance of other intangible assets at December 31, 2023 and 2022: ($ in thousands) Agent Non-competes Trademarks Licenses Total Other Intangible Assets Gross balance at December 31, 2022 $ 24,558 $ 1,117 $ 999 $ 14,019 $ 40,693 Accumulated amortization at December 31, 2022 (15,664) (893) — — (16,557) Additions 50 — — — 50 Amortization (1,261) (224) — (1,485) Net balance at December 31, 2023 $ 7,683 $ — $ 999 $ 14,019 $ 22,701 ($ in thousands) Agent Non-competes Trademarks Licenses Total Other Intangible Assets Gross balance at December 31, 2021 $ 24,558 $ 1,117 $ 999 $ 14,019 $ 40,693 Accumulated amortization at December 31, 2021 (14,421) (670) — — (15,091) Amortization (1,243) (223) — — (1,466) Net balance at December 31, 2022 $ 8,894 $ 224 $ 999 $ 14,019 $ 24,136 |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | The following table sets forth the estimated future net amortization expense of intangible assets: ($ in thousands) Years Ending December 31, Amount 2024 $ 1,099 2025 998 2026 553 2027 553 2028 553 |
Investments (Tables)
Investments (Tables) | 12 Months Ended |
Dec. 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 of investments at December 31, 2023 and 2022: ($ in thousands) Gross Gross Gross Allowance for Credit Losses Fair Value December 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 44,685 $ 202 $ (721) $ — $ 44,166 Corporate securities and miscellaneous 392,773 6,408 (15,761) — 383,420 Municipal securities 98,266 655 (6,143) — 92,778 Residential mortgage-backed securities 292,568 3,556 (14,498) — 281,626 Commercial mortgage-backed securities 31,411 449 (1,926) — 29,934 Other asset-backed securities 188,010 1,221 (3,504) — 185,727 Total fixed maturity securities, available-for-sale $ 1,047,713 $ 12,491 $ (42,553) $ — $ 1,017,651 Fixed maturity securities, held-to-maturity: Other asset-backed securities $ 43,315 $ — $ (1,969) $ (329) $ 41,017 Total fixed maturity securities, held-to-maturity $ 43,315 $ — $ (1,969) $ (329) $ 41,017 ($ 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 Other 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: Other 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 amortized cost and estimated fair value of fixed maturity securities, available for sale, at December 31, 2023 by contractual maturity are shown below. 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. ($ in thousands) Amortized Fair Value Due in less than one year $ 30,918 $ 30,518 Due after one year through five years 289,151 280,212 Due after five years through ten years 162,380 159,863 Due after ten years 53,275 49,771 Mortgage-backed securities 323,979 311,560 Other asset-backed securities 188,010 185,727 Total $ 1,047,713 $ 1,017,651 |
Debt Securities, Available-for-Sale, Unrealized Loss Position, Fair Value | The following tables summarize gross unrealized losses and the corresponding fair values of investments, aggregated by length of time that individual securities have been in a continuous unrealized loss position: Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Fair Value Gross Fair Value Gross December 31, 2023 Fixed maturity securities, available-for-sale: U.S. government securities $ 7,342 $ (25) $ 25,604 $ (696) $ 32,946 $ (721) Corporate securities and miscellaneous 26,742 (570) 174,947 (15,191) 201,689 (15,761) Municipal securities 16,815 (290) 47,269 (5,853) 64,084 (6,143) Residential mortgage-backed securities 37,634 (602) 103,495 (13,896) 141,129 (14,498) Commercial mortgage-backed securities 4,942 (74) 15,290 (1,852) 20,232 (1,926) Other asset-backed securities 27,887 (106) 75,253 (3,398) 103,140 (3,504) Total fixed maturity securities, available-for-sale 121,362 (1,667) 441,858 (40,886) 563,220 (42,553) Fixed maturity securities, held-to-maturity: Other asset-backed securities — — 41,017 (1,969) 41,017 (1,969) Total fixed maturity securities, held-to-maturity — — 41,017 (1,969) 41,017 (1,969) Total $ 121,362 $ (1,667) $ 482,875 $ (42,855) $ 604,237 $ (44,522) Less than 12 Months 12 Months or More Total ($ in thousands) Fair Value Gross Fair Value Gross Fair Value Gross 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) Other 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: Other 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Gross realized gains Fixed maturity securities, available-for-sale $ 1,042 $ 313 Equity securities 6,035 3,865 Other 2 36 Total 7,079 4,214 Gross realized losses Fixed maturity securities, available-for-sale (1,879) (958) Equity securities (5,256) (3,827) Other (2) (76) Total (7,137) (4,861) Net unrealized gains (losses) on investments Equity securities 11,516 (15,058) Mortgage loans (386) — Net investment gains (losses) $ 11,072 $ (15,705) |
Investment Income | The following table sets forth the proceeds from sales of debt and equity securities for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for-sale $ 26,626 $ 13,964 Equity securities 40,201 37,177 The following table sets forth the components of net investment income for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for-sale $ 34,703 $ 18,481 Fixed maturity securities, held-to-maturity 4,163 5,375 Equity securities 3,418 3,579 Equity method investments (9,434) 6,015 Mortgage loans 5,474 4,767 Indirect loans (4,155) 4,846 Short-term investments 11,392 1,498 Other 318 (77) Investment income 45,879 44,484 Investment expenses (5,557) (7,553) Net investment income $ 40,322 $ 36,931 The Company’s gross investment income for the years ended December 31, 2023 and 2022 is as follows: Years Ended December 31, ($ in thousands) 2023 2022 Retail $ 1,853 $ 1,255 Commercial 2,340 1,242 Industrial — 565 Multi-family 44 909 Office 203 385 Hospitality 1,034 411 $ 5,474 $ 4,767 |
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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities $ 25,952 $ (60,918) Deferred income taxes (5,420) 12,793 Total $ 20,532 $ (48,125) |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 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 December 31, 2023: December 31, 2023 High 9.50 % Low 3.25 % Weighted average 7.05 % |
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 December 31, 2023 and December 31, 2022: December 31, 2023 ($ in thousands) Level 1 Level 2 Level 3 Total Fixed maturity securities, available-for-sale: U.S. government securities $ 44,166 $ — $ — $ 44,166 Corporate securities and miscellaneous — 383,420 — 383,420 Municipal securities — 92,778 — 92,778 Residential mortgage-backed securities — 281,626 — 281,626 Commercial mortgage-backed securities — 29,934 — 29,934 Other asset-backed securities — 185,727 — 185,727 Total fixed maturity securities, available-for-sale 44,166 973,485 — 1,017,651 Fixed maturity securities, held-to-maturity: Other asset-backed securities — — 41,017 41,017 Total fixed maturity securities, held-to-maturity — — 41,017 41,017 Common stocks: Consumer discretionary 2,313 — — 2,313 Consumer staples 14,015 — — 14,015 Energy 3,187 — — 3,187 Finance 24,267 — — 24,267 Industrial 12,170 — — 12,170 Information technology 5,192 — — 5,192 Materials 3,782 — — 3,782 Other 2,499 — — 2,499 Total common stocks 67,425 — — 67,425 Preferred stocks: Consumer staples — 433 — 433 Finance — 5,061 — 5,061 Industrial — 1,052 — 1,052 Other — 812 — 812 Total preferred stocks — 7,358 — 7,358 Mutual funds: Fixed income 5,405 — — 5,405 Equity 37,546 — — 37,546 Commodity 515 — — 515 Total mutual funds 43,466 — — 43,466 Total equity securities 110,891 7,358 — 118,249 Mortgage loans — — 50,070 50,070 Short-term investments 270,226 — — 270,226 Total investments $ 425,283 $ 980,843 $ 91,087 $ 1,497,213 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 Other 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: Other 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, 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 year ended December 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total losses for the period recognized in net investment gains (losses) (385) Issuances 27,642 Settlements (30,029) Balance at December 31, 2023 $ 50,070 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 $ (426) |
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 year ended December 31, 2023: ($ in thousands) Mortgage Loans Balance at December 31, 2022 $ 52,842 Total losses for the period recognized in net investment gains (losses) (385) Issuances 27,642 Settlements (30,029) Balance at December 31, 2023 $ 50,070 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 $ (426) |
Summary of Subordinated Debt | The following table sets forth the Company’s carrying and fair values of notes payable and subordinated debt as of December 31, 2023 and December 31, 2022: December 31, 2023 December 31, 2022 ($ in thousands) Carrying Fair Carrying Fair Notes payable Term loan $ — $ — $ 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 $ 59,186 $ 59,794 $ 59,137 $ 59,794 Unsecured subordinated notes 19,504 21,378 19,472 18,934 Subordinated debt, net of debt issuance costs $ 78,690 $ 81,172 $ 78,609 $ 78,728 The following table summarizes the Company’s subordinated debt as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Junior subordinated interest debentures, due September 15, 2036, payable quarterly Principal $ 59,794 $ 59,794 Less: Debt issuance costs (608) (657) Unsecured subordinated notes, due May 24, 2039, interest payable quarterly Principal 20,000 20,000 Less: Debt issuance costs (496) (528) Subordinated debt, net of debt issuance costs $ 78,690 $ 78,609 |
Mortgage Loans (Tables)
Mortgage Loans (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Receivables [Abstract] | |
Schedule of Accounts, Notes, Loans and Financing Receivable | The carrying value of the Company’s mortgage loans as of December 31, 2023 and 2022 were as follows: ($ in thousands) 2023 2022 Retail $ 16,072 $ 16,516 Commercial 14,469 15,309 Industrial 6,785 6,329 Multi-family — 5,593 Office — 3,197 Hospitality 12,744 4,915 $ 50,070 $ 51,859 |
Investment Income | The following table sets forth the proceeds from sales of debt and equity securities for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Fixed maturity securities, available-for-sale $ 26,626 $ 13,964 Equity securities 40,201 37,177 The following table sets forth the components of net investment income for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Income: Fixed maturity securities, available-for-sale $ 34,703 $ 18,481 Fixed maturity securities, held-to-maturity 4,163 5,375 Equity securities 3,418 3,579 Equity method investments (9,434) 6,015 Mortgage loans 5,474 4,767 Indirect loans (4,155) 4,846 Short-term investments 11,392 1,498 Other 318 (77) Investment income 45,879 44,484 Investment expenses (5,557) (7,553) Net investment income $ 40,322 $ 36,931 The Company’s gross investment income for the years ended December 31, 2023 and 2022 is as follows: Years Ended December 31, ($ in thousands) 2023 2022 Retail $ 1,853 $ 1,255 Commercial 2,340 1,242 Industrial — 565 Multi-family 44 909 Office 203 385 Hospitality 1,034 411 $ 5,474 $ 4,767 |
Other Long-Term Investments (Ta
Other Long-Term Investments (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Carrying Value of Equity Method Investments | The carrying value of equity method investments at December 31, 2023 and 2022 is as follows: ($ in thousands) 2023 2022 Arena SOP LP units $ 2,463 $ 8,734 Arena Special Opportunities Fund, LP units 41,046 44,504 Brewer Lane Ventures Fund II LP units 560 200 Dowling Capital Partners LP units 1,708 1,965 Hudson Ventures Fund 2 LP units 4,669 3,551 JVM Funds LLC units 20,061 22,473 RISCOM 4,121 4,037 Universa Black Swan LP units — 1,325 $ 74,628 $ 86,789 Equity in (loss) income from unconsolidated subsidiaries for the years ended December 31, 2023 and 2022 is summarized as follows: ($ in thousands) 2023 2022 Arena SOP LP units $ (6,271) $ 3,042 Arena Special Opportunities Fund, LP units (2,880) 3,719 Dowling Capital Partners LP units 927 502 Hudson Ventures Fund 2 LP units 170 379 JVM Funds LLC (1,198) (70) RISCOM 884 1,471 Brewer Lane Ventures Fund II LP (78) — Universa Black Swan LP units (988) (3,028) $ (9,434) $ 6,015 The unfunded commitment of equity method investments at December 31, 2023 and 2022 is as follows: ($ in thousands) 2023 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 848 1,796 $ 5,844 $ 6,982 The following table summarizes the Company’s recorded investment in RISCOM compared to its share of underlying equity as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Investment in RISCOM: Underlying equity $ 2,620 $ 2,292 Difference 1,501 1,745 Recorded investment balance $ 4,121 $ 4,037 The following table summarizes the Company’s recorded investment in JVM Funds LLC compared to its share of underlying equity as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Investment in JVM Funds LLC: Underlying equity $ 19,304 $ 21,565 Difference 757 908 Recorded investment balance $ 20,061 $ 22,473 As of December 31, 2023 and 2022, the Company held indirect investments in collateralized loans and loan collateral through SMA1 and SMA2. The carrying value of the SMA1 and SMA2 as of December 31, 2023 and 2022 are as follows: ($ in thousands) 2023 2022 SMA1 $ 30,816 $ 36,426 SMA2 5,209 2,010 Investment in indirect loans and loan collateral $ 36,025 $ 38,436 |
Allowance for Credit Losses (Ta
Allowance for Credit Losses (Tables) | 12 Months Ended |
Dec. 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 on premiums receivable for the year ended ended December 31, 2023. ($ in thousands) Premiums Receivable, Net Allowance for Estimated Uncollectible Premiums Balance at December 31, 2022 $ 139,215 $ 629 Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 — Current period change for estimated uncollectible premiums 748 Write-offs of uncollectible premiums receivable (513) Recoveries of amounts previously written off 100 Balance at December 31, 2023 $ 179,235 $ 964 |
Reinsurance Recoverable, Credit Quality Indicator | The following table sets forth the Company’s reinsurance recoverables net of credit enhancements by A.M. Best as of December 31, 2023: A.M. Best Rating December 31, 2023 A- and above 98.5 % B++ to B+ 0.7 B to B - — Not rated 0.8 |
Reinsurance Recoverable, Allowance for Credit Loss | The following table sets forth the changes in the allowance for estimated uncollectible reinsurance for the year ended ended December 31, 2023: ($ in thousands) Reinsurance Recoverables, Net Allowance for Estimated Uncollectible Reinsurance Balance at December 31, 2022 $ 581,359 $ — Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 2,295 Current period change for estimated uncollectible reinsurance — Write-offs of uncollectible reinsurance recoverables — Balance at December 31, 2023 $ 596,334 $ 2,295 |
Property and Equipment (Tables)
Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | The following table presents the components of property and equipment as of December 31, 2023 and 2022, which are included within other assets on the consolidated balance sheets. ($ in thousands) 2023 2022 Leasehold improvements $ 1,892 $ 2,670 Equipment 5,033 7,230 Software 29,189 25,964 Other — 39 36,114 35,903 Accumulated depreciation (27,044) (27,229) Total $ 9,070 $ 8,674 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Leases [Abstract] | |
Lease, Cost | The following tables provide information regarding the Company’s leases as of and for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Operating lease right-of-use assets $ 4,905 $ 8,214 Operating lease liabilities 5,228 8,616 Operating lease weighted-average remaining lease term 4.55 years 5.00 years Operating lease weighted-average discount rate 3.95 % 3.16 % ($ in thousands) 2023 2022 Operating lease expense $ 2,583 $ 2,414 Short-term lease expense 184 220 Total lease expense $ 2,767 $ 2,634 Operating cash outflows from operating leases $ 2,636 $ 2,382 |
Lessee, Operating Lease, Liability, Maturity | The following table sets forth the future minimum lease payment obligations of the Company’s operating leases at December 31, 2023: ($ in thousands) 2023 2024 $ 1,671 2025 1,204 2026 992 2027 903 2028 661 Thereafter 353 Total future minimum operating lease payments $ 5,784 Less imputed interest (556) Total operating lease liability $ 5,228 |
Subordinated Debt (Tables)
Subordinated Debt (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Subordinated Debt | The following table sets forth the Company’s carrying and fair values of notes payable and subordinated debt as of December 31, 2023 and December 31, 2022: December 31, 2023 December 31, 2022 ($ in thousands) Carrying Fair Carrying Fair Notes payable Term loan $ — $ — $ 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 $ 59,186 $ 59,794 $ 59,137 $ 59,794 Unsecured subordinated notes 19,504 21,378 19,472 18,934 Subordinated debt, net of debt issuance costs $ 78,690 $ 81,172 $ 78,609 $ 78,728 The following table summarizes the Company’s subordinated debt as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Junior subordinated interest debentures, due September 15, 2036, payable quarterly Principal $ 59,794 $ 59,794 Less: Debt issuance costs (608) (657) Unsecured subordinated notes, due May 24, 2039, interest payable quarterly Principal 20,000 20,000 Less: Debt issuance costs (496) (528) Subordinated debt, net of debt issuance costs $ 78,690 $ 78,609 |
Notes Payable (Tables)
Notes Payable (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of Notes Payable | The following table sets forth the interest payments on the Company’s notes payable during the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Interest payments on terminated term loan $ 1,396 $ 1,443 Interest payments on revolving credit facility 2,598 — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The following table sets forth the components of the Company’s income tax expense for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Current income tax expense $ 14,736 $ 120 Deferred tax expense 9,382 10,267 Income tax expense $ 24,118 $ 10,387 |
Schedule of Effective Income Tax Rate Reconciliation | The following table sets forth the differences between income taxes expected at the federal statutory income tax rate of 21% and the reported income tax expense for the years ended December 31, 2023 and 2022. 2023 2022 ($ in thousands) Amount Percentage Amount Percentage Income tax expense at federal statutory rate $ 23,121 21.0 % $ 10,454 21.0 % Tax advantaged investments (295) (0.3) (324) (0.7) Other 1,292 1.2 257 0.6 Total income tax expense $ 24,118 21.9 % $ 10,387 20.9 % |
Schedule of Deferred Tax Assets and Liabilities | The following table sets forth the tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2023 and 2022: ($ in thousands) 2023 2022 Deferred tax assets: Net operating losses $ 10,655 $ 14,966 Losses and loss adjustment expenses 11,581 10,748 Unearned premiums 15,365 11,959 Unrealized losses on fixed maturity securities, available-for-sale 6,113 11,563 Stock options/awards 1,714 1,107 Other 4,237 5,297 Total deferred tax assets 49,665 55,640 Less valuation allowance (586) (586) Total deferred tax assets after valuation allowance 49,079 55,054 Deferred tax liabilities: Deferred policy acquisition costs 11,528 8,209 Other long-term investments 6,460 6,055 Section 481(a) adjustment 3,477 1,405 Unrealized gains on equity securities 3,243 825 Depreciation 1,260 1,481 Other 1,120 891 Total deferred tax liabilities 27,088 18,866 Deferred income taxes $ 21,991 $ 36,188 |
Reserves for Losses and Loss _2
Reserves for Losses and Loss Adjustment Expenses (Tables) | 12 Months Ended |
Dec. 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 for the years ended December 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 516,664 393,939 Prior years — 14,385 Total incurred, net of reinsurance 516,664 408,324 Paid, net of reinsurance, related to: Current period 109,937 105,928 Prior years 253,481 194,836 Total paid 363,418 300,764 Net reserves for losses and LAE, end of period 859,017 705,771 Plus: reinsurance recoverable on unpaid claims, end of period 455,484 435,986 Reserves for losses and LAE, end of period $ 1,314,501 $ 1,141,757 The following table presents the impact of the LPT on the consolidated statements of operations for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Strengthening of reserves subject to the LPT $ — $ (14,385) Reinsurance recoveries under the LPT 1,427 5,813 Pretax net impact of the LPT $ 1,427 $ (8,572) |
Schedule of Short-Duration Insurance Contracts | Short Tail/Monoline Specialty ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance As of December 31, 2023 Years Ended December 31, Reported Claims Accident Year 2019* 2020* 2021* 2022* 2023 IBNR 2019 $ 65,221 $ 50,400 $ 47,600 $ 51,100 $ 53,100 $ 2,832 1,034 2020 68,190 66,690 66,690 66,690 1,877 1,288 2021 102,970 102,970 91,757 5,496 1,556 2022 125,288 125,288 57,026 2,151 2023 205,189 110,310 3,175 Total $ 542,024 Cumulative net paid loss and LAE from the table below (283,284) Net reserves for loss and LAE before 2019 17,964 Total net reserves for loss and LAE $ 276,704 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident Year 2019* 2020* 2021* 2022* 2023 2019 $ 36,013 $ 42,528 $ 43,784 $ 47,330 $ 47,255 2020 32,805 58,329 72,514 72,351 2021 17,554 52,326 66,902 2022 21,404 63,880 2023 32,896 Total $ 283,284 *Supplementary information and unaudited Multi-line Solutions ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance ($ in thousands) As of December 31, 2023 Accident Years Ended December 31, Reported Claims 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 IBNR 2014 $ 100,355 $ 100,355 $ 115,749 $ 116,970 $ 116,970 $ 117,783 $ 118,995 $ 120,731 $ 120,777 $ 118,277 $ 1,016 4,979 2015 103,191 114,266 117,024 117,024 119,216 121,746 122,881 122,902 127,102 910 5,369 2016 64,828 64,448 64,448 64,248 71,306 74,794 74,923 75,923 2,741 4,695 2017 68,650 68,650 67,578 76,231 81,807 82,080 84,580 4,803 5,524 2018 77,647 77,647 77,039 77,039 77,379 73,179 8,983 5,048 2019 110,925 109,925 109,925 114,389 125,337 5,623 6,042 2020 145,846 145,846 139,090 139,090 6,933 5,453 2021 179,174 175,173 175,173 48,993 6,611 2022 232,748 232,748 35,167 8,360 2023 308,497 168,794 7,370 Total $ 1,459,906 Cumulative net paid loss and LAE from the table below (994,414) Net reserves for loss and LAE before 2014 (2,346) Total net reserves for loss and LAE $ 463,146 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 2014 $ 32,530 $ 63,699 $ 81,251 $ 96,639 $ 101,984 $ 104,984 $ 105,756 $ 106,214 $ 104,076 $ 102,214 2015 44,152 72,137 88,833 99,401 108,291 114,098 117,295 118,166 123,268 2016 24,844 44,133 54,957 60,500 62,469 65,498 73,170 74,882 2017 27,088 45,263 56,411 67,553 70,562 72,415 74,770 2018 29,372 45,739 53,491 67,289 73,251 71,042 2019 36,512 63,022 82,296 100,094 113,207 2020 38,504 72,182 88,499 113,637 2021 44,996 84,530 105,853 2022 64,849 140,490 2023 75,051 Total $ 994,414 *Supplementary information and unaudited Exited Lines — all lines in runoff ($ in thousands except number of claims) Incurred Losses and LAE, Net of Reinsurance ($ in thousands) As of December 31, 2023 Years Ended December 31, Reported Claims Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 IBNR 2014 $ 64,186 $ 58,170 $ 62,691 $ 63,995 $ 63,994 $ 69,120 $ 70,186 $ 71,451 $ 72,027 $ 69,027 $ 7,650 4,170 2015 61,920 65,173 68,118 70,912 75,296 80,787 83,432 84,167 87,167 3,985 4,565 2016 95,914 95,509 93,885 96,090 106,368 107,390 108,366 108,366 4,946 4,879 2017 78,246 82,668 84,872 97,578 99,559 101,865 82,865 13,081 4,318 2018 76,956 71,589 82,366 93,812 100,150 105,150 1,571 4,886 2019 91,067 94,550 96,070 110,546 117,302 2,425 5,580 2020 87,809 90,609 90,609 98,512 5,637 4,756 2021 57,392 52,392 36,294 9,014 2,337 2022 35,834 45,111 12,913 215 2023 2,930 8,478 31 Total $ 752,724 Cumulative net paid loss and LAE from the table below (637,997) Net reserves for loss and LAE before 2014 4,440 Total net reserves for loss and LAE $ 119,167 *Supplementary information and unaudited ($ in thousands) Cumulative Paid Losses and LAE, Net of Reinsurance ($ in thousands) Years Ended December 31, Accident 2014* 2015* 2016* 2017* 2018* 2019* 2020* 2021* 2022* 2023 2014 $ 9,700 $ 30,863 $ 42,141 $ 50,785 $ 49,906 $ 52,450 $ 53,290 $ 53,615 $ 55,737 $ 56,594 2015 9,026 41,653 55,610 65,269 73,100 77,981 80,312 81,789 83,706 2016 38,191 59,237 71,852 79,669 83,115 87,393 89,565 92,867 2017 35,962 53,888 53,770 58,625 65,301 70,219 68,747 2018 27,985 62,582 69,695 82,881 93,224 103,432 2019 31,556 66,163 69,602 85,798 98,392 2020 27,476 57,959 66,477 80,744 2021 15,002 20,594 29,317 2022 19,676 22,208 2023 1,990 Total $ 637,997 *Supplementary information and unaudited |
Reconciliation of Claims Development to Liability | The table below presents the reconciliation of the net incurred and paid loss development tables to the balance sheet reserves for losses and loss adjustment expenses at December 31, 2023 and 2022: ($ in thousands) 2023 Net reserves for losses and LAE: Short Tail/Monoline Specialty $ 276,704 Multi-line Solutions 463,146 Exited Lines 119,167 Reserves for losses and LAE, net of reinsurance 859,017 Reinsurance recoverable on unpaid claims: Short Tail/Monoline Specialty 199,044 Multi-line Solutions 252,146 Exited Lines 4,294 Total reinsurance recoverable on unpaid claims 455,484 Reserves for losses and LAE at end of year $ 1,314,501 |
Schedule of Historical Claims Duration | The following table sets forth the historical average annual payout of incurred losses and allocated loss adjustment expenses (claims duration) for short-duration contracts, based on the disaggregated information in the paid loss development tables, net of reinsurance: Average Annual Percentage Payout of Incurred Claims by Age, Net of Reinsurance Years 1* 2* 3* 4* 5* 6* 7* 8* 9* 10* Short Tail/Monoline Specialty 54.0 % 24.7 % 12.1 % 5.0 % 2.2 % 1.0 % 0.5 % 0.2 % 0.2 % 0.1 % Multi-line Solutions 37.7 % 22.6 % 16.6 % 10.6 % 5.3 % 3.9 % 2.0 % 0.4 % 0.4 % 0.5 % Exited Lines 42.8 % 22.0 % 14.2 % 8.4 % 3.2 % 3.2 % 2.7 % 1.0 % 0.8 % 1.7 % *Supplementary information and unaudited |
Commission and Fee Income (Tabl
Commission and Fee Income (Tables) | 12 Months Ended |
Dec. 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 SUA commission revenue $ 2,864 $ 3,224 SUA fee income 2,732 1,597 Other 468 378 Total commission and fee income $ 6,064 $ 5,199 |
Schedule of Contract Asset | The following table sets forth the Company’s opening and closing balances of contract assets from commission and fee income for the years ended December 31, 2023 and 2022: ($ in thousands) Contract Assets Balance at December 31, 2021 $ 1,209 Balance at December 31, 2022 1,292 Balance at December 31, 2023 976 |
Underwriting, Acquisition and_2
Underwriting, Acquisition and Insurance Expenses (Tables) | 12 Months Ended |
Dec. 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 years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Amortization of policy acquisition costs $ 108,514 $ 65,695 Other operating and general expenses 134,930 116,476 Total underwriting, acquisition and insurance expenses $ 243,444 $ 182,171 |
Reinsurance (Tables)
Reinsurance (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Insurance [Abstract] | |
Effects of Reinsurance | The following table sets forth the effects of reinsurance on premiums written and earned for years ended December 31, 2023 and 2022: 2023 2022 ($ in thousands) Written Earned Written Earned Direct premiums $ 1,241,180 $ 1,155,835 $ 1,012,239 $ 951,121 Assumed premiums 218,649 193,971 131,713 113,610 Ceded premiums (549,138) (520,663) (468,409) (448,737) Net premiums $ 910,691 $ 829,143 $ 675,543 $ 615,994 Ceded losses and LAE incurred $ 337,011 $ 311,257 |
Ceded Credit Risk | The following table sets forth the components of reinsurance recoverables and ceded unearned premium at December 31, 2023 and 2022: ($ in thousands) 2023 2022 Ceded unpaid losses and LAE $ 455,484 $ 435,986 Ceded paid losses and LAE 122,287 107,228 Loss portfolio transfer 20,858 38,145 Allowance for credit losses (2,295) — Reinsurance recoverables $ 596,334 $ 581,359 Ceded unearned premium $ 186,121 $ 157,645 |
Schedule of Liability for Unpaid Claims and Claims Adjustment Expense | The following table sets forth the reconciliation of unpaid losses and loss adjustment expenses for the years ended December 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 516,664 393,939 Prior years — 14,385 Total incurred, net of reinsurance 516,664 408,324 Paid, net of reinsurance, related to: Current period 109,937 105,928 Prior years 253,481 194,836 Total paid 363,418 300,764 Net reserves for losses and LAE, end of period 859,017 705,771 Plus: reinsurance recoverable on unpaid claims, end of period 455,484 435,986 Reserves for losses and LAE, end of period $ 1,314,501 $ 1,141,757 The following table presents the impact of the LPT on the consolidated statements of operations for the years ended December 31, 2023 and 2022: ($ in thousands) 2023 2022 Strengthening of reserves subject to the LPT $ — $ (14,385) Reinsurance recoveries under the LPT 1,427 5,813 Pretax net impact of the LPT $ 1,427 $ (8,572) |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 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 years ended December 31, 2023 and 2022: Award Requisite Authorized Target Year ended December 31, 2023 Market condition awards 0% — 150% 3 years 37,622 Performance condition awards 0% — 150% 3 years 95,456 Service condition awards N/A 1 to 4 years 968,778 Stock options N/A 3 to 4 years 759,990 1,861,846 Year ended December 31, 2022 Market condition awards 0% — 150% 3 years 28,495 Performance condition awards 0% — 150% 3 years 26,210 Restricted stock unit awards N/A 1 to 3 years 144,137 198,842 The following table sets forth option activity for the year ended December 31, 2023 : Weighted-Average Stock Outstanding at January 1, 2023 — Granted $ 15.00 759,990 Outstanding at December 31, 2023 759,990 |
Schedule of Nonvested Share Activity | The following table sets forth the Company’s restricted stock and restricted stock units activity for the years ended December 31, 2023 and 2022: Weighted-Average Stock and Stock Units Non-vested at January 1, 2023 $ 12.55 419,896 Granted 16.07 1,101,856 Vested 13.39 (40,645) Forfeited 15.29 (35,658) Non-vested at December 31, 2023 $ 15.13 1,445,449 Non-vested at January 1, 2022 $ 13.23 375,643 Granted 14.17 198,842 Vested 15.16 (144,042) Forfeited 12.51 (10,547) Non-vested at December 31, 2022 $ 12.55 419,896 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the compilation of basic and diluted net earnings per share for the years ended December 31, 2023 and 2022: ($ in thousands, except for share and per share amounts) 2023 2022 Numerator Net income $ 85,984 $ 39,396 Less: Undistributed income allocated to participating securities (1,677) (18,879) Net income attributable to common shareholders (numerator for basic earnings per share) 84,307 20,517 Add back: Undistributed income allocated to participating securities 1,677 18,879 Net income (numerator for diluted earnings per share under the two-class method) $ 85,984 $ 39,396 Denominator Basic weighted-average common shares 36,031,907 16,568,393 Dilutive effect of preferred shares 716,708 15,245,533 Dilutive effect of stock notes 696,110 519,080 Dilutive effect of awarded stock units 736,837 320,188 Dilutive effect of awarded options 135,972 — Diluted weighted-average common share equivalents 38,317,534 32,653,194 Basic earnings per share $ 2.34 $ 1.24 Diluted earnings per share $ 2.24 $ 1.21 |
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share | The following table presents anti-dilutive instruments that were excluded from the calculation of diluted weighted-average common share equivalents during the years ended December 31, 2023 and 2022: 2023 2022 Stock notes — 60,576 Awarded stock units 3,931 — Awarded options 914 — 2023 2022 Common shares 920,864 22,919 Preferred shares, if converted — 1,059,602 Total 920,864 1,082,521 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | Net earned premium and gross written commissions related to these agreements for the years ended December 31, 2023 and 2022 is summarized as follows: ($ in thousands) 2023 2022 Net earned premium $ 99,736 $ 91,051 Gross written commissions 24,177 23,472 |
Statutory Accounting Principl_2
Statutory Accounting Principles and Regulatory Matters (Tables) | 12 Months Ended |
Dec. 31, 2023 | |
Insurance [Abstract] | |
Schedule of Compliance with Regulatory Capital Requirements under Banking Regulations | The following table sets forth statutory net income and statutory capital and surplus for the Company for the years ended and as of December 31, 2023 and 2022: ($ in thousands) 2023 2022 Statutory net income $ 46,884 $ 10,860 Statutory capital and surplus 602,916 408,167 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 USD ($) segment | Dec. 31, 2022 USD ($) | Jan. 01, 2023 USD ($) | |
Concentration Risk [Line Items] | |||
Number of operating segments | segment | 1 | ||
Reinsurance collateral from reinsurers | $ 257,500 | $ 253,900 | |
Allowance for uncollectable reinsurance | 2,295 | 0 | |
Retained earnings (accumulated deficit) | (21,708) | (105,417) | |
Allowance for premiums receivable | $ 964 | 629 | |
Period of adoption, adjustment | |||
Concentration Risk [Line Items] | |||
Allowance for uncollectable reinsurance | $ 2,295 | ||
Period of adoption, adjustment | Pro forma | |||
Concentration Risk [Line Items] | |||
Allowance for uncollectable reinsurance | $ 2,300 | ||
Retained earnings (accumulated deficit) | $ (2,300) | ||
Minimum | |||
Concentration Risk [Line Items] | |||
Property, plant and equipment, useful life | 3 years | ||
Maximum | |||
Concentration Risk [Line Items] | |||
Property, plant and equipment, useful life | 7 years | ||
AM Best, A+ Rating | Everest Reinsurance Co | Reinsurance recoverable including reinsurance premium paid | Reinsurer concentration risk | |||
Concentration Risk [Line Items] | |||
Concentration risk, percentage | 20.40% | 28.20% |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Schedule of Goodwill (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Goodwill [Roll Forward] | |||
Goodwill, gross balance | $ 112,441 | $ 112,441 | |
Accumulated impairment | (46,707) | (46,707) | |
Goodwill, net balance | $ 65,734 | 65,734 | |
Accident and Health | |||
Goodwill [Roll Forward] | |||
Goodwill, gross balance | 91,577 | 91,577 | |
Accumulated impairment | (44,821) | (44,821) | |
Goodwill, net balance | 46,756 | 46,756 | |
Surety | |||
Goodwill [Roll Forward] | |||
Goodwill, gross balance | 6,781 | 6,781 | |
Accumulated impairment | 0 | 0 | |
Goodwill, net balance | 6,781 | 6,781 | |
Other | |||
Goodwill [Roll Forward] | |||
Goodwill, gross balance | 3,879 | 3,879 | |
Accumulated impairment | (1,886) | (1,886) | |
Goodwill, net balance | 1,993 | 1,993 | |
Industry Solutions | |||
Goodwill [Roll Forward] | |||
Goodwill, gross balance | 10,204 | 10,204 | |
Accumulated impairment | 0 | $ 0 | |
Goodwill, net balance | $ 10,204 | $ 10,204 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Schedule of Intangible Assets and Goodwill (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Finite-Lived | |||
Accumulated amortization | $ (16,557) | $ (15,091) | |
Amortization | $ (1,485) | (1,466) | |
Total | |||
Gross, beginning balance | 40,693 | 40,693 | |
Accumulated amortization | (16,557) | (15,091) | |
Additions | 50 | ||
Amortization | (1,485) | (1,466) | |
Gross intangible assets, ending balance | 22,701 | 24,136 | |
Trademarks | |||
Indefinite-Lived | |||
Beginning balance | 999 | 999 | |
Additions | 0 | ||
Ending balance | 999 | 999 | |
Licenses | |||
Indefinite-Lived | |||
Beginning balance | 14,019 | 14,019 | |
Additions | 0 | ||
Ending balance | 14,019 | 14,019 | |
Agent Relationships | |||
Finite-Lived | |||
Gross, beginning balance | 24,558 | 24,558 | |
Accumulated amortization | (15,664) | (14,421) | |
Additions | 50 | ||
Amortization | (1,261) | (1,243) | |
Net, ending balance | 7,683 | 8,894 | |
Total | |||
Accumulated amortization | (15,664) | (14,421) | |
Amortization | (1,261) | (1,243) | |
Non-competes | |||
Finite-Lived | |||
Gross, beginning balance | 1,117 | 1,117 | |
Accumulated amortization | (893) | (670) | |
Additions | 0 | ||
Amortization | (224) | (223) | |
Net, ending balance | 0 | 224 | |
Total | |||
Accumulated amortization | (893) | $ (670) | |
Amortization | $ (224) | $ (223) |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Useful life | 15 years | |
Amortization of intangible assets | $ 1,485 | $ 1,466 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | |
2024 | $ 1,099 |
2025 | 998 |
2026 | 553 |
2027 | 553 |
2028 | $ 553 |
Investments - Debt Securities,
Investments - Debt Securities, Trading, and Equity Securities, FV-NI (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | $ 1,047,713 | $ 662,616 |
Gross Unrealized Gains | 12,491 | 1,151 |
Gross Unrealized Losses | (42,553) | (56,195) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 1,017,651 | 607,572 |
Total fixed maturity securities, held-to-maturity | ||
Gross Amortized Cost | 43,315 | 52,467 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (1,969) | (5,696) |
Allowance for Credit Losses | (329) | |
Total fixed maturity securities, held-to-maturity | 41,017 | 46,771 |
U.S. government securities | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 44,685 | 50,416 |
Gross Unrealized Gains | 202 | 1 |
Gross Unrealized Losses | (721) | (1,876) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 44,166 | 48,541 |
Corporate securities and miscellaneous | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 392,773 | 255,116 |
Gross Unrealized Gains | 6,408 | 767 |
Gross Unrealized Losses | (15,761) | (20,754) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 383,420 | 235,129 |
Municipal securities | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 98,266 | 65,836 |
Gross Unrealized Gains | 655 | 24 |
Gross Unrealized Losses | (6,143) | (8,133) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 92,778 | 57,727 |
Residential mortgage-backed securities | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 292,568 | 134,844 |
Gross Unrealized Gains | 3,556 | 218 |
Gross Unrealized Losses | (14,498) | (15,206) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 281,626 | 119,856 |
Commercial mortgage-backed securities | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 31,411 | 40,129 |
Gross Unrealized Gains | 449 | 50 |
Gross Unrealized Losses | (1,926) | (3,684) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 29,934 | 36,495 |
Other asset-backed securities | ||
Total fixed maturity securities, available-for-sale | ||
Gross Amortized Cost | 188,010 | 116,275 |
Gross Unrealized Gains | 1,221 | 91 |
Gross Unrealized Losses | (3,504) | (6,542) |
Allowance for Credit Losses | 0 | |
Total fixed maturity securities, available-for-sale | 185,727 | 109,824 |
Total fixed maturity securities, held-to-maturity | ||
Gross Amortized Cost | 43,315 | 52,467 |
Gross Unrealized Gains | 0 | 0 |
Gross Unrealized Losses | (1,969) | (5,696) |
Allowance for Credit Losses | (329) | |
Total fixed maturity securities, held-to-maturity | $ 41,017 | $ 46,771 |
Investments - Investments Class
Investments - Investments Classified by Contractual Maturity Date (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Amortized Cost | ||
Due in less than one year | $ 30,918 | |
Due after one year through five years | 289,151 | |
Due after five years through ten years | 162,380 | |
Due after ten years | 53,275 | |
Gross Amortized Cost | 1,047,713 | $ 662,616 |
Fair Value | ||
Due in less than one year | 30,518 | |
Due after one year through five years | 280,212 | |
Due after five years through ten years | 159,863 | |
Due after ten years | 49,771 | |
Fair value total | 1,017,651 | 607,572 |
Mortgage-backed securities | ||
Amortized Cost | ||
Without single maturity date | 323,979 | |
Fair Value | ||
Without single maturity date | 311,560 | |
Other asset-backed securities | ||
Amortized Cost | ||
Without single maturity date | 188,010 | |
Fair Value | ||
Without single maturity date | 185,727 | |
Fair value total | $ 185,727 | $ 109,824 |
Investments - Schedule of Unrea
Investments - Schedule of Unrealized Loss on Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Available for sale, fair value | ||
Less than 12 Months | $ 121,362 | $ 408,939 |
12 Months or More | 441,858 | 143,730 |
Total | 563,220 | 552,669 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (1,667) | (32,893) |
12 Months or More | (40,886) | (23,302) |
Total | (42,553) | (56,195) |
Held-to-maturity, fair value | ||
Less than 12 Months | 0 | 46,771 |
12 Months or More | 41,017 | 0 |
Total | 41,017 | 46,771 |
Held-to-maturity, gross unrealized losses | ||
Less than 12 Months | 0 | (5,696) |
12 Months or More | (1,969) | 0 |
Total | (1,969) | (5,696) |
Available-for-sale and held-to-maturity, fair value | ||
Less than 12 Months | 121,362 | 455,710 |
12 Months or More | 482,875 | 143,730 |
Total | 604,237 | 599,440 |
Available-for-sale and held-to-maturity, gross unrealized losses | ||
Less than 12 Months | (1,667) | (38,589) |
12 Months or More | (42,855) | (23,302) |
Total | (44,522) | (61,891) |
U.S. government securities | ||
Available for sale, fair value | ||
Less than 12 Months | 7,342 | 28,966 |
12 Months or More | 25,604 | 18,577 |
Total | 32,946 | 47,543 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (25) | (603) |
12 Months or More | (696) | (1,273) |
Total | (721) | (1,876) |
Corporate securities and miscellaneous | ||
Available for sale, fair value | ||
Less than 12 Months | 26,742 | 171,506 |
12 Months or More | 174,947 | 34,283 |
Total | 201,689 | 205,789 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (570) | (16,063) |
12 Months or More | (15,191) | (4,691) |
Total | (15,761) | (20,754) |
Municipal securities | ||
Available for sale, fair value | ||
Less than 12 Months | 16,815 | 51,701 |
12 Months or More | 47,269 | 3,689 |
Total | 64,084 | 55,390 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (290) | (7,236) |
12 Months or More | (5,853) | (897) |
Total | (6,143) | (8,133) |
Residential mortgage-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 37,634 | 56,246 |
12 Months or More | 103,495 | 52,778 |
Total | 141,129 | 109,024 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (602) | (4,152) |
12 Months or More | (13,896) | (11,054) |
Total | (14,498) | (15,206) |
Commercial mortgage-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 4,942 | 25,836 |
12 Months or More | 15,290 | 8,583 |
Total | 20,232 | 34,419 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (74) | (1,488) |
12 Months or More | (1,852) | (2,196) |
Total | (1,926) | (3,684) |
Other asset-backed securities | ||
Available for sale, fair value | ||
Less than 12 Months | 27,887 | 74,684 |
12 Months or More | 75,253 | 25,820 |
Total | 103,140 | 100,504 |
Available for sale, gross unrealized losses | ||
Less than 12 Months | (106) | (3,351) |
12 Months or More | (3,398) | (3,191) |
Total | (3,504) | (6,542) |
Held-to-maturity, fair value | ||
Less than 12 Months | 0 | 46,771 |
12 Months or More | 41,017 | 0 |
Total | 41,017 | 46,771 |
Held-to-maturity, gross unrealized losses | ||
Less than 12 Months | 0 | (5,696) |
12 Months or More | (1,969) | 0 |
Total | $ (1,969) | $ (5,696) |
Investments - Narrative (Detail
Investments - Narrative (Details) $ in Millions | Dec. 31, 2023 USD ($) lot | Dec. 31, 2022 USD ($) |
Investments, Debt and Equity Securities [Abstract] | ||
Unrealized loss position aged over 12 months, number of positions | lot | 584 | |
Cash and securities segregated under federal and other regulations | $ | $ 62.3 | $ 60.2 |
Investments - Net Investment Lo
Investments - Net Investment Losses (Gains) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Gross realized gains | ||
Fixed maturity securities, available-for-sale | $ 1,042 | $ 313 |
Equity securities | 6,035 | 3,865 |
Other | 2 | 36 |
Total | 7,079 | 4,214 |
Gross realized losses | ||
Fixed maturity securities, available-for-sale | (1,879) | (958) |
Equity securities | (5,256) | (3,827) |
Other | (2) | (76) |
Total | (7,137) | (4,861) |
Net unrealized gains (losses) on investments | ||
Equity securities | 11,516 | (15,058) |
Mortgage loans | (386) | 0 |
Net investment gains (losses) | $ 11,072 | $ (15,705) |
Investments - Proceeds from Sal
Investments - Proceeds from Sales (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | ||
Fixed maturity securities, available-for-sale | $ 26,626 | $ 13,964 |
Equity securities | $ 40,201 | $ 37,177 |
Investments - Net Investment In
Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Net Investment Income [Line Items] | ||
Investment income | $ 45,879 | $ 44,484 |
Investment expenses | (5,557) | (7,553) |
Net investment income | 40,322 | 36,931 |
Fixed maturity securities, available-for-sale | ||
Net Investment Income [Line Items] | ||
Investment income | 34,703 | 18,481 |
Fixed maturity securities, held-to-maturity | ||
Net Investment Income [Line Items] | ||
Investment income | 4,163 | 5,375 |
Equity securities: | ||
Net Investment Income [Line Items] | ||
Investment income | 3,418 | 3,579 |
Equity method investments | ||
Net Investment Income [Line Items] | ||
Investment income | (9,434) | 6,015 |
Mortgage loans | ||
Net Investment Income [Line Items] | ||
Investment income | 5,474 | 4,767 |
Indirect loans | ||
Net Investment Income [Line Items] | ||
Investment income | (4,155) | 4,846 |
Short-term investments | ||
Net Investment Income [Line Items] | ||
Investment income | 11,392 | 1,498 |
Other | ||
Net Investment Income [Line Items] | ||
Investment income | $ 318 | $ (77) |
Investments - Schedule of Accum
Investments - Schedule of Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Investments, Debt and Equity Securities [Abstract] | ||
Fixed maturity securities | $ 25,952 | $ (60,918) |
Deferred income taxes | (5,420) | 12,793 |
Total other comprehensive income (loss) | $ 20,532 | $ (48,125) |
Fair Value Measurements - Fair
Fair Value Measurements - Fair Value Measurement Inputs and Valuation Techniques (Details) - Fair Value, Inputs, Level 3 - Measurement Input, Incremental Cost of Capital | Dec. 31, 2023 |
Maximum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 9.50% |
Minimum | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 3.25% |
Weighted average | |
Fair Value Measurement Inputs and Valuation Techniques [Line Items] | |
Loans receivable | 7.05% |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | $ 1,017,651 | $ 607,572 |
Total fixed maturity securities, held-to-maturity | 41,017 | 46,771 |
Equity securities, at fair value | 118,249 | 120,169 |
Mortgage loans | 50,070 | 52,842 |
Short-term investments | 270,226 | 121,158 |
Total investments | 1,497,213 | 948,512 |
U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,166 | 48,541 |
Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 383,420 | 235,129 |
Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 92,778 | 57,727 |
Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 281,626 | 119,856 |
Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 29,934 | 36,495 |
Other asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 185,727 | 109,824 |
Total fixed maturity securities, held-to-maturity | 41,017 | 46,771 |
Total common stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 67,425 | 55,996 |
Total common stocks | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,313 | 1,948 |
Total common stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 14,015 | 12,036 |
Total common stocks | Industry Solutions | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,187 | 3,241 |
Total common stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 24,267 | 22,636 |
Total common stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 12,170 | 9,452 |
Total common stocks | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,192 | 2,284 |
Total common stocks | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,782 | 2,820 |
Total common stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,499 | 1,579 |
Total preferred stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 7,358 | 8,771 |
Total preferred stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 433 | 117 |
Total preferred stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,061 | 7,085 |
Total preferred stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,052 | 1,020 |
Total preferred stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 812 | 549 |
Total mutual funds | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 43,466 | 55,402 |
Total mutual funds | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,405 | 5,068 |
Total mutual funds | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 37,546 | 49,773 |
Total mutual funds | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 515 | 561 |
Fair Value, Inputs, Level 1 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,166 | 48,541 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Equity securities, at fair value | 110,891 | 111,398 |
Mortgage loans | 0 | 0 |
Short-term investments | 270,226 | 121,158 |
Total investments | 425,283 | 281,097 |
Fair Value, Inputs, Level 1 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 44,166 | 48,541 |
Fair Value, Inputs, Level 1 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 1 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 1 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 1 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 1 | Other 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 |
Fair Value, Inputs, Level 1 | Total common stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 67,425 | 55,996 |
Fair Value, Inputs, Level 1 | Total common stocks | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,313 | 1,948 |
Fair Value, Inputs, Level 1 | Total common stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 14,015 | 12,036 |
Fair Value, Inputs, Level 1 | Total common stocks | Industry Solutions | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,187 | 3,241 |
Fair Value, Inputs, Level 1 | Total common stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 24,267 | 22,636 |
Fair Value, Inputs, Level 1 | Total common stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 12,170 | 9,452 |
Fair Value, Inputs, Level 1 | Total common stocks | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,192 | 2,284 |
Fair Value, Inputs, Level 1 | Total common stocks | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 3,782 | 2,820 |
Fair Value, Inputs, Level 1 | Total common stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 2,499 | 1,579 |
Fair Value, Inputs, Level 1 | Total preferred stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 1 | Total preferred stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 1 | Total preferred stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 1 | Total preferred stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 1 | Total preferred stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 1 | Total mutual funds | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 43,466 | 55,402 |
Fair Value, Inputs, Level 1 | Total mutual funds | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,405 | 5,068 |
Fair Value, Inputs, Level 1 | Total mutual funds | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 37,546 | 49,773 |
Fair Value, Inputs, Level 1 | Total mutual funds | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 515 | 561 |
Fair Value, Inputs, Level 2 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 973,485 | 559,031 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Equity securities, at fair value | 7,358 | 8,771 |
Mortgage loans | 0 | 0 |
Short-term investments | 0 | 0 |
Total investments | 980,843 | 567,802 |
Fair Value, Inputs, Level 2 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 2 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 383,420 | 235,129 |
Fair Value, Inputs, Level 2 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 92,778 | 57,727 |
Fair Value, Inputs, Level 2 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 281,626 | 119,856 |
Fair Value, Inputs, Level 2 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 29,934 | 36,495 |
Fair Value, Inputs, Level 2 | Other asset-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 185,727 | 109,824 |
Total fixed maturity securities, held-to-maturity | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Industry Solutions | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total common stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total preferred stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 7,358 | 8,771 |
Fair Value, Inputs, Level 2 | Total preferred stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 433 | 117 |
Fair Value, Inputs, Level 2 | Total preferred stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 5,061 | 7,085 |
Fair Value, Inputs, Level 2 | Total preferred stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 1,052 | 1,020 |
Fair Value, Inputs, Level 2 | Total preferred stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 812 | 549 |
Fair Value, Inputs, Level 2 | Total mutual funds | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total mutual funds | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total mutual funds | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 2 | Total mutual funds | Commodity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Total fixed maturity securities, held-to-maturity | 41,017 | 46,771 |
Equity securities, at fair value | 0 | 0 |
Mortgage loans | 50,070 | 52,842 |
Short-term investments | 0 | 0 |
Total investments | 91,087 | 99,613 |
Fair Value, Inputs, Level 3 | U.S. government securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 3 | Corporate securities and miscellaneous | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 3 | Municipal securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 3 | Residential mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 3 | Commercial mortgage-backed securities | ||
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | 0 | 0 |
Fair Value, Inputs, Level 3 | Other 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 | 41,017 | 46,771 |
Fair Value, Inputs, Level 3 | Total common stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Consumer discretionary | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Industry Solutions | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Information technology | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Materials | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total common stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total preferred stocks | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total preferred stocks | Consumer staples | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total preferred stocks | Finance | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total preferred stocks | Industrial | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total preferred stocks | Other | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total mutual funds | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total mutual funds | Fixed income | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total mutual funds | Equity | ||
Fixed maturity securities, available-for-sale: | ||
Equity securities, at fair value | 0 | 0 |
Fair Value, Inputs, Level 3 | Total 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 | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ 52,842 |
Total losses for the period recognized in net investment gains (losses) | (385) |
Issuances | 27,642 |
Settlements | (30,029) |
Ending balance | 50,070 |
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 | $ (426) |
Fair Value Measurements - Fai_3
Fair Value Measurements - Fair Value, by Balance Sheet Grouping (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Fixed maturity securities, available-for-sale: | ||
Total fixed maturity securities, available-for-sale | $ 1,017,651 | $ 607,572 |
Total fixed maturity securities, held-to-maturity | 41,017 | 46,771 |
Equity securities, at fair value | 118,249 | 120,169 |
Short-term investments | $ 270,226 | $ 121,158 |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Subordinated Debt (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Term loan | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 0 | $ 50,000 |
Term loan | 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 | 59,186 | 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 | 19,504 | 19,472 |
Unsecured subordinated notes | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 21,378 | 18,934 |
Subordinated debt, net of debt issuance costs | Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 78,690 | 78,609 |
Subordinated debt, net of debt issuance costs | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 81,172 | $ 78,728 |
Mortgage Loans - Narrative (Det
Mortgage Loans - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Mortgage loans in foreclosure | $ 7.1 | $ 6.4 |
Mortgage loans not producing income | $ 6.8 | |
Minimum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans held-for-investment, term | 1 year | |
Percentage of property appraisal value | 61% | |
Maximum | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Loans held-for-investment, term | 3 years | |
Percentage of property appraisal value | 90% |
Mortgage Loans - Portfolios (De
Mortgage Loans - Portfolios (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | $ 50,070 | $ 51,859 |
Total gross investment income | 5,474 | 4,767 |
Retail | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 16,072 | 16,516 |
Total gross investment income | 1,853 | 1,255 |
Commercial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 14,469 | 15,309 |
Total gross investment income | 2,340 | 1,242 |
Industrial | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 6,785 | 6,329 |
Total gross investment income | 0 | 565 |
Multi-family | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 0 | 5,593 |
Total gross investment income | 44 | 909 |
Office | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 0 | 3,197 |
Total gross investment income | 203 | 385 |
Hospitality | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total mortgage loans | 12,744 | 4,915 |
Total gross investment income | $ 1,034 | $ 411 |
Other Long-Term Investments - N
Other Long-Term Investments - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2018 | |
Brewer Lane Ventures Fund II LP units | |||
Schedule of Equity Method Investments [Line Items] | |||
Payment to acquire equity method investment | $ 0.4 | $ 0.2 | |
Hudson Ventures Fund 2 LP units | |||
Schedule of Equity Method Investments [Line Items] | |||
Payment to acquire equity method investment | $ 0.9 | $ 1.3 | |
RISCOM | |||
Schedule of Equity Method Investments [Line Items] | |||
Useful life | 15 years | ||
JVM Funds LLC units | |||
Schedule of Equity Method Investments [Line Items] | |||
Useful life | 7 years | ||
Captex Bancshares | |||
Schedule of Equity Method Investments [Line Items] | |||
Payment to acquire equity method investment | $ 2 |
Other Long-Term Investments - C
Other Long-Term Investments - Carrying Value of Equity Method Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 74,628 | $ 86,789 |
Arena SOP LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 2,463 | 8,734 |
Arena Special Opportunities Fund, LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 41,046 | 44,504 |
Brewer Lane Ventures Fund II LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 560 | 200 |
Dowling Capital Partners LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 1,708 | 1,965 |
Hudson Ventures Fund 2 LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 4,669 | 3,551 |
JVM Funds LLC units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 20,061 | 22,473 |
RISCOM | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | 4,121 | 4,037 |
Universa Black Swan LP units | ||
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 0 | $ 1,325 |
Other Long-Term Investments -_2
Other Long-Term Investments - Net Investment Income (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | $ 40,322 | $ 36,931 |
Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (9,434) | 6,015 |
Arena SOP LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (6,271) | 3,042 |
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 | (2,880) | 3,719 |
Dowling Capital Partners LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | 927 | 502 |
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 | 170 | 379 |
JVM Funds LLC units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (1,198) | (70) |
RISCOM | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | 884 | 1,471 |
Brewer Lane Ventures Fund II LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | (78) | 0 |
Universa Black Swan LP units | Equity Method Investment, Nonconsolidated Investee or Group of Investees | ||
Schedule of Equity Method Investments [Line Items] | ||
Net investment income | $ (988) | $ (3,028) |
Other Long-Term Investments - U
Other Long-Term Investments - Unfunded Commitment of Equity Method Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Unfunded commitment | $ 5,844 | $ 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 | $ 848 | $ 1,796 |
Other Long-Term Investments - I
Other Long-Term Investments - Investment in RISCOM (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity [Abstract] | ||
Recorded investment balance | $ 74,628 | $ 86,789 |
RISCOM | ||
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity [Abstract] | ||
Underlying equity | 2,620 | 2,292 |
Difference | 1,501 | 1,745 |
Recorded investment balance | $ 4,121 | $ 4,037 |
Other Long-Term Investments -_3
Other Long-Term Investments - Investment in JVN Funds (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Recorded investment balance | $ 74,628 | $ 86,789 |
JVM Funds LLC units | ||
Schedule of Equity Method Investments [Line Items] | ||
Underlying equity | 19,304 | 21,565 |
Difference | 757 | 908 |
Recorded investment balance | $ 20,061 | $ 22,473 |
Other Long-Term Investments - S
Other Long-Term Investments - Schedule of Indirect Investments (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | $ 74,628 | $ 86,789 |
Investment in indirect loans and loan collateral | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | 36,025 | 38,436 |
SMA1 | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | 30,816 | 36,426 |
SMA2 | ||
Schedule of Equity Method Investments [Line Items] | ||
Equity Method Investments | $ 5,209 | $ 2,010 |
Allowance for Credit Losses - P
Allowance for Credit Losses - Premium Receivable (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Premium Receivable, Allowance for Credit Loss [Roll Forward] | |
Premiums Receivable, Net, beginning balance | $ 139,215 |
Allowance for Estimated Uncollectible Premiums, beginning balance | 629 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 | 964 |
Current period change for estimated uncollectible premiums | 748 |
Write-offs of uncollectible premiums receivable | (513) |
Recoveries of amounts previously written off | 100 |
Premiums Receivable, Net, ending balance | 179,235 |
Allowance for Estimated Uncollectible Premiums, ending balance | 964 |
Period of adoption, adjustment | |
Premium Receivable, Allowance for Credit Loss [Roll Forward] | |
Allowance for Estimated Uncollectible Premiums, 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 | 12 Months Ended |
Dec. 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 | 0.70% |
B to B - | |
Ceded Credit Risk [Line Items] | |
Concentration risk, percentage | 0% |
Not rated | |
Ceded Credit Risk [Line Items] | |
Concentration risk, percentage | 0.80% |
Allowance for Credit Losses - R
Allowance for Credit Losses - Reinsurance Recoverable (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2023 USD ($) | |
Reinsurance Recoverable, Allowance for Credit Loss [Roll Forward] | |
Reinsurance Recoverables, Net, beginning balance | $ 581,359 |
Allowance for Estimated Uncollectible Reinsurance, 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 |
Write-offs of uncollectible reinsurance recoverables | 0 |
Reinsurance Recoverables, Net, ending balance | 596,334 |
Allowance for Estimated Uncollectible Reinsurance, ending balance | 2,295 |
Period of adoption, adjustment | |
Reinsurance Recoverable, Allowance for Credit Loss [Roll Forward] | |
Allowance for Estimated Uncollectible Reinsurance, beginning balance | $ 2,295 |
Cumulative effect of adoption of ASU 2016-13 at January 1, 2023 |
Property and Equipment - Proper
Property and Equipment - Property, Plant and Equipment (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Property, Plant and Equipment [Line Items] | ||
Property, equipment and other, gross | $ 36,114 | $ 35,903 |
Accumulated depreciation | (27,044) | (27,229) |
Total | 9,070 | 8,674 |
Leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment and other, gross | 1,892 | 2,670 |
Equipment | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment and other, gross | 5,033 | 7,230 |
Software | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment and other, gross | 29,189 | 25,964 |
Other | ||
Property, Plant and Equipment [Line Items] | ||
Property, equipment and other, gross | $ 0 | $ 39 |
Property and Equipment - Narrat
Property and Equipment - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | ||
Depreciation | $ 3.2 | $ 3.6 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Lessee, Lease, Description [Line Items] | ||
Operating lease, expense | $ 2.8 | $ 2.6 |
Minimum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term | 1 year | |
Maximum | ||
Lessee, Lease, Description [Line Items] | ||
Remaining lease term | 6 years |
Leases - Lease, Cost (Details)
Leases - Lease, Cost (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 4,905 | $ 8,214 |
Operating lease liabilities | $ 5,228 | $ 8,616 |
Operating lease weighted-average remaining lease term | 4 years 6 months 18 days | 5 years |
Operating lease weighted-average discount rate | 3.95% | 3.16% |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other assets | Other assets |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Accounts payable and accrued liabilities | Accounts payable and accrued liabilities |
Leases - Cash Flow Information
Leases - Cash Flow Information (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Leases [Abstract] | ||
Operating lease expense | $ 2,583 | $ 2,414 |
Short-term lease expense | 184 | 220 |
Total lease expense | 2,767 | 2,634 |
Operating cash outflows from operating leases | $ 2,636 | $ 2,382 |
Leases - Lessee, Operating Leas
Leases - Lessee, Operating Lease, Liability, Maturity (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Lessee, Operating Lease, Liability, to be Paid [Abstract] | ||
2024 | $ 1,671 | |
2025 | 1,204 | |
2026 | 992 | |
2027 | 903 | |
2028 | 661 | |
Thereafter | 353 | |
Total future minimum operating lease payments | 5,784 | |
Less imputed interest | (556) | |
Operating lease liabilities | $ 5,228 | $ 8,616 |
Subordinated Debt - Summary of
Subordinated Debt - Summary of Subordinated Debt (Details) - Subordinated Debt - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Debt Instrument [Line Items] | ||
Subordinated debt, net of debt issuance costs | $ 78,690 | $ 78,609 |
Junior Subordinated Notes Due 2036 | ||
Debt Instrument [Line Items] | ||
Principal | 59,794 | 59,794 |
Less: Debt issuance costs | (608) | (657) |
Subordinate Debt Due 2039 | ||
Debt Instrument [Line Items] | ||
Principal | 20,000 | 20,000 |
Less: Debt issuance costs | $ (496) | $ (528) |
Subordinated Debt - Narrative (
Subordinated Debt - Narrative (Details) - Subordinated Debt - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2023 | Dec. 31, 2022 | May 31, 2019 | Aug. 02, 2006 | |
Subordinate Debt Due 2039 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 20,000 | |||
Debt term | 8 years | |||
Less: Debt issuance costs | $ 496 | $ 528 | ||
Subordinate Debt Due 2039 | Debt Interest Rate, First 8 Years | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 7.25% | |||
Debt term | 8 years | |||
Subordinate Debt Due 2039 | Debt Interest Rate, After Year 8 | ||||
Debt Instrument [Line Items] | ||||
Stated interest rate | 8.25% | |||
Junior Subordinated Notes Due 2036, Capital Securities | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 58,000 | |||
Junior Subordinated Notes Due 2036, Common Stock | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 1,800 | |||
Junior Subordinated Notes Due 2036 | ||||
Debt Instrument [Line Items] | ||||
Face amount | $ 59,800 | |||
Stated interest rate | 5.59% | 4.77% | ||
Less: Debt issuance costs | $ 608 | $ 657 | ||
Junior Subordinated Notes Due 2036 | London Interbank Offered Rate (LIBOR) | ||||
Debt Instrument [Line Items] | ||||
Basis spread on variable rate | 3.40% |
Notes_Payable - Narrative (Deta
Notes Payable - Narrative (Details) - Revolving credit facility - Line of Credit - USD ($) | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2023 | |
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 | ||
Unused capacity, commitment fee percentage | 0.25% | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 30,000,000 | ||
Secured Overnight Financing Rate (SOFR) | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.60% | ||
Debt instrument, variable rate | 5.47% | ||
Secured Overnight Financing Rate (SOFR) | Revolving Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.50% | ||
Secured Overnight Financing Rate (SOFR) | Revolving Credit Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.90% | ||
Credit Spread Adjustment | Revolving Credit Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 0.10% | ||
London Interbank Offered Rate (LIBOR) | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 4.39% | ||
Applicable Margin Rate | Revolving Credit Facility | |||
Debt Instrument [Line Items] | |||
Basis spread on variable rate | 1.65% |
Notes_Payable - Schedule of Deb
Notes Payable - Schedule of Debt Interest Payment (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Debt Disclosure [Abstract] | ||
Interest payments on terminated term loan | $ 1,396 | $ 1,443 |
Interest payments on revolving credit facility | $ 2,598 | $ 0 |
Stockholders_ Equity - Narrativ
Stockholders’ Equity - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | Nov. 20, 2023 | Jan. 18, 2023 | Jan. 12, 2023 | Dec. 31, 2023 | Dec. 31, 2022 |
Subsidiary, Sale of Stock [Line Items] | |||||
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 | 168,000,000 | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 2,000,000 | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | ||
Preferred stock, liquidation preference (in dollars per share) | $ 50 | ||||
Preferred stock, convertible, conversion price (in dollars per share) | $ 6.04 | ||||
Preferred stock, shares outstanding (in shares) | 1,969,660 | 0 | 1,969,660 | ||
Convertible preferred stock (in shares) | 16,305,113 | ||||
IPO | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, price per share (in dollars per share) | $ 15 | ||||
Proceeds from equity offerings | $ 62 | ||||
IPO - Shares From Company | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, number of shares issued (in shares) | 4,750,000 | ||||
Follow-On Offering | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, price per share (in dollars per share) | $ 30.50 | ||||
Sale of stock, consideration | $ 62.5 | ||||
Follow-On Offering - Shares From Company | |||||
Subsidiary, Sale of Stock [Line Items] | |||||
Sale of stock, number of shares issued (in shares) | 2,150,000 |
Income Taxes - Schedule of Comp
Income Taxes - Schedule of Components of Income Tax Expense (Benefit) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Current income tax expense | $ 14,736 | $ 120 |
Deferred tax expense | 9,382 | 10,267 |
Income tax expense | $ 24,118 | $ 10,387 |
Income Taxes - Schedule of Effe
Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Amount | ||
Income tax expense at federal statutory rate | $ 23,121 | $ 10,454 |
Tax advantaged investments | (295) | (324) |
Other | 1,292 | 257 |
Income tax expense | $ 24,118 | $ 10,387 |
Percentage | ||
Income tax expense at federal statutory rate | 21% | 21% |
Tax advantaged investments | (0.30%) | (0.70%) |
Other | 1.20% | 0.60% |
Total income tax expense | 21.90% | 20.90% |
Income Taxes - Schedule of Defe
Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Deferred tax assets: | ||
Net operating losses | $ 10,655 | $ 14,966 |
Losses and loss adjustment expenses | 11,581 | 10,748 |
Unearned premiums | 15,365 | 11,959 |
Unrealized losses on fixed maturity securities, available-for-sale | 6,113 | 11,563 |
Stock options/awards | 1,714 | 1,107 |
Other | 4,237 | 5,297 |
Total deferred tax assets | 49,665 | 55,640 |
Less valuation allowance | 586 | 586 |
Total deferred tax assets after valuation allowance | 49,079 | 55,054 |
Deferred tax liabilities: | ||
Deferred policy acquisition costs | 11,528 | 8,209 |
Other long-term investments | 6,460 | 6,055 |
Section 481(a) adjustment | 3,477 | 1,405 |
Unrealized gains on equity securities | 3,243 | 825 |
Depreciation | 1,260 | 1,481 |
Other | 1,120 | 891 |
Total deferred tax liabilities | 27,088 | 18,866 |
Deferred income taxes | $ 21,991 | $ 36,188 |
Income Taxes - Narrative (Detai
Income Taxes - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Cash paid for federal income taxes | $ 15,800 | $ 0 |
Operating loss carryforwards | 49,400 | |
Operating loss carryforwards, limitations on use, amount | 49,300 | |
Deferred tax subject to expiration | 2,800 | |
Deferred tax effected by expiration | 600 | |
Capital loss carryover | 700 | |
Deferred tax valuation allowance | $ 586 | $ 586 |
Reserves for Losses and Loss _3
Reserves for Losses and Loss Adjustment Expenses - Schedule of Liability for Unpaid Claims and Claims Adjustment Expense (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 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 | 516,664 | 393,939 |
Prior years | 0 | 14,385 |
Total incurred, net of reinsurance | 516,664 | 408,324 |
Paid, net of reinsurance, related to: | ||
Current period | 109,937 | 105,928 |
Prior years | 253,481 | 194,836 |
Total paid | 363,418 | 300,764 |
Net reserves for losses and LAE, end of period | 859,017 | 705,771 |
Plus: reinsurance recoverable on unpaid claims, end of period | 455,484 | 435,986 |
Reserves for losses and LAE, end of period | $ 1,314,501 | $ 1,141,757 |
Reserves for Losses and Loss _4
Reserves for Losses and Loss Adjustment Expenses - Narrative (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | |
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
Prior year claims incurred, unfavorable (favorable) development | $ 0 | $ 14,385 | |
Exited Lines | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
Prior year claims incurred, unfavorable (favorable) development | 14,500 | ||
Multi-line Solutions | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
Reserves for losses and LAE, increase (decrease) | 11,900 | ||
Prior year claims incurred, unfavorable (favorable) development | 10,800 | ||
Liability for unpaid claims and claims adjustment | $ 8,400 | ||
Short Tail/Monoline Specialty | |||
Liability for Claims and Claims Adjustment Expense [Line Items] | |||
Reserves for losses and LAE, increase (decrease) | $ (9,200) | ||
Prior year claims incurred, unfavorable (favorable) development | $ 2,300 |
Reserves for Losses and Loss _5
Reserves for Losses and Loss Adjustment Expenses - Schedule of Short-Duration Insurance Contracts (Details) $ in Thousands | Dec. 31, 2023 USD ($) claim | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | Dec. 31, 2018 USD ($) | Dec. 31, 2017 USD ($) | Dec. 31, 2016 USD ($) | Dec. 31, 2015 USD ($) | Dec. 31, 2014 USD ($) |
Claims Development [Line Items] | ||||||||||
Total net reserves for loss and LAE | $ 859,017 | |||||||||
Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 542,024 | |||||||||
Cumulative net paid loss and LAE from the table below | (283,284) | |||||||||
Net reserves for loss and LAE before 2019 | 17,964 | |||||||||
Total net reserves for loss and LAE | 276,704 | |||||||||
Cumulative net paid loss and LAE | 283,284 | |||||||||
Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 1,459,906 | |||||||||
Cumulative net paid loss and LAE from the table below | (994,414) | |||||||||
Net reserves for loss and LAE before 2019 | (2,346) | |||||||||
Total net reserves for loss and LAE | 463,146 | |||||||||
Cumulative net paid loss and LAE | 994,414 | |||||||||
Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 752,724 | |||||||||
Cumulative net paid loss and LAE from the table below | (637,997) | |||||||||
Net reserves for loss and LAE before 2019 | 4,440 | |||||||||
Total net reserves for loss and LAE | 119,167 | |||||||||
Cumulative net paid loss and LAE | 637,997 | |||||||||
Accident Year 2014 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 118,277 | $ 120,777 | $ 120,731 | $ 118,995 | $ 117,783 | $ 116,970 | $ 116,970 | $ 115,749 | $ 100,355 | $ 100,355 |
Cumulative net paid loss and LAE from the table below | (102,214) | (104,076) | (106,214) | (105,756) | (104,984) | (101,984) | (96,639) | (81,251) | (63,699) | (32,530) |
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 1,016 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,979 | |||||||||
Cumulative net paid loss and LAE | $ 102,214 | 104,076 | 106,214 | 105,756 | 104,984 | 101,984 | 96,639 | 81,251 | 63,699 | 32,530 |
Accident Year 2014 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 69,027 | 72,027 | 71,451 | 70,186 | 69,120 | 63,994 | 63,995 | 62,691 | 58,170 | 64,186 |
Cumulative net paid loss and LAE from the table below | (56,594) | (55,737) | (53,615) | (53,290) | (52,450) | (49,906) | (50,785) | (42,141) | (30,863) | (9,700) |
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 7,650 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,170 | |||||||||
Cumulative net paid loss and LAE | $ 56,594 | 55,737 | 53,615 | 53,290 | 52,450 | 49,906 | 50,785 | 42,141 | 30,863 | $ 9,700 |
Accident Year 2015 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 127,102 | 122,902 | 122,881 | 121,746 | 119,216 | 117,024 | 117,024 | 114,266 | 103,191 | |
Cumulative net paid loss and LAE from the table below | (123,268) | (118,166) | (117,295) | (114,098) | (108,291) | (99,401) | (88,833) | (72,137) | (44,152) | |
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 910 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 5,369 | |||||||||
Cumulative net paid loss and LAE | $ 123,268 | 118,166 | 117,295 | 114,098 | 108,291 | 99,401 | 88,833 | 72,137 | 44,152 | |
Accident Year 2015 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 87,167 | 84,167 | 83,432 | 80,787 | 75,296 | 70,912 | 68,118 | 65,173 | 61,920 | |
Cumulative net paid loss and LAE from the table below | (83,706) | (81,789) | (80,312) | (77,981) | (73,100) | (65,269) | (55,610) | (41,653) | (9,026) | |
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 3,985 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,565 | |||||||||
Cumulative net paid loss and LAE | $ 83,706 | 81,789 | 80,312 | 77,981 | 73,100 | 65,269 | 55,610 | 41,653 | $ 9,026 | |
Accident Year 2016 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 75,923 | 74,923 | 74,794 | 71,306 | 64,248 | 64,448 | 64,448 | 64,828 | ||
Cumulative net paid loss and LAE from the table below | (74,882) | (73,170) | (65,498) | (62,469) | (60,500) | (54,957) | (44,133) | (24,844) | ||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 2,741 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,695 | |||||||||
Cumulative net paid loss and LAE | $ 74,882 | 73,170 | 65,498 | 62,469 | 60,500 | 54,957 | 44,133 | 24,844 | ||
Accident Year 2016 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 108,366 | 108,366 | 107,390 | 106,368 | 96,090 | 93,885 | 95,509 | 95,914 | ||
Cumulative net paid loss and LAE from the table below | (92,867) | (89,565) | (87,393) | (83,115) | (79,669) | (71,852) | (59,237) | (38,191) | ||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 4,946 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,879 | |||||||||
Cumulative net paid loss and LAE | $ 92,867 | 89,565 | 87,393 | 83,115 | 79,669 | 71,852 | 59,237 | $ 38,191 | ||
Accident Year 2017 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 84,580 | 82,080 | 81,807 | 76,231 | 67,578 | 68,650 | 68,650 | |||
Cumulative net paid loss and LAE from the table below | (74,770) | (72,415) | (70,562) | (67,553) | (56,411) | (45,263) | (27,088) | |||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 4,803 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 5,524 | |||||||||
Cumulative net paid loss and LAE | $ 74,770 | 72,415 | 70,562 | 67,553 | 56,411 | 45,263 | 27,088 | |||
Accident Year 2017 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 82,865 | 101,865 | 99,559 | 97,578 | 84,872 | 82,668 | 78,246 | |||
Cumulative net paid loss and LAE from the table below | (68,747) | (70,219) | (65,301) | (58,625) | (53,770) | (53,888) | (35,962) | |||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 13,081 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,318 | |||||||||
Cumulative net paid loss and LAE | $ 68,747 | 70,219 | 65,301 | 58,625 | 53,770 | 53,888 | $ 35,962 | |||
Accident Year 2018 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 73,179 | 77,379 | 77,039 | 77,039 | 77,647 | 77,647 | ||||
Cumulative net paid loss and LAE from the table below | (71,042) | (73,251) | (67,289) | (53,491) | (45,739) | (29,372) | ||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 8,983 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 5,048 | |||||||||
Cumulative net paid loss and LAE | $ 71,042 | 73,251 | 67,289 | 53,491 | 45,739 | 29,372 | ||||
Accident Year 2018 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 105,150 | 100,150 | 93,812 | 82,366 | 71,589 | 76,956 | ||||
Cumulative net paid loss and LAE from the table below | (103,432) | (93,224) | (82,881) | (69,695) | (62,582) | (27,985) | ||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 1,571 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,886 | |||||||||
Cumulative net paid loss and LAE | $ 103,432 | 93,224 | 82,881 | 69,695 | 62,582 | $ 27,985 | ||||
Accident Year 2019 | Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 53,100 | 51,100 | 47,600 | 50,400 | 65,221 | |||||
Cumulative net paid loss and LAE from the table below | (47,255) | (47,330) | (43,784) | (42,528) | (36,013) | |||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 2,832 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 1,034 | |||||||||
Cumulative net paid loss and LAE | $ 47,255 | 47,330 | 43,784 | 42,528 | 36,013 | |||||
Accident Year 2019 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 125,337 | 114,389 | 109,925 | 109,925 | 110,925 | |||||
Cumulative net paid loss and LAE from the table below | (113,207) | (100,094) | (82,296) | (63,022) | (36,512) | |||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 5,623 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 6,042 | |||||||||
Cumulative net paid loss and LAE | $ 113,207 | 100,094 | 82,296 | 63,022 | 36,512 | |||||
Accident Year 2019 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 117,302 | 110,546 | 96,070 | 94,550 | 91,067 | |||||
Cumulative net paid loss and LAE from the table below | (98,392) | (85,798) | (69,602) | (66,163) | (31,556) | |||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 2,425 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 5,580 | |||||||||
Cumulative net paid loss and LAE | $ 98,392 | 85,798 | 69,602 | 66,163 | $ 31,556 | |||||
Accident Year 2020 | Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 66,690 | 66,690 | 66,690 | 68,190 | ||||||
Cumulative net paid loss and LAE from the table below | (72,351) | (72,514) | (58,329) | (32,805) | ||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 1,877 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 1,288 | |||||||||
Cumulative net paid loss and LAE | $ 72,351 | 72,514 | 58,329 | 32,805 | ||||||
Accident Year 2020 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 139,090 | 139,090 | 145,846 | 145,846 | ||||||
Cumulative net paid loss and LAE from the table below | (113,637) | (88,499) | (72,182) | (38,504) | ||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 6,933 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 5,453 | |||||||||
Cumulative net paid loss and LAE | $ 113,637 | 88,499 | 72,182 | 38,504 | ||||||
Accident Year 2020 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 98,512 | 90,609 | 90,609 | 87,809 | ||||||
Cumulative net paid loss and LAE from the table below | (80,744) | (66,477) | (57,959) | (27,476) | ||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 5,637 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 4,756 | |||||||||
Cumulative net paid loss and LAE | $ 80,744 | 66,477 | 57,959 | $ 27,476 | ||||||
Accident Year 2021 | Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 91,757 | 102,970 | 102,970 | |||||||
Cumulative net paid loss and LAE from the table below | (66,902) | (52,326) | (17,554) | |||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 5,496 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 1,556 | |||||||||
Cumulative net paid loss and LAE | $ 66,902 | 52,326 | 17,554 | |||||||
Accident Year 2021 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 175,173 | 175,173 | 179,174 | |||||||
Cumulative net paid loss and LAE from the table below | (105,853) | (84,530) | (44,996) | |||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 48,993 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 6,611 | |||||||||
Cumulative net paid loss and LAE | $ 105,853 | 84,530 | 44,996 | |||||||
Accident Year 2021 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 36,294 | 52,392 | 57,392 | |||||||
Cumulative net paid loss and LAE from the table below | (29,317) | (20,594) | (15,002) | |||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 9,014 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 2,337 | |||||||||
Cumulative net paid loss and LAE | $ 29,317 | 20,594 | $ 15,002 | |||||||
Accident Year 2022 | Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 125,288 | 125,288 | ||||||||
Cumulative net paid loss and LAE from the table below | (63,880) | (21,404) | ||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 57,026 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 2,151 | |||||||||
Cumulative net paid loss and LAE | $ 63,880 | 21,404 | ||||||||
Accident Year 2022 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 232,748 | 232,748 | ||||||||
Cumulative net paid loss and LAE from the table below | (140,490) | (64,849) | ||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 35,167 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 8,360 | |||||||||
Cumulative net paid loss and LAE | $ 140,490 | 64,849 | ||||||||
Accident Year 2022 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 45,111 | 35,834 | ||||||||
Cumulative net paid loss and LAE from the table below | (22,208) | (19,676) | ||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 12,913 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 215 | |||||||||
Cumulative net paid loss and LAE | $ 22,208 | $ 19,676 | ||||||||
Accident Year 2023 | Short Tail/Monoline Specialty | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 205,189 | |||||||||
Cumulative net paid loss and LAE from the table below | (32,896) | |||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 110,310 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 3,175 | |||||||||
Cumulative net paid loss and LAE | $ 32,896 | |||||||||
Accident Year 2023 | Multi-line Solutions | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 308,497 | |||||||||
Cumulative net paid loss and LAE from the table below | (75,051) | |||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 168,794 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 7,370 | |||||||||
Cumulative net paid loss and LAE | $ 75,051 | |||||||||
Accident Year 2023 | Exited Lines | ||||||||||
Claims Development [Line Items] | ||||||||||
Incurred losses and ALAE, net of reinsurance | 2,930 | |||||||||
Cumulative net paid loss and LAE from the table below | (1,990) | |||||||||
Short-Duration Insurance Contracts, Incurred but Not Reported (IBNR) Claims Liability, Net | $ 8,478 | |||||||||
Short-Duration Insurance Contract, Cumulative Number of Reported Claims | claim | 31 | |||||||||
Cumulative net paid loss and LAE | $ 1,990 |
Reserves for Losses and Loss _6
Reserves for Losses and Loss Adjustment Expenses - Reconciliation of Claims Development to Liability (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Short-Duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||
Reserves for losses and LAE, net of reinsurance | $ 859,017 | ||
Total reinsurance recoverable on unpaid claims | 455,484 | $ 435,986 | $ 381,338 |
Reserves for losses and loss adjustment expenses | 1,314,501 | $ 1,141,757 | $ 979,549 |
Short Tail/Monoline Specialty | |||
Short-Duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||
Reserves for losses and LAE, net of reinsurance | 276,704 | ||
Total reinsurance recoverable on unpaid claims | 199,044 | ||
Multi-line Solutions | |||
Short-Duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||
Reserves for losses and LAE, net of reinsurance | 463,146 | ||
Total reinsurance recoverable on unpaid claims | 252,146 | ||
Exited Lines | |||
Short-Duration Insurance Contracts, Reconciliation of Claims Development to Liability [Line Items] | |||
Reserves for losses and LAE, net of reinsurance | 119,167 | ||
Total reinsurance recoverable on unpaid claims | $ 4,294 |
Reserves for Losses and Loss _7
Reserves for Losses and Loss Adjustment Expenses - Schedule of Historical Claims Duration (Details) | Dec. 31, 2023 |
Short Tail/Monoline Specialty | |
Short-Duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 54% |
Year 2 | 24.70% |
Year 3 | 12.10% |
Year 4 | 5% |
Year 5 | 2.20% |
Year 6 | 1% |
Year 7 | 0.50% |
Year 8 | 0.20% |
Year 9 | 0.20% |
Year 10 | 0.10% |
Multi-line Solutions | |
Short-Duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 37.70% |
Year 2 | 22.60% |
Year 3 | 16.60% |
Year 4 | 10.60% |
Year 5 | 5.30% |
Year 6 | 3.90% |
Year 7 | 2% |
Year 8 | 0.40% |
Year 9 | 0.40% |
Year 10 | 0.50% |
Exited Lines | |
Short-Duration Insurance Contracts, Historical Claims Duration [Line Items] | |
Year 1 | 42.80% |
Year 2 | 22% |
Year 3 | 14.20% |
Year 4 | 8.40% |
Year 5 | 3.20% |
Year 6 | 3.20% |
Year 7 | 2.70% |
Year 8 | 1% |
Year 9 | 0.80% |
Year 10 | 1.70% |
Commission and Fee Income - Dis
Commission and Fee Income - Disaggregation of Revenue (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | $ 6,064 | $ 5,199 |
SUA commission revenue | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | 2,864 | 3,224 |
SUA fee income | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | 2,732 | 1,597 |
Other | ||
Disaggregation of Revenue [Line Items] | ||
Total commission and fee income | $ 468 | $ 378 |
Commission and Fee Income - Con
Commission and Fee Income - Contract Asset (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Revenue from Contract with Customer [Abstract] | |||
Contract Assets | $ 976 | $ 1,292 | $ 1,209 |
Underwriting, Acquisition and_3
Underwriting, Acquisition and Insurance Expenses (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Other Income and Expenses [Abstract] | ||
Amortization of policy acquisition costs | $ 108,514 | $ 65,695 |
Other operating and general expenses | 134,930 | 116,476 |
Total underwriting, acquisition and insurance expenses | $ 243,444 | $ 182,171 |
Reinsurance - Schedule of Premi
Reinsurance - Schedule of Premiums Written and Earned (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Written | ||
Direct premiums | $ 1,241,180 | $ 1,012,239 |
Assumed premiums | 218,649 | 131,713 |
Ceded premiums | (549,138) | (468,409) |
Net premiums | 910,691 | 675,543 |
Earned | ||
Direct premiums | 1,155,835 | 951,121 |
Assumed premiums | 193,971 | 113,610 |
Ceded premiums | (520,663) | (448,737) |
Net earned premium | 829,143 | 615,994 |
Ceded losses and LAE incurred | $ 337,011 | $ 311,257 |
Reinsurance - Reinsurance Recov
Reinsurance - Reinsurance Recoverables and Ceded Premiums (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2021 |
Insurance [Abstract] | |||
Ceded unpaid losses and LAE | $ 455,484 | $ 435,986 | $ 381,338 |
Ceded paid losses and LAE | 122,287 | 107,228 | |
Loss portfolio transfer | 20,858 | 38,145 | |
Allowance for credit losses | (2,295) | 0 | |
Reinsurance recoverables, net | 596,334 | 581,359 | |
Ceded unearned premium | $ 186,121 | $ 157,645 |
Reinsurance - Narrative (Detail
Reinsurance - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2020 | Dec. 31, 2023 | Dec. 31, 2022 | |
Insurance [Abstract] | |||
Market value of trust funds | $ 158,100 | ||
Liability for claims and claims adjustment expense, loss portfolio transfer | $ 127,400 | ||
Strengthening or reserves subject to the LPT increase (decrease) | 0 | $ 14,385 | |
Reinsurance recoveries under the LPT | 1,427 | 5,813 | |
Deposit contracts, assets | $ 29,900 | $ 41,800 |
Reinsurance - Impact of LPT (De
Reinsurance - Impact of LPT (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Insurance [Abstract] | ||
Strengthening of reserves subject to the LPT | $ 0 | $ (14,385) |
Reinsurance recoveries under the LPT | 1,427 | 5,813 |
Pretax net impact of the LPT | $ 1,427 | $ (8,572) |
Stock Based Compensation - Narr
Stock Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Jan. 12, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 3,200,656 | ||
Granted (in shares) | 1,101,856 | 198,842 | |
Options granted (in shares) | 759,990 | ||
Aggregate intrinsic value of options | $ 14.3 | ||
Weighted average remaining contractual life of options | 9 years | ||
Unrecognized compensation cost | $ 15.9 | ||
Unrecognized compensation cost, recognition period | 1 year 6 months | ||
Stock based compensation expense | $ 8.5 | $ 2.3 | |
Purchase period | 6 months | ||
IPO | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Sale of stock, price per share (in dollars per share) | $ 15 | ||
Employee Stock | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 376,548 | ||
Stock based compensation expense | $ 0.2 | ||
Purchase price of common stock, percent | 85% | ||
Shares issued in period (in shares) | 35,430 | ||
Amount capitalized | $ 0.3 | ||
Restricted Stock Awards And Units | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Fair value of shares vested in period | $ 0.5 | $ 2.2 | |
Awarded options | |||
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) | 1,861,846 | 198,842 | |
Stock options granted to employees | $ 4.4 | ||
Long Term Incentive Plan | Restricted Stock Awards And Units | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Granted (in shares) | 1,101,856 | 198,842 | |
Shares granted, value | $ 17.7 | $ 2.6 | |
Long Term Incentive Plan | Awarded options | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common share (in shares) | 759,990 | ||
Long Term Incentive Plan | Director | Restricted Stock | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Granted (in shares) | 23,482 | 15,196 | |
Requisite service period | 1 year |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Equity Awards (Details) - shares | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Jan. 12, 2023 | |
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 3,200,656 | ||
Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 1,861,846 | 198,842 | |
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 | Minimum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 0% | 0% | |
Market condition awards | Maximum | 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) | 95,456 | 26,210 | |
Performance condition awards | Minimum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Award Payout Range | 0% | 0% | |
Performance condition awards | Maximum | 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) | 968,778 | 144,137 | |
Service condition awards | Minimum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 1 year | ||
Service condition awards | Maximum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 4 years | ||
Service Condition Awards | Minimum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 1 year | ||
Service Condition Awards | Maximum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 3 years | ||
Awarded options | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Authorized target common shares (in shares) | 759,990 | ||
Awarded options | Minimum | Long Term Incentive Plan | |||
Share-Based Compensation Arrangement by Share-Based Payment Award [Line Items] | |||
Requisite Service Period | 3 years | ||
Awarded options | Maximum | 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) | 12 Months Ended |
Dec. 31, 2023 $ / shares shares | |
Weighted-Average Exercise Price | |
Granted, weighted average exercise price (in dollars per share) | $ / shares | $ 15 |
Stock | |
Outstanding, beginning of period (in shares) | 0 |
Granted (in shares) | 759,990 |
Outstanding, ending of period (in shares) | 759,990 |
Stock Based Compensation - Sche
Stock Based Compensation - Schedule of Nonvested Share Activity (Details) - $ / shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 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) | 16.07 | 14.17 |
Vested (in dollars per share) | 13.39 | 15.16 |
Forfeited (in dollars per share) | 15.29 | 12.51 |
Non-vested, ending period (in dollars per share) | $ 15.13 | $ 12.55 |
Stock and Stock Units | ||
Non-vested, beginning period (in shares) | 419,896 | 375,643 |
Granted (in shares) | 1,101,856 | 198,842 |
Vested (in shares) | (40,645) | (144,042) |
Forfeited (in shares) | (35,658) | (10,547) |
Non-vested, ending period (in shares) | 1,445,449 | 419,896 |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Numerator | ||
Net income | $ 85,984 | $ 39,396 |
Less: Undistributed income allocated to participating securities | (1,677) | (18,879) |
Net income attributable to common shareholders | 84,307 | 20,517 |
Add back: Undistributed income allocated to participating securities | 1,677 | 18,879 |
Net income (numerator for diluted earnings per share under the two-class method) | $ 85,984 | $ 39,396 |
Denominator | ||
Basic weighted-average common shares (in shares) | 36,031,907 | 16,568,393 |
Preferred shares (if converted method) (in shares) | 716,708 | 15,245,533 |
Contingently issuable instruments (treasury stock method) (in shares) | 696,110 | 519,080 |
Diluted weighted-average common share equivalents (in shares) | 38,317,534 | 32,653,194 |
Basic earnings per share (in dollars per share) | $ 2.34 | $ 1.24 |
Diluted earnings per share (in dollars per share) | $ 2.24 | $ 1.21 |
Market condition awards | ||
Denominator | ||
Awards (in shares) | 736,837 | 320,188 |
Performance condition awards | ||
Denominator | ||
Awards (in shares) | 135,972 | 0 |
Earnings Per Share - Schedule_2
Earnings Per Share - Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share (Details) - shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Stock notes | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 60,576 |
Awarded stock units | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 3,931 | 0 |
Awarded options | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 914 | 0 |
Earnings Per Share - Schedule_3
Earnings Per Share - Schedule of Earnings Per Share, Excluded from Basic Earnings (Details) - shares | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Contingently issuable instruments | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 920,864 | 1,082,521 |
Common shares | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 920,864 | 22,919 |
Preferred shares, if converted | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive securities (in shares) | 0 | 1,059,602 |
Employee Benefit Plans (Details
Employee Benefit Plans (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Retirement Benefits [Abstract] | ||
Defined contribution plan | $ 2.9 | $ 2.4 |
Related Party Transactions - We
Related Party Transactions - Westaim Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Unrealized gain (loss) | $ 11,516 | $ (15,058) | |
Skyward Specialty Insurance Group | Westaim HIIG LP | |||
Related Party Transaction [Line Items] | |||
Ownership interest | 17.50% | 44.50% | |
Principal Owner | Purchase Of Common Stock | Westaim | |||
Related Party Transaction [Line Items] | |||
Related party transaction, shares (in shares) | 3,076,924 | ||
Related party transaction, consideration received | $ 8,400 | ||
Limited partner | Westaim | |||
Related Party Transaction [Line Items] | |||
Unrealized gain (loss) | $ (500) | $ (2,300) |
Related Party Transactions - RI
Related Party Transactions - RISCOM Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2023 | Dec. 31, 2022 | Dec. 31, 2016 | |
Related Party Transaction [Line Items] | |||
Net earned premiums | $ 829,143 | $ 615,994 | |
Premiums receivable, net | 179,235 | 139,215 | |
Affiliated entity | Agency agreement | RISCOM | |||
Related Party Transaction [Line Items] | |||
Agreement, ownership interest | 20% | ||
Net earned premiums | 99,736 | 91,051 | |
Gross written commissions | 24,177 | 23,472 | |
Premiums receivable, net | $ 10,600 | $ 9,900 |
Related Party Transactions - Re
Related Party Transactions - Resinsurance Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||
Ceded Premiums Earned | $ 520,663 | $ 448,737 |
Reinsurance recoverables, net | $ 596,334 | 581,359 |
Everest Reinsurance Co | Reinsurance agreement | Affiliated entity | ||
Related Party Transaction [Line Items] | ||
Ceded Premiums Earned | 59,600 | |
Reinsurance recoverables, net | $ 177,500 |
Related Party Transactions - Ot
Related Party Transactions - Other Transactions (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended |
Dec. 31, 2023 | Dec. 31, 2023 | |
Professional fees and reimbursements | Related Party | ||
Related Party Transaction [Line Items] | ||
Professional fees | $ 3.6 | $ 3.4 |
Commitment and Contingencies -
Commitment and Contingencies - Narrative (Details) - USD ($) | Dec. 31, 2023 | Dec. 31, 2022 |
Commitments and Contingencies Disclosure [Abstract] | ||
Loss contingency accrual | $ 0 | $ 0 |
Statutory Accounting Principl_3
Statutory Accounting Principles and Regulatory Matters (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Insurance [Abstract] | ||
Statutory net income | $ 46,884 | $ 10,860 |
Statutory capital and surplus | $ 602,916 | $ 408,167 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Mar. 15, 2024 | Dec. 31, 2023 | Dec. 31, 2022 | |
Subsequent Event [Line Items] | |||
Proceeds from line of creit | $ 50,000 | $ 0 | |
Revolving Credit Facility | Subsequent event | Subordinated Debt | |||
Subsequent Event [Line Items] | |||
Accrued interest | $ 1,400 | ||
Proceeds from line of creit | 50,000 | ||
Line of credit | 100,000 | ||
Remaining borrowing capacity | $ 50,000 |
SEC Schedule, Article 12-15, Su
SEC Schedule, Article 12-15, Summary of Investments - Other than Investments in Related Parties (Details) $ in Thousands | Dec. 31, 2023 USD ($) |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | $ 1,518,431 |
Fair Value (if applicable) | 1,501,011 |
Amount on Balance Sheet | 1,502,980 |
Fixed maturity securities, available for sale: | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 1,047,713 |
Fair Value (if applicable) | 1,017,651 |
Amount on Balance Sheet | 1,017,651 |
Fixed maturity securities, available for sale: | U.S. government securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 44,685 |
Fair Value (if applicable) | 44,166 |
Amount on Balance Sheet | 44,166 |
Fixed maturity securities, available for sale: | Corporate securities and miscellaneous | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 392,773 |
Fair Value (if applicable) | 383,420 |
Amount on Balance Sheet | 383,420 |
Fixed maturity securities, available for sale: | Municipal securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 98,266 |
Fair Value (if applicable) | 92,778 |
Amount on Balance Sheet | 92,778 |
Fixed maturity securities, available for sale: | Residential mortgage-backed securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 292,568 |
Fair Value (if applicable) | 281,626 |
Amount on Balance Sheet | 281,626 |
Fixed maturity securities, available for sale: | Commercial mortgage-backed securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 31,411 |
Fair Value (if applicable) | 29,934 |
Amount on Balance Sheet | 29,934 |
Fixed maturity securities, available for sale: | Other asset-backed securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 188,010 |
Fair Value (if applicable) | 185,727 |
Amount on Balance Sheet | 185,727 |
Fixed maturity securities, held to maturity: | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 43,315 |
Fair Value (if applicable) | 41,017 |
Amount on Balance Sheet | 42,986 |
Fixed maturity securities, held to maturity: | Other asset-backed securities | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 43,315 |
Fair Value (if applicable) | 41,017 |
Amount on Balance Sheet | 42,986 |
Equity securities: | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 102,837 |
Fair Value (if applicable) | 118,249 |
Amount on Balance Sheet | 118,249 |
Equity securities: | Common stocks | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 54,672 |
Fair Value (if applicable) | 67,425 |
Amount on Balance Sheet | 67,425 |
Equity securities: | Preferred stocks | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 8,736 |
Fair Value (if applicable) | 7,358 |
Amount on Balance Sheet | 7,358 |
Equity securities: | Mutual funds | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 39,429 |
Fair Value (if applicable) | 43,466 |
Amount on Balance Sheet | 43,466 |
Mortgage loans | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 50,542 |
Fair Value (if applicable) | 50,070 |
Amount on Balance Sheet | 50,070 |
Other long-term investments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 3,798 |
Fair Value (if applicable) | 3,798 |
Amount on Balance Sheet | 3,798 |
Short-term investments | |
SEC Schedule, 12-15, Insurance Companies, Summary of Investments, Other than Investments in Related Parties [Line Items] | |
Cost | 270,226 |
Fair Value (if applicable) | 270,226 |
Amount on Balance Sheet | $ 270,226 |
SCHEDULE II__ CONDENSED FINAN_2
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT - Condensed Balance Sheet (Details) - USD ($) $ in Thousands | Dec. 31, 2023 | Dec. 31, 2022 |
Investments: | ||
Short-term investments, at fair value | $ 270,226 | $ 121,158 |
Total investments | 1,613,687 | 1,082,367 |
Cash and cash equivalents | 65,891 | 45,438 |
Deferred income taxes, net | 21,991 | 36,188 |
Goodwill and intangible assets, net | 88,435 | 89,870 |
Other assets | 75,341 | 82,846 |
Total assets | 2,953,435 | 2,363,439 |
Liabilities: | ||
Accounts payable and accrued liabilities | 50,880 | 48,499 |
Notes payable | 50,000 | 50,000 |
Subordinated debt, net of debt issuance costs | 78,690 | 78,609 |
Total liabilities | 2,292,404 | 1,941,777 |
Stockholders’ Equity: | ||
Stockholders’ equity | 661,031 | 421,662 |
Total liabilities and stockholders’ equity | 2,953,435 | 2,363,439 |
Parent Company | ||
Investments: | ||
Investment in subsidiaries | 743,025 | 503,549 |
Short-term investments, at fair value | 10,593 | 25 |
Total investments | 753,618 | 503,574 |
Cash and cash equivalents | 3,024 | 8,909 |
Deferred income taxes, net | 5,899 | 19,655 |
Goodwill and intangible assets, net | 12,641 | 12,641 |
Other assets | 15,908 | 6,992 |
Total assets | 791,090 | 551,771 |
Liabilities: | ||
Accounts payable and accrued liabilities | 1,369 | 1,500 |
Notes payable | 50,000 | 50,000 |
Subordinated debt, net of debt issuance costs | 78,690 | 78,609 |
Total liabilities | 130,059 | 130,109 |
Stockholders’ Equity: | ||
Stockholders’ equity | 661,031 | 421,662 |
Total liabilities and stockholders’ equity | $ 791,090 | $ 551,771 |
SCHEDULE II__ CONDENSED FINAN_3
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT - Condensed Statement of Operations (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Revenues: | ||
Net investment income | $ 40,322 | $ 36,931 |
Net investment gains (losses) | 11,072 | (15,705) |
Other (loss) income | (632) | 1 |
Total revenues | 885,969 | 642,420 |
Expenses: | ||
Interest expense | 10,024 | 6,407 |
Amortization | 1,798 | 1,547 |
Other expenses | 5,364 | 0 |
Total expenses | 775,867 | 592,637 |
Income tax expense (benefit) | 24,118 | 10,387 |
Net loss before equity in earnings of subsidiaries | 84,307 | 20,517 |
Net income attributable to participating securities | 1,677 | 18,879 |
Net income | 85,984 | 39,396 |
Parent Company | ||
Revenues: | ||
Net investment income | 3,822 | 2,567 |
Net investment gains (losses) | (963) | (6) |
Other (loss) income | (27) | 0 |
Total revenues | 2,832 | 2,561 |
Expenses: | ||
Interest expense | 9,815 | 6,407 |
Amortization | 313 | 81 |
Other expenses | 451 | 0 |
Total expenses | 10,579 | 6,488 |
Loss before income tax expense | (7,747) | (3,927) |
Income tax expense (benefit) | 6,808 | (1,209) |
Net loss before equity in earnings of subsidiaries | (14,555) | (2,718) |
Net income attributable to participating securities | 100,539 | 42,114 |
Net income | $ 85,984 | $ 39,396 |
SCHEDULE II__ CONDENSED FINAN_4
SCHEDULE II — CONDENSED FINANCIAL INFORMATION OF REGISTRANT - Condensed Statement of Cash Flows (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 85,984 | $ 39,396 |
Net cash provided by operating activities | 338,187 | 208,938 |
Cash flows from investing activities: | ||
Net cash used in investing activities | (493,809) | (193,381) |
Cash flows from financing activities: | ||
Proceeds from employee stock purchase plan | 710 | 0 |
Draw on revolving line of credit | 50,000 | 0 |
Repayment of term loan | (50,000) | 0 |
Proceeds from equity offerings | 128,887 | 0 |
Employee share purchases | 1,350 | 2,180 |
Net cash provided by financing activities | 130,947 | 2,180 |
Net (decrease) increase in cash and cash equivalents and restricted cash | (24,675) | 17,737 |
Cash and cash equivalents and restricted cash at beginning of year | 125,011 | 107,274 |
Cash and cash equivalents and restricted cash at end of year | 100,336 | 125,011 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 10,667 | 5,761 |
Cash paid for federal income taxes | 15,800 | 0 |
Parent Company | ||
Cash flows from operating activities: | ||
Net income | 85,984 | 39,396 |
Adjustments to reconcile net income to net cash used in operating activities | (95,947) | (42,672) |
Net cash provided by operating activities | (9,963) | (3,276) |
Cash flows from investing activities: | ||
Capital contributions to subsidiaries | (122,800) | 0 |
Distributions from investment in subsidiaries | 6,500 | 4,000 |
Change in short-term investments | (10,569) | 0 |
Net cash used in investing activities | (126,869) | 4,000 |
Cash flows from financing activities: | ||
Proceeds from employee stock purchase plan | 1,350 | 2,180 |
Draw on revolving line of credit | 50,000 | 0 |
Repayment of term loan | (50,000) | 0 |
Proceeds from equity offerings | 128,887 | 0 |
Employee share purchases | 710 | 0 |
Net cash provided by financing activities | 130,947 | 2,180 |
Net (decrease) increase in cash and cash equivalents and restricted cash | (5,885) | 2,904 |
Cash and cash equivalents and restricted cash at beginning of year | 8,909 | 6,005 |
Cash and cash equivalents and restricted cash at end of year | 3,024 | 8,909 |
Supplemental disclosure of cash flow information: | ||
Cash paid for interest | 10,667 | 5,761 |
Cash paid for federal income taxes | $ 15,800 | $ 0 |
SCHEDULE IV__ REINSURANCE (Deta
SCHEDULE IV — REINSURANCE (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Direct premiums | $ 1,155,835 | $ 951,121 |
Ceded to other companies | (520,663) | (448,737) |
Assumed premiums | 193,971 | 113,610 |
Net amount | 829,143 | 615,994 |
Accident & Health | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Direct premiums | 151,702 | 130,377 |
Ceded to other companies | (79,091) | (70,291) |
Assumed premiums | 0 | 431 |
Net amount | $ 72,611 | $ 60,517 |
Percentage of amount assumed to net | 0% | 0.70% |
Property & Casualty | ||
SEC Schedule, 12-17, Insurance Companies, Reinsurance [Line Items] | ||
Direct premiums | $ 1,089,478 | $ 881,862 |
Ceded to other companies | (470,047) | (398,118) |
Assumed premiums | 218,649 | 131,282 |
Net amount | $ 838,080 | $ 615,026 |
Percentage of amount assumed to net | 26.10% | 21.30% |
SCHEDULE V__ VALUATION AND QU_2
SCHEDULE V — VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Accounting Standards Update [Extensible Enumeration] | Accounting Standards Update 2016-13 [Member] | |
Valuation Allowance For Deferred Tax Assets | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | $ 586 | $ 586 |
Charged to costs and expenses | 0 | 0 |
Amounts written off | 0 | 0 |
Recoveries of amounts previously written off | 0 | |
Ending balance | 586 | 586 |
Valuation Allowance For Deferred Tax Assets | Period of adoption, adjustment | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | 0 | |
Ending balance | 0 | |
Allowance for Uncollectible Reinsurance Recoverable | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | 0 | 0 |
Charged to costs and expenses | 0 | 0 |
Amounts written off | 0 | 0 |
Recoveries of amounts previously written off | 0 | |
Ending balance | 2,295 | 0 |
Allowance for Uncollectible Reinsurance Recoverable | Period of adoption, adjustment | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | 2,295 | |
Ending balance | 2,295 | |
Allowance for Uncollectible Premiums Receivable | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | 629 | 261 |
Charged to costs and expenses | 748 | 584 |
Amounts written off | (513) | (216) |
Recoveries of amounts previously written off | 100 | |
Ending balance | 964 | 629 |
Allowance for Uncollectible Premiums Receivable | Period of adoption, adjustment | ||
SEC Schedule, 12-09, Movement in Valuation Allowances and Reserves [Roll Forward] | ||
Beginning balance | $ 0 | |
Ending balance | $ 0 |
SCHEDULE VI__ SUPPLEMENTAL IN_2
SCHEDULE VI — SUPPLEMENTAL INFORMATION CONCERNING PROPERTY-CASUALTY INSURANCE OPERATIONS (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2023 | Dec. 31, 2022 | |
SEC Schedule, 12-18, Supplemental Information, Property-Casualty Insurance Underwriters [Abstract] | ||
Deferred policy acquisition costs | $ 91,955 | $ 68,938 |
Reserve for losses and loss adjustment expenses | 1,314,501 | 1,141,757 |
Unearned premiums | 552,532 | 442,509 |
Net earned premium | 829,143 | 615,994 |
Net investment income | 40,322 | 36,931 |
Losses and loss adjustment expenses (current year) | 516,664 | 393,939 |
Losses and loss adjustment expenses (prior years) | 0 | 14,385 |
Amortization of policy acquisition costs | 108,514 | 65,695 |
Paid claims and claim adjustment expenses | 363,418 | 300,764 |
Net premiums written | 910,691 | 675,543 |
Ceded unearned premium | 186,121 | 157,645 |
Deferred ceding commission | $ 37,057 | $ 29,849 |